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TMI Blog2021 (9) TMI 545X X X X Extracts X X X X X X X X Extracts X X X X ..... pted. 2. Whereas on the facts and in the circumstances of the case, the Learned CIT(A) Ajmer ought to have accepted the appellant's application Under Rule 46A of the I.T.Rules 1962 as the Assessing Officer had failed to reconcile /consider the documents submitted before him during the course of assessment proceedings. 3. That the Learned CIT (A), Ajmer, erred on facts and in law in confirming the addition of Rs. 500000/- which was made by the Assessing Officer as unexplained investment in the building, whereas the appellant has paid a sum of Rs. 450000/- jointly with his mother for purchase of property at Darji Mohalla, Lakhan kotri, Ajmer and further incurred a sum of Rs. 50000/- as its stamp & registration charges. Thus the Learned CIT(A) , Ajmer has wrongly confirmed the addition of Rs. 500000/- which may kindly be deleted. 4. That the Learned CIT(A), Ajmer erred on facts and in law in confirming the addition of Rs. 514400/- which was treated by the AO being unexplained credit in the name of Shri Ashok Matai, whereas said loan was given by Shri Ashok Matai at the time of starting the business of M/s Metro Filling Station. Thus an addition so confirmed by the CIT(A), Aj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e ld. AR appearing on behalf of the assessee has relied upon the written submissions in order to support his contention for raising ground Nos. 1 and 2 before us and the same is reproduced below: "1. At the outset it is submitted that the assessee filed additional evidences during the first appellate proceedings itself and notably, the then ld. CIT (A) even called for remand report from AO vide letter no. CIT (A)/AJM/2011-12/901 dated 05.09.2011, pursuant thereto the AO granted opportunity to the assessee and in response, very pertinently, the AIR attended and filed relevant documents along with Books of accounts. This fact is even admitted by the then AO (PB 74-79). 2. During the remand proceedings (first round) the AO extensively examined the Books of Accounts and the records w.r.t. the addition & disallowances and observed as under: S.No. Addition / Disallowance AO's Comments 1 Trading Addition of Rs. 34,183/-. "Since the apparent error rectified u/s 154 as appealed for, hence no more comments needed, the assessee has also not pressed upon the issue." (Deleted) (PB 75) 2. Addition of Rs. 5,00,000/- as unexplained investment u/s 69. "The copy of regist ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rded language). Thereafter, the ld. CIT(A) after examining the record granted relief in the first appellate proceedings. 3.1 In the set aside appellate proceedings however, the ld. CIT(A) has now taken a complete U-turn and wrongly denied the admission and consideration of the additional evidences submitted earlier as also again repeated before him. 3.2 As a matter of fact, the said ITAT order was decided in absence of the Respondent-assessee and therefore the facts and the legal position could not be brought in the notice of the Hon'ble members of the ITAT, who decided the above appeal. 4. Case referred by the Deptt. is distinguishable: 4.1 It is respectfully submitted that the reliance placed by the, while restoring the issue to the file of the ld. CIT(A), in the case of CIT vs. Manish Buildwell 245 CTR 397 (Del.) is completely misplaced in as much as, the Hon'ble court has only relied upon Rule-463) which requires the Ld. CIT(A) to provide an opportunity of examining and rebutting the additional evidence by the ld. CIT(A). In that case the Ld. CIT(A) though admitted confirmatory letters produced by the assessee but the same were not confronted to the AO / no oppo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issued 28.12.2010 Only 4 days' time was granted by the AO for filing voluminous details. 5. 29.12.2010 -The AO passed the order. 30.09.2008 ROI Filed 5.1.2 The AO did not appreciate that the assessee at his best supplied the documents as required and filed its explanation as per queries raised by the AO However, the AO did not comply with the obligations as provided under the law. 5.1.3 It is pertinent to note that the return of income in this case was filed on 30.09.2008 whereas, the AO himself has taken around two years in commencing the process of hearing (the assessment proceeding). The first notice u/s 142(1) along with a letter 02.07.2010, through which the assessee was asked for the first time to submit various and voluminous details and clarification were sought. The case was entirely proceeded within Dec 2010 only (pls. ref. remand report CIT(A) pg.5). 5.1.4 From the above facts it is evident that firstly, it was not a case of granting repeated opportunities in as much as the AO issued show cause notice dated 24.12.2010, in which he asked the assessee voluminous details, after giving only four d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e information in soft form as S.132(1)(iib) requiring any person who is found to be in possession or control of any books of account or other documents maintained in the form of electronic record as defined in u/s 2(1)(t) of the I.T. Act, to afford the authorized officer the necessary facility to inspect such books of account or other documents; 5.2.4 Finance Act, 2009, of Section 282(1) (c) provides that service of notice in the electronic form. Thus, it is evident that the above provisions now recognize the complete assessment proceedings to be made electronically. This legal positions duly applies in the year under consideration in as much as the assessment was completed on 29.12.2010 (or in any case the proceedings were now open before the Ld. CIT(A) (in the second round) when he passed the order on 25.01.2016). Now a day, the Government and the legislature itself wants the assessee to upload all the bulky returns along with (enclosure-24) not only under the income tax return but also under provisions of the Companies Act and other Acts. The legislature must not have imagined that despite this legal position, the assessee will be asked to produce the bulky books of accounts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... u/s 251 (1) (a), necessitating (compulsory) admission of the evidence before him in the larger interest of justice. This matter has been dealt with elaborately in CIT vs. K. Ravindranathan Nayyar (2003) 184 CTR 46 (Ker.), which has held that the CIT (A) was not justified in rejecting the admission of confirmatory letter straight away on the plea that the case of the appellant does not fall under any of the circumstances given under clause (a) to (b) of Rule 46A (1). This ratio squarely applies on the facts of the present case. 6.2. Other supporting case laws: 6.2.1 In Pr. CIT v. Daljit Singh Sra [2017] 80 taxmann.com 271 (P&H) (DPB 1-5) held that: "In view of the above facts and circumstances, there is no doubt assessee did not co-operate with the Assessing Officer in completion of assessment proceedings but the fact remains that in the delivery of justice the real income of assessee has to be assessed and that too after hearing the assessee. The Commissioner (Appeals) has not commented upon the nature of evidence filed under rule 46A. Such evidence might have been relevant for the calculation of real income of the assessee, therefore, in view of the substantial justice, Comm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d also relied on the following case laws: (i) N.B. Surti Family Trust Vs CIT (2006) 153 Taxman 31 (Guj) & (ii) Kanniapaan Murugadoss Vs ITO, Non-corporate Ward 7(4), Chennai (2017) 79 taxmann.com 244 (Chennai-Trib). 6. Having considered the rival contentions and carefully perused the material available on record. From perusal of record, we observed that Section 254 of the Act read with Rule 29 of the Income Tax (Appellate Tribunal) Rules, 1963 states about power to admit additional evidences, whether mere fact that evidence sought to be produced is vital and important does not provide a substantial cause to allow its admission at appellate stage, especially when evidence was available to party at initial state and had not been produced at that time. Rule 46A of the Rules speaks about production of additional evidence before the [Deputy Commissioner (Appeals)] [and Commissioner (Appeals)]. The additional evidences submitted by the assessee at this stage are the first time and are necessary for deciding the appeal. Even otherwise, all the documents so placed on record by the assessee by way of additional evidences before the ld. CIT(A) are necessary to adjudicate the controversy ..... X X X X Extracts X X X X X X X X Extracts X X X X
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