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2020 (10) TMI 141 - AT - Income TaxAppeal ex-parte decided by CIT-A - AO objected to admission of the additional evidence - As argued Audited financial statements and audited report could not be filed during the course of assessment proceedings due to factors entirely beyond the control of the assessee - HELD THAT:- Assessee did not file audited financial statements along with audit report either at the time of filing of return or during the course of assessment proceedings. It is the assessee’s contention that the same could not be done because of the some changes in the management. The bona fide of the assessee is lent credence by the fact that the assessee had also moved an application before the Company Law Board for compounding of offences requesting compounding for not filing the audited annual accounts. We also note that the correct income of the assessee can be determined only on the basis of the audited financial results and, therefore, it would be incorrect to shut out an assessee in the process of administration of justice from leading evidence to prove its case. The earlier inability to lead evidence should not be held against the assessee unless it is known to be incorrect or suggested to be incorrect or there was evidence to suspect that the evidence was fabricated. In the present case no such adverse inference has been drawn by the Ld. CIT (A). No prohibition for admitting the additional evidence at the appellate stage, though, the same may pertain to a period after completion of the assessment proceedings and the only condition is that the Revenue should not be prejudiced and that the AO should be given a reasonable opportunity to rebut the additional evidence. Audited financial statements and audited report could not be filed during the course of assessment proceedings due to factors entirely beyond the control of the assessee, in the interest of substantial justice, the AO should de-novo make the assessment after duly considering the audited financial statements and the audit report of the assessee - Appeal of the assessee stands allowed for statistical purposes.
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