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TMI Blog2015 (5) TMI 579X X X X Extracts X X X X X X X X Extracts X X X X ..... Tax Act, 1961, were not applicable in the case of trading receipts and the addition was wholly unwarranted and unsustainable in law and on facts. 3. That the Order of the Ld. C.I.T.(A), being erroneous in law and on facts deserves to be quashed. 4. That without prejudice to the grounds of appeal No. 1 and 2, the order of the Ld. C.I.T.(A) is insupportable in law and on facts and in any case the additions confirmed are extremely unjustified, much too high and excessive. That any other relief or reliefs as may be deemed fit in the facts and circumstances of the case may be granted. 2. During the course of hearing, the ld. counsel for the assessee has moved an application for admission of the following additional ground for the reason that since the ground goes to the root of the case, the same may be admitted and be disposed of:- "6. That the Ld. A.O. and Appellate Authority who have dealt with the assessment under appeal have failed to consider and appreciate that the provision of the section 153C of the Income Tax Act, 1961, could not have been taken without first recording reasons in some case pending before the same or any other Assessing Officer under section 153A of the Inc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isdiction is very limited, as the Assessing Officer assumes jurisdiction to adjudicate a particular issue by virtue of the order of the appellate authorities. Therefore, the additional ground cannot be admitted at this stage. The ld. D.R. has further invited our attention to the judgment of the jurisdictional High Court in the case of Digvijay Chemicals Ltd. vs. ACIT, 248 ITR 381, in which their Lordships of the jurisdictional High Court has held that there is no requirement to afford opportunity of hearing to a party before recording satisfaction under section 158BD of the Act. After all, opportunity of hearing has to be given to the assessee before making assessment and hence it would be unreasonable to require any other opportunity of hearing before recording the satisfaction. Their Lordships has further held that moreover section 158BD of the Act does not require giving of opportunity, as satisfaction is not a quasi judicial order but an administrative order. It was also held by their Lordships that there is nothing in section 158BD of the Act that satisfaction must be recorded in writing. This judgment was rendered on 8th December, 2000 and the Assessing Officer has issued not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CIT (DR) pointed out that in the instant case, the assessee has not established creditworthiness and the identity of the creditors. At this stage, Shri Ashwani Kumar, CA and Shri Sudhindra Jain, CA, Ld. Counsels for the assessee agreed that the assessee will produce the creditors before the AO examination if an opportunity is allowed by the Tribunal. Considering the entire facts and circumstances of the present case, we set aside the order of the Ld. CIT (A) on this issue and remand the matter to the file of the AO with a direction to decide the issue afresh in accordance with law after examining the creditors. It is made clear that the assessee is free to adduce evidence before the Assessing Officer in support of its case. It is needless to say that the Assessing Officer will given an opportunity of being heard to the assessee." 8. Pursuant to the directions of the Tribunal, the Assessing Officer has examined the issue of addition of Rs. 10 lakhs after affording an opportunity of being heard to the assessee and when he was not convinced with the explanations of the assessee, the addition was again confirmed, against which an appeal was filed before the ld. CIT(A) and finding no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orities and being legal in nature, additional ground was directed to be admitted by the first or second appellate authorities. In this regard, there is no quarrel. The issue before us is only whether such type of additional ground can be raised in the second round of appeal where the scope of lower authorities are very limited. Reliance was placed upon the judgment of the Hon'ble Allahabad High Court in the case of Smt. Prabha Rani Agrawal vs. Income Tax Officer [2013] 33 taxmann.com 617 and in this case also we find that the additional ground was raised in the first round of appeal. Therefore, we are of the considered opinion that the additional ground, which does not require any further enquiry or investigation, can be admitted at any stage by the appellate authorities in first round of appeal where the adjudicating authorities has vast discretion, but in the second round of appeal, where the Assessing Officer and the first appellate authorities has limited jurisdiction to adjudicate any those issues which were directed to be examined by the appellate authorities because the Assessing Officer assumes jurisdiction to adjudicate those issue from the orders of the appellate auth ..... X X X X Extracts X X X X X X X X Extracts X X X X
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