TMI Blog1993 (1) TMI 31X X X X Extracts X X X X X X X X Extracts X X X X ..... under section 216 ; (ii) in holding that (a) the assessee has taken reasonable care in preparing the basis for estimate and the basis so prepared is a well informed guess work ; (b) it is a bona fide estimate and it cannot be called an underestimate prepared deliberately ? 2. Whether, on the facts and in the circumstances of the case and also in view of the finding by the Income-tax Officer that the assessee had deliberately underestimated their liability to advance tax at 'nil', should not the Tribunal have sustained the order of the officer or remitted the case to the officer for de novo consideration ?" The respondent is a public limited company. We are concerned with the assessment year 1977-78. The accounting period ended on Decemb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appellate order, no interest was charged under section 216 of the Income-tax Act, 1961. On July 7, 1981, the Income-tax Officer served a notice on the assessee to show cause as to why interest under section 216 should not be charged. It is seen that the assessee filed its objection thereto on July 20, 1981. The plea of the assessee was that it has remitted more than the tax that will be due for the year if certain rectifications were carried out. Repelling the plea of the assessee, the Income-tax Officer held that the assessee has deliberately underestimated its liability and levied interest of Rs. 98,560 under section 216 of the Income-tax Act, 1961. For non-payment of advance tax due on June 15, 1976, an amount of Rs. 61,600 as interest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under section 216 was cancelled. It is thereafter at the instance of the Revenue and as directed by this court in Original Petition No. 1152 of 1986, that the Income-tax Appellate Tribunal has referred the two questions of law, formulated hereinabove, for the decision of this court. We heard counsel for the Revenue, Mr. P. K. R. Menon, and also counsel for the respondent-assessee, Mr. P. R. Raman. The arguments advanced before us covered a wide range. Suffice it to say that the way in which the Tribunal has disposed of the appeal is most unsatisfactory. As to whether the assessee has made a bona fide estimate and it cannot be called an underestimate prepared deliberately is a finding of fact. It is true that the Income-tax Appellate Tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... come-tax also do not form part of the paper book. In second appeal before the Tribunal, the assessee had a different explanation. It is seen from paragraph 4 of the order of the Tribunal that the assessee filed copies of the assessment order dated September 22, 1980, the revised assessment order dated March 16, 1981, the order passed by the Commissioner of Income-tax (Appeals) dated July 27, 1981, and photostat copies of the working of the estimate of advance tax payable for the assessment year 1977-78 prepared on June 14, 1976, and September 13, 1976. The plea made was that the estimate of advance tax was filed on June 15, 1976, based on the assessee's working results for five months up to May 31, 1976, and taking into account the unabsorb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nnot be called an underestimate prepared deliberately. For arriving at the said finding of fact, the Tribunal adverted to a plea which was taken before it for the first time. It was so done on the basis of the documents which were not before it in accordance with law. There is no material to show that the above documents were admitted as additional evidence in the appeal. No reason has been stated for receiving those documents at that stage. We do not find any one of the documents included in the paper book filed in this court. In this state of affairs, it is difficult to say whether the finding arrived at by the Tribunal is valid, based on any material or in accordance with law. We may at once say that though the finding of the Tribunal th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... court by the Income-tax Appellate Tribunal. We have already stated that the Appellate Tribunal has disposed of the appeal, relying on a plea which was put forward before it for the first time and on the basis of the documents produced before it for the first time. It is not stated that the documents were admitted as additional evidence in the appeal. We are of the view that the Tribunal committed a serious error in adverting to and relying upon the documents which were tendered before it for the first time, without admitting them as additional evidence in accordance with law. The procedure adopted by the Appellate Tribunal by relying upon fresh documents, without admitting them as additional evidence and without giving reasons, is grossl ..... X X X X Extracts X X X X X X X X Extracts X X X X
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