TMI Blog2021 (12) TMI 645X X X X Extracts X X X X X X X X Extracts X X X X ..... he case we set aside the impugned order and remand the issue to the record of CIT(A) to decide the appeal afresh by passing a speaking order after getting the additional evidences to be verified from the AO - assessee be given an opportunity of hearing before passing fresh order. Though the assessee has supported the order of CIT(A) under Rule 27 of IT rules on the issue of validity of initiation of proceeding under section 153C of the Act which has been decided by CIT(A) against the assessee however, as we have remanded the matter to the record of the CIT(A) for fresh adjudication including the maintainability of the belated appeal therefore, this issue is kept open to be raised as per the outcome of the fresh order of CIT(A) - Appeals of the revenue are allowed for statistical purposes. - ITA No. 186 And 187/DDN/2019 - - - Dated:- 14-12-2021 - Shri R.K. Panda, Accountant Member And Shri V.P. Rao, Judicial Member For the Appellant : Sh. N.S. Jangpangi, CIT/DR For the Respondent : Sh. Kapil Goel, Advocate ORDER PER V.P. RAO, J.M. These two appeals by the Revenue are directed against two separate orders of CIT(A) dated 27.09.2019 and 30.09.2019 arisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6. On facts circumstances of the case and in law, the CIT(A) erred in not considering the objection raised by AO during the remand proceedings that sufficient opportunity was already provided and also failed to record any specific findings with reference to the circumstances under which the assessee was prevented from producing the evidence before the AO or on the genuineness and correctness of the claims raised by assessee nor has controverted this assertion of the AO in remand report, while admitting the addl. Evidence. 7. On facts circumstances of the case and in law, the CIT(A) erred in admitting the additional evidence at appellate stage without appreciating that the purpose of rule 46A is to ensure that evidence is primarily led before the Income-tax Officer as held in Rajkumar Srimall02 ITR 525 (Cal), Ganpatrai SonsLtd. 24 ITR 362 (Bom) 8. On facts and circumstances of the case and in law, the Ld. CIT(A) in law while deleting the additionsof 75,00,000 made in the assessment order on the grounds that there was no incriminating material, without appreciating thatthe pg no 32 to 43 of LP-20, which was a sale deed which recorded sale consideration of only 75, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... could suggest/divulge the undisclosed income without any further act of investigation/examination. The detailed examination of such material of having undisclosed material or not, is the step envisaged only after the issue of notice u/s 153C. 12. On facts and circumstances of the case and in law, the Ld. CIT(A) in law while deleting the addition of ₹ 73,00,000/- and ₹ 40,95,000/- without appreciating that in view of the amended provisions, the burden u/s 68 could not have been said to be discharged by assessee just by filing confirmations/financial statement for the first time at appellate stage in view of the ratio of decision in case of NR Portfolio Pvt. Ltd.264 CTR 258(Delhi), Nova promoters finlease Pvt Ltd 252 CTR 187(Delhi), Seema Jain 406 ITR 411 (Delhi). 13. That the CIT(A) failed to appreciate that no evidence was given during asstt proceedings and that during remand proceedings also the confirmations by itself would not discharge the burden u/s 68 unless the genuineness and creditworthiness of the creditors were also proved to the satisfaction of AO and that no such evidence was given before AO nor CIT(A) has recorded any specific finding on the ful ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cases on 21.11.2013. During the course of search and seizure action, certain material and documents belonging to the assessee were found. Assessing Officer of searched person forwarded those information and documents to the Assessing Officer of the assessee. Consequently, the Assessing Officer after recording his satisfaction issued notice u/s. 153C of the Act on 12.01.2016. Since nobody has appeared in response to the notice issued by the Assessing Officer nor any reply or details or requisite material/documents were filed, therefore, the Assessing Officer passed the assessment u/s. 153C read with section 144 of the Income Tax Act. Assessing Officer has made various additions based on the material found and seized during the search and seizure action and received from the Assessing Officer of the searched person. The Assessing Officer has made the addition on various accounts in para 3 to 6 as under : 3. Vide referred above show cause dated 12.08.2016 and 14.10.2016 the assessee was asked to furnish the evidence of source of investment in purchase of property of ₹ 75,00.000/- (Market Value ₹ 3,74,22,000/-) executed on 03.05.2011. The Assessee has failed to do so. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and advances. The CIT(A) forwarded the additional evidence to the Assessing Officer for his comments. The Assessing Officer in his remand report objected to the admission of additional evidence. The CIT(A) while passing the impugned order has rejected the remand report of the Assessing Officer and admitted the additional evidence and consequently, the addition made by the Assessing Officer was deleted. 9. At the time of hearing, ld. DR submitted that the CIT(A) has admitted additional evidence in complete violation of Rule 46A of the Income-tax Rules. Assessing Officer in his remand report has raised serious objections against additional evidence to be admitted. He has further submitted that even otherwise, the additional evidence admitted by the CIT(A) remained unverified, as the Assessing Officer was not given any opportunity to examine and verify the correctness of the additional evidence filed by the assessee. Thus, ld. DR has submitted that the impugned order of the CIT(A) be set aside and the order of the Assessing Officer be restored. 10. On the other hand, ld. AR of the assessee has submitted that all the transactions which are mentioned in the documents found during ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ount are related to the other assessment years. In this regard, a meticulous examination of seized documents with the explanation and supporting documents filed by the appellant was made by the undersigned and LP wise observation of the undersigned are as under; (A) Page No. 32 to 38 39 to 43 of LP-20 which containing purchase of land for ₹ 75,00.000/- (Market value ₹ 3.74.22.000/-) by the appellant company. This paper consist of sale deed of land which shows sale value of Rs, 75,00,000/-, The appellant has duly capitalized the land in its the Books of account. A perusal of Balance Sheet of appellant company shows that the said land is a part of Balance Sheet where inventories is disclosed at ₹ 97,46,000/- [₹ 75,00,000/- land + ₹ 22,46,000/- stamp duty] which clearly indicates that this LP-20 is properly reflected in Books of account of the appellant. (B) Page No. 16 of LP-2 containing the details of transactions of ₹ 73.00.000/- by the appellant company. This document pertains to the loan of ₹ 73,00,000/- to Shri Harshit Malik. In support of its contention, appellant has filed confirmation and other details from party, a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ton Mills Vs.CIT 26 ITR 775 has observed and held As regards the second contention, we are in entire agreement with the learned Solicitor-General when he says that the Income- tax Officer is not fettered by technical rules of evidence and pleadings, and that he is entitled to act on material which may not be accepted as evidence in a court of law, but there the agreement ends ; because it is equally clear that in making the assessment under sub-section (3) of Section 23 of the Act, the Income-tax Officer is not entitled to make a pure guess and make an assessment without reference to any evidence or any material at all. There must be something more than bare suspicion to support the assessment under Section 23(3). The rule of law on this subject has, in our opinion, been fairly and rightly stated by the Lahore High Court in the case of Seth Gurmukh Singh v. Commissioner of Income-tax, Punjab. Further, jurisdictional Hon'ble Allahabad High Court in the case of CIT vs. Sweta Kalyan Samiti [2013] 39 taxmann.com 21 (Allahabad) has held that When the A.O made addition on the basis of loose paper which has been incorporated in the books of account and no defect otherwise ..... X X X X Extracts X X X X X X X X Extracts X X X X
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