1994 (11) TMI 39 - HC - Income Tax

High Court Upholds Tribunal's Decision on Additional Evidence in Income Tax Case

The High Court upheld the Tribunal's decision to refuse additional evidence in an income tax case, emphasizing that Rule 29 does not grant parties the ... Additional Evidence Issues Involved:The judgment involves the issue of declining to entertain additional evidence at the time of hearing of the appeal as per rule 29 of the Appellate Tribunal Rules.Details of the Judgment:The assessee, an individual, was assessed for the assessment year 1978-79 u/s 143(3) of the Income-tax Act, 1961. The Income-tax Officer treated the amount of Rs. 21,000 declared by the assessee as income from undisclosed sources. The Appellate Assistant Commissioner, after considering the bank account and the explanation provided by the assessee, deleted the addition of Rs. 21,000 as income from undisclosed sources. The Revenue appealed to the Tribunal, seeking to produce additional evidence in the form of a letter dated April 3, 1979. The Tribunal refused to admit the additional evidence, stating that it required investigation into facts and giving further opportunity to the assessee. The Tribunal upheld the order of the Appellate Assistant Commissioner and rejected the appeal of the Revenue.The Revenue, aggrieved by the Tribunal's refusal to admit additional evidence, approached the High Court for a reference on the question of law. Rule 29 of the Income-tax Appellate Tribunal deals with the production of additional evidence before the Tribunal. It restricts the parties from producing additional evidence but allows the Tribunal to require documents or witnesses for substantial cause. The Tribunal, in this case, did not find it necessary to require additional documents for passing orders based on the existing material. The High Court held that the Tribunal's decision not to admit the additional evidence was justified as the rule does not confer a right on parties to produce additional evidence, and the power lies with the Tribunal to request evidence if deemed necessary.The High Court rejected the Revenue's argument that the Tribunal should not refuse to admit additional evidence, emphasizing that rule 29 does not grant parties the right to produce additional evidence. The power to request evidence is vested in the Tribunal, which must record reasons for such a requirement. Since the Tribunal did not find it necessary to request additional evidence in this case, the High Court upheld the Tribunal's decision to refuse the additional evidence. Consequently, the High Court answered the question referred to it in the affirmative and against the Revenue, with no order as to costs in the circumstances of the case.