Assessee's appeal allowed for statistical purposes under Section 56(2)(viia) with matter restored for fresh adjudication considering additional evidence

ITAT Raipur allowed the assessee's appeal for statistical purposes regarding addition under section 56(2)(viia). The CIT(A) had dismissed the assessee's appeal and made proper calculations for the addition. While ITAT found no infirmity in CIT(A)'s order and rejected claims of denial of natural justice, it restored the matter to CIT(A) for fresh adjudication to consider additional evidence that could not be submitted earlier before revenue authorities, ensuring interests of justice.

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Issues Involved:
1. Legality of the ex-parte appellate order passed by the CIT(A) u/s 250 of the Income Tax Act, 1961.
2. Confirmation of addition of Rs. 5,16,16,970/- by the AO invoking provisions of section 56(2)(viia) of the Act.
3. Admission of additional evidence by the assessee.

Summary of Judgment:

Issue 1: Legality of the Ex-Parte Appellate Order
The assessee contended that the ex-parte appellate order passed by the CIT(A) u/s 250 of the Income Tax Act, 1961, was unjustified, bad in law, and against the principles of natural justice. The Tribunal observed that the CIT(A) had provided several opportunities for the assessee to be heard, but the assessee failed to appear on multiple occasions. Consequently, the Tribunal found no merit in the contention that the order was passed without providing a reasonable opportunity of being heard. Thus, the ground raised by the assessee was rejected.

Issue 2: Confirmation of Addition of Rs. 5,16,16,970/-
The AO had made an addition of Rs. 5,16,16,970/- by invoking the provisions of section 56(2)(viia) of the Act, which was confirmed by the CIT(A). The Tribunal noted that the assessee had invested in shares at a face value lower than the fair market value, resulting in a profit. The CIT(A) had calculated the addition correctly, and since the assessee did not dislodge these calculations, the Tribunal found no infirmity in the order of the CIT(A). However, due to additional evidence submitted by the assessee, the Tribunal decided to restore the matter to the CIT(A) for fresh adjudication.

Issue 3: Admission of Additional Evidence
The assessee submitted an application for the admission of additional evidence, citing reasons for not being able to present these documents earlier. The Tribunal acknowledged the reasons provided and admitted the additional evidence. The Tribunal referred to a similar case in the assessee's own matter for AY 2012-13 & 2013-14, where the matter was set aside to the CIT(A) for fresh adjudication. Following this precedent, the Tribunal restored the present appeal to the CIT(A) for re-adjudication after considering the additional evidence.

Conclusion:
The Tribunal allowed the appeal for statistical purposes, directing the CIT(A) to re-adjudicate the matter after considering the additional documentary evidence. The CIT(A) is to afford a reasonable opportunity of being heard to the assessee during the set-aside proceedings. The order was pronounced in the open court on 07/03/2024.

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