Rule 46A(3) requires remand opportunity before relying on additional evidence, leading to fresh assessment.

Where the first appellate authority admits additional evidence to explain cash deposits, Rule 46A(3) requires that the Assessing Officer be given an opportunity to examine the material and respond before the appellate order is finalised. Here, agreements and written submissions were relied on without forwarding them for remand proceedings or obtaining the Assessing Officer's comments, so the appellate order was procedurally unsustainable. The order was set aside and the matter remitted for de novo assessment, leaving the merits of the cash-deposit addition open for reconsideration.

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Issues: Whether the order of the first appellate authority, which restricted the cash-deposit addition on the basis of materials furnished before it without obtaining a remand report from the Assessing Officer, was sustainable, and whether the matter required remand for fresh assessment.

Analysis: The assessee had produced additional material before the first appellate authority, including agreements and written submissions, to explain the source and character of the cash deposits and the nature of the receipts. The record showed that these materials were not forwarded to the Assessing Officer for comments or remand proceedings. In such a situation, Rule 46A(3) required an opportunity to the Assessing Officer to examine the additional evidence and respond to it. The absence of a remand report and the failure to follow the mandatory procedure meant that the appellate order was passed in breach of the prescribed procedure and could not be sustained on that basis.

Conclusion: The appellate order was set aside and the matter was remitted to the Assessing Officer for de novo assessment after considering the explanation and evidence produced by the assessee.

Final Conclusion: The assessee obtained a remand for fresh adjudication, while the merits of the additions were left open for reconsideration by the Assessing Officer.

Ratio Decidendi: Where additional evidence is entertained at the appellate stage, the Assessing Officer must be afforded a statutory opportunity to examine it and offer comments before the appellate order is finalised.

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