TaxTMI 
TaxTMI 
2015 (11) TMI 190
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....he consent of the parties, ITA 84/15 as the leading case. 2. ITA 84/15 is filed by the Revenue, challenging the order passed by the Income Tax Appellate Tribunal, Cochin Bench in ITA No.612/2013. The respondent assessee is a partner in various business concerns and the other partners of these firms are the family members of the assessee. A search under Section 132 of the Income Tax Act (hereinafter referred as 'the Act') was conducted in the business premises of various firms and the residences of the partners on 26.3.2008. During the course of the search, various incriminating documents were found and seized and statements of the partners were also recorded. Consequent to the search, notices under Section 153A of the Act were issued for the assessment years 2002-2003 to 2007-2008 and notice under Section 142(1) of the Act was issued for the assessment year 2008-2009. In response to the notice under Section 153A of the Act, the assessee filed his returns of income on 10.7.2009 and on 13.7.2009, filed his regular return of income in response to the notice under Section 142(1) of the Act, for the assessment year 2008-2009. 3. The Assessing Officer completed assessment u....
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....e assessee as per bills/vouchers produced as fresh evidences were verified with the original bills/vouchers with dealers and the genuineness was verified. I have verified the original bills/vouchers from the following dealers for the period from 2.4.2010 to 3.8.2010 and found genuine. Sl. No Name of trader/dealer Period From To 1 KPK Oil Mills 2.4.2010 15.6.2010 2 Kottayam Rubbers 28.4.2010 19.7.2010 3 Anna Coconut Products 1.5.2010 3.6.2010 4 St. Joseph Oil Mills 2.5.2010 22.6.2010 5 Aloor Service Co. Op. Bank 1.6.2010 3.8.2010 6 Jeeva Bonemeal 21.7.2010 30.7.2010 It is pertinent to state that the agricultural income claimed to have earned by the assessee is for the assessment year 2010-2011 and not for the period under the search assessment period. 22. Receipt from sale of trees: The required particulars i.e. inflow in the cash flow statement, details of sale of tree and agreement with purchasers etc. were produced before the appellate authority as fresh evidence. These were not produced at the time of assessment proceedings. 23. Investment in immovabl....
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.... filed by the appellant are admitted and adjudicated in this appeal." 6. Challenging Annexure B order,Revenue filed appeals before the Tribunal. Cross Objections were also filed by the assessee impugning Annexure B to the extent it was against him. By Annexure E common order rendered on 10th October 2014, the appeal and Cross Objection were dismissed by the Tribunal. 7. In its order, the Tribunal has stated that the first common ground in all the appeals that were considered was with regard to the admission of fresh/new evidences filed by the assessee before the Commissioner of Income Tax (Appeals) without satisfying the conditions laid down in Rule 46A of the Rules. In paragraph 4 to 9 of its order, the Tribunal dealt with the above contention in the light of the provisions contained in Section 250 of the Income Tax Act and Rule 46A of the Rules. In conclusion, the Tribunal held that it did not find any merit in the contention urged by the Revenue and accordingly, the contention was rejected. Thereafter, the Tribunal examined the other contentions and, as already stated, dismissed the appeals and cross objections. It is aggrieved by these orders passed by the Tribunal that t....
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....and required the Assessing Officer to examine the new evidences/details/submissions and to give his report. 12. It was in response to that letter of the First Appellate Authority that the Assessing Officer submitted Annexure C Remand Report. Reading of this Report shows that in paragraphs 1 to 19, the Assessing Officer has justified his conclusions in the assessment order. Thereafter, from paragraph 20 onwards, extracted above, he dealt with the additional materials that were produced by the assessee before the First Appellate Authority. This report shows that insofar as the agricultural income earned by the assessee, after stating that the bills/vouchers produced by the assessee were found genuine, all that the Assessing Officer has stated is that the period pertains to the assessment year 2010-2011 and not the period under the search assessment. Insofar as the remaining issues are concerned, although each one of them were separately dealt with, all that he has stated is that the claim of the assessee may be rejected for the reason that the materials mentioned were not produced at the time of assessment. 13. It was considering this report submitted by the Assessing Officer that....
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.... examination of any witness, to enable him to dispose of the appeal, or for any other substantial cause including the enhancement of the assessment or penalty (whether on his own motion or on the request of the [Assessing Officer] under clause (a) of sub-section (1) of section 251 or the imposition of penalty under section 271.]" 15. Reading of this provision shows except on establishing the circumstances enumerated in clauses (a) to (d) under sub rule 1, an appellant shall not be entitled to produce the Commissioner (Appeals) any evidence whether oral or documentary. Sub rule 2 mandates that the Commissioner (Appeals) shall not admit any evidence, unless he records in writing the reasons for its admission. Once the documents are so admitted, sub rule 3 comes into operation, which further mandates that the Commissioner (Appeals) shall not take into account any evidence produced under sub rule 1 unless the Assessing Officer has been allowed a reasonable opportunity to examine the evidence or document or to cross examine the witnesses produced by the appellant or to produce any evidence in rebuttal of the additional evidence. Insofar as this sub rule is concerned, as we have alrea....
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....) The [Commissioner (Appeals)] may, at the hearing of an appeal, allow the appellant to go into any ground of appeal not specified in the grounds of appeal, if the [Commissioner (Appeals)] is satisfied that the omission of that ground from the form of appeal was not wilful or unreasonable. (6) The order of the [Commissioner (Appeals] disposing of the appeal shall be in writing and shall state the points for determination, the decision thereon and the reason for the decision. [(6A) In every appeal, the Commissioner (Appeals), where it is possible, may hear and decide such appeal within a period of one year from the end of the financial year in which such appeal is filed before him under sub-section (1) of section 246A.] (7) On the disposal of the appeal, the [Commissioner (Appeals)] shall communicate the order passed by him to the assessee and to the [Principal Chief Commissioner or] [Chief Commissioner or [Principal Commissioner or Commissioner]" 18. Reading of sub section 4 shows that the Commissioner (Appeals) may, before disposing of any appeal, make such further inquiry as he thinks fit, or may direct the Assessing Officer to make further inquiry and report the resu....
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....e powers of the Appellate Assistant Commissioner to make further enquiry or to direct the Income tax officer to make further enquiry and to report the result of the same to him. This position has been made clear by sub rule (4) which specifically provides that the restrictions placed on the production of additional evidence by the appellant would not affect the powers of the Appellate Assistant Commissioner to call for the production of any document or the examination of any witness to enable him to dispose of the appeal. Under sub-section (4) of section 250 of the Act, the Appellate Assistant Commissioner is empowered to make such further inquiry as he thinks fit or to direct the Income tax officer to make further inquiry and to report the result of the same to him. Sub-section (5) of section 250 of the Act empowers the Appellate Assistant Commissioner to allow the appellant, at the hearing of the appeal, to go into any ground of appeal not specified in the grounds of appeal, on his being satisfied that the omission of the ground from the form of appeal was not wilful. It is clear from the above provisions that the powers of the Appellate Assistant Commissioner are much wider than....
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.... that the first appellate authority should invariably consult or confront the assessing officer every time an additional evidence that was not filed before the assessing officer comes on the record of the first appellate authority. Where the additional evidence is obtained by the first appellate authority on its own motion, there is no requirement in law to consult/confront the assessing officer with such additional evidence. There may be cases where additional evidence is admitted by the first appellate authority on a request or application being made by the assessee. In such cases sub rule (2) of rule 46A requires the first appellate authority to allow the assessing officer a further opportunity to rebut the fresh evidence filed by the assessee. Even that requirement cannot be said to be a rule of universal application. If the additional evidence furnished by the assessee before the appellate authority is in the nature of clinching evidence leaving no further room for any doubt or controversy in such a case no useful purpose served on performing the ritual of forwarding the evidence/material to the assessing officer and obtain his report. In such exceptional circumstances the req....