AI Drafter 
TaxTMI 
TaxTMI 
TaxTMI 
2021 (3) TMI 990
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....e Tax Act, 1961 (in short 'the Act'). Heard Shri P.Murali Mohana Rao (AR) representing the assessees and Shri Rohit Muzumdar (DR) appearing for the Revenue; respectively. Case files perused. 2. It transpires at the outset that the learned lower authorities have framed the impugned re-assessments u/s 148/147 proceedings going the survey action dated 21.12.2009 conducted at the assessees' premises culminating in impugned identical additions in the nature of unexplained/unaccounted income(s) involving varying sums of money as upheld in the CIT(A)'s order. A perusal of the case files suggest that these two assessees have filed their identical petitions; both dated 27.7.2018, seeking to raise the following additional grounds of appeal. "26. As per the ratio laid down by the Hon'ble Supreme Court of India in the case of National Thermal Power Co. Ltd. Vs. CIT (1998) 229 ITR 383 (SC) the ITAT has jurisdiction to examine any question of law which though not raised before the CIT(A) but is raised before the ITAT for the first time. 27. The ld.AO erred in making the assessment u/s 143(3) r.w.s.147 without issuing notice u/s 143(2) which makes the assessment order inva....
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....A.Ys 2004-05 to 2007-08 (4 volumes); AY 2009-10 (1 vol) & home folder (1 vo.) 2.2. Learned authorised representative stated during the course of hearing that the assessee's identical petitions seeking admission of legal ground going to the root of the matter(s) deserve to be admitted since all the relevant facts already forms part of the records before us. 2.3. Learned departmental representative on the other hand has filed a detailed note opposing admission of assessee's additional grounds as follows: Before the Hon'ble ITAT, B Bench, Hyderabad Written Submission in the case of V V Narsimha Rao and V Laxminarayan ITA No. 352-355, 397-398/Hyd/2016 ITA No. 356-358, 395-396/Hyd/2016 The applicants V Narsimha Rao and V Laxminarayan have filed additional grounds of appeal and prayed to admit the same u/s 254 of the LT. Act. The applicants have relied upon the decisions in the cases of National Thermal Power Co. Ltd., (1998) 229 ITR, 383, as follows: "The Ld.AO erred in making the assessment uls 143(2) r.w.s 147 without issuing notice u/ s 143(2) which makes the assessment order invalid." In this regard it is humbly submitt....
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....d that the same could not have been raised earlier for good reasons. The AAC should exercise his discretion in permitting or not permitting the assessee to raise an additional ground in accordance with law and reason. The same observations would apply to appeals before the Tribunal also." In the present appeal, the appellant has not justified that the additional ground is bona fide and that there were valid reasons as to why these were not raised earlier. In the case of Batliboi & Co. Ltd. Vs DCIT(ITAT, Mum) 67 ITD 397, Mumbai ITAT held that the appellant has to satisfy Tribunal about existence of good reason for omission of such ground in original appeal memo and that the failure of assessee to give any reason additional ground could not be entertained. The appellate authorities if satisfied that the additional ground raised was bona fide and the same could not have been raised earlier for good reasons, may in its discretion, permit the assessee to raise an additional ground even after the expiry of the limitation provided for filing an appeal. The Tribunal has got the discretion to either admit the additional ground of appeal or not to admit the same. That the T....
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....hether in facts and circumstances of the case the provisions of section 73 could be invoked against the assessee when the assessee was squarely covered by Explanation of section 73 vide which the sale and purchase of shares by a company would not be speculative in nature in case its income was mainly derived from house property or capital gains or income of like nature? (iii) Whether in facts and circumstances of the case the Hon'ble Tribunal was right in law in holding that the brokerage paid was not an admissible expenditure under section 24 of the IT Act even though the rent actually received by the assessee or the tenant was after deducting the brokerage paid?" 6. We have heard learned counsel for the parties. 7. As regards question (i), we do not find any reason to take a view different from the view taken by the Tribunal. No doubt that an appellate authority can allow a question to be raised for the first time even if such a question was not raised at a lower forum but the discretion to do so has to be exercised in the interest of justice in the facts and circumstances and not mechanically. Normally a question of fact may not be allowed to be ra....
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....e to be declared null and void. There can hardly be any dispute about the settled legal position that such issuance of sec.143(2) notice is very much a mandatory condition before framing of an assessment; for re-assessment(s) including a best judgement assessment u/s 144 of the Act. Although the learned DR had sought to pin- point a distinction in the impugned best judgement assessment before us on the ground that the Assessing officer may proceed ex-parte and frame the assessment based on the facts on record after issuing sec.142(1) notice only, we find no merit in this line of argument since sec.143(2) procedure is a mandatory condition as propounded in hon'ble apex court's decision in Hotel Blue Moon case (supra). Such an issuance of notice is also a condition precedent in sec.144(1)(c ) before the Assessing officer proceeds in best judgement assessment as well therefore. 3.1. We also do not find any merit in Revenue's stand contesting assessee's petition(s) seeking admission of their additional grounds as extracted in preceding paragraphs. Hon'ble Apex Court's land mark judgement in NTPC vs. CIT 229 ITR 383, as considered in All Cargo Global Logistics Ltd. vs. DCIT (2012) 13....