TaxTMI 
TaxTMI 
1980 (4) TMI 30
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....e manufacture of tea as well as coffee. During the assessment proceedings for the assessment year 1967-68, the ITO doubted the genuineness of certain vouchers for the expenditure incurred in the course of the enquiry, the director-cum-secretary and the accountant who had filed the income-tax return conceded that some of the items of expenditure debited to the estate account could not be proved by them to the satisfaction of the ITO and that an addition of Rs. 1,20,000 as representing the expenses debited in the accounts but not proved to the satisfaction of the ITO may be made. Accordingly, in the assessment order dated May 15, 1968, the ITO made an addition of Rs. 1,20,000. It appears that during the discussion before the ITO the two offic....
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.... to question and certain proceedings had been taken by the Central Bureau of Investigation leading to suspicion that there had been mismanagement. The investigations are still pending. The Central Bureau of Investigation has seized all the records of the company and the return of the document including vouchers for the several expenditure has been refused. The company had been recently permitted by the order of the police court, Poonamallee, to have inspection of the records at Delhi. Under the above circumstances, the purported concession made by the officers of the company is unable to be ascertained by us. and finally they end by saying that " the purported concession made by the accountant and the secretary appear to be contrary to t....
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....e assessment year 1967-68. In the said appeal by oversight the appellant has omitted to raise a ground against the addition of Rs. 1,20,000 made by the Income-tax Officer. The fact and significance of the omission was not noticed till recently and the same was brought to the notice of the appellant when the Income-tax Appellate Tribunal elicited information relating to the quantum of assessment. The appellant submits that the omission to raise the ground earlier was not wilful but bona fide. There had been a change in the management of the company with the result that this aspect was overlooked. " The AAC rejected this application for raising additional grounds on the ground that the addition of Rs. 1,20,000 was made after a detailed dis....
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....tected only long later and that was the reason for the delayed action in questioning the addition. Though the Tribunal was prepared to accept this as justifiable ground for permission to raise additional grounds, it was of the view that this is a new case not set up either in the petition before the AAC, or in the explanation dated February 22, 1970, filed before the IAC, in connection with the penalty proceedings. It was also of the view that it is inconsistent with the original stand taken before the AAC. According to the Tribunal before the AAC, they had only pleaded that by oversight this ground was not raised. We are of the view that this understanding of the Tribunal of the case of the petitioner before the AAC was not correct. We hav....
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....ppellant only during the course of the discussion before the Appellate Tribunal in the penalty proceedings. Therefore, reference to the inability to ascertain the correct facts relating to the purported concession in the original letter dated February 22, 1970, cannot be interpreted as meaning that the management had no specific case about the alleged irregularity or concession as stated in the order of the Tribunal; nor can we agree with the view of the Tribunal that the case of the assessee before the AAC for raising additional grounds was merely an oversight. It is true, there is a statement to the effect that in the appeal, by oversight, the appellant had omitted to raise the grounds against the addition. But it should be read in the li....
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....ssion and it is for that reason they have not raised any ground relating to the addition. This reasoning of the AAC, therefore, is extraneous and irrelevant for the purpose of considering the permission to raise additional grounds. Under s. 250(5) " the Appellate Assistant Commissioner 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 Appellate Assistant Commissioner is satisfied that the omission of that ground from the form of appeal was not wilful or unreasonable. " As pointed out in Ramgopal Ganapatrai & Sons v. CEPT [1953] 24 ITR 362 (Bom), which dealt with the corresponding provision in s. 31(2A) of the Indian I.T. Act, 1922, this provision confers a po....