VIJAYSHEKAR REDDY CHAMA ,HYDERABAD vs. INCOME TAX OFFICER, WARD-8(2), HYDERABAD

The assessee has raised the following substantive grounds in the instant appeal : “ 2. The order of the learned CIT (Appeals) erred in confirming action of the Assessing Officer without considering the appellant submissions i.e. disallowing expenditure an amount of Rs.61,63,596.

We advert to the first and foremost substantive grievance that both the lower authorities have erred in law and on fact in disallowing expenditure amount of Rs.61,63,596. Learned CIT(A)’s detailed discussion to this effect reads as under :

The assessee's argument during the course of hearing is that he intends to file additional evidence qua the impugned purchases as well as liability thereof; if granted yet another opportunity be provided before the Assessing Officer. And also that the preceding assessment year 2014-15 had been rejection of books of accounts followed by estimation of profit @ 3% only whereas the learned lower authorities have adopted altogether a new course of action by disallowing the impugned expenditure. The learned departmental representative has strongly supported the impugned disallowance made by the lower authorities.

We have given our thoughtful consideration to rival pleadings. We, prima facie, notice that there is no indication either in the assessment or in the CIT(A) order as to the assessee's liability to pay the impugned Rs.61,63,596. Faced with this situation, we deem it appropriate to restore back to Assessing Officer with a rider that it shall be the taxpayer’s risk and responsibility only to produce all the relevant details in consequential hearing before the Assessing Officer who shall afford three effective opportunities only. The assessee or his learned authorised representative shall appear before the Assessing Officer on or before 30.11.2021 for further factual verification in above terms. This former substantive ground is treated as allowed for statistical purposes.

Coming to the assessee's latter substantive ground seeking to reverse unexplained credit addition of Rs.5 lakhs, learned counsel stated very clearly that the same be rejected as not pressed keeping in mind the smallness of the amount involved. Accordingly this ground is dismissed as not pressed.

We lastly acknowledge that although the instant appeals are being decided after a period of 90 days from the date of hearing as per Rule 34(5) of the IT(AT) Rules 1963, the same however, does not apply in the covid lockdown situation as per hon'ble apex court's recent directions dated 27-04-2021 in M.A.No.665/2021 in SM(W)C No.3/2020 'In Re Cognizance for (including that prescribed for institution as well as termination) shall stand excluded from 14th of March, 2021 till further orders. 8. This assessee's appeal is partly allowed for statistical purposes. Order pronounced in the open court on 2nd September , 2021.