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Income Tax Appellate Tribunal, JAIPUR BENCHES,”B” JAIPUR
Before: SHRI SANDEEP GOSAIN, JM & SHRI VIKRAM SINGH YADAV, AM vk;dj vihy la-@ITA. No. 105/JP/2020
CO. No. 06/JP/2020 (Arising out of fu/kZkj.k o"kZ@Assessment Years : 2014-15 cuke Shri Vinit Kumar Bora The DCIT, 3rd Crossing, 2532, Oswal Sadan, Vs. Circle-2, MSB Ka Rasta, Johri Bazar, Jaipur. Jaipur. LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: AHCPB 0047 K vihykFkhZ@Appellant izR;FkhZ@Respondent jktLo dh vksj ls@ Revenue by : Shri B.K. Gupta (Pr.CIT) fu/kZkfjrh dh vksj ls@ Assessee by : None (W.S.) a lquokbZ dh rkjh[k@ Date of Hearing : 20/10/2021 mn?kks"k.kk dh rkjh[k@Date of Pronouncement : 08/11/2021 vkns'k@ ORDER PER: VIKRAM SINGH YADAV, A.M.
This is an appeal filed by the Revenue and the Cross Objection filed by the assessee against the order of the ld. CIT(A)-1, Jaipur dated 29.11.2019 pertaining to assessment year 2014-15 wherein the respective grounds of appeal are as under:-
: “1. Whether on the facts and in the circumstances of the case and in law, the CIT(A) was justified in deleting the addition of Rs. 3,46,55,469/- made u/s 41(1) of the Act on the ground that the assessee has offered income of Rs. 3,46,70,618/- in A.Y. 2019-20 after detection of the same by the Assessing Officer in A.Y. 2014-15? 2. Whether on the facts and in the circumstances of the case and in law the CIT(A) was justified in admitting new facts filed by the assessee in November, 2019 without providing as opportunity to the AO as prescribed under Rule 46A of the I.T. Act?” CO No. 06/JP/2020: “1. Whether the liabilities relating to advance received from the foreign buyers as accepted in the order for A.Y. 2010-11 to 2013-14 passed u/s 143(3) are in the nature of trading liability ceased to exist as concluded by the A.O. to tax u/s 41(1) and also not adjudicated by the CIT(Appeals).
Whether the provisions of section 41(1) of the Act be invoked in case of liabilities of advances received without establishing that any benefit thereof or for expenditure was claimed in earlier years.
Whether the amount of Rs. 346,55,469/- be subject to tax arbitrarily without establishing that how the same is in the nature of trading liability and whether provisions of section 41(1) can be invoked in respect of any liability appearing in the Balance Sheet despite being admitted in the earlier assessment years in orders u/s 143(3) that the outstanding amount is being not in the nature of trading liability.”
2. None appeared on behalf of the assessee. However, it is noted that the ld. AR of the assessee, Shri S.C. Jain has submitted an application stating that he has undergone major spinal surgery and Doctors have advised him against any physical movement and therefore, he has prayed that his written submissions prepared and filed in respect of grounds of appeal taken by the Revenue and Cross objection filed by the assessee may be considered while disposing off the respective appeals.
3. During the course of hearing, the ld. Pr.CIT/DR has submitted that the ld. CIT(A) has deleted the additions of Rs.3,46,55,469/- made by the Assessing Officer U/s 41(1) of the Act on the ground that the assessee has offered income of Rs. 3,46,70,618/- in subsequent assessment year i.e. A.Y. 2019-20. It was submitted that the assessee has taken said action of offering income after detection of the same by the Assessing Officer while passing the assessment order for the impugned assessment year i.e. 2014-15. It was further submitted that the ld. CIT(A) has admitted certain new facts by way of additional evidences which have been filed by the assessee during the course of appellate proceedings in November, 2019 without providing an opportunity of examination by the Assessing officer as prescribed under Rule 46A of the Income Tax Rules and thereby, violating the principles of natural justice and our reference was drawn to the findings of the ld. CIT(A) at para 3.1.2 (ii), (viii) and (ix) and it was submitted that from the said findings of the ld. CIT(A), it cannot be noted that the assessee has made certain further submissions vide letter dated 18.11.2019 and filed certain additional documentation and information and which have not been confronted to the Assessing Officer and also no opportunity has been provided to the Assessing Officer before taking those additional submissions and documentation on record. It was accordingly submitted that the matter may be set-aside to the file of the ld. CIT(A) with the direction to decide the matter afresh after providing adequate opportunity to the Assessing officer.
It was further submitted by the ld. Pr.CIT/DR that the assessee in his Cross Objection have also raised the grounds as to whether advances received from the foreign buyers are in the nature of trading liability which have ceased to exist as concluded by the Assessing officer and whether the provisions of Section 41(1) of the Act have been rightly invoked by the Assessing Officer. It was submitted that the said issue has not been adjudicated upon by the ld. CIT(A) and which has also been challenged by the assessee in his Cross Objection. It was accordingly submitted that taking into consideration the entirety facts and circumstances of the case, the matter may be set aside to the file of ld. CIT(A) to decide the same afresh including grounds raised by the assessee in his Cross Objection after providing reasonable opportunity to the assessee as well as to the Assessing officer.
We have heard the contentions advanced by the ld. Pr.CIT/DR and have also gone through the written submissions filed by the ld. AR on behalf of the assessee and other material available on record. We agree with the contentions advanced by the ld. Pr. CIT/DR that the matter deserves to be set aside to the file of ld. CIT(A) for the reason that firstly, legality of invocation of provisions of Section 41(1) have not been adjudicated upon by the ld. CIT(A) though assessee took a specific ground of appeal before the ld CIT(A) and which has now been contested by the assessee in his cross objection. Secondly, the fact that certain additional facts and documentation/information have been brought on record by the assessee during the appellate proceedings pertaining to the subsequent assessment year which were not available on record at the time of passing of the assessment order and thus, clearly in the nature of additional evidence produced and brought to the notice of the ld CIT(A) for the first time during the appellate proceedings and which have been taken on record by the ld. CIT(A) without considering the provisions of Rule 46A especially in terms of providing an adequate opportunity to the Assessing Officer to examine such additional evidence before such additional evidences were taken on record. It is no doubt the discretion of the ld CIT(A) to consider ad admit such additional evidence however, the Assessing officer should have been provided an opportunity to examine such additional evidence and taking into consideration, the report of the Assessing officer, the ld CIT(A) could have proceeded further which apparently has not happened in the instant case. Therefore, we are of the considered view that the matter deserved to be set-aside to the file of the ld CIT(A) to examine the same afresh as per law after providing reasonable opportunity to both the parties.
6 & CO No. 06/JP/2020 DCIT vs. Shri Vinit Kumar Bora 6. The contentions on merit in relation to respective grounds of appeal are therefore left open and the parties are at liberty, if so advised, to raise the same before the ld CIT(A) who shall consider the same as per law.
In the result, appeal of the Revenue as well as Cross Objection filed by the assessee is allowed for statistical purposes.