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Income Tax Appellate Tribunal, DELHI BENCH ‘SMC’ NEW DLEHI
Before: SHRI C.M. GARG
This appeal filed by the assessee is directed against the order dated 26.03.2019 passed by ld. CIT(A)- Ghaziabad for the assessment year 2015-16 on the following grounds : “1. That the Ld. Commissioner of Income Tax (Appeals) while passing the order has violated the principles of natural justice in not appreciating and allowing the additional evidence submitted before her to be allowed to be read in evidence.
2. That Ld. Commissioner of Income Tax (Appeals) has erred in dismissing the appeal in limine whereas even if she wishes to proceed without considering additional evidence she should have passed an order
considering the merits of the case as available on the record as well as law relating to the issue.
That on the facts and in the circumstances of the case, the L’d Lower Authorities have erred in rejecting the books of accounts of the assessee and although the audit report was available on record still the AO went on to estimate income of assessee @8% of the turnover which as wrongly been sustained as such by the L’d CIT (Appeals). Observations made inferences drawn and findings recorded are arbitrary and illegal.
Addressing to the grounds of appeal
, the ld. Counsel for the assessee submitted at the outset that the ld. CIT(A) while passing the impugned order was not justified in not admitting the additional evidences submitted before her for consideration u/r. 46A of the Income-tax Appellate Tribunal Rules, 1962 (“the Rules” for short). It was submitted that the assessment order was passed on the back of assessee u/s. 144 of the Income-tax Act, 1961 (“the Act” for short) and the assessee was afforded no reasonable opportunity to substantiate its case by filing documentary evidences before the Assessing Officer. Therefore, the ld. CIT(A) was not justified in denying the additional evidences submitted before her on technical ground, ignoring the explanation of assessee that the assessee could not avail an opportunity before the Assessing Officer as the Managing Director of the assessee company was ill. A Medical Certificate supported with affidavit was also filed before the first appellate authority, which have not been considered in right perspective. He, therefore, submitted that the denial of additional evidences by the ld. CIT(A), which go to the root of the matter, is in violation of Rule 46A of the Rules and the same may kindly be admitted at this stage. Ld. Counsel further submitted that the ld. CIT(A) was also not justified in deciding the appeal in limine without entering into the merits.
3. Replying to the above submissions, the ld. DR strongly supported the order of ld. CIT(A) and submitted that the assessee failed to completely fulfil the conditions laid down in Rule 46A, which rightly led the ld. CIT(A) to deny admission of additional evidences submitted before the first appellate authority for the first time.
4. On careful consideration of rival submissions, assessment order and first appellate order, I find that the ld. CIT(A) has denied the additional evidences furnished by the assessee before her, on the basis of alleged inconsistency of assessee’s stand mentioned in the facts given in Form 35 and the subsequent submissions made by assessee before her. It is not in dispute that the assessment order was passed ex parte u/s. 144 of the Act. The ld. CIT(A) has also not given any cogent finding on the authenticity of medical certificate supported by affidavit filed before her, as also incorporated in para 6.1.1 of the appellate order. No enquiry has been made by the ld. CIT(A) to check the veracity of assessee’s stand regarding ailment of Managing Director or the medical certificate filed in support thereof.
The affidavit filed by assessee also stood uncontroverted. Therefore, the medical certificate filed by the assessee cannot be doubted only on the basis of alleged inconsistency of facts given in Form-35 and the subsequent submissions of the assessee made before the first appellate authority. In my humble understanding, it is not proper to deny the additional evidences on the basis of alleged inconsistency in the facts given in Form 35 and those given in subsequent submissions, without making any enquiry as to the truthfulness of such stands of assessee. In such state of affairs, it can hardly be observed that the assessee had no reasonable cause for not attending the proceedings before the Assessing Officer. Therefore, in the interest of natural justice, the additional evidences, whatsoever, filed by assessee before the ld. CIT(A) are admitted on record for consideration. Since assessment order was passed u/s. 144 of the Act ex parte qua assessee and additional evidence has been admitted by us to serve purpose of justice, therefore, to avoid multiplicity of proceedings, the matter is restored to the file of the Assessing Officer for de novo adjudication after allowing due opportunity of hearing. Needless to say, the assessee will cooperate during proceedings.