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Facts
The assessee filed appeals challenging various assessment orders. The assessee sought to raise additional grounds related to the reopening of assessment, arguing it was done mechanically and without proper application of mind. The assessee also sought to lead additional evidence, including statements that were not originally provided.
Held
The Tribunal allowed the assessee's application to raise additional grounds and lead additional evidence. The matter was restored back to the CIT(A) for fresh adjudication on merits, ensuring adequate opportunity for both parties.
Key Issues
Whether the reopening of assessment was valid and whether the assessee should be allowed to raise additional grounds and lead additional evidence.
Sections Cited
148, 250, 80IC, 68
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Income Tax Appellate Tribunal, “D” BENCH, MUMBAI
Before: SHRI SANDEEP GOSAIN & SHRI PRABHASH SHANKAR
Date of Hearing 13.08.2025 Date of Pronouncement 15.09.2025 ORDER Per: SHRI. SANDEEP GOSAIN, J.M.:
The present appeals have been filed by the assessee challenging the different impugned orders passed under section 250 of the Income Tax Act, 1961 (‘the Act’), by the National Faceless Appeal Centre (NFAC) / CIT(A) for the assessment year 2006-07, 2007-08, 2008-09, 2009-10, 2010- 11, 2012-13 & 2013-14.
2 Rajkishore Maniyar, Mumbai. 2. Since all the issues involved in these two appeals are common and identical, therefore, they have been clubbed, heard together and consolidated order is being passed for the sake of convenience and brevity. Firstly, we take A.Y 2006-07 A.Y 2006-07
At the very outset, we noticed that in Appeal No. 2487/Mum/2024 for A.Y 2006-07 the assessee has challenged the reopening of assessment. According to assessee reassessment was challenged on various grounds but Ld. CIT(A) did not deal with each of the grounds specifically and had dealt with reopening of assessment in summary manner in its order. The specific issues raised by the assessee were not dealt with, therefore assessee has now filed an application for raising additional grounds and the same is reproduced herein below:
Filing of petition for additional grounds of appeal
The Appellant is moving this petition to admit the additional Grounds of Appeal. The Grounds relate to re-opening of Assessment some of which were raised before the Appellate Authority but were inadvertently left out. The Additional Ground being a legal ground and facts are already on record, therefore the same may be permitted to be raised now before your Honours by way of Additional Grounds. Some of these Grounds were raised before the CIT- (A) but were inadvertently not raised in this Appeal. The additional grounds, being legal ground the Appellant may be permitted to raise the same and the same may be adjudicated. The Appellant prays that, if there is any delay in filing the additional ground, the same may be condoned.
3 Rajkishore Maniyar, Mumbai.
We are relying on the ratio of following Judgments for raising the Additional Grounds. 187 ITR 688 (SC) Jute Corporation of India Ltd. vs. CIT 229 ITR 383 (SC) National Thermal Power Co. Ltd. vs. CIT The appellant prays that the Additional grounds of appeal may be admitted. We hope and trust that your honour will accede to our request and oblige. Additional Grounds of appeal:
1. The Re-opening of the Assessment u/s 148 of the Income- tax Act, 1961, is erroneous and bad in law.
2. The Re-opening of the Assessment u/s 148 of the Income- tax Act, 1961, is erroneous and bad in law as no copy of sanction granted was provided to the Appellant.
3. The Re-opening of the Assessment u/s 148 of the Income- tax Act, 1961, is erroneous and bad in law as the reasons recorded provided to the Appellant were not issued by the Officer that issued the Notice u/s 148 of the Act.
4. The Re-opening of the Assessment u/s 148 of the Income- tax Act, 1961, is erroneous and bad in law as the AO has not furnished the original reasons recorded for reopening.
5. The Re-opening of the Assessment u/s 148 of the Income- tax Act, 1961, is erroneous and bad in law as the reasons for re-opening furnished to the Appellant clearly show that the re- opening was done mechanically on the basis of report of investigation wing without any further inquiries made and the Assessment concluded for the Appellant in the year 2006-07 without due application of mind.
6. The Re-opening of the Assessment u/s 148 of the Income- tax Act, 1961, is erroneous and bad in law as it is based on a 'change of opinion' with respect of a concluded Assessment and is mechanical in nature and without any new 'tangible material'.
7. The Re-opening of the Assessment u/s 148 of the Income- tax Act, 1961, is erroneous and bad in law as the order purporting to dispose off objections to the reason for re- opening is not a speaking order but merely depends upon the investigation wing report.
4 Rajkishore Maniyar, Mumbai.
8. The Re-opening of the Assessment u/s 148 of the Income- tax Act, 1961, and the consequent Assessment order is erroneous and bad in law as it is on violation of principles of natural justice as a copy of the statements of various based on which re-opening and consequent additions were made were not furnished to the Appellant.
The Addition and disallowance made in the hands of the Appellant is erroneous and bad in law as it is on violation of principles of natural justice as a copy of the statements of various parties based on which additions were made were not furnished to the Appellant.
10. The Ld. CIT(A) erred in confirming the disallowance of the claim u/s 80IC of the Income-tax Act, 1961, as made by the Assessing officer. 11. The Assessing Officer erred in making an addition of the entire sale of the year while disallowing all the expenditures of the year without rejecting the books of accounts of the Assessee. 12. The Assessing Officer erred in making an addition of the entire sale of the year while disallowing all the expenditures of the year without appreciating that expenditure for earning Income is allowable business expenditure.
The Ld. CIT(A) erred in relying upon an interim remand report which was not completely legible while adjudicating the appeal of the Appellant.
The respondent craves leave to add, amend, alter or vary the grounds at the time of or before the date of the hearing.
On the Contrary Ld. DR contested the said application and submitted that no additional ground can be raised at this stage.
We have heard the counsels for both the parties, perused the material available on record, judgements cited before us and also the order passed by the revenue
5 Rajkishore Maniyar, Mumbai. authorities. From the records we noticed that although for A.Ys 2006-07, 2007-8, 2008-09 & 2009-10, the assessee has challenged the reopening of assessment but Ld. CIT(A) has not specifically dealt with the reopening of the assessment and has decided in a summary manner. Now the additional grounds raised by the assessee are more specific and goes to the roots of the case. We are of the view that for deciding the same, necessary records are required to be verified or the records are to be called from the department. These grounds now raised by the assessee are not forming part of Form No. 36, although these grounds are legal in nature and goes to the roots of the case to challenge the jurisdiction of the AO to carry out reassessment, therefore taking into consideration the principles laid down by Hon’ble Supreme Court in the case of The Jute Corporation India Ltd., Vs. CIT, 187 ITR 688 and The NTPC Vs. CIT, 229 ITR 383 and also considering the facts of the present case, we allow the application for raising the additional grounds and restore the matter back to the file of Ld. CIT(A) to decide all the grounds on merits after providing adequate opportunity of hearing to the parties.
Apart from the above, the assessee has also filed appeals bearing Nos. 3191, 3190 & 3355/Mum/2024 for A.Ys. 2010-11, 2012-13 and 2013-14 and had submitted that since the appeal for A.Y 2010-11 was selected for scrutiny vide letter dated 12.06.2012. However when the scrutiny was ongoing for A.Y 2010-11 an information was 6 Rajkishore Maniyar, Mumbai. received from DDIT(Inv), Unit -32, Mumbai, which concluded that the assessee did not conduct any business activity. The said statements were never provided to the assessee however through other authorities the assessee received report on the statement given by Mr. Huang. Thus to bring on record the said statement, the assessee has filed an application for leading additional evidence for A.Ys 2006-07, 2007-08, 2008-09, 2009-10, 2010-11 & 2013-14. As per assessee these statement also goes to the roots of the issue which proves that reopening of assessment and the additions made on merits are on a fundamental wrong footing. It was further submitted that the documentary evidences placed on record by assessee before both the authorities in the form of invoices and the customs documents / remittances have also not been considered. Since the reopening of assessment for A.Ys: 2006-07, 2007-08, 2008-09 and 2009-10 is also based on the order passed for A.Y 2010-11 and CIT(A) while passing order of A.Y 2010-11 relies heavily on the orders for the earlier years, therefore these appeals are connected and have strong bearing on each other.
On the other hand Ld. DR contested the said request of the assessee for leading additional evidence at this stage.
We have heard the counsels for both the parties, perused the material placed on record, judgments cited before us and also the orders passed by the revenue
7 Rajkishore Maniyar, Mumbai. authorities. From the records we noticed that assessment for A.Y 2013-14 was carried on by making addition u/s 68 of the act as unexplained cash credit based on withdrawal and deposit made by the assessee in his bank account as well as the bank account of his proprietorship and carry forward of loss due to no business activity in the current and previous years. The loss was disallowed in the instant years on the basis of findings in previous year. With regard to the Ground No. 2 for A.Y 2013-14, the AO made addition u/s 68 despite documents being produced and reconciliation given. As per assessee the documents in question could not be produced and submitted before Ld. CIT(A), however the same were available before the AO. Similarly in A.Y 2012-13, the AO has made addition u/s 68 without refuting any of the contention of assessee and the Ld. CIT(A) has confirmed the same without making any analysis of the evidences and reconciliation put before him.
8. It was submitted that specific ground No. 2 has been taken in Form No. 36 that the CIT(A) had not considered the submissions made by the assessee before him and has not passed any speaking order. Therefore considering the totality of the facts and circumstance of the present case we admit the request of assessee for leading additional evidence in all the above appeals and restore the matter back to the file of Ld.CIT(A) for deciding the same afresh after providing adequate opportunity of hearing to the parties.
8 Rajkishore Maniyar, Mumbai. 9. Before parting, we make it clear that our decision to restore the matter back to the file of the CIT(A) shall in no way be construed as having any reflection or expression on the merits of the dispute, which shall be adjudicated by the CIT(A) independently in accordance with law.
In the result, all the appeals filed by the assessee is allowed for statistical purposes.
Order pronounced in the open court on 15/09/2025