DY. COMMISSIONER OF INCOME-TAX(EXEMPTIONS CIRCLE), AURANGABAD., AURANGABAD vs. NAMCO CHARITABLE TRUST, NASHIK

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH “A”, PUNE BEFORE SHRI MANISH BORAD, ACCOUNTANT MEMBER AND SHRI VINAY BHAMORE, JUDICIAL MEMBER आयकर अपील सं. / ITA No.2559/PUN/2025 िनधा�रण वष� / Assessment Year : 2022-23 DCIT (Exemption Circle), Vs. Namco Charitable Trust, Aurangabad. Plot No.30, Namco Charitable Trust, Peth Road, Near Market Yard, Panchavati, Nashik- 422003. PAN : AAATN2748N Appellant Respondent Revenue by : Shri Amol Khairnar Assessee by : Shri V. L. Jain Date of hearing : 17.02.2026 Date of pronouncement : 27.04.2026 आदेश / ORDER PER VINAY BHAMORE, JM: This appeal filed by the Revenue is directed against the order dated 19.08.2025 passed by Ld. CIT(A)/NFAC for the assessment year 2022-23. 2. The Revenue has raised the following grounds of appeal :- “1. On the facts and circumstances of the case and in law, the Ld. CIT(A) has failed to follow the provisions of Rule 46A of the I.T. Rules, 1962 wherein it is laid down that the CIT/DC (Appeals)

2 ITA No.2559/PUN/2025 shall not take into account any evidence produced under sub- rule (1) unless the A.O. has been allowed a reasonable opportunity to examine the evidence or document or to cross- examine the witness produced by the appellant or to produce any evidence or document or any witness in rebuttal of the additional evidence produced by the appellant. 2. The appellant craves leave to add, alter, amend or omit any or all the grounds of appeal.” 3. Facts of the case, in brief, are that the assessee is a trust duly registered u/s 12AB of the IT Act and has filed its return of income for the year under consideration on 20.10.2022 declaring an income of Rs.Nil. The case was selected for scrutiny assessment under CASS for following reason :- “i. Form 10B not filed or filed after due date of filing of return. ii. Large amount of Borrowed funds by Trust. iii. Repayment of large amount of Borrowed funds by Trust. iv. High refund claimed by Trust.” 4. Accordingly, notices u/s 143(2) & 142(1) and show cause notices respectively were issued to the assessee. After considering the reply and submissions of the assessee, the Assessing Officer completed the assessment proceedings u/s 143(3) r.w.s. 144B of the IT Act and vide order dated 27.03.2024 passed the assessment order by determining income at Rs.18,53,44,573/- as against the income of Rs.Nil returned by the assessee. The above assessed income

3 ITA No.2559/PUN/2025 includes addition of Rs.18,53,44,573/- on account of disallowance made on repayment of borrowed fund since there was no proof and source for repayment of loan was explained by the assessee and as per the reply of the assessee no repayment of borrowed fund was made. 5. Being aggrieved with the above assessment order, the assessee preferred an appeal before Ld. CIT(A)/NFAC. After considering the reply and submissions of the assessee, Ld. CIT(A)/NFAC allowed the appeal filed by the assessee. 6. It is the above order against which the Revenue is in appeal before this Tribunal. 7. We have heard Ld. Counsels from both the sides and perused the material available on record including the paper book furnished by the assessee and copy of case laws furnished by Ld. DR. In this regard, we find that Ld. CIT(A)/NFAC by relying on letter dated 24.04.2024 and certificate issued by banks accepted the contention of the assessee that there was no repayment of any loan during the year under consideration. We find that the assessment order was passed on 27.03.2024, therefore admittedly the above letter dated 24.04.2024 and certificate issued by banks, becomes additional

4 ITA No.2559/PUN/2025 evidences which needs to be verified by the Assessing Officer as well. However, we find that Ld. CIT(A)/NFAC has not forwarded these additional evidences to the Assessing Officer for his remarks/comments. This is a clear cut violation of Rule 46A of the IT Rules, 1962 which make it mandatory for Ld. CIT(A)/NFAC to follow the provisions of Rule 46A of the IT Rule, 1962 prior to accepting any additional evidence which was not produced before the Assessing Officer during the course of original assessment proceedings. 8. In this regard, Ld. DR placed heavy reliance on the judgement of Hon’ble Kerala High Court in the case of CIT vs. E.D. Benny [2015] 62 taxmann.com 302 (Kerala) and submitted that as per Rule 46A of the IT Rules, 1962, each and every additional evidence should be sent to the Assessing Officer for his comment and since in the instant Ld. CIT(A)/NFAC has not followed procedure under Rule 46A of the IT Rules, 1962, the order passed by Ld. CIT(A)/NFAC is not justified and accordingly prayed to quash the order passed by Ld. CIT(A)/NFAC.

5 ITA No.2559/PUN/2025 9. Ld. AR appearing from the side of the assessee supported the order passed by Ld. CIT(A)/NFAC and requested to confirm the same. 10. With regard to judgement in the case of CIT vs. E.D. Benny (supra) relied on by Ld. DR, we find that Hon’ble Court allowed the appeal filed by the Revenue and held as under :- “Reading of the finding of the Tribunal would suggest that according to it, if additional documents are summoned by the Commissioner (Appeals) and produced or if the additional evidence produced by the assessee are in the nature of clinching evidence leaving no further room for any doubt or controversy, it is not necessary to give an opportunity to the Assessing Officer to contradict the same. In other words, the finding of the Tribunal would suggest that in cases where documents are summoned by the Commissioner (Appeals) and in cases where the documents produced are conclusive, the principles of natural justice are excluded. These findings of the Tribunal could not be enclosed. As held by Delhi High Court in CIT v. United Towers (I.) (P.) Ltd. [2008] 296 ITR 106/172 Taxman 267, rule 46A(4) of the Rules does not specifically exclude the principles of natural justice and, therefore, these principles are to be read into the Rules. Therefore, the finding of the Tribunal set aside. [Para 23]” 11. Respectfully following the above judgement passed in the case of CIT vs. E.D. Benny (supra), we find force in the above arguments of Ld. DR that Rule 46A has to be followed. Accordingly, we deem it appropriate to set-aside the order passed by Ld. CIT(A)/NFAC and restore the matter back to the file of Ld. CIT(A)/NFAC with a direction to decide the appeal afresh and as

6 ITA No.2559/PUN/2025 per fact & law after calling comments of the Assessing Officer with regard to the additional evidences filed by the assessee. Needless to say that Ld. CIT(A)/NFAC shall decide the appeal after providing reasonable opportunity of hearing to the assessee. Thus, the ground of appeal raised by the Revenue is allowed for statistical purposes. 12. In the result, the appeal filed by the Revenue is allowed for statistical purposes. Order pronounced on this 27th day of April, 2026. Sd/- Sd/- (MANISH BORAD) (VINAY BHAMORE) ACCOUNTANT MEMBER JUDICIAL MEMBER पुणे / Pune; �दनांक / Dated : 27th April, 2026. Sujeet/DOC Sujeet Kumar Digitally signed by Sujeet Kumar Sharma Sharma Date: 2026.04.28 11:54:56 +05'30' आदेश क� �ितिलिप अ�ेिषत / Copy of the Order forwarded to : अपीलाथ� / The Appellant. 1. ��यथ� / The Respondent. 2. 3. The Pr.CIT concerned. िवभागीय �ितिनिध, आयकर अपीलीय अिधकरण, “A” ब�च, 4. पुणे / DR, ITAT, “A” Bench, Pune. गाड� फ़ाइल / Guard File. 5. आदेशानुसार / BY ORDER, // True Copy // Assistant Registrar आयकर अपीलीय अिधकरण, पुणे / ITAT, Pune.