M/S EMKAY INDUSTRIES LTD. vs. CIT JALANDHAR

IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH ITA No. 216 of 2009 Date of decision:2.7.2009 M/s EMKAY Industries Limited, through Shri Rakesh Khanna, M.D. ......Appellant Vs. CIT., Aayakar Bhawan, Central Revenue Building, Jalandhar. ...Respondent CORAM:- HON'BLE MR.JUSTICE ADARSH KUMAR GOEL HON'BLE MRS.JUSTICE DAYA CHAUDHARY PRESENT: Mr.S.K.Mukhi, Advocate, for the appellant. **** ADARSH KUMAR GOEL, J. (Oral) 1. This appeal has been preferred by the assessee under Section 260A of the Income Tax Act, 1961 (for short, “the Act”) against the orders of ITAT Amritsar Bench in I.T.A.No. 428 (ASR) 2008 dated 8.10.2008 for Assessment Year 2004-05, proposing to raise following substantial questions of law: 1. “Whether I.T.A.T. was justified in setting aside the issues to the file of CIT(A) without appreciating the findings of CIT(A) on record in addition to facts and evidences and also being a final fact finding body and that too without giving reasonable opportunity to the appellant by

ITA No. 216 of 2009 -2- denying hearing on the first adjournment application by the counsel that too under unavoidable circumstances?” 2. “Whether the I.T.A.T. was not justified in setting aside the issues to the file of CIT(A) against the established Principles of Law that no one should be allowed to play second innings and that too without going into merits of the case, it being a last fact finding body and thus order of ITAT being perverse needs to be set aside?” 3. “Whether under the facts and circumstances of the present case finding of the ITAT in not considering the present case in its true prospective is perverse and thus bad in law?” 4. “Whether under the facts and circumstances of the case and in view of the specific finding of CIT (A) that the provisions of Sections 68, 69, 69A, 69B, 69C and 69D are not applicable at all to the facts of the present case since the assessee himself has declared the amount of commission received as income, the orders of the ITAT setting aside to the file of CIT(A) for re-examining the additional evidence is perverse and bad in law?”

ITA No. 216 of 2009 -3- 2. The Assessing Officer during the course of assessment made certain additions under Section 68 of the Act holding that the assessee had failed to establish the identity, genuineness and creditworthiness of the transactions. In the course of appellate proceedings, the assessee furnished additional evidence in the form of confirmation letters which were forwarded to the AO. The AO sought time for verification but failed to send his report. The CIT (A) allowed the appeal of the assessee by accepting additional evidence. 3. On appeal by the Revenue to the Tribunal, it was held that CIT (A) should have awaited the opinion of the AO or should have conducted inquiry himself as provided under Section 250(4) of the Act. The Tribunal remitted the matter for fresh decision. The conclusion of the Tribunal is as under: “Hence, in our opinion, it would have been better, if the learned CIT(A) would have directed the AO to examine the parties in accordance with law to establish the identity genuineness and creditworthiness of those parties and thereupon decide the issue since the detailed enquiry is required, was not carried out. Since the work is not properly entrusted to the AO and CIT(A) is doing it all by himself, the learned CIT(A) would have been justified, if he had get the evidence verified by the AO which he failed to do so. Hence in the interest of justice, we set aside the issue to the file of the CIT(A) and direct the AO to send remand report after duly examining the concerned parties.

ITA No. 216 of 2009 -4- Since we have set aside the issue to the file of the learned CIT(A) we refrain from going to the merits of the case.” 4. We have heard learned counsel for the appellant. He submits that the CIT (A) had analysed the additional evidence properly and in such a situation, rem and by the Tribunal is uncalled for. 5. The Tribunal has merely remanded the matter with the finding that the CIT(A) had not fully enquired into the matter. In the impugned order, option has been left to the CIT(A) to either look into the matter himself or to have a verification done from the Assessing Officer. No prejudice is caused to the appellant. View taken by the Tribunal is a possible view. No substantial question of law arises. 6. The appeal is dismissed. (ADARSH KUMAR GOEL) JUDGE (DAYA CHAUDHARY) July 02, 2009

JUDGE raghav Note: Whether this case is to be referred to the Reporter ........Yes/No

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