What did the High Court hold?

The Tribunal remitted the matter to the Assessing Officer for a speaking order after allowing the assessee to present additional evidence. The High Court found no error in the Tribunal's decision to permit additional evidence, considering the substantial question of law involved.

The assessee claimed substantial expenses for a newly set-up business with minimal sales, resulting in a book loss. The assessee argued it was denied a proper opportunity by the Assessing Officer and sought to adduce additional evidence before the Tribunal.

What were the issues?

Whether the Income Tax Appellate Tribunal erred in law by permitting the assessee to adduce additional evidence without sufficient cause, and whether the assessee was denied a proper opportunity by the Assessing Officer.

CIT vs Huber & Suhner Electronics Pvt Ltd | Delhi High Court 2012

IN THE HIGH COURT OF DELHI AT NEW DELHI . . . ITA 313/2012 . . . CIT DELHI-IV ..... Appellant . Through : Sh. Sanjeev Sabharwal, Advocate. . versus . . . HUBER and SUHNER ELECTRONICS PVT LTD ..... Respondent . Through : Nemo. . CORAM: . HON'BLE MR. JUSTICE S. RAVINDRA BHAT . HON'BLE MR. JUSTICE R.V.EASWAR . . . O R D E R . 02.07.2012 . . . The Revenue seeks to appeal against an order of the Income Tax Appellate Tribunal (ITAT) dated 14.09.2011 in ITA No. 4973/Del/2010, for the Assessment Year (AY) 2005-06. . The Appellate Tribunal had remitted the matter for reconsideration by the Assessing Officer with a further direction that he should pass a speaking order in accordance with law, after giving the Assessee a reasonable opportunity of being heard. The brief facts are that the Assessee had claimed that its business was newly set-up on 03.01.2005 and that for the relevant Assessment Year 2005-06, it had just transacted one sale to the extent of Rs. 6790/-. The Assessee had claimed expenses amounting to Rs.84,73,955/- and declared a book loss of Rs. 84,67,165/-. During the course of the Assessee s appeal, reliance was placed on Rule 29 of the Appellate Tribunal Rules, 1963 with a further request that it should be permitted to adduce additional evidence. The Assessee complained that it was not given proper opportunity by the Assessing Officer since the Assessment Order was passed on the date when the matter . was fixed for hearing, at the Show Cause Notice stage. The Assessee further urged that when the appeal which was pending for more than three years came up for hearing, it managed to place its hands upon certain vital documents which had not been placed at the stage of filing the appeal. Learned counsel for the Revenue urges that the Tribunal fell into error of law in . permitting the Assessee to adduce additional evidence on the basis of its application. Learned counsel urged that the applicable test is that the Tribunal should be satisfied that there is a substantial cause which persuades it to permit adoption of such evidence not previously produced. Learned counsel urged that the mere vague assertion by the Assessee that it had place relevant document, is insufficient. We notice that the Assessee had claimed various expenses and had, at the same time, stated that it had relied on one solitary trading activity. In these circumstances, grant of opportunity to adduce evidence can hardly call for interference by the High Court at this stage when a substantial question of law exists. This Court is not persuaded to accept the contentions of Revenue in this regard. The appeal is accordingly dismissed. . . . . . S. RAVINDRA BHAT, J . . . . . . . . . R.V.EASWAR, J . JULY 02, 2012 . ajk . . . . . . . $ 3 .

CIT vs. HUBER & SUHNER ELECTRONICS PVT LTD

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