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Facts
The Revenue appealed against the order of the CIT(A) concerning the utilization of building fund contributions and UGC grant by the assessee, a society in the educational sector. The assessee had not furnished all necessary evidence during assessment but submitted them before the appellate authority.
Held
The Tribunal found merit in the Revenue's argument that Rule 46A was violated as the CIT(A) admitted evidence not available to the AO, impacting the Revenue's rights. The Tribunal set aside the lower authorities' orders.
Key Issues
Whether the CIT(A) erred in admitting evidence not produced before the AO during assessment proceedings, thus violating Rule 46A of the Income Tax Act.
Sections Cited
68, 46A
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Income Tax Appellate Tribunal, ‘A’ BENCH: CHENNAI
Before: SHRI ABY T VARKEY & SHRI AMITABH SHUKLA
Assessment Years: 2016-17 आयकर अपील सं./ITA No. 2968/Chny/2024, Assessment Years: 2019-20 The Income Tax Officer, The Sree Ayyappa Educational Exemptions Ward, Society, Tirunelveli Sree Ayyappa College for Women, Tamil Nadu-627011. Chunkankadai, Kanyakumari, Tamil Nadu-629003. [PAN: AACTT0234D] (अपीलार्थी/Appellant) (प्रत्यर्थी/Respondent) अपीलार्थी की ओर से/ Assessee by : Mr. Abhishek Murali, CA प्रत्यर्थी की ओर से /Revenue by : Dr. I.Roopa, Addl. CIT सुनवाई की तारीख/Date of Hearing : 26.02.2025 घोषणा की तारीख /Date of Pronouncement : 04.04.2025 आदेश / O R D E R PER AMITABH SHUKLA, A.M :
The below mentioned appeals have been filed by the appellant Revenue for AY-2016-17 and 2019-20 contesting the order of Ld. First Appellate Authority indicated Column-E, herein below:- S. CIT(A) Order Appeal Nos. AYs Appellant Respondent No. Details A B C D E F DIN & Order The Sree Ayyappa No.ITBA / NFAC / Educational Society, The Income 1 S / 250 / 2024-25 / ITA-2967/Chny/2024 2016-17 Sree Ayyappa College Tax Officer, 1069773793(1) for Women, Exemption dated 18.10.2024 Chunkankadai, ward, DIN & Order Kanyakumari, No.ITBA / NFAC / Tirunelveli. Tamil Nadu-629003. 2 S / 250 / 2024-25 / ITA-2968/Chny/2024 2019-20 [PAN: AACTT0234D] 1069774827(1) dated 18.10.2024 Page - 1 - of 4 2.0 As the two appeals are centering around a common issue and hence for the purposes of convenience were heard together and are being adjudicated by this common order together. For the purposes of this adjudication the facts and figures for AY-2016-17 have been taken. As facts have been reported to be identical in AY-2016-17 and 2019-20, the decision for AY-2016-17 shall apply mutatis mutandis for appeal of AY-2019-20. for AY-2016-17, appellant Revenue has contested that the assessee had not furnished any evidences during the course of assessment proceedings but filed the same before the appellate authority. It was contended that the issue in dispute was utilization of building fund contributions and UGC grant by the assessee which is a society in educational sector. It is the case of the Revenue that the Ld.CIT(A), as evident from page 13 to 19 of his order, admitted evidences which were not available to the Ld.AO. The Ld.DR has argued that the Ld.CIT(A) has violated clear provisions of Rule 46A of providing an opportunity of being heard to the Ld.AO before giving any relief to the assessee. The Ld. AR placed reliance upon the order of Ld.CIT(A).
Page - 2 - of 4 4.0 We have heard rival submissions in the light of material available on records. The order of Ld.AO shows that the assessee could not provide any satisfactory evidence to the extent of Rs. 2,75,57,842/- and hence he proceeded to add the same u/s 68 of the Act. It was noted that the assessee had obtained unsecured loans of Rs. 2,76,35,842/-, out of which it could provide documentary evidence to the Ld.AO of only Rs.78,000/-. For the balance, it was simply submitted that the same pertained to UGC grant and building fund. The latter received from the students and guardians as voluntary contributions. The assessee however did not provide any specific details. From the perusal of order of Ld.First Appellate Authority, we have noted that the relief was accorded by relying upon the evidences filed during appellate proceedings. Consequently, we find sufficient force in the argument of the Revenue that its rights under Rule 46A have been adversely impacted. Accordingly, we set aside the order of lower authorities and remit the issue back to the Ld.AO for limited verification of the evidences produced by the assessee before the Ld.First Appellate Authority. He will decide the matter in accordance with law by affording due opportunity of being heard and passing a speaking order. The grounds of appeal raised by the Revenue are allowed for statistical purposes.