What did the Tribunal hold?

The Tribunal found that in the interest of justice, the CIT(A) should have admitted the additional evidence. Therefore, the order of the CIT(A) was set aside and the matter was restored to the CIT(A)'s file for a fresh decision.

The assessee's appeal was against the CIT(A)'s order for AY 2014-15. The assessee argued that the CIT(A) erred in not admitting additional evidence and that the assessment order was passed without a reasonable opportunity of being heard.

What were the issues?

Whether the CIT(A) erred in not admitting additional evidence and whether the assessee was provided with a reasonable opportunity of being heard.

Sri Hanumaiah Srinivas vs ITO | ITAT Bangalore 2018

Income Tax Appellate Tribunal, “SMC-C” BENCH : BANGALORE

Before: SHRI ARUN KUMAR GARODIA

For Appellant: Shri Lokesh Jain, CA

For Respondent: Shri L.V. Bhaskar Reddy, Addl. CIT (DR)

Hearing: 20.03.2018Pronounced: 20.03.2018

O R D E R

Per Shri A.K. Garodia, Accountant Member

This appeal is filed by the assessee which is directed against the order of ld. CIT(A)-7, Bangalore dated 08.12.2017 for Assessment Year 2014-15.

The grounds raised

by the assessee are as under. “1. The order of the Ld. Commissioner of Income Tax (Appeals)("CIT(A)") is opposed to law, facts and circumstances of the case.

2. The order is passed in haste, without providing sufficient and reasonable opportunity of being heard.

3. The order is passed against the principle of natural justice and thus liable to be quashed.

4. The Ld. CIT(A) erred in not considering the evidence produced by the Appellant during the appellate proceedings, although the Appellant has furnished sufficient reason for not furnishing before lower authorities.

5. The Ld. CIT(A) has failed to note that the Ld. Assesing officer ("Ld. AO") has not recorded his findings or observations in its remand report on examining the additional evidence produced by the appellant.

6. The Ld. CIT(A) has erred in confirming the addition of Ld. AO of Rs. 10,87,800/-, being cash deposited by the Appellant in M/s. Sri.

Sudha Co-operative bank Ltd. which was out of his withdrawals from bank accounts held and out of his income earned from milk business which has been offered as business income. The Appellant seeks your leave to add, alter, amend or delete any of the grounds urged at the time of hearing.”

At the very outset, it was submitted by ld. AR of assessee that assessment order passed by the AO is best judgment assessment order passed by the AO u/s. 144 and before CIT (A) the assessee requested for admission of additional evidence which is not admitted by CIT (A). He submitted that in the interest of justice, the CIT(A) should have admitted the additional evidence and then he should have decided the issue on merit. The ld. DR of revenue supported the order of CIT (A) and submitted that as per Rule 46A of IT Rules, admission of additional evidence is not proper.

I have considered the rival submissions and I feel that in the interest of justice, the CIT (A) should have admitted the additional evidence. Hence I set aside the order of CIT (A) and restore the matter back to his file for fresh decision after admitting the additional evidence and after providing adequate opportunity of being heard to both sides.

In view of this decision, no adjudication is called for regarding the merit of the case at this stage and hence, I do not make any comment on the merit of the case.

In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced in the open court on the date mentioned on the caption page.

SRI HANUMAIAH SRINIVAS,BANGALORE vs. THE INCOME TAX OFFICER WARD-6(2)(4), BANGALORE

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