DCIT CEN CIR 1(1), MUMBAI vs. TILAKNAGAR INDUSTRIES LTD, MUMBAI

The present appeal has been preferred by the Revenue against the order dated 02.02.2015 of the Commissioner of Income Tax (Appeals) [hereinafter referred to as the CIT(A)] relevant to assessment year 2007-08.

The short facts of the case are as under:

Matter carried to the Ld. CIT(A) and the Ld. CIT(A) has allowed the claim. Therefore, department is in appeal before us.

During the course of hearing, the Ld. D.R. has raised the objections that the assessee has submitted the paper book wherein the assessee has given the certificate before the Tribunal that the Sl. No.52929 which is filed in paper book No.1 volume B. All the documents were filed before the AO and the Ld. CIT(A). The assessee has also given certificate in paper book No.1 volume ‘C’. The documents at Sl. No.30 to 50 were filed before the AO and the 3 M/s. Tilaknagar Industries Ltd. Ld. CIT(A). Thereafter, assessee has filed the revised index of paper book in part on 26.05.17 and rectified the mistake in giving the certificate and the certificate at Sl. No.32 to 34, 35, 49 and 50 were filed before the AO and the Ld. CIT(A) as per his direction during the appellate proceeding.

The Ld. D.R. objected that he has verified the record and found that this kind of documents were not filed before the Ld. CIT(A). Therefore, Department has taken the ground before the Tribunal that the Ld. CIT(A) has deleted all the additions without verifying distribution expenses being un-reconciled, legal and professional fee without any reason. Moreover, claim of bad debt was allowed. Similarly, TV production was allowed without any proof and whatever the evidence filed before the Ld. CIT(A) was allowed by the Ld. CIT(A) without being verified. The Ld. CIT(A), merely relying upon the statement of the Ld. A.R., has deleted all these additions. Therefore, when all the documents were filed before the Ld. CIT(A), the Ld. CIT(A) should have called for the remand report from AO and if Ld. CIT(A) has not called for the remand report the Ld. CIT(A) should have made enquiry himself to the document filed before the Ld. CIT(A) but merely relying upon the documents he has deleted all these additions which is contrary to the law. Moreover, the Ld. CIT(A) has exceeded his jurisdiction. Therefore, appeal may be allowed.

On the other hand, during the course of hearing, the enquiry was made from the Ld. A.R. whether there was any mistake on the part of the A.R. who was representing before the Ld. CIT(A). The Ld. A.R. submitted that assessee has submitted additional evidence before the Ld. CIT(A) but the assessee has submitted all these additional evidences as per the direction of Ld. CIT(A) and as per rule 46A read with section 254 of the Act, the Ld. CIT(A) on his own direction can ask the assessee to produce the document or evidence. Therefore, the Ld. A.R. relying upon the decision of Mumbai Tribunal in the case of ITO vs. Industrial Roadways 112 ITD 293 Mumbai submitted that there is no requirement in law that Commissioner should consult and confront AO on every additional evidence. The Ld. A.R. also submitted that assessee has received all these payments through government agency only. Therefore, there is no reason to restore this matter back to the file of AO.

We have heard the rival contentions of both the parties. Looking to the facts and circumstances of the case, we find that assessee is engaged in business of manufacturing and selling of industrial alcohol, Indian made foreign liquor, chemicals and sugar cubes. The assessee did not submit any document before the AO but some of the documents were submitted before the Ld. CIT(A) and the Ld. CIT(A) relying upon those documents has deleted the addition. We have also gone through the order of the Ld. CIT(A) and the Ld. CIT(A) nowhere states that he himself has made the enquiry in respect of the expenditure or payment. The Ld. CIT(A)

In the result, Departmental appeal is allowed.