Loading judgment…
Facts
The Revenue filed appeals against the order of the Ld. CIT(A) concerning AY 2010-11. The assessee did not appear for the hearing, and the notice was returned unserved. The Revenue's representative contended that the Ld. CIT(A) violated Rule 46A by admitting explanations not offered to the AO.
Held
The Tribunal found merit in the Revenue's contentions. It was held that the Ld. CIT(A) violated Rule 46A by admitting new explanations from the assessee without confronting them with the AO. Consequently, the additions made by the AO were deleted, and the penalty was also deleted by the Ld. CIT(A).
Key Issues
Whether the Ld. CIT(A) violated Rule 46A of the Income Tax Rules by admitting explanations not previously presented to the AO, and whether the matter should be restored to the AO for fresh examination.
Sections Cited
271(1)(c), 46A
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, MUMBAI “A” BENCH : MUMBAI
Before: SHRI B.R. BASKARAN & SHRI ANIKESH BANERJEE
ORDER PER BENCH : Both these appeals of the Revenue are directed against the order passed by the Ld. Commissioner of Income Tax (Appeals)-NFAC, Delhi (in short „Ld.CIT(A)‟) and both relate to AY. 2010-11.
is related to quantum assessmentproceedings and other appeal relates to penalty u/s. 271(1)(c) of the Income Tax Act, 1961 („the Act‟).
None appeared on behalf of the assessee. We also noticed that notice of hearing to the assessee sent by the Registry by Regd. Post has been returned un-served. 3. The Ld.DR submitted that the assessee did not appear before the AO also. The Ld.DR further submitted that the Ld.CIT(A) has violated the provisions of Rule 46A of the Income Tax Rules, 1962 („the Rules‟) by admitting explanations which were never offered before the AO.
The addition related to consideration received by the assessee on a property transaction, which was not offered to tax. Before the Ld.CIT(A), the assessee took a different stand and submitted that the impugned amounts were received on lease of properties and hence, there was no tax incidents thereon. The Ld.CIT(A) did not confront the same with the AO and thus, violated the provisions of Rule 46A. The Ld.CIT(A) accepted the contentions of the assessee and accordingly deleted the additions made by the AO. Since the addition made in the quantum proceedings was deleted, the Ld.CIT(A) deleted the penalty levied u/s.271(1)(c) of the Act. The Ld.DR contended that all the issues should be restored to the file of the AO since the Ld.CIT(A) did not take a remand report from the AO.
We find merit in the above said contentions of the assessee.Since there is violation of Rule 46A, we are of the view that all the issues contested by the Revenue should be restored to the file of the AO for examining them afresh. Accordingly, we set aside the order passed by the Ld.CIT(A) in both these appeals and restore all the issues to the file of the AO for examining them afresh. We also direct the assessee to fully co-operate with the AO for expeditious completion of the restored proceedings.