ITO WARD- 62(1), NEW DELHI vs. HARVINDER SINGH SAINI, NEW DELHI

PDF · subscribers
ITA 5537/DEL/2019Status: DisposedITAT Delhi04 August 2023AY 2015-163 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal found that the Assessing Officer did not provide the assessee with a proper opportunity of hearing before making additions. The CIT(A) also failed to obtain a remand report or allow the AO to comment on the evidence submitted by the assessee.

What were the facts?

The Assessing Officer made additions for consumable site material, building/construction material, contractual labour, and machinery maintenance expenses. The CIT(A) deleted these additions by admitting additional evidence. The Revenue appealed, arguing the CIT(A) violated Rule 46A by admitting additional evidence without proper procedure.

What were the issues?

Whether the CIT(A) erred in deleting additions by admitting additional evidence in violation of Rule 46A, and whether the assessee was afforded due opportunity of hearing by the Assessing Officer.

Which sections of the Income-tax Act were involved?

Rule 46A

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH: H: NEW DELHI

Before: SHRI CHANDRA MOHAN GARG & DR. B.R.R. KUMAR

Hearing: 19.07.2023Pronounced: 04.08.2023

For Revenue: Shri Amit Katoch, Sr. DR For Assessee : Shri Jugal Gulati, CA Date of Hearing : 19.07.2023 Date of Pronouncement : 04.08.2023 ORDER PER CHANDRA MOHAN GARG, J.M. This appeal has been filed against the order of Ld. CIT(A)-38, New Delhi dated 26.12.2017 for AY 2015-16. 2. The ground has been raised of revenue is as follows:-

1. 1. On the facts and in the circumstances of the case, Ld CIT (A) has erred in law in deleting the addition of Rs 1,35,53,111/-towards consumable site material, Rs. 10,00,000/- towards building / construction material, Rs 8,09,250/- towards contractual labour expenses & Rs 6,71,210/- towards machinery breakdown & maintenance expenses, by admitting additional evidence under rule 46A(1) thus violating rule 46A(3) of the I. T. Rules, 1962.

3. The ld Senior DR contended that On the facts and in the circumstances of the case, Ld CIT (A) has erred in law in deleting the addition of Rs 1,35,53,111/-towards consumable site material, Rs. 10,00,000/- towards building / construction material, Rs 8,09,250/- towards contractual labour expenses & Rs 6,71,210/- towards machinery breakdown & maintenance expenses, by admitting additional evidence under rule 46A(1) thus violating rule 46A(3) of the I. T. Rules, 1962. He further submitted that the Assessing Officer has made four disallowances on account of consumable site material, building construction material, contractual labour expenses and machinery breakdown maintenance expenses by observing correct factual position against the assessee but the ld. CIT(A) granted relief to the assessee without any justified reason and basis therefore the impugned first appellate order may kindly be set aside by restoring that of the Assessing Officer. The ld Senior DR submitted that the ld. CIT(A) has admitted additional evidence in violation of rule 46A of the Rules and granted relief to the assessee after considering the same therefore impugned first appellate order may kindly be set aside by restoring that of the Assessing Officer.

4.

Replying to the above the ld. counsel of the assessee submitted that the Assessing Officer made additions without allowing due opportunity of hearing to the assessee in a history manner which were rightly deleted by the ld. CIT(A) therefore first appellate order may kindly be uphold by restoring that of the Assessing Officer.

5.

On careful consideration of above submissions first of all, from the assessment order we note that the Assessing Officer issued notice u/s. 143(2) of I.T Act 1961 (for short the ‘Act’) on 21.09.2016 and subsequently only one notice u/s. 142(1) along with questionnaire was issued and Shri Harish Gupta, CA attended the proceedings. Thereafter the Assessing Officer proceeded to made four disallowances in the hands of assessee on the issues noted above without any further enquiry or show cause notice to the assessee the Assessing Officer passed scrutiny assessment order on 26.12.2017. This shows that the Assessing Officer had not provided due opportunity of hearing to the assessee before making additions. The ld. CIT(A) in para 3 noted that the assessee appeared with his AR and produced books of accounts along with bills, vouchers for the expenses claim under different heads and he noted that most of the payments have been made through cheque as was shown from the ledger account and bank statement. The ld. CIT(A) noted that despite the assessee produced said books of accounts and other documentary evidence before the Assessing Officer but the same were note taken into consideration by the Assessing Officer while passing assessment order.

6.

The ld. CIT(A) has not called any remand report from the Assessing Officer during first appellate proceedings and deleted all four additions without allowing the Assessing Officer to rebut or comment on the evidence filed by the assessee or without making any enquiry as to whether these books and documentary evidence were in fact produced before the Assessing Officer by the assessee during assessment proceedings. In view of above and as agreed by ld. Representatives of both the sides, we are of the view that the matter needs to be restored to the file of Assessing Officer for afresh framing of assessment after allowing due opportunity of hearing to the assessee and without being influenced from the earlier orders.

7.

In the result, the appeal of the Department is allowed for statistical purposes. Order pronounced in the open court on 04.08.2023.

Recent GST High Court judgments

Search GST case law →