DCIT Vs Merigold Impex (Chhattisgarh High Court)
The Chhattisgarh High Court dismissed an appeal filed by the Revenue under Section 260-A of the Income Tax Act, 1961, challenging the order of the Income Tax Appellate Tribunal (ITAT), Raipur, dated 27.10.2023. The appeal questioned the deletion of an income tax addition of ₹4,89,85,000 by the Commissioner of Income Tax (Appeals) [CIT(A)], which had been upheld by the ITAT.
The Revenue contended that the CIT(A) had deleted the addition by recording findings that were perverse to the record, alleging violation of Rule 46A of the Income Tax Rules on the ground that additional evidence had been admitted without a formal application and without granting the Assessing Officer (AO) an opportunity to examine such material. It was further argued that the ITAT erred in affirming the CIT(A)’s order by upholding these allegedly perverse findings.
The High Court examined the impugned order of the ITAT and noted that the Tribunal had specifically considered the Revenue’s objections relating to Rule 46A. The ITAT recorded a clear finding that all the information relied upon by the CIT(A) regarding the flow and source of funds had already been submitted by the assessee during the assessment proceedings before the AO. The Tribunal observed that this fact was expressly noted by the CIT(A), who recorded that all key facts were already available on the assessment record.
