ITO Vs Aruna Gullapalli (ITAT Hyderabad)
ITAT Hyderabad held that it is mandatory for CIT(A) to grant responsible opportunity to the Assessing Officer in case additional evidence is admitted. However, in the present case, the documents based on which relief is granted was already available with the department and hence there is no violation of Rule 46A of the Income Tax Rules.
Facts- The only effective ground raised by the revenue in the present appeal is that whether on the facts and in the circumstances of the case, the ld.CIT(A) is justified in law in allowing relief towards exemption u/s 54F of the Income Tax Act, 1961 and cost of acquisition u/s 48 of the Income Tax Act, 1961 on the basis of additional evidence without calling for remand report under Rule 46A of the Income Tax Rules, 1962 and conducting enquiry under section 250(4) of the Income Tax Act, 1961.
Conclusion- From the bare perusal of Rules, it is abundantly clear that the ld.CIT(A) in case chooses to admit any additional evidence in that eventuality, she is under mandatory obligation to provide a reasonable opportunity to the Assessing Officer with a view to examine the evidence or document or permit to cross-examine the evidence produced by the assessee. Further, the law contemplates the Assessing Officer to produce any witness or document or evidence in rebuttal to the evidence produced by the assessee in the appellate proceedings.
Held that the rules framed by the Board are handmade tools in the hands of the Department to achieve the ends of justice. In the present case, the documents based on which the indexation was granted to the assessee were available with the Assessing Officer and on the basis of very same document, he had made the addition of Rs.3 crore in the hands of assessee. Further, the details of the investment made by the assessee in purchasing the immovable property were also available with the Department, therefore, saying that the ld.CIT(A) had relied upon the additional evidence would not be correct as the said information / documents were available in the assessment record / folder. In view of the above, we are of the opinion that no additional document / evidence was relied upon by the ld.CIT(A) to grant the relief to the assessee. Hence, there is no violation of Rule 46A of the Act in the light of the above said facts. Hence, the grounds raised by the Revenue for violation of Rule 46A are specifically deleted.
FULL TEXT OF THE ORDER OF ITAT HYDERABAD
The appeal of the Revenue for A.Y. 2017-18 arises from the order of Commissioner of Income Tax, Hyderabad – 10 dated 30.03.2021 invoking proceedings under section 144 of the Income Tax Act, 1961 (in short, “the Act”).
2. Though the Revenue has raised as many as ten grounds but all the grounds are inter-related and the only effective ground out of them reads as under :
“Whether on the facts and in the circumstances of the case, the ld.CIT(A) is justified in law in allowing relief towards exemption u/s 54F of the Income Tax Act, 1961 and cost of acquisition u/s 48 of the Income Tax Act, 1961 on the basis of additional evidence without calling for remand report under Rule 46A of the Income Tax Rules, 1962 and conducting enquiry under section 250(4) of the Income Tax Act, 1961.”
2.1 The appeal filed by the Revenue is barred by limitation by 74 days. The appellant / Revenue has moved a condonation petition explaining reasons thereof. We have heard both the parties on this preliminary issue. In this connection, the appellant has filed an affidavit for condonation of the said delay wherein, it was, inter-alia, affirmed that Covid-19 Pandemic situation made adverse effect on them in obtaining copies and arranging logistics for filing the appeal within the stipulated time of 60 days i.e., by 05.06.2021 and relied on the orders of Hon’ble Supreme Court vide order dt.27.04.2021 wherein it was held “we therefore, restore the order dt.23.03.2020 and in continuation of the order dt.08.03.2021 direct that the period(s) of limitation, as prescribed under any general or special laws in respect of all judicial or quasi judicial proceedings, whether condonable or not, shall stand extended till further orders.”. In view of the above, we hold that any delay; supported by cogent reasons, deserves to be condoned so as to make way for the cause of substantial justice. We accordingly hold that appellant/ Revenue’s impugned delay in filing this appeal is neither intentional nor deliberate but due to the circumstances beyond their control. Hence, the same stands condoned. Case is now taken up for adjudication on merits.
3. The brief facts of the case are that assessee who is an individual filed her return of income for A.Y. 2017-18 admitting a total income of Rs.4,28,400/- and subsequently, the case was selected for limited scrutiny under CASS. As there was no response from the assessee for the notices sent by the Assessing Officer, he issued show cause notice regarding proposed completion of assessment ex-parte u/s 144. As there was no reply from the assessee even to the said show cause notice, Assessing Officer completed the assessment ex-parte interalia by making addition of Rs.3,00,00,000/- as long term capital gain disallowing cost of acquisition as well as deduction towards 54F and Rs.1,85,00,000/- towards unexplained investment u/s 69 of the Act and thus assessed the total income at Rs.4,89,28,400/-.
4. Feeling aggrieved with the order of Assessing Officer, assessee carried the matter before ld.CIT(A) who passed order in favour of the assessee by holding as under :
“8. The details furnished by the appellant are taken on record. The documentary evidence submitted by the appellant are actually “Public documents” in as much as they are sale of one property and purchase of another property where the transactions have taken place through a visible trial i.e, through bank. In-fact the sale of property and reinvestment in the property are visible transactions as per the assessment order itself. The assessment order speaks of non-cooperation and noncompliance from the appellant and hence additions were made on the following counts:
