The ITO, , Ward-8(4),, Ahmedabad v. M/s. Umesh Cotton Ginning & Spinning Pvt.Ltd.,, Ahmedabad

ITA 1596/AHD/2010 | 2005-2006
Pronouncement Date: 19-08-2010 | Result: Allowed

Appeal Details

RSA Number 159620514 RSA 2010
Assessee PAN AAACU7227J
Bench Ahmedabad
Appeal Number ITA 1596/AHD/2010
Duration Of Justice 3 month(s) 6 day(s)
Appellant The ITO, , Ward-8(4),, Ahmedabad
Respondent M/s. Umesh Cotton Ginning & Spinning Pvt.Ltd.,, Ahmedabad
Appeal Type Income Tax Appeal
Pronouncement Date 19-08-2010
Appeal Filed By Department
Order Result Allowed
Bench Allotted C
Tribunal Order Date 19-08-2010
Date Of Final Hearing 30-07-2010
Next Hearing Date 30-07-2010
Assessment Year 2005-2006
Appeal Filed On 13-05-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH 'C' BEFORE SHRI BHAVNESH SAINI JM & SHRI A N PAHUJA AM ITA NO.1596/AHD/2010 (ASSESSMENT YEAR:-2005-06) INCOME-TAX OFFICER WARD- 8(4) 4 TH FLOOR AJANTA COMMERCIAL CENTRE A WING ASHRAM ROAD AHMEDABAD V/S M/S UMESH COTTON GINNING AND SPINNING PVT. LTD. 702 ROSEWOOD ESTATE NEAR PRERNATIRTH JAIN TEMPLE NEAR JODHPUR CROSS ROAD SATELLITE AHMEDABAD-15 [PAN: AAACU 7227 J] [APPELLANT] [RESPONDENT] REVENUE BY :- SHRI K M MAHESH DR ASSESSEE BY:- SHRI M J SHAH AR O R D E R A N PAHUJA: THIS APPEAL BY THE REVENUE AGAINST AN ORDER DATED 04- 02-2010 OF THE LD. CIT(APPEALS)-XIV AHMEDABAD RA ISES THE FOLLOWING GROUNDS:- 1 THE LD. COMMISSIONER OF INCOME-TAX(A)-XIV AHMED ABAD HAS ERRED IN LAW AND ON FACTS IN DELETING THE PENALTY OF RS.9 00 000/- LEVIED U/S 271D. 2 THE LD. COMMISSIONER OF INCOME-TAX(A)-XIV AHMEDA BAD HAS ERRED IN LAW AND ON FACTS IN ADMITTING FRESH EVIDENCES IN VI OLATION OF RULE 46A AND NOT ALLOWING THE AO AN OPPORTUNITY TO VERIFY AN D COMMENT UPON THE FRESH EVIDENCES FURNISHED BY THE ASSESSEE. 3 ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A)-XIV AHMEDABAD OUGHT TO HAVE UPHELD THE ORDER OF THE AO. 4 IT IS THEREFORE PRAYED THAT THE ORDER OF THE LD. CIT(A)-XIV AHMEDABAD MAY BE SET ASIDE AND THAT OF THE AO BE RESTORED. 2 UNDISPUTED FACTS IN BRIEF AS PER RELEVANT ORDER S ARE THAT ASSESSMENT IN THIS CASE WAS COMPLETED U/S 143(3) O F THE INCOME- TAX ACT 1961[HEREINAFTER REFERRED TO AS THE ACT] ON 07/12/2007 DETERMINING INCOME OF RS.88 980/- AS AGAINST LOSS OF RS.11 020/- DECLARED IN THE RETURN FILED ON 31.10.2005. DURING THE COURSE OF ITA NO.1596/AHD/2010 . 2 ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER[AO IN SHORT] ON PERUSAL OF THE ANNEXURE RELATING TO THE PARTICULARS OF LOANS OR DEPOSITS TAKEN OR ACCEPTED EXCEEDING RS.20 000/- E ACH IN VIOLATION OF PROVISIONS OF SEC.269SS OF THE ACT FOUND THAT OUT OF THE TOTAL LOANS/DEPOSITS OF RS.43 13 225/- ACCEPTED BY THE AS SESSEE DURING THE PREVIOUS YEAR THE ASSESSEE ACCEPTED LOAN OF RS .4 50 000/- FROM SHRI BABUBHAI I. THAKKAR OTHERWISE THAN BY ACCOUNT PAYEE CHEQUE OR ACCOUNT PAYEE DRAFT IN VIOLATION OF PROVISIONS OF SEC.269SS OF THE ACT. THE AO ALSO NOTICED THAT THE ASSESSEE ACCEPT ED RS.2 00 000/- FROM CHANDRAKANT ISHWARLAL AND RS.2 50 000/- FROM K ISHORKUMAR D. THAKKAR AND AGAINST SUCH AMOUNTS THE AUDITOR IN TH E ANNEXURE HAD REMARKED- 'HAWALA OF SHARE APPLICATION MONEY'. DESP ITE SUFFICIENT OPPORTUNITY ALLOWED THE ASSESSEE DID NOT FURNISH A NY EXPLANATION FOR ACCEPTING THE SAID LOANS/DEPOSITS OTHERWISE THA N BY ACCOUNT PAYEE CHEQUE OR ACCOUNT PAYEE DRAFT. ACCORDINGLY T HE AO ISSUED A SHOW CAUSE NOTICE ON 18/03/2008 FOR THE DEFAULT IN TERMS OF PROVISIONS OF SEC.269SS OF THE ACT. SINCE THERE WAS NO COMPLIANCE ON THE PART OF THE ASSESSEE THE AO ONCE AGAIN ISS UED NOTICE ON 28- 04-2008 REQUIRING THE-ASSESSEE TO SHOW CAUSE AS TO WHY PENALTY U/S.271D OF THE ACT FOR VIOLATION OF PROVISIONS OF SEC.269SS OF THE ACT BE NOT IMPOSED. THERE WAS NO COMPLIANCE ON THE PART OF THE ASSESSEE EVEN TO THIS NOTICE. ANOTHER NOTICE DATED 12/09/2008 ALSO WENT UNRESPONDED. .ACCORDINGLY THE AO IMPOSED A PE NALTY OF RS.9 00 000/- U/S.271D OF THE ACT. 3. ON APPEAL THE LD. CIT(A) WHILE ADMITTING THE A DDITIONAL EVIDENCE IN CONTRAVENTION OF RULE 46A OF THE IT RUL ES 1962 CANCELLED THE PENALTY IN THE FOLLOWING TERMS: 2.2 DURING THE COURSE OF APPELLATE PROCEEDINGS TH E A.R. OF THE APPELLANT VIDE ITS LETTER DATED 25-08-09 HAS SUBMI TTED THAT THE ORDER IMPOSING PENALTY U/S. 271D OF THE ACT WAS NEVER REC EIVED BY THE ASSESSEE AND IT IS ONLY THE ASSESSEE WAS CONTACTED TELEPHONI CALLY ABOUT THE ARREAR DEMAND OF RS.9 LAKHS THAT THE ASSESSEE CAME TO KNOW ABOUT SUCH AN ITA NO.1596/AHD/2010 . 3 ORDER BEING PASSED. THEREAFTER A CERTIFIED COPY OF THE ORDER WAS DELIVERED ON 13-08-09 AND IMMEDIATELY IT HAD FILED THE APPEAL AND HENCE IT WAS REQUESTED THAT THIS APPEAL MAY BE CONSIDERED AS FIL ED WITHIN LIMITATION OF 30 DAYS FROM THE DATE OF RECEIPT OF ORDER. ACCORDIN GLY A LETTER DATED 25-11- 09 WAS ISSUED TO THE A.O. ASKING HIM TO SEND-THE CA SE RECORDS ALONG THE PROOF OF SERVICE OF ORDER U/S. 271D OF THE ACT. THE APPELLANT'S REPRESENTATIVE ATTENDED THE PROCEEDINGS ON 2-12-0 9 AND SUBMITTED A PAPER BOOK AND COPY OF CASE LAW IN THE CASE OF CIT VS. BOMBAY CONDUCTORS & ELECTRICALS LTD. (GUJ) 301 ITR 0328. IT WAS FURTHER CLARIFIED THAT THE ISSUE OF NON RECEIPT OF ORDER U/S. 271D WA S EXPLAINED BY APPELLANT'S LETTER DATED 11-08-09 AND NO FORMAL INT IMATION REGARDING CHANGE OF ADDRESS WAS GIVEN TO THE AO. THE APPELLAN T FURTHER SUBMITTED THE FACTS IN RESPECT OF DEPOSITS OF CHANDRAKANT I. THAKKAR KISHOKUMAR D. THAKKAR AND BABUBHAI I. THAKKAR ALONG WITH EVIDENCE S IN THE FORM OF ACCOUNTS ALONG WITH THE STATEMENT OF BANK ACCOUNT O F SUVIKASH PEOPLES CO-OP. BANK LTD. FOR THE PERIOD FROM 01-12-04 TO 2 8-05-05. IN THE CASE OF CHANDRAKANT I THAKKAR IT WAS EXPLAINED THAT ON 27- 1-05 FOUR DIRECTORS ALONG WITH HIM WERE GIVEN CREDIT OF RS.8 LAKHS FOR THE PURCHASE OF LAND ON THE SAME DAY THIS ACCOUNT WAS TRANSFERRED TO SHARE APPLICATION MONEY AND ON 3-2-05 SHARE APPLICATION MONEY OF RS.2 LAKHS WA S TRANSFERRED TO DEPOSIT ACCOUNT OF CHANDRAKAHAT I. THAKKAR. IN RESP ECT OF KISHORKUMAR D. THAKAR FOLLOWING AMOUNTS WERE ACCEPTED ON DIFFEREN T DATES AS UNDER:- 22/11/04-CASH RS. 50000 SHARE APPLICATION MONEY 22/01/05-HNSB-973880 RS. 170000 27-01-05-HNSB-904116 RS. 100000 : 28-01-05-HNSB-904117 RS. 30000 --------------- RS. 350000 OUT OF ABOVE RECEIPT EQUITY SHARE OF RS.1 LAC WAS ALLOTTED AND REMAINING AMOUNT OF RS.2 50 000/- WAS TRANSFERRED TO THE PERS ONAL ACCOUNT THROUGH J.V. AS A DEPOSIT TO THE COMPANY. IN THE CASE OF BA BUBHAI I. THAKKAR AN AMOUNT OF RS.4 50 000/- WAS ACCEPTED IN CASH ON 8-2 -05 AND CASH WAS REQUIRED TO DEPOSIT OF RS.4 55 000/- IN SUVIKASH CO .OP. BANK SO THAT FOLLOWING CHEQUES WHICH WERE ISSUED FOR PLACING ORD ER FOR VARIOUS PLANT & MACHINERY AS MENTIONED BELOW DO NOT BOUNCE AS THE B ANK BALANCE ON 7-2- 05 WAS ONLY RS.14 138/-: 8-2-05 CH. 416594 12 500 BHUMI ENG. PLAN T & MACHINERY CH. 416595 150 000 KARUNANAND HYDO CH. 416596 299 390 KARUNA CORPO. 2.3 I HAVE CONSIDERED THE FACTS OF THE CASE AND THE SUBMISSIONS OF THE APPELLANT. THE FIRST OBJECTION OF THE APPELLANT ABO UT NO PROPER OPPORTUNITY GIVEN AND NON SERVING OF ORDER U/S. 271D OF THE ACT WAS NOT PRESSED BY THE ITA NO.1596/AHD/2010 . 4 APPELLANT IN VIEW OF APPELLANT'S LETTER DATED 11-08 -2009 BY WHICH IT WAS ACCEPTED BY APPELLANT THAT IT HAD SHIFTED ITS OFFIC E FROM EARLIER ONE WITHOUT INTIMATION TO DEPARTMENT AND THEREFORE THERE WAS NO N COMPLIANCE. NOW COMING TO THE MERIT OF THE CASE THE EXPLANATION GI VEN BY THE APPELLANT IS FOR THE FIRST TIME BEFORE ME BUT CONSIDERING THE FA CT THAT THE SAME IS SELF EXPLANATORY THE SAME IS VERIFIED AND CONSIDERED. T HESE ARE DETAILS WHICH ARE OTHERWISE AVAILABLE WITH APPELLANT'S RETURN OF INCOME IN ONE OR OTHER FORM. HON'BLE DELHI HIGH COURT IN THE CASE OF CIT VS. DEV MUSCO LIGHTING PVT. LTD. (2009) 316 ITR 209 HELD THAT 'CIT(A) HIMS ELF IS A SENIOR OFFICER AND PART OF TAX ADMINISTRATION AND COULD ACCEPTED S UCH DETAILS.' IT IS ALSO SETTLED PROPOSITION THAT THE CIT(A) HAS POWER WITH COTERMINOUS THAT OF AO. ALL THESE DETAILS AS SUBMITTED BY APPELLANT NOW WAS NOT SUBMITTED SINCE DUE TO CHANGE OF ADDRESS SUCH OPPORTUNITY WAS NOT R EACHED TO APPELLANT AND THEREFORE APPELLANT WAS PREVENTED BY SUFFICIENT CAUSE FOR NOT SUBMITTING SUCH DETAILS. OTHERWISE ALSO SUCH DETAIL S HAS CRUCIAL IMPLICATION FOR THE ISSUE UNDER CONSIDERATION. AS HELD BY HON'B LE GUJARAT HIGH COURT IN THE CASE OF CIT VS. BHAGWATI PRASAD BAROJORIA HUF 263 ITR 487 THE BASIC OBJECTIVE FOR PROMULGATING SECTION 269 SS AND 269T WITH CONSEQUENTIAL PENALTY U/S. 271D AND 271E OF THE ACT WAS TO CURB A N UNETHICAL PRACTICE OF EXPLAINING UNACCOUNT CASH FOUND DURING THE COURSE O F SEARCH. IN THE BONAFIDE CASES WHERE IDENTITY CREDITWORTHINESS AND GENUINITY OF TRANSACTION ARE NOT IN DOUBT SUCH CASES ARE TREATE D AS HAVING REASONABLE CASES U/S. 273B AS HELD BY HON'BLE SUPREME COURT IN THE CASE OF ASSTT. DIRECTOR OF INSPECTION (INV.) VS. KUM. A. B.SHANTHI (2002) 255 ITR 258 WHERE HON'BLE APEX COURT GIVEN THE TEST TO DETERMIN E SUCH REASONABLE CAUSE. IN THE CASE OF APPELLANT ALL THE THREE PARTI ES ARE IDENTIFIABLE AND IN FACT DIRECTOR OR SHARE HOLDER OF THE APPELLANT COMP ANY. IN TWO CASES OF SHRI CHANDRAKANT I. THAKKAR AND SHRI KISHORE KUMAR D. TH AKKAR THE INITIAL CASH RECEIVED WAS FOR SHARE APPLICATION MONEY WHICH WERE LATER ON ALLOTTED TO THEM AND THEREFORE THOSE MONEY WAS NOT ACCEPTED AS LOAN OR ADVANCE AS STIPULATED U/S. 269SS OF THE ACT. IN THE CASE OF SHRI BABUBHAI I. THAKKAR THE APPELLANT REASON TO RECEIVE THE CAS H IS SATISFACTORY FROM THE VERIFICATION OF FACTS OF THE CASE. THE APPELLANT WA S HAVING SUFFICIENT REASON AS EXPLAINED. HON'BLE ITAT AHMEDABAD 'D' BENCH IN THE CASE OF JITU BUILDER (P) LTD VS. ADDL. CIT (2009) 125 TTJ (AND) (TM) 721 HELD THAT IN SUCH CASES THERE IS NO CONTRAVENTION OF SECTION 269SS OF THE ACT. IT IS THEREFORE APPELLANT HAS PROPERLY DISCHA RGED ITS ONUS OF EXPLAINING SATISFACTORILY ABOUT SUCH TRANSACTION. THE PENALTY SO IMPOSED THEREFORE NOT TENABLE IN THE EYE OF LAW. THE AO IS DIRECTED TO DE LETE THE PENALTY. 4. THE REVENUE IS NOW IN APPEAL BEFORE US AGAINST THE AFORESAID FINDINGS OF THE LD. CIT(A). THE LD. DR WH ILE INVITING OUR ATTENTION TO GROUNDS OF APPEAL RAISED BEFORE US CON TENDED THAT DESPITE SUFFICIENT OPPORTUNITY ALLOWED THE ASSESSE E DID NOT FURNISH ANY EXPLANATION/INFORMATION BEFORE THE AO. THE DOCU MENTS PLACED AT ITA NO.1596/AHD/2010 . 5 SL. NOS. 3 4 6 9 & 11 TO 15 IN THE PAPER BOOK WERE ADMITTEDLY FILED ONLY BEFORE THE LD. CIT(A). THE LD. CIT(A) WITHOUT FOLLOWING THE PROCEDURE LAID DOWN IN RULE 46A OF THE IT RULES 196 2 ADMITTED THE ADDITIONAL EVIDENCE AND CANCELLED THE PENALTY. IT WAS ARGUED THAT THE LD. CIT(A) WAS NOT JUSTIFIED IN ADMITTING FRESH EVIDENCE WITHOUT ALLOWING ANY OPPORTUNITY TO THE AO. ON THE OTHER H AND THE LD. AR ON BEHALF OF THE ASSESSEE DID NOT OPPOSE THESE SUBMISS IONS OF THE LD. DR. AFTER DISCUSSION BOTH THE PARTIES AGREED THAT MATTER NEEDS TO BE RESTORED TO THE FILE OF THE LD. CIT(A) FOR FRESH ADJUDICATION IN ACCORDANCE WITH LAW. 5.. WE HAVE HEARD BOTH THE PARTIES AND GONE THROUGH THE FACTS OF THE CASE. UNDISPUTEDLY THE LD. CIT(A) CANCELLED THE PENALTY LEVIED U/S 271D OF THE ACT WITHOUT ALLOWING ANY OPPORTUNITY TO THE AO EVEN WHE N THE DOCUMENTS PLACED AT SL. NOS. 3 4 6 9 & 11 TO 15 IN THE PAPER BOOK WE RE FILED ONLY FOR THE FIRST TIME BEFORE THE LD. CIT(A). THE LD. CIT (A) WAS WELL AWARE THAT THE ASSESSEE DID NOT SUBMIT ANY INFORMATION/EX PLANATION BEFORE THE AO DESPITE SUFFICIENT OPPORTUNITY ALLOWED. IN N UTSHELL THE LD. CIT(A) CANCELLED THE PENALTY ON THE BASIS OF ADDITIONAL EV IDENCE SUBMITTED BEFORE HIM WITHOUT FOLLOWING THE PROCEDURE LAID DOWN UNDER RUL E 46A OF THE IT RULES 1962 AND WITHOUT EVEN GRANTING ANY OPPORTUNITY TO THE AO . AS IS APPARENT FROM THE FACTS OF THE CASE THE LD. CIT(A) ARRIVED AT THE CO NCLUSIONS WITHOUT ASCERTAINING AS TO WHETHER OR NOT THE ASSESSEE WAS PREVENTED BY SUF FICIENT CAUSE FROM SUBMITTING THE AFORESAID ADDITIONAL DOCUMENTS/INFORMATION BEF ORE THE AO AS PER PROVISIONS OF RULE 46A OF THE IT RULES 1962 NOR THE LD. CIT(A ) SEEMS TO HAVE RECORDED ANY REASONS BEFORE ADMITTING THE AFORESAID DOCUMENTS IN EVIDENCE. HONBLE JURISDICTIONAL HIGH COURT IN THEIR DECISION IN THE CASE OF CIT VS. VALIMOHMED AHMEDBHAI 134 ITR 214(GUJ) WHILE REFERRING TO PROV ISIONS OF SEC. 46A OF THE IT RULES 1962 OBSERVED THAT NOTICE OF APPEAL ISSUED BY AN AAC CANNOT BE EQUATE D WITH NOTICE OF A FUTURE APPLICATION TO LEAD ADDITIO NAL EVIDENCE WHICH NO ONE COULD HAVE ANTICIPATED OR REASONABLY FORESEEN. HONBLE H IGH COURT HELD THAT ORDINARILY THE APPEAL WOULD BE DECIDED ON THE EVIDENCE RECORDE D IN THE COURSE OF ITA NO.1596/AHD/2010 . 6 ASSESSMENT PROCEEDINGS. THE ITO THEREFORE MAY NOT IN A GIVEN CASE THINK IT NECESSARY TO REMAIN PRESENT AT THE HEARING OF THE A PPEAL. HE HOWEVER CANNOT BE EXPECTED TO ANTICIPATE THAT ADDITIONAL EVIDENCE MIGHT BE PRODUCED BY THE ASSESSEE IN HIS APPEAL. IT IS FOR THIS REASON THAT IT IS NECESSARY TO GIVE HIM AN OPPORTUNITY TO MEET THE ADDITIONAL EVIDENCE. THE TR IBUNAL HAS THEREFORE FALLEN INTO AN ERROR IN REJECTING THE PLEA OF THE REVENUE THAT THE AAC OUGHT TO HAVE GIVEN AN OPPORTUNITY TO THE ITO TO EXAMINE THE ADDI TIONAL EVIDENCE OR TO CROSS- EXAMINE THE WITNESSES WHOSE EVIDENCE WAS TAKEN ON R ECORD OR TO REBUT THE ADDITIONAL EVIDENCE HONBLE HIGH COURT CONCLUDED. HERE WE MAY HAVE A LOOK AT THE RELEVANT PROVISIONS OF RULE 46A OF THE IT RUL ES 1962 WHICH READS AS UNDER: (1) THE APPELLANT SHALL NOT BE ENTITLED TO PRODUCE BEFORE THE DEPUTY COMMISSIONER (APPEALS) OR AS THE CASE MAY BE THE COMMISSIONER (APPEALS) ANY EVIDENCE WHETHER ORAL OR DOCUMENTARY OTHER TH AN THE EVIDENCE PRODUCED BY HIM DURING THE COURSE OF PROCEEDINGS BEFORE THE ASS ESSING OFFICER EXCEPT IN THE FOLLOWING CIRCUMSTANCES NAMELY:-- (A) WHERE THE ASSESSING OFFICER HAS REFUSED TO ADMI T EVIDENCE WHICH OUGHT TO HAVE BEEN ADMITTED;OR (B) WHERE THE APPELLANT WAS PREVENTED BY SUFFICIENT CAUSE FROM PRODUCING THE EVIDENCE WHICH HE WAS CALLED UPON TO PRODUCE BY THE ASSESSING OFFICER; OR (C) WHERE THE APPELLANT WAS PREVENTED BY SUFFICIENT CAUSE FROM PRODUCING BEFORE THE ASSESSING OFFICER ANY EVIDENCE WHICH IS RELEVAN T TO ANY GROUND OF APPEAL; OR (D) WHERE THE ASSESSING OFFICER HAS MADE THE ORDER APPEALED AGAINST WITHOUT GIVING SUFFICIENT OPPORTUNITY TO THE APPELLANT TO A DDUCE EVIDENCE RELEVANT TO ANY GROUND OF APPEAL. (2) NO EVIDENCE SHALL BE ADMITTED UNDER SUB-RULE (1 ) UNLESS THE DEPUTY COMMISSIONER (APPEALS) OR AS THE CASE MAY BE THE C OMMISSIONER (APPEALS) RECORDS IN WRITING THE REASONS FOR ITS ADMISSION. (3)THE DEPUTY COMMISSIONER(APPEALS) OR AS THE CA SE MAY BE THE COMMISSIONER (APPEALS) SHALL NOT TAKE INTO ACCOUNT ANY EVIDENCE PRODUCED UNDER SUB-RULE (1) UNLESS THE INCOME-TAX OFFICER HA S BEEN ALLOWED A REASONABLE OPPORTUNITY (A) TO EXAMINE THE EVIDENCE OR DOCUMENT OR TO CROSS-EXAMINE THE WITNESS PRODUCED BY THE APPELLANT OR (B) TO PRODUCE ANY EVIDENCE OR DOCUMENT OR ANY WITN ESS IN REBUTTAL OF THE ADDITIONAL EVIDENCE PRODUCED BY THE APPELLANT ITA NO.1596/AHD/2010 . 7 (4) NOTHING CONTAINED IN THIS RULE SHALL AFFECT THE POWER OF THE DEPUTY COMMISSIONER (APPEALS) OR AS THE CASE MAY BE THE COMMISSIONER (APPEALS) TO DIRECT THE PRODUCTION OF ANY DOCUMENT OR THE EXAMI NATION OF ANY WITNESS TO ENABLE HIM TO DISPOSE OF THE APPEAL OR FOR ANY OTH ER SUBSTANTIAL CAUSE INCLUDING THE ENHANCEMENT OF THE ASSESSMENT OR PENALTY (WHETH ER ON HIS OWN MOTION OR ON THE REQUEST OF THE ASSESSING OFFICER) UNDER CLAUSE (A) OF SUB SECTION (1) OF SECTION 251 OR THE IMPOSITION OF PENALTY UNDER SECT ION 271..' 5.1 IT IS EVIDENT FROM THE AFORESAID PROVISIONS THAT THE LD. CIT(A) CAN TAKE INTO ACCOUNT ANY EVIDENCE PRODUCED UNDER SUB-R. (1)(B) & (C) OF RULE 46A OF THE IT RULES 1962 IF THE ASSESSEE WAS PREVENTED BY SUFF ICIENT CAUSE .IN THE CASE UNDER CONSIDERATION THE ASSESSEE PLACED BEFORE THE LD. CIT(A) THE AFORESAID DOCUMENTS PLACED AT SL. NOS. 3 4 6 9 & 11 TO 15 IN THE PAPER BOOK AND ADMITTEDLY THE SAID DETAILS/DOCUMENTS WERE NEVER SU BMITTED BEFORE THE AO.. MOREOVER THERE IS NOTHING TO SUGGEST AS TO WHETHER OR NOT THE LD. CIT(A) RECORDED ANY REASONS BEFORE ADMITTING THE AFORESAI D DOCUMENTS BY WAY OF ADDITIONAL EVIDENCE EVEN WHEN HE OBSERVED THAT THAT THESE DETAILS HAD CRUCIAL IMPLICATION FOR THE ISSUE BEFORE HIM. SINCE IN THE CASE UNDER CONSIDERATION THE ADDITIONAL EVIDENCE/DOCUMENTS FILED BEFORE THE LEAR NED CIT(A) HAVE BEEN ADMITTED WITHOUT RECORDING ANY FINDINGS AS TO WHETH ER OR NOT THE ASSESSEE WAS PREVENTED BY SUFFICIENT CAUSE FROM PRODUCING THE SA ID EVIDENCE/DOCUMENTS BEFORE THE AO AND WITHOUT RECORDING ANY REASONS IN TERMS OF RULE 46A(2) OF THE IT RULES 1962 WE FIND MERIT IN THE UNDISPUTED CONT ENTIONS OF THE LEARNED DR AND THEREFORE IN THE INTEREST OF JUSTICE AND FAIR PLA Y VACATE THE FINDINGS OF THE LD. CIT(A) AND RESTORE THE ISSUES RAISED IN GROUND NOS . 1 & 2 OF THE APPEAL BEFORE US TO HIS FILE WITH THE DIRECTIONS TO FOLLOW THE M ANDATE IN TERMS OF RULE 46A OF THE IT RULES 1962 AS ALSO PRINCIPLES OF NATURAL JUSTIC E AND THEREAFTER DISPOSE OF THE MATTER IN ACCORDANCE WITH LAW AFTER ALLOWING SUFFI CIENT OPPORTUNITY TO BOTH THE PARTIES. WITH THESE DIRECTIONS GROUND NOS. 1 & 2 RAISED IN THIS APPEAL ARE DISPOSED OF AS INDICATED HEREINBEFORE. 6. GROUND NOS. 3 & 4 BEING MERE PRAYER DO NOT REQUIRE ANY SEPARATE ADJUDICATION AND ARE THEREFORE DISMISSED. ITA NO.1596/AHD/2010 . 8 7. IN THE RESULT APPEAL IS ALLOWED FOR STATISTICA L PURPOSES. ORDER PRONOUNCED IN THE COURT TODAY ON 19 -08-2010 SD/- SD/- (BHAVNESH SAINI) JUDICIAL MEMBER (A N PAHUJA) ACCOUNTANT MEMBER DATE : 19 -08-2010 COPY OF THE ORDER FORWARDED TO: 1. M/S UMESH COTTON GINNING AND SPINNING PVT. LTD. 702 ROSEWOOD ESTATE NR. PRERNATIRTH JAIN TEMPLE M NR. JODHPUR CROSS ROAD SATELLITE AHMEDABAD-15 2. ITO WARD-8(4) AHMEDABAD 3. CIT CONCERNED 4. CIT(A)-XIV AHMEDABAD 5. DR BENCH-C ITAT AHMEDABAD 6. GUARD FILE BY ORDER DEPUTY REGISTRAR ASSISTANT REGISTRAR ITAT AHMEDABAD