The DCIT, Central Circle-1(1),, Ahmedabad v. Smt. Anandiben Mahendrabhai Patel, Ahmedabad

ITSSA 279/AHD/2010 | 2003-2004
Pronouncement Date: 16-07-2010 | Result: Partly Allowed

Appeal Details

RSA Number 27920516 RSA 2010
Assessee PAN ACMPP3642F
Bench Ahmedabad
Appeal Number ITSSA 279/AHD/2010
Duration Of Justice 3 month(s) 10 day(s)
Appellant The DCIT, Central Circle-1(1),, Ahmedabad
Respondent Smt. Anandiben Mahendrabhai Patel, Ahmedabad
Appeal Type Income Tax (Search & Seizure) Appeal
Pronouncement Date 16-07-2010
Appeal Filed By Department
Order Result Partly Allowed
Bench Allotted B
Tribunal Order Date 16-07-2010
Date Of Final Hearing 02-07-2010
Next Hearing Date 02-07-2010
Assessment Year 2003-2004
Appeal Filed On 06-04-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH 'B' [BEFORE SHRI MAHAVIR SINGH JM & SHRI A N PAHUJA AM] IT(SS)A NO.279/AHD/2010 WITH C O NO.149/AHD/2010 (ASSESSMENT YEAR:-2003-04) DEPUTY COMMISSIONER OF INCOME-TAX CENTRAL CIRCLE- 1(1) AHMEDABAD V/S SMT. ANANDIBEN MAHENDRABHAI PATEL C/O PADMAVATI TRADING CO. JETALPUR TAL: DASCROI DIST. AHMEDABAD [PAN: ACMPP 3642 F] [APPELLANT] [RESPONDENT] REVENUE BY :- SHRI K MADHUSUDAN DR ASSESSEE BY:- SHRI VIJAY RANJAN AR O R D E R A N PAHUJA: THIS APPEAL BY THE REVENUE AND CROSS- OBJECTION[ CO] BY THE ASSESSEE DIRECTED AGAINST AN ORDER DATED 21-01-2010 OF THE LD. CIT(APPEALS)-III AHMEDABAD RAISE THE FOLL OWING GROUNDS:- IT(SS)A NO.279/AHD/2010 1 THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN D ELETING THE ADDITION OF RS.90 000/- MADE ON ACCOUNT OF HOUSEHOLD EXPENSES. 2 THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN D ELETING THE ADDITION OF RS.13 60 822/- MADE ON ACCOUNT OF UNEXPLAINED INVES TMENT. 3 THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN A DMITTING ADDITIONAL EVIDENCE IN CONTRAVENTION OF RULE 46A OF I.T. RULES 1962. HE HAS ALSO NOT ACCORDED THE AO AN OPPORTUNITY OF BEING HEARD A ND TO REBUT THE EVIDENCE PRODUCED BY THE ASSESSEE IN CONTRAVENTION TO THE RATIO LAID DOWN BY THE GUJARAT HIGH COURT IN THE CASE OF CIT(G UJARAT) VS. VALIRAM BHERUMAL 134 ITR 214. 4 ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE CIT(A) OUGHT TO HAVE UPHELD THE ORDER OF THE AO. 5 IT IS THEREFORE PRAYED THAT THE ORDER OF THE CI T(A) BE SET ASIDE AND THAT OF THE AO BE RESTORED TO THE ABOVE EXTENT. IT(SS)A NO.279/AHD/2010 & CO 149/AHD/2010 FOR AY 2003-04 SMT. ANANDIBEN M PATEL 2 C O NO.149/AHD/2010 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE THE CIT(A) ERRED IN NOT UPHOLDING THE ASSESSEES CONTENTION TH AT IT IS NOT AT ALL A FIT CASE FOR INVOKING THE PROVISIONS OF SECTI ON 153C R.W.S 153A 2. WITHOUT PREJUDICE ON THE FACTS AND IN THE CIRCU MSTANCES OF THE CASE THE CIT(A) SHOULD HAVE REALIZED THAT THE ASSE SSING OFFICER WAS NOT JUSTIFIED IN EMBARKING UPON PROCESSING AND SCRUTINY OF THE ASSESSMENT IN A FASHION WHICH WAS PERMISSIBLE U /S 143(3) BUT IN THIS PARTICULAR CASE IT WAS NOT PERMISSIBLE U/S 153C R.W.S 153A. 3. THE RESPONDENT CRAVES LEAVE TO ADD ALTER AMEND AND /OR WITHDRAW ANY GROUND OR GROUNDS OF CROSS OBJECTION E ITHER BEFORE OR DURING THE COURSE OF HEARING OF THE SAME. 2 ADVERTING FIRST TO GROUND NO.1 IN THE APPEAL OF T HE REVENUE FACTS IN BRIEF AS PER RELEVANT ORDERS ARE THAT A SEARCH U/S. 132(1) OF THE INCOME-TAX ACT 1961 [HEREINAFTER REFERRED TO A S THE ACT]. WAS CONDUCTED ON 22-09-2005 IN THE CASE OF SHRI SANJAY R. SHAH & MEGHMANI GROUP WHEN A NUMBER OF DOCUMENTS / BOOKS OF ACCOUNT / OTHER VALUABLE ARTICLES/THINGS WERE SEIZED .ON THE BASIS OF DOCUMENTS SEIZED FROM THE RESIDENTIAL PREMISES OF S HRI LALIT K. PATEL & KANTIBHAI M. PATEL 31 PARK HILL SOCIETY OPP: K ARNAVATI CLUB S.G. HIGHWAY AHMEDABAD AS MENTIONED IN PARA 1.1 OF THE ASSESSMENT ORDER THE ASSESSING OFFICER[AO IN SHO RT] INITIATED ASSESSMENT PROCEEDINGS WITH THE ISSUE OF NOTICE U/S 153C R.W.S. 153A OF THE ACT ON 08-05-2006 AFTER RECORDING NECE SSARY SATISFACTION WITHIN THE MEANING OF PROVISIONS OF SE CTION 153C(1) OF THE ACT . IN RESPONSE THE ASSESSEE FILED RETURN DE CLARING INCOME OF RS.64 177/- ON 21.6.2006. EVEN THE RETURN FILED ORI GINALLY ON 21.11.2003 DECLARED THE SAME INCOME. DURING THE COU RSE OF ASSESSMENT PROCEEDINGS THE AO NOTICED THAT SEIZED PAPERS RELATED TO THE A.Y. 2006-07.IN RESPONSE TO A NOTICE ISSUED ON 11-10-07 U/S 142(1) OF THE ACT THE ASSESSEE REQUESTED TO FINALI ZE HER ASSESSMENT ON THE BASIS OF RECORDS AVAILABLE WITH THE DEPARTME NT AND HER SUBMISSIONS FILED VIDE LETTER DATED 14-09-07. SINCE THE TERMS AND IT(SS)A NO.279/AHD/2010 & CO 149/AHD/2010 FOR AY 2003-04 SMT. ANANDIBEN M PATEL 3 REQUIREMENTS OF A NOTICE U/S 142(1) OF THE ACT STAT ED TO BE IN THE FORM OF SUPPLEMENTARY QUESTIONNAIRE/ SHOWCAUSE ISSU ED ON 05.11.07 WERE NOT COMPLIED WITH THE AO COMPLETED THE ASSESS MENT EX-PARTE. 3. SINCE THE ISSUE OF HOUSEHOLD EXPENSES WAS SEP ARATELY CONSIDERED IN THE CASE OF SHRI PARESH M. PATEL AND SHRI PINAL M. PATEL ALSO THE AO ASKED THE ASSESSEE TO JUSTIFY HO USEHOLD EXPENSES FOR HERSELF AND HER SON SWAPNIL HIS WIFE AND CHILDREN. EVEN THOUGH THE ASSESSEE FURNISHED THE DETAILS OF NUMBER OF FAMILY MEMBERS AND AMOUNT INCURRED TOWARDS HOUSEHOLD EXPEN SES IN THE ABSENCE OF ANY EXPLANATION REGARDING SOURCE OF SUC H EXPENDITURE AND ITS SUFFICIENCY THE AO SHOW-CAUSED THE ASSESS EE ON 05-11-07 TO EXPLAIN THE SOURCE OF SUCH WITHDRAWAL/ EXPENSES CONSIDERING THE SIZE AND LIVING STANDARD OF THE FAMILY ALONG WITH D OCUMENTARY EVIDENCE. SINCE THE ASSESSEE DID NOT RESPOND NOR SU BMITTED ANY PROOF/DOCUMENTARY EVIDENCE REGARDING SOURCE OF HOUS EHOLD EXPENDITURE THE AO ESTIMATED HOUSEHOLD EXPENSES IN VARIOUS ASSESSMENT YEARS AS UNDER: A.Y. HOUSEHOLD EXPENSES TOTAL HOUSEHOLD PER MONTH EXPENSES FOR THE YEAR 2001-02 6500 78000 2002-03 7000 84000 2003-04 7500 90000 2004-05 8000 96000 2005-06 8500 102000 2006-07 9000 . 108000 ACCORDINGLY AN AMOUNT OF RS. 90 000/- WAS ADDED I N THE YEAR UNDER CONSIDERATION. 4. ON APPEAL THE LD. CIT(A) DELETED THE ADDITION I N THE FOLLOWING TERMS: IT(SS)A NO.279/AHD/2010 & CO 149/AHD/2010 FOR AY 2003-04 SMT. ANANDIBEN M PATEL 4 5.2 IN THE SUBMISSIONS THE APPELLANT POINTED OUT T HAT ALONG WITH OTHER FAMILY MEMBERS WITHDRAWALS HAD BEEN MADE FROM BANK ACCOUNTS OF THE FAMILY WHICH WERE MORE THAN THE ESTIMATES OF THE A. O. THE APPELLANT/FAMILY HAD ACCESS TO THE VARIOUS AGRICULTURAL PRODUCE FROM THE AGRICULTURAL LAND OWNED. THESE FACTS WERE BROUGHT TO-THE NOTICE OF TH E A.O. ALSO DURING THE ASSESSMENT PROCEEDINGS AND PHOTO COPY OF BANK STATE MENT HAD BEEN FILED WITH THE LETTER / REPLY DATED 26TH OCTOBER 2007. T HE A.O. HAS HOWEVER NOT CONSIDERED THESE DETAILS. IT WAS FURTHER ARGUED THA T THE FAMILY WAS LIVING TOGETHER AND THAT WITHDRAWALS OF THE FAMILY/HUF WER E SUFFICIENT AND ADEQUATE TO COVER THE HOUSEHOLD EXPENDITURE. THESE WITHDRAWA LS OF THE FAMILY WERE QUANTIFIED AS UNDER: ASSESSMENT YEARS NAME 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 NITINKUMAR VADILAL HUFS.B. A/C.NO.5138 80000 275300 233500 393293 134500 45050 232000 NITINKUMAR VADILAL INDL S.B.A/CNO.2108 71000 93700 83350 75130 211250 197975 88722 PADMABEN VADILAL S.B.A/C.NO.1113 89000 60770 170854 249425 166500 177300 141934 DAKSHABEN NITINBHAI S.B.A/C.NO.4763 90000 103000 DETAILS NOT AVAILABLE 48200 47896 75000 106100 MAHENDRAKUMAR VADILAL HUF SB A/C.NO.5139 79736 276000 425800 219650 158650 77660 78900 MAHENDRAKUMAR VADILAL INDL.SB A/C.NO.1114 48909 192840 236000 55500 99500 8925 NIL IT(SS)A NO.279/AHD/2010 & CO 149/AHD/2010 FOR AY 2003-04 SMT. ANANDIBEN M PATEL 5 ANANDIBEN MAHENDRAKUMAR S.BA/C.NO.1454 & 5668 27000 71600 . 25500 90508 NIL 101500 10000 231915 NIL 231346 100000 PARESH M. PATEL S.B.A/C NO.5207 & 5667 DETAILS NOT AVAILABLE DETAILS NOT AVAILABLE 84200 NIL 25000 22000 6000 PINAL M. PATEL S.B.A/C.NO.5208 &5666 47000 60895 177000 NIL NIL 50000 5000 SWAPNIL M. PATEL S.B.A/C.NO.5908 & 5584 DETAILS NOT AVAILABLE DETAILS NOT AVAILABLE DETAILS NOT AVAILA- BLE NIL 24723 NIL 83600 42775 25800 46308 199000 6. ON CAREFUL CONSIDERATION OF THE CONTENTIONS/MAT ERIAL ON RECORD IT IS SEEN THAT THE REASONS OF THE A.O. FOR MAKING THE HO USEHOLD ADDITIONS WERE BASED ENTIRELY ON SURMISES AND CONJECTURES. THE A.O . WAS INFORMED OF THE HOUSEHOLD EXPENSES IN THE REPLIES OF THE APPELLANT FILED BEFORE THE A.O. THE A.O. HAD NOT RAISED FURTHER QUERIES. THE A.O. D ID NOT ACT TO EXAMINE/VERIFY THE WITHDRAWALS MADE BY THE APPELLAN T/FAMILY MEMBERS AND ALSO FAILED TO CONSIDER THE AVAILABILITY OF AGRICUL TURAL PRODUCE THE SAVINGS BY COMMUNITY LIVING IN SMALL TOWNS. ON A HOLISTIC CONSIDERATION THEREFORE THE ADDITIONS MADE FOR HOUSEHOLD EXPENSES AS MENTI ONED ARE DELETED FOR ALL THE ASSESSMENT YEARS UNDER APPEAL. THE RELATED GROUNDS OF APPEAL ARE ALLOWED. 5. THE REVENUE IS NOW IN APPEAL BEFORE US AGAINST THE AFORESAID FINDINGS OF THE LD. CIT(A). THE LD. DR MERELY RELIE D UPON THE ORDER OF THE AO WHILE THE LD. AR ON BEHALF OF THE ASSESSEE S UPPORTED THE FINDINGS OF THE LD. CIT(A). 6 WE HAVE HEARD BOTH THE PARTIES AND GONE THROUGH THE FACTS OF THE CASE. UNDISPUTEDLY THE AO ESTIMATED THE HOUSEH OLD EXPENSES WITHOUT CONSIDERING THE DETAILS FILED BEFORE HIM IN RESPECT OF DRAWINGS MADE BY VARIOUS MEMBERS OF THE FAMILY. AS POINTED OUT BY THE LD. CIT(A) THE ADDITION WAS MADE ON SURMISES A ND CONJECTURES. IT(SS)A NO.279/AHD/2010 & CO 149/AHD/2010 FOR AY 2003-04 SMT. ANANDIBEN M PATEL 6 IN THE FACTS AND CIRCUMSTANCES OF THE CASE WE ARE OF THE OPINION THAT THERE IS NO BASIS FOR ESTIMATE MADE BY THE AO. THE REVENUE HAVE NOT PLACED BEFORE US ANY MATERIAL CONTROVERTING THE FINDINGS OF THE LD. CIT(A).IN THE ABSENCE OF ANY BASIS SO AS TO ENABLE US TO TAKE A DIFFERENT VIEW IN THE MATTER WE ARE NOT INCLINED TO INTERFERE. THEREFORE GROUND NO.1 RAISED BY THE REVENUE FOR THE SAID ADDITION IS DISMISSED. 7. GROUND NOS. 2 & 3 RELATE TO ADDITION OF R S.13 60 822/- ON ACCOUNT OF UNEXPLAINED INVESTMENT IN THE TWO FIRMS. ON PERUSAL OF DETAILS THE AO NOTICED THAT THE ASSESSEE DEPOSIT ED RS.11 89 100/- IN THE FIRM M/S PADMAVATI TRADING CO. AS DETAILED HEREUNDER: AMOUNT (IN RS.) DATE OF DEPOSIT 162900 22-06-02 174200 25-06-02 107000 23-07-02 100000 07-10-02 375000 21-10-02 70000 16-11-02 .100000 27-11-02 100000 10-01-03 BESIDES AN AMOUNT OF RS.171722 IN THE FIRM M/S R. M AHENDRAKUMAR & CO. ON 30-06-2002. THE ASSESSEE IS STATED TO BE P ARTNER IN THESE TWO FIRMS. SINCE THE ASSESSEE DID NOT FURNISH ANY E VIDENCE IN RESPECT OF SOURCE OF THE AFORESAID DEPOSITS DESPIT E REPEATED REQUESTS LAST BEING A NOTICE DATED 02-11-2007 U/S . 142(1) OF THE ACT THE AO ADDED THE ENTIRE AMOUNT OF RS.13 60 822 /- HAVING RECOURSE TO PROVISIONS OF SEC. 68 OF THE ACT. 8. ON APPEAL THE LEARNED CIT(A) DELETED THE ADDIT ION IN THE FOLLOWING TERMS: IT(SS)A NO.279/AHD/2010 & CO 149/AHD/2010 FOR AY 2003-04 SMT. ANANDIBEN M PATEL 7 8. BEFORE ME IT WAS SUBMITTED THAT THE AO HAD NOT PROVIDED PROPER AND ADEQUATE OPPORTUNITY. IT WAS SUBMITTED B Y THE ASSESSEE AS UNDER: AS REGARDS THE CREDIT OF RS.11 89 100 WITH M/S. PAD MAVATI TRADING CO. IS CONCERNED THE ASSESSEE'S HUSBAND SH RI MAHENDRAKUMAR VADILAL PATEL DIED OF ACCIDENT ON 19- 5-2002 AND ON THE DEATH OF HER HUSBAND SHE RECEIVED THE FO LLOWING AMOUNTS FROM THE LIC OF INDIA IN RESPECT OF VARIOU S INSURANCES TAKEN BY HIM:- POLICY NO BANK/ CHEQUE NO AMOUNT RECEIVED ON AMOUNT DATE OF DEPOSIT IN BANK ACCOUNT 832266167 LIC UNION BK OF INDIA 009046 22.6.2002 162900 22.06.02 830630656 LIC 830627146 LIC UNION BK OF INDIA 013279 UNION BK OF -INDIA 013280 25.6.2002 25.6.2002 20000 154200 25.06.02 834009746 LIC VIJYA BK. 705922 23.7.2002 107000 22.07.02 83 4009746 LIC VIJYA BK. 708442 07.10.2002 100000 5.10.02 7875/2002 ORIENTAL INSU. CO. (PERSONAL ACCIDENT) BANK OF INDIA 164850 21.10.2002 375000 19.10.02 830627 146 LIC UNION BK OF INDIA 021446 16.11.2002 70000 13.11.02 IT(SS)A NO.279/AHD/2010 & CO 149/AHD/2010 FOR AY 2003-04 SMT. ANANDIBEN M PATEL 8 832 266 167 LIC UNION BK OF INDIA 023276 27.11.2002 100000 30.10.02 ICICI 549948 10.01.2003 100000 7.01.03 TOTAL: 1189100. AGAINST ABOVE AMOUNTS CHEQUES WERE DEPOSITED WIT H FIRM PADMAVATI TRADING CO. AS UNDER: DATE CH. NO. AMOUNT 22.06.02 0049 162900 25.06.02 0053 174200 23.07.02 0068 107000 07.10.02 0088 100000 21.10.02 0089 375000 16.11.02 0095 70000 27.11.02 0114 100000 10.01.03 0210 100000 TOTAL 1189100 THUS ALL THE AMOUNTS ARE RECEIVED BY ACCOUNT PAYEE CHEQUES AND SHE HAS DEPOSITED THESE AMOUNTS IN THE FIRM M/S. PADMAVATI TRADING CO. ALL THESE AMOUNT RECEIVED BY ACCOUNT PAYEE CHEQUES WERE FIRST DEPOSITED IN THE ASSESSEE'S SAVING A/C. NO. 1454 \VITH AHMEDABAD DIS TRICT CO-OPERATIVE BANK JETALPUR BRANCH AND FROM THERE THESE AMOUNTS WERE TRANSFERRED TO THE FIRM PADMAVATI TRADING CO. COPIES OF LIC POLICI ES ETC. AND COPY OF BANK SAVING A/C. ETC. ARE ALSO ENCLOSED. IT(SS)A NO.279/AHD/2010 & CO 149/AHD/2010 FOR AY 2003-04 SMT. ANANDIBEN M PATEL 9 AS REGARDS CREDIT OF RS.1 71 722 WITH THE FIRM R. M AHENDRAKUMAR & CO THE SAME WAS ON ACCOUNT OF THE MONEY RECEIVED BY TH E ASSESSEE AS PER THE WILL OF HER LATE HUSBAND SHRI MAHENDRABHAI V. P ATEL. COPY OF ACCOUNT OF LATE MAHENDRABHAI V. PATEL FROM R MAHENDRAKUMAR & CO. AND COPY OF ACCOUNT OF THE ASSESSEE FROM THE SAID FIRM ARE ENCL OSED. THE APPELLANT HAS ALSO ENCLOSED PHOTO COPIES OF LIC POLICIES/EVIDENCE OF DISBURSEMENT COPY OF BANK ACCOUNT OF THE APPELLANT IN THE AHMEDABAD DISTRICT CO-OP. BANK COPY OF ACCOUNT OF THE LATE H USBAND OF THE APPELLANT IN THE BOOKS OF ACCOUNT COPIES OF THE REVENUE DOCU MENT 7/12 IN SUPPORT OF THE CONTENTION OF THE OWNERSHIP OF AGRICULTURAL LAND AND SO ON. 9. THE CONTENTIONS WERE CAREFULLY PERUSED. IT IS S EEN THAT THE AO HAD SOUGHT EXPLANATION FOR THE DEPOSITS IN THE FIRM VID E QUESTIONNAIRE ISSUED ON 2/11/2007. THE AO HAS NOT MENTIONED THE DATE/DETAIL S OF ITS SERVICE. THE ASSESSMENT HAS BEEN FRAMED ON 30/11/2007. IN THESE FACTS IT APPEARS THAT THE APPELLANT WAS NOT GIVEN ADEQUATE OPPORTUNI TY. THE APPELLANT HAD FILED COPIES OF THE BANK STATEMENT AND EVIDENCE OF THE PAYMENTS MADE BY INSURANCE COMPANIES ETC. WHICH SUPPORT THE CONTENT IONS OF THE APPELLANT THAT THESE AMOUNTS HAD DEVOLVED ON HER OWING TO DE ATH OF HER HUSBAND. IN THESE FACTS THE ADDITIONS MADE BY THE AO WERE N OT SUSTAINABLE AND ARE THEREFORE DELETED. THE RELATED GROUNDS OF APPEAL AR E ADJUDICATED ACCORDINGLY. 9. THE REVENUE IS NOW IN APPEAL BEFORE US AGA INST THE AFORESAID FINDINGS OF THE LD. CIT(A) DELETING THE ADDITION. THE LD. DR W HILE INVITING OUR ATTENTION TO THE IMPUGNED ORDERS AND PAPER BOOK FILED BY THE ASSESS EE SUBMITTED THAT THE ASSESSEE DID NOT SUBMIT ANY EVIDENCE BEFORE THE AO IN RESPECT OF SOURCE OF DEPOSITS OF RS.11 89 100/- ON VARIOUS DATES IN THE FIRM PADMAVATI TRADING CO. AND DEPOSIT OF RS.1 71 722/- IN THE FI RM R. MAHENDRAKUMAR & CO. ON 30-06-2002 DESPITE SUFFICIEN T OPPORTUNITY ALLOWED WHILE THE LD. CIT(A) ADMITTED FRESH EVIDEN CE IN CONTRAVENTION OF RULE 46A OF THE IT RULES 1962 AND DELETED THE ADDITIONS . ON THE OTHER HAND THE LD. AR ON BEHALF OF THE ASSESSEE MERELY SUPPORTED THE F INDINGS OF THE LD. CIT(A). 10. WE HAVE HEARD BOTH THE PARTIES AND GONE T HROUGH THE FACTS OF THE CASE. UNDISPUTEDLY THE LD. CIT(A) DELETED THE ADDITION OF RS.11 89 100/- DEPOSITED ON VARIOUS DATES AS MENTIONED ABOVE IN THE FIRM M/S PADMAVATI IT(SS)A NO.279/AHD/2010 & CO 149/AHD/2010 FOR AY 2003-04 SMT. ANANDIBEN M PATEL 10 TRADING CO. AND DEPOSIT OF RS.1 71 722/- IN THE FI RM M/S R. MAHENDRAKUMAR & CO. ON 30-06-2002 ON THE BASIS OF C ERTAIN DOCUMENTS EVIDENCING RECEIPT OF VARIOUS AMOUNTS FR OM THE INSURANCE COMPANIES ON THE DEATH OF HER HUSBAND. AD MITTEDLY THESE DOCUMENTS PLACED IN PAPER BOOK ON PAGE 49 TO 113 WE RE NEVER SUBMITTED BEFORE THE AO. AS IS APPARENT FROM THE F ACTS OF THE CASE THE LD. CIT(A) ARRIVED AT THE CONCLUSIONS WITHOUT ASCERTAIN ING AS TO WHETHER OR NOT THE ASSESSEE WAS PREVENTED BY SUFFICIENT CAUSE FROM SUB MITTING THE AFORESAID ADDITIONAL DOCUMENTS/INFORMATION BEFORE THE AO AS PER PROVISIONS OF RULE 46A OF THE IT RULES 1962 NOR THE LD. CIT(A) RECORDED ANY REASONS BEFORE ADMITTING THE AFORESAID DOCUMENTS IN EVIDENCE. IN THIS CONNEC TION HONBLE JURISDICTIONAL HIGH COURT IN THEIR DECISION IN THE CASE OF CIT VS. VALIMOHMED AHMEDBHAI 134 ITR 214(GUJ) WHILE REFERRING TO PROVISIONS 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 ADDITIONAL EVIDENCE WHICH NO ONE COULD HAVE ANTICIPATED OR REASONABLY FORESEEN. HONBLE HIGH C OURT HELD THAT ORDINARILY THE APPEAL WOULD BE DECIDED ON THE EVIDENCE RECORDED IN THE COURSE OF ASSESSMENT PROCEEDINGS. THE ITO THEREFORE MAY NOT IN A GIVE N CASE THINK IT NECESSARY TO REMAIN PRESENT AT THE HEARING OF THE APPEAL. HE HO WEVER CANNOT BE EXPECTED TO ANTICIPATE THAT ADDITIONAL EVIDENCE MIGHT BE PRODUC ED 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 TRIBUNAL HAS THEREFOR E FALLEN INTO AN ERROR IN REJECTING THE PLEA OF THE REVENUE THAT THE AAC OUGH T TO HAVE GIVEN AN OPPORTUNITY TO THE ITO TO EXAMINE THE ADDITIONAL EVIDENCE OR TO CROSS-EXAMINE THE WITNESSES WHOSE EVIDENCE WAS TAKEN ON RECORD OR TO REBUT THE ADDITIONAL EVIDENCE HONBLE HIGH COURT CONCLUDED. HERE WE MAY HAVE A LOOK AT TH E RELEVANT PROVISIONS OF RULE 46A OF THE IT RULES 1962 WHICH READ 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 IT(SS)A NO.279/AHD/2010 & CO 149/AHD/2010 FOR AY 2003-04 SMT. ANANDIBEN M PATEL 11 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 (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..' 11. 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 SUFFI CIENT CAUSE .IN THE CASE UNDER CONSIDERATION THE ASSESSEE PLACED BEFORE THE LD. C IT(A) THE AFORESAID DOCUMENTS EVIDENCING RECEIPT OF VARIOUS AMOUNTS FR OM INSURANCE COMPANIES ON THE DEATH OF HER HUSBAND WHILE THERE IS NO EVIDENCE BEFORE US THAT THE SAID IT(SS)A NO.279/AHD/2010 & CO 149/AHD/2010 FOR AY 2003-04 SMT. ANANDIBEN M PATEL 12 DETAILS/DOCUMENTS WERE EVER SUBMITTED BEFORE THE AO . MOREOVER THERE IS NOTHING TO SUGGEST AS TO WHETHER OR NOT THE LD. CIT(A) REC ORDED ANY REASONS BEFORE ADMITTING THE AFORESAID DOCUMENTS BY WAY OF ADDITI ONAL EVIDENCE. SINCE IN THE CASE UNDER CONSIDERATION THE ADDITIONAL EVIDENCE/D OCUMENTS FILED BEFORE THE LEARNED CIT(A) HAVE BEEN ADMITTED WITHOUT RECORD ING ANY FINDINGS AS TO WHETHER OR NOT THE ASSESSEE WAS PREVENTED BY SUFFIC IENT CAUSE FROM PRODUCING THE SAID EVIDENCE/DOCUMENTS BEFORE THE AO AND WITHO UT RECORDING ANY REASONS IN TERMS OF RULE 46A(2) OF THE IT RULES 1962 WE FIND MERIT IN THE UNDISPUTED CONTENTIONS OF THE LEARNED DR AND THEREFORE IN THE INTEREST OF JUSTICE AND FAIR PLAY VACATE THE FINDINGS OF THE LD. CIT(A) AND RES TORE THE ISSUES RAISED IN GROUND NOS 2 &3 IN THE APPEAL BEFORE US TO HIS FILE WI TH THE DIRECTIONS TO FOLLOW THE MANDATE IN TERMS OF RULE 46A OF THE IT RULES 1962 AS ALSO PRINCIPLES OF NATURAL JUSTICE AND THEREAFTER DISPOSE OF THE MATTER IN ACCORDANCE WITH LAW AFTER ALLOWING SUFFICIENT OPPORTUNITY TO BOTH THE PARTIES . WITH THESE DIRECTIONS GROUND NOS. 2& 3 RAISED IN THE APPEAL ARE DISPOSED OF AS I NDICATED HEREINBEFORE. 12. GROUND NOS. 4 & 5 IN THE APPEAL BEING GENER AL IN NATURE DO NOT REQUIRE ANY SEPARATE ADJUDICATION AND ARE THERE FORE DISMISSED. 13. AS REGARDS GROUNDS RAISED IN THE CROSS-OBJE CTIONS ISSUES RAISED IN THESE GROUNDS DO NOT EMERGE FROM THE IMPU GNED ORDERS NOR THE LD. CIT(A) RECORDED ANY FINDINGS ON THESE ISSUE S. SINCE THE LEARNED AR ON BEHALF OF THE ASSESSEE DID NOT PRESS GROUNDS RAISED IN THE CROSS-OBJECTION THE CO IS THEREFORE DISMI SSED. IT(SS)A NO.279/AHD/2010 & CO 149/AHD/2010 FOR AY 2003-04 SMT. ANANDIBEN M PATEL 13 14. IN THE RESULT APPEAL OF THE REVENUE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES WHILE THE CO FILED BY THE ASSE SSEE IS DISMISSED. ORDER PRONOUNCED IN THE COURT TODAY ON 16-07-2010 SD/- SD/- (MAHAVIR SINGH) JUDICIAL MEMBER (A N PAHUJA) ACCOUNTANT MEMBER DATE : 16-07-2010 COPY OF THE ORDER FORWARDED TO: 1. SMT. ANANDIBEN MAHENDRABHAI PATEL C/O PADMAVATI TRADING CO. JETALPUR TAL: DASCROI DIST. AHMEDABAD 2. THE DCIT CENTRAL CIRCLE-1(1) AHMEDABAD 3. CIT CONCERNED 4. CIT(A)-III AHMEDABAD 5. DR BENCH-B ITAT AHMEDABAD 6. GUARD FILE BY ORDER DEPUTY REGISTRAR ASSISTANT REGISTRAR ITAT AHMEDABAD