Andhra Pradesh Housing Board, Hyderabad V. ACIT, Circle - 5(1), Hyderabad

ITA 1506/HYD/2013

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 6108 (ITAT-HYDERABAD)
• Duration Of Justice: 3 year(s) 3 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-02-2017
• Appeal Filed By: Assessee
• Bench Allotted: A
• Next Hearing Date: 07-11-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 14-11-2013
• Court: TRIBUNAL
• Department Lawyers: P CHANDRA SEKHAR
• Assessee Lawyers: A V RAGHURAM
• Keywords: Business income; Additional evidence
• Section: 142(1); 80IB; 147; 131; 148; 144

Judgement Text

THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A, HYDERABAD BEFORE SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER AND SHRI G. PAVAN KUMAR, JUDICIAL MEMBER ITA NO. 1506/HYD/2013 ASSESSMENT YEAR: 2009-10 ANDHRA PRADESH HOUSING BOARD, HYDERABAD PAN AAAAA5028R VS. THE ACIT, CIRCLE-5(1) HYDERABAD (APPELLANT) (RESPONDENT) ITA NOS. 1687/HYD/2013 ASSESSMENT YEAR: 2009-10 THE ACIT, CIRCLE-5(1) VS. ANDHRA PRAD ESH HOUSING HYDERABAD BOARD, HYDERABAD. P AN AAAAA5028R ASSESSEE BY : SHRI A.V. RAGHU RAM REVENUE BY : SHRI P. CHANDRA SEKHAR DATE OF HEARING : 13-02-2017 DATE OF PRONOUNCEMENT : 24-02-2017 ORDER PER G. PAVAN KUMAR, J.M.: THESE ARE THE CROSS APPEALS FILED BY THE ASSESSEE AND REVENUE AGAINST THE ORDER OF CIT-V, HYDERABAD VIDE ITA NO. 103/CIT(A)-V/HYD/2013-14, DATED 30-08-2013 PASSED U /S 144 R.W.S 147 AND 250 OF THE IT ACT. FOR THE SAKE OF CONVENIENCE WE TAKE UP THE APPEAL FILED BY THE ASSE SSEE. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL . 2 ITA NO. 1506 & 1687/HYD/2013 ANDHRA PRADESH HOUSING BOARD, HYDERABAD. 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E THE ASSESSING OFFICER ERRED IN ASSESSING THE APPELLANT HASTILY U/ S. 144 OF THE INCOME TAX ACT, 1961 WITHOUT AFFORDING REASO NABLE OPPORTUNITY TO ADDUCE COGENT, CREDIBLE AND CONVINCI NG EVIDENCE UP TO THE SATISFACTION OF THE ASSESSING OFFICER. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E THE LD. CIT (A) ERRED IN HOLDING THAT THE APPELLANT AS AN A FTERTHOUGHT RAISED THE GROUND OF WRONG ASSUMPTION OF JURISDICTION BEFO RE HIM TO TAKE A PLEA FOR SETTING ASIDE THE ORDER OF ASSESSMENT. 3. THE ORDER OF ASSESSMENT PASSED WAS NOT A SPEAKIN G ORDER AND HAS BEEN PASSED WITHOUT STATING REASONS TO THE OBJECTIONS RAISED BY THE APPELLANT TO THE NOTICE ISSUED U/S. 147 OF THE INCOME TAX ACT, 1961, HENCE NOT TENABLE IN THE EYE OF LAW. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E THE ASSESSING OFFICER ERRED IN PASSING THE ORDER OF ASS ESSMENT BASING ON MERE ASSUMPTIONS AND PRESUMPTIONS WITHOUT GIVING VALID OR SUBSTANTIAL REASONS FOR TAXING THE APPELLANT. THE O RDER IS BASED ON CONJECTURES AND IS CAPRICIOUS AND CANNOT BE TERMED AS A BEST JUDGMENT ASSESSMENT AS REQUIRED U/S. 144 OF THE INC OME TAX ACT, 1961. 5. THE LEARNED CIT (A) FAILED TO APPRECIATE THAT TH E APPELLANT BOARD WAS CONSTITUTED UNDER THE STATE ACT IN THE YE AR 1956 AND IS AN EXTENDED ARM OF THE GOVERNMENT TO SERVE THE PEOP LE BY PROVIDING HOUSING FACILITIES INCLUDING THE POOR, HENCE ITS IN COME CANNOT BE TAXED UNDER THE HEAD 'BUSINESS INCOME' OR ANY OTHER HEAD. 6. THE LEARNED CIT (A) ERRED IN HOLDING THAT THE AP PELLANT BOARD IS NOT AN AGENT OF THE STATE GOVERNMENT AND T HE INCOME ACCRUED IS NOT THE INCOME OF THE STATE GOVERNMENT. 7. THE LD. CIT (A) ERRED IN CONFIRMING THE ORDER OF ASSESSMENT IGNORING THE FACT THAT THE SURPLUS AMOUNT VESTS IN AND IS TRANSFERRED TO THE CONSOLIDATED FUND OF STATE OF ANDHRA PRADESH AND AS SUCH THE SAID INCOME CANNOT BE TAXED AT THE HANDS OF THE APPELLANT. 8. THE LEARNED CIT (A) ERRED IN COMPARING THE APPEL LANT WITH COMMERCIAL ORGANIZATION DEALING IN REAL ESTATE AND IN NOT HOLDING , THAT THE APPELLANT IS A NON-PROFIT ORGANIZATION WHI CH AIMS AT PROVIDING AFFORDABLE ACCOMMODATION TO THE PEOPLE. 9. THE LEARNED CIT (A) ERRED IN HOLDING THAT THE AP PELLANT IS NOT AN INSTRUMENTALITY OF THE STATE AS CONTEMPLATED U/ S , 2B9 OF THE CONSTITUTION OF INDIA WITHOUT ANALYZING THE PRE VAILING FACTS AND CIRCUMSTANCES OF THE CASE. 3 ITA NO. 1506 & 1687/HYD/2013 ANDHRA PRADESH HOUSING BOARD, HYDERABAD. 10. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE THE LEARNED CIT(A) ERRED IN HOLDING THAT THE SURPLUS FU NDS TRANSFERRED TO THE CONSOLIDATED FUND OF STATE OF AP IS NOTHING BUT APPLICATION OF ITS INCOME WITHOUT APPRECIATING THE FACT THAT BY OPERAT ION OF LAW THE SURPLUS VESTS IN THE STATE AND THE APPELLANT HAS NO RIGHT OF DISPOSAL. IN THE ABSENCE OF SUCH RIGHT OF DISPOSAL , THE FINDING THAT IT IS APPLICATION OF INCOME IS PERVERSE. 11. THE LD. CIT (A) OUGHT TO HAVE HELD THAT IN VIEW OF THE AMENDED PROVISION OF SECTIONS 58 AND 59 OF ANDHRA P RADESH HOUSING BOARD ACT, 1958 NO INCOME ACCRUED TO THE AP PELLANT AND THAT NO INCOME CAN BE TAXED IN THE HANDS OF THE APP ELLANT. 12. THE LD. CIT (A) ERRED IN CONFIRMING THE ORDER O F AO IN BRINGING TO TAX ALL DEPOSITS IN THE BANK ACCOUNTS O F THE APPELLANT ALLOWING ADMINISTRATIVE EXPENSES @ 10% WITHOUT GOIN G INTO THE DETAILS OF IT. 13. THE LD. CIT (A) ERRED IN CONFIRMING THE TOTAL I NCOME OF THE APPELLANT AT RS. 1197,32,42,050/- AS DONE BY THE AS SESSING OFFICER WITHOUT CALLING FOR ANY DETAILS AS BY NO STRETCH OF IMAGINATION THE SAID INCOME CAN BE CONSIDERED TO BE THE INCOME OF T HE APPELLANT. 14. THE APPELLANT CRAVES LEAVE TO ADD OR AMEND ANY GROUNDS THAT MAY BE URGED AT THE TIME OF HEARING. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E IS ENGAGED IN HOUSING PROJECT OF PURCHASE AND SALE OF LAND AND JOINT VENTURES IN HOUSING PROJECTS. THE ASSESSEE H AS FILED THE RETURN OF INCOME UP TO A.Y. 2008-09 AND CLAIMED EXE MPTION UNDER 80IB OF THE IT ACT. DURING THE FINANCIAL YEA R 2008-09 THE LD. A.O FOUND THAT THERE ARE HUGE DEPOSITS RECE IPTS IN THE ASSESSEE BANK ACCOUNT AND THE ASSESSEE HAS EARNED I NCOME BUT NOT FILED RETURN OF INCOME THE LD. AO ISSUED N OTICE U/S 148 AND 142(1) OF THE IT ACT ALONG WITH QUESTIONNAI RE. AFTER A LONG PERIOD OF REMAINDERS THE LD. A.R OF THE ASSESS EE APPEARED AND EXPRESSED THE GENUINE DIFFICULTIES OF UNABLE TO COMPLETE THE ACCOUNTS AND GET AUDITED AND TO FILE T HE RETURN OF INCOME. IN THE ASSESSMENT PROCEEDINGS IT WAS EX PLAINED THAT THE ASSESSEE IS STATUTORY BODY AND EXPANSION O F THE 4 ITA NO. 1506 & 1687/HYD/2013 ANDHRA PRADESH HOUSING BOARD, HYDERABAD. GOVERNMENT AND NOT AN INDEPENDENT COMMERCIAL ORGANI ZATION AND THE HOUSING BOARD IS CONSIDERED AS AN INDEPENDE NT ENTITY OF THE STATE GOVERNMENT AND THE INCOME FROM THE BUS INESS OPERATIONS IS NOT TAXABLE AS THE BOARD ACTS ON BEHA LF OF THE STATE GOVERNMENT THROUGH ITS PRINCIPLE AS PER ARTIC LE 289 OF THE CONSTITUTION OF INDIA. FURTHER UNDER THE PROVIS ION OF SUB SECTION 58(7) OF THE ANDHRA PRADESH HOUSING BOARD A CT THE NET REVENUE OF THE HOUSING BOARD VESTS WITH THE GOV ERNMENT AS SAME IS CONSIDERED AS INCOME EARNED BY THE STATE GOVERNMENT AND THE HOUSING BOARD IS CONSTITUTED TO PROMOTE PUBLIC SERVICES WITH NON-PROFIT MOTIVE. THE LD. A R EXPLAINED THAT THE AMOUNTS RECEIVED AND CREDITED TO THE ASSES SEE BANK ACCOUNTS ARE DEPOSITS AND INTERBANK TRANSFERS. WHE REAS LD. AO DISCUSSED ELABORATELY AT PAGE NO. 2 TO 6 AND F INALLY ISSUED SHOWCAUSE NOTICE ON 01-03-2013 AND SUMMONS U /S 131 OF THE IT ACT AS FINAL OPPORTUNITY. IN RESPONS E TO THE NOTICES ISSUED ON 18-11-2013 THE LD. AR OF THE ASS ESSEE FILED LETTERS EXPLAINING THAT THERE ARE SEVERAL ERRORS IN THE FINANCIAL STATEMENTS WHICH WOULD RESULT IN ERRONEOUS RETURN O F INCOME IF IT IS FILED. AND REQUESTED FOR SUFFICIENT TIME TO BE PROVIDED AS THEY CAN BE RECTIFIED AND FILE THE RETURN OF INC OME. WHEREAS THE LD. A.O FOUND THE CASE IS TIME BARRED F OR COMPLETION BY 31-03-2013, AND THE ASSESSEE HAS NOT UTILISED THE OPPORTUNITIES PROVIDED FROM TIME TO TIME FOR CO MPLYING THE PROVISIONS THE LD. A.O RELIED ON THE INFORMATIO N ON RECORD AND CONSIDERED THE CREDITS APPEARING IN THE BANK AC COUNTS IN THE RELEVANT FINANCIAL YEAR 2008-09 AND ALLOWED DED UCTION OF 10% OF ESTIMATED EXPENDITURE TOWARDS ADMINISTRATIVE AND MISCELLANEOUS EXPENSES THE LD. A.O ALSO CONSIDERED THE BASIS OF THE AVERAGE EXPENDITURE FOR ADMINISTRATIVE EXPENSES 5 ITA NO. 1506 & 1687/HYD/2013 ANDHRA PRADESH HOUSING BOARD, HYDERABAD. OF FINANCIAL CHARGES AND EARLIER ASSESSMENT YEAR 20 04-05 TO 2008-09 WHICH WORKED OUT TO 5.68%. THE LD. A.O AGG REGATED THE CREDITS APPEARING IN THE BANK ACCOUNTS AND ALLO WED 10% DEDUCTION TOWARDS ADMINISTRATIVE AND MISCELLANEOUS EXPENSES AND ASSESSED THE TOTAL INCOME OF RS. 1197,32,40,050 /- AND PASSED ORDER U/S 144 R.W.S OF THE 147 OF THE IT ACT DATED 28- 03-2013. 3. THE ASSESSEE AGGRIEVED BY THE ASSESSMENT ORDER F ILED AN APPEAL BEFORE THE CIT(A). IN THE APPELLATE PROCEEDI NGS THE LD. A.R OF THE ASSESSEE ARGUED AND REITERATED THE SUBMI SSIONS. WHEREAS THE LD. CIT(A) PERUSED THE GROUNDS RAISED B Y THE ASSESSEE, CATEGORICALLY DEALT ON THE GROUNDS AND DI SCUSSED ON THE BEST JUDGMENT ASSESSMENT U/S 144 OF THE IT AC T. THE LD. AR HAS RAISED THE OBJECTIONS ON THE ACTION OF THE LD. A.O WHERE THE LD. A.O WITHOUT ESTABLISHING THE NATURE O F INCOME BUT ON PRESUMPTIONS MADE THE BEST JUDGMENT ASSESSME NT. THE LD. CIT(A) CONSIDERED THE OBJECTIONS OF THE ASS ESSEE AND FINDINGS OF THE LD. A.O. AND DEALT ON SUBMISSIONS T HAT THE ASSESSEE IS AN EXTENSION OF STATE AND INCOME IS IN NOT LIABLE TO TAX IN HANDS OF THE ASSESSEE AND NO SURPLUS REMAIN S IN THE HANDS OF THE ASSESSEE AS IT IS AUTOMATICALLY BECOME S PROPERTY OF THE STATE GOVERNMENT. THE LD. CIT(A) OBSERVED A T PAGE 6 PARA 6.1 AND RELIED ON THE ORDERS OF THE COORDINATE BENCH OF THE TRIBUNAL IN THE ASSESSEESS OWN CASE IN ITA NOS . 1260 TO 1280/HYD/2012 FOR THE A.Y 2004-05, 2005-06 & 2006- 07 AT PAGE NOS. 10 TO 23 AND DISMISSED THE GROUND OF THE ASSESSEE. IN RESPECT OF THE LD. AR CONTENTION THAT THE A.O HA S ERRED IN BRINGING TO TAX IN ALL DEPOSITS IN BANK ACCOUNTS WI THOUT ESTABLISHING THAT THEY ARE IN THE NATURE OF INCOME INCLUDING 6 ITA NO. 1506 & 1687/HYD/2013 ANDHRA PRADESH HOUSING BOARD, HYDERABAD. INTERNAL BANK TRANSFERS WHICH DOES NOT PARTAKE THE CHARACTER OF INCOME. THE LD. CIT(A) DEALT AT PAGE NO. 23 PAR A 8.0 TO 8.3 WHERE THE CIT(A) HAS CONSIDERED THE TOTAL DEPOSITS IN THE SIX BANK ACCOUNTS OF THE ASSESSEE AGGREGATED THE TOTAL DEPOSIT OF RS. 1330,36,02,276/- AND OBSERVED THE TABULATION OF CASH INFLOWS AND OUTFLOWS OF THE ASSESSEE IN SBH GRUHAKA LPA BRANCH FOR THE F.Y 2008-09 AND DIRECTED THE A.O TO MAKE EXERCISE AS TABULATED IN PAGE NO. 24 IN RESPECT OF OTHER BANK ACCOUNTS MAINTAINED BY THE ASSESSEE AND TO ASCERTAI N THE CREDITS FOR CASH INFLOWS AND OUTFLOWS. THEREFORE T HE ADDITION IN RESPECT OF TOTAL CREDITS CONSIDERED IN THE ASSES SMENT ORDER IS ALTERED AND THE LD. CIT(A) HAS DIRECTED THE A.O TO VERIFY AND ASCERTAIN THE CURRENT CREDITS AND CLOSING BALANCE O F OTHER BANK ACCOUNTS MAINTAINED BY THE ASSESSEE AND PARTLY ALLOWED THE GROUND. 4. THE LD. CIT(A) BASED ON THE SUBMISSIONS OF THE A SSESSEE FOUND THAT THE A.O HAS TAXED THE BANK DEPOSITS WITH OUT ALLOWING EXPENSES INCLUDING OPERATIONAL EXPENSES. THE CIT IN THE APPELLATE PROCEEDINGS DEALT ON THIS ISSUE AT PA RA 9.0 TO 9.3 AND FOUND THAT THE A.O HAS ESTIMATED THE ANNUAL AVE RAGE EXPENDITURE FOR THE A.Y 2004-05 TO 2008-09 AT 5.68% BUT THE LD. A.O HAS ALLOWED DEDUCTION AT 10% OF THE TOTAL C REDITS TOWARDS THE ADMINISTRATION AND FINANCE CHARGES AS T HE ASSESSEE COULD NOT PRODUCE ANY SATISFACTORY EVIDENC E THAT THEY HAVE INCURRED MORE THAN 10% AND THE ASSESSEE C OULD NOT FURNISH ANY DETAILS OF EXPENDITURE WITH AUTHENTICAT E EVIDENCE AND DIRECTED THE A.O TO VERIFY THE BANK CREDITS AS DISCUSSED AT PARA ABOVE AND PARTLY ALLOWED THE APPEAL. AGGRIEVE D BY THE CIT(A) ORDER ASSESSEE HAS FILED AN APPEAL WITH THE TRIBUNAL 7 ITA NO. 1506 & 1687/HYD/2013 ANDHRA PRADESH HOUSING BOARD, HYDERABAD. BEFORE US AT THE TIME OF HEARING THE LD. AR OF THE ASSESSEE HAS ARGUED ONLY ON THE GROUND THAT THE LD. A.O ALLO WED DEDUCTION OF EXPENDITURE @ 10% TOWARDS ADMINISTRATI VE EXPENSES AND IS NOT CORRECT. WHEREAS THE LD. A.O R ELIED ONLY ON THE BANK DEPOSITS AND ALLOWED 10% OF TOTAL BANK CREDITS AS DEDUCTION WHICH IS NOT IN ACCORDANCE WITH LAW AND F URTHER THE DEPOSITS ARE IN THE NATURE OF BANK CREDITS AND INTE RNAL BANK TRANSFERS AND TREATING THE SAME AS INCOME IS NOT AC CEPTABLE. THE LD. AR FILED PAPER BOOK AND REFERRED TO THE ST ATEMENT OF COMPUTATION OF INCOME AT PAGE 14 OF PAPER BOOK WHER E THE INCOME OF HOUSING BOARD WAS DISCUSSED AND REFERRED THE FINANCIAL STATEMENTS AND ALSO CHALLENGED THE ACTION OF THE A.O IN TAXING ALL THE CREDITS APPEARING IN THE ASSESSE E BANK ACCOUNTS IN THE RELEVANT FINANCIAL YEAR AND THE LD. AR ALSO REFERRED TO THE INFORMATION FILED IN THE ASSESSMEN T PROCEEDINGS AND THE APPELLATE PROCEEDINGS WITH THE DOCUMENTARY EVIDENCE OF LEDGER ACCOUNTS AND COMPUTA TION OF TOTAL INCOME AND SUBMITTED THAT SINCE THE ASSESSMEN T WAS BEST JUDGMENT U/S 144 OF THE IT ACT, DUE TO NON AV AILABILITY OF INFORMATION ON HAND. NOW THE RECTIFIED FINANCIA L STATEMENTS ARE AVAILABLE, WHICH COULD NOT BE PRESEN TED IN THE ORIGINAL ASSESSMENT AND PRAYED FOR ONE MORE OPPORTU NITY BEFORE THE A.O TO REPRESENT THE CASE ALONG WITH DOC UMENTARY EVIDENCE. CONTRA THE LD. DR SUBMITTED THAT NO CO-O PERATION WAS EXTENDED BY THE ASSESSEE IN COMPLETION OF THE A SSESSMENT IN SPITE OF GIVING SEVERAL OPPORTUNITIES AND THE LD . A.O HAS NO OTHER ALTERNATIVE TO COMPLETE THE ASSESSMENT BEFORE 31-03- 2013 AND RELIED ON THE CREDITS IN THE BANK ACCOUNT. FURTHER THE A.O GAVE SPECIFIC FINDING AT PARA 11 OF THE ORD ER WITH 8 ITA NO. 1506 & 1687/HYD/2013 ANDHRA PRADESH HOUSING BOARD, HYDERABAD. REASONS IN ESTIMATING THE EXPENDITURE AND PASSED TH E ORDER AND THE LD. DR OPPOSED TO THE GROUNDS RAISED BY THE ASSESSEE. 5. WE HEARD THE RIVAL SUBMISSIONS AND PERUSED MATER IAL ON RECORD. THE LD. AR ARGUED ON THE ACTION OF THE A.O ON ESTIMATING THE INCOME BY ADDING TOTAL CREDITS IN TH E BANK ACCOUNTS AND ALLOWING DEDUCTION @ 10% OF THE TOTAL CREDITS TOWARDS ADMINISTRATIVE EXPENDITURE. THE LD. AR DRE W OUR ATTENTION TO THE PAPER BOOK AT PAGE NO. 16 WHERE TH E BALANCE SHEET, INCOME AND EXPENDITURE ACCOUNT OF THE ASSESS EE HAS BEEN FILED. ON PERUSAL OF THE INCOME AND EXPENDITUR E ACCOUNT, THE ASSESSEE HAS DISCLOSED THE EXCESS OF EXPENDITUR E ON INCOME AS ON 31-.03-2009. FURTHER THE ASSESSEE HAS DISCUSSED UNSECURED LOANS AT PAGE 18 WHICH WERE REC EIVED, CREDITED, AND REFLECTED IN THE BALANCE SHEET. THE LD. AR FILED JUDICIAL DECISIONS AND STATEMENT OF INFLOWS AND OUT FLOWS OF BANK ACCOUNT AT PAGE 81 TO 122 TO SUBSTANTIATE THAT THESE CREDITS ARE NOT INCOME ALONG WITH LEDGER ACCOUNT CO PIES WE FOUND. THE LD. AR ARGUMENTS ARE ON THE ALLOWABILIT Y OF ADMINISTRATIVE EXPENDITURE AT 10% OF THE TOTAL BANK CREDITS AND THE ACTION OF THE A.O IN ADDING THE TOTAL BANK CREDITS IGNORING THE INTERNAL BANK TRANSFERS AND OTHER DEPO SITS WHICH ARE NOT IN THE NATURE OF INCOME. AND THE ASSESSEE BE PROVIDED AN OPPORTUNITY TO EXPLAIN THESE FACTS ALONG WITH TH E DOCUMENTARY EVIDENCE FILED BEFORE THE TRIBUNAL WE C ONSIDERING THE APPARENT FACTS MATERIAL ON RECORD AND THE VOLUM E OF THE TRANSACTIONS AND NATURE OF WORKING OF THE ASSESSEE AND STATE GOVERNMENT THE ASSESSEE SHOULD BE PROVIDED ONE MORE OPPORTUNITY BEFORE THE A.O AS THE ORIGINAL ASSESSME NT WAS 9 ITA NO. 1506 & 1687/HYD/2013 ANDHRA PRADESH HOUSING BOARD, HYDERABAD. BEST JUDGMENT ASSESSMENT UNDER 144 OF THE IT ACT AN D THE ASSESSEE COULD NOT SUBSTANTIATE WITH THE MATERIAL I NFORMATION WHICH WAS SUBMITTED BEFORE US. ACCORDINGLY WE REMI T THE ENTIRE DISPUTED ISSUE TO THE FILE OF THE A.O TO CON SIDERED THE FINANCIAL STATEMENTS AND SCHEDULES AND VERIFY THE G ENUINENESS OF THE TRANSACTIONS. THE ASSESSEE SHALL BE PROVIDE D ADEQUATE OPPORTUNITY OF HEARING BEFORE PASSING THE ORDER. IN THE RESULT THE ASSESSEE APPEAL IS ALLOWED FOR STATISTICAL PURP OSE. ITA NO. 1687/HYD/2013 THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL. 1. THE CIT(A) OUGHT TO HAVE CALLED FOR THE REMAND R EPORT ON THE POINTS / DETAILS SUBMITTED BY THE ASSESSEE BEF ORE THE CIT(A) WHICH WERE NOT SUBMITTED BEFORE A.O DURING ASSESSMENT PROCEEDINGS AS REQUIRED U/R 46A OF IT RU LES 2. THE DECISION OF CIT(A) IS NOT ACCEPTABLE AS THE DETAILS / DOCUMENTS LIKE PAPER BOOKS, LEDGER COPIES OF BANK STATEMENTS HELD BY THE ASSESSEE WERE NOT FORWARDED TO ASSESSING OFFICER FOR EXAMINATION & FOR SUBMISSION OF REMAND REPORT. 3. AS THE CIT(A) HAD ADMITTED ADDITIONAL EVIDENCE & BASED HIS DECISION ON THE SAME WITHOUT GIVING AN OPPORTUN ITY OF BEING HEARD TO AO. 6. THE LD. DR ARGUED THAT THE CIT(A) HAS NOT CALLED FOR ANY REMAND REPORT FROM THE A.O AND THE LD. A.O WAS DEPR IVED TO EXAMINE THE GENUINENESS OF TRANSACTIONS, WHEREAS TH E LD. CIT(A) HAS ADJUDICATED THE ISSUES WITHOUT PROVIDING OPPORTUNITY TO THE A.O AND IN VIOLATION OF RULE 46A OF THE INCOME TAX RULES. THE LD. DR SUPPORTED HIS ARGUMEN TS WITH THE WRITTEN SUBMISSIONS AND JUDICIAL DECISIONS AS T HE DOCUMENTARY EVIDENCE WAS NOT AVAILABLE TO THE A.O F OR VERIFICATION AND THE A.O SHOULD BE PROVIDED AN OPPO RTUNITY TO 10 ITA NO. 1506 & 1687/HYD/2013 ANDHRA PRADESH HOUSING BOARD, HYDERABAD. VERIFY THE FACTS AND THE MATERIAL EVIDENCE FILED BE FORE THE CIT (A) AND PRAYED FOR SET ASIDE OF THE ORDERS OF THE C IT(A). CONTRA THE LD. AR EXPLAINED THAT THE A.O HAS PASSED ORDER U/S 144 OF THE IT ACT. WE HEARD THE RIVAL SUBMISSIONS PERUS ED THE MATERIAL ON RECORD. THERE IS A STRENGTH IN THE ARGU MENTS OF LD. DR ON VIOLATION OF RULE 46A OF IT RULES. AS THE A SSESSMENT WAS COMPLETED U/S 144 OF THE IT ACT AND THE ASSESSE E HAS NOT PROVIDED ANY DOCUMENTARY EVIDENCE IN ASSESSMENT BUT PRODUCED THE SAME IN THE APPELLATE PROCEEDINGS. WE ARE OF THE OPINION THAT THE A.O SHOULD BE PROVIDED AN OPPORTUN ITY TO VERIFY SUCH DOCUMENTS RELIED BY LD. CIT(A) AND WE F OUND CIT(A) HAS NOT CALLED FOR ANY REPORT / COMMENTS OF THE A.O. IN THE INTEREST OF JUSTICE WE ARE OF THE OPINION THAT THE A.O SHOULD BE PROVIDED AN OPPORTUNITY AND REMIT THE DIS PUTED ISSUE TO THE FILE OF THE A.O. SINCE THE ASSESSEE A PPEAL IS REMITTED TO THE FILE OF THE A.O FOR PRODUCTION OF A CCOUNTS. ACCORDINGLY WE FIND IT APPROPRIATE TO REMIT THE DIS PUTED IN THE REVENUES APPEAL TO THE FILE OF THE A.O. IN THE RE SULT THE REVENUE APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. 9. IN THE RESULT BOTH THE APPEALS ARE ALLOWED FOR S TATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON 24 TH FEBRUARY, 2017. SD/- SD/- (B. RAMAKOTAIAH) (G. PAVAN KUMAR ) ACCOUNTANT MEMBER JUDICIAL MEMBER HYDERABAD, DATED: 24 TH FEBRUARY, 2017 11 ITA NO. 1506 & 1687/HYD/2013 ANDHRA PRADESH HOUSING BOARD, HYDERABAD. KRK 1) AP HOUSING BOARD C/O CH. PUSHYAM KIRAN, ADVOCATE FLAT NO. D, 1 ST FLOOR, UMA ENCLAVE, RD. NO.9 BANJARA HILLS, HYDERABAD. 2) ACIT, CIRCLE 5(1) HYDERABAD 3) CIT(A)-V, HYDERABD 4) CIT-IV, HYDERABAD 5) THE DEPARTMENTAL REPRESENTATIVE, I.T.A.T., H YDERABAD. 6) GUARD FILE