Shri Dharmendrasinh R.Vaghela, Baroda V. The Addl.CIT, Range-2, Baroda

ITA 2444/AHD/2014

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 8223 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 8 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-05-2018
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2009-2010
• Appeal Filed On: 03-09-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SAURABH SINGH
• Keywords: Business expenditure; Bonafide belief; Additional evidence; Reasonable cause; Corroborative evidences; Onus to prove
• Section: 68

Judgement Text

, A IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, AHMEDABAD BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER & PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER ./ I.T.A. NO. 2444/AHD/2014 ( ASSESSMENT YEAR : 2009-10) DHARMENDRASINH R. VAGHELA PROP: NARENDRA ROADLINES, 1, GOKULNAGAR, NANDESARI, BARODA-391340 / VS. THE INCOME TAX OFFICER, WARD-2(1), BARODA - 390007 ./ ./ PAN/GIR NO. : AAHPV2633D ( APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY : SHRI MUKUND BAKSHI, A.R. / RESPONDENT BY : SHRI SAURABH SINGH, SR. D.R. DATE OF HEARING 16/05/2018 !'# / DATE OF PRONOUNCEMENT 31/ 05/2018 / O R D E R PER PRADIP KUMAR KEDIA - AM: THE CAPTIONED APPEAL HAS BEEN FILED AT THE INSTANCE OF THE ASSESSEE AGAINST THE ORDER OF THE CIT(A)-II, BARODA (CIT(A) IN SHORT), DATED 24.04.2014 ARISING IN THE ASSESSMENT ORDER DATED 30.12.2011 PASSED BY THE ASSESSING OFFICER (AO) U/S .143(3) OF THE ITA NO. 2444/AHD/14 [DHARMENDRASINH R. VAGHELA VS. ITO] A.Y. 2009-10 - 2 - INCOME TAX ACT, 1961; (THE ACT) CONCERNING ASSESSME NT YEAR 2009- 10. 2. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE IS REPRODUCED HEREUNDER: 1. (A) THE LD. CIT(A)-II, BARODA HAS ERRED IN L AW AND IN FACTS IN NOT ADMITTING THE ADDITIONAL EVIDENCES AND EXPLANATION IN RELATION TO THE LOAN OF RS. 20,00,00 0/- OBTAINED FROM SHRI VIJAYSINH SISODIYA AND SHRI MAHENDRASINH SISODIYA. (B) THE LD. CIT(A)-II, BARODA HAS FURTHER ERRED IN LAW AND IN FACTS IN CONFIRMING THE ADDITION OF RS. 20,00,00 0/- RECEIVED AS LOAN FROM THE PERSONS ABOVE NAMED, TREA TING THE SAME AS UNEXPLAINED. 2. (A) THE LD. CIT(A)-II, BARODA HAS ERRED IN L AW AND IN FACTS IN NOT ADMITTING THE ADDITIONAL EVIDENCES AND EXPLANATION IN RELATION TO THE CLAIM OF INTEREST EX PENSES OF RS. 14,29,790/- EXPLAINED TO HAVE BEEN INCURRED ON THE BORROWING UTILIZED FOR PURCHASE OF LAND FOR TRA DING PURPOSES. (B) THE LD. CIT(A)-II, BARODA HAS FURTHER ERRED IN LAW AND IN FACTS IN CONFIRMING THE DISALLOWANCE OF EXPENSE OF RS. 14,29,790/- INCURRED AS INTEREST ON BORROWINGS MADE AND UTILIZED FOR PURCHASE OF LAND FOR TRADING PURPOSES. 3. (A) THE LD. CIT(A)-II, BARODA OUGHT TO HAVE ACCEPTED THE OF THE APPELLANT THAT THE PROVISIONS OF SEC. 40(A)(IA) COULD BE INVOKED ONLY IN A CASE WHERE THE PAYMENT LIABLE TO DEDUCTION OF TAX AT SOURCE REMAINED PAYABLE AND NOT IN ITA NO. 2444/AHD/14 [DHARMENDRASINH R. VAGHELA VS. ITO] A.Y. 2009-10 - 3 - RESPECT OF THE PAYMENTS WHERE THE AMOUNT HAS ALREAD Y PAID. (B) THE LD. CIT(A)-II, BARODA HAS ERRED IN LAW AN D IN FACTS IN NOT ACCEPTING THE ABOVE CONTENTION IN RESPECT OF TH E DISALLOWANCE OF EXPENDITURE OF RS. 14,11,839/-INCUR RED AND PAID TO NBFC AS INTEREST. 4. THE LD. CIT(A)-II, BARODA HAS ERRED IN LAW AND I N FACTS IN CONFIRMING THE DISALLOWANCE OF AN AMOUNT OF RS.1,09 ,000/- PAID TO MARUTI TYRES FOR RETREADING OF TYRES BY INV OKING THE PROVISIONS OF SEC. 40(A)(IA). 3. IN THE COURSE OF HEARING, THE LEARNED AR FOR THE ASSESSEE FAIRLY STATED ON BEHALF OF THE ASSESSEE THAT HE DOES NOT S EEK TO PRESS GROUND NOS. 3 & 4 OF THE ASSESSEES APPEAL CONCERNI NG DISALLOWANCE U/S.40(A)(IA). THEREFORE, GROUND NOS. 3 & 4 ARE DIS MISSED AS NOT PRESSED. 4. WE SHALL NOW ADVERT TO GROUND NO.1 OF THE ASSESS EES APPEAL CONCERNING ADDITION OF RS.20 LAKH TOWARDS UNEXPLAIN ED CREDIT UNDER S.68 OF THE ACT. 4.1 BRIEFLY STATED, IT WAS OBSERVED BY THE AO IN TH E COURSE OF ASSESSMENT PROCEEDINGS U/S.143(2) OF THE ACT THAT T HE ASSESSEE HAS STATEDLY OBTAINED LOANS FROM ONE SHRI ASHWINI SINGH . THEREAFTER, THE FURTHER LOAN OF RS.10 LAKHS WAS CLAIMED TO BE R AISED FROM THE ABOVE NAMED PERSON RESULTING IN AGGREGATE LOAN AMOU NT OF RS.20 LAKHS. THE AO OBSERVED THAT THE ASSESSEE HAS FAILE D TO FURNISH THE CONFIRMATION, THE ADDRESS, IDENTIFICATION, BANK/PAN DETAILS AND CREDITWORTHINESS ARE OF THE AFORESAID CREDITOR. IT WAS FURTHER ITA NO. 2444/AHD/14 [DHARMENDRASINH R. VAGHELA VS. ITO] A.Y. 2009-10 - 4 - OBSERVED BY THE AO THAT NOT A SINGLE REQUIREMENT WA S FULFILLED BY THE ASSESSEE. THE AO THUS, ON ACCOUNT OF FAILURE O F THE ASSESSEE TO DISCHARGE THE ONUS WHICH LAY UPON HIM, INVOKED SECT ION 68 OF THE ACT AND ADDED RS.20 LAKHS TO THE TOTAL INCOME OF AS SESSEE. 4.2 AGGRIEVED, THE ASSESSEE PREFERRED THE APPEAL BE FORE THE CIT(A). 4.3 BEFORE THE CIT(A), THE ASSESSEE CHANGED THE STA ND TOWARDS SOURCE OF LOAN ALTOGETHER AND SUBMITTED THAT RS.10 LAKHS WAS RECEIVED FROM VIJAYSINH SISODIYA AND ANOTHER RS.10 LAKHS WAS RECEIVED FROM MAHENDRASINH SISODIYA. THE ASSESSEE CONTENDED THAT SHRI ASHWINI SINGH WAS MERELY A FACILITATOR FOR PRO CUREMENT OF LOAN FROM THESE TWO PARTIES. THE ASSESSEE ACCORDINGLY S OUGHT TO FILE ADDITIONAL EVIDENCES TO SUPPORT THE CHANGED STAND B EFORE THE CIT(A). THE CIT(A) DECLINED TO ADMIT THE ADDITIONA L EVIDENCES ON THE GROUND THAT THE ASSESSEE WAS GIVEN AMPLE OPPORT UNITIES TO FURNISH THE BASIC DOCUMENTS TO SATISFY THE AO TOWAR DS THE GENUINENESS AND CREDITWORTHINESS OF THE LOAN. THE ASSESSEE HAS TOTALLY FAILED BEFORE THE AO TO DO SO. THE CIT(A) FURTHER NOTED THAT EVEN BANK STATEMENTS OF THESE TWO PERSONS HAVE NOT BEEN FURNISHED. THE CIT(A) FOUND THAT THE WHOLE EXPLANATION OF THE ASSESSEE IS UNSUPPORTED AND ONLY AN AFTERTHOUGHT. THE CIT(A) AC CORDINGLY DECLINED TO GRANT ANY RELIEF TO THE ASSESSEE ON THE AFORESAID ADDITION. 4.4 THE RELEVANT OPERATIVE PARA OF THE ORDER OF THE CIT(A) IS EXTRACTED HEREUNDER: 3.3. I HAVE CONSIDERED THE SUBMISSIONS OF THE LEAR NED AUTHORIZED REPRESENTATIVE AND THE ORDER OF THE ASSESSING OFFIC ER. FROM THE ASSESSMENT ORDER, IT CLEARLY TRANSPIRES THAT THE AS SESSING OFFICER HAD ITA NO. 2444/AHD/14 [DHARMENDRASINH R. VAGHELA VS. ITO] A.Y. 2009-10 - 5 - GIVEN AMPLE OPPORTUNITIES TO THE APPELLANT TO FURNI SH THE CONFIRMATION, ADDRESS, IDENTIFICATION, BANK/PAN DET AILS AND ALSO REQUESTED TO PROVE CREDITWORTHINESS OF THE DEPOSITO R. TO PROVE THE GENUINENESS OF THE UNSECURED LOANS, NOT A SINGLE RE QUIREMENT WAS FULFILLED BY THE ASSESSEE. THE ASSESSING OFFICER CO NTENDED THAT IT IS WELL SETTLED LAW THAT BURDEN OF PROOF LIES ON THE S HOULDER OF THE ASSESSEE AND IF THE ASSESSEE FAILED TO FILE IDENTIF Y AND PROVE THE CREDITWORTHINESS OF THE DEPOSITOR, THE AMOUNT OF UN SECURED LOANS WAS TO BE CONSIDERED AS INCOME OF THE ASSESSEE FROM UNE XPLAINED SOURCES. NOW BEFORE ME ALSO THE APPELLANT HAS CONTENDED THAT IN FACT, THE LENDER HAS ALSO RAISED MONEY FROM TWO VILLAGERS NAM ELY SISODIYA VIJAYSINH AMARSANG AND SISODIYA MAHENDRASINH NATHUB HA AND HAS FILED DOCUMENTS IN RESPECT OF THEIR IDENTITY AND LA ND HOLDING TO PROVE THEIR CREDITWORTHINESS. HOWEVER, THE BANK STATEMENT S OF THESE TWO PERSONS ARE NOT FURNISHED AND APPARENTLY, THE CASH OF RS.10,00,000/- WAS PAID BY EACH OF THEM TO SHRI ASHWINI SINGH WHO ALLEGEDLY PAID THIS AMOUNT TO THE APPELLANT. AS MENTIONED ABOVE, D URING THE ASSESSMENT PROCEEDINGS, THE APPELLANT HAS NOT FILED ANY DOCUMENT BEFORE THE ASSESSING OFFICER TO PROVE THE CREDITWOR THINESS OF SHRI ASHWINI SINGH AND NOW HE IS TRYING TO FILE DOCUMENT S RELATING TO THE CREDITWORTHINESS OF TWO NEW PERSONS NAMELY SISODIYA VIJAYSINH AMARSANG AND SISODIYA MAHENDRASINH NATHUBHA WHOSE N AMES NEVER FIGURED ANYWHERE DURING ASSESSMENT PROCEEDINGS. MOR EOVER, THE BANK STATEMENTS OF THESE PERSONS ARE NOT FURNISHED WHICH INDICATE THAT ALL THESE EXPLANATIONS ARE ONLY AFTERTHOUGHT. THE APPELLANT HAS CONTENDED THAT THESE DOCUMENTS (RELATING TO THE IDE NTITY & CREDITWORTHINESS OF TWO NEW PERSONS NAMELY SISODIYA VIJAYSINH AMARSANG AND SISODIYA MAHENDRASINH NATHUBHA) WERE N OT SUBMITTED BEFORE THE LD. ASSESSING OFFICER AS THE APPELLANT, UNDER BONAFIDE BELIEF, WAS PURSUING WITH SHRI ASHWINI SINGH AND ON LY AT A LATER POINT OF TIME, IT WAS REALIZED THAT THE AMOUNT, THO UGH PROCURED THROUGH HIS REFERENCE, IS ACTUALLY FROM D IFFERENT PERSONS, THE PARTICULARS OF WHICH IS AS FURNISHED ABOVE. THI S STATEMENT IS TOTALLY VAGUE AND DEVOID OF ANY MERIT. THE APPELLAN T WANTS TO PRODUCE THE ADDITIONAL EVIDENCES REFERRED ABOVE UND ER RULE 46A OF THE I.T. RULES ON THE GROUND THAT AT THE TIME OF AS SESSMENT, THE APPELLANT WAS PREVENTED BY SUFFICIENT CAUSE FOR BEI NG UNABLE TO DO SO. WHAT ARE THOSE CAUSES AND HOW THE APPELLANT WAS PREVENTED IN COOPERATING WITH THE ASSESSING OFFICER TO FURNISH T HE CONFIRMATION, ADDRESS, IDENTIFICATION, BANK/PAN DETAILS AND TO PR OVE CREDITWORTHINESS OF SHRI ASHWINI SINGH IS NOT CLEAR . UNDER THESE CIRCUMSTANCES, THE ADDITIONAL EVIDENCES REFERRED AB OVE AND BEING FILED BY THE APPELLANT IN VIOLATION OF PROVISIONS O F RULE 46A OF THE I.T. RULES, CANNOT BE ACCEPTED. 3.4. AFTER CONSIDERING THE SUBMISSIONS OF THE LEARN ED AUTHORIZED REPRESENTATIVE AND THE ORDER OF THE ASSESSING OFFIC ER, IT IS HELD THAT APPELLANT HAS HEAVILY RELIED ON THE ADDITIONAL EVID ENCE WHICH IS FILED BEFORE ME WITHOUT ANY APPLICATION FOR ADMITTING THE SAME AND ITA NO. 2444/AHD/14 [DHARMENDRASINH R. VAGHELA VS. ITO] A.Y. 2009-10 - 6 - WITHOUT CITING ANY REASONABLE CAUSE THAT PREVENTED HIM TO PRODUCE SUCH EVIDENCE BEFORE THE ASSESSING OFFICER DURING T HE ASSESSMENT PROCEEDINGS. ALLAHABAD HIGH COURT IN THE CASE OF RAM PRASAD SHARMA VS CIT [1979] 119 ITR 867 (ALL.) HAS HELD THAT THE PRODUCTION OF ADDITIONAL EVIDENCE EITHER BEFORE THE FIRST APPELLATE AUTHORITY OR THE TRIBUNAL WAS NOT AS A MATTER OF RI GHT AND IN CASE A DISCRETION WAS EXERCISED IN ACCORDANCE WITH LAW THE RE WAS NO OCCASION TO INTERFERE. SIMILAR VIEW HAS BEEN TAKEN BY RAJASTHAN HIGH COURT IN THE CASE OF CIT VS RAO RAJA HANUT SINGH [2001] 252 ITR 528 (RAJ.) . HON'BLE GUJARAT HIGH COURT HAS ALSO AFFIRMED THE SE DECISIONS IN THE CASE OF FAIRDEAL FILAMENTS LTD. VS CIT [2008] 302 ITR 173 (GUJ.) . AFTER CONSIDERING THE FACTS OF THE CASE AND THE SUBMISSIONS OF THE AR WHICH ARE NOT BASED ON PLAUSI BLE EXPLANATION, THE ADDITIONAL EVIDENCES BEING FILED ARE NOT ADMITT ED AS THE SAME ARE IN CLEAR VIOLATION OF RULE 46A. CONSIDERING THE FAC T THAT THE APPELLANT HAS NEVER BEEN ABLE TO SATISFACTORILY EXP LAIN THE SOURCE OF RS.20,00,000/- ALLEGEDLY RECEIVED FROM SHRI ASHW INI SINGH WITH PROOF OR CONFIRMATION AND ADDRESS, IDENTIFICATION, BANK/PAN DETAILS TO PROVE CREDITWORTHINESS OF SHRI ASHWINI SINGH, TH E ACTION OF THE AO IN MAKING ADDITION UNDER SECTION 68 OF THE ACT IS F ULLY JUSTIFIED AND THE SAME IS CONFIRMED. THIS GROUND OF APPEAL IS DIS MISSED. 4.5 FURTHER AGGRIEVED, THE ASSESSEE PREFERRED APPEA L BEFORE THE TRIBUNAL. 4.6 LEARNED AR FOR THE ASSESSEE MR. MUKUND BAKSHI R EQUESTED FOR A DIRECTION TO THE CIT(A) FOR ADMISSION OF ADDITION AL EVIDENCES AT THE OUTSET. THE LEARNED AR SUBMITTED THAT WHILE TH E ASSESSEE WAS NOT HOLDING THE KEY PARTICULARS TOWARDS SOURCE OF L OAN, THE SAME WERE OBTAINED POST ASSESSMENT AND FILED BY WAY OF A DDITIONAL EVIDENCES BEFORE THE CIT(A) IN TERMS OF RULE 46A. T HE LEARNED AR SUBMITTED THAT THE CIT(A) WAS DUTY BOUND TO ADMIT T HE ADDITIONAL EVIDENCES IN TERMS OF RULE 46A OF THE INCOME TAX RU LES, 1962 AND WAS OBLIGED TO DETERMINE THE ISSUE ON MERITS. 4.7. LEARNED DR, ON THE OTHER HAND, RELIED UPON THE ORDER OF AO AND CIT(A) AND CONTENDED THAT THE ASSESSEE OUGHT TO HAVE COME OUT WITH THE CORRECT PICTURE ON FACTS AT THE THRESHOLD BEFORE THE ITA NO. 2444/AHD/14 [DHARMENDRASINH R. VAGHELA VS. ITO] A.Y. 2009-10 - 7 - ASSESSING OFFICER. LEARNED DR CONTENDED THAT THE C IT(A) HAS RIGHTLY REJECTED THE PLEA TOWARDS ADMISSION OF ADDI TIONAL EVIDENCES AT BELATED STAGE IN THE ABSENCE OF ANY DEMONSTRABLY REASONABLE GROUND. 5. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIO NS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE ASSE SSEE HAS IMPUGNED THE ORDER OF THE CIT(A) FOR CONFIRMING THE ACTION OF THE AO TOWARDS ADDITION OF RS.20 LAKHS UNDER S.68 WITHO UT RECOGNIZING THE ADDITIONAL EVIDENCES IN THIS REGARD. AS NOTED BY THE CIT(A), THE ASSESSEE HAS MODIFIED ITS STAND BEFORE THE CIT(A) T HAT LOANS WERE TAKEN FROM VIJAYSINH SISODIYA AND MAHENDRASINH SISO DIYA INSTEAD OF SHRI ASHIWNI SINGH WRONGLY INFORMED TO THE AO. IT IS THE CASE OF THE ASSESSEE THAT THE LOAN CONFIRMATION AND OTHER D OCUMENTARY EVIDENCES FILED AS ADDITIONAL EVIDENCE BEFORE THE C IT(A) OUGHT TO HAVE BEEN ADMITTED IN TERMS OF RULE 46A OF THE INCO ME TAX RULES, 1962 IN THE INTEREST OF JUSTICE AND MATTER OUGHT TO HAVE BEEN DECIDED ON MERITS. IT IS THUS INSISTED ON BEHALF OF THE AS SESSEE THAT THE ISSUE IS REQUIRED TO BE REMANDED BACK TO THE LOWER AUTHOR ITIES FOR ITS EXAMINATION ON MERITS IN THE LIGHT OF ADDITIONAL EV IDENCES. A PERUSAL OF THE ORDER OF THE CIT(A) REPRODUCED ABOVE CLEARLY SHOWS THAT THE CIT(A) HAS OBSERVED THAT AMPLE OPPORTUNITI ES WERE GIVEN TO THE ASSESSEE TO SUPPORT THE CREDITS APPEARING IN TH E BOOKS OF ACCOUNTS. THE ASSESSEE HAS TOTALLY FAILED IN THIS REGARD BEFORE THE AO. CLEARLY, THE ENTIRE PROCESS OF INQUIRY WAS SCUT TLED BEFORE THE AO. BEFORE THE CIT(A), THE ASSESSEE CAME OUT WITH AN ALTOGETHER NEW VERSION THAT THE LOANS WERE RECEIVED FROM DIFFE RENT PARTIES AND NOT FROM THE PERSON NAMED BEFORE THE AO. THE ASSESS EE HAS FAILED TO SUBSTANTIATE THE REASONS FOR DIVERGENT STAND. THE B ANK STATEMENTS OF ITA NO. 2444/AHD/14 [DHARMENDRASINH R. VAGHELA VS. ITO] A.Y. 2009-10 - 8 - THE LENDERS WERE ALSO NOT FURNISHED. NEEDLESS TO S AY, THE BENEFIT OF RULE 46A FOR ADMISSION OF ADDITIONAL EVIDENCES CAN BE GRANTED TO AN ASSESSEE ONLY WHEN ONE OF THE FOUR CONDITIONS SPECI FIED IN RULE 46A IS SATISFIED. THE ASSESSEE HAS NOT SHOWN AS TO WHA T PREVENTED HIM FOR FILING THE EVIDENCE BEFORE THE AO WHICH IS NOW SOUGHT TO BE INTRODUCED BEFORE THE CIT(A). IT IS ALSO NOT A CAS E WHERE THE OPPORTUNITY WAS NOT GIVEN TO THE ASSESSEE FOR DOING SO. THE ADMISSION OF ADDITIONAL EVIDENCES BEFORE THE LOWER AUTHORITIES IS NOT A MATTER OF RIGHT BUT IS DEPENDENT UPON THE EXERCIS E OF DISCRETION OF THE CIT(A) HAVING REGARD TO THE FACTS AND CIRCUMSTA NCES OF THE CASE. WE ARE UNABLE TO SEE THAT THE CIT(A) HAS ACTED ARBI TRARILY WHILE DENYING THE ADMISSION OF ADDITIONAL EVIDENCES. ON THE CONTRARY, THE ASSESSEE HAS NOT COME WITH CLEAN HANDS BEFORE THE A O. BEFORE THE CIT(A) TOO, THE INFORMATION PLACED WERE HALF BAKED WITHOUT THE BANK STATEMENT OF THE CREDITOR OR THEIR BALANCE SHE ET. WE DO NOT SEE ANY COMPELLING REASON FOR THE CIT(A) TO ADMIT THE A DDITIONAL EVIDENCE AT THE WHIMS OF THE ASSESSEE. IN THE ABSE NCE OF ANY PROPER JUSTIFICATION FOR CHANGE IN STAND AND FOR NON PRODU CTION OF SUPPORTING EVIDENCE BEFORE THE AO, THE ACTION OF TH E CIT(A) CANNOT BE FAULTED. WE THUS ENDORSE THE ACTION OF THE CIT( A) AND DECLINE THE INTERFERE. 6. IN THE RESULT, GROUND NO.1 OF THE ASSESSEES APP EAL IS DISMISSED. 7. GROUND NO.2 CONCERNS DISALLOWANCE OF INTEREST EX PENSES OF RS.14,29,790/- WHICH IS CLAIMED BY THE ASSESSEE AS BUSINESS EXPENDITURE RELATABLE TO PURCHASE OF LAND FOR TRADI NG PURPOSES. ITA NO. 2444/AHD/14 [DHARMENDRASINH R. VAGHELA VS. ITO] A.Y. 2009-10 - 9 - 7.1 IN THIS REGARD, THE ASSESSEE BEFORE THE AO SUBM ITTED THAT NOTWITHSTANDING THE FACT THAT THE AFORESAID INTERES T AMOUNT WAS CLAIMED AS BUSINESS EXPENSES AGAINST THE ROAD LINE BUSINESS, THE BORROWED FUND WERE UTILIZED FOR PURCHASE OF LAND AC QUIRED FOR TRADING PURPOSES. THE ASSESSEE ACCORDINGLY JUSTIFI ED HIS CLAIM OF EXPENDITURE FROM REVENUE OPERATIONS. THE AO DID NO T FIND ANY MERIT IN THE AFORESAID PLEA. THE AO OBSERVED THAT THE ASSESSEE IS NOT FOUND TO BE ENGAGED IN ANY LAND TRADING BUSINES S PER SE. THE ASSESSEE HAS NOT SUPPORTED ITS PLEA ON FACTS IN ANY MANNER. EVEN THE BALANCE SHEET OF THE ASSESSEE WAS NOT FILED. THE A O FURTHER OBSERVED THAT ASSESSEE HAS FAILED TO PROVE ANY NEXU S BETWEEN THE BORROWED FUNDS AND PURCHASE OF LAND. ON THESE BROA DER FACTS, THE AO DECLINED TO ACCEPT THE CLAIM OF INTEREST EXPENDI TURE IS ALLOWABLE EXPENDITURE. 7.2 AGGRIEVED, THE ASSESSEE PREFERRED THE APPEAL BE FORE THE CIT(A). 7.3 BEFORE THE CIT(A), THE ASSESSEE ONCE AGAIN SOUG HT ADMISSION OF CERTAIN ADDITIONAL EVIDENCES TO SUPPORT ITS CLAI M TOWARDS INTEREST EXPENSES. THE CIT(A) DECLINED TO ADMIT THE ADDITIO NAL EVIDENCES ON THE GROUND THAT NEITHER ANY APPLICATION WAS MOVED F OR ADMITTING THE SAME NOR WAS IT SHOWN THAT REASONABLE OPPORTUNITY W AS NOT PROVIDED TO THE ASSESSEE FOR PRODUCTION OF SUCH ADDITIONAL E VIDENCES. THE CIT(A) THUS CONCLUDED THAT IN THE ABSENCE OF ANY LA ND TRADING BUSINESS SHOWN BY THE ASSESSEE AND IN THE ABSENCE O F ANY NEXUS ESTABLISHED BEFORE THE AO TOWARDS BORROWED FUNDS UT ILIZED FOR BUSINESS PURPOSES THE EXPENSES ARE NOT ALLOWABLE. THE CIT(A) THUS DECLINED TO INTERFERE WITH THE ACTION OF THE AO. ITA NO. 2444/AHD/14 [DHARMENDRASINH R. VAGHELA VS. ITO] A.Y. 2009-10 - 10 - 7.4 THE RELEVANT OPERATIVE PARA OF THE ORDER OF THE CIT(A) IS REPRODUCED HEREUNDER: 4.3. 1 HAVE CONSIDERED THE SUBMISSIONS OF THE LEAR NED AUTHORIZED REPRESENTATIVE AND THE ORDER OF THE ASSESSING OFFIC ER. THE APPELLANT HAS CONTENDED THAT THESE DOCUMENTS RELATING TO THE TRADING IN LAND WERE NOT SUBMITTED BEFORE THE LD. ASSESSING OFFICER AS THE APPELLANT WAS NOT PROVIDED WITH SUFFICIENT OPPORTUNITY DURING THE ASSESSMENT PROCEEDINGS. THE APPELLANT WANTS TO PRODUCE THE ADD ITIONAL EVIDENCES REFERRED ABOVE UNDER RULE 46A OF THE I.T. RULES ON THE GROUND THAT AT THE TIME OF ASSESSMENT, THE APPELLAN T WAS PREVENTED BY SUFFICIENT CAUSE FOR BEING UNABLE TO DO SO. WHAT AR E THOSE CAUSES AND HOW THE APPELLANT WAS PREVENTED IN COOPERATING WITH THE ASSESSING OFFICER TO FURNISH THE DETAILS OF TRANSACTIONS ALRE ADY AVAILABLE WITH HIM IS NOT CLEAR. FROM THE ASSESSMENT ORDER, IT IS CLEAR THAT SUFFICIENT OPPORTUNITY WAS GRANTED BY THE ASSESSING OFFICER TO THE APPELLANT AND HE ALSO ISSUED SHOW-CAUSE NOTICE FOR FILING OF DETAILS OF INTEREST EXPENSES. UNDER THESE CIRCUMSTANCES, THE ADDITIONAL EVIDENCES REFERRED ABOVE AND BEING FILED BY THE APPELLANT IN VIOLATION OF PROVISIONS OF RULE 46A OF THE I.T. RULES, CANNOT BE ACCEPTED. 4.4. AFTER CONSIDERING THE SUBMISSIONS OF THE LEARN ED AUTHORIZED REPRESENTATIVE AND THE ORDER OF THE ASSESSING OFFIC ER; IT IS HELD THAT APPELLANT HAS HEAVILY RELIED ON THE ADDITIONAL EVID ENCE WHICH IS FILED BEFORE ME WITHOUT ANY APPLICATION FOR ADMITTING THE SAME AND WITHOUT CITING ANY REASONABLE CAUSE THAT PREVENTED HIM TO PRODUCE SUCH EVIDENCE BEFORE THE ASSESSING OFFICER DURING T HE ASSESSMENT PROCEEDINGS. ALLAHABAD HIGH COURT IN THE CASE OF RAM PRASAD SHARMA VS C1T [1979] 119 ITR 867 (ALL.) HAS HELD THAT THE PRODUCTION OF ADDITIONAL EVIDENCE EITHER BEFORE THE FIRST APPELLATE AUTHORITY OR THE TRIBUNAL WAS NOT AS A MATTER OF RI GHT AND IN CASE A DISCRETION WAS EXERCISED IN ACCORDANCE WITH LAW THE RE WAS NO OCCASION TO INTERFERE, SIMILAR VIEW HAS BEEN TAKEN BY RAJASTHAN HIGH COURT IN THE CASE OF CIT VS RAO RAJA HANUT SINGH [2001] 252 ITR 528 (RAJ.). HON'BLE GUJARAT HIGH COURT HAS ALSO AFFIRMED THESE DECISIONS IN THE CASE OF FAIRDEAL FILAMENTS LTD. VS CIT [2008] 302 ITR 173 (GUJ.). AFTER CONSIDERING THE FACTS OF THE CASE AND THE SUBMISSIONS OF THE AR WHICH ARE NOT BASED ON PLAUSI BLE EXPLANATION, THE ADDITIONAL EVIDENCES BEING FILED ARE NOT ADMITT ED AS THE SAME ARE IN CLEAR VIOLATION OF RULE 46A. CONSIDERING THE FAC T THAT THE APPELLANT HAS NEVER BEEN ABLE TO SATISFACTORILY EXP LAIN THE JUSTIFICATION OF EXPENDITURE OF RS.14,29,790/- CLAI MED AS INTEREST EXPENSES PAID TO DENA BANK, THE ASSESSEE ONLY EXPLA INED THAT THIS AMOUNT THOUGH CLAIMED AS INTEREST AGAINST THE ROAD LINES BUSINESS, THE FUND HAS BEEN UTILIZED FOR PURPOSE OF LAND PURC HASE AND HENCE THE SAME MAY BE ALLOWED AS EXPENSE, AGAINST THE LAN D TRADING BUSINESS. THE CONTENTION OF THE ASSESSEE WAS NOT AC CEPTED BY THE ITA NO. 2444/AHD/14 [DHARMENDRASINH R. VAGHELA VS. ITO] A.Y. 2009-10 - 11 - ASSESSING OFFICER AS NO LAND TRADING BUSINESS OF TH E ASSESSEE WAS SHOWN. IN FACT THE ASSESSEE HAS NOT EVEN SHOWN ANY LAND IN THE BALANCE SHEET AND THE INFORMATION OF PURCHASE OF TW O PIECES OF LAND WAS GATHERED FROM AIR DETAILS. THUS, THE IT IS HELD THAT THE ASSESSING OFFICER HAS CORRECTLY OBSERVED THAT THE ASSESSEE HA S FAILED TO PROVE NEXUS BETWEEN PURCHASE/TRADING OF LAND AND CLAIM OF INTEREST EXPENSES OF RS.14,29,790/-. THE ACTION OF THE ASSES SING OFFICER IN MAKING ADDITION OF THIS AMOUNT IS FULLY JUSTIFIED A ND THE SAME IS CONFIRMED. THIS GROUND OF APPEAL IS ALSO DISMISSED. 7.5 FURTHER AGGRIEVED, THE ASSESSEE PREFERRED APPEA L BEFORE THE TRIBUNAL. 7.6 THE LEARNED AR FOR THE ASSESSEE AT THE OUTSET R EQUESTED FOR A DIRECTION FROM THE BENCH TO THE LOWER AUTHORITIES F OR ADMISSION OF ADDITIONAL EVIDENCES TO ADJUDICATE THE ISSUE. HOWE VER, ON INQUIRY FROM THE BENCH, THE LEARNED AR DREW BLANK ON THE RE ASONS WHICH PREVENTED THE ASSESSEE FROM FURNISHING SUCH EVIDENC ES BEFORE THE ASSESSING OFFICER. 7.7 THE LEARNED DR, ON THE OTHER HAND, SUBMITTED TH AT THE ACTION OF THE CIT(A) IS WELL REASONED AND DOES NOT CALL FO R ANY INTERFERENCE. THE LEARNED DR CONTENDED THAT THE AD MISSION OF ADDITIONAL EVIDENCES CANNOT BE MADE IN A LIGHT HEAR TED MANNER TO ACCOMMODATE A DEFAULTING ASSESSEE BEFORE THE AO. T HE ASSESSEE IS DUTY BOUND TO SHOW REASONS FOR NON-COMPLIANCE BEFOR E THE AO. 8. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIO NS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. A PERUSA L OF THE ORDER OF THE CIT(A) SHOWS THAT THE ASSESSEE HAS FAILED TO SH OW LACK OF OPPORTUNITIES MADE AVAILABLE TO SUPPORT ITS CLAIM O F BUSINESS EXPENDITURE ON ACCOUNT OF INTEREST. THE ASSESSEE H AS FURTHER FAILED TO SHOW THE REASONS WHICH PREVENTED HIM FROM FURNIS HING EVIDENCES ITA NO. 2444/AHD/14 [DHARMENDRASINH R. VAGHELA VS. ITO] A.Y. 2009-10 - 12 - RELEVANT TO ITS CLAIM AT THE INITIAL STAGE. A READ ING OF THE ORDER OF THE CIT(A) REPRODUCED ABOVE SHOWS THAT THE ACTION O F CIT(A) IS NOT ARBITRARY. THUS, IN THE ABSENCE OF ANY IRREGULARIT Y IN EXERCISE OF DISCRETION VESTED WITH THE CIT(A), WE DO NOT SEE AN Y GOOD REASON TO INTERFERE THEREOF. WE THUS ENDORSE THE ACTION OF T HE CIT(A) IN TOTO WITHOUT FURTHER DELIBERATION THEREON. 9. IN THE RESULT, GROUND NO.2 OF THE ASSESSEES APP EAL IS DISMISSED. 10. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DI SMISSED. SD/- SD/- (RAJPAL YADAV) (PRADIP K UMAR KEDIA) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD: DATED 31/05/2018 TRUE COPY S. K. SINHA !'#' / COPY OF ORDER FORWARDED TO:- &. / REVENUE 2. / ASSESSEE (. )*+ , / CONCERNED CIT 4. ,- / CIT (A) /. 012 33*+4 *+#4 56) / DR, ITAT, AHMEDABAD 7. 289 : / GUARD FILE. BY ORDER / 4 /5 *+#4 56) THIS ORDER PRONOUNCED IN OPEN COURT ON 31/05/201 8