Euro Asia Mercantile Pvt. Ltd., New Delhi V. DCIT- CC-23, New Delhi

ITA 271/DEL/2022

AI Insights

The case involves Euro Asia Mercantile Pvt. Ltd, the appellant, contesting an order from the CIT(A)-30, which confirmed an addition of Rs. 1,40,56,000 under section 68 of the Income Tax Act, 1961. The appellant argued that the CIT(A) erred in law and facts by not admitting additional evidences that were crucial for the case. The Tribunal noted that the assessee was not given a proper opportunity to present their case at the assessment stage, leading to a violation of natural justice. The CIT Department, represented by Ms. Maimum Alam, did not object to the matter being restored for de novo adjudication.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 131164 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 2 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-04-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 26-04-2023
• Assessment Year: 2009-2010
• Appeal Filed On: 06-02-2022
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Additional evidence
• Section: 68

Judgement Text

Page | 1 INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “B”: NEW DELHI BEFORE Shri C.M. Garg, Judicial Member AND Shri M. Balaganesh, Accountant Member ITA No. 271/Del/2022 (Assessment Year: 2009-10) Euro Asia Mercantile Pvt. Ltd, 1014, Naurang Bhawan, 21 K. H. Marg, Cannuaght Place, New Delhi-110001 Vs. DCIT, Central Circle-23, New Delhi (Appellant) (Respondent) PAN: AABCE7522P Assessee by : Sh. Anuj Jain, CA Revenue by: Ms. Maimum Alam, Sr. DR Date of Hearing 27/04/2023 Date of pronouncement 27/04/2023 O R D E R PER C. M. GARG, J. M.: 1. This appeal has been preferred by the assessee against the order of the ld. CIT(A)-30, New Delhi dated 28.09.2015 for AY 2009- 10. 2. The assessee has raised the following grounds of appeal:- “1. The order passed by CIT (A) - 30 is bad in law and void ab-initio. 2. That on the facts & circumstances of the case the Ld. CIT(A)-30 has erred in law and facts by confirming the addition made by the Ld. A.O. of Rs. 1,40,56,000/- u/s 68 of the Income Tax Act, 1961 & while not admitting the additional evidences submitted by the appellant. 3. That on the facts and circumstances of the case the Ld. CIT(A)-30 did not provide sufficient reasons for non-admission of additional evidence as per letter and spirit of Rule 46A of the Rules, which were submitted without any blemish so as to advance the cause of justice for the Assessee.” Page | 2 3. The authorised representative (AR) of the assessee submitted that the ld CIT(A) has passed the impugned first appellate order in violation of principles of natural justice as he did not admit the additional evidence filed by the assessee under section 46A of the ITAT Rules, 1962. Therefore, the additional evidence filed by the assessee may kindly be admitted for consideration. The ld AR submitted that the assessee was not provided due opportunity of hearing by the ld AO therefore relevant documents and evidences could not be filed before him which was subsequently filed before the ld CIT(A). During the first appellant proceedings the assessee was prevented by sufficient cause for not filing the same before the AO. 4. Replying to the above the ld CIT DR strongly supported the first appellate order. However, in a fairness the ld CIT DR submitted that if it is found just and proper then the department has no objection if the matter be restored to the file of ld CIT(A) for de novo adjudication of appeal. 5. On careful consideration of the above submission and assessment order we note that in para 2 the AO noted that vide questionnaire dated 02.09.2011 and entry dated 08.11.2011 the assessee was asked to furnish copy of cash book and bank statement for AY 2008-09 and to explain the source of cash credit entries therein proving the identity and creditworthiness of the creditors as well as the genuineness of the transaction in respect of credit entries in of its books of account of the assessee u/s 68 by providing confirmed copy of account, PAN, full address, return of income and bank statement of creditor. In para 2.1 the AO noted that despite many opportunities the assessee did not give any explanation. In view of these factual position of assessment proceedings we satisfy that the AO has not provided due opportunity of hearing to the assessee without providing reasonable opportunity of hearing to the assessee and proceeded to make assessment, which is in violation of Page | 3 principle of natural justice. Further, from first appellate order we noted that the ld CIT(A) has denied to admit the additional evidence of assessee without any cogent and justified reason. The ld CIT(A) was required to consider the observation of the AO made in the assessment order which clearly shows violation of principle of natural justice and there is no mentioning of any service of notice on the assessee calling the explanation and documentary evidence. Therefore, we are satisfied that the assessee was prevented of sufficient cause from filing explanation and documentary evidence before the ld AO during the assessment proceedings. Therefore, the ld CIT(A) ought to have admit the additional evidence filed by the assessee. Only on this count order of the ld CIT(A) is not sustainable and hence, we satisfy the same. The additional evidence filed by the assessee before the ld CIT(A) is admitted for consideration and matter is restored to the file of the ld CIT(A) for fresh adjudication of first appellate order after allowing due opportunity to the assessee and without being prejudice from the earlier first appellate order. 6. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open court on 27/04/2023. -Sd/- Sd/- (M. Balaganesh) (C. M. GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 27/04/2023 A K Keot Copy forwarded to 1. Applicant 2. Respondent 3. CIT 4. CIT (A) 5. DR:ITAT ASSISTANT REGISTRAR ITAT, New Delhi