DCIT, New Delhi V. Smt. Sunita Bhagchandka, New Delhi

ITA 2737/DEL/2011

• Counselvise Citation: 273720114 RSA 2011
• Duration Of Justice: 1 year(s) 6 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-12-2012
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 10-10-2012
• Assessment Year: 2006-2007
• Appeal Filed On: 27-05-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: RAMESH CHANDER
• Assessee Lawyers: R C RAICA
• Keywords: Gift; Recovery proceedings; Search and seizure; Share purchase agreement; Additional evidence; Documents seized
• Section: 143(3); 56

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH G: NEW DELHI BEFORE SHRI R.K. GUPTA, JUDICIAL MEMBER AND SHRI S.V. MEHROTRA, ACCOUNTANT MEMBER ITA NO. 2737/DEL/2011 ASSESSMENT YEAR: 2006-07 DCIT, CENTRAL CIRCLE-08, NEW DELHI. VS. SUNITA BHAGCHANDKA, 5, OLOF PALME MARG, VASANT VIHAR, NEW DELHI. PAN NO. AAHPB7159E (APPELLANT) (RESPONDENT) APPELLANT BY: SH. RAMESH CHANDER, CIT(DR) RESPONDENT BY: SH. R.C. RAI,CA O R D E R PER S.V. MEHROTRA, A.M. THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAIN ST THE ORDER OF LD. CIT(A) DATED 14/03/2011 FOR A.Y. 2006-07. 2. BRIEF FACTS OF THE CASE ARE THAT SEARCH AND SEIZ URE ACTION WAS TAKEN IN M2K GROUP OF COMPANIES ON 24/01/2007. SATISFACTION WAS RECORDED ON THE BASIS OF DOCUMENTS SEIZED RELATING TO ASSESSEE AS P ER PROVISIONS OF SECTION 153C OF THE INCOME TAX ACT. THE ASSESSEE FILED ITS RETURN OF INCOME ON 05/12/2008 DECLARING INCOME OF RS. 19,90,520/-. ITA NO. 2737/D/2011 2 3. THE ASSESSING OFFICER NOTICED THAT ASSESSEE HAD SHOWN INCOME FROM HOUSE PROPERTY AND INCOME FROM OTHER SOURCES. HE F URTHER NOTICED THAT AS PER BALANCE SHEET OF THE ASSESSEE FOR THE PERIOD EN DING 31/03/2006, SHE HAD SHOWN TO HAVE RECEIVED A GIFT OF RS. 2,82,61,09 1/-. THE ASSESSEE EXPLAINED THAT SHE HAD RECEIVED 23 LAKH SHARES OF N EGOLICE INDIA FROM SMT. MEENA BHAGCHANDKA. A COPY OF GIFT DEED WAS ALSO FI LED. THE AO CROSS CHECKED THE BALANCE SHEET OF SMT. MEENA BHAGCHANDKA AND FOUND THAT AS ON 31/03/2005, THE SHARES OF NEGOLICE INDIA LTD. WO RTH RS. 2,82,61,091/- WERE APPEARING AS PART OF INVESTMENTS. HE FURTHER NOTICED THAT THE SAME INVESTMENT ALSO APPEARED IN THE BALANCE SHEET AS ON 31/03/2006 IN THE SCHEDULE INVESTMENTS. HE, THEREFORE, CONCLUDED T HAT THE ALLEGED GIFT SHOWN BY THE ASSESSEE IN HER BALANCE SHEET WAS NOTHING BU T BOGUS, AND THERE WAS NO SUCH REAL TRANSFER OF SHARES FROM SMT. MEENA BHA GCHANDKA TO THE ASSESSEE. HE, THEREFORE, TREATED THE SUM OF RS. 2, 82,61,091/- AS UNDISCLOSED INCOME OF THE ASSESSEE. 4. BEFORE LD. CIT(A), IT WAS, INTER-ALIA, SUBMITTED AS UNDER: - A) SINCE ONLY 11 WORKING DAYS WERE ALLOWED BEFORE T HE ASSESSMENT ORDER WAS PASSED, NO PROPER OPPORTUNITY WAS PROVIDE D BY THE AO; B) THE GIFT OF 23 LAKH EQUITY SHARES OF M/S NEGOLIC E INDIA LTD., VALUED AT RS. 2,82,61,091/- FROM HER SISTER-IN-LAW SMT. MEENA ITA NO. 2737/D/2011 3 BHAGCHANDKA ON 23/01/2006 WAS SUPPORTED BY GIFT DEE D AND OTHER DOCUMENTS NAMELY NAME, ADDRESS, PAN, ASSESSME NT DETAILS OF DONORS ETC. FILED BEFORE THE AO. C) THE ASSESSEE ALSO FILED FOLLOWING DOCUMENTS ALON G WITH PETITION UNDER RULE 46A: I) COPY OF AFFIDAVIT FROM DONOR DULY CONFIRMING THE GIFT ON OATH DULY NOTARIZED BY NOTARY PUBLIC. II) COPY OF TRANSFER DEED DULY EXECUTED BY DONOR IN FAVOUR OF APPELLANT. III) COPY OF ANNUAL RETURN ALONG WITH FILING PROOF FILED BY INVESTEE COMPANY NAMELY NEGOLICE INDIA LTD. IN R.O.C. (A GOVT. INDIA AGENCY) SHOWING THE NAME OF THE ASSESSEE AND TRANSFER NAME (I.E. DONOR, MRS. MEENA BHAGCHANDKA). IV) COPY OF STATEMENT OF DEMAT ACCOUNT OF ASSESSEE HELD WITH ABN AMRO BANK SHOWING THE SHARES DULY TRANSFERRED AND HELD BY ASSESSEE. V) CORRESPONDENCE MADE WITH COMPANY FOR DEMATERIALIZATION OF SHARES FROM PHYSICAL FORM TO DEMAT FORM. AS REGARDS, AOS OBSERVATION THAT THE SHARES WERE N OT TRANSFERRED IN THE NAME OF THE APPELLANT, AS THE INVESTMENT WAS NO T REDUCED IN THE BALANCE SHEET OF THE DONOR ETC., THE ASSESSEE RELIE D ON CBDT CIRCULAR NO. 704 DATED 28/04/1995 ACCORDING TO WHIC H SHARES GOT TRANSFERRED AS SOON AS TRANSFER DEED WAS SIGNED BY THE DONOR AND THE SHARE CERTIFICATES WERE HANDED OVER TO THE DONE E. THE ASSESSEE ITA NO. 2737/D/2011 4 DEMONSTRATED THESE FACTS FROM THE STATUTORY RECORDS OF THE COMPANY, ROC AND THE DEPOSITORY INCOME. 5. LD. CIT(A) HAD CALLED FOR THE REMAND REPORT FROM THE ASSESSING OFFICER WHOSE REPORT HAS BEEN REPRODUCED IN PARA 11 OF HIS ORDER. IN THE REMAND REPORT, THE AO OBJECTED TO THE ADMISSION OF ADDITIO NAL EVIDENCE. LD. CIT(A), HOWEVER, AFTER CONSIDERING THE ASSESSEES SUBMISSIO NS AND VARIOUS CASE LAWS ON THE ISSUE ADMITTED THE ADDITIONAL EVIDENCE AND ALLOWED THE ASSESSEES APPEAL. BEING AGGRIEVED WITH THE ORDER OF LD. CIT(A), THE DEPARTMENT IS IN APPEAL BEFORE US AND HAS TAKEN FOL LOWING GROUNDS OF APPEAL: - 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD.CIT(A)-II, NEW DELHI HAS ERRED IN GIVING RELIEF OF RS. 2,82,61,091/- BY ADMITTING THE ADDITIONAL EVIDENCE IN THE FORM OF OLD AFFIDAVIT OF THE DONOR, WHICH CREATES DOUBT ABOUT THE GENUINENESS OF THE TRANSACTION. 2. ON THE FACT AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED IN ADMITTING THE ADDITIONAL EVIDENCE UNDER RULE 46A, WHEREAS THE CASE OF THE ASSESSEE DOES NOT FALL WITHIN THE AMBIT OF ANY OF THE PARAMETER OF RULE 46A. ITA NO. 2737/D/2011 5 6. LD. DR SUBMITTED THAT NO GIFT DEED WAS FILED BEF ORE AO AND LD. CIT(A) ADMITTED THE ADDITIONAL EVIDENCE IN VIOLATION OF RU LE 46A. HE REFERRED TO THE ASSESSMENT ORDER AND POINTED OUT THAT IN SPITE OF A LLEGED GIFT OF 23 LAKH SHARES OF NEGOLICE INDIA LTD. BEING MADE BY SMT. ME ENA BHAGCHANDKA IN FAVOUR OF THE ASSESSEE BEFORE 31/03/2006, THE SAME INVESTMENT CONTINUED IN HER BALANCE SHEETS, BOTH, ENDING ON 31/03/2005 AND 31/03/2006. HE, THEREFORE, SUBMITTED THAT THERE WAS NO TRANSFER OF SHARES IN FAVOUR OF ASSESSEE AND, THUS, THE ALLEGED GIFT SHOWN BY THE A SSESEE WAS NOTHING BUT ASSESSEES UNDISCLOSED INCOME. 7. LD. COUNSEL FOR THE ASSESEE SUBMITTED THAT IT IS A CASE OF ASSESSMENT U/S 153C READ WITH SECTION 143(3) AND, THEREFORE, A SSESSMENT COULD NOT BE MADE ONLY WHEN SOME INCRIMINATING MATERIAL WAS FOUN D ON THE BASIS OF WHICH IT COULD BE INFERRED THAT THERE WAS SOME UNDI SCLOSED INCOME OF THE ASSESSEE. HE SUBMITTED THAT IN THE PRESENT CASE, A S A CONSEQUENCE OF SEARCH AND SEIZURE IN THE CASE OF SHRI MAHESH KUMAR BHAGCHANDKA (HUSBAND OF THE ASSESSEE), A CERTIFICATE ISSUED BY VIJAYA BANK HAD BEEN SEIZED ON THE BASIS OF WHICH ACTION HAS BEEN TAKEN IN THE CASE OF ASSESSEE. HE SUBMITTED THAT THIS WAS NOT AN INCRIMINATING DOC UMENT AND, THEREFORE, THE ACTION U/S 153C WAS NOT WARRANTED. ITA NO. 2737/D/2011 6 8. WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE P ARTIES AND HAVE PERUSED THE RECORD OF THE CASE. AS FAR AS LD. COUN SELS SUBMISSIONS REGARDING INITIATION OF PROCEEDINGS U/S 153C ARE CO NCERNED, WE FIND THAT LD. CIT(A) IN PARA 9 OF HIS ORDER HAS REFERRED TO THE D ECISION OF CIT(A) IN ASSESSEES OWN CASE FOR A.Y. 2001-02 DECIDED BY LD. CIT(A). HE HAS REPRODUCED THE FINDINGS OF LD. CIT(A) IN PARA 8 OF HIS ORDER. 9. LD. CIT(A) HAD DECIDED THIS ISSUE AGAINST THE AS SESSEE BUT THE ASSESSEE DID NOT PREFER ANY FURTHER APPEAL ON THIS ISSUE BEFORE TRIBUNAL. BEFORE US ALSO ASSESSEE HAS NOT FILED ANY CROSS OBJ ECTION. THEREFORE, THIS ISSUE CANNOT NOW BE RAISED. HOWEVER, EVEN OTHERWIS E WE FIND THAT THE PROCEEDINGS U/S 153C WERE INITIATED ON THE BASIS SE IZED MATERIAL ON THE BASIS OF WHICH AO RECORDED HIS SATISFACTION. WE AR E IN AGREEMENT WITH THE FINDINGS OF LD. CIT(A) AS REPRODUCED BY LD. CIT(A) IN HIS ORDER IN PARA 8 OF HIS ORDER FOLLOWING THE ORDER OF A.Y. 2001-02. 10. NOW COMING TO THE MAIN ISSUE IN DEPARTMENTS AP PEAL, WE FIND THAT IN THE REMAND REPORT, THE AO HAD DISPUTED THE ADMISSIO N OF ADDITIONAL EVIDENCE AS NOTED EARLIER IN PARA 5. HE HAD, INTER-ALIA, OB SERVED AS UNDER: - MOREOVER, THE ADDITIONAL EVIDENCE FILED BY THE ASSE SSEE IN THE FORM OF SHARE TRANSFER FROM DT. 06/12/2005 IS INVAL ID AS THE SHARE TRANSFER FORM DOES NOT CONTAIN SHARE TRANSFER STAMP S. MOREOVER, GIFT ITA NO. 2737/D/2011 7 DEED HAD NOT BEEN PRODUCED AS A PROOF OF GIFT BEFOR E THE AO AT THE TIME OF ASSESSMENT PROCEEDINGS, HELD DURING THE MON TH OF PROOF OF GIFT BEFORE THE AO AT THE TIME OF ASSESSMENT PROCEE DINGS, HELD DURING THE MONTH OF DECEMBER, 2008 WHERE AS THE ALL EGED GIFT DEED WAS MADE ON 23.01.06. IN VIEW OF THIS IT IS OPINED THAT THE ASSESSEE IS NOT ENTITLED TO PRODUCE ADDITIONAL EVIDENCE UNDE R RULE 46A. SINCE THE ASSESSEES CASE DOES NOT FALL WITH IN THE AMBIT OF ANY OF THE PARAMETERS OF RULE 46A, IT IS RECOMMENDED THAT PRODUCTION OF ADDITIONAL EVIDENCE IN THIS CASE SHOULD NOT BE ALLO WED. 11. HOWEVER, LD. CIT(A) ADMITTED THE ADDITIONAL EVI DENCE OBSERVING AS UNDER: - IN THEIR REJOINDER TO THE AOS REPORT REGARDING TH E ADDITIONAL EVIDENCE THE APPELLANT HAS SUBMITTED THA T THE AO ISSUED THE FIRST NOTICE U/S 143(2) DATED 10.12.2 008 FIXING THE DATE OF COMPLIANCE 16.12.2008 AND COMPLE TED THE ASSESSMENT OF THE APPELLANT ON 31.12.2008 I.E. WITH IN 11 WORKING DAYS. IN SPITE OF SUCH A SHORT SPAN THE APPELLANT PROVIDED ALL THE POSSIBLE DETAILS. IN VI EW OF SUCH CONSTRAINS IT WOULD APPEAR THAT THE ADDITIONAL EVIDENCE IS ADMISSIBLE UNDER RULE 46A. IT IS THERE FORE, HELD THAT UNDER THESE FACTS AND SUCH UNANIMOUS JUDI CIAL SANCTION TO ADMISSION OF ADDITIONAL EVIDENCE AT APP ELLATE STAGE ON VALID GROUNDS, THE PETITION AND THE EVIDEN CE FILED BY THE APPELLANT IN THIS CASE IS HEREBY ALLOW ED. ITA NO. 2737/D/2011 8 12. WE FIND THAT HONBLE DELHI HIGH COURT IN THE CA SE OF CIT VS. MANISH BUILD WELL P. LTD. VIDE ITA NO. 928/2011 ORDER DATE D 15/11/2011 HAS, INTER- ALIA, OBSERVED ON IMPORT OF RULE 46A AS UNDER: - RULE 46A IS A PROVISION IN THE INCOME TAX RULES, 1962 WHICH IS INVOKED, ON THE OTHER HAND, BY THE ASSESSE E WHO IS IN AN APPEAL BEFORE THE CIT(A). ONCE THE ASSESS EE INVOKES RULE 46A AND PRAYS FOR ADMISSION OF ADDITIO NAL EVIDENCE BEFORE THE CIT(A), THEN THE PROCEDURE PRESCRIBED IN THE SAID RULE HAS TO BE SCRUPULOUSLY FOLLOWED. THE FACT THAT SUB-SECTION (4) OF SECTION 250 CONFERS POWERS ON THE CIT(A) TO CONDUCT AN ENQUIRY AS HE THINKS FIT, WHILE DISPOSING OF THE APPEAL, CANNO T BE RELIED UPON TO CONTEND THAT THE PROCEDURAL REQUIREM ENTS OF RULE 46A NEED NOT BE COMPLIED WITH. IF SUCH A P LEA OF THE ASSESSEE IS ACCEPTED, IT WOULD REDUCE RULE 46A TO A DEAD LETTER BECAUSE IT WOULD THEN BE OPEN TO EVERY ASSESSEE TO FURNISH ADDITIONAL EVIDENCE BEFORE THE CIT(A) AND THEREAFTER CONTEND THAT THE EVIDENCE SHOULD BE ACCEPTED AND TAKEN ON RECORD BY THE CIT(A)BY VIRTUE OF HIS POWERS OF ENQUIRY UNDER SUB-SECTION (4) OF SEC. 250. THIS WOULD MEAN IN TURN THAT THE REQUIREMENT OF RECORDING REASONS FOR ADMITTING THE ADDITIONAL EVID ENCE, THE REQUIREMENT OF EXAMINING WHETHER THE CONDITIONS FOR ADMITTING THE ADDITIONAL EVIDENCE ARE SATISFIED, TH E REQUIREMENT THAT THE AO SHOULD BE ALLOWED A REASONA BLE OPPORTUNITY OF EXAMINING THE EVIDENCES ETC. CAN BE THROWN TO THE WINDS, A POSITION WHICH IS WHOLLY ITA NO. 2737/D/2011 9 UNACCEPTABLE AND MAY RESULT IN UNACCEPTABLE AND UNJ UST CONSEQUENCES. THE FUNDAMENTAL RULE WHICH IS VALID IN ALL BRANCHES OF LAW, INCLUDING INCOME TAX LAW, IS THAT THE ASSESSEE SHOULD ADDUCE THE ENTIRE EVIDENCE IN HIS POSSESSION AT THE EARLIEST POINT OF TIME. THIS ENS URES FULL, FAIR AND DETAILED ENQUIRY AND VERIFICATION. A 7-JU DGE BENCH OF THE SUPREME COURT IN KESHAV MILLSCO. LTD. VS. COMMISSIONER OF INCOME-TAX, BOMBAY NORTH, AHMEDABAD (1965) 56 ITR SC 365 HAD OBSERVED AS UNDER: - PROCEEDINGS TAKEN FOR THE RECOVERY OF TAX UNDER THE PROVISIONS OF THE ACT ARE NATURALLY INTENDED TO BE OVER WITHOUT UNNECESSARY DELAY, AND SO, IT IS THE DUTY OF THE PARTIES, BOTH THE DEPARTMENT AND THE ASSESSEE, TO LEAD ALL THEIR EVIDENCE AT THE STAGE WHEN THE MATTER IS IN CHARGE OF THE INCOME-TAX OFFICER. 23. IT IS FOR THE AFORESAID REASON THAT RULE 46A ST ARTS IN A NEGATIVE MANNER BY SAYING THAT AN APPELLANT BE FORE THE CIT(A) SHALL NOT BE ENTITLED TO PRODUCE BEFORE HIM ANY EVIDENCE, WHETHER ORAL OR DOCUMENTARY, OTHER TH AN THE EVIDENCE ADDUCED BY HIM BEFORE THE AO. AFTER MAKING SUCH A GENERAL STATEMENT, WHICH IS IN CONSON ANCE WITH THE PRINCIPLE STATED IN THE ABOVE JUDGMENT, EXCEPTIONS HAVE BEEN CARVED OUT THAT IN CERTAIN CIRCUMSTANCES IT WOULD BE OPEN TO THE CIT(A) TO ADM IT ADDITIONAL EVIDENCE. THEREFORE, ADDITIONAL EVIDENC E CAN BE PRODUCED AT THE FIRST APPELLATE STAGE WHEN CONDI TIONS ITA NO. 2737/D/2011 10 STIPULATE IN THE RULE 46A ARE SATISFIED AND A FINDI NG IS RECORDED. RULE 46A READS AS UNDER: - PRODUCTION OF ADDITIONAL EVIDENCE BEFORE THE [DEPUTY COMMISSIONER (APPEALS)] [AND COMMISSIONER (APPEALS)]. 46A. (1) THE APPELLANT SHALL NOT BE ENTITLED TO PRODUCE BEFORE THE [DEPUTY COMMISSIONER (APPEALS)], ANY EVIDENCE, WHETHER ORAL OR DOCUMENTARY, OTHER THAN THE EVIDENCE PRODUCED BY HIM DURING THE COURSE OF PROCEEDINGS BEFORE THE [ASSESSING OFFICER], EXCEPT IN THE FOLLOWING CIRCUMSTANCES, NAMELY: A) WHERE THE [ASSESSING OFFICER] HAS REFUSED TO ADMIT 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 RELEVANT TO ANY GROUND OF APPEAL; OR D) WHERE THE [ASSESSING OFFICER] HAS MADE THE ORDER APPEALED AGAINST WITHOUT GIVING SUFFICIENT OPPORTUNITY ITA NO. 2737/D/2011 11 TO THE APPELLANT TO ADDUCE 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 COMMISSIONER (APPEALS)] RECORDS IN WRITING THE REASONS FOR ITS ADMISSION. (3) THE [DEPUTY COMMISSIONER (APPEALS)] [OR, AS THE CASE MAY BE, THE COMMISSIONER (APPEALS)] SHALL NOT TAKE INTO ACCOUNT ANY EVIDENCE PRODUCED UNDER SUB-RULE (1) UNLESS THE [ASSESSING OFFICER] HAS 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 WITNESS 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 EXAMINATION OF ANY WITNESS, TO ENABLE HIM TO DISPOSE OF THE APPEAL, OR FOR ANY OTHER SUBSTANTIAL CAUSE INCLUDING THE ENHANCEMENT OF THE ASSESSMENT OR PENALTY (WHETHER ON HIS ITA NO. 2737/D/2011 12 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 SECTION 271.] WE ARE HIGHLIGHTING THESE ASPECTS ONLY TO PRESS HOME THE POINT THAT THE CONDITIONS PRESCRIBED IN RULE 46A MUST BE SHOWN TO EXIST BEFORE ADDITIONAL EVIDENCE IS ADMITTED AND EVERY PROCEDURAL REQUIREMENT MENTIONED IN THE RULE HAS TO BE STRICTLY COMPLIED WITH SO THAT THE RULE IS MEANINGFULLY EXERCISED AND NOT EXERCISED IN A ROUTINE OR CURSORY MANNER. A DISTINCTION SHOULD BE RECOGNIZED AND MAINTAINED BETWEEN A CASE WHERE THE ASSESSEE INVOKES RULE 46A TO ADDUCE ADDITIONAL EVIDENCE BEFORE THE CIT(A) AND A CASE WHERE THE CIT(A), WITHOUT BEING PROMPTED BY THE ASSESSEE, WHILE DEALING WITH THE APPEAL, CONSIDERS IT FIT TO CAUSE OR MAKE A FURTHER ENQUIRY BY VIRTUE OF THE POWERS VESTED IN HIM UNDER SUB-SECTION (4) OF SECTION 250. IT IS ONLY WHEN HE EXERCISES HIS STATUTORY SUO MOTO POWER UNDER THE ABOVE SUB-SECTION THAT THE REQUIREMENTS OF RULE 46A NEED NOT BE FOLLOWED. ON THE OTHER HAND, WHENEVER THE ASSESSEE WHO IS IN APPEAL BEFORE HIM INVOKES RULE 46A, IT IS INCUMBENT UPON THE CIT(A) TO COMPLY WITH THE REQUIREMENTS OF THE RULE STRICTLY. ITA NO. 2737/D/2011 13 13. IN VIEW OF THE ABOVE DECISION, SINCE ASSESSEE H AD PRODUCED ADDITIONAL EVIDENCE IT WAS INCUMBENT UPON LD. CIT(A) TO PROVID E DUE OPPORTUNITY TO AO AFTER HE HAD ADMITTED THE ADDITIONAL EVIDENCE. MOR EOVER, THE GRIEVANCE OF THE ASSESSEE WAS ALSO THAT SINCE ONLY 11 WORKING DA YS WERE ALLOWED BEFORE THE ASSESSMENT ORDER WAS PASSED, NO PROPER OPPORTUN ITY WAS PROVIDED BY THE AO. UNDER SUCH CIRCUMSTANCES, WE RESTORE THE M ATTER TO THE FILE OF AO TO EXAMINE THE ADDITIONAL EVIDENCE FILED BY THE ASSESS EE AND DECIDE THE ISSUE IN ACCORDANCE WITH LAW AFTER AFFORDING DUE OPPORTUN ITY OF BEING HEARD TO THE ASSESSEE. 14. IN VIEW OF THE ABOVE DISCUSSION, THE DEPARTMENT S APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 14.12.2012 SD/- SD/- (R.K. GUPTA) JUDICIAL MEMBER (S.V. MEHROTRA) ACCOUNTANT MEMBER DATED: 14.12.2012 *KAVITA ITA NO. 2737/D/2011 14 COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT, NEW DELHI. TRUE COPY BY ORDER ASSISTANT REGISTRAR