M/S. INDORE DEVELOPMENT AUTHORITY, Indore V. The ACIT 5(1), Indore

ITA 477/IND/2014

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 5496 (ITAT-INDORE)
• Duration Of Justice: 2 year(s) 4 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-11-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 23-11-2016
• Assessment Year: 2006-2007
• Appeal Filed On: 25-06-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: LALCHAND; MOHD JAVED
• Keywords: Additional evidence
• Section: 263

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE . . , . . , ' BEFORE SHRI D.T. GARASIA, JUDICIAL MEMBER AND SHRI O.P. MEENA, ACCOUNTANT MEMBER INDORE DEVELOPMENT AUTHORITY , IDA BUILDING , 7,RACE COURSE ROAD, INDORE VS. ACIT 5(1) INDORE / APPELLANT / RESPONDENT . . ./ PAN:AAAJI 0103 J / APPELLANT BY SHRI LAL CHAND CIT (DR) AND SHRI MOHD. JAVED, SR. DR / RESPONDENT BY SHRI ANIL KAMAL GARG, CA / DATE OF HEARING 23.11.2016 / DATE OF PRONOUNCEMENT 23.11.2016 / O R D E R PER O.P. MEENA, ACCOUTANT MEMEBR. THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE ORDER OF LD. COMMISSIONER OF INCOME TAX (APPEALS)-II, INDORE [HEREINAFTER REFERRED TO AS THE CIT (A)] DATED 27.02.2014. THIS APPEAL PERTAINS TO ASSESSMENT YEAR 20 06-07 AS AGAINST APPEAL DECIDED IN RESPECT OF ASSESSMENT ORDER DATED 30. 11.2011 PASSED U/S. 143(3)/263 OF INCOME TAX ACT, 1961(HEREIN AFTER REF ERRED TO AS 'THE ACT) BY THE ACIT 5(1) INDORE [HEREINAFTER REFERRED TO AS THE AO ]. . . /. I.T.A. NO. 477 /IND/2014 $ $ / ASSESSMENT YEAR:2006-07 INDORE DEVELOPMENT AUTHORITY / I.T.A. NO.477 /IND/2 014/A.Y.:06-07 PAGE 2 OF 5 2. THE SOLE GROUND OF APPEAL STATES THAT THE LD. CIT (A) GROSSLY ERRED IN CONFIRMING THE DISALLOWANCE OF RS.86, 86,859/- MADE BY THE AO ON ACCOUNT OF GRANT-IN- AID. 3. SUCCINCTLY, FACTS AS CULLED OUT FROM THE ORDERS OF L OWER AUTHORITIES ARE THAT THE ORIGINAL ASSESSMENT ORDER DTD. 29.12.2008 HAS BEEN SE T-ASIDE BY THE CIT-II VIDE ORDER UNDER SECTION 263 OF THE ACT DTD. 24.03.2011 TO RE-EXAMINE THE ISSUE OF GRANT-IN- AID AMOUNTING TO RS.4, 08, 80,000. THE FAC TS ARE THAT THE ASSESSEE HAS RECEIVED GRANT-IN- AID OF RS.1,58,80,000/- FROM DIRE CTORATE, URBAN ADMINISTRATION AND DEVELOPMENT, GOVT. OF MP, BHOPAL, FO R IMPLEMENTATION OF VALMIKI AMBEDKAR AAVAS YOJANA ON BEHALF OF MUNICIPAL C ORPORATION, DEWAS AND RS. 2,50,00,000/- FROM HOUSING & DEVELOPMENT CORPOR ATION LTD., BHOPAL, FOR IMPLEMENTATION OF VAMBAY SCHEMES OF GOVT. OF INDIA , AGGREGATING TO RS. 4,08,80,000/-. HOWEVER, IT WAS FOUND THAT THE ASSES SEE HAD INCURRED EXPENDITURE OF RS. 3,21,93,141/- ONLY I.E. [ RS. 1, 66,14,755 FOR VALMIKI AMBEDKAR AAVAS YOJANA SCHEMES NO. 103 AND RS. 1,55,78,386/- FOR VAMBAY SCHEMES NO. 140). ACCORDINGLY, THE BALANCE OF RS. 86,86,859/- BEI NG UNUTILIZED GRANT-IN- AID WAS ADDED TO TOTAL INCOME. 4. BEING, AGGRIEVED THE ASSESSEE FILED AN APPEAL BEFORE T HE LD. CIT (A). IT WAS CLAIMED THAT THE ASSESSEE HAS INCURRED A SUM OF RS. 7 ,78,967/- IN RESPECT OF OTHER SCHEMES UNDER VAMBAY PROJECTS OF WHICH DEDUCTI ON WAS NOT ALLOWED BY THE AO. THEREFORE, UNUTILIZED GRANT-IN- AID WAS O NLY RS. 78,16,842/- FOR THE YEAR UNDER CONSIDERATION. FURTHER, THE LEARNED COUN SEL, SUBMITTED THAT THE ASSESSEE HAS UTILIZED THE UNUTILIZED GRANT-IN- AID IN SUBSEQUENT YEARS IN SPECIFIED SANCTIONED SCHEMES, HENCE, THERE WAS NO UNU TILIZED GRANT-IN- AID. IN INDORE DEVELOPMENT AUTHORITY / I.T.A. NO.477 /IND/2 014/A.Y.:06-07 PAGE 3 OF 5 SUPPORT OF THIS CONTENTION, THE LEARNED COUNSEL FILED AN APPLICATION FOR ADMISSION OF ADDITIONAL EVIDENCES UNDER RULE 18(4) O F APPELLATE TRIBUNAL RULES 1963 IN THE FORM OF COPY OF LEDGER ACCOUNTS OF CONSTR UCTION, INCOME AND EXPENDITURE ACCOUNT, COPY OF COMPUTATION OF TOTAL INC OME AND COPY OF AUDITED FINANCIAL ACCOUNTS FOR F.Y. 2008-09 IN WHIC H SUCH EXPENSES HAVE BEEN DEBITED AND REFLECTED. ACCORDINGLY, IT WAS URGE D BEFORE US THAT ADDITIONAL EVIDENCES MAY BE ADMITTED, IN THE LIGHT OF DECISION IN THE CASE OF PRESTIGE FOODS LTD. VS. DCIT (1997) 58 TTJ (IND) 30 0 , WHEREIN, IT WAS HELD THAT TRIBUNAL IS A FACT FINDING AUTHORITY AND THEREFORE, IN ORDER TO MEET ENDS OF JUSTICE, THE TRIBUNAL IS COMPETENT TO ADMIT EVEN THOSE ADDITIONAL EVIDENCES WHICH COULD HAVE BEEN FILED BY THE ASSESSEE BEFORE TH E AUTHORITIES BELOW. FOR GIVING SUCH PRONOUNCEMENT, THIS HON`BLE BENCH HAS PLAC ED RELIANCE UPON THE PRONOUNCEMENT OF CIT VS. KUM. SATYA SETIA (1983) 143 I TR 486(MP) AND DECISION OF HON`BLE PUNJAB & HARYANA HIGH COURT IN T HE CASE OF CIT VS. SALIGRAM PREMNATH (1989) 179 ITR 239 (P&H).THEREFORE, IT WAS URGED UPON US TO ADMIT THE ADDITIONAL EVIDENCES IN THE INTEREST OF JU STICE. 5. THE LD. DR RELIED ON THE ORDERS OF LOWER AUTHORITIE S. HOWEVER, HE HAS NO OBJECTION IF IN THE INTEREST OF JUSTICE, THE ISSUE IS SET-ASIDE TO THE FILE OF THE AO. 6. WE HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE PERUSED T HE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THE ASSESSEE HAS NOT FILED DETAILS TO ESTABLISH THAT THERE WAS NO UNUTILIZED GRANT-IN- AID REMAINED AS IT WAS U TILIZED IN SUBSEQUENT YEAR IN THE SPECIFIED SCHEMES. AS THE ADDITIONAL EVIDENCES AS FILED NOW BEFORE US GOES TO THE FACTS OF THE CASE, WHICH NEED EXAMINATIO N AT THE END OF THE AO. SINCE THE ADDITIONAL EVIDENCES WERE NOT BEFORE THE A O AND CIT (A), WE INDORE DEVELOPMENT AUTHORITY / I.T.A. NO.477 /IND/2 014/A.Y.:06-07 PAGE 4 OF 5 CONSIDER IT REASONABLE TO ALLOW THE ADMISSION OF THE SAME AS THIS BEING A PUBLIC AUTHORITY AND THERE CANNOT BE ANY DIVERSION OF GRANT-IN-AID RECEIVED FROM GOVERNMENT AUTHORITIES. RELIANCE IS PLACED ON THE DECISION, IN THE CASE THE PRESTIGE FOODS LTD. VS. DCIT (1997) 58 TTJ (IND ) 300 WHEREIN IT WAS HELD THAT TRIBUNAL IS A FACT FINDING AUTHORITY AND THEREFORE, IN ORDER TO MEET ENDS OF JUSTICE, THE TRIBUNAL IS COMPETENT TO ADMIT EVEN THOSE ADDITIONAL EVIDENCES WHICH COULD HAVE BEEN FILED BY THE ASSESSEE BEFORE TH E AUTHORITIES BELOW. FURTHER RELIANCE IS PLACED ON THE DECISION OF HON`BLE JURISDICTIONAL HIGH COURT OF MADHYA PRADESH IN THE CASE OF CIT VS. KUM. SATYA SETIA (1983) 143 ITR 486(MP) WHEREIN, IT WAS HAD AS THE TRIBUNAL IS THE FINAL FACT-FINDING BODY UNDER T HE SCHEME OF THE ACT. POWERS, THEREFORE, HAVE NECESSAR ILY TO BE EXERCISED BY IT FOR DECIDING THE QUESTION S OF FACT AND WHILE EXERCISING ITS POWERS, IF THE TRI BUNAL IS OF THE OPINION THAT ADDITIONAL EVIDENCE IS MATERIAL IN THE INTEREST OF JUSTICE FOR DECIDING TH E PARTICULAR ISSUE, ITS DISCRETION CANNOT BE INTERF ERED WITH UNLESS IT HAS BEEN EXERCISED ON NON-EXISTING O R IMAGINARY GROUNDS. MOREOVER, RULE 29 OF THE APPELLATE TRIBUNAL RULES, 1963, IS IN PARI MATERIA WITH ORDER 41, RULE 27, OF THE CIVIL PROCEDURE CODE , 1908. IT IS WITHIN THE DISCRETION OF THE APPELLATE AUTHORITY TO ALLOW PRODUCTION OF ADDITIONAL EVIDENC E IF THE SAID AUTHORITY REQUIRES ANY DOCUMENT TO ENABLE IT TO PASS ORDERS OR FOR ANY OTHER SUBSTANTIAL CAUSE. THEREFORE, EVEN IF THE ASSESSEE HAD FAILED T O FILE THE MODIFIED AGREEMENT BEFORE THE ITO AND TH E AAC, THE TRIBUNAL HAD THE JURISDICTION IN THE INTER EST OF JUSTICE TO ALLOW PRODUCTION OF A CRUCIAL DOCUMENT. ACCORDINGLY, IN THE INSTANT CASE, THE TRI BUNAL WAS CORRECT IN ADMITTING FRESH EVIDENCE IN TH E FORM OF THE MODIFIED AGREEMENT EVEN THOUGH THIS DOC UMENT WAS NOT PRODUCED BEFORE THE LOWER AUTHORITIES AND IN FURTHER HOLDING THAT IT DID NOT APPEAR TO BE A FABRICATED DOCUMENT. SIMILAR RATIO WAS LAID DOWN BY HON`BLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF CIT VS. SALIGRAM PREMNATH (1989) 179 ITR 239 (P&H). WHEREIN I T WAS HELD THAT THE IMPUGNED MATERIAL COULD NOT BE UNDOUBTEDLY USED AGA INST THE ASSESSEE WITHOUT GIVING IT AN INDORE DEVELOPMENT AUTHORITY / I.T.A. NO.477 /IND/2 014/A.Y.:06-07 PAGE 5 OF 5 OPPORTUNITY FOR THE REBUTTAL. SINCE THE ITO AND THE AAC RELIED ON THE IMPUGNED MATERIAL WHICH WAS RELIED UPON BY THE REVENUE BEFORE THE TRIBUNAL, THE TRIBUNAL WAS DUTY BOUND TO GIVE AN OPPORTUNITY TO THE ASSESSEE TO REBUT THE SAME AND, FOR THAT PURPOS E, THE TRIBUNAL COULD ITSELF GIVE THE OPPORTUNITY O R REMAND THE CASE SO AS TO DO COMPLETE JUSTICE BETWEE N THE PARTIES. THE TRIBUNAL HAD, THEREFORE, MISDIRECTED ITSELF ON THIS ASPECT. FURTHER, IF A NU MBER OF ARGUMENTS AROSE FOR SUSTAINING OR SETTING ASIDE AN ORDER AND IF ONE FACT OF THE ARGUMENT WAS NOT NOTICED, IT COULD NOT BE SUCCESSFULLY CONTENDED THAT A QUESTION DID NOT ARISE OUT OF THE TRIBUNAL'S ORDER. CONSIDERING THESE FACTS, CIRCUMSTANCES, AND CASE LAWS ABOVE, WE ALLOW THE ADM ISSION OF THESE ADDITIONAL EVIDENCES IN THE INTEREST OF JUSTICE AND FAIR PLAY. ACCORDINGLY, THESE ADDITIONAL EVIDENCES ARE ALLOWED TO BE ADMITTED FOR EXAMINATION BY THE AO . IN VIEW OF THESE FACTS, THE APPEAL IS SET-ASIDE TO TH E FILE OF THE AO TO MAKE DE- NOVA ASSESSMENT AFTER ALLOWING OPPORTUNITY OF BEING H EARD TO THE ASSESSEE AND MAKING SUCH INQUIRIES AS PER HIS SATISFACTION. T HE ASSESSEE IS ALSO DIRECTED TO MAKE AVAILABLE ALL THE REQUIRED DOCUMENTS AND INFOR MATION AS REQUIRED BY THE AO. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED ; FOR STATISTICAL PURPOSE. 8. THE ORDER PRONOUNCED IN THE OPEN COURT ON 23.11.2016 SD/- (..) (D.T.GARASIA) JUDICIAL MEMBER S D / - (..) (O.P.MEENA) ACCOUNTANT MEMBER + / DATED : 23 RD NOVEMBER, 2016.OPM