Sh Harish Joshi, Sonepat V. DCIT, Sonepat

ITA 604/DEL/2012

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 61605 (ITAT-DELHI)
• Duration Of Justice: 2 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-04-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 09-04-2012
• Assessment Year: 2009-2010
• Appeal Filed On: 03-02-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SATPAL SINGHDR
• Keywords: Principle of natural justice; Additional evidence
• Section: 142(1); 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI C BENC H BEFORE SHRI U.B.S. BEDI, JM & SHRI A.N. PAHUJA, A M ITA NO.604/DEL/2012 ASSESSMENT YEAR:2009-10 HARISH JOSHI, PROPRIETOR TECH CREATIONS, 25/11, RAMPURA, NEAR SHRI RAM MANDIR, GANAUR, SONEPAT V/S . DCIT,SONEPAT CIRCLE, SONEPAT [PAN : AIDPJ 3080 A) (APPELLANT) (RESPONDENT) ASSESSEE BY SHRI K. SAMPATH, AR REVENUE BY SHRI SAT PAL SINGH,DR DATE OF HEARING 09-04-2012 DATE OF PRONOUNCEMENT 09-04-2012 O R D E R A.N.PAHUJA:- THIS APPEAL FILED ON 03.2.2012 BY THE REVENUE AGAIN ST AN ORDER DATED 7.12.2011 OF THE LD. CIT(A), ROHTAK, RAISES T HE FOLLOWING GROUNDS:- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE CIT(A) ERRED IN :- I) NOT ADMITTING CRUCIAL TO EVIDENCE AND OMITTING T O ADJUDICATE ON THE CONTENTION AND CLAIM OF THE APPELLANT AS TO TDS DISCREPANCIES IMPINGING ON THE COMPUTATION OF GROSS RECEIPTS FROM BUSINESS; II) OTHERWISE APPROVING THE ADDITION OF THE GROSS RECEIPT ITSELF INSTEAD OF THE PROFIT ENNURING OUT O F SUCH RECEIPTS. ABOVE ACTIONS BEING ARBITRARY, MISCONCEIVED, FALLAC IOUS, UNWARRANTED AND UNJUST MUST BE QUASHED WITH DIRECTI ONS FOR RELIEF. ITA N O.604 /DEL./2012 2 2. FACTS, IN BRIEF, AS PER RELEVANT ORDERS ARE THA T E-RETURN DECLARING INCOME OF ` `6,11,160/- FILED ON 29.09.2009 BY THE ASSESSEE, M ANUFACTURING LEATHER GARMENTS BESIDES DOING JOB WORK OF LEATHER ACCESSORIES, WAS SELECTED FOR SCRUTINY WITH THE SERVICE OF A NOTICE U/S 143(2) OF THE INCOME-TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) ON 27 TH AUGUST, 2010. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER (A.O. IN SHORT) NOTICED THAT THE ASSESSEE A PROPRIETOR OF M/S TECH CREATION, A-10, S ECTOR-14, NOIDA, (UP), REFLECTED TURNOVER OF ` ` 3,35,38,494/- AND RECEIPT FROM SAMPLING AMOUNTING T O ` `10,90,100/-. THUS, THE TOTAL RECEIPTS WERE ` `3,46,28,594/- WHILE IN THE FORM NO.26AS,RECEIPTS WERE SHOWN AT ` ` 3,83,41,937/-. TO A QUERY BY THE AO, SEEKING RECONCILIATION OF RECEIPTS SHOWN IN THE PROFIT & LO SS ACCOUNT VIS-A-VIS RECEIPTS REFLECTED IN FORM NO. 26AS AND SHOWCAUSING THE ASSE SSEE AS TO WHY RECEIPTS TO THE EXTENT OF ` 48,03,483/- (3,83,41,937-3,35,38,494) BE NOT ADDED ,THE ASSESSEE EXPLAINED THAT THE DEDUCTOR WRONGLY MENTIONED ASSE SSEES PAN IN ITS TDS STATEMENT FILED WITH THE DEPARTMENT AND CONSEQUENTL Y, RECEIPTS APPEARED TO BE HIGHER IN FORM NO.26AS. TO A FURTHER QUERY BY THE AO, SEEKING CORRECT TDS STATEMENT, THE ASSESSEE DID NOT FURNISH ANY REPLY. ACCORDINGLY, THE AO ADDED THE AMOUNT OF ` ` 48,03,483 TO THE TOTAL INCOME BESIDE DISALLOWING 1 /10 TH OF CONVEYANCE EXPENSES AND TELEPHONE EXPENSES ON ACCOU NT OF PERSONAL USE OF THE VEHICLES AND TELEPHONES. 3. ON APPEAL, THE ASSESSEE SUBMITTED AN APPLICATIO N IN TERMS OF RULE 46A OF THE IT RULES,1962, REQUESTING ADMISSION OF A DDITIONAL EVIDENCE BESIDE FILING AN APPLICATION U/S 154 BEFORE THE AO FOR REC TIFICATION OF INCOME TO THE EXTENT OF ADVANCE RECEIVED FROM CUSTOMERS INCLUDED IN THE TOTAL INCOME. THE AO ACCEPTED THE ASSESSEES APPLICATION AND REDUCED THE INCOME BY ` ` 38,84,240/-, RESULTING IN NET ADDITION OF ` ` 15,19,203/-. AS REGARDS REQUEST MADE IN APPLICATIO N U/R 46A OF THE IT RULES,1962, THE ASSESSEE SUBMITTE D THE FOLLOWING DOCUMENTS BY WAY OF ADDITIONAL EVIDENCE:- 1) AUDITED BALANCE SHEET OF M/S HMC ENTERPRISES FO R THE ASSESSMENT YEAR 2009-10 ITA N O.604 /DEL./2012 3 2) AUDITORS REPORT U/S 44AB OF THE INCOME-TAX ACT, 1961 OF M/S HMC ENTERPRISES FOR THE ASSESSMENT YEAR 2009-10. 3.1. HOWEVER, THE LD. CIT(A) DID NOT ADMIT THE A FORESAID ADDITIONAL EVIDENCE AND CONCLUDED AS UNDER:- 4. I HAVE CONSIDERED THE ISSUE AND THE SUBMISSIONS MADE BY THE AR. ADMITTEDLY, THE ASSESSEE HAS NOT DISCLOSED THE ACTIVITIES OF M/S HMC ENTERPRISES IN THE RETURN OF INCOME E-FILED ON 29.9.2009. EVEN DURING THE COURSE OF ASSESSMENT PROCEEDINGS, T HIS FACT WAS NOT BROUGHT TO THE NOTICE OF THE ASSESSING OFFICER. IT IS NOT CORRECT TO STATE THAT THE ASSESSMENT WAS COMPLETED IN HASTE WITHOUT GIVING PROPER OPPORTUNITY TO THE ASSESSEE AS IT IS EVIDENT FROM THE ASSESSMENT ORDER ITSELF THAT THE INITIAL NOTICE U/S 143(2) WAS SERVED ON 27.8.2010 AND THEREAFTER A NUMBER OF NOTICES U/S 142(1) HAVE BEEN ISSUED AND THE ASSESSEE HAS BEEN REQUESTED MAN Y A TIMES TO EXPLAIN THE DISCREPANCY IN THE TURNOVER DECLARED IN THE RETURN OF INCOME WITH THAT OF FORM NO.26AS AND THE ASSESSMENT WAS FINALLY COMPLETED ON 28.3.2011. THOUGH THE ASSESSMENT WAS TIME BARRING ON 31.12.2011, IT DOES NOT MEAN THAT THE ASSESSING OFFICER HAS TO WAIT TILL THE TIME BARRING DATE TO COMPLETE THE ASS ESSMENT. IT IS FOR THE ASSESSING OFFICER TO ORGANIZE HIS WORK AND COMP LETE THE ASSESSMENTS IN A SYSTEMATIC AND REGULAR MANNER. IT CANNOT BE INFERRED FROM THE ASSESSMENT ORDER THAT ADEQUATE OP PORTUNITY WAS NOT GIVEN TO THE APPELLANT TO EXPLAIN THE DISCREPAN CIES. 4.1. THE CONDUCT OF THE APPELLANT IS EVIDENT FROM T HE FACT THAT EVEN IN THE APPLICATION FILED U/S 154 ON 27.4.2011, THE FACT OF OMISSION OF THE FINANCIAL STATEMENTS OF M/S HMC ENT ERPRISES WAS NOT BROUGHT OUT. THIS ATTITUDE IS FURTHER EVIDENT FROM THE REPLY OF THE ASSESSEE TO THE ASSESSING OFFICER THAT THE DISCREPA NCY IN THE TURNOVER IS ON ACCOUNT OF WRONG MENTION OF ASSESSEE S PAN IN TDS STATEMENT FILED BY THE DEDUCTOR WHEREAS THE DEDUCTO R HAS ACTUALLY NOTED THE CORRECT NAME AND PAN OF THE ASSESSEE. TH IS ISSUE OF OMISSION OF THE FINANCIAL STATEMENTS OF M/S HMC ENT ERPRISES IN THE RETURN FILED WAS TAKEN UP FOR THE FIRST TIME IN APP EAL PROCEEDINGS. 4.2 COMING TO THE ISSUE OF ADMISSION OF ADDITIONAL EVIDENCE, IT WOULD BE APPROPRIATE TO MENTION THE RELEVANT PROVIS IONS OF I.T. RULES, WHICH IS AS UNDER:- PRODUCTION OF ADDITIONAL EVIDENCE BEFORE THE DEPUT Y COMMISSIONER (APPEALS) AND COMMISSIONER (APPEALS). 46A.(1) THE APPELLANT SHALL NOT BE ENTITLED TO PROD UCE BEFORE THE DEPUTY COMMISSIONER (APPEALS) OR, AS THE CASE MAY BE, THE COMMISSIONER ITA N O.604 /DEL./2012 4 (APPEALS), ANY EVIDENCE, WHETHER ORAL OR DOCUMENTAR Y, OTHER THAN THE EVIDENCE PRODUCED BY HIM DURING THE COURSE OF PROCE EDINGS BEFORE THE ASSESSING OFFICER, EXCEPT IN THE FOLLOWING CIRCUMST ANCES, NAMELY:- A) WHETHER THE ASSESSING OFFICER HAS REFUSED TO ADMIT EVIDENCE WHICH OUGHT TO HAVE BEEN ADMITTED; OR B) WHERE THE APPELLANT WAS PREVENTED BY SUFFICIENT CAU SE FROM PRODUCING THE EVIDENCE WHICH HE WAS CALLED UPON TO PRODUCE BY THE ASSESSING OFFICER; OR C) WHERE THE APPELLANT WAS PREVENTED BY SUFFICIENT CAU SE 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 APPE ALED AGAINST WITHOUT GIVING SUFFICIENT OPPORTUNITY TO THE APPELL ANT TO ADDUCE EVIDENCE RELEVANT TO ANY GROUND OF APPEAL NO CASE HAS BEEN MADE OUT BY THE APPELLANT THAT HIS CASE FALLS UNDER CLAUSES (B), (C) & (D) OF RULE 46A. IN VIEW OF THE ABOVE, THE ADDITIONAL EVIDENCE SOUGHT TO BE PRODUCED BY TH E APPELLANT IS NOT ADMITTED. 4.3 ON MERITS, IT IS SEEN THAT THE ASSESSING OFFIC ER HAS HELD THAT WHILE THE EXPENSES HAVE BEEN ENTIRELY CLAIMED IN TH E BOOKS OF ACCOUNTS, THE APPELLANT RESORTED TO UNDERSTATEMENT OF RECEIPTS. IN VIEW OF THIS FINDING OF FACT BY THE ASSESSING OFFIC ER, REJECTION OF THE BOOKS OF ACCOUNTS U/S 145(3) IS JUSTIFIED. REGARDI NG THE CONTENTIONS OF THE AR THAT THE ENTIRE SUPPRESSED RE CEIPTS COULD NOT HAVE BEEN ADDED BUT ONLY THE NET PROFIT ON THIS ACC OUNT IS LIABLE FOR TAXATION, IT IS HELD THAT SUCH WORKING DEPENDS ON T HE FACTS OF EACH CASE. IN THE PRESENT CASE, IT HAS BEEN HELD BY THE ASSESSING OFFICER THAT THE EXPENSES HAVE BEEN PROPERLY RECORD ED WHEREAS IT IS ONLY THE SALES WHICH HAVE BEEN SUPPRESSED. CONS IDERING THE FACTS AND CIRCUMSTANCES OF THE CASE, RESORTING TO A DDITION ON THE NET PROFIT ON THE SUPPRESSED SALES WOULD NOT BE IN ORDE R AND THEREFORE, THE ADDITION OF SUPPRESSED RECEIPTS TO THE INCOME R ETURNED IS UPHELD AND THE GROUNDS OF APPEAL ARE DISMISSED. TH E CASE LAWS RELIED UPON BY THE AR ARE DISTINGUISHABLE ON FACTS. 3.2 AS REGARDS DISALLOWANCE OF 1/10 TH OF THE EXPENSES FOR PERSONAL USE OF CONVEYANCE AND TELEPHONES, THE LD. CIT(A) AFTER ADMITTING ADDITIONAL GROUND RAISED BY THE ASSESSEE, DELETED THE ADDITION. ITA N O.604 /DEL./2012 5 4. THE ASSESSEE IS NOW IN APPEAL BEFORE US AGAINST THE AFORESAID FINDINGS OF THE LD. CIT(A) IN REFUSING TO ADMIT ADD ITIONAL EVIDENCE AND THEREBY UPHOLDING THE ADDITION. THE LD. AR ON BEHALF OF THE ASSESSEE CONTENDED THAT THE LD. CIT(A) WAS NOT JUSTIFIED IN REJECTING THEIR REQ UEST FOR ADMISSION OF ADDITIONAL EVIDENCE PARTICULARLY WHEN THE ASSESSEE HAD REASONA BLE CAUSE IN NOT SUBMITTING THE AFORESAID DOCUMENTS IN TERMS OF CLAUSE (B) OF R ULE 46A OF THE I.T. RULES, 1962. SINCE M/S HMC ENTERPRISES SUFFERED LOSS, THE ACCOUNTANT IGNORED THE TRANSACTIONS IN THE SAID CONCERN AND DID NOT INCLUD E THE TURNOVER OF M/S HMC ENTERPRISES WHILE PREPARING CONSOLIDATED PROFIT AND LOSS ACCOUNT. THE LD. AR ADDED THAT THE LD. CIT(A) HAVING ADMITTED THE ADDIT IONAL GROUND, WAS NOT JUSTIFIED IN NOT ADMITTING ADDITIONAL EVIDENCE, WHEN REASONS FOR ADMISSION OF ADDITIONAL GROUND AND ADDITIONAL EVIDENCE WERE THE SAME. ON TH E OTHER HAND, THE LD. DR VEHEMENTLY OPPOSED THE REQUEST FOR ADMISSION OF ADD ITIONAL EVIDENCE. 5. WE HAVE HEARD BOTH THE PARTIES AND GONE THROUG H THE FACTS OF THE CASE. INDISPUTABLY, THE ASSESSEE DID NOT EXPLAIN B EFORE THE AO EITHER DURING THE ASSESSMENT PROCEEDINGS OR IN PROCEEDINGS U/S 154 AS TO WHY THE TURNOVER OF ANOTHER CONCERN M/S HMC ENTERPRISES WAS NOT REFLECT ED IN THE PROFIT AND LOSS ACCOUNT EVEN WHEN THE SAID CONCERN SUFFERED LOSS. I N THE RESULT, THE AO ADDED THE AMOUNT OF ` ` 48,03,483 TO THE TOTAL INCOME, WHICH WAS REDUCED T O ` 15,19,203/-IN PROCEEDINGS U/S 154 OF THE ACT . NO C OGENT REASONS HAVE BEEN ADDUCED BEFORE US NOR THESE ARE EVIDENT FROM THE IM PUGNED ORDER AS TO WHY THE ASSESSEE DID NOT FURNISH CORRECT FACTS IN RELATION TO TURNOVER OF M/S HMC ENTERPRISES BEFORE THE AO. THE PLEA NOW MADE BEFORE US THAT THIS WAS DUE TO THE FAULT OF THE ACCOUNTANT IS NOT SUPPORTED BY ANY EVI DENCE, WHATSOEVER, ON RECORD. ON APPEAL, THOUGH THE ASSESSEE SUBMITTED AN APPLICA TION UNDER RULE 46A OF THE IT RULES,1962,FOR ADMISSION OF ADDITIONAL EVIDENCE , THE LD. CIT(A) REJECTED THE REQUEST FOR ADMISSION OF ADDITIONAL EVIDENCE ON THE GROUND THAT NO CASE HAD BEEN MADE OUT BY THE ASSESSEE THAT HIS CASE FALLS U NDER CLAUSES (B), (C) & (D) OF RULE 46A. NOW WHAT ARE THE REASONS GIVEN IN SUPPO RT OF PRAYER FOR ADMISSION OF ITA N O.604 /DEL./2012 6 ADDITIONAL EVIDENCE AND WHY THE ASSESSEE DID NOT PL ACE CORRECT FACTS IN RELATION TO TURNOVER OF M/S HMC ENTERPRISES BEFORE THE AO , HAS NOT BEEN EXPLAINED BEFORE US. IN THE APPLICATION UNDER RULE 46A IT IS MERELY STATED THAT THE ASSESSEES CASE FALLS UNDER CLAUSES (B),(C) & (D) O F THE RULE 46A.BUT WHAT ARE THE REASONS AND FACTS FOR CLAIMING SO, HAS NOT BEEN EX PLAINED BEFORE US NOR IT IS EVIDENT FROM THE IMPUGNED ORDER. THE LD. AR NOW SUB MITTED BEFORE US THAT REASONS IN SUPPORT OF ADMISSION OF ADDITIONAL EVIDE NCE WERE SAME AS FOR REQUEST FOR ADMISSION OF ADDITIONAL GROUND AND WHEN THE LD. CIT(A) ADMITTED ADDITIONAL GROUND, HE WAS NOT JUSTIFIED IN REJECTING REQUEST F OR ADMISSION OF ADDITIONAL EVIDENCE, PARTICULARLY WHEN THEIR CASE FALLS UNDER CLAUSE (B) OF THE IT RULES,1962.. THIS PLEA OF THE LD. AR NOWHERE APPEAR S TO HAVE BEEN CONSIDERED BY THE LD. CIT(A).. HERE WE MAY HAVE A LOOK AT THE RELEVANT PROVISIONS OF RULE 46A OF THE IT RULES 1962, WHICH READ AS UNDER: (1) THE APPELLANT SHALL NOT BE ENTITLED TO PRODUCE BEFORE THE DEPUTY COMMISSIONER (APPEALS) OR, AS THE CASE MAY BE, THE COMMISSIONER (APPEALS), ANY EVIDENCE, WHETHER ORAL OR DOCUMENTARY, OTHER TH AN THE EVIDENCE PRODUCED BY HIM DURING THE COURSE OF PROCEEDINGS BEFORE THE ASS ESSING OFFICER, EXCEPT IN THE FOLLOWING CIRCUMSTANCES, NAMELY:-- (A) WHERE THE ASSESSING OFFICER HAS REFUSED TO ADMI T 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 RELEVAN T TO ANY GROUND OF APPEAL; OR (D) WHERE THE ASSESSING OFFICER HAS MADE THE ORDER APPEALED AGAINST WITHOUT GIVING SUFFICIENT OPPORTUNITY TO THE APPELLANT TO A DDUCE 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 C OMMISSIONER (APPEALS) RECORDS IN WRITING THE REASONS FOR ITS ADMISSION. (3)THE DEPUTY COMMISSIONER(APPEALS) OR, AS THE CA SE MAY BE, THE COMMISSIONER (APPEALS) SHALL NOT TAKE INTO ACCOUNT ANY EVIDENCE PRODUCED UNDER SUB-RULE (1) UNLESS THE INCOME-TAX OFFICER HA S BEEN ALLOWED A REASONABLE ITA N O.604 /DEL./2012 7 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 WITN ESS 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 EXAMI NATION OF ANY WITNESS, TO ENABLE HIM TO DISPOSE OF THE APPEAL, OR FOR ANY OTH ER SUBSTANTIAL CAUSE INCLUDING THE ENHANCEMENT OF THE ASSESSMENT OR PENALTY (WHETH ER ON HIS 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 SECT ION 271..' 5.1 IT IS EVIDENT FROM THE AFORESAID PROVISIONS THAT THE LD. CIT(A) CAN TAKE INTO ACCOUNT ANY EVIDENCE PRODUCED UNDER SUB-R. (1)(B) & (C) OF RULE 46A OF THE IT RULES, 1962 IF THE ASSESSEE WAS PREVENTED BY SUFF ICIENT CAUSE . IN HAJI LAL MOHD. BIRI WORKS' CASE [2005] 275 ITR 496 (ALL), BY MAKING AN ELABORATE DISCUSSION ON RULE 46A OF THE RULES IN PARAGRAPH 10 AT PAGE 500 AND 501, IT WAS HELD THAT UNDER RULE 46A THE AUTHORITY IS NOT PERMI TTED TO ACT WHIMSICALLY WHILE EXERCISING THE JURISDICTION UNDER IT .IN THE CASE U NDER CONSIDERATION, THE ASSESSEE PLACED BEFORE THE LD. CIT(A),CERTAIN ADDITIONAL EVI DENCE AND ADMITTEDLY, THE SAID DOCUMENTS WERE NOT SUBMITTED BEFORE THE AO. THE POW ERS OF THE CIT(A) IN TERMS OF RULE 46A TO ADMIT FRESH EVIDENCE, ENTAILS AN EL EMENT OF DISCRETION WHICH IS REQUIRED TO BE EXERCISED IN A JUDICIOUS MANNER. THE POWERS OF THE CIT(A) TO ADMIT ADDITIONAL EVIDENCE ARE NOT ONLY IN SITUATION S WHERE THE EVIDENCE COULD NOT BE PRODUCED BEFORE LOWER AUTHORITIES OWING TO LACK OF ADEQUATE OPPORTUNITY BUT ALSO IN SITUATIONS WHERE THE FRESH EVIDENCE WOULD E NABLE THE CIT(A) TO DISPOSE OF THE APPEAL OR FOR ANY OTHER SUBSTANTIAL CAUSE. OF COURSE, THE POWER IS TO BE EXERCISED JUDICIOUSLY AND FOR REASONS TO BE RECORDE D. HERE WE MAY POINT OUT THAT THE HONBLE JURISDICTIONAL HIGH COURT IN CIT VS. MANISH BUILD WELL (P.) LTD.,16 TAXMAN.COM27(DELHI) HELD THAT THAT THE COND ITIONS PRESCRIBED IN RULE 46A MUST BE SHOWN TO EXIST BEFORE ADDITIONAL EVIDEN CE 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 EXE RCISED IN A ROUTINE OR CURSORY MANNER. A DISTINCTION SHOULD BE RECOGNIZED AND MAIN TAINED BETWEEN A CASE ITA N O.604 /DEL./2012 8 WHERE THE ASSESSEE INVOKES RULE 46A TO ADDUCE ADDIT IONAL 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-SEC TION (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 REQUI REMENTS OF THE RULE STRICTLY. THE HONBLE HIGH COURT HELD THAT SUB-RULE (3) OF RU LE 46A INTERDICTS THE CIT (A) FROM TAKING INTO ACCOUNT ANY EVIDENCE PRODUCED FOR THE FIRST TIME BEFORE HIM UNLESS THE ASSESSING OFFICER HAS HAD A REASONABLE O PPORTUNITY OF EXAMINING THE EVIDENCE AND REBUT THE SAME. IN VIEW OF THE FOREGOI NG, ESPECIALLY WHEN THE LD. CIT(A) DID NOT RECORD ANY FINDINGS ON THE PLEA ON B EHALF OF THE ASSESSEE THAT THEIR REQUEST FOR ADMISSION OF ADDITIONAL EVIDENCE WAS COVERED IN EXCEPTION PROVIDED IN CLAUSE (B) OF THE IT RULES,1962 AND THA T THE REASONS FOR ADMISSION OF ADDITIONAL EVIDENCE ARE THE SAME AS WERE ADMISSION OF ADDITIONAL GROUND, IN THE INTEREST OF JUSTICE AND FAIR PLAY, WE VACATE THE F INDINGS OF THE LD. CIT(A) AND RESTORE THE ISSUES RAISED IN VARIOUS GROUNDS OF APP EAL BEFORE US TO HIS FILE, WITH THE DIRECTIONS TO FOLLOW THE MANDATE IN TERMS OF RU LE 46A OF THE IT RULES, 1962 AS ALSO PRINCIPLES OF NATURAL JUSTICE IN THE LIGHT OF OUR AFORESAID OBSERVATIONS AND THEREAFTER, DISPOSE OF THE MATTER IN ACCORDANCE WITH LAW, AFTER ALLOWING SUFFICIENT OPPORTUNITY TO BOTH THE PARTIES. WITH T HESE DIRECTIONS, GROUNDS RAISED IN THE APPEAL ARE DISPOSED OF, AS INDICATED HEREINBEFO RE. 6. NO OTHER PLEA OR ARGUMENT WAS MADE BEFORE US. 7. IN THE RESULT, APPEAL IS ALLOWED BUT FOR ST ATISTICAL PURPOSES. SD/- SD/- (U.B.S. BEDI) (A.N. PAHUJA) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) ORDER PRONOUNCED IN OPEN COURT ITA N O.604 /DEL./2012 9 NS COPY OF THE ORDER FORWARDED TO :- 1. HARISH JOSHI, PROPRIETOR,TECH CREATIONS, 25/11,R AMPURA, NEAR SHRI RAM MANDIR, GANAUR, SONEPAT 2. DY. C.I.T., SONEPAT CIRCLE, SONEPAT. 3. CIT CONCERNED 4. CIT(A), ROHTAK. 5. DR, ITAT,C BENCH, NEW DELHI 6. GUARD FILE. BY ORDER, DEPUTY / ASSTT.REGISTRAR ITAT, DELHI