M/s Saboo Coating Limited, Chandigarh V. Addl. CIT, Chandigarh

ITA 686/CHANDI/2015

• Counselvise Citation: 68621514 RSA 2015
• Duration Of Justice: 2 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-10-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Next Hearing Date: 05-10-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 16-07-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANJIT SINGH
• Assessee Lawyers: ANIL BATRA
• Keywords: Opportunity of being heard; Additional evidence

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH,CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND MS. RANO JAIN, ACCOUNTANT MEMBER ITA NO. 686/CHD/2015 ASSESSMENT YEAR: 2008-09 M/S SABOO COATING LTD., VS THE ADDL. CIT, SCO 212-14, RANGE-1, SECTOR 34-A, CHANDIGARH. CHANDIGARH. PAN: AACCS9993B (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI ANIL BATRA RESPONDENT BY : SHRI MANJIT SINGH DATE OF HEARING : 05.10.2015 DATE OF PRONOUNCEMENT : 07.10.2015 O R D E R PER BHAVNESH SAINI,JM THIS APPEAL BY ASSESSEE IS DIRECTED AGAINST THE ORD ER OF LD. CIT(APPEALS)-I CHANDIGARH DATED 01.05.2015 F OR ASSESSMENT YEAR 2008-09 CHALLENGING THE ADDITION OF RS.6,50,930/- ON ACCOUNT OF UNDER VALUATION OF THE CLOSING STOCK AND THAT THE LD. CIT(APPEALS) HAS ARBITRARILY AND IN UNFAIR MANNER IGNORED THE ADDITIONAL EVIDENCES WHIC H HAVE DIRECT BEARING ON THE METHOD OF VALUATION OF CLOSIN G STOCK. 2. BRIEFLY THE FACTS OF THE CASE ARE THAT THE ASSES SING OFFICER MADE THE ADDITION OF RS.6,50,930/- ON ACCOU NT OF UNDER VALUATION OF CLOSING STOCK. THE ASSESSEE CHA LLENGED THE ADDITION BEFORE LD. CIT(APPEALS) AND ALSO FILED ADDITIONAL EVIDENCE I.E. VALUATION OF FINISHED GOOD S AS PER 2 GP RATIO AS ON 31.03.2008 AND VALUATION OF FINISHED GOODS WHERE THE COST AS PER GP RATIO IS BELOW VALUE OF CL OSING STOCK. THE ASSESSEE REQUESTED FOR ADMISSION OF ADD ITIONAL EVIDENCES UNDER RULE 46A. THE LD. CIT(APPEALS), HOW EVER, NOTED THAT THE ADDITIONAL EVIDENCES ARE NOT RELEVAN T FOR ADJUDICATING THE ISSUE, THE SAME WERE THEREFORE, IG NORED AND ULTIMATELY DISMISSED THE APPEAL OF THE ASSESSEE . 3. AFTER CONSIDERING RIVAL SUBMISSIONS, WE ARE OF T HE VIEW THE MATTER REQUIRES RE-CONSIDERATION AT THE LE VEL OF THE LD. CIT(APPEALS). IN THIS CASE, THE ASSESSING OFFI CER MADE ADDITION ON ACCOUNT OF UNDER VALUATION OF CLOSING S TOCK. THE ASSESSEE FURNISHED THE ADDITIONAL EVIDENCES TO EXPLAIN THAT THERE IS NO UNDER VALUATION OF THE CLOSING TOC K. THE LD. CIT(APPEALS), INSTEAD OF FOLLOWING RULE 46A, HA S SUMMARILY REJECTED THE REQUEST OF ASSESSEE BY HOLDI NG THAT THESE ADDITIONAL EVIDENCES ARE NOT RELEVANT. THE L D. CIT(APPEALS) SHOULD HAVE RECORDED THE REASONS AS TO WHETHER ASSESSEE WAS PREVENTED BY SUFFICIENT CAUSE FROM FILING THESE ADDITIONAL EVIDENCES BEFORE ASSESSING OFFICER AND WHETHER THESE EVIDENCES WERE RELEVANT OR NOT ON THE MERITS OF THE CASE. THE LD. CIT(APPEALS) SHOULD HA VE PASSED THE ORDER IN WRITING EITHER ADMITTING ADDITI ONAL EVIDENCES OR REFUSING TO ADMIT THE ADDITIONAL EVIDE NCES. THE LD. CIT(APPEALS) SHOULD RECORD IN WRITING THE R EASONS FOR ADMISSION OR FOR NON-ADMISSION OF THE ADDITIONA L EVIDENCES AT THE APPELLATE STAGE. NO REASONS HAVE BEEN GIVEN IN THE APPELLATE ORDER HOW THE ADDITIONAL EVI DENCES WERE NOT RELEVANT TO THE MATTER IN ISSUE. 3 4. WE, ACCORDINGLY, SET ASIDE THE ORDER OF LD. CIT(APPEALS) AND RESTORE THIS ISSUE TO HIS FILE WIT H DIRECTION TO RE-DECIDE THE APPLICATION OF THE ASSES SEE UNDER RULE 46A OF THE IT RULES IN ACCORDANCE WITH LAW AND HE SHALL PASS A SPECIFIC AND REASONED ORDER IN WRITING FOR ADMISSION OF THE ADDITIONAL EVIDENCES AND THEREAFTE R, SHALL DECIDE THE APPEAL OF THE ASSESSEE ON MERITS STRICTL Y IN ACCORDANCE WITH LAW. THE LD. CIT(APPEALS) SHALL GI VE REASONABLE SUFFICIENT OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 5. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (RANO JAIN) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEM BER DATED 7 TH OCT., 2015. POONAM COPY TO: THE APPELLANT, THE RESPONDENT, THE CIT(A), THE CIT,DR ASSISTANT REGISTRAR, ITAT/CHD