Vinod Chandratike, Aurangabad V. The Income Tax Officer, Ward-1(5), Aurangabad

ITA 754/PUN/2023

AI Insights

The case involves Vinod Chandratike, the appellant, who challenged the order of the National Faceless Appeal Centre (NFAC) regarding the non-consideration of additional evidence submitted during the appeal process. The additional evidence was intended to support the appellant's claim of having sufficient cash balance prior to cash deposits made into his bank account. The NFAC had not considered these documents due to the absence of a formal application requesting their admission under rule 46A of the Income Tax Rules, 1962. The ITAT found that this technical oversight should not deprive the appellant of the opportunity to substantiate his claims, emphasizing a justice-oriented approach over a strictly technical one.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 136286 (ITAT-PUNE)
• Duration Of Justice: 1 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-08-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 27-07-2023
• Assessment Year: 2013-2014
• Appeal Filed On: 25-06-2023
• Other Referred Cases: Pharmaceuticals ITA No.740/PUN/2023
• Laws Referred To: Income Tax Act, Income Tax Rules, 1962
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Additional evidence; Set aside
• Section: 143(3); 250; 246A

Judgement Text

॥ आयकर अपीलीय न्यायाधिकरण, पुणे “बी” न्यायपीठ, पुणे में ॥ ITAT-Pune Page 1 of 4 IN THE INCOME TAX APPELLATE TRIBUNAL, PUNE “B” BENCH, PUNE BEFORE HON’BLE SHRI S. S. VISWANETHRA RAVI, JUDICIAL MEMBER AND SHRI G. D. PADMAHSHALI, ACCOUNTANT MEMBER आयकर अपऩल सं. / ITA No.754/PUN/2023 निर्धारण वर्ा / Assessment Year : 2013-14 Vinod Chandratike A/p: Galle Borgaon, Tal.: Khultabad Aurangabad-431003. PAN : AWOPC1795L . . . . . . . अपीलार्थी / Appellant बनाम / V/s. Income Tax Officer Ward-1(5), Aurangabad . . . . . . . प्रत्यर्थी / Respondent द्वारा / Appearances Assessee by : Shri P. S. Shingte Revenue by : Shri Abdesh Kumar Jha स ु नवाई की तारीख / Date of conclusive Hearing : 28/07/2023 घोषणा की तारीख / Date of Pronouncement : 04/08/2023 आदेश / ORDER PER G. D. PADMAHSHALI; This appeal is filed u/s 250(1)(aa) of the Income Tax Act [‘the Act’] by the assessee challenging the order of National Faceless Appeal Centre, Delhi [‘NFAC’] DIN & Order ITBA/NFAC/S/250/2023-24/1052350185(1) dt. 26/04/2023 passed u/s 250 of the Act. 2. At the outset of hearing, the Ld. AR adverting to para 8.5 placed at page 14 of the impugned order has submitted that, ‘aggrieved by the order of re- assessment passed u/s 143(3) r.w.s. 263 of the Act, the appellant assessee had filed an appeal before the Ld. NFAC on 22/02/2019. In support of assessee’s claim of having held sufficient cash balance with him prior to cash deposits Rely on Pharmaceuticals ITA No.740/PUN/2023 ITAT-Pune Page 2 of 4 made into his bank account, had filed certain additional evidences u/r 46A of Income Tax Rules, 1962. These additional evidences for the reasons beyond assessee’s control were remained to be submitted during the course of assessment proceedings. Admittedly these additional evidences were filed first time before the Ld. NFAC in an appeal. However through oversight the application seeking admission thereof was remained to be filed therewith. In the absence of a petition/application seeking admission of such additional evidences u/r 46A (supra), the Ld. NFAC adjudicated the matter without reference thereto turning them out of record’. 3. The Ld. AR further contended that, ‘mere technical failure on the part of the assessee to file an application requesting admission of additional evidences u/r 46A should not deprive the assessee from legitimate opportunity to prove his claim. On the other hand, the Ld. DR solidifying the fact of non-consideration of additional evidence filed first time before the Ld. NFAC by the appellant assessee, has vehemently supported the impugned order. Adverting to impugned order the Ld. DR further contending that, ‘the Ld. FAA has rightly dealt with merits of the case otherwise, thus leaving no scope to interfere therewith, for the reasons the present appeal of the appellant deserves dismissal’. 4. Heard rival contentions, perused the material placed on record in light of rule 18 of ITAT-Rules 1963 and observed that, the appellant in order to proof availability of cash balance with him prior to deposits into his bank account had Rely on Pharmaceuticals ITA No.740/PUN/2023 ITAT-Pune Page 3 of 4 brought on record certain key documents which inter-alia included, 7/12 extracts of land, 8A abstract, bank statement. We further note that, these additional documents were filed first time before Ld. NFAC, however remained unsupported with written application seeking admission thereof u/r 46A (supra). These additional evidences in the absence a written application been ostracised by the Ld. NFAC while adjudicating the issue on merits. Ostensibly, non- consideration of these additional evidences has laden the assessee with additional tax liability merely for the reasons of technical failure. 5. We observed that, these evidences were indeed not rejected on any meritorious ground as contemplated u/r 46A(1) (supra), but in the absence of application seeking admission thereof. For this very reason we of the considered view that, consequential adjudication has suffered from principle of natural justice and violative of sub-rule (1) of rule 46A (supra). 6. We note that rule 46A (supra) does not ispo-facto subscribed for separate application for admission of additional evidences. It is worthy to note here that, in terms of sub-rule (2) of rule 46A (supra) it is for the Ld. NFAC to invariably record its reasons for admission of additional evidence. Equally before rejecting to admit the same the first appellate authority before proceeding to adjudicate the matter, in relation to additional evidence brought on record has to record the case does not fall within any of the exception carved out in sub-rule (1) of rule 46A (supra). Rely on Pharmaceuticals ITA No.740/PUN/2023 ITAT-Pune Page 4 of 4 7. We are heedful to state that, while dealing with tax litigation, the Ld. NFAC being a quasi-judicial authority is expected to adopt justice oriented approach rather resorting to iron-cast technical one. Faced with the present situation, we see the first appellate authority has rejected to admit additional evidence on flimsy ground adopting an iron-cast technical approach. In view of this, we have no option but to set aside the whole issue to the file of Ld. NFAC with a direction deal with the additional evidence in the light of rule 46A without the need for any written application. 8. Needless to state that, the Ld. NFAC shall examine the same and decide either to admit or reject u/r 46A (supra) and adjudicate the matter in the manner subscribed by sub-section (6) of section 250 of the Act, which mandates the Ld. FAA to state points for its determination, decision thereon and reason for such decision while disposing of the appeal instituted before it u/s 246A of the Act. 9. Resultantly, the appeal is ALLOWED FOR STATISTICAL PURPOSE. In terms of rule 34 of ITAT Rules, the order pronounced in the open court on this Friday 04 th day of August, 2023. -S/d- -S/d- S. S. VISWANETHRA RAVI G. D. PADMAHSHALI JUDICIAL MEMBER ACCOUNTANT MEMBER प ु णे / PUNE ; ददना ां क / Dated : 04 th day of August, 2023. आदेश की प्रतितिति अग्रेतिि / Copy of the Order forwarded to : 1. अपीलाथी / The Appellant. 2. प्रत्यथी / The Respondent. 3. The CIT(A)-NFAC, Delhi (India) 4. The Concerned CIT (MH-India) 5. DR, ITAT, Bench ‘B’, Pune 6. गार्डफ़ाइल / Guard File. आदेशान ु सार / By Order, वररष्ठ दनजी सदिव / Sr. Private Secretary आयकर अपीलीय न्यायादधकरण, प ु णे / ITAT, Pune.