Income Tax Appellate Tribunal - Rajkot
Jayvantsinh N. Vaghela,, ... vs The Income Tax Officer, Ward-2,, ... on 3 October, 2018
आयकर अपील य अ
धकरण, राजकोट यायपीठ, राजकोट ।
IN THE INCOME TAX APPELLATE TRIBUNAL
RAJKOT BENCH, RAJKOT
LkoZJh olhe vgen
vgen]] ys[kk lnL; ,o Ek/
Ek/kqkqferk jkW;] U;kf
U;kf;d
kf;d lnL; ds le{kA
BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER
And SMT MADHUMITA ROY, JUDICIAL MEMBER
Misc. Application No.13/Rjt/2014
And
आयकर अपील सं./I.T.A.No. 584/Rjt/2012
( नधा रण वष / Assessment Year : 2009-10)
Jayvantsinh Natubha बनाम/ The Income Tax Officer,
Vaghela, Vs. Ward - 2,
Shahibaug Society, Surendranagar.
Block No.5,
Surendranagar : 363 002.
थायी ले खा सं . /जीआइआर सं . / PAN/GIR No. : AAPPV 2230 G
(अपीलाथ /Appellant) .. ( यथ / Respondent)
अपीलाथ ओर से/ Appellant by : Shri Chetan Agarwal, A.R.
यथ क! ओर से/Respondent by: Shri Praveen Verma, Sr. D.R.
ु वाई क! तार ख/
सन Date of Heari ng 30/08/2018
घोषणा क! तार ख /Date of Pronounce ment 03/10/2018
आदे श / O R D E R
PER WASEEM AHMED, ACCOUNTANT MEMBER:
The captioned Miscellaneous Application and ITA No.584/Rjt/2012 have been filed at the instance of the assessee against the order of the Commissioner of Income Tax(Appeal)-XVI, Ahmedabad [CIT(A) in short] vide appeal no.CIT(A)-XVI/ITO.Wd.2/SNR/619/11-12 dated 28-08-2012 arising in the matter of assessment order passed under s.143(3) of the Income Tax Act, 1961(here-in-after referred to as "the Act") dated 28-12-2011 relevant to Assessment Year (AY) 2009-10.
MA No.13/Rjt/2014 & ITA No.584/Rjt/2012 Shri Jayvantisinh Nathubhai Vaghela A.Y. 2009-10 -2-
2. The assessee in this Misc. Application is pleading to recall the order of the Hon'ble Tribunal in ITA No. 584/Rjt/2012 dated 19-04-2013 due to non-adjudication of the additional ground raised before the Tribunal inadvertently.
3. The assessee before us submitted as under:
"(1) The appellant has been served with order passed for A.Y. 2009-
10 by the Appellate Tribunal Rajkot Bench, Rajkot where the appeal of applicant has been partly allowed.
(2.1) Briefly stated the facts of the case are that the assessee had filed the return of income declaring total income at Rs. 4,76,121/-. The assessment had been finalized determining the total income at Rs.62,71,850/- u/s 143(3) of the I.T. Act. Thus the addition was made of Rs. 57,95,727/-. The assessee had preferred appeal against this order.
(2.2) The aforesaid appeal has been disposed off partly allowing reduction of Rs.20,000/- merely by the Hon'ble CIT(A) vide his appellate order Appeal No. CIT(A)-XVI/ITO/WD-2/SNN/619/11- 12 dated 28-08-2012. The Hon'ble CIT(A) had not admitted the additional evidences though the appellant had made request application to entertain the additional evidences vide request dated 21-08-2012. However, the Hon'ble CIT(A) had concluded at 2.5 of his appellate order holding that the assessee does not deserve any view & additional evidences so furnished are rejected at appellate stage.
(2.3) The appellant had preferred appeal before the Hon'ble Tribunal against the CIT(A)'s order. The Tribunal had disposed off appeal vide its order ITA No. 584/RJT/2012 dated 19-04-2013. The Hon'ble Tribunal had through oversight not given any finding on issue of entertainment of additional ground and confirmed major addition of Rs. 45,20,000/- u/s 69 and disallowance of Rs.8,69,727/- being bad debts & discount expenses. (2.4) Thereafter, the appellant had preferred appeal before the Hon'ble Gujarat H.C. The Hon'ble Gujarat H.C. has disposed off the appeal vide its order Tax Appeal No. 784 of 2013. The Hon'ble Gujarat H.C. has held as under: " After some MA No.13/Rjt/2014 & ITA No.584/Rjt/2012 Shri Jayvantisinh Nathubhai Vaghela A.Y. 2009-10 -3- discussion, learned counsel Shri Tushar Hemani for the appellant confined his grievance in the present tax appeal to the question of the tribunal not considering the ground though raised. of CIT(Appeals) having rejected the prayer of appellant for additional evidence.
If that be so, it would be open for the appellant to approach the tribunal with a rectification application."
(3) In the above circumstances, this Misc. Application is filed before your honour Sirs. Therefore, it is humbly requested to rectify the above mistake which is apparent on record and oblige."
4. The ld. AR accordingly submitted that the assessee has filed additional ground of appeal before the Hon'ble ITAT vide dated 23-10- 2012 along with the submission dated 14-12-2012. The additional ground of appeal and its submissions are placed on pages 1 and 2 of the paper book, which reads as under:
Additional Ground of appeal:
"Ld. AO erred in law as well as on fact in making addition of Rs.45,20,000 u/s.69 in respect of investment in property made from bank account no. 4050002100003386 duly disclosed in books of accounts and sourced from contract receipts as evident from bank account itself."
Submission apropose to Additional Ground of appeal:
"1. APPELLANT HAD MADE INVESTMENT IN PROPETY OF Rs.45,20,000. It was submitted to lower authorities that same was made out of booking deposits obtained from twenty persons, which was not accepted.
2. On verification of records while filing appeal before hon. ITAT, it was noticed that said investment was made from bank account no. 4050002100003386 duly reflected in books of accounts and sourced from contract receipts credited in said bank account. Thus, submission made before lower authorities was factually wrong.
MA No.13/Rjt/2014 & ITA No.584/Rjt/2012 Shri Jayvantisinh Nathubhai Vaghela A.Y. 2009-10 -4-
3. Since this being factual error, same goes to root of the matter, hence we request your honours to admit additional ground of appeal and additional evidences in the form of bank account and also request your honours to set aside matter for verification to AO.
4. We enclose herewith copies of cheques and bank statement for your honours perusal."
4.1 The ld AR also submitted that the additional evidences were also filed before the ld CIT(A) for justifying the investment in the immovable property amounting to Rs.45,20,000/-. However, the ld. CIT(A) did not admit the additional evidences on the ground that the assessee was given sufficient opportunity during the assessment proceedings and there was also no violation of Rule 46A of Income Tax Rule.
4.2 The ld AR for the assessee drew our attention on the additional documents, which are placed on pages 32-166 of the paper book.
4.3 In view of above, the ld. Counsel for the assessee prayed before us to recall the order of the Hon'ble ITAT for the limited purpose of the adjudication of additional ground of appeal raised during the appellate proceedings.
5. On the other hand, the ld. DR before us submitted that the Hon'ble ITAT has passed the speaking order after considering original grounds of appeal filed along with the memo of appeal. Therefore, there were no mistake apparent from record and accordingly order of Hon'ble ITAT cannot be recalled.
MA No.13/Rjt/2014 & ITA No.584/Rjt/2012 Shri Jayvantisinh Nathubhai Vaghela A.Y. 2009-10 -5- 5.1 The ld. DR vehemently supported the order of Hon'ble ITAT.
6. We have heard the rival contentions and perused the materials available on record. The issue in the instant case relates to the addition made by the AO for the investment in the property made by the assessee amounting to Rs. 45,20,000/-. The AO during assessment proceedings has given several opportunities to the assessee to justify the source of investment made in the property but the assessee failed to avail the same. Accordingly the assessee failed to furnish the requisite details as desired by the AO. Therefore, the addition was made by the AO.
7. The assessee indeed filed various additional documents before the ld. CIT(A) but the same were not admitted as there was no violation of Rule 46A of Income Tax Rule. However, the ld. CIT(A) even after rejecting the additional documents filed by the assessee also disbelieved the details for the source of investment filed by the assessee during the appellate proceedings.
However, the assessee before the Hon'ble ITAT has filed additional grounds as well as additional evidences as discussed above. There was no whisper in the order of Hon'ble ITAT about the additional ground of appeal as well as additional evidence filed by the assessee. There is no ambiguity that the additional grounds as well as additional evidences can be admitted by the Hon'ble ITAT at its discretion after considering the facts of the case.
MA No.13/Rjt/2014 & ITA No.584/Rjt/2012 Shri Jayvantisinh Nathubhai Vaghela A.Y. 2009-10 -6- However, it was the duty of the Hon'ble ITAT either to admit or to reject the additional evidences filed by the assessee but on perusal of the order of Hon'ble ITAT we note that there is no whisper and mention regarding the additional ground and evidences filed by the assessee.
8. In our considered view non consideration of the additional evidences filed by the assessee amounts to mistake apparent from record. In this regard, we find support and guidance from the judgment of Hon'ble Supreme Court in the case of Jytosana Suri Vs. ITAT Reported in 128 Taxman 33, wherein it was also held as under:
"The pending application under rule 29 of the ITAT Rules, was required to be disposed of first, before the Tribunal heard the appeal on merits. The appellant had undertaken to withdraw the pending application before the Tribunal for making a reference under section 256(1) for the above purpose. In view thereof, it was to be directed that the Tribunal should first dispose of the application under rule 29 on merits and thereafter proceed to dispose of the appeal. The matter was to be remitted to the Tribunal for disposal."
8.1 From the above, it is clear that there is an apparent mistake crept in the order of Hon'ble ITAT inadvertently. Therefore, we are inclined to recall the order of ITAT for the limited purpose of the adjudication of the additional ground of appeal filed by the assessee during the appellate proceedings. Hence, Misc Application is allowed.
9. Further the ld. AR before us prayed to hear the matter on merit for the issue raised in the additional ground of appeal. The point of contention of the ld. AR was that the issue raised in the additional ground MA No.13/Rjt/2014 & ITA No.584/Rjt/2012 Shri Jayvantisinh Nathubhai Vaghela A.Y. 2009-10 -7- of appeal needs to be remitted back for fresh adjudication to the file of AO in the light of the additional evidences.
10. The ld. DR did not object if the matter is to be heard on merit for the issue raised in the additional ground of appeal.
11. In view of above, we decided to proceed to hear the matter raised in the additional ground of appeal on merit.
Now coming to ITA No.548/Rjt/2012. The assessee raised the following additional ground of appeal:
1. The Hon'ble CIT(A)-XVI, Ahmedabad has erred in law and on facts in confirming the addition of Rs. 57,75,727/- out of total addition made of Rs. 57,95,727/- as against returned income of Rs. 4,76,121/-.
2. The Hon'ble CIT(A) has also erred in law and on facts in not considering the additional evidences which have been furnished to him during the course of appellate proceedings and he has even not remanded the case to the Ld, A.O. for his opinion & simply rejected the contentions of the appellant. Thus he has also failed to give the justice and so there is breach of law of natural justice.
3. The Hon'ble CIT(A) has also erred in law and on facts in confirming the addition of Rs. 45,20,000/- u/s 69 treating the investment as unexplained as against the details furnished were not considered sufficient to establish the investment. The appellant has also furnished the additional evidences which have also not been considered properly.
4. The Hon'ble CIT(A) has also erred in law and on facts in not allowing the Discount Exps. (which was granted to Government concerns) of Rs. 8,69,727/- which has been considered by the appellant as bad debts.
MA No.13/Rjt/2014 & ITA No.584/Rjt/2012 Shri Jayvantisinh Nathubhai Vaghela A.Y. 2009-10 -8-
5. Hon'ble CIT(A) has also erred in law & on facts in confirming the addition of Rs.1,00,000/- made by the Ld. A.O. for want of check of expenses without specifying any particular defects.
6. The Hon'ble CIT(A) has also erred in law & on facts in confirming the disallowance of Rs. 5,000/- on account of certain expenses were not supported by evidences.
7. The Hon'ble CIT(A) has also erred in law & on facts in not deleting the total disallowance of Rs. 50,000/- and only has given relief of Rs. 20,000/-.
8. Any other ground of appeal, which may be taken at the time of hearing with the kind 1 previous approval of the Hon'ble I.T.A.T, Bench, Rajkot."
12. The ld. AR at the time of hearing brought to our notice that the additional ground of appeal was raised before the ITAT along with the additional evidence but the same not adjudicated inadvertently.
12.1 The ld. AR further submitted that the additional ground needs to be adjudicated in the light fresh evidences filed before the Hon'ble ITAT. Therefore it was prayed before us to remit the matter back to the file of AO for the fresh adjudication after considering the additional evidences filed during the appellate proceedings.
13. The ld. DR has not raised any adjudication if the matter is remitted back to the file of AO for fresh adjudication.
14. Heard both the parties and perused the materials available on record. At this juncture, we find relevant in hand to important to reproduce the provision of Rule 11 of Income Tax Appellate Tribunal Rules 1963, which reads as under:
MA No.13/Rjt/2014 & ITA No.584/Rjt/2012 Shri Jayvantisinh Nathubhai Vaghela A.Y. 2009-10 -9- "Grounds which may be taken in appeal.
11. The appellant shall not, except by leave of the Tribunal, urge or be heard in support of any ground not set forth in the memorandum of appeal, but the Tribunal, in deciding the appeal, shall not be confined to the grounds set forth in the memorandum of appeal or taken by leave of the Tribunal under this rule :
Provided that the Tribunal shall not rest its decision on any other ground unless the party who may be affected thereby has had a sufficient opportunity of being heard on that ground."
14.1 From the above provisions, we note that the ITAT has been empowered to admit the additional grounds of appeal of the assessee after considering the relevant facts. In the case before us, the issue has arisen from the order of lower authorities. Both the lower authorities have confirmed the addition on account of investment in the immovable property.
15. Now the first issue arises whether to admit the additional ground of appeal raised by the assessee. As we have already held that the issue raised in the additional grounds of appeal is arising from the order of lower authorities and no new facts regarding the issue needs to be brought on record. Therefore, we are inclined to admit the additional ground of appeal raised by the assessee after having reliance on the judgment of Hon'ble Supreme Court in the case of Jute Corporation of India Vs. CIT reported in 53 Taxman 85 wherein it was held as under:
"The Act does not contain any express provision debarring an assessee from raising an additional ground in appeal and there is no provision in the Act placing restriction on the power of the appellate authority in entertaining an additional ground in appeal. In the absense of any statutory provision, the general principle relating to the amplitude of MA No.13/Rjt/2014 & ITA No.584/Rjt/2012 Shri Jayvantisinh Nathubhai Vaghela A.Y. 2009-10
- 10 -
appellate authority's power being co-terminus with that of the initial authority should normally be applicable. If the tax liability of the assessee is admitted and if the ITO is afforded opportunity of hearing by the appellate authority in allowing the assessee's claim for deduction on the settled view of law, there appears to be no good reason to curtail the powers of the appellate authority under section 251(1)(a). Even otherwise an appellate authority while hearing appeal against the order of subordinate authority has all the powers which the original authority may have in deciding the question before it subject to the restrictions or limitations, if any, prescribed by the statutory provisions. In the absence of any statutory provision the appellate authority is vested with all the plenary powers which the subordinate authority may have in the matter. There appeared to be no good reason to justify curtailment of the power of the AAC in entertaining an additional ground raised by the assessee in seeking modification of the order of assessment passed by the ITO. There may be several factors justifying raising of such new plea in appeal, and each case has to be considered on its own facts. If the AAC is satisfied he would be acting within his jurisdiction in considering the question so raised in all its aspects. Of course, while permitting the assessee to raise an additional ground, the AAC should exercise his discretion in accordance with law and reason. He must be satisfied that the ground raised was bona fide and that the same could not have been raised earlier for good reasons. The satisfaction of the AAC depends upon the facts and circumstances of each case and no rigid principles or any hard and fast rule can be laid down for this purpose."
16. We also find support and guidance from the judgment of Hon'ble Madhya Pradesh in the case of Meghji Girdhar (HUF) Vs. CWT reported in 20 taxmann.com 744 wherein it was held as under:
"Held that no order was passed by the Tribunal granting leave to the revenue to urge this additional ground which was not set out in the memo of appeal. The assessee had also objected to raising of this new plea at hearing stage. Therefore, in terms of proviso to rule 11 of Rules, 1963, the assessee had not been given adequate opportunity of being heard on that ground. Thus, the Tribunal was not right in considering and adjudicating upon new factual plea raised for the first time before it. When for all the prior intervening and subsequent years up to 2000- 01 the version of assessee that he had entrusted 142 kgs. of gold to 'GH' had been accepted, then it furnished an additional reason for holding MA No.13/Rjt/2014 & ITA No.584/Rjt/2012 Shri Jayvantisinh Nathubhai Vaghela A.Y. 2009-10
- 11 -
that the Tribunal should not have allowed the revenue to challenge the version of the assessee in respect of the entrustment of gold for the first time before the Tribunal for the assessment years in question."
16.1 In view of above, we have no hesitation in admitting the additional ground of appeal of the assessee. As the assessee in support of his additional grounds of appeal has filed the additional evidences, which are placed on pages 5 to 11 which need to be considered by the AO. Accordingly, we restore the issue to the file of AO for fresh adjudication in accordance to the provisions of law. Hence, the ground of appeal of the assessee is allowed for statistical purposes.
17. In the result Misc. Application of the assessee is allowed and Appeal of the assessee is allowed for statistical purposes.
This Order pronounced in Open Court on 03/10/2018
Sd/- Sd/-
¼e/kqferk jkW;½ ¼olhe vgen½
U;kf;d lnL; Yks[kk lnL;
(MADHUMITA ROY) (WASEEM AHMED)
JUDICIAL MEMBER ACCOUNTANT MEMBER
Ahmedabad; Dated 03/10/2018
Priti Yadav, Sr.PS
MA No.13/Rjt/2014 & ITA No.584/Rjt/2012
Shri Jayvantisinh Nathubhai Vaghela
A.Y. 2009-10
- 12 -
आदे श क त ल प अ े षत/Copy of the Order forwarded to :
1. अपीलाथ / The Appellant
2. यथ / The Respondent.
3. संबं
धत आयकर आयु,त / Concerned CIT
4. आयकर आय,
ु त(अपील) / The CIT(A)-XVI, Ahmedabad.
5. /वभागीय 2त2न
ध, आयकर अपील य अ
धकरण, अहमदाबाद / DR, ITAT, Ahmedabad.
6. गाड7 फाईल / Guard file.
आदे शानुसार/BY ORDER,
स या/पत 2त //True Copy//
उप/सहायक पंजीकार (Dy./Asstt.Registrar)
आयकर अपील%य अ&धकरण, अहमदाबाद / ITAT, Ahmedabad
1. Date of dictation 05/08/2018(dictation pages 5 )
2. Date on which the typed draft is placed before the Dictating Member 19/08/2018
3. Other Member...
4. Date on which the approved draft comes to the Sr.P.S./P.S ...01/10/2018
5. Date on which the fair order is placed before the Dictating Member for pronouncement...
6. Date on which the fair order comes back to the Sr.P.S./P.S.......
7. Date on which the file goes to the Bench Clerk.....................
8. Date on which the file goes to the Head Clerk..........................................
9. The date on which the file goes to the Assistant Registrar for signature on the order..........................
10. Date of Despatch of the Order..................