As per the natural justice AO must be given opportunity to rebut the claim in pursuance of fresh evidence produced before him

Last updated: 28 December 2011

Court :
INCOME TAX APPELLATE TRIBUNAL

Brief :
That, on the facts and circumstances of the case, the Ld. C.I.T.(A) has erred in law in accepting fresh evidences filed by the assessee without calling for remand report from the AO, which is in contravention of the provision of Rule 46.” Same common issues are for the assessment year 2002-03, which are in grounds No. 5 and 6 of the grounds of appeal. For the purpose of discussion, we will take up the appeal for assessment year 2001-02 on these common issues. The ld. A.O. for the assessment year 2001-02 after examining the bank account and statements furnished before him found that the assessee disclosed Rs. 1 crore Inter Corporate Deposit (ICD) in its account, whereas balance sheet showed only Rs. 50,00,000/- ICD on 31/3/2001. The receipt of Rs.50 lakhs could not be identified by the bank but clearly shows that the said amount was received from an account of Uco Bank bearing A/c. No.028112 and Cheque No. 260378. The ld. A.O. disbelieved the assessee’s contention. In that case, as explained by the assessee, the cheques received from another party should have been shown as outstanding balance as payable. The ld. A.O. found that no such liability has been disclosed in the balance sheet. He, therefore, came to the conclusion that this sum of Rs.50 lakhs is the undisclosed investment which was added to the assessee’s total income. By the same way for assessment year 2002- 03, the ld. A.O. added Rs.41,50,000/- as undisclosed investment.

Citation :
Income-tax Officer, Ward-4(2), Kolkata.(APPELLANT) Versus North East Enterprises (P) Ltd.,Kolkata. (PAN-AAACN8503E)(RESPONDENT)