EMKAY Industries Ltd. vs Commissioner of Income Tax

Adarsh Kumar Goel, J.—This appeal has been preferred by the assessee u/s 260A of the Income Tax Act, 1961 (the Act) against the orders of ITAT Amritsar Bench in I.T.A. No. 428 (ASR.) 2008, dated 8-10-2008 for assessment year 2004-05, proposing to raise following substantial questions of law:

(1) Whether ITAT was justified in setting aside the issues to the file of Commissioner (Appeals)without appreciating the findings of Commissioner (Appeals) on record in addition to facts and evidences and also being a final fact finding body and that too without giving reasonable opportunity to the appellant by denying hearing on the first ad journment application by the counsel that too under unavoidable circum stances?"

(2) Whether the ITAT was not justified in setting aside the issues to the file of Commissioner (Appeals) against the established Principles of Law that no one should be allowed to play second innings and that too without going into merits of the case, it being a last fact finding body and, thus, order of ITAT being perverse needs to be set aside?

(3) Whether under the facts and circumstances of the present case finding of...the ITAT in not considering the present case in its true prospective is perverse and, thus, bad in law?

(4) Whether under the facts and circumstances of the case and in view of the specific finding of Commissioner (Appeals) that the provisions of Sections 68,69,69A, 69B, 69C and 69D are not applicable at all to the facts of the present case since the assessee himself has declared the amount of commission received as income, the orders of the ITAT setting aside to the file of Commissioner (Appeals) for re-examining the additional evidence is perverse and bad in law?

The assessing officer during the course of assessment made certain additions u/s 68 of the Act holding that the assessee had failed to establish the identity, genuineness and creditworthiness of the transactions. In the course of appellate proceedings, the assessee furnished additional evidence in the form of confirmation letters which were forwarded to the assessing officer. The assessing officer sought time for verification but failed to send his report. The Commissioner (Appeals) allowed the appeal of the assessee by accepting additional evidence.

On appeal by the revenue to the Tribunal, it was held that Commissioner (Appeals) should have awaited the opinion of the assessing officer or should have conducted inquiry himself as provided u/s 250(4) of the Act. The Tribunal remitted the matter for fresh decision. The conclusion of the Tribunal is as under :

Hence, in our opinion, it would have been better, if the learned Commissioner(Appeals) would have directed the assessing officer to examine the parties in accordance with law to establish the identity, genuineness and creditworthiness of those parties and thereupon decide the issue since the detailed enquiry is required, was not carried out. Since the work is not properly entrusted to the assessing officer and Commissioner (Appeals) is doing it all by himself, the learned Commissioner (Appeals) would have been justified, if he had got the evidence verified by the assessing officer which he failed to do so. Hence, in the interest of justice, we set aside the issue to the file of the Commissioner (Appeals) and direct the assessing officer to send remand report after duly examining the concerned parties.

Since we have set aside the issue to the file of the learned Commissioner (Appeals) we refrain from going to the merits of the case.

We have heard learned Counsel for the appellant. He submits that the Commissioner (Appeals) had analysed the additional evidence properly and in such a situation, remand by the Tribunal is uncalled for.

The Tribunal has merely remanded the matter with the finding that the Commissioner (Appeals) had not fully enquired into the matter. In the impugned order, option has been left to the Commissioner (Appeals) to either look into the matter himself or to have a verification done from the assessing officer. No prejudice is caused to the appellant. View taken by the Tribunal is a possible view. No substantial question of law arises.

The appeal is dismissed.