1 In High Court of Judicature at Madras Dated : 28.11.2017 Coram : Honourable Mr.Justice T.S.SIVAGNANAM and Honourable Mr.Justice M.SUNDAR Tax Case Appeal No.528 of 2017 Principal Commissioner of Income Tax I, No.63, Race Course Road, Coimbatore. ...Appellant Vs Shri.R.Elangovan ...Respondent APPEAL under Section 260A of Income Tax Act, 1961 against against order of Income Tax Appellate Tribunal Madras 'A' Bench dated 26.10.2016 in ITA No.878/Mds/2016. For Appellant : Mr.T.R.Senthil Kumar Judgment was delivered by T.S.SIVAGNANAM,J This appeal is directed against order passed by Income Tax Appellate Tribunal, Madras 'A' Bench in ITA.No.878/Mds/2016 dated 26.10.2016. 2. above appeal has been filed raising following substantial questions of law : http://www.judis.nic.in 2 "i. Whether Appellate Tribunal is justified in confirming finding of Commissioner of Income Tax (Appeals) that there is no on-money paid by assessee as proved with corroborative evidence, which is contrary to statement recorded under Section 132(4) of Income Tax Act and same is not retracted by respondent - assessee ? and ii. Whether Income Tax Appellate Tribunal erred in confirming finding of Commissioner of Income Tax (Appeals), which was rendered in violation of Rule 46A, by admitting additional evidence for first time ?" 3. Before we examine questions raised are substantial questions of law, it may be necessary to take note of following facts : 4. Revenue was on appeal before Tribunal against deletion of addition of Rs.7.02 Crores made by Assessing Officer under Section 69B of Income Tax Act, 1961. search was conducted under Section 132 of said Act in assessee's case on 14.12.2012, during which, it was found that assessee purchased M/s.PSP Steels (P) Ltd. for consideration of Rs.22 Crores. assessee was asked to explain source of payment of Rs.22 Crores. assessee explained that his company M/s.Sastha Steels (P) Ltd. purchased M/s.PSP Steels (P) Ltd. purchase included land, building and machinery belonged to M/s.PSP Steels (P) Ltd. and land adjacent to industry, belonged to one Mrs.P.Dhanalakshmi. registered value of land and building was Rs.2.5 Crores and value http://www.judis.nic.in 3 of land purchased from said Mrs.P.Dhanalakshmi was Rs.98 lakhs, which, according to assessee, were accounted for in books of accounts of M/s.Sastha Steels (P) Ltd., for Rs.14.98 Crores. 5. statement was recorded from respondent on 14.12.2014 wherein he had admitted that sum of Rs.7.02 Crores was unaccounted investment in purchase of M/s.PSP Steels (P) Ltd. During assessment proceedings, assessee explained that out of consideration of Rs.22 Crores, amount of Rs.19 Crores was paid by way of cheques and Rs.3 Crores by way of cash. However, Assessing Officer was of opinion that this statement is retraction of earlier statement made by assessee without corroborative evidence and given after considerable lapse of time, confirmed addition and concluded assessment by passing order dated 13.8.2014. 6. assessee carried matter on appeal to Commissioner of Income Tax (Appeals). Before Commissioner of Income Tax (Appeals), assessee filed detailed written submissions to demonstrate that out of Rs.22 Crores, sum of Rs.19 Crores was paid through banking channels. Assessing Officer appears to have participated in hearing of appeal petition as could be seen from order passed by Commissioner of Income Tax (Appeals) dated 16.11.2015 wherein Assessing Officer also submitted written observations, which have been extracted verbatim in order passed by Commissioner of Income Tax (Appeals). After examining http://www.judis.nic.in 4 evidence placed before Commissioner of Income Tax (Appeals), it was concluded that there was no ground for making addition of Rs.7.02 Crores and that same has not been substantiated and therefore, it was directed to be deleted. 7. Against order passed by Commissioner of Income Tax (Appeals), Revenue filed appeal before Tribunal. Ultimately, Tribunal found that assessee purchased M/s.PSP Steels (P) Ltd. for Rs.22 Crores, out of which, sum of Rs.19 Crores was paid through banking channels, which was not disputed by Department. Thus, this fact having not been disputed and controverted and date-wise payment made by assessee not being controverted, appeal filed by Revenue was dismissed by Tribunal, as against which, Revenue is on further appeal before this Court. 8. learned Senior Standing Counsel has referred to Rule 46A of Income Tax Rules, 1962 and submits that Commissioner of Income Tax (Appeals) failed to follow procedure stipulated in said Rule, when additional evidence was placed before Commissioner of Income Tax (Appeals), which was not available before Assessing Officer. 9. We find from contentions raised before Tribunal that Revenue did not plead that there was violation of Rule 46A of said Rules in matter of production of additional evidence before Commissioner of Income Tax (Appeals). We have noticed that Assessing Officer http://www.judis.nic.in 5 participated in appeal proceedings and his observations were also taken note of by Commissioner of Income Tax (Appeals). Thus, we find that contention that there has been infraction of Rule 46A of said Rules was never pleaded by Revenue either before Commissioner of Income Tax (Appeals) or before Tribunal. Accordingly, we find that no question of law, much less, any substantial question of law arises for consideration in this appeal. 10. In result, above tax case appeal is dismissed. (T.S.S.J.) (M.S.J.) 28.11.2017 Speaking (or) Non Speaking Order Index : Yes (or) No Internet : Yes (or) No To Income Tax Appellate Tribunal Madras 'A' Bench. RS http://www.judis.nic.in 6 T.S.SIVAGNANAM,J AND M.SUNDAR,J RS TCA.No.528 of 2017 28.11.2017 http://www.judis.nic.in Principal Commissioner of Income-tax I, Coimbatore v. R. Elangovan