Ita/259/2019 Of Hillwood Imports And Exports (P) Ltd v. Commissioner Of Income Tax

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE S.V.BHATTI & THE HONOURABLE MR.JUSTICE BASANT BALAJI THURSDAY, THE 13 DAY OF OCTOBER 2022 / 21ST ASWINA, 1944 ITA NO. 247 OF 2019 AGAINST THE ORDER IN 448/COCH/2018 OF I.T.A.TRIBUNAL, COCHIN BENCH APPELLANT: HILLWOOD IMPORTS AND EXPORTS (P) LTD CHUNGAM, FEROKE, CALICUT. BY ADVS. P.RAGHUNATH SRI.PREMJIT NAGENDRAN RESPONDENT: COMMISSIONER OF INCOME TAX CENTRAL CIRCLE, KOCHI-682 013 BY ADVS. SRI.P.K.RAVINDRANATHA MENON (SR.) SRI.JOSE JOSEPH, SC, FOR INCOME TAX THIS INCOME TAX APPEAL HAVING COME UP FOR ADMISSION ON 13.10.2022, ALONG WITH ITA.255/2019, 259/2019 AND CONNECTED CASES, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ITA Nos.247/2019, 255/2019, 259/2019, 256/2019, 260/2019, 258/2019, 10/2020, 3/2020, 13/2020, 4/2020, 8/2020, 11/2020, 12/2020, 16/2020 IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE S.V.BHATTI & THE HONOURABLE MR.JUSTICE BASANT BALAJI THURSDAY, THE 13 DAY OF OCTOBER 2022 / 21ST ASWINA, 1944 ITA NO. 255 OF 2019 AGAINST THE ORDER ITA 450/COCH/2018 OF I.T.A.TRIBUNAL, COCHIN BENCH APPELLANT: HILLWOOD IMPORTS AND EXPORTS (P) LTD. CHUNGAM, FEROKE, CALICUT. BY ADVS.P.RAGHUNATH SRI.PREMJIT NAGENDRAN RESPONDENT: COMMISSIONER OF INCOME TAX CENTRAL CIRCLE, KOCHI-682 013 BY ADV. SRI.P.K.RAVINDRANATHA MENON (SR.) THIS INCOME TAX APPEAL HAVING COME UP FOR ADMISSION ON 13.10.2022, ALONG WITH ITA.247/2019 AND CONNECTED CASES, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE S.V.BHATTI & THE HONOURABLE MR.JUSTICE BASANT BALAJI THURSDAY, THE 13 DAY OF OCTOBER 2022 / 21ST ASWINA, 1944 ITA NO. 259 OF 2019 AGAINST THE ORDER IN ITA 449/COCH/2018 OF I.T.A.TRIBUNAL,COCHIN BENCH APPELLANT/APPELLANT/APPELLANT/ASSESSEE: HILLWOOD IMPORTS AND EXPORTS PVT. LTD. CHUNGAM, FEROKE, CALICUT BY ADVS.P.RAGHUNATH SRI.PREMJIT NAGENDRAN RESPONDENT/RESPONDENT/RESPONDENT/REVENUE COMMISSIONER OF INCOME TAX KOCHI-682013 BY ADVS.SRI.P.K.RAVINDRANATHA MENON (SR.) SRI.JOSE JOSEPH, SC, FOR INCOME TAX THIS INCOME TAX APPEAL HAVING COME UP FOR ADMISSION ON 13.10.2022, ALONG WITH ITA.247/2019 AND CONNECTED CASES, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: -4- IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE S.V.BHATTI & THE HONOURABLE MR.JUSTICE BASANT BALAJI THURSDAY, THE 13 DAY OF OCTOBER 2022 / 21ST ASWINA, 1944 ITA NO. 256 OF 2019 AGAINST THE ORDER IN ITA 451/COCH/2018 OF I.T.A.TRIBUNAL,COCHIN BENCH APPELLANT: HILLWOOD IMPORTS AND EXPORTS PVT. LTD CHUNGAM, FEROKE, CALICUT. BY ADVS.P.RAGHUNATH SRI.PREMJIT NAGENDRAN RESPONDENT: COMMISSIONER OF INCOME TAX KOCHI-682013 BY ADVS.SRI.P.K.RAVINDRANATHA MENON (SR.) SRI.JOSE JOSEPH, SC, FOR INCOME TAX THIS INCOME TAX APPEAL HAVING COME UP FOR ADMISSION ON 13.10.2022, ALONG WITH ITA.247/2019 AND CONNECTED CASES, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ITA Nos.247/2019, 255/2019, 259/2019, 256/2019, 260/2019, 258/2019, 10/2020, 3/2020, 13/2020, 4/2020, 8/2020, 11/2020, 12/2020, 16/2020 IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE S.V.BHATTI & THE HONOURABLE MR.JUSTICE BASANT BALAJI THURSDAY, THE 13 DAY OF OCTOBER 2022 / 21ST ASWINA, 1944 ITA NO. 260 OF 2019 AGAINST THE ORDER IN ITA 452/COCH/2018 OF I.T.A.TRIBUNAL,COCHIN BENCH APPELLANT: HILLWOOD IMPORTS AND EXPORTS PVT. LIMITED CHUNGAM. FEROKE CALICUT. BY ADVS.P.RAGHUNATH SRI.PREMJIT NAGENDRAN RESPONDENT: COMMISSIONER OF INCOME TAX CENTRAL CIRCLE, KOCHI-682013 BY ADV. SRI.P.K.RAVINDRANATHA MENON (SR.) THIS INCOME TAX APPEAL HAVING COME UP FOR ADMISSION ON 13.10.2022, ALONG WITH ITA.247/2019 AND CONNECTED CASES, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE S.V.BHATTI PRESENT THE HONOURABLE MR.JUSTICE S.V.BHATTI & THE HONOURABLE MR.JUSTICE BASANT BALAJI THURSDAY, THE 13 DAY OF OCTOBER 2022 / 21ST ASWINA, 1944 ITA NO. 260 OF 2019 AGAINST THE ORDER IN ITA 452/COCH/2018 OF I.T.A.TRIBUNAL,COCHIN BENCH APPELLANT: HILLWOOD IMPORTS AND EXPORTS PVT. LIMITED CHUNGAM. FEROKE CALICUT. BY ADVS.P.RAGHUNATH SRI.PREMJIT NAGENDRAN RESPONDENT: COMMISSIONER OF INCOME TAX CENTRAL CIRCLE, KOCHI-682013 BY ADV. SRI.P.K.RAVINDRANATHA MENON (SR.) THIS INCOME TAX APPEAL HAVING COME UP FOR ADMISSION ON 13.10.2022, ALONG WITH ITA.247/2019 AND CONNECTED CASES, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE S.V.BHATTI & THE HONOURABLE MR.JUSTICE BASANT BALAJI THURSDAY, THE 13 DAY OF OCTOBER 2022 / 21ST ASWINA, 1944 ITA NO. 258 OF 2019 AGAINST THE ORDER IN ITA 453/COCH/2018 OF I.T.A.TRIBUNAL,COCHIN BENCH APPELLANT: HILLWOOD IMPORTS AND EXPORTS PRIVATE LIMITED CHUNGAM, FEROKE, CALICUT. BY ADVS.P.RAGHUNATH SRI.PREMJIT NAGENDRAN RESPONDENT: COMMISSIONER OF INCOME TAX, KOCHI-682013 BY ADVS.SRI.P.K.RAVINDRANATHA MENON (SR.) SRI.JOSE JOSEPH, SC, FOR INCOME TAX THIS INCOME TAX APPEAL HAVING COME UP FOR ADMISSION ON 13.10.2022, ALONG WITH ITA.247/2019 AND CONNECTED CASES, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE S.V.BHATTI & THE HONOURABLE MR.JUSTICE BASANT BALAJI THURSDAY, THE 13 DAY OF OCTOBER 2022 / 21ST ASWINA, 1944 ITA NO. 10 OF 2020 AGAINST THE ORDER IN ITA 447/COCH/2018 OF I.T.A.TRIBUNAL, COCHIN BENCH APPELLANT/APPELLANT/APPELLANT/ASSESSEE: HILLWOOD TIMBERS MAKKARPARAMBU, MALAPPURAM - 676 507. BY ADVS.P.RAGHUNATH SRI.PREMJIT NAGENDRAN RESPONDENT/RESPONDENT/RESPONDENT/REVENUE: COMMISSIONER OF INCOME TAX CENTRAL CIRCLE, KOCHI - 682 013. BY ADVS.SRI.P.K.RAVINDRANATHA MENON (SR.) SRI.JOSE JOSEPH, SC, FOR INCOME TAX THIS INCOME TAX APPEAL HAVING COME UP FOR ADMISSION ON 13.10.2022, ALONG WITH ITA.247/2019 AND CONNECTED CASES, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE S.V.BHATTI & THE HONOURABLE MR.JUSTICE BASANT BALAJI THURSDAY, THE 13 DAY OF OCTOBER 2022 / 21ST ASWINA, 1944 ITA NO. 3 OF 2020 AGAINST THE ORDER IN ITA 446/COCH/2018 OF I.T.A.TRIBUNAL,COCHIN BENCH APPELLANT: HILLWOOD TIMBERS MAKKARPARAMBU, MALAPPURAM-676507. BY ADVS.P.RAGHUNATH SRI.PREMJIT NAGENDRAN RESPONDENT: COMMISSIONER OF INCOME TAX CENTRAL CIRCLE, KOCHI- 682013. BY ADVS.SRI.P.K.RAVINDRANATHA MENON (SR.) SRI.JOSE JOSEPH, SC, FOR INCOME TAX THIS INCOME TAX APPEAL HAVING COME UP FOR ADMISSION ON 13.10.2022, ALONG WITH ITA.247/2019 AND CONNECTED CASES, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE S.V.BHATTI & THE HONOURABLE MR.JUSTICE BASANT BALAJI THURSDAY, THE 13 DAY OF OCTOBER 2022 / 21ST ASWINA, 1944 ITA NO. 13 OF 2020 AGAINST THE ORDER IN ITA 290/COCH/2018 OF I.T.A.TRIBUNAL,COCHIN BENCH APPELLANT/APPELLANT/APPELLANT/ASSESSEE: HILLWOOD FURNITURE PVT.LTD CHUNGAM, FEROKE, CALICUT-673 631 REP. BY M/D. V. SHAREEF. BY ADVS.P.RAGHUNATH SRI.PREMJIT NAGENDRAN RESPONDENT/RESPONDENT/RESPONDENT/REVENUE: COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE, KOCHI-682 013 BY ADV. SRI.P.K.RAVINDRANATHA MENON (SR.) THIS INCOME TAX APPEAL HAVING COME UP FOR ADMISSION ON 13.10.2022, ALONG WITH ITA.247/2019 AND CONNECTED CASES, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE S.V.BHATTI & THE HONOURABLE MR.JUSTICE BASANT BALAJI THURSDAY, THE 13 DAY OF OCTOBER 2022 / 21ST ASWINA, 1944 ITA NO. 4 OF 2020 ITA NO. 13 OF 2020 AGAINST THE ORDER IN ITA 290/COCH/2018 OF I.T.A.TRIBUNAL,COCHIN BENCH APPELLANT/APPELLANT/APPELLANT/ASSESSEE: HILLWOOD FURNITURE PVT.LTD CHUNGAM, FEROKE, CALICUT-673 631 REP. BY M/D. V. SHAREEF. BY ADVS.P.RAGHUNATH SRI.PREMJIT NAGENDRAN RESPONDENT/RESPONDENT/RESPONDENT/REVENUE: COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE, KOCHI-682 013 BY ADV. SRI.P.K.RAVINDRANATHA MENON (SR.) THIS INCOME TAX APPEAL HAVING COME UP FOR ADMISSION ON 13.10.2022, ALONG WITH ITA.247/2019 AND CONNECTED CASES, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE S.V.BHATTI & THE HONOURABLE MR.JUSTICE BASANT BALAJI THURSDAY, THE 13 DAY OF OCTOBER 2022 / 21ST ASWINA, 1944 ITA NO. 4 OF 2020 AGAINST THE ORDER IN ITA 285/COCH/2018 OF I.T.A.TRIBUNAL,COCHIN BENCH APPELLANT/APPELLANT/APPELLANT/ASSESSEE: HILLWOOD FURNITURE (P) LTD. CHUNGAM, FEROKE, CALICUT - 673 631 BY ADVS.P.RAGHUNATH SRI.PREMJIT NAGENDRAN RESPONDENT/RESPONDENT/RESPONDENT/REVENUE: THE COMMISSIONER OF INCOME TAX, KOCHI CENTRAL CIRCLE, KOCHI - 682 013 BY ADVS.SRI.P.K.RAVINDRANATHA MENON (SR.) SRI.JOSE JOSEPH, SC, FOR INCOME TAX THIS INCOME TAX APPEAL HAVING COME UP FOR ADMISSION ON 13.10.2022, ALONG WITH ITA.247/2019 AND CONNECTED CASES, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ITA Nos.247/2019, 255/2019, 259/2019, 256/2019, 260/2019, 258/2019, 10/2020, 3/2020, 13/2020, 4/2020, 8/2020, 11/2020, 12/2020, 16/2020 -11- IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE S.V.BHATTI & THE HONOURABLE MR.JUSTICE BASANT BALAJI THURSDAY, THE 13 DAY OF OCTOBER 2022 / 21ST ASWINA, 1944 ITA NO. 8 OF 2020 AGAINST THE ORDER IN ITA 288/COCH/2018 OF I.T.A.TRIBUNAL, COCHIN BENCH APPELLANT/APPELLANT/APPELLANT/ASSESSEE: HILLWOOD FURNITURE PVT. LTD. CHUNGAM FEROKE CALICUT 673 631. M/D. V.S JAREEF. BY ADVS.P.RAGHUNATH SRI.PREMJIT NAGENDRAN RESPONDENT/RESPONDENT/RESPONDENT/REVENUE: COMMISSIONER OF INCOME TAX CENTRAL CIRCLE, KOCHI 682 013. BY ADVS.SRI.P.K.RAVINDRANATHA MENON (SR.) SRI.JOSE JOSEPH, SC, FOR INCOME TAX THIS INCOME TAX APPEAL HAVING COME UP FOR ADMISSION ON 13.10.2022, ALONG WITH ITA.247/2019 AND CONNECTED CASES, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ITA Nos.247/2019, 255/2019, 259/2019, 256/2019, 260/2019, 258/2019, 10/2020, 3/2020, 13/2020, 4/2020, 8/2020, 11/2020, 12/2020, 16/2020 IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE S.V.BHATTI & THE HONOURABLE MR.JUSTICE BASANT BALAJI THURSDAY, THE 13 DAY OF OCTOBER 2022 / 21ST ASWINA, 1944 ITA NO. 11 OF 2020 AGAINST THE ORDER IN ITA 289/COCH/2018 OF I.T.A.TRIBUNAL,COCHIN BENCH APPELLANT/APPELLANT/APPELLANT/ASSESSEE: HILLWOOD FURNITURE PVT. LTD CHUNGAM, FEROKE, CALICUT - 673 631 BY ADVS.P.RAGHUNATH SRI.PREMJIT NAGENDRAN RESPONDENT/RESPONDENT/RESPONDENT/REVENUE: COMMISSIONER OF INCOME TAX CENTRAL CIRCLE, KOCHI - 682 013 BY ADVS.SRI.P.K.RAVINDRANATHA MENON (SR.) SRI.JOSE JOSEPH, SC, FOR INCOME TAX THIS INCOME TAX APPEAL HAVING COME UP FOR ADMISSION ON 13.10.2022, ALONG WITH ITA.247/2019 AND CONNECTED CASES, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ITA Nos.247/2019, 255/2019, 259/2019, 256/2019, 260/2019, 258/2019, 10/2020, 3/2020, 13/2020, 4/2020, 8/2020, 11/2020, 12/2020, 16/2020 IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE S.V.BHATTI & THE HONOURABLE MR.JUSTICE BASANT BALAJI THURSDAY, THE 13 DAY OF OCTOBER 2022 / 21ST ASWINA, 1944 ITA NO. 12 OF 2020 AGAINST THE ORDER IN ITA 287/COCH/2018 OF I.T.A.TRIBUNAL,COCHIN BENCH APPELLANT/APPELLANT/APPELLANT/ASSESSEE: HILLWOOD FURNITURE PVT LTD CHUNGAM, FEROKE, CALICUT-673 631 BY ADVS.P.RAGHUNATH SRI.PREMJIT NAGENDRAN RESPONDENT/RESPONDENT/RESPONDENT/REVENUE: COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE, KOCHI-682 013 BY ADVS.SRI.P.K.RAVINDRANATHA MENON (SR.) SRI.JOSE JOSEPH, SC, FOR INCOME TAX ITA Nos.247/2019, 255/2019, 259/2019, 256/2019, 260/2019, 258/2019, 10/2020, 3/2020, 13/2020, 4/2020, 8/2020, 11/2020, 12/2020, 16/2020 IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE S.V.BHATTI & THE HONOURABLE MR.JUSTICE BASANT BALAJI THURSDAY, THE 13 DAY OF OCTOBER 2022 / 21ST ASWINA, 1944 ITA NO. 12 OF 2020 AGAINST THE ORDER IN ITA 287/COCH/2018 OF I.T.A.TRIBUNAL,COCHIN BENCH APPELLANT/APPELLANT/APPELLANT/ASSESSEE: HILLWOOD FURNITURE PVT LTD CHUNGAM, FEROKE, CALICUT-673 631 BY ADVS.P.RAGHUNATH SRI.PREMJIT NAGENDRAN RESPONDENT/RESPONDENT/RESPONDENT/REVENUE: COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE, KOCHI-682 013 BY ADVS.SRI.P.K.RAVINDRANATHA MENON (SR.) SRI.JOSE JOSEPH, SC, FOR INCOME TAX THIS INCOME TAX APPEAL HAVING COME UP FOR ADMISSION ON 13.10.2022, ALONG WITH ITA.247/2019 AND CONNECTED CASES, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ITA Nos.247/2019, 255/2019, 259/2019, 256/2019, 260/2019, 258/2019, 10/2020, 3/2020, 13/2020, 4/2020, 8/2020, 11/2020, 12/2020, 16/2020 -14- IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE S.V.BHATTI & THE HONOURABLE MR.JUSTICE BASANT BALAJI THURSDAY, THE 13 DAY OF OCTOBER 2022 / 21ST ASWINA, 1944 ITA NO. 16 OF 2020 AGAINST THE ORDER IN ITA 286/COCH/2018 OF I.T.A.TRIBUNAL,COCHIN BENCH APPELLANT/APPELLANT/APPELLANT/ASSESSEE: HILLWOOD FURNITURE P LTD. CHUNGAM, FEROKE, CALICUT-673 631, REPRESENTED BY MANAGING DIRECTOR, V.SHAREEF. BY ADVS.P.RAGHUNATH SRI.PREMJIT NAGENDRAN RESPONDENT/RESPONDENT/RESPONDENT/REVENUE: COMMISSIONER OF INCOME TAX CENTRAL CIRCLE, KOCHI-682 013. BY ADV. SRI.P.K.RAVINDRANATHA MENON (SR.) THIS INCOME TAX APPEAL HAVING COME UP FOR ADMISSION ON 13.10.2022, ALONG WITH ITA.247/2019 AND CONNECTED CASES, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: JUDGMENT [ITA Nos.247/2019, 255/2019, 259/2019, 256/2019, 260/2019, 258/2019, 10/2020, 3/2020, 13/2020, 4/2020, 8/2020, 11/2020, 12/2020, 16/2020] S.V. Bhatti, J. We have heard Sri P Raghunathan, learned Counsel for the appellants, and Sri P K Ravindranatha Menon, learned Senior Counsel for the respondent. 2. M/s.Hillwood Imports and Exports Pvt. Ltd.; Hillwood Furniture Pvt. Ltd; Hillwood Timbers/Assessees, and the Commissioner of Income Tax/Revenue are the parties in the batch of appeals being disposed of by this common judgment. For convenience, the parties are referred to as the assessee and the Revenue. 2.1 The appellants/assessees are umbrella business entities doing business under the management of one V Shareef. On 04.12.2013, the Revenue carried out a search in the business premises of the assessees and the residence of Managing Director Sri V Shareef. On 14.07.2014, the Revenue conducted a survey at the premises of one Riyaz, who was an employee working with the assessee. The Deputy Commissioner, Central Circle-II, Kozhikode, by notice dated 29.02.2016, has taken up block assessment against the assesses. On 18.03.2016 the assesses filed reply to the pre-assessment notice dated 29.02.2016. On 29.03.2016 the Deputy Commissioner of Income Tax, Central Circle – II, completed the assessment for the block period stated in each one of the assessment orders. The assessee carried the matter in appeal, at the first instance, before the Commissioner of Income Tax (Appeals), and the appellate authority modified the assessment orders on the estimation of turnover etc and granted substantial relief to the assesses. The assesses filed second appeals before the Tribunal challenging the assessment order of the Deputy Commissioner dated 29.03.2016, and the order of the Commissioner dated 19.07.2018, particularly on the alleged manner and mode of the survey dated 14.07.2014 under Section 133A of the Act as illegal. The evidentiary value of documents alleged to have been impounded from the house of Riyaz is in breach of Sections 65A and 65B of the Evidence Act, and applying the data alleged to have been retrieved from the three pen drives from Riyaz is impermissible. The Tribunal rejected the request of the assessee to place on record the opinion of an expert on Hash Value Report generation and rejected the two principal grounds raised, namely, under Section 133A of the Act and Sections 65A and 65B of the Evidence Act. The Tribunal, by its common order dated 05.03.2019, dismissed the appeals filed by the assessees. Hence, the appeals under Section 260A of the Act. 3. The learned Counsel appearing for parties state that the circumstances leading to the block assessment, and the grounds of challenge are substantially identical in all the appeals. Hence, reference to the circumstances in one appeal would be sufficient for disposing of all the appeals. The appeals, though, are admitted on a few substantial questions of law, Adv. P Ragunathan formulated the following three substantial questions of law for decision in all the appeals. Question no.1: Whether the appellate Tribunal should not have found that the survey conducted on 14.7.2014 at the residential house of Sri Riyaz violated the provisions of Section 133A of the Income Tax Act? Question No.2: Whether the Appellate Tribunal did not commit an error of law when it dismissed the application for permission to raise additional ground - based on the provisions of Sections 65A and 65B read with Section 93 and the Second Schedule of the IT Act. Question No.3: Whether the generation of Hash Value Report in the presence of the assessee would mean that the contents of the pen drives were accessed in the presence of the assessee? ITA No.247/2019 has been treated as the representative appeal for disposing of connected appeals. I.T.A. No.247/2019 4. Hillwood Imports and Exports Pvt. Ltd./assessee is the appellant. The orders which are challenged before the statutory authorities are stated as follows: The assessee and its sister concerns are dealers doing business in timber. On 04.12.2013 search of the business premises of the assessee and the residence of its Managing Director along with the business premises of the sister concerns, was carried out. A few documents were recovered, and the statement of Managing Director V Shareef was recorded. On 14.07.2014, the Revenue conducted a survey of the premises of one Riyaz, an employee of the assessee’s company. The relationship or standing of Riyaz vis-à-vis is disputed by the assessee, however having regard to the findings of fact recorded by all the authorities, this Court proceeds on the basis of findings recorded in this behalf. The Department impounded a few account statements, and three pen drives from the custody of the said Riyaz. On 29.02.2016 pre-assessment notice for the Assessment Year 2008-09 to 2013-14 was served on the assessee. On 18.03.2016, the assessee filed the reply, and on 29.03.2016, the assessment was completed by determining the total income for assessment at Rs.7,31,36,150/. The assessee filed appeal, and by order dated 19.07.2018, the ITA Nos.247/2019, 255/2019, 259/2019, 256/2019, 260/2019, 258/2019, 10/2020, appeal was allowed in-part, and the estimation of turnover was modified. By effect order dated 25.10.2018, the income assessed to tax is determined as Rs.1,98,95,740/-. The Tribunal in Tax Appeal No.448/Coch/2018 dismissed the appeal filed by the assessee. 4.1 We find it convenient to examine the substantial questions of law in the same way the arguments are advanced by the learned Counsel appearing for the parties. 5. Substantial question Nos.2 and 3: ITA Nos.247/2019, 255/2019, 259/2019, 256/2019, 260/2019, 258/2019, 10/2020, appeal was allowed in-part, and the estimation of turnover was modified. By effect order dated 25.10.2018, the income assessed to tax is determined as Rs.1,98,95,740/-. The Tribunal in Tax Appeal No.448/Coch/2018 dismissed the appeal filed by the assessee. 4.1 We find it convenient to examine the substantial questions of law in the same way the arguments are advanced by the learned Counsel appearing for the parties. 5. Substantial question Nos.2 and 3: (2) Whether the Appellate Tribunal did not commit an error of law when it dismissed the application for permission to raise additional ground based on the provisions of Section 65A and 65B read with Section 93 and Second Schedule of the IT Act? (3) Whether the generation of Hash Value Report in the presence of the assessee would mean that the contents of the pen drives were accessed in the presence of the assessee? 5.1 Adv P Ragunathan argues that the Tribunal committed a jurisdictional error, both in law and fact, by dismissing the application filed to raise additional grounds under Sections 65A and 65B of the Evidence Act read with the Second Schedule of the IT Act. Sections 65A and 65B are the provisions dealing with the admissibility of electronic records as evidence. Section 65B deals with the accessibility of electronic records. The assessment orders are based on the data retrieved from the three pen drives recovered from Riyaz, who, according to the assessee, is a former employee of the business concerns. The Department got the pen drives examined by an expert and data was recovered. The Department has relied upon the contents of the record electronically generated. Therefore, strict compliance with the conditions laid down in Section 65B is necessary. The Supreme Court in Anvar P V v. P K Basheer[1] held that if the electronic record is being used as evidence, the conditions mentioned under Section 65B (4) are strictly complied with. The Hash Value Report and accepting the said Hash Value Report as correct by the Tribunal and the Commissioner is illegal and untenable. 5.2 He further contends that there is nothing on record to suggest that the very pen drives, assuming without admitting, having a few details of the assessee, are the pen drives recovered from Riyaz. The Hash Value Report was generated on 22/23.07.2014. Therefore, the estimation now arrived at on the suppressed turnover etc is not based on any evidence. Therefore, in this background, the assessee was advised to place on record an expert opinion on the Hash Value Report dated 23.07.2014 and permit the assessee to raise additional grounds. The Tribunal ought to have allowed the assessee to raise additional grounds and bring on record expert opinion. The rejection of both requests has prejudiced the case of the assessee, and the notional value, without there being a semblance of evidence, has been assessed by the Revenue. He invites our attention to Anvar P V v. P K Basheer (supra) and M/s. P A Kuriakose Jewellers v. The Assistant Commissioner of Income Tax[2]in support of the above arguments. 5.3 According to the assessee, the Department, for the first time, during the pendency of the appeals before the Tribunal, has come up with a case that the Hash Value Report was generated on 22/23.07.2014 when the pen drives were opened by expert. The assessee, to find out whether the data now relied on by the Department is secured in accordance with the procedure prescribed in this behalf, has obtained the report of Sri Vinod Bhattathiripad, who opined that generation of Hash Value at the time of opening the pen drive is meaningless unless the Hash Value at the time of the seizure of the pen drive had been recorded. The shutting out of an expert’s opinion is illegal. 2 Order dated 24.05.2018 in ITA 459/Coch/2010 and connected cases Therefore, according to learned Counsel Mr Ragunathan, the 5.3 According to the assessee, the Department, for the first time, during the pendency of the appeals before the Tribunal, has come up with a case that the Hash Value Report was generated on 22/23.07.2014 when the pen drives were opened by expert. The assessee, to find out whether the data now relied on by the Department is secured in accordance with the procedure prescribed in this behalf, has obtained the report of Sri Vinod Bhattathiripad, who opined that generation of Hash Value at the time of opening the pen drive is meaningless unless the Hash Value at the time of the seizure of the pen drive had been recorded. The shutting out of an expert’s opinion is illegal. 2 Order dated 24.05.2018 in ITA 459/Coch/2010 and connected cases Therefore, according to learned Counsel Mr Ragunathan, the Tribunal failed to exercise its jurisdiction to determine the correctness of orders under appeal before it. Firstly, prays for setting aside the orders under appeal as based on no evidence. Secondly, he argues that the findings recorded by the Tribunal on these two issues be set aside and the matter remitted to Tribunal for a decision afresh. 6. Sri P K R Menon, learned Senior Counsel appearing for the respondent, argues that the substantial question nos. 2 and 3 ought not to be appreciated by this Court in isolation of the circumstances preceding the pre-assessment notice. He invites our attention to the pre-assessment notice and contends that the block assessment refers to books of account seized in the search conducted on 04.12.2013 and the statement recorded under Section 132(4) of the Act of the Managing Director and other employees of the assessee’s business undertakings. The pre- assessment notice specifically calls upon the assessee to give a reply on the details of business transactions recovered from the premises of Riyaz. The details/materials collected, both in the search and the survey, were counter-checked with the parties noted in the evidence gathered by the Department. The confirmation statements of the parties referred to in the material recovered during and in the course of the search and survey constitute the basis for the pre-assessment notice. 6.1 Therefore, it is incorrect to argue that the three pen drives recovered from Riyaz and the electronically generated copies from these pen drives alone constituted the basis for arriving at either the suppression of income or suppression of turnover by the assessee. The notice, since contains all the details of the assessee, as a belated effort, by referring to the ITA Nos.247/2019, 255/2019, 259/2019, 256/2019, 260/2019, 258/2019, 10/2020, 3/2020, 13/2020, 4/2020, 8/2020, 11/2020, 12/2020, 16/2020 statement made by the Department during the pendency of the appeal before the Tribunal, introduced additional grounds/evidence. He states that the Revenue does not contend that the Tribunal lacks jurisdiction to entertain an additional ground or allow additional material to come on record. But the jurisdiction is exercised after appreciating the circumstances of the case and the available discretion is judiciously exercised. He invites our attention to the chronology of dates and events and argues that the additional grounds and additional materials are nothing but ex post facto attempts by the assessee to challenge the revised order of assessment passed by the Assessing Officer. 7. The substantial questions considered by this Court will have to be examined in the light of what is clearly borne out by the record on the controversy surrounding the pen drives and the generation of data from the pen drives. Therefore, it is very 7. The substantial questions considered by this Court will have to be examined in the light of what is clearly borne out by the record on the controversy surrounding the pen drives and the generation of data from the pen drives. Therefore, it is very much required to appreciate the case of respective parties as follows: Pre-assessment notice dated 29.02.2016 refers to the recovery of actual details of the business transactions with various third parties recovered from the premises under the control one Riyaz, as noted above, an employee of the assessee, and the controversy is whether the employee was in service or resigned when the survey was carried out on 14.07.2014. The pre-assessment notice refers to documents recovered and impounded on both the occasions. The entry-to-entry matching of the details from all the sources was undertaken in the presence of Sri A P Vinodkumar and one Hakim during the course of the assessment proceedings. The statements of Hakkim, Beeran, Krishnaprasad, Riyaz were handed over to A.P Vinodkumar the authorized representative of the assessee. 7.1 The authenticity of data or business transactions in the pen drives, whether they pertain to the business transactions of the assessee firm, and the loose sheets recovered from the house of Riyaz are taken note of and handed to the assessee. The manner in which the turnover has been suppressed and income from the business is suppressed was put to the assessee. The assessee filed reply dated 18.03.2016. For our present purpose, it is sufficient to note that, among other objections, the principal objection of the assessee, either on the material or pen drives retrieved from Riyaz, is that the survey was conducted at the residence of Riyaz and conducting the survey at the residence under Section 133A of the Act is unauthorized. On the pen drives, the objection raised by the assessee is that the material and pen drive must be eschewed and alternatively, there is no evidence on record to show that the alleged data, projected in the notice and furnished to the assessee, are available in the pen drives alleged to have been impounded. The assessment order has referred to the documents recovered or impounded on both occasions and considered in the background of the statements recorded from the persons who seized the material. The assessment order refers to item-wise examination. 8. The assessment order in paragraphs 12 and 12.2 considered the data in the pen drives. Paragraphs 13 and 14 refer to the business transactions and preparation of accounts supported by the sworn statement of Hakkim, Beeran, and Krishnaprasad. A bare reading of the assessment order concludes the controversy on the consideration by the primary authority, hence, we find it useful to excerpt para 14: “14 As regards the authenticity of the data contained in the pendrive seized from the possession of Shri Riyaz,, one of the assessee's employee, the following facts are pertinent. 14.2 Shri Riyaz M is an employee whose employee status was ITA Nos.247/2019, 255/2019, 259/2019, 256/2019, 260/2019, 258/2019, 10/2020, 8. The assessment order in paragraphs 12 and 12.2 considered the data in the pen drives. Paragraphs 13 and 14 refer to the business transactions and preparation of accounts supported by the sworn statement of Hakkim, Beeran, and Krishnaprasad. A bare reading of the assessment order concludes the controversy on the consideration by the primary authority, hence, we find it useful to excerpt para 14: “14 As regards the authenticity of the data contained in the pendrive seized from the possession of Shri Riyaz,, one of the assessee's employee, the following facts are pertinent. 14.2 Shri Riyaz M is an employee whose employee status was ITA Nos.247/2019, 255/2019, 259/2019, 256/2019, 260/2019, 258/2019, 10/2020, acknowledged by the following staff the assessee namely Shri Hakkim K, Shri Beeran E K, Shri Krishnaprasad KT. These key staff of the assessee has also acknowledged that the documents and the pendrive impounded from the premises under the control of Shri M Riyaz pertain to the business transactions entered into by the assessee with various parties. During the survey operations at the premises of Shri Riyas M certain documents (HW/R/13, HW/R/04, HW/R/07, HW/R/18, HW/R/17, HW/R/19) pertaining to the business transactions entered into by the assessee were recovered. These documents were prepared by Shri E K Beeran and Shri K T Krishnaprasad who had acknowledged the same in the statements recorded from them. It was seen that the day books entries in the software recovered from the pendrive is exactly matching with the impounded materials as mentioned above. It was also seen that in a survey u/s 133A conducted in the corporate office on 24-07-2014 certain loose sheets were impounded (HSSA -1) which were exactly similar to the loose sheets impounded and marked as HW/R/13, HW/R/04, HW/R/07, HW/R/18, HW/R/17, HW/R/19. All of the above clearly point towards authenticity of the data contained in the pendrive seized from the possession of Shri Riyaz,, one of the assessee's employee. 14.3 Certain documents were recovered and impounded on 14/07/2014, during the course of survey u/s133A,from the premises under the control of Shri M Riyaz, who is an employee of the assessee company. These documents were pertaining to the business transactions entered into by the assessee with various parties. In this regard, of particular relevance is the following material HW/R/05 (impounded on 14/07/2014 from secret location where Shri Riyaz was present). The loose sheets 15 to 17 therein relate to the transaction with a party by name Murali, Irinjalakkuda. In this regard CHN/13 14/S&S/18/HW(1)-1 recovered from the assessee's premise on the day of search action u/s 132 on 04-12-2013 is related. The business transactions recorded in both the seized materials relate to the same party Murali, Irinjalakuda. The ledger account of the above party in the books of account in support of the assessee's ROI has also recorded all the transactions as appearing in the seized and impounded materials. 14.4 The MD of the company has acknowledged (Refer Q&A 5 of statement u/s 131(1) recorded on 04-08-2014) that the documents and the pendrive impounded from the TAX premises under the control of Shri M Riyaz pertain to the business transactions entered into by the assessee with various parties.” ITA Nos.247/2019, 255/2019, 259/2019, 256/2019, 260/2019, 258/2019, 10/2020, 8.1 The Commissioner of Income Tax (Appeals) adverting to the objections on placing reliance on the data available in the pen drive, read as follows: “5.4. I have gone through the assessment order and submission 14.4 The MD of the company has acknowledged (Refer Q&A 5 of statement u/s 131(1) recorded on 04-08-2014) that the documents and the pendrive impounded from the TAX premises under the control of Shri M Riyaz pertain to the business transactions entered into by the assessee with various parties.” ITA Nos.247/2019, 255/2019, 259/2019, 256/2019, 260/2019, 258/2019, 10/2020, 8.1 The Commissioner of Income Tax (Appeals) adverting to the objections on placing reliance on the data available in the pen drive, read as follows: “5.4. I have gone through the assessment order and submission of the appellant. On 04.12.2013 a search and seizure operation was carried out at the premises of the appellant company, other group concerns and directors of the companies. During the course of search, voluminous documents were found and seized evidencing that the appellant company as well as other group concerns were engaged in systematic suppression of sales and thereby profits. Details of these documents seized and contents of these documents have been elaborated by the AO in the assessment order. During the post search investigation, the Investigation Wing received information that the books of accounts are also maintained at a different premise, which was under the control of Shri Riyaz, who is an employee of Mr. Shareef, the controller of Hillwood Group. A survey u/s. 133A was carried out on 14.07.2014 at the said premises of Shri Riyaz M. and books of accounts belonging to Hillwood Group was found and impounded. During the course of survey 3 pen drives containing data of Hillwood Group was also found and these were also impounded. The contents of the pen drives were subjected to forensic imaging and a copy of the contents were provided to Shri Shareef and his Authorized Representative also. The vendor of the software used was Identified as Shri Jacob A. J. and his statement was also taken, Mr. Jacob stated that the software was a complete accounting package and was sold to Hillwood Group. There is no dispute about the fact that data contained therein in the pen drives found and impounded belonged to the Hillwood Group and the same were also compared to the documents found and seized during the course of search. Since the data found in the pen drives have been supplied to the appellant i.e. Mr. Shareef, it cannot be said that the principle of natural justice have not been adhered to. The AO has compared the data from the pen drive to the seized documents and also the books of account maintained by the appellant in regular course of business. Nothing adverse can be Inferred from the fact that the pen drive was impounded in a survey seven to 8 months after the search was initiated in the Group. Once an information has been received, the officers of the Department are duty bound to conduct inquiries through and according to various provisions available in the Act. Thus, on the basis of fact of this case, it is seen that: a) Ground of Appeal No.2 is factually incorrect as the assessment has been completed by the AO on the basis of data and evidences found during the course of search and the data found to be contained in the said Pen Drive. Ground of Appeal No. 2 is dismissed accordingly. b) On the basis of discussion above, it is clear that neither the search nor the survey conducted subsequently are bad-in-law, as there has been no legal or procedural infirmity in carrying out the same. There is no dispute that the data contained in the said Pen Drive belonged to the Appellant Ground of Appeal No. 3 of the appellant is dismissed accordingly. c) Ground of Appeal No.4 also cannot be allowed as it is proved beyond doubt that the data contained in the Pen Drive belonged to the Appellant and its group concerns and the AO has correctly used such data in computing the income of the appellant. This ground of appeal of the appellant is dismissed. found during the course of search and the data found to be contained in the said Pen Drive. Ground of Appeal No. 2 is dismissed accordingly. b) On the basis of discussion above, it is clear that neither the search nor the survey conducted subsequently are bad-in-law, as there has been no legal or procedural infirmity in carrying out the same. There is no dispute that the data contained in the said Pen Drive belonged to the Appellant Ground of Appeal No. 3 of the appellant is dismissed accordingly. c) Ground of Appeal No.4 also cannot be allowed as it is proved beyond doubt that the data contained in the Pen Drive belonged to the Appellant and its group concerns and the AO has correctly used such data in computing the income of the appellant. This ground of appeal of the appellant is dismissed. d) Grounds of Appeal Nos. 5, 6 and 7 relate to Principle of Natural justice and use of data contained in the Pen Drives. It has already been discussed earlier that there is no dispute about the fact that the data contained in the said pen drives belonged to the appellant group and copy of the data was provided to the appellant before finalization of the assessment. The appellant has objected that Mr. Riyaz was not made available for cross-examination by the Department. In this regard, it is an important fact that the statement of Riyaz has not been used to compute the income of the appellant, but it is the date contained in the pen drive has been used for assessment. Since the statement of Mr. Riyaz has not been used against the appellant, there is no question of giving an opportunity of cross-examination of Mr. Riyaz to the appellant arises. The data in the Pen Drive has been used against the appellant and, therefore, a copy of the same was given to the assessee. Mr. Riyaz is an employee of Mr. Shareef and it is an undisputed admitted fact that data contained in the Pen Drive found during the course of survey at the premises of Mr. Riyaz belonged to the assessee. I do not seen any violation of Principle of Natural Justice in the facts of this case: Since the above data belonged to the appellant, the AO has correctly used them for the purpose of assessment. Grounds of Appeal Nos. 5, 6 and 7 are thus dismissed.” 9. The assessee, therefore, cannot be allowed to state that the Department, for the first time, has come up with an expert examination of data in the pen drives, the generation of Hash Value, and reliance on materials unconnected to the assessee. It is in this background; the Tribunal recorded the ITA Nos.247/2019, 255/2019, 259/2019, 256/2019, 260/2019, 258/2019, 10/2020, following findings; “8. We have heard the rival submissions and perused the record. Now the question for us to consider is whether the additional grounds of appeals can be raised before the Tribunal which does not arise out of the order of the CIT(A). The law is very well settled, the power of Tribunal is not confined to deal only with issues arising out of the order of the CIT(A) or, for that purpose out of the order passed by the Assessing Officer. In the case of National Thermal Power Corporation Ltd. vs. CIT 229 ITR 383), the Supreme Court observed that the power of the Tribunal is not confined to dealing with the issue which is arising out of the order of the authorities below. As long as the issue is relating to framing of correct assessment for the relevant assessment year, and particularly, when the relevant facts can be ascertained from the material already on record, it is open to the assessee and the Department to raise that issue provided the issue was raised as bona fide and the same should have been raised for good reasons. In our opinion, the Tribunal has the power to admit the additional ground of appeal which may not arise out the order of the lower authorities. There is no dispute or controversy about the power of the Tribunal to admit the additional ground of appeal. However, whether, in a particular situation the Tribunal should exercise such powers or not, would essentially depend upon the facts of such a case and as there cannot be any, and there is o straitjacket formula of universal application to decide the question of admission of additional ground or criteria for admission thereof, which operates de hors the peculiarities of a fact situation. As long as the issue is related to the correct determination of tax liability of the assessee in a particular assessment year and availability of relevant facts found from the material already on record, it is open to the assessee and department to raise that issue provided that the issue so raised is bona fide and the same could not have been raised on an earlier occasion for good and sufficient reasons. The limitations are that there are no new facts which required to be investigated by the said admission of additional ground and there should be good and sufficient reasons for not raising the issue on an earlier occasion by the assessee/department. The assessee has to demonstrate the existence of good and sufficient reasons for not raising the additional ground in the earlier proceedings of the lower authorities. The additional grounds have to be taken up before the Tribunal on account of bona fide reasons which are stated to be true and correct reasons by the assessee. On this fact, in our humble opinion, the assessees' cases fail. We find from the reasons given by the assessees that the assessees have given reasons for raising the additional ground ITA Nos.247/2019, 255/2019, 259/2019, 256/2019, 260/2019, 258/2019, 10/2020, before us as follows: "I am filing herewith additional grounds in respect of these assessment years which may be considered and adjudicated in the appeal proceedings. The omission to file this grounds may be condoned and the grounds may be considered in the appeal proceedings." 8.1 In our opinion, there should be good and sufficient reasons for raising the additional ground by the assesses before the Tribunal. The discretion given to the Tribunal to consider the additional ground is not an arbitrary one circumscribed by the Limitation Act. The discretion vested with the Tribunal to do so is to be exercised in the interest of justice in the facts and circumstances of each case. Normally, a question of fact is not to be allowed to be raised for the first time as it may prejudice to other side. If such a question is raised at the earliest opportunity, the other side can lead evidence, which it may not be able to do if such a question is raised for the first time before the Tribunal. In view of this, the plea to admit the additional ground could not be allowed to be raised for the first time before this Tribunal. 8.2 In the present case, the assessees have failed to explain the reason for not raising the additional ground on earlier occasion and also the reason given by the assessees is that only omission to raise the additional ground and they have not given 8.2 In the present case, the assessees have failed to explain the reason for not raising the additional ground on earlier occasion and also the reason given by the assessees is that only omission to raise the additional ground and they have not given any reason for such omission. Therefore, it is evident that the assessees adopted callous approach which demonstrated utter indifference in the matter. In such a situation, sufficient cause does not exist to raise the additional ground on earlier occasion which remains unexplained. In our opinion, there is complete negligence on the part of the assessees and complete absence of due diligence to pursue the matter in question. It cannot be said that the case of the assessees falls under the category which is beyond the control of the assessee. As discussed earlier, the assessee has failed to show "sufficient cause" for not raising the additional ground within t