Itta/488/2010 Of Shri Padala Srinivasa Reddy v. The Deputy Commissioner Of Income Tax

THE HON’BLE SRI JUSTICE V.V.S.RAOANDTHE HON’BLE SRI RAMESH RANGANATHAN ITTA No.488 OF 2010 20.09.2010 Between: Sri Padala Srinivasa Reddy AND …Appellant The Deputy Commissioner of Income Tax,Circle-I, Rajahmundry. …Respondent THE HON’BLE SRI JUSTICE V.V.S.RAOANDTHE HON’BLE SRI RAMESH RANGANATHAN ITTA No.488 OF 2010 COMMON ORDER: (per Hon’ble Sri Justice V.V.S.Rao) This appeal is against the order of the Income Tax AppellateTribunal, Visakhapatnam Bench, Visakhapatnam inI.T.A.No.505/Vizag/2003, dated 16.09.2009. The petitioner is an individual assessee. For the assessment year1998-1999, he filed Return on 30.03.1999 admitting income ofRs.46,410/-. It is a case of search and seizure on 23.12.1997 inconnection with another assessee, namely, Padala SatyananarayanaReddy group. The case was taken up for scrutiny. Pursuant to a noticeunder Section 143(2) of the Income Tax Act, 1961, the assesseeappealed before the respondent. It was noticed that during search andseizure operations inter alia certain promissory notes in the name of theassessee were found and amounts realized thereon were included in hisincome. Therefore, the assessee was requested to furnish the totalamount of interest due as per the amounts included in the blockassessment without deducting the amounts claimed as realized. Interestamount of Rs.1,86,844/- thereon was worked out and was included in theincome and, accordingly, the tax was assessed at Rs.52,762/-. Theassessee appealed before the Commissioner of Income Tax (Appeals)(CIT (A)). By order dated 16.09.2009, CIT (A) partly allowed the appeal observing that the interest amount on the pro-notes dated 15.04.1995 and10.10.1996, which were in the names of other persons, amounting toRs.32,353/- are to be deleted from the addition made by assessingofficer. The assessee then appealed further to the Tribunalunsuccessfully. The Tribunal dismissed the appeal rejecting the plea thatthe pro-notes did not belong to the assessee. The appellant filed anapplication being M.A.No.59/Vizag/2009 to recall the order dated16.09.2009 passed by learned Tribunal on the ground that the additionalgrounds raised by the assessee were not considered, and the additionalevidence filed was not taken into consideration. The said application wasrejected on 23.09.2009. Counsel for appellant submits that the learned Tribunal erred innot considering the additional grounds filed under Rule 11 of the IncomeTax (Appellate Tribunal) Rules, 1963 (hereafter called, the Rules), whichwere filed along with an application under Rule 29 thereof for productionof additional evidence before the Tribunal. Counsel for appellant submits that the learned Tribunal erred innot considering the additional grounds filed under Rule 11 of the IncomeTax (Appellate Tribunal) Rules, 1963 (hereafter called, the Rules), whichwere filed along with an application under Rule 29 thereof for productionof additional evidence before the Tribunal. The submission made by the counsel for petitioner cannot becountenanced. The learned Tribunal dismissed the appeal on16.09.2009. During pendency of the said appeal, which relates to theassessment year 1998-1999, the appellant did not file any applicationunder Rule 29 of the Rules or any additional grounds under Rule 11 ofthe Rules. A perusal of a copy of the documents, annexed toMemorandum of Appeal, would show that Revenue took up blockassessment for the period 1987-1988 to 1997-1998. The same wassubject matter of another appeal being I.T (SS) No.44/Vizag/2002. Thesame was partly allowed on 10.01.2008 sustaining ground No.1 therein,which is to the effect that “in the facts and circumstances of the case, theorder of the assessing officer under Section 143(3) read with Sections158BC and 158BD is erroneous and is not in accordance with law in theabsence of satisfaction on the part of the assessing officer that theincome belonged to the assessee Srinivasa Reddy, and that the samebelonged to one P.Satyanrayana Reddy”. By that time, the appeal inrespect of assessment year 1998-1999 was also pending. The appellantthen filed two applications on 22.05.2008 purportedly under Rules 11and 29 of the Rules separately. In the first application, he raisedadditional grounds that the pro-notes, and other documents in the searchoperations on 23.12.1997, did not relate to appellant and they belongedto Satyanarayana Reddy. In the other petition he sought to file as manyas nineteen (19) documents all of which are post litem motam. By thattime, the assessing officer had not disposed of the matter. Nothingprevented the appellant to file those documents. The appeal waspending before CIT (A) during which no such ground was urged.Therefore, the plea of the appellant that relevant material was eschewed by the assessing authorities cannot be accepted. The additionalevidence includes the affidavit of the appellant and correspondence withthe chartered accountant, which prima facie came into existence after theappeal was disposed of by the CIT. Therefore, much significance cannotbe attached. Further more, when the appellant filed the application underSection 254(2) of the Act, the learned Tribunal itself held that all thegrounds raised by the appellant and the additional evidence filed byappellant were already considered though there was no specific order onthose applications. We have perused all the orders passed by thelearned Tribunal and we are convinced that the case does not involveany substantial question of law. The appeal is therefore dismissed in limine. __________________ (V.V.S.RAO, J) ____________________________ (RAMESH RANGANATHAN)