COMMISSIONER OF INCOME TAX Vs. K RAVINDRANATHAN NAIR

JUDGEMENT

(1.) THE GIT, Thiruvananthapuram, has filed this appeal against the order of the Tribunal, Cochin Bench, in ITA No. 457/Coch/95, dt. 20th March, 1999. While admitting the appeal notice was ordered on the following questions of law :

(2.) HEARD the counsel on both sides.

(3.) SRI George K. George, learned Central Government standing counsel (Taxes) on behalf of the appellant submitted that the Tribunal was not justified in directing the AO to examine the two persons mentioned above to ascertain their creditworthiness to advance the amounts to the assessee in view of the provisions contained in Rule 46A. The standing counsel submits that Rule 46A clearly prohibit the production of any documents before the first appellate authority other than the evidence produced by the assessee during the course of the assessment proceedings except in the three circumstances specified in the said rule. The counsel also submits that the assessee's case does not fall under any of the said three circumstances. The standing counsel pointed out that the first appellate authority in its order had clearly stated that the assessee had not shown any cause for not producing this evidence before the assessing authority. Standing counsel also submitted that the Tribunal without considering the effect of the provisions of Rule 46A had issued the direction to the AO. The standing counsel also took us to the decision of this Court in C. Unnikrishnan v. CIT : [1998]233ITR485(Ker) and the decision of the Allahabad High Court in Ram Prasad Sharma v. CIT : [1979]119ITR867(All) and submitted that the order of the Tribunal on this issue cannot be sustained.