JUDGMENT : Suddala Chalapathi Rao, J. 1. The instant appeals have been filed challenging the orders passed by the Income Tax Appellate Tribunal, Hyderabad Bench-A (for short ‘the learned ITAT’) in ITA.No.1463/HYD/2017 and ITA.No.1464/HYD/2017, both dt.31.05.2022 relating to the assessment years 2012-13 and 2013-14, respectively. 2. As both appeals emanate from proceedings concerning the same assessee and raise common issues, though pertaining to two different assessment years, they are analogously heard and are being disposed of by this common judgment. THE BRIEF FACTS: 3. The appellant-company is a public limited company engaged in the research, production, and sale of hybrid seeds and open-pollinated seed varieties of various crops. The appellant filed its return for the assessment years 2012-13 admitting a total income of Rs.17.778 crores under the normal provisions and book profit of Rs.14.74 crores under Section 115JB, and for the assessment year 2013-14, it admitted a total income of Rs.43.64 crores under the normal provisions and book profit of Rs.40.92 crores under Section 115JB. 4. The Assessing Authority passed separate assessment orders on 30.03.2015 for both the assessment years. For the assessment year 2012-13 additions of Rs.50,94,74,053/- towards disallowance under Section 10(1) and Rs.1,00,08,831/- towards disallowance under Section 14A were made, resulting in determination of total income at Rs.69,73,27,348/-. For the assessment year 2012-13, additions of Rs.91,45,53,234/- towards disallowance under Section 10(1) and Rs.1,48,39,684/- towards disallowance under Section 14A were made, determining total income at Rs.136,58,86,808/-. 5. Challenging the said assessment orders, the assessee preferred appeals before the Commissioner of Income Tax(Appeals)(for short ‘the CIT(A)’). The CIT(A) after due enquiry and appreciation of facts and material on record, partly allowed the appeals by deleting the disallowance made under Section 10(1) of the Act, while confirming the disallowance made under Section 14A of the Act. 6. Aggrieved by the order of the CIT(A), the assessee as well as the Revenue preferred appeals before the learned ITAT in ITA.No.1463/HYD/2017 and ITA.No.1464/HYD/2017. By a common order, dt.31.05.2022, the learned ITAT remanded both the matters to the Assessing Officer (AO) with a direction to examine whether nature of business of the assessee is agriculture or not, and also to recompute the disallowance depending upon the determination of the nature of the business of the assessee. 7. Aggrieved by the said remand orders passed by the learned ITAT in ITA.No.1463/HYD/2017 and ITA.No.1464/HYD/2017, the assessee has filed the instant appeals. 8. 7. Aggrieved by the said remand orders passed by the learned ITAT in ITA.No.1463/HYD/2017 and ITA.No.1464/HYD/2017, the assessee has filed the instant appeals. 8. Before dwelling into the substantial questions arising for consideration in these appeals, it is pertinent to advert to the subsequent events that transpired during the pendency of the appeals before the learned ITAT. 9. During the pendency of the said appeals before the learned ITAT, a search was conducted by the department on 04.01.2018 at various business premises of the appellant, pursuant to which, certain incriminating material was alleged to have been unearthed. Consequent thereto, a notice under Section 153Aof the Act was issued on 24.12.2018. The validity of the search as well as the notice issued thereafter, has been challenged by the assessee before this Court in WP.No.9719 of 2019, and interim stay has been granted and the writ petition is pending adjudication. 10. Notwithstanding the pendency of the said writ petition, the Revenue has filed an application before the learned ITAT on 01.10.2019 for admission of the alleged incriminating material/documents found during search for consideration in the appeals. Though the assessee seriously objected the said application to receive the said material as additional evidence for determination of the main issue before the learned ITAT, the learned ITAT allowed the application and has appreciated the said documents and on the basis of the same, concluded that the disallowance under Section 10(1) of the Act was not proper and sustainable, and thus, remanded the matter to the Assessing Authority with a direction to reconsider the issue relating to disallowance under Section 14A of the Act. The said orders passed by the learned ITAT, were challenged before this Court in the instant appeals. 11. Both the appeals were admitted by this Court on the following substantial questions of law: 1) Whether on the facts and in the circumstances of the case, Tribunal was justified in invoking Rule 29 of the Income Tax Appellate Tribunal Rules, 1963, in accepting additional evidence adduced by the revenue when Rule 29 expressly prohibits the revenue from bringing on record such additional evidence? 2) Whether on the facts and in the circumstances of the case, Tribunal was justified in taking into account proceedings under Section 153A of the Act while dealing with the appeal of the revenue notwithstanding the fact that proceedings under Section 153A of the Act are separate and distinct and evidence obtained in such proceedings cannot be relied upon in an appeal before the Tribunal? 12. Heard Sri S. Ravi, learned Senior Counsel representing M/s CKR Associates, for the appellant/assessee and Sri K.Sudhakar Reddy, Senior Standing Counsel for Income Tax Department appearing for respondents, in both the appeals. Contentions of the Appellant-Assessee: 13. The principal contention of the learned Senior Counsel for the appellant/assessee is that the purport and scope of Rule 29 of the Rules make it clear that neither the Revenue nor the assessee has any vested right to file an application for adducing additional evidence during the pendency of the appeal before the learned ITAT, and it is only the learned ITAT, which, if it deems necessary, may direct either of the parties to adduce additional evidence or to file any affidavit or produce any documentary evidence before it. Therefore, the application filed by the Revenue for marking the alleged incriminating material as additional evidence and for considering the substance of such documents by the learned ITAT is nothing but exceeding the jurisdiction under Section 254 of the Act. It is further contended that even the direction issued by the learned ITAT remanding the matter to the Assessing Authority for fresh consideration constitutes acting beyond its scope of jurisdiction. 14. It is further contended that the learned ITAT failed to appreciate Rule 29 of the Rules in its proper perspective. In support of this contention, reliance is placed on the decision of the Hon’ble Supreme Court in Malayalam Plantations Ltd. v. State of Kerala and Ors. , AIR 2011 SC 559 , wherein it was held that adducing additional evidence is in the interest of justice and adducing evidence relating to subsequent happenings or events which are relevant for disposal of appeal, is not permissible for a party at the appellate stage of appeal by raising fresh allegations and call upon the opposite party to admit or deny the same. 15. 15. It is further contended that any such attempt is contrary to the mandate of Order XLI Rule 21 of CPC and that additional evidence cannot be permitted at the appellate stage merely to enable either party to fill up lacunae in its case. Reliance is place on the decisions of the Hon’ble Supreme Court in Arjun Singh alias Puran vs. Kartar Singh and Ors. , AIR 1951 SC 193 and Natha Singh and others v. The Financial Commissioner, Taxation, Punjab & Ors , AIR 1976 SC 1053 , wherein it was held that if the additional evidence is permitted to be adduced contrary to the principles governing its reception, would amount to an improper exercise of discretion. 16. Placing reliance on the above judgments, learned Senior Counsel, Sri S. Ravi, submitted that even at the appellate stage, applications for adducing additional evidence under Order XLI Rule 27 of CPC cannot be routinely entertained and in the instant case Rule 29 categorically emphasizes that during the pendency of an appeal before the learned ITAT, neither party is entitled to file an application to adduce additional evidence and that it is only when learned ITAT itself considers such documents or affidavit or additional evidence is necessary for a just adjudication, it may call upon the parties to produce the same. It is therefore, contended that the learned ITAT exceeded its jurisdiction in allowing the Revenue to adduce additional evidence. In support of this submission, reliance is also placed on the decisions of the Hon’ble Supreme Court in Mohinder Singh Gill vs. Chief Election Commissioner (1978) 1 SCC 405 and also the erstwhile High Court of Andhra Pradesh in B.Bala Narasimha Reddy v. Principal Commissioner of Income-Tax & Another Order dt.17.08.2015 in WP.No. 22254 of 2015 , wherein it was held that the additional evidence cannot be permitted at the instance of the parties in a routine manner and that it is for the learned ITAT to call for such material as may be necessary to arrive at a just conclusion. Contentions of the Respondent-Revenue: 17. Per contra, the learned Standing Counsel appearing for the respondent/Revenue submits that there is no flaw or infirmity in the order of the learned ITAT. Contentions of the Respondent-Revenue: 17. Per contra, the learned Standing Counsel appearing for the respondent/Revenue submits that there is no flaw or infirmity in the order of the learned ITAT. It is contended that the documents in question were unearthed during a search conducted by the Department and as they are relevant and necessary for adjudication of the appeals, were rightly brought on record, and the learned ITAT was justified in receiving the said material as additional evidence, and therefore, no illegality can be attributed to the impugned orders. In support of the said contention, reliance was placed by the learned Counsel in the case of Commissioner of Income Tax-IV v. Text Hundred India Pvt. Ltd. /b> , (2011) 197 Taxmann.128 (Del.) . wherein the Hon’ble High Court of Delhi has categorically held that: “9. It was in this backdrop, question arose as to whether the Tribunal could entertain the interest of the Revenue and allow production of those affidavits as additional evidence. The order of the Tribunal allowing additional evidence was challenged by the assessee in the High Court. The High Court took the view that the Tribunal could do so in exercise of its power under Rule 29 of the Rules. Having regard to the scope of the appeal involving the applicability of Section 52(2) of the Act to the assessee, in the opinion of the High Court, it was necessary for the Tribunal to ascertain the facts justifying such applications or otherwise and only in that view the Tribunal felt that in the interest of justice and in order to correctly adjust the liability of the assessee for payment of tax, it would be necessary to remit the matter to the Appellate Assistant Commissioner for fresh consideration on the basis of affidavits filed by the purchasers of the property. The High Court also noted that there was sufficient reason for the Revenue that the Revenue was prevented by sufficient cause for not perusing these affidavits earlier as these were available in different sections of the Department and were not made available to the Assessing Authority or even the First Appellate Authority and the assessee could not be permitted to take advantage of an inadvertent omission on the part of the Department to rely on these affidavits at the earlier stage or at the appellate stage. The ambit of rule 29 of the Rules, in the process, was discussed in the following manner:- "10. We may in this connection refer to the scope of the powers of the Tribunal under rule 29 of the Rules. In R.S.S. Shanmugam Pillai and Sons Vs. CIT (1974) 95 ITR 109 , this court had occasion to go into the question of the powers of the Tribunal to entertain or reject evidence. While accepting that the Tribunal has got a wide discretion to admit or reject documents at the stage of appeal, it was pointed out that such a discretion cannot be exercised in an arbitrary manner and that if the Tribunal found that the documents filed are quite relevant for the purpose of deciding the issue arising before, it would be well within its powers to admit the evidence, consider the same or remit the matter to the lower authorities for such consideration. On the facts of this case, the Tribunal felt that in the interest of justice in order to decide the question of the applicability of section 52(2) of the Act to the assessee which was agitate before it, it would be necessary to investigate and ascertain the facts in that regard, especially when certain affidavits had been relied on, which, to some extent, prima facie made out that more than the stated consideration had passed under the sale deeds. These affidavits would be relevant and necessary for deciding the question of the application of section 52(2) of the Act and that was the reason why the Tribunal, in the exercise of its discretion, directed the Appellate Assistant Commissioner to consider the issue afresh after taking into account the evidence in the shape of affidavits. We are of the view that the Tribunal, on the facts of this case, properly exercised its discretion. We may also refer to CIT Vs Kum Satya Setia (1983) 143 ITR 486 (MP) where it has been laid down under rule 29 of the Rules, it was within the discretion of the Tribunal to allow the production of additional evidence and even if there was a failure to produce the documents before the Income-tax Officer and the Appellate Assistant Commissioner, the Tribunal had the jurisdiction in the interest of justice to allow the production of such vital documents. That leaves for consideration the decision in Velji Deoraj and Co. That leaves for consideration the decision in Velji Deoraj and Co. Vs CIT (1968) 68 ITR 708 (Bom.). In that case while exercising its discretion, the Tribunal found that the additional evidence was unnecessary and, therefore, the refusal by the Tribunal to allow additional evidence was held to be neither illegal nor improper".” 18. It is further submitted that the Tribunal has got wide discretion to admit or reject additional evidence at the appellate stage, provided such discretion is exercised judiciously, and that if the Tribunal finds that the documents sought to be produced are quite relevant for effective determination of the issues arising before it, it would be well within its powers either to consider the same on merits or to remit the matter to the lower authority for fresh consideration. Thus, in the instant case, the learned ITAT, having found the documents relevant, has rightly admitted them and remanded the matters to the Assessing Officer, and no prejudice would be caused to the assessee thereby. 19. Reliance is also placed on the decision of the Hon’ble Supreme Court in Jyotsna Suri v. Income Tax Appellate Tribunal (2003) 128 Taxmann.com 33 (SC) wherein having been apprised of the fact that application filed under Rule 29 of the Rules was pending adjudication and the Tribunal was pleased to dispose of the main appeal without considering the same, the Hon’ble Supreme Court remitted the matter to the Tribunal to consider the application under Rule 29 on merits before disposal of the appeal, thereby recognizing the maintainability of such application, and thus, it is contended by the learned Senior Standing Counsel that the learned ITAT has rightly accepted the additional evidence. 20. The learned Senior Standing Counsel further places reliance on the judgment of the Madras High Court in Commissioner of Income Tax v. Ku. Pa. 20. The learned Senior Standing Counsel further places reliance on the judgment of the Madras High Court in Commissioner of Income Tax v. Ku. Pa. Krishnan , (2012) 25 Taxmann.com 130(Madras) wherein it was held that Rule 29 of the Rules, of course contemplates a provision that if the Tribunal requires any document to be produced or any witness to be examined or any affidavit to be filed, to enable it to pass orders for any other substantial cause, or, if the income tax authorities have decided the case without giving sufficient opportunity to the assessee, either on points specified by them or not specified by them, the Tribunal, for reasons to be recorded, may allow such documents to be produced or witness to be examined or affidavit to be filed or may allow such evidence to be adduced. It was further held that the said Rule had been interpreted by the Courts to confer a right on the assessee as well to produce additional evidence. In the light of the said decision, learned Standing Counsel would contend that as the assessee is provided with the said discretion, impliedly the Revenue has got every right to file an application under Rule 29 of the Rules. 21. Reliance is also placed by the learned Senior Standing Counsel on the decision of the Hon’ble Supreme Court in K. Venkataramaiah v. A. Seetharama Reddy & Ors. , AIR 1963 SC 1526 , wherein it was held that there can be two sets of cases, where appellate Court may allow additional evidence to be produced: one class is where the Court appealed from has refused to admit evidence, which ought to have been admitted, and the second class is where the appellate Court requires such additional evidence for itself either to enable it to pronounce judgment or for any other substantial cause; and the second class of the rule requires that when additional evidence is allowed to be produced by an appellate Court, the Court shall record the reason for its admission. 22. Reliance is also placed on the decision in the case of Carburettors Ltd. v. Asst. Comm. of Income Tax (2016) 69 Taxmann.com 384 (Madras) wherein the Division Bench of the Hon’ble High Court of Madras relying on the decision in Ku. Po. 22. Reliance is also placed on the decision in the case of Carburettors Ltd. v. Asst. Comm. of Income Tax (2016) 69 Taxmann.com 384 (Madras) wherein the Division Bench of the Hon’ble High Court of Madras relying on the decision in Ku. Po. Krishnan ’s case (supra) held that when Rule 18(4) is read with Rule 29 of the ITAT Rules, there would not be any difficulty in holding that additional evidence can be produced before the Tribunal under Rule 29. The Court further held that any additional evidence let in by the Department/Revenue must be considered before taking a final decision in the matter. In the light of the said decision, the learned Standing Counsel would submit that the facts of the present case would clearly show that the Revenue was entitled to file an application to adduce additional evidence. 23. Reliance was also placed in the case of Konda Sanjeeva Rani v. Assistant Commissioner of Income Tax , (2024) 169 Taxmann.com 591 (Telangana) wherein the Hon’ble Division Bench of this Court held that any statement made by a person during search or examination may subsequently be used as evidence in proceedings under Income Tax Act, 1922 or under Income Tax Act, 1961. It was further held that a statement recorded under Section 132(4) of the Act falls within the purview of ‘evidence’ under Section 139BD r/w Section 3 of the Indian Evidence Act, 1872. Placing reliance on the said decision, learned Senior Standing Counsel submits that as a matter of fact proceedings under Section 132(4) constitute evidence within the meaning of Section 158BD of the Act and the material seized during the search proceedings can definitely be filed by the Revenue before the Tribunal as additional evidence. 24. In conclusion, it is contended by the learned Senior Standing Counsel that as Rule 29 of the rules is procedural in nature and does not prohibit the Revenue from seeking permission to adduce additional evidence, the Revenue has got every right to file an application for leading an additional evidence and that the said right cannot be denied to the Revenue. It is also contended by the learned Senior Standing Counsel that there is no flaw or impediment in the orders passed by the learned ITAT in admitting/considering the additional evidence placed before it and remanding the matters to the Assessing Officer for fresh consideration, and thereby contended that the appeals are devoid of merit and are liable to be dismissed. 25. We have given earnest consideration to the submissions of the learned Counsel appearing on either side and perused the material on record. FINDINGS OF THE COURT: 26. Before delving into the matter, we deem it appropriate to extract Rule 29 of the Rules, which reads as under: “ Rule 29-Production of additional evidence before the Tribunal - The parties to the appeal shall not be entitled to produce additional evidence either oral or documentary before the Tribunal, but if the Tribunal requires any document to be produced or any witness to be examined or any affidavit to be filed to enable it to pass orders or for any other substantial cause, or, if the income-tax authorities have decided the case without giving sufficient opportunity to the assessee to adduce evidence either on points specified by them or not specified by them, the Tribunal for reasons to be recorded, may allow such document to be produced or witness to be examined or affidavit to be filed or may allow such evidence to be adduced. 27. A perusal of Rule 29 of the Rules, makes it clear that the very foremost words of the Rule explicitly provide that the parties to an appeal are not entitled, as a matter of right, to produce additional evidence, either oral or documentary, before the Tribunal. The Rule further makes it clear that it is the Tribunal alone, which is competent to direct either party to produce any witness to be examined or affidavit to be filed or may allow such evidence to be adduced. 28. In the instant case, the documents which are purported to be filed as additional evidence were filed at the behest of the Revenue and basing upon the said documents, the learned ITAT has remanded the matters by setting aside the orders of the Assessing Authority for fresh consideration. 29. 28. In the instant case, the documents which are purported to be filed as additional evidence were filed at the behest of the Revenue and basing upon the said documents, the learned ITAT has remanded the matters by setting aside the orders of the Assessing Authority for fresh consideration. 29. Rule 29 of the ITAT Rules, abundantly makes it clear that neither of the parties to the appeal can independently file additional evidence, either oral or documentary and it is only the Tribunal on its own can direct either of the parties to produce any documents or witness or any affidavit to be filed for determination of the dispute and if the income tax authorities decide the case without giving sufficient opportunity to the assessee either on the points specified or not specified, the Tribunal may, for reasons to be recorded, permit the production of such evidence by the assessee. The words envisaged in Rule 29, therefore leaves no scope for either the Revenue or the assessee to file applications to adduce evidence as a matter of right. Only the learned ITAT alone is empowered to direct either of the parties to produce additional evidence and only in the cases where there is total denial of giving sufficient opportunity to the assessee, the assessee has got a right to file such application seeking permission to adduce additional evidence. 30. In the instant case, the Revenue filed an application to adduce additional evidence in respect of the alleged incriminating material found in a search proceedings conducted in the appellant/assessee-company. 31. It is well settled law right from Commissioner of Income- tax v. H.H. Mir Osman Ali Khan , (1963) 48 ITR 705 (SC) to decision in State of West Bengal vs. Kesoram Industries Ltd. And Others , 2004(10) SCC 201 that statutory provisions and rules under taxing laws must be strictly interpreted. The plain language of Rule 29 would categorically emphasize that neither party has an inherent right to adduce additional evidence. The learned ITAT allowed the application filed by the Revenue in a routine manner and remanded the matter to the Assessing Authority for fresh determination, thus, in our considered opinion, the learned ITAT has exceeded its jurisdiction and acted in gross violation of Rule 29. 32. The learned ITAT allowed the application filed by the Revenue in a routine manner and remanded the matter to the Assessing Authority for fresh determination, thus, in our considered opinion, the learned ITAT has exceeded its jurisdiction and acted in gross violation of Rule 29. 32. It is, however, necessary to distinguish the decisions relied upon by the learned Senior Standing Counsel for the Revenue in the case of Carburettors Ltd. (supra), K.Venkat Ramaiah and A. Seetharam Reddy & Ors. (supra), Ku. Pa. Krishnana (supra) and in the case of Jyotsna Suri v. Income Tax Appellate Tribunal (supra), Commissioner of Income Tax v. Tech. Standard (PVT) Ltd . , (2011) 197 Taxmann.com 128 (Delhi) . In all these cases, the discretion of the Tribunal was exercised to admit additional evidence for substantial causes or where the evidence could not be produced before the lower authorities due to genuine difficulties, such as non-retrievability of emails or documents. The Tribunal, in those cases, acted after determining that the evidence was necessary for proper adjudication. So also, in Konda Sanjeevarani ’s case (supra), the Hon’ble Supreme Court vis-à-vis the Hon’ble High Court held that only when the Tribunal deemed it just and necessary for proper determination of the point arising in the appeal, additional evidence could be admitted. 33. However, many of these judgments arose under different statutory provisions, such as Order XLI Rule 27 and or other laws, and did not specifically consider Rule 29 of the Rules as that fall for consideration in the instant case. None of the judgments expressly held that either party could file an application for additional evidence as a matter of right under Rule 29. Since, the rule itself contemplates that the Tribunal on its own should call upon the parties to produce evidence or affidavits, or allow adducing evidence where necessary, or when an assessee has been denied sufficient opportunity before the lower authorities. In the instant case, the application filed by the Revenue as a matter of right, was allowed by the learned ITAT, without proper appreciation of Rule 29, which is impermissible law. Thus, all the decisions which are cited by the learned Senior Standing Counsel are distinguishable on facts and not applicable to the facts on hand. 34. In the instant case, the application filed by the Revenue as a matter of right, was allowed by the learned ITAT, without proper appreciation of Rule 29, which is impermissible law. Thus, all the decisions which are cited by the learned Senior Standing Counsel are distinguishable on facts and not applicable to the facts on hand. 34. On the other hand, the decisions relied on by the learned Senior Counsel for the assessee, in the case of Mohinder Singh Gill ’s case(supra) and Balanarsimha Reddy ’s case (supra), Malayalam Plantations Ltd. ’s case (supra), Natha Singh ’s case(supra), deal with facts closely analogous to the instant case and emphasize that Rule 29 prohibits either party from filing application for adducing additional evidence as a matter of right. 35. In view of the above findings and in the facts and circumstances of the instant case, we are of the considered view, that the impugned orders of the learned ITAT are in gross violation of procedures contemplated under Rule 29 of the Rules and the learned ITAT exceeded its jurisdiction and thus, the impugned order are liable to be set aside. 36. Accordingly, the instant appeals are allowed and the impugned orders passed by the learned ITAT in ITA.No.1463/HYD/2017 and ITA.No.164/HYD/2017, both dt.31.05.2022, are hereby set aside. No order as to costs. As a sequel, miscellaneous petitions pending, if any, shall stand closed.