ABSOTHERM SERVICES PRIVATE LIMITED,THANE WEST V. DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-1, THANE, THANE WEST

ITA 1534/MUM/2025

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Absotherm Services Private Limited appealed against the order of the Commissioner of Income Tax (Appeals), which upheld the addition of Rs. 11,62,74,516 to the assessee's income as determined by the AO. The addition was based on discrepancies between the receipts reported in the assessee's Profit & Loss account and those recorded in Form 26AS. The Tribunal noted the assessee's non-compliance in previous proceedings but decided to give another opportunity to present its case, emphasizing the principles of natural justice.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 312386 (ITAT-MUMBAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-04-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2011-2012
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K.R. SUBHASH
• Assessee Lawyers: B. N. RAO
• Keywords: Period of limitation; Principle of natural justice
• Section: 144; 143(3)

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, MUMBAI BEFORE MS. KAVITHA RAJAGOPAL, JM AND SMT. RENU JAUHRI, AM ITA No. 1534/Mum/2025 (Assessment Year: 2011-12) Absotherm Services Private Limited B/1, Tara Niwas, Near Brahman English School, Mumbai – 400602. Vs. DCIT Circle-1, Thane PAN/GIR No. AAGCA0631A (Appellant) : (Respondent) Assessee by : Shri. B. N. Rao Respondent by : DR. K. R. Subhash (CIT-DR) Date of Hearing : 16.04.2025 Date of Pronouncement : 30.04.2025 O R D E R Per Kavitha Rajagopal, J M: This appeal has been filed by the assessee, challenging the order of the learned Commissioner of Income Tax (Appeals) Delhi (‘ld. CIT(A)’ for short), National Faceless Appeal Centre (‘NFAC’ for short) passed u/s.250 of the Income Tax Act, 1961 (‘the Act'), pertaining to the Assessment Year (‘A.Y.’ for short) 2011-12. 2. It is observed that this appeal has been filed belatedly with a delay of 459 days beyond the period of limitation for which the assessee has filed an application for condoning the said delay. On perusal of the same, we deem it fit to hold that the assessee had ‘sufficient cause’ for the delay and we therefore condone the delay caused in filing the present appeal. 3. The assessee has raised the following grounds of appeal: ITA No. 1534/Mum/2025 (A.Y. 2011-12) Absotherm Services Pvt. Ltd. 2 “1. Ld. Commissioner of Income tax (Appeals) erred in upholding the addition of Rs. 11,62,74,516 made by the Assessing Officer 2. Ld. Commissioner of Income tax (Appeals) erred in not providing sufficient opportunity to the Appellant” 2. Brief facts of the case are that the assessee is a private limited company and had filed its return of income dated 30.11.2011, declaring total income at Rs. Nil and showing current year loss of Rs. 2,72,67,599/- and had subsequently revised its return of income dated 29.09.2012, declaring total loss of Rs. 1,48,00,900/-. The assessee’s case was selected for scrutiny and scrutiny assessment u/s. 143(3) was passed on 19.03.2014. Notice u/s. 143(2) r.w.s. 254 of the Act was issued on 28.08.2019, requesting the assessee to furnish the details to reconcile the receipts of Rs. 18,32,75,066/- as per 26AS and receipts of Rs. 6,70,00,550/- as per P & L account in F.Y. 2010-12. As the assessee failed to furnish the complete details of reconciling the receipts as per 26AS and receipts as per P & L account inspite of several opportunities, the ld. AO treated the difference of the above receipts i.e., Rs. 11,62,74,516/- as income of the assessee and added to the total income of the assessee. The ld. AO had passed the assessment order u/s. 144 r.w.s. 254 of the Act dated 09.12.2019, declaring total income at Rs. 10,34,51,480/- after making addition of Rs. 11,62,74,516/-. 4. Aggrieved the assessee was in appeal before the first appellate authority, who vide an ex parte order dated 29.09.2023, upheld the addition made by the ld. AO on the ground that the assessee has been non-compliant and has failed to substantiate its claim. 5. The assessee is in appeal before us, challenging the impugned order of the ld. CIT(A) on the above-mentioned grounds. ITA No. 1534/Mum/2025 (A.Y. 2011-12) Absotherm Services Pvt. Ltd. 3 6. We have heard the rival submissions and perused the materials available on record. It is observed that this is the second round of proceedings, where the assessee has preferred this present appeal challenging the order of the ld. CIT(A). It is observed that the assessee has been non-compliant throughout the proceeding before the first appellate authority and had failed to furnish any explanation along with any supporting documentary evidence in support of its claim. 7. The learned Authorised Representative (ld. AR for short) for the assessee contended that the assessee has got a good case on the merits and prayed that the assessee may be given one more opportunity to present its case before the lower authorities. 8. The learned Departmental Representative (ld. DR for short) for the revenue on the other hand vehemently opposed to setting aside the issue to the lower authorities for the reason that the assessee was given sufficient opportunity before the ld. AO as well as before the ld. CIT(A) but has not availed of the same. The ld. DR relied on the order of the lower authorities. 9. In the above facts of the case, we are of the considered opinion that the assessee may be given one more opportunity to present its case before the ld. AO by furnishing the documentary evidence proposed to be filed by the assessee in order to substantiate its claim. On considering the fact that the assessee has been non-compliant throughout the proceeding before the lower authorities, we deem it fit to impose a cost of Rs. 10,000/- for the recalcitrant attitude of the assessee, which has to be deposited within one month from the date of receipt of this order to the Prime Minister Relief Fund. We therefore remand all these issues back to the file of the ld. AO by adhering to the principles of ITA No. 1534/Mum/2025 (A.Y. 2011-12) Absotherm Services Pvt. Ltd. 4 natural justice and in the interest of justice dispensation. The ld. AO is directed to consider the submission of the assessee and to pass a de novo assessment order on the merits of the case and in accordance with law and the assessee is also directed to strictly adhere to the proceedings before the ld. AO. 10. In the result, the appeal filed by the assessee is allowed for statistical purpose. Order pronounced in the open court on 30.04.2025 Sd/- Sd/- (RENU JAUHRI) (KAVITHA RAJAGOPAL) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai; Dated: 30.04.2025 Karishma J. Pawar (Stenographer) Copy of the Order forwarded to: 1. The Appellant 2. The Respondent 3. CIT- concerned 4. DR, ITAT, Mumbai 5. Guard File BY ORDER, (Dy./Asstt.Registrar) ITAT, Mumbai "