BRAIN WAVE INC. ,MUMBAI V. INCOME TAX OFFICER WARD 25(2)(1), MUMBAI

ITA 9077/MUM/2025

AI Insights

The case involves Brain Wave Inc., a partnership firm engaged in the business of installation of sign boards and various digital printings, which appealed against the order of the Commissioner of Income Tax (Appeals) at the National Faceless Appeal Centre, Delhi. The appeal was concerning the assessment year 2017-18, where the Assessing Officer had made additions under Section 69A of the Income-tax Act, 1961, due to unexplained cash deposits. The assessee challenged the validity of the reassessment proceedings and the additions made. Initially, both the Assessing Officer and the CIT(A) dismissed the assessee's submissions, leading to the current appeal before the Tribunal.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 847749 (ITAT-MUMBAI)
• Duration Of Justice: 2 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-03-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Mumbai
• Assessment Year: 2017-2018
• Appeal Filed On: 24-12-2025
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SWAPNIL CHOUDHARI
• Assessee Lawyers: KETAN L. VAJANI
• Keywords: Set aside; Opportunity of being heard; Reassessment proceedings; Reopening of assessment
• Section: 147

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH, MUMBAI BEFORE SHRI SANDEEP GOSAIN, JUDICIAL MEMBER AND SHRI JAGADISH, ACCOUNTANT MEMBER ITA No. 9077/Mum/2025 Assessment Year: 2017-18 Brain Wave Inc. Ground Floor, Neel Kamal, N.S. Road No.2, Juhu Scheme, Vile Parle (West), Mumbai- 400049 PAN: AANFB2480N Vs. Income Tax Officer Ward 25(2)(1) Kautilya Bhavan, Bandra-Kurla Complex, Bandra (East), Mumbai-400051 (Appellant) (Respondent) Assessee by Shri Ketan L. Vajani Department by Shri Swapnil Choudhari (SR. AR.) Date of Hearing 17.03.2026 Date of Pronouncement 23.03.2026 ORDER Per: SHRI JAGADISH, A.M.: 1. This appeal is filed by the assessee against the order dated 18.06.2025 passed by the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi for the assessment year 2017-18 arising out of the assessment order passed by the Assessing Officer under section 147 of the Income-tax Act, 1961. Printed from counselvise.com ITA No.9077/M/2025 Brain Wave Inc. 2 2. The assessee has raised grounds in the appeal challenging the validity of reassessment proceedings as well as the addition made by the Assessing Officer on account of cash deposited by the appellant as unexplained money. 3. Briefly stated, the facts of the case are that the assessee is a partnership Firm engaged in the business of installation of sign boards and various digital printings. The assessee-firm filed its return of income for the assessment year 2017-18 on 28.03.2018 declaring total income of Rs.16,80,820/-. The Assessing Officer issued as many as five notices between 17.01.2023 to 04.05.2023, however, the assessee failed to comply with the said notices. Accordingly, the Assessing Officer passed an ex parte order making addition under Section 69A of the Act. 4. Aggrieved by the assessment order, the assessee preferred an appeal before the learned CIT(A). During the appellate proceedings, the learned CIT(A) issued several notices. However, according to the learned CIT(A), the assessee failed to furnish necessary submissions in support of the grounds of appeal. Therefore, the learned CIT(A) dismissed the appeal ex parte and confirmed the addition made by the Assessing Officer. Aggrieved, the assessee is in appeal before this Tribunal. 5. Before us, the learned Authorised Representative submitted that the learned CIT(A) passed the impugned order without adjudicating the issues on merits and dismissed the appeal ex parte. It was submitted that the assessee could not properly respond during the faceless appellate proceedings and therefore requested that one more opportunity may be granted in the interest of justice to present the case before the first appellate authority. Printed from counselvise.com ITA No.9077/M/2025 Brain Wave Inc. 3 6. The learned Departmental Representative, on the other hand, supported the order of the learned CIT(A) and submitted that adequate opportunities were granted during the appellate proceedings but the assessee failed to avail the same. Therefore, according to the learned DR, the order passed by the learned CIT(A) does not call for any interference. 7. We have heard the rival submissions and perused the material available on record. It is observed that the learned CIT(A) has dismissed the appeal primarily on the ground that the assessee did not furnish necessary submissions despite opportunities provided during the appellate proceedings. However, from the impugned order it is evident that the issues raised by the assessee in the grounds of appeal, including the challenge to reopening of assessment and the addition made under section 69A of the Act, have not been adjudicated on merits. 8. Considering the facts and circumstances of the case, and in order to meet the ends of substantial justice, we are of the considered view that the assessee deserves one more opportunity to present the case before the learned CIT(A). Accordingly, we set aside the impugned order of the learned CIT(A) and restore the matter to his file with a direction to adjudicate the appeal afresh on merits after providing adequate opportunity of being heard to the assessee. 9. The assessee is also directed to cooperate in the appellate proceedings and promptly furnish all necessary details and submissions as may be called for by the learned CIT(A). It is made clear that in the event of failure on the part of the assessee to comply with the notices issued, the learned CIT(A) shall be at liberty to decide the appeal on the basis of material available on record. Printed from counselvise.com ITA No.9077/M/2025 Brain Wave Inc. 4 10. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open court on 23/03/2026. Sd/- Sd/- (SANDEEP GOSAIN) Judicial Member (JAGADISH) Accountant Member Mumbai, Dated: 23/03/2026 Ashwani Rao Sr. Private Secretary Copy of the order forwarded to: 1. Appellant 2. Respondent 3. The CIT 4. The CIT (Appeals) 5. The DR, I.T.A.T. By order (Assistant Registrar) ITAT, Mumbai Printed from counselvise.com "