DEEPAK DHANRAJ RATHOD ,MUMBAI V. ITO , WARD 42(1)(2), MUMBAI

ITA 4745/MUM/2025

AI Insights

The case involves an appeal by Deepak Dhanraj Rathod against the order of the National Faceless Appeal Centre (NFAC), which confirmed an addition of INR 33,91,500 to the Assessee's income under Section 69A of the Income Tax Act, 1961, concerning cash deposits during the demonetization period. The Assessee argued that the CIT(A) erred in confirming the action taken by the Assessing Officer and that the addition was made without a reasonable basis. The Tribunal found that the Assessee was not properly represented due to non-receipt of hearing notices, as they were issued via email post-migration to NFAC, contrary to the Assessee's preference for physical communication. Consequently, the Tribunal set aside the CIT(A)'s order and remanded the case for a fresh hearing.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 781416 (ITAT-MUMBAI)
• Duration Of Justice: 2 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-09-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2017-2018
• Appeal Filed On: 28-07-2025
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: ASSESSEE
• Keywords: Set aside; Opportunity of being heard
• Section: 143(3)

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL “D” BENCH, MUMBAI SHRI VIKRAM SINGH YADAV, ACCOUNTANT MEMBER SHRI RAHUL CHAUDHARY, JUDICIAL MEMBER ITA No.4745/MUM/2025 (Assessment Year:2017-2018) Deepak Dhanraj Rathod B/402, Pushp Vinod, S.V.Road, Near Macdonald, Borivali West Mumbai - 400092. Maharashtra. [PAN:ADXPR9776N] …………. Appellant Income Tax Officer, Ward 42(1)(2), Mumbai Kautilya Bhawan, C41-43, Avenue 3, Near Videsh Bhavan, G Block BKC, Gilban Area, Bandra Kurla Complex, Bandra East, Mumbai – 400051. Maharashtra. Vs …………. Respondent Appearance For the Appellant/Assessee For the Respondent/Department : : Shri Bharat Kumar Rajpurohit Shri Annavaran Kosuri Date Conclusion of hearing Pronouncement of order : : 29.09.2025 30.09.2025 O R D E R [ Per Rahul Chaudhary, Judicial Member: 1. The present appeal preferred by the Assessee is directed against the order, dated 23/05/2025, passed by the National Faceless Appeal Centre (NFAC), Delhi, [hereinafter referred to as ‘the CIT(A)’] whereby the Ld. CIT(A) had dismissed the appeal against the Assessment Order, dated 23/12/2019, passed under Section 143(3) of the Income Tax Act, 1961 for the Assessment Year 2017-2018. 2. The Assessee has raised following grounds of appeal : 1. On the facts and circumstances of the case in law the Ld. CIT(A) erred in confirming the action taken by AO regarding invoking Printed from counselvise.com ITA No. 4745/Mum/2025 Assessment Year 2017-2018 2 the provisions of section 69A of the Act, as same is not applicable to the facts of the case. 2. On the facts and circumstances of the case in law the Ld. CIT(A) erred in confirming addition of Rs.33,91,500/- without any reasonable basis. 3. The Assessee reserves his right to amend modify delete and make any additional grounds of appeal” 3. The relevant facts in brief are that the Assessee, a resident individual, filed return of income in the Assessment Year 2017-2018 which was selected for complete scrutiny. Assessment under Section 143(3) of the Act was framed on the Assessee vide Assessment Order, dated 23/12/2019, whereby addition of INR.33,91,500/- was made in the hands of the Assessee under Section 69A of the Act in respect of cash deposits made in the bank account of the Assessee during the demonetization period. 4. Being aggrieved, the Assessee preferred appeal before the Ld. Commissioner of Income Tax (Appeals) – 44, Mumbai in physical form. Subsequently, the appeal was migrated to National Faceless Appeal Centre (NFAC) in terms of Notification No.76 of 2020, dated 25/09/2020, issued by Central Board for Direct Taxes (CBDT), New Delhi. Vide Order, dated 23/05/2025, Ld. CIT(A) dismissed the appeal preferred by the Assessee which has been impugned by way of present appeal preferred by the Assessee. 5. The Learned Authorized Representative for the Assessee at the outset requested for setting aside of the impugned order and submitted that the Assessee had failed to make proper representation before the Ld. CIT(A) on account of non-receipt of notice of hearing. We have heard both the sides of this aspect and have perused the material on record. 6. On perusal of order passed by the Ld. CIT(A), we find that notices of hearing issued by the Ld. CIT(A) were not complied with and Printed from counselvise.com ITA No. 4745/Mum/2025 Assessment Year 2017-2018 3 therefore, the Ld. CIT(A) had dismissed the grounds raised by the Assessee observing that the Assessee had failed to discharge the onus to bring on record material/explanation in support of the contentions. We find that in the Form 35 filed in physical form the Assessee had opted for receipt of notice/communications at the address on record and not through. However, on account of migration of appeal to the NFAC, notices were issued by the Ld. CIT(A) on email. Since the Assessee could not track the appellate proceedings proper representation could not be made before the Ld. CIT(A). Given the facts and circumstances of the present case, we accept the contention of the Assessee and grant Assessee another opportunity to make out the case on merits before the Ld. CIT(A). Accordingly, we restore the issue back to the file of the Ld. CIT(A). The Order, dated 23/05/2025, passed by the Ld. CIT(A) is set aside with the directions to adjudicate the appeal afresh after granting the Assessee a reasonable opportunity of being heard. The Assessee is also directed to co- operate in the appellate proceedings and forthwith file details, documents & submission in support of its claims/contentions before the Ld. CIT(A). The Ld. CIT(A) would be at liberty to admit/consider the same as per law. It is, however, clarified that in case the Assessee fails to enter appearance and/or fails to file details/documents/submission in response to notice of hearing issued by the Ld. CIT(A), the Ld. CIT(A) shall be at liberty to decide the issues on merits on the basis of material on record. The Assessee is directed to be vigilant and track the appellate proceedings through Income Tax Business Application Portal. The Assessee is also directed to take necessary steps to bring on record the present/correct email address for communication of order/notices of the appellate proceedings before the Ld. CIT(A). In terms of the aforesaid, and without returning any findings on merits, the Ground No.1 raised by the Assessee is treated as allowed for statistical purposes, and Ground No.2 and 3 are dismissed as having been rendered Printed from counselvise.com ITA No. 4745/Mum/2025 Assessment Year 2017-2018 4 infructuous. 7. In terms of Paragraph 5 above, the appeal preferred by the Assessee is treated as allowed for statistical purposes. Order pronounced on 30.09.2025. Sd/- Sd/- (Vikram Singh Yadav) Accountant Member (Rahul Chaudhary) Judicial Member मुंबई Mumbai; िदनांक Dated : 30.09.2025 Milan, LDC Printed from counselvise.com ITA No. 4745/Mum/2025 Assessment Year 2017-2018 5 आदेश की Ůितिलिप अŤेिषत/Copy of the Order forwarded to : 1. अपीलाथŎ / The Appellant 2. ŮȑथŎ / The Respondent. 3. आयकर आयुƅ/ The CIT 4. Ůधान आयकर आयुƅ / Pr.CIT 5. िवभागीय Ůितिनिध ,आयकर अपीलीय अिधकरण ,मुंबई / DR, ITAT, Mumbai 6. गाडŊ फाईल / Guard file. आदेशानुसार/ BY ORDER, सȑािपत Ůित //True Copy// उप/सहायक पंजीकार /(Dy./Asstt. Registrar) आयकर अपीलीय अिधकरण, मुंबई / ITAT, Mumbai Printed from counselvise.com "