DOMET TRADING PRIVATE LIMITED,MUMBAI V. DCIT-5(1)(2), MUMBAI, MUMBAI

ITA 5482/MUM/2025

AI Insights

Domet Trading Private Limited appealed against the order of the National Faceless Appeal Centre (NFAC), which had dismissed their appeal due to a delay in electronic filing. The Tribunal examined the procedural validity of the reassessment notice issued under section 148 and the subsequent additions made under section 68 concerning unexplained cash credits. The Tribunal noted that the initial notice was incorrectly dated and the corrigendum was issued after the statutory deadline, leading to the quashing of the reassessment order.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 789906 (ITAT-MUMBAI)
• Duration Of Justice: 2 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-11-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: misc
• Appeal Filed On: 01-09-2025
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANNAVARAN KOSURI
• Assessee Lawyers: RAJ KUMAR SINGH
• Keywords: Condonation of delay; Set aside; Reassessment proceedings; Unexplained cash credit; Bonafide belief; Accommodation entries; Bogus
• Section: 147; 148; 144; 68

Judgement Text

"IN THE INCOME-TAX APPELLATE TRIBUNAL “D” BENCH, MUMBAI BEFORE SMT BEENA PILLAI, JUDICIAL MEMBER & SMT.RENU JAUHRI, ACCOUNTANT MEMBER ITA No.5482/MUM/2025 7 (A.Y.2008-09) Domet Trading Private Limited Shop No. B/1, Ground Floor, Mahavir Darshan Saidham, 3rd Kumbharwada lane, Grigaon, Mumbai-400004. Vs. DCIT-5(1)(2) Aayakar Bhavan, Maharishi Karve road, Mumbai-400020. \u0001थायी लेखा सं./जीआइआर सं./PAN/GIR No:AACCD5181C Appellant .. Respondent Appellant by : Shri Rajkumar Singh Respondent by : Shri Annavaran Kosuri- Sr. AR Date of Hearing 20.11.2025 Date of Pronouncement 24.11.2025 आदेश / O R D E R PER RENU JAUHRI [A.M.] :- This appeal is filed by the assessee against the order of the National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as “CIT(A)”] dated 11.07.2025 passed u/s. 250 of the Income-tax Act, 1961 [hereinafter referred to as “Act”] for Assessment Year [A.Y.] 2008-09. Printed from counselvise.com P a g e | 2 ITA NO. 5482/mum/2025. 2. The grounds of appeal are as follows: “1. That on facts and circumstances of the case and in law the Id. C.I.T. (Appeals), NFAC, Delhi has erred in dismissing the appeal of assessee stating only half facts in respect of delay taken place in filing the appeal electronically by deliberating hiding the crucial fact that physical appeal Form No.35 in the case was filed well within the prescribed time by Statute when due to technical glitches in the system of department electronic filing of appeal within that period was not getting through. 2. That while dismissing the e-filed appeal of assessee for delayed filing the Id. C.I.T. (Appeals), NFAC, Delhi has erred in not appreciating that physical appeal in Form No.35 against the impugned assessment order was filed well within the prescribed period under relevant provisions of the Act and acceptance of physical appeal filed, by the Id. Appellate jurisdictional Commissioner (AJC), has lead the assessee appellant to harbor the bonafide belief that appeal filed by it in physical form was a valid appeal, more particularly in absence of any intimation or notice of any defect in this regard from the Office of Id. AJC. 3. That the bonafide belief of assessee appellant stated in appeal ground no.2 is getting duly fortified from the fact that the notice of hearing u/s.250 in the physical appeal filed by it was issued by the office of Id. AJC and was attended by its authorized representative from time to time and it was only when the AR informed the appellant that the physical appeals filed after the notified dates are getting dismissed on technical grounds of not being filed electronically, the dismissed e-appeal contested in the above appeal before Hon'ble ITAT was filed imunediately along with the application for condonation of delay taken place as provided under the Act. 4. That the Id. C.I.T. (Appeals), NFAC, Delhi ought to have admitted the appeal condoning the delay taken place in presenting the appeal electronically for sufficient and reasonable reasons and decided the appeal grounds raised contesting on legal issues and merits of the case. 5. That the reassessment order dated 21-03-2016 passed u/s.144 r.w.s. 147 in absence of a notice under section 148 being ever issued by ld. Assessing Officer before framing of impugned assessment order is without jurisdiction and patently illegal hence may be quashed and set aside. 6. That even on merit of the case addition made and confirmed u/s 68 at Rs.63,77,622/-in respect of unsecured loans inclusive of interest payable thereon taken from M/s. Navkar Diamonds of Rs.10,61,099/- and from M/s. Mohit Enterprises of Rs.53,16,523/- alleged to be hawala entry provider concern of M/s. Bhanwarlal Jain Group only on the basis of information received from DGIT (Inv.), Mumbai without doing any independent investigation or verification of his own or bringing any adverse material on record. 7. That all the appeal grounds raised are independent grounds and without prejudice to each other. 8. That the appellant craves the leave to amend, alter, substitute and or to raise new or additional grounds of appeal at the time of hearing.” Printed from counselvise.com P a g e | 3 ITA NO. 5482/mum/2025. 3. Brief facts of the case are that the assessee company filed its return for A.Y. 2008-09 on 01.10.2010 declaring total income of Rs. 13,98,057/-. Based on information received by the department regarding accommodation entries taken by the assessee, the case was reopened u/s. 148 of the Act. However, in the notice dated 23.02.2015, the assessment year was wrongly mentioned as A.Y. 2009-10. Subsequently, vide corrigendum letter dated 07.04.2015, the ld. AO conveyed to the assessee that assessment year should be read as A.Y. 2008-09 instead of A.Y. 2009-10 which was inadvertently mentioned in the earlier notice. Thereafter, assessment was completed u/s. 144 r.w.s 147 of the Act vide order dated 21.03.2016 at an income of Rs. 77,75,680/- after making addition of Rs. 63,77,622/- u/s. 68 on account of unexplained cash credits. Aggrieved, the assessee filed an appeal before the ld. CIT(A). Ld. CIT(A) noted that there was a delay of 1037 days in filing of appeal. Not satisfied with the assessee’s explanation citing technical glitch in the e- filing software of the department, ld. CIT(A) did not condone the delay and dismissed the appeal in limine. Further aggrieved, the assessee has filed an appeal before the Tribunal. 4. Before us, ld. AR has submitted that the appeal was filed in physical format on 20.04.2016, which was within time. However, on migration to e-appeal portal, the assessee was required to file the appeal on the e- portal but the same could not be done due to glitches in the software of Printed from counselvise.com P a g e | 4 ITA NO. 5482/mum/2025. the department. Hence, ld. CIT(A) was not justified in dismissing the appeal on ground of delay, as the appeal was filed on time in physical mode. Further, ld. AR has argued that there was no valid notice issued, u/s. 148 within the prescribed time limits. The last date to issue notice u/s. 148 was 31.03.2015 for A.Y. 2008-09. However, notice dated 23.02.2015 did not mention the correct assessment year. Even the corrigendum was issued after 31.03.2015 thus till 31.03.2015, no valid notice for the impugned assessment year had been issued to the assessee and hence the proceedings are liable to be quashed. Moreover, even on merits, ld. AR argued that the impugned addition was not justified as the same had been made simply on the basis of report received from the investigation wing and no independent enquiry or verification was made by the ld. AO. Lastly, ld. AR has pointed out that the mandatory notice u/s. 143(2) was not issued to the assessee during the reassessment proceedings. 4.2 On the other hand, ld. DR has strongly relied on the orders of the lower authorities and submitted that the error in mentioning the assessment year was inadvertant and the same stood rectified vide corrigendum letter issued on 23.04.2013. He further pointed out that detailed investigation was made by the Investigation wing in the Bhanwarlal Jain Group of cases during which it was found that the assessee had taken bogus accommodation entries from the entities of the search group. Printed from counselvise.com P a g e | 5 ITA NO. 5482/mum/2025. 5. We have heard the rival submissions and perused the material placed a record. From the facts mentioned in the assessment order itself, it is clear the till 31.03.2015, there was no valid 148 notice issued in the case of the assessee and therefore the entire proceedings are liable to be quashed. We are of the considered opinion that the corrigendum issued on 23.04.2015 i.e after the limitation date, cannot cure the material defect and hence as on 31.03.2015, no valid notice u/s. 148 had been issued to the assessee. Under the circumstances, we hereby quash the proceedings u/s. 148. Since the notice itself stands quashed, other grounds of appeal are rendered academic and hence are not being adjudicated upon. 6. In the result, appeal of the assessee is allowed. Order Pronounced in Open Court on 24.11.2025 Sd/- Sd/- (BEENA PILLAI) (RENU JAUHRI) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) Place: Mumbai Date 24.11.2025 Anandi.Nambi/STENO आदेश की \u0015ितिलिप अ\u001aेिषत/Copy of the Order forwarded to : 1. अपीलाथ\b / The Appellant 2. थ\b / The Respondent. 3. आयकर आयु\u0011 / CIT Printed from counselvise.com P a g e | 6 ITA NO. 5482/mum/2025. 4. िवभागीय ितिनिध, आयकर अपीलीय अिधकरण DR, ITAT, Mumbai 5. गाड\u001b फाईल / Guard file. स ािपत ित //True Copy// आदेशानुसार/ BY ORDER, उप/सहायक पंजीकार (Dy./Asstt. Registrar) आयकर अपीलीय अिधकरण/ ITAT, Bench, Mumbai. Printed from counselvise.com "