GAYATRI FINANCIAL SERVICES PVT LTD,MUMBAI V. ITO WARD 7(1)(1), MUMBAI, MUMBAI

ITA 842/MUM/2025

AI Insights

The case involves multiple appeals by Gayatri Financial Services Pvt. Ltd. against the orders of the Learned Additional/Joint Commissioner of Income-tax (Appeals), Chennai-2, for the assessment years 2009-10 to 2012-13. The primary contention was the rejection of the appeals due to delay and the substantive issue of double addition of income under different heads in the intimation issued under section 143(1) of the Income-tax Act. The Tribunal noted procedural lapses in the adjustments made by the Central Processing Centre (CPC), leading to the decision to allow the appeals for statistical purposes and remand the matter for fresh consideration.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 473320 (ITAT-MUMBAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-03-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: J
• Assessment Year: 2009-2010
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: ASIF KAR MALI
• Assessee Lawyers: NIRAV SHAH; VIRAJ
• Keywords: Condonation of delay; Business income; Capital Gains; Earning of tax free income
• Section: 250; 143(1); 115JB

Judgement Text

" IN THE INCOME-TAX APPELLATE TRIBUNAL “J(SMC)” BENCH, MUMBAI BEFORE MS. KAVITHA RAJAGOPAL, JUDICIAL MEMBER & SMT. RENU JAUHRI, ACCOUNTANT MEMBER आयकर अपील सं./ITA No. 842/MUM/2025 (निर्धारण वर्ा / Assessment Year :2009-10) आयकर अपील सं./ITA No. 843/MUM/2025 (निर्धारण वर्ा / Assessment Year :2010-11) आयकर अपील सं./ITA No. 844/MUM/2025 (निर्धारण वर्ा / Assessment Year :2011-12) आयकर अपील सं./ITA No. 845/MUM/2025 (निर्धारण वर्ा / Assessment Year :2012-13) Gayatri Financial Services Pvt. Ltd. A 303, Navbharat Industrial Estate, Zakaria Bunder Road, Sewri West, Mumbai-400015 v/s. बिधम ITO Ward 7(1)(1), Mumbai Aayakar Bhavan, Mumbai-400020 स्थायी लेखा सं./जीआइआर सं./PAN/GIR No: AABCG4626J Appellant/अपीलधर्थी .. Respondent/प्रनिवधदी निर्ााररती की ओर से /Assessee by: Shri Nirav Shah & Shri Viraj Bhayani रधजस्व की ओर से /Revenue by: Shri Asif Karmali सुिवधई की िधरीख / Date of Hearing 17.03.2025 घोर्णध की िधरीख/Date of Pronouncement 19.03.2025 P a g e | 2 ITA No. 842, 843, 844 & 845/Mum/2025 A.Y. 2009-10, 2010-11, 2011-12 & 2012-13 Gayatri Financial Services Pvt. Ltd. आदेश / O R D E R PER BENCH:- These appeals are filed by the assessee against the orders of the Learned Additional/Joint Commissioner of Income-tax (Appeals), Chennai-2 [hereinafter referred to as “CIT(A)”] passed u/s. 250 of the Income-tax Act, 1961 [hereinafter referred to as “Act”] for Assessment Years [A.Ys.] 2009-10, 2010- 11, 2011-12 & 2012-13. 2. The assessee has raised the following grounds of appeal: AY 2009-10 “1. On the facts and circumstances of the case and in law, the Learned Commissioner of Income Tax (Appeals) erred in rejecting the appeal filed on account to delay on filing the appeal and not considering the plea of the appellant to condone the delay. 2. (a) The learned Commissioner of Appeals erred in, confirming the intimation u/s 143(1) which determining total income of Rs. 3,40,100/- as against Rs. 1,69,094/-shown in ITR filed by the Appellant and erred in raising demand of Rs. 1,11,349/-. (b) On the circumstances, facts of the case and in law, the learned CIT(A) erred in confirming the increase of the income from business and profession by Rs. 1,71,004/- (as compared to ITR filed), in the impugned intimation u/s 143(1). (c) The Learned CIT(A) erred in not reducing the Income of Capital gain of Rs. 1,69,094/- from the computation of income from business and profession. The learned CIT(A) thereby erred in assessing the same income twice (i.e under the head business and profession and also under the head Capital Gains).” AY 2010-11 “1. On the facts and circumstances of the case and in law, the Learned Commissioner of Income Tax (Appeals) erred in rejecting the appeal filed on account to delay on filing the appeal and not considering the plea of the appellant to condone the delay. 2. (a) The learned Commissioner of Appeals erred in, confirming the intimation u/s 143(1) which determining total income of Rs. 3,22,260/- as against Rs. NIL/-shown in ITR filed by the Appellant and erred in raising demand of Rs. 1,29,478/-, P a g e | 3 ITA No. 842, 843, 844 & 845/Mum/2025 A.Y. 2009-10, 2010-11, 2011-12 & 2012-13 Gayatri Financial Services Pvt. Ltd. (b) On the circumstances, facts of the case and in law, the learned CIT(A) erred in assessing the income from business and profession at Rs. 2,76,756/- instead of actual business loss incurred by the appellant based on audited accounts.” AY 2011-12 “1. On the facts and circumstances of the case and in law, the Learned Commissioner of Income Tax (Appeals) erred in rejecting the appeal filed on account to delay on filing the appeal and not considering the plea of the appellant to condone the delay. 2. (a) The learned Commissioner of Appeals erred in, confirming the intimation u/s 143(1) which determining total income of Rs. 3,27,270/- as against 27743/- (as compared to ITR filed), in the impugned intimation u/s 143(1)/-. (b) On the circumstances, facts of the case and in law, the learned CIT(A) erred in in not reducing the Income of Capital gain, dividend income/exempt income and rent income, from the computation of income from business and profession. The learned CIT(A) thereby erred in assessing the same income twice (i.e under the head business and profession and also under the head Capital Gains, house property and exempt income).” AY 2012-13 “1. On the facts and circumstances of the case and in law, the Learned Commissioner of Income Tax (Appeals) erred in rejecting the appeal filed on account to delay on filing the appeal and not considering the plea of the appellant to condone the delay. 2. (a) The learned Commissioner of Appeals erred in, confirming the intimation u/s 143(1) which was issued by determining total income of Rs. Nil/- as against Rs. (43,250)/- shown in ITR filed by the Appellant. The learned CIT(A) also erred in confirming the calculation book profit u/s 115JB at Rs. 2,58,535/- as against Rs. -25,250/- and erred in confirming the demand of Rs. 43,300/-. (b) On the circumstances, facts of the case and in law, the learned CIT(A) erred in in not reducing the Income of dividend income/exempt income from the computation of book profit u/s 115JB of the Act and erred in determining book profit u/s 115JB at Rs.2,58,535 and erred in mentioning business income at Nil.” 3. The assessee has also taken the following additional grounds: AY 2009-10 “1) The learned assessing officer erred in not giving any notice or letter or communication to the appellant before making the adjustments or addition in intimation u/s 143(1) of the Act as compared to returned income. 2) The learned assessing officer erred in making adjustment or addition to the returned income which are not in the scope or not allowed as per the section 143(1) of the Act. The learned assessing officer also erred in not giving any details or reason or annexure for such adjustment or addition made in the intimation u/s 143(1) of the P a g e | 4 ITA No. 842, 843, 844 & 845/Mum/2025 A.Y. 2009-10, 2010-11, 2011-12 & 2012-13 Gayatri Financial Services Pvt. Ltd. Act. The learned assessing officer thereby erred in assessing the same income twice (i.e under the head business and profession and also under the head Capital Gains).” AY 2010-11 “1) The learned assessing officer erred in not giving any notice or letter or communication to the appellant before making the adjustments or addition in intimation u/s 143(1) of the Act as compared to returned income. 2) The learned assessing officer erred in making adjustment or addition to the returned income which are not in the scope or not allowed as per the section 143(1) of the Act. The learned assessing officer also erred in not giving any details or reason or annexure for such adjustment or addition made in the intimation u/s 143(1) of the Act. The learned assessing officer thereby erred in assessing the same income twice (i.e under the head business and profession and also under the head exempted Capital Gains/dividend income).” AY 2011-12 “1) The learned assessing officer erred in not giving any notice or letter or communication to the appellant before making the adjustments or addition in intimation u/s 143(1) of the Act as compared to returned income. 2) The learned assessing officer erred in making adjustment or addition to the returned income which are not in the scope or not allowed as per the section 143(1) of the Act. The learned assessing officer also erred in not giving any details or reason or annexure for such adjustment or addition made in the intimation u/s 143(1) of the Act. The learned assessing officer thereby erred in assessing the same income twice (i.e under the head business and profession and also under the head exempted Capital Gains/dividend income).” AY 2012-13 “1) The learned assessing officer erred in not giving any notice or letter or communication to the appellant before making the adjustments or addition in intimation u/s 143(1) of the Act as compared to returned income. 2) The learned assessing officer erred in making adjustment or addition to the returned income which are not in the scope or not allowed as per the section 143(1) of the Act. The learned assessing officer also erred in not giving any details or reason or annexure for such adjustment or addition made in the intimation u/s 143(1) of the Act. The learned assessing officer thereby erred in not reducing the Income of dividend income/exempt income from the computation of book profit u/s 115JB of the Act.” 4. Since the issues involved in all the four appeals are identical, these are being disposed of vide a common order and ITA No. 842/Mum/2025 AY 2009- 10 is taken up as a lead case. P a g e | 5 ITA No. 842, 843, 844 & 845/Mum/2025 A.Y. 2009-10, 2010-11, 2011-12 & 2012-13 Gayatri Financial Services Pvt. Ltd. ITA No. 842/Mum/2025 for AY 2009-10 5. The sole substantive issue involved in this appeal relates to the double addition of the same amount i.e. capital gains of Rs. 1,69,094/- at the time of issuing intimation u/s 143(1) by the Central Processing Centre [CPC] dated 22.03.2011. 6. The assessee filed an appeal against the intimation u/s 143(1) on 06.09.2024 i.e. after a delay of 4890 days. The assessee’s application for condonation of delay was rejected by the Ld. CIT(A) on the ground that it had not furnished any sufficient cause for the inordinate delay of 4890 days in filing the appeal. Accordingly, the appeal was dismissed without adjudicating on merits vide order dated 31.12.2024. 7. Aggrieved with the order of Ld. CIT(A), the assessee has filed an appeal before the Tribunal wherein he has challenged the decision of the Ld. CIT(A) in rejecting the application of condonation of delay and not considering the submissions on merit. Vide additional grounds, the assessee has submitted that Ld. AO/CPC did not give any notice or intimation to the assessee before making the adjustment in the intimation u/s 143(1) to the returned income. It has, further, been stated that the adjustment made was beyond the scope of section 143(1) of the Act. P a g e | 6 ITA No. 842, 843, 844 & 845/Mum/2025 A.Y. 2009-10, 2010-11, 2011-12 & 2012-13 Gayatri Financial Services Pvt. Ltd. Ld. DR, on the other hand, has relied on the orders of the lower authorities. 8. We have heard the rival submissions and perused the material placed before us. It is seen that the adjustment in the returned income has been made without giving due notice or opportunity to the assessee. Moreover, the reasons for adjustment have also not been stated in the intimation u/s 143(1) dated 22.03.2011. We accordingly, hold that the CPC was not justified in making the adjustment to the returned income that too without giving any opportunity/intimation to the assessee. Hence, we deem it appropriate to restore the matter to the jurisdictional AO [JAO] to consider the assessee’s contention that the same income has been taxed twice while making the adjustment to the returned income and decide the issue after giving due opportunity to the assessee. The appeal is, accordingly, allowed for statistical purposes. ITA No. 843/Mum/2025 for AY 2010-11 ITA No. 844/Mum/2025 for AY 2011-12 ITA no. 845/Mum/2025 for AY 2012-13 9. As the facts are identical in the remaining three appeals for AYs 2010-11, 2011-12 & 2012-13, the above order will apply mutatis mutandis to all the three appeals. Ld. JAO is directed to consider the assessee’s contention regarding the double addition of the same amount while making adjustments to the returned P a g e | 7 ITA No. 842, 843, 844 & 845/Mum/2025 A.Y. 2009-10, 2010-11, 2011-12 & 2012-13 Gayatri Financial Services Pvt. Ltd. income in the intimation u/s 143(1) and decide afresh after giving due opportunity to the assessee. 10. In the result, all the four appeals of the assessee are allowed for statistical purposes. Order pronounced in the open court on 19.03.2025. Sd/- Sd/- KAVITHA RAJAGOPAL RENU JAUHRI (न्यधनयक सदस्य/JUDICIAL MEMBER) (लेखधकधर सदस्य/ACCOUNTANT MEMBER) Place: म ुंबई/Mumbai दिन ुंक /Date 19.03.2025 अननक ेत स ुंह र जपूत/ स्टेनो आदेश की प्रनतनलनि अग्रेनित/Copy of the Order forwarded to : सत्यानित प्रनत //True Copy// आदेशािुसार/ BY ORDER, सहायक िंजीकार (Asstt. Registrar) आयकर अिीलीय अनर्करण/ ITAT, Bench, Mumbai. 1. अपीलार्थी / The Appellant 2. प्रत्यर्थी / The Respondent. 3. आयकर आयुक्त / CIT 4. विभागीय प्रविविवि, आयकर अपीलीय अविकरण DR, ITAT, Mumbai 5. गार्ड फाईल / Guard file. "