KARMA INDUSTRIES LIMITED,MUMBAI V. DY COMMISSIONER OF INCOME TAX CENTRAL CIRCLE 5(3), MUMBAI

ITA 3734/MUM/2025

AI Insights

Karma Industries Limited filed a series of appeals against the orders of the Commissioner of Income-tax (Appeals)-53, Mumbai, which were passed under section 250 of the Income-tax Act, 1961. The appeals pertained to the assessment years 2008-09 to 2014-15. The primary issue was the imposition of penalties under section 271(1)(c) and the rejection of the assessee's appeal on the grounds of limitation without considering the merits of the case. The Tribunal found that the assessee was denied an adequate opportunity to present its case and thus remanded the matter back to the CIT(A) for a fresh adjudication.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 714768 (ITAT-MUMBAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-08-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Assessment Year: 2010-2011
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RITESH MISHRA; AW
• Assessee Lawyers: ARNAV JARIWALA
• Keywords: Condonation of delay; Opportunity of being heard; Search and seizure
• Section: 144; 143(3); 271(1)(c); 132

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “E”, MUMBAI BEFORE SHRI ANIKESH BANERJEE, JUDICIAL MEMBER AND SHRI PRABHASH SHANKAR, ACCOUNTANT MEMBER ITA Nos 3732/Mum/2025 - A.Y. 2008-09 ITA Nos 3733/Mum/2025 - A.Y. 2009-10 ITA Nos 3734/Mum/2025 - A.Y. 2010-11 ITA Nos 3735/Mum/2025 - A.Y. 2011-12 ITA Nos 3735/Mum/2025 - A.Y. 2012-13 ITA Nos 3737/Mum/2025 - A.Y. 2013-14 ITA Nos 3738/Mum/2025 - A.Y. 2014-15 Karma Industries Limited 131, H Wing Raj Arcade, Mahavir Nagar, Kandivali West, Mumbai-400 067 PAN: AAACS7557H vs The Asst. / Deputy Commissioner of Income-tax, Central Circle 5(3) Kautilya Bhavan, B.K.C., Bandra, Mumbai-=400 051 APPELLANT RESPONDENT Assessee by : Shri Arnav Jariwala, Adv. Respondent by : Shri Ritesh Mishra, CIT DR a/w Shri Hemanshu Joshi, SR DR Date of hearing : 05/08/2025 Date of pronouncement : 0708/2025 O R D E R Per Bench: This group of appeals filed by the assessee was filed against the order of the Learned Commissioner of Income-tax (Appeals)-53, Mumbai [in short, ‘the Ld. CIT(A)] passed under section 250 of the Income-tax Act, 1961 (in short, ‘the Act’) Printed from counselvise.com 2 ITA 3732 to 3738/Mum /2025 Karma Industries Limited for Assessment Years 2008-09 to 2014-15, date of orders 29/01/2025. The impugned orders emanated from the order of the Learned Deputy Commissioner of Income-tax, Central Circle-5(3), Mumbai (for brevity, ‘the Ld.AO’) passed on 29/03/2017 under section 271(1)(c) for A.Ys 2008-09 to 2012-13; order passed on dated 30/03/2016 for 2013-14, under section 144 of the Act and order dated 28/04/2017 for A.Y. 2014-15. 2. All the appeals have same nature of facts and a common issue. All the appeals were taken together, heard together and are being disposed of by this consolidated order and ITA No.3732/Mum/2025 for A.Y.2008-09 taken as lead case. ITA No.3732/Mum/2025 (A.Y. 2008-09) 3. The Registry has reported that the appeal was filed with a delay of 59 days. The assessee has filed an application seeking condonation of the said delay. The Ld. AR has explained the reasons for the delay in filing the appeal. The Ld. DR has not raised any objection to the condonation of the delay. Accordingly, considering the submissions made, we are satisfied with the explanation offered and condone the delay of 59 days in filing the appeal. The matter is, therefore, admitted for adjudication. 4. We find that in assessee’s case, the assessment was completed under section 143(3) read with section 153C of the Act on dated 26/03/2014 with additions under different heads. The penalty proceedings were initiated under section 271(1)(c) of the Act and notice under section 274 was issued. Finally, the Ld.AO determined Printed from counselvise.com 3 ITA 3732 to 3738/Mum /2025 Karma Industries Limited the penalty @100% of the tax sought to be evaded which is amount to Rs.80,75,950/-. The aggrieved assessee filed an appeal before the Ld.CIT(A). But the Ld.CIT(A) passed an exparte order and rejected the grounds on point of limitation. The assesse had filed appeal before the Ld.CIT(A) with a delay of 623 days. 5. The Ld.AR argued that the assessee is dealing in iron and steel and has filed a return of income declaring total income amount to Rs.48,64,817/-. A search and seizure action under section 132 of the Act was conducted in the case of Shri Rajesh Mehta, director of the assessee company on 21/07/2011 and simultaneously, there was a survey action at the premises of the assessee company. The notice under section 153C of the Act has been issued to the assessee and the Ld.AO finally framed the assessment under section 143(3) read with section 153C of the Act. Pursuing the addition in the assessment order, the penalty was levied amount to Rs.80,75,950/-. The Ld.AR prayed that the assessee was unable to submit the documents and the evidence before the Ld.CIT(A). So, the Ld.AR prayed for restoring the matter to the file of the Ld.CIT(A) for further adjudication de novo. 6. The Ld. DR advanced arguments but did not raise any serious objection to the submission made by the Ld. AR seeking restoration of the matter to the file of the Ld. CIT(A). 7. We heard the rival submissions and considered the documents available on the record. It is noted that the appeal before the Ld.CIT(A) was filed with a delay of delay of 623 days. The Ld.CIT(A), however, rejected the appeal solely on the Printed from counselvise.com 4 ITA 3732 to 3738/Mum /2025 Karma Industries Limited ground of limitation for contravening section 249(2) of the Act without dealing with the merits of the case. In our considered view, while there was a delay in filing the appeal before the Ld.CIT(A), the appeal ought not to have been dismissed without considering the reasons for delay and without affording a reasonable opportunity of being heard. The assessee was denied of adequate opportunity before the Ld.CIT(A) in appeal proceedings. Accordingly, we deem it appropriate to remand the matter to the file of Ld.CIT(A) with a direction to consider the assessee’s request for condonation of delay of 623 days in filing the appeal and adjudicating the appeal afresh in accordance with law. The assessee is also directed to furnish all the relevant documents before the Ld. CIT(A) for proper appreciation of the facts. 8. We make it clear that we have not expressed any opinion on merits of the case so as not to prejudice the proceedings before the Ld. CIT(A). Needless to say, the Ld. CIT(A) shall afford a reasonable opportunity of being heard to the assessee before passing a fresh appellate order. The assessee is also directed to be diligent and fully co-operative in remand proceedings to enable early disposal of the appeal. 9. The appeal of the assesse bearing ITA No.3732/Mum/2025 is allowed for statistical purpose. ITAs 3733 to 3738/Mum/2025 (AYs 2009-10 to 2014-15) 10. The facts and circumstances in these appeals are identical to the appeal decided above. Therefore, the decision arrived at therein shall apply mutatis mutandis to these appeals also. Printed from counselvise.com 5 ITA 3732 to 3738/Mum /2025 Karma Industries Limited 11. In the result, the appeal filed by the assessee bearing ITAs 3732 to 3738/Mum/2025 are allowed for statistical purpose. Order pronounced in the open court on 07th day of August 2025. Sd/- sd/- (PRABHASH SHANKAR) (ANIKESH BANERJEE) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai, िदनांक/Dated: 07/08/2025 Pavanan Copy of the Order forwarded to: 1. अपीलाथ /The Appellant, 2. ितवादी/ The Respondent. 3. आयकर आयु\u0014 CIT 4. िवभागीय ितिनिध, आय.अपी.अिध., मुबंई/DR, ITAT, Mumbai 5. गाड फाइल/Guard file. BY ORDER, //True Copy// (Asstt. Registrar), ITAT, Mumbai Printed from counselvise.com "