LAKHANI BUILDERS PVT LTD,MUMBAI V. ACIT 28(3), MUMBAI

ITA 6949/MUM/2024

AI Insights

Lakhani Builders Pvt. Ltd. filed an appeal against the order of the Commissioner of Income-tax (Appeals), which had dismissed their earlier appeal ex parte due to non-compliance. The original dispute involved the assessment of income and profit calculations related to a construction project for the Assessment Year 2018-19. The Assessing Officer (AO) had made several adjustments to the reported income and project costs, which the assessee contested. The Tribunal found that the assessee had not received proper notice of the CIT(A)'s order, leading to the decision to remand the case for a fresh hearing.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 312369 (ITAT-MUMBAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-04-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2018-2019
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RAM KRISHN KEDIA
• Assessee Lawyers: R I TI KA AGAR WA L
• Keywords: Condonation of delay; Depreciation; Principle of natural justice
• Section: 271(1)(c)

Judgement Text

" IN THE INCOME-TAX APPELLATE TRIBUNAL “A” BENCH, MUMBAI BEFORE MS. KAVITHA RAJAGOPAL, JUDICIAL MEMBER & SMT. RENU JAUHRI, ACCOUNTANT MEMBER आयकर अपील सं./ITA No. 6949/MUM/2024 (निर्धारण वर्ा / Assessment Year :2018-19) Lakhani Builders Pvt. Ltd. 1801, Satra Plaza, Plot No. 20, Sector 19D, Vashi, Navi Mumbai-400703 v/s. बिधम ACIT 28(3), Mumbai Mumbai-400703 स्थायी लेखा सं./जीआइआर सं./PAN/GIR No: AABCL6926A Appellant/अपीलधर्थी .. Respondent/प्रनिवधदी निर्ााररती की ओर से /Assessee by: Ms. Ritika Agarwal रधजस्व की ओर से /Revenue by: Shri Ram Krishn Kedia सुिवधई की िधरीख / Date of Hearing 16.04.2025 घोर्णध की िधरीख/Date of Pronouncement 30.04.2025 आदेश / O R D E R PER RENU JAUHRI [A.M.] :- This appeal is filed by the assessee against the order of the Learned Commissioner of Income-tax (Appeals), Mumbai/National Faceless Appeal Centre, Delhi [hereinafter referred to as “CIT(A)”] dated 18.03.2024 passed u/s. 250 of the Income-tax Act, 1961 [hereinafter referred to as “Act”] for Assessment Year [A.Y.] 2018-19. 2. The assessee has raised the following grounds of appeal: “1. BECAUSE, the AO has erred in law and on facts in calculating a profit of Rs.672,34,498/- from the project as at 31/03/2018 by erroneously considering P a g e | 2 ITA No. 6949/Mum/2024 A.Y. 2018-19 Lakhani Builders Pvt. Ltd. the cost of construction as Rs.36,70,22,237/- instead of Rs.44,32,01,883/-and Percentage of completion as 62.57% instead of 51.80%. 2 BECAUSE, the AO has erred in law and on facts in erroneously treating the entire revenue of Rs.36,71,91,655/- from the project as Appellant's share instead of taking 50% as per the Development Agreement with the Land Owner. 3. Without prejudice to above, on the facts and circumstances of the case, the AO has erred in assessing the income for the year at Rs.3,60,78,135 (Rs.672,34,498 less Rs.3,11,56,363) purely on the basis of presumptions and assumptions of facts as well as law. 4. BECAUSE, the AO has erred in considering profit on sale of depreciable asset of Rs.7.74.478/- as income of the assessee whereas the surplus is already considered in block of assets while calculating depreciation u/s. 50 of the Income Tax Act, 1961. 5. BECAUSE, the CIT(A) has erred in law and on facts in passing an order in sub silentio without dealing with either the grounds of appeal filed by the Appellant or the statement of facts which remained unrebutted.” 3. At the outset, we observe that the present appeal has been filed with a delay of 225 days. In order to explain the delay, the assessee has submitted an affidavit stating that the appellate order under section 250 of the Income Tax Act, 1961, was passed by the Ld. CIT(A) on 18.03.2024. However, a physical copy of the order was not received by the assessee. The notices for the hearing, as well as the impugned order, were sent to the email addresses of the appellant's office, viz. [e-mail] and [e-mail], which were inadvertently missed by the assessee. It was only when the assessee's accountant received a show cause notice under section 271(1)(c) of the Act on 05.12.2024 that the assessee became aware of the appellate order. Subsequently, the assessee consulted its tax consultant, who advised the filing of appeal as expeditiously as possible along with a petition for condonation of delay. P a g e | 3 ITA No. 6949/Mum/2024 A.Y. 2018-19 Lakhani Builders Pvt. Ltd. 4. In view of the facts narrated in the affidavit of the assessee, we find that there was a reasonable explanation given for the delay in filing the appeal. Accordingly, we hereby condone the delay of 225 days in filing the appeal before the Tribunal. 5. Brief facts of the case are that the assessee filed return declaring an income of Rs. 2,93,93,870/- on 26.10.2018. Subsequently, the case was selected for scrutiny, and the Learned Assessing Officer (Ld. AO) issued various notices to the assessee. However, due to lack of compliance from the assessee, the assessment was completed under section 143 r.w.s. 144B of the of the Act on 23.09.2021, determining the total income to be Rs. 6,62,46,483/-. 6. Aggrieved by the order of the Ld. AO, the assessee preferred an appeal before the Ld. CIT(A). The Ld. CIT(A) also issued several notices to the assessee, but no response was received. Subsequently, the Ld. CIT(A) passed an exparte order dismissing the assessee's appeal. 7. Aggrieved by the order of the Ld. CIT(A), the assessee has filed the present appeal belatedly before this Tribunal. Before us, the Learned Authorised Representative (Ld. AR) submitted that the notices and the order of the Ld. CIT(A) were sent to the official email address of the assessee and were inadvertently missed. The Ld. AR argued that, for the same reasons detailed in the affidavit filed for condonation of delay in the present appeal, the assessee could not make any compliance before the Ld. CIT(A). Therefore, the Ld. AR P a g e | 4 ITA No. 6949/Mum/2024 A.Y. 2018-19 Lakhani Builders Pvt. Ltd. requested that the matter be remanded back to the Ld. CIT(A) for fresh adjudication. 8. The Learned Departmental Representative (Ld. DR) has not objected to the proposition put forth by the Ld. AR. 9. We have considered the rival submissions and carefully examined the material on record. In the interest of natural justice and to afford the assessee a fair opportunity to present its case, we deem it appropriate to restore the matter to the file of the Ld. CIT(A) for fresh adjudication on its merits. The Ld. CIT(A) is hereby directed to provide the assessee with due opportunity to present its case. The assessee is also directed to provide the correct and active email address to the Ld. CIT(A) and to ensure complete and timely compliance with all requirements before the Ld. CIT(A). 10. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open court on 30.04.2025. Sd/- Sd/- KAVITHA RAJAGOPAL RENU JAUHRI (न्यधनयक सदस्य/JUDICIAL MEMBER) (लेखधकधर सदस्य/ACCOUNTANT MEMBER) Place: म ुंबई/Mumbai दिन ुंक /Date 30.04.2025 अननक ेत स ुंह र जपूत/ स्टेनो आदेश की प्रनतनलनि अग्रेनित/Copy of the Order forwarded to : P a g e | 5 ITA No. 6949/Mum/2024 A.Y. 2018-19 Lakhani Builders Pvt. Ltd. 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. सत्यानित प्रनत //True Copy// आदेशािुसार/ BY ORDER, सहायक िंजीकार (Asstt. Registrar) आयकर अिीलीय अनर्करण/ ITAT, Bench, Mumbai. "