M/S. NAV DURGA CONSTRUCTION COMPANY ,MUMBAI V. ITO WARD 27(2), MUMBAI

ITA 8828/MUM/2025

AI Insights

M/s. Nav Durga Construction Company appealed against the order of the Learned Commissioner of Income Tax (Appeals) at the National Faceless Appeal Centre, which had upheld various additions made by the Assessing Officer under sections 68 and 144B of the Income Tax Act, 1961. These additions included substantial amounts added to the assessee's income under the heads of business income, sundry creditors, and unsecured loans, due to the assessee's failure to provide adequate documentary evidence. The tribunal noted the assessee's non-compliance and lack of representation but decided to remand the case for a fresh examination, providing the assessee another opportunity to present its case.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 840288 (ITAT-MUMBAI)
• Duration Of Justice: 2 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-02-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2022-2023
• Appeal Filed On: 19-12-2025
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: YOGESH KAMAT
• Keywords: Business income; Opportunity of being heard; Period of limitation
• Section: 143(3); 68

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH, MUMBAI BEFORE SHRI OM PRAKASH KANT, AM AND MS. KAVITHA RAJAGOPAL, JM ITA No.8828/Mum/2025 (Assessment Year: 2022-23) M/s. Nav Durga Construction Company, 234, 235 & 236, Big Splash, Sector -17, Vashi, Navi Mumbai Raigarh Maharashtra– 400 703 Vs. Income Tax Officer-27(2), IT Office, Vashi Railway Station Building, Navi Mumbai Maharashtra – 400 703 PAN: AADFN0867H (Appellant) : (Respondent) Assessee by : None Respondent by : Shri Yogesh Kamat, CIT-DR Date of Hearing : 25.02.2026 Date of Pronouncement : 27.02.2026 O R D E R Per Kavitha Rajagopal, JM: This appeal is filed by the assessee, challenging the order of the Learned Commissioner of Income Tax [‘Ld. CIT(A)’ for short], National Faceless Appeal Centre (‘NFAC’ for short) passed u/s. 250 of the Income Tax Act, 1961 (‘the Act') pertaining to the Assessment Year (‘A.Y.’ for short) 2022-23. 2. As there was no representation on behalf of the assessee, we hereby proceed to dispose of this appeal by hearing the Learned Departmental Representative (‘Ld. DR’ for short) and on perusal of the materials available on record. Further, it is observed that the present appeal has been filed belatedly with a delay of 48 days, for which the assessee has filed an application for condoning the delay along with an affidavit. On perusal of the Printed from counselvise.com ITA No.8828/Mum/2025 M/s. Nav Durga Construction Company 2 same, we deem it fit to condone the delay as there being ‘sufficient cause’ for the delay in filing the present appeal beyond the period of limitation. Delay is condoned. 3. The assessee has raised the following grounds of appeal: “1. The learned Assessing Officer has passed order under Section 144B of the Act, without giving any reasonable opportunity of being heard and same is upheld by CIT (Appeals). 2. Assessing Officer has erred in making the addition of Rs.5,94,28,000/-towards sale proceeds/ reflected in GST RI without considering the facts and circumstances of the case and same is upheld by CIT(Appeals). 3. The learned Assessing Officer has erred in making huge addition of Rs.6,37,69,276/- under section 68 of the Income Tax Act towards the Sundry Creditors and same is upheld by CIT (Appeals). 4. The learned Assessing Officer has erred in making huge addition under Section 68 to the tune of Rs.22,36,19,995/- towards unsecured loans reflected in the Balance sheet and same is upheld by CIT(Appeals).” 4. Brief facts of the case are that the assessee’s case was selected for a complete scrutiny and statutory notices were issued and served upon the assessee. During the assessment proceeding, the Learned Assessing Officer (‘Ld. AO’ for short) had sought for details from the assessee pertaining to various issues and upon considering the same the Ld. AO passed the assessment order dated 28.03.2024 u/s 143(3) r.w.s. 144B of the Act determining the total income at Rs.34,68,17,271/- after making an addition of Rs.5,94,28,000/- under the head ‘business and profession’, Rs.6,37,69,276/- towards sundry creditors and Rs.22,36,19,995/- towards unsecured loan availed by the assessee, on the ground that the assessee has failed to substantiate the same with cogent documentary evidences. Printed from counselvise.com ITA No.8828/Mum/2025 M/s. Nav Durga Construction Company 3 5. Aggrieved, the assessee was in appeal before the first appellate authority who vide an ex-parte order dated 03.09.2025 dismissed the appeal filed by the assessee on the ground that the assessee has been non-compliant. 6. Aggrieved, the assessee is in appeal before us, challenging the ex-parte order passed by the Ld. CIT(A) on the aforementioned grounds. 7. We have heard the Ld. DR and perused the materials available on record. It is observed that the Ld. AO had made various additions pertaining to the business income of the assessee, the sundry creditors and the unsecured loan availed by the assessee, due to the failure on the part of the assessee to provide details such as the quantitative bifurcation of raw material and finished goods as the assessee was in the business of construction and where it was observed that the details of stock furnished in the audit report did not corroborate with the fact as to how the assessee had arrived at the net profit and gross profit in the absence of stock register, details of closing sock of raw material, work in progress and finished goods. Further, the Ld. AO observed that the assessee has failed to furnish details of sundry creditors aggregating to Rs.6,37,69,276/- where the assessee has not furnished the PAN, address along with the other details of the creditors except for the names. Pertaining to the unsecured loan, the assessee has also failed to discharge the initial onus casted upon it in proving the identity, creditworthiness and genuineness of the transaction. The assessee was also non-compliant before the first appellate authority and neither before us the assessee has filed any documentary evidences to support its claim. In order to extend the assessee with one more opportunity, we deem it fit to remand the issue back to the file of the Ld. CIT(A) for denovo adjudication with the direction that the Printed from counselvise.com ITA No.8828/Mum/2025 M/s. Nav Durga Construction Company 4 assessee shall comply with the proceeding before the first appellate authority without any undue delay from its side and to produce all relevant documentary evidences to establish its claim, basis which the Ld. CIT(A) shall decide the issue on the merits and in accordance with law after duly considering the evidences relied upon by the assessee. 8. Accordingly, the grounds raised by the assessee are allowed for statistical purpose. 9. In the result, the appeal filed by the assessee is hereby allowed for statistical purpose. Order pronounced in the open court on 27.02.2026 Sd/- Sd/- (OM PRAKASH KANT) (KAVITHA RAJAGOPAL) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai; Dated: 27.02.2026 * Kishore, Sr. P.S. Copy of the Order forwarded to: 1. The Appellant 2. The Respondent 3. CIT- concerned 4. DR, ITAT, Mumbai 5. Guard File BY ORDER, (Dy./Asstt.Registrar) ITAT, Mumbai Printed from counselvise.com "