PRAKASH GUNAJI VEER,MUMBAI V. INCOME TAX OFFICER 41(3)(3), MUMBAI, MUMBAI

ITA 3517/MUM/2025

AI Insights

The case involves Mr. Prakash Gunaji Veer, the appellant, who appealed against the order of the Commissioner of Income Tax (Appeals) dated 23/03/2025, which confirmed an addition of Rs. 51,63,690 as unexplained investment under Section 69 of the Income Tax Act, 1961. The addition was initially made by the AO during a scrutiny assessment, where the assessee failed to provide necessary details regarding the source of funds for a property purchase worth Rs. 67,00,000. The assessee contended that he did not receive the statutory notices due to them being sent to his tax consultant's contact details, and also cited the COVID-19 pandemic as a reason for not being able to gather and submit evidence in time. The Tribunal, considering the circumstances and the additional evidence provided, decided to remand the matter back to the AO for a fresh assessment.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 717140 (ITAT-MUMBAI)
• Duration Of Justice: 3 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-08-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Assessment Year: 2018-2019
• Appeal Filed On: 20-05-2025
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: VIRABHADRA S. MAHAJAN; DR
• Assessee Lawyers: TEJAS SHETTY; AR
• Keywords: Opportunity of being heard; Additional evidence; Revised return; Unexplained investment; Source of fund
• Section: 69

Judgement Text

" | आयकर अपीलीय अिधकरण ा यपीठ, मुंबई | IN THE INCOME TAX APPELLATE TRIBUNAL “C” BENCH, MUMBAI BEFORE SHRI NARENDRA KUMAR BILLAIYA, HON’BLE ACCOUNTANT MEMBER & SHRI SANDEEP SINGH KARHAIL, HON’BLE JUDICIAL MEMBER I.T.A. No. 3517/Mum/2025 Assessment Year: 2018-19 Mr. Prakash Gunaji Veer Room No. 6 Jayshree Chawl Kokani Pada Kurar Village Malad East Mumbai Maharashtra - 400097 [PAN: AEIPV0160L] Vs Income Tax Officer – 41(3)(3), Mumbai अपीला थ\u0016/ (Appellant) \u0017\u0018 यथ\u0016/ (Respondent) Assessee by : Shri Tejas Shetty, A/R Revenue by : Mr. Virabhadra S. Mahajan, Sr. D/R सुनवाई की तारीख/Date of Hearing : 21/08/2025 घोषणा की तारीख /Date of Pronouncement : 21/08/2025 आदेश/O R D E R PER NARENDRA KUMAR BILLAIYA, AM: This appeal by the assessee is preferred against the order dated 23/03/2025 of the NFAC, Delhi [hereinafter the “ld. CIT(A)”] pertaining to AY 2018-19. 2. The grievance of the assessee reads as under:- “Being aggrieved by the order dated 23rd March, 2025, passed by the Ld. Commissioner of Income Tax (Appeals), Income Tax Department [\"Ld. CIT (A)\"] u/s 250 of The Income Tax Act, 1961(\"Act\"), your appellant prefers this appeal, among others, on the following grounds of appeal, each of which is without prejudice to, and independent of the other; 1. The Ld. CIT (A) erred in not granting final opportunity of being heard. The Ld. CIT (A) erred in not accepting the reply duly submitted to the only notice issued by the Ld. CIT (A), in which the appellant had asked for some time to reply to the only notice issued by the Ld. CIT (A). The Ld. CIT (A) erred in issuing standard notices, and passing the order ex-parte without giving the Printed from counselvise.com I.T.A. No. 3517/Mum/2025 2 appellant a chance to file a written submission. Further the Ld. CIT (A) erred in accepting the Learned Assessing Officer's stand when prima facie, it was fairly evident, that the Order passed by the Learned Assessing Officer was mechanical without considering the 'mens rea' of the appellant. 2. On the facts and in the circumstances of the case, and also in law, the Ld. CIT (A) erred in confirming the addition of Rs. 51,63,690 under Section 69 of the Income Tax Act, 1961, treating it as unexplained investment, despite the appellant furnishing documentary evidence explaining the full source of investment towards the purchase of residential property amounting to Rs. 67,00,000 during the assessment proceedings to the Learned Assessing Officer. 3. On the facts and in the circumstances of the case, and also in law, the Ld. CIT (A) erred failed to consider the copies of the sale deed of the old flat, loan sanction letter from SBI, loan account statement, and evidence of personal savings, all of which collectively establish the source of Rs. 67,00,000 invested in the new residential property. 4. The addition made and upheld by the Ld. CIT (A) is based on assumptions that Rs. 51,63,690/- was unexplained, despite the appellant having filed a revised return and submitted data and documents during the assessment proceedings to corroborate the source of funds for the purchase of the flat for Rs.67,00,000. 5. Your appellant craves leave to alter, modify, amend or delete any of the above grounds of appeal, or to add one or more new ground(s), as may be necessary.” 3. Heard the parties. Case records carefully perused. 4. Briefly stated the facts of the case are that return of income for the year was filed on 14/11/2018, the return was selected for scrutiny assessment and accordingly statutory notices were issued and served upon the assessee. As per the inside data, the AO came to know that the assessee has purchased a property for a consideration of Rs. 67,00,000/-. In spite of notice, the assessee did not furnish the necessary details and the AO was left with no choice but to frame the assessment ex-parte and made the addition of Rs.67,00,000/-. Printed from counselvise.com I.T.A. No. 3517/Mum/2025 3 5. Though the assessee preferred the appeal before the ld. CIT(A) but could not furnish the necessary details and the ld. CIT(A) partly confirmed the addition to the extent of Rs. 51,63,690/-. 6. Before us, the ld. Counsel for the assessee filed an affidavit of the assessee in which the assessee states that he did not receive the statutory notices issued by the Department as the mobile number and e-mail id registered in his income-tax records belonged to his tax consultant who did not inform about the notice or the proceedings initiated in his case. The assessee further contends that due to Covid-19 Pandemic, the assessee could not collect the evidence and furnish the same and all those evidence are furnished now. 7. Considering the contents of the applications and the additional evidence furnished before us, we are of the considered view that such evidence has to be examined by principal officer i.e., the AO. Therefore, in the interest of justice, we deem it fit to restore the issue to the file of the AO. The assessee is directed to attend the assessment proceedings and furnish all the necessary evidence explaining the source of investment in the said property and the AO is directed to examine the same and decide the issue afresh after affording a reasonable and adequate opportunity of being heard to the assessee. 8. In the result, appeal of the assessee is allowed for statistical purposes. Order pronounced in the Court on 21st August, 2025 at Mumbai. Sd/- Sd/- (SANDEEP SINGH KARHAIL) (NARENDRA KUMAR BILLAIYA) JUDICIAL MEMBER ACCOUNTANT MEMBER Mumbai, Dated 21/08/2025 *SC SrPs *SC SrPs *SC SrPs *SC SrPs Printed from counselvise.com I.T.A. No. 3517/Mum/2025 4 आदेश की \u0015ितिलिप अ\u001aेिषत/Copy of the Order forwarded to : 1. अपीलाथ / The Appellant 2. \u0015 थ / The Respondent 3. संबंिधत आयकर आयु\" / Concerned Pr. CIT 4. आयकर आयु\" ) अपील ( / The CIT(A)- 5. िवभागीय \u0015ितिनिध ,आयकर अपीलीय अिधकरण, मुंबई /DR,ITAT, Mumbai, 6. गाड& फाई/ Guard file. आदेशानुसार/ BY ORDER TRUE COPY Assistant Registrar आयकर अपीलीय अिधकरण ITAT, Mumbai Printed from counselvise.com "