RAJESHWAR GOVIND DESHPANDE ,MUMBAI V. ITO WARD 3(2), MUMBAI

ITA 4026/MUM/2025

AI Insights

The case involves Rajeshwar Govind Deshpande, a non-resident Indian, who appealed against the order of the CIT(A) which upheld the addition of Rs. 1,46,12,903 as unexplained investment in immovable property under section 69 of the Income Tax Act. The assessee argued that all investments were made from known sources, evidenced by bank statements and other documents, which were allegedly ignored by the CIT(A). The Tribunal found that the CIT(A) had not adequately considered the submissions and documents provided by the assessee, leading to the decision to remand the case back to the Assessing Officer for a detailed examination of the sources of investment.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 775221 (ITAT-MUMBAI)
• Duration Of Justice: 3 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-09-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: D
• Assessment Year: 2018-2019
• Appeal Filed On: 05-06-2025
• Laws Referred To: Income Tax Act
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: ANNAVARAM KASURI
• Assessee Lawyers: ABHISHEK J. BHOOR
• Keywords: Set aside; Unexplained investment; Salary income
• Section: 148; 144; 69

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL “D” BENCH, MUMBAI BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER & SHRI PRABHASH SHANKAR, ACCOUNTANT MEMBER ITA No. 4026/MUM/2025 (AY: 2018-19) (Physical hearing) Rajeshwar Govind Deshpande 1-504, Vijay Park, Ghodbundar Road, Kesarvadavli Thane, Maharashtra – 400615. [PAN No. AADPD6123G] Vs ITO, Ward-3(2), Thane Ashar IT Park, 6th Floor, Near MIDC Road, 16Z, Wagle Industrial, Thane, Maharashtra-400604. Appellant / Assessee Respondent / Revenue Assessee by Shri Abhishek J. Bhoor, Advocate Revenue by Shri Annavaram Kasuri, Sr. DR Date of Institution 05.06.2025 Date of hearing 22.08.2025 Date of pronouncement 05.09.2025 Order under section 254(1) of Income Tax Act PER PAWAN SINGH, JUDICIAL MEMBER; 1. This appeal by assessee is directed against the order of ld. CIT(A) / NFAC dated 14.02.2025 for A.Y. 2018-19. The assessee has raised following grounds of appeal: “1. The order passed by Income Tax Officer, Ward 3(2), Thane, Maharashtra and upheld by Hon'ble CIT(Appeals) NFAC Delhi, is illegal, invalid and bad in law. 2. The addition of Rs. 1,46,12,903/-being purchase of immovable property treated as unexplained investment u/s 69 made by Income Tax Officer, Ward 3(2), Thane and upheld by Hon'ble CIT (Appeals), NFAC, Delhi is unjustified, unwarranted and bad in law. 3. The Assessee preferred appeal before honorable Commissioner of Appeals by filing appeal vide efiling acknowledgement no. 401873680111023 dated 11-10-2023 and submitted all facts as well as Printed from counselvise.com ITA No. 4026/Mum/2025 Rajeshwar Govind Deshpande 2 copy of purchase deed, all bank statements explaining the sources of investments. But to our utter surprise, the honorable commissioner appeals has not considered our submission nor given us any opportunity to explain our case and passed the order against us confirming additions made by ITO ward 3(2) Thane. The honorable commissioner has not written even a single word on our submissions and rejected our prayer. Hence, aggrieved by the order of commissioner appeals, we prefer this appeal before this honorable court. 4. The honorable Commissioner of Appeals has not considered any of the required documents showing investments made in the immovable property along with its sources and other relevant documents as mentioned in the present appeal memo. The Appellant has filed entire sources of investment of the said property which are totally ignored by the honourable commissioner of appeals. 5. In view of the facts and grounds as raised hereinabove, it is clear that the impugned Appeal Order dated 07/05/2025 passed by NFAC is arbitrary, illegal, bad and the same deserves to be set aside, in the interest of justice. 6. The appellant reserves his right to raise any other grounds as may arise in the facts and circumstances of the case with prior leave of the Hon'ble Authority. 7. Any other ground shall be prayed at the time of hearing. 8. The Commissioner (Appeals) has not considered/decided a single ground raised by the appellant before him. 9. The commissioner (Appeals) erred in observing that the appellant has not explained the source of investment in purchase of immovable property during the course of assessment proceedings. The appellant has duly explained in memo of appeal that the appellant has not received Printed from counselvise.com ITA No. 4026/Mum/2025 Rajeshwar Govind Deshpande 3 any notice/information of any notice during the course of assessment proceedings and the assessment order is ex parte. The appellant has duly filed all the required documents before Commissioner (Appeals) and duly explained all the reasons along with supporting documents explaining source of investment. The commissioner (Appeals) has failed to consider the submission/documents filed by the appellant.” 2. Brief facts of the case are that case of assessee for assessment year (AY) 2017-18 was reopened on the basis of information available with the department that assessee purchased immovable property during the relevant financial and no return of income was filed by assessee. The assessing officer issued notice under section 148 on 31.03.2022. The assessing officer noted that in response to notice under section 148, no return of income was filed by assessee. As per the information with the assessing officer, the assessee purchased immovable property for a consideration of Rs. 1.46 crores, source of investment was not explained, thus, the assessing officer added entire investment under section 69 of Income Tax Act. In the assessment order, passed under section 144 r.w.s.147. On coming to know about passing of assessment order, the assessee filed appeal before ld. CIT(A). On appeal before ld. CIT(A), the action of assessing officer was upheld. Further, aggrieved the assessee has filed present appeal before Tribunal. 3. We have heard the submissions of learned Authorised Representative (ld. AR) of the assessee and the learned Senior Departmental Representative (ld. Sr. DR) for the revenue. The ld. AR of the assessee submits that assessee is a non-resident Indian and residing in United State of America Printed from counselvise.com ITA No. 4026/Mum/2025 Rajeshwar Govind Deshpande 4 (USA) from last 25 years. The assessee is having certificate of overseas Citizen of India. The assessee was not having any taxable income in India for the relevant financial year. Therefore, no return of income was filed. Notice under section 148 was not served upon the assessee; hence there was no occasion to make response to notice under section 148. The father of assessee, late Govind Deshpnde was retired as Metropolitan Magistrate of Bombay City. His father was filing regular return income upto for A.Y. 2018-19. The mother of assessee was not having taxable income, so no return of income was filed by her mother. In the year 2018, the Government acquired land owned by assessee. The assessee on received compensation in February, 2023 started filing return of income from A.Y. 2023-24 regularly. At the time of filing return of income for A.Y. 2023-24 on 26.07.2023, the assessee realised that there was demand against the assessee and that penalty proceedings in respect of A.Y. 2018-19 were also initiated. On coming to know, such order, the assessee collected relevant order and immediately filed appeal before ld. CIT(A) on 11.10.2023. Along with the appeal, the assessee furnished complete details of source of investment for purchase of property during financial year 2017-18. The assessee furnished three bank statements from three bank accounts. One bank account in State Bank of India was in the name of assessee and his father, second bank account in the name of assessee and his mother and third bank account in the name of assessee and his mother. All the purchase consideration was paid by way of cheques. All details were provided along with bank accounts and summary of payment of Printed from counselvise.com ITA No. 4026/Mum/2025 Rajeshwar Govind Deshpande 5 consideration/ investment. Along with the appeal, the assessee furnished bank statement details of payment. Copy of return of income of assessee’s father for A.Y. 2017-18 wherein he has shown income from salary-pension of Rs. 27,31,387/- and in A.Y. 2018-19 of Rs. 7,30,652/-. The ld. AR of the assessee by referring of such details and the acknowledgement of ITBA portal would submits that despite providing complete details ld. CIT(A) passed a very short and cryptic order in confirming the addition made by assessing officer. The ld. CIT(A) has even not mentioned about issuance of notice under section 250. The ld. AR submits that there is no unexplained investment, all the investments were made from known sources, all the details were furnished in a tabulated form, copy of which placed at page no. 11 of the paper book. The ld. AR of the assessee submits that there is no unexplained investment; therefore, another addition may be deleted and appeal may be allowed. 4. On the other hand, learned Senior Departmental Representative (ld. Sr. DR) for the revenue supported the order of lower authorities. The ld. Sr. DR submits that assessment was completed under section 144. In the order of ld. CIT(A) there is no reference about consideration of any such evidence decision as filed along with Form 35. On confronting the detail statement of fact and acknowledgement of various documents including bank statement, the ld. Sr. DR for the revenue submits that matter may be restored back to the file of ld. CIT(A) or assessing officer for passing the order on merit after considering the source of investment furnished by the assessee. Printed from counselvise.com ITA No. 4026/Mum/2025 Rajeshwar Govind Deshpande 6 5. We have considered the rival submissions of both the parties and have gone through the orders of lower authorities carefully. We find that assessment was completed under section 144. The assessing officer while passing the assessment order made addition of Rs. 1.46 crores as unexplained investment on purchase of immovable property. We find that before ld. CIT(A), while filing appeal in the statement of fact, the assessee narrated detailed fact that notice under section 148 was not served as the assessee was not residing in India. The assessee also furnished three bank statements showing the source of investment. The details of investments are also provided in a tabulated form as per details available on page No.11 of paper book (PB). We find that all such details are again explained before us, which furnished along with Form 35. We find that ld. CIT(A) has not even considered the bare fact mentioned in the Form 35. On perusal of various bank statement and the summary of investment as mentioned on page no. 11 of paper book, we find that assessee has explained all the sources. However, such fact is not discernible from the order of ld. CIT(A). Therefore, prima facie, we find merit in the submission of ld. AR of the assessee that entire investment is made through banking channels and from three bank statement, wherein the assessee is joint account holder. Entire investment is added in the hand of assessee. Thus, considering the facts that the assessee has primarily shown source of investment, but the lower authorities have not given their finding on merit, hence, the matter is restored back to the file of jurisdictional Assessing officer for limited purpose to verify the source of investment which shown from three bank Printed from counselvise.com ITA No. 4026/Mum/2025 Rajeshwar Govind Deshpande 7 accounts wherein assessee is one of the joint account holder and to allow relief to the assessee in accordance with law. In the result, grounds of assessee are allowed for statistical purpose. 6. In the result, the appeal of assessee is allowed for statistical purposes. Order pronounced in the open Court on 05/09/2025. Sd/- PRABHASH SHANKAR ACCOUNTANT MEMBER Sd/- PAWAN SINGH JUDICIAL MEMBER MUMBAI, Dated: 05/09/2025 Biswajit Copy of the order forwarded to: (1) The Assessee; (2) The Revenue; (3) The PCIT / CIT (Judicial); (4) The DR, ITAT, Mumbai; and (5) Guard file. By Order Assistant Registrar ITAT, Mumbai Printed from counselvise.com "