SANDEEP CHAMPAKLAL SHAH,MUMBAI V. ITO WARD 31(1)(1), MUMBAI

ITA 1816/MUM/2025

AI Insights

This case involves an appeal by Sandeep Champaklal Shah against the order of the Commissioner of Income Tax (Appeals), which upheld the AO's assessment order for the Assessment Year 2014-15. The AO had reopened the assessee's case based on substantial financial transactions reported, which the assessee failed to explain or disclose adequately. The Tribunal noted the assessee's non-compliance during the proceedings but decided to remand the case for a fresh assessment, considering the assessee's health issues and previous non-compliance.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 397094 (ITAT-MUMBAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-05-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2014-2015
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SATYAPAL KUMAR
• Assessee Lawyers: DHARMESH SHAH; JIGNA JAIN
• Keywords: Reassessment proceedings; Period of limitation; Capital Gains; Principle of natural justice; TDS
• Section: 147; 148; 144; 142(1); 69

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, MUMBAI BEFORE SHRI. OM PRAKASH KANT, AM AND MS. KAVITHA RAJAGOPAL, JM ITA No. 1816/Mum/2025 (Assessment Year: 2014-15) Sandeep Champaklal Shah Flat No. 9C, Ashok Smruti Bldg., Nicolas Wadi Road, Mumbai, Andheri East, S.O., Mumbai – 400069. Vs. ITO Ward 31(1)(1) C-13/305A, Kautilya Bhavan, BKC, Mumbai – 400051. PAN/GIR No. AMTPS9859G (Appellant) : (Respondent) Assessee by : Shri. Dharmesh Shah & Jigna Jain Respondent by : Shri. Satya Pal Kumar – CIT (DR) Date of Hearing : 01.05.2025 Date of Pronouncement : 27.05.2025 O R D E R Per Kavitha Rajagopal, J M: This appeal has been filed by the assessee, challenging the order of the learned Commissioner of Income Tax (Appeals) Delhi (‘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) 2014-15. 2. It is observed that the assessee has filed this present appeal with a delay of 64 days beyond the period of limitation for which the assessee has filed an application for condoning the delay along with the reasons specified for the delay. After hearing the rival contentions, we deem it fit to condone the delay in filing the appeal for the reason that there was ‘sufficient cause’ and bonafide reasons for the delay. Delay condoned. ITA No. 1816/Mum/2025 (A.Y. 2014-15) Sandeep Champaklal Shah 2 3. The assessee has raised the following grounds of appeal: “1. The Ld. CIT(A) has erred in law and in fact by not appreciating that the Ld. A.O. has passed an order u/s 147 r.w.s. 144 r.w.s. 144B of the Act without which is bad in law and illegal. 2. The Ld. CIT(A) has erred in law and in facts in not appreciating that the notice issued u/s 148 of the Act and the reassessment proceedings conducted u/s 147 of the Act were bad in law and void ab initio. 3. The Ld. CIT(A) has erred in law and in facts in passing order u/s 250 of the Act and confirming the addition made by Ld. A.O. without granting effective opportunity of hearing to the assessee. 4. The Ld. CIT(A) has erred in law and in facts in confirming the addition on account of Short-Term Capital Gains of Rs. 33,03,000/-. 5. The Ld. CIT(A) has erred in law and in facts in confirming the addition of Rs. 12,13,81,257/-on account of alleged unexplained income invested in commodities exchange u/s 69 of the Act. 6. The Ld. CIT(A) has erred in law and in facts in confirming the addition made by the Ld. A.O. of Rs. 18,02,86,257/-on account of alleged sale of future (derivatives) u/s 69 of the Act.” 4. Brief facts of the case are that the assessee is an individual and has not filed his return of income for the year under consideration. The assessee’s case was reopened based on the information available, vide notice u/s. 148, dated 27.07.2022 pursuant to order u/s. 148A(d), dated 27.07.2022, where the assessee is said to have entered into the financial transactions relevant to A.Y. 2014-15, aggregating to Rs. 31,48,79,558/-, which details are as below: Sr. No. Information Type Amount (Rs.) 1. TDS Return – Rent (Section 194I) 66,06,000/- 2. Sold Immovable property 66,06,000/- ITA No. 1816/Mum/2025 (A.Y. 2014-15) Sandeep Champaklal Shah 3 3. Contract of Rs.10,00,000/- or more in the commodity exchange. 12,13,81,257/- 4. Sale of option in securities (derivative) in a recognized stock exchange 50/- 5. Sale of futures (derivatives) in a recognized stock exchange 18,02,86,251/- 5. The learned Assessing Officer (ld. A.O. for short) also issued notice u/s. 142(1) of the Act on various dates which was not complied with by the assessee. The ld. AO then passed the assessment order u/s. 147 r.w.s. 144 r.w.s. 144B of the Act, dated 19.05.2023, being the best judgement assessment, where the ld. AO determined the total income at Rs. 30,49,70,508/-, after making various additions towards financial transactions which remained unexplained and undisclosed due to non-compliance by the assessee. 6. Aggrieved the assessee was in appeal before the first appellate authority, who vide an ex parte order dated 07.11.2024, upheld the order of the ld. AO on the ground that the assessee has been non-compliant and has failed to substantiate his claim. 7. The assessee is in appeal before us, challenging the impugned order of the ld. CIT(A). 8. We have heard the rival submissions and perused the materials available on record. It is observed that the assessee has challenged the addition made by the ld. A.O. before the first appellate authority but has been non-compliant throughout the appellate proceeding. 9. The learned Authorised Representative ('ld. AR' for short) for the assessee contended that the assessee has been carrying out trading in securities and since he suffered heavy ITA No. 1816/Mum/2025 (A.Y. 2014-15) Sandeep Champaklal Shah 4 losses due to which the assessee was under mental stress and trauma. The ld. AR further contended that the assessee is a chronic diabetic patient since several years and hence, he was unable to make compliance before the lower authorities. The ld. AR stated that the assessee has got a good case on merit and prayed that the assessee be given one more opportunity to present his case before the ld. AO. 10. The learned Departmental Representative ('ld. DR' for short) vehemently opposed to setting aside the issue to the file of the ld. AO, for the reason that the assessee was given several opportunities by the lower authorities which was not availed by the assessee. The ld. DR relied on the order of the lower authorities. 11. Upon considering the same, we deem it fit to extend the assessee with one more opportunity to present his case before the ld. AO along with all documentary evidences in support of his contentions, by adhering to the principles of natural justice and in the interest of justice dispensation. The assessee is directed to comply with the proceedings before the ld. AO and the ld. AO is directed to decide the issue on the merits of the case based on the submission of the assessee and in accordance with law. We have not expressed any view on the merits and therefore we remand all these issues back to the file of ld. AO for de novo assessment. 12. In the result, the appeal filed by the assessee is allowed for statistical purpose Order Pronounced under Rule 34(4) of the ITAT Rules by placing result on the notice board on. 27.05.2025 Sd/- Sd/- (OM PRAKASH KANT) (KAVITHA RAJAGOPAL) ACCOUNTANT MEMBER JUDICIAL MEMBER ITA No. 1816/Mum/2025 (A.Y. 2014-15) Sandeep Champaklal Shah 5 Mumbai; Dated: 27.05.2025 Karishma J. Pawar (Stenographer) 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 "