SHEBANI DHIREN GALA,MUMBAI, MAHARASHTRA V. NATIONAL FACELESS APPEAL CENTRE, NEW DELHI

ITA 3337/MUM/2025

AI Insights

This case involves an appeal by Shebani Dhiren Gala against the order of the National Faceless Appeal Centre (NFAC) / Ld. CIT(A), Mumbai, dated 12.03.2025, for the assessment year 2017-18. The primary contention revolves around the alleged discrepancies in the 'reasons to believe' recorded by the Assessing Officer for reopening the assessment under Section 147 of the Income Tax Act, 1961, and the grounds on which the Assessing Officer made the additions. The appellant argued that the CIT(A) erred by not considering the written submissions and detailed explanations provided in response to the notice under Section 250, thereby violating the principles of natural justice. Additionally, the appellant contested the clubbing of income of minor children with her income, which was claimed to be against the provisions of section 64(1A) of the Income Tax Act. The CIT(A)'s decision was challenged for not being a 'speaking order' and for not considering the additional evidence submitted under Rule 46A of the Income-tax Rules, 1962. The Tribunal found merit in the appellant's contention regarding the non-consideration of submissions and restored the matter back to the CIT(A) for a fresh decision.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 705423 (ITAT-MUMBAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-07-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Assessment Year: 2017-2018
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: MAHESH DATTATRAYA LONDHE
• Assessee Lawyers: TEJASSODHA
• Keywords: Set aside; Additional evidence; Reassessment proceedings; Principle of natural justice
• Section: 147

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, MUMBAI BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER ITA No. 3337/MUM/2025 (AY: 2017-18) (Physical hearing) ShebaniDhiren Gala 15/2, VithalKunj, VP Road, Andheri West, Mumbai-400058. [PAN No. ALXPG6008J] Vs ITO, Ward-31(2)(1), Mumbai Appellant / Assessee Respondent / Revenue Assessee by Sh. Tejas Sodha, CA Revenue by Sh. Mahesh Dattatraya Londhe, Sr. DR Date of hearing 03.07.2025 Date of pronouncement 03.07.2025 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 National Faceless Appeal Centre (NFAC) / Ld. CIT(A), Mumbai dated 12.03.2025 for assessment year (AY) 2017-18. The assessee has raised following grounds of appeal: “1. That the learned CIT(A) has erred in law and fact by not considering that the \"reasons to believe\" recorded by the Assessing Officer while reopening the assessment under Section 147 of the Act were different from the grounds on which the Assessing officer made the additions. Thus, if the reassessment is made on grounds not mentioned in the original reasons to believe, the entire reassessment is bad in law and hence void-ab-initio. 2. That the learned Commissioner of Income Tax (Appeals) [CIT(A)] erred in law and facts by passing the impugned order u/s 250 of the Income Tax Act, 1961 on 12.03.2025, without considering, the written submissions and detailed explanation filed by the appellant on 11.03.2025 in response to the notice issued under Section 250 of the Income-tax Act, 1961, thereby violating the principles of natural justice. 3. That the learned CIT(A) erred in fact and law by not considering that the appellant has filed the additional evidence filed by the appellant under Rule 46A of the Income-tax Rules, 1962, along with a submissions made during the appellate proceedings before CIT(A) to substantiate the claim of the appellant. Further Acknowledgement copy of the aforesaid additional ITA No. 3337/Mum/2025 Shebani Dhiren Gala 2 evidence and Submissions made has been received by the appellant online on 11.03.2025. 4. The learned CIT(A) erred in fact and law by not considering the appellant's explanations, documentation, and evidence placed on record, thereby passing an order that is bad in law. The learned CIT(A) failed to appreciate that the additions made u/s 69A of the Income Tax Act, 1961 in respect of clubbing of income of minor children NehanDhiren Gala and Kierra Dhiren Gala amounting to Rs.2,53,500/- & Rs.3,17,000/- respectively with mother's income i.e appellant Shebani Gala without considering the provisions of section 64(1A) of the Income Tax wherein the income of minor children is clubbed with the income of that parent whose income (excluding minor's income) is higher, which in case of the appellant was the appellant's spouse. 5. The learned CIT(A) erred in law and fact by not appreciating the fact that it is a settled principle of law that no addition can be sustained in reassessment proceedings unless it is based on the specific reasons recorded for reopening. Additions beyond the scope of such reasons are void ab initio and liable to be quashed. 6. The appellant states that the learned Commissioner of Income Tax (A) erred in law and fact by not passing a speaking order on the aforesaid matter or rebut the appellant’s grounds of appeal by any evidence contradicting the appellant’s submissions. 7. In view of the above the appellant order be set aside, the addition under section 69A of Rs. 9,28,100/- be deleted. 8. The appellant craves leave to add, amend, alter and / or withdraw the aforesaid grounds of appeal.” 2. Rival submissions of both the parties have been heard and record perused. The learned Authorised Representative (ld. AR) of the assessee submits that he was not given fair and reasonable opportunity by assessing officer. The assessing officer passed the ex-parte order without giving opportunity to the assessee. The ld. CIT(A) fixed hearing of appeal only on two occasions and show cause notices. On second date of hearing the assessee filed submission on 11.03.2025. The ld. CIT(A) passed the order on 12.03.2025 without considering such submission. The ld. AR of the assessee submits that since ITA No. 3337/Mum/2025 Shebani Dhiren Gala 3 ld. CIT(A) decided the appeal without considering the submission filed by assessee, therefore, matter may be restored back to the file of ld. CIT(A). He undertakes on behalf of the assessee to be more vigilant in making timely compliance. 3. On the other hand, learned Senior Departmental Representative (ld. Sr. DR) for the revenue supported the order of ld. CIT(A). 4. I have considered the rival submissions of both the parties and have gone through the orders of lower authorities carefully. I find that the ld. CIT(A) vide his notice dated 03.03.2025 asked the assessee to make compliance / written submission by 10.03.2025. The assessee filed reply on 11.03.2003. Though the order is passed on 12.03.2025 but such submission of assessee was not considered. Therefore, I deem it appropriate to restore the matter back to ld. CIT(A) to consider the submission of assessee and passed the order afresh. The assessee is also directed to file his submission afresh as and when directed by ld. CIT(A). 5. In the result, the appeal of the assessee is allowed for statistical purpose. Order was pronounced in the open Court on 03/07/2025. Sd/- PAWAN SINGH JUDICIAL MEMBER MUMBAI, Dated:03/07/2025 Biswajit ITA No. 3337/Mum/2025 Shebani Dhiren Gala 4 Copy of the order forwarded to: (1) The Assessee; (2) The Revenue; The PCIT / CIT (Judicial); (3) The DR, ITAT, Mumbai; and (4) Guard file. By Order Assistant Registrar ITAT, Mumbai "