SHREE JEWEL HOUSE PVT LTD,MUMBAI V. INCOME TAX OFFICER WARD 4(30(3), MUMBAI

ITA 1007/MUM/2025

AI Insights

The case involves Shree Jewel House Pvt. Ltd., which appealed against the order of the Learned Commissioner of Income-tax (Appeals) confirming an addition of Rs. 3,94,11,110 under section 69A of the Income Tax Act, 1961, for the Assessment Year 2017-18. The addition was based on the grounds that the cash sales declared by the appellant were not satisfactorily explained. The appellant argued that the provisions of section 69A were inapplicable as the proceeds from cash sales were already recorded in their books. The initial appeal was dismissed ex-parte by the CIT(A) due to non-compliance with notices, which the assessee attributed to financial distress and inability to access their office. The Tribunal found merit in the assessee's explanation for the delay and remanded the case back to the CIT(A) for a thorough re-examination.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 26651 (ITAT-MUMBAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-03-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2017-2018
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANISH SAREEN
• Assessee Lawyers: KIRAN MEHTA
• Keywords: Condonation of delay; Reasonable cause; Principle of natural justice
• Section: 144; 250; 69A; 2

Judgement Text

" IN THE INCOME-TAX APPELLATE TRIBUNAL “B” BENCH, MUMBAI BEFORE SHRI SANDEEP GOSAIN, JUDICIAL MEMBER & SMT. RENU JAUHRI, ACCOUNTANT MEMBER आयकर अपील सं./ITA No. 1007/MUM/2025 (निर्धारण वर्ा / Assessment Year :2017-18) Shree Jewel House Pvt. Ltd. 303, Kakad Market, 3rd Floor, 306 Kalbadevi Road, Kalbadevi, Mumbai-400002 v/s. बिधम ITO Ward 4(3)(3), Mumbai Room No. 637, 6th Floor, Aayakar Bhavan, Maharishi Karve Road, Mumbai-400020 स्थायी लेखा सं./जीआइआर सं./PAN/GIR No: AAPCS0590M Appellant/अपीलधर्थी .. Respondent/प्रनिवधदी निर्ााररती की ओर से /Assessee by: Shri Kiran Mehta रधजस्व की ओर से /Revenue by: Shri Manish Sareen सुिवधई की िधरीख / Date of Hearing 27.03.2025 घोर्णध की िधरीख/Date of Pronouncement 27.03.2025 आदेश / O R D E R PER RENU JAUHRI [A.M.] :- This appeal is filed by the assessee against the order of the Learned Commissioner of Income-tax (Appeals), Mumbai/National Faceless Appeal Centre, Delhi [hereinafter referred to as “CIT(A)”] dated 29.01.2024 passed u/s. P a g e | 2 ITA No. 1007/Mum/2025 A.Y. 2017-18 Shree Jewel House Pvt. Ltd. 250 of the Income-tax Act, 1961 [hereinafter referred to as “Act”] for Assessment Year [A.Y.] 2017-18. 2. The assessee has raised the following grounds of appeal: 1. “In the facts and circumstances of the case and in law the learned CIT(A) erred in confirming an addition of Rs. 3,94,11,110/- made u/s 69A of the Income Tax Act, 1961 on the footing that the cash sales declared by the appellant were not satisfactorily explained. 2. In the facts of the appellant’s case, the learned CIT(A) erred in confirming the impugned addition made u/s 69A without appreciating that a. Provisions of section 69A had no application as the appellant had recorded the proceeds of cash sales of jewellery/gold bullion in its books of accounts. b. Since the appellant had already declared the impugned proceeds as sales the addition made u/s 69A would amount to double addition more so as the learned AO has accepted the impugned cash sales as genuine. c. The appellant had ample stock in hand to make the sales reference. 3. The learned CIT(A) erred in not dealing with the ground of the appellant that in the facts of the case, provisions of section 115BBE had no application. 4. Without prejudice to the above grounds of appeal, it is submitted that the addition of gross cash sales account is not at all justified and that at the highest only a token GP addition could be made.” 3. At the outset, it is noticed that the appeal is delayed by 321 days. In order to explain the delay, an affidavit has been filed by the assessee along with supporting documentary evidence explaining the reasons for the delay. It is stated that the assessee had become a Non-Performing Account (NPA) with the Kotak Mahindra Bank in FY 2021-22 after which the bank had initiated proceedings to take possession of the shop/office of the assessee. Only after the payment was made to the bank on 31.12.2024, the possession of the office was received back by the assessee. Accordingly, the appeal against the order of Ld. P a g e | 3 ITA No. 1007/Mum/2025 A.Y. 2017-18 Shree Jewel House Pvt. Ltd. CIT(A) which was due to be filed before 30.03.2024 was delayed and could be filed only on 13.02.2025. In view of the circumstances explained by the assessee, we are of the view that there was reasonable cause for the delay on 321 days in the filing of the present appeal and therefore the delay is hereby condoned. 4. Brief facts of the case are that the assessee had filed return declaring total income of Rs. 24,74,830/- on 28.10.2017 and the assessment was completed vide order u/s 144 dated 20.12.2019 at an income of Rs. 4,18,85,940/-. 5. Aggrieved with the order of Ld. AO, the assessee preferred an appeal before the Ld. CIT(A). Since no compliance to various notices issued by the Ld. CIT(A) was made, the appeal was dismissed exparte vide order dated 29.01.2024. 6. Aggrieved with the order of Ld. CIT(A), the assessee is in appeal before the Tribunal. Before us, it has been submitted by the Ld. AR that for the reasons explained in the affidavit for condonation of delay in filing the second appeal, no compliance could be made before Ld. CIT(A) and has, therefore, requested for remanding back the matter to Ld. CIT(A). Ld. DR has also not controverted the proposition made by the Ld. AR. 7. In the interest of natural justice, we deem it appropriate to restore the matter to Ld. CIT(A) for a fresh adjudication on merits after giving due P a g e | 4 ITA No. 1007/Mum/2025 A.Y. 2017-18 Shree Jewel House Pvt. Ltd. opportunity to the assessee. The assessee is also directed to make requisite compliance before the Ld. CIT(A) 8. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open court on 27.03.2025. Sd/- Sd/- SANDEEP GOSAIN RENU JAUHRI (न्यधनयक सदस्य/JUDICIAL MEMBER) (लेखधकधर सदस्य/ACCOUNTANT MEMBER) Place: म ुंबई/Mumbai दिन ुंक /Date 27.03.2025 अननक ेत स ुंह र जपूत/ स्टेनो आदेश की प्रनतनलनि अग्रेनित/Copy of the Order forwarded to : 1. अपीलार्थी / The Appellant 2. प्रत्यर्थी / The Respondent. 3. आयकर आयुक्त / CIT 4. विभागीय प्रविविवि, आयकर अपीलीय अविकरण DR, ITAT, Mumbai 5. गार्ड फाईल / Guard file. सत्यानित प्रनत //True Copy// आदेशािुसार/ BY ORDER, सहायक िंजीकार (Asstt. Registrar) आयकर अिीलीय अनर्करण/ ITAT, Bench, Mumbai. "