TALOJA STEEL SERVICE CENTRE LIMITED (FORMERLY KNOWN AS PARAMSHAKTI STEEL LTD),MUMBAI V. DY CIT CC 8(2), MUMBAI

ITA 7024/MUM/2025

AI Insights

The case involves Taloja Steel Service Centre Ltd., formerly known as Paramshakti Steel Ltd., appealing against the order of the Commissioner of Income-tax, which confirmed various disallowances and upheld the reopening of the assessment under section 147 of the Income Tax Act. The appellant argued that the CIT(A) had passed the order without providing an adequate opportunity of hearing, particularly noting that the order was issued before the scheduled date of hearing. The tribunal found that the principles of natural justice were violated as the assessee was not given a reasonable opportunity to be heard, leading to the decision to set aside the CIT(A)'s order and remand the case for a fresh hearing.

• Duration Of Justice: 4 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-03-2026
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: Mumbai
• Assessment Year: 2012-2013
• Appeal Filed On: 31-10-2025
• Laws Referred To: Income Tax Act
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: HEMANSHU JOSHI
• Assessee Lawyers: PRAKASH JOTWANI
• Keywords: Set aside; Difference of opinion; Change of opinion; Opportunity of being heard; Depreciation; Additional depreciation; Principle of natural justice

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “E” MUMBAI BEFORE SHRI OM PRAKASH KANT (ACCOUNTANT MEMBER) AND SHRI SANDEEP SINGH KARHAIL (JUDICIAL MEMBER) ITA No. 7024/MUM/2025 Assessment Year: 2012-13 Taloja Steel Service Centre Ltd. (Formerly known as Paramshakti Steels Limited) 310, Loha Bhavan, P D Mello Road, Carnac Bunder, Mumbai- 400009 Vs. Dy. Central Commissioner of Income Tax, Central Circle- 8(2), Mumbai 658, Aaykar Bhavan, M.K.Road, Mumbai- 400020 PAN NO. AAFCS 7494 A Appellant Respondent Assessee by : Mr. Prakash Jotwani Revenue by : Mr. Hemanshu Joshi, SR. DR Date of Hearing : 09/03/2026 Date of pronouncement : 26/03/2026 ORDER PER OM PRAKASH KANT, AM This appeal by the assessee is directed against order dated 04.09.2025 passed by the Ld. Commissioner of Income-tax- 48, Mumbai [in short ‘the Ld.CIT(A)] for assessment year 2012-13, raising following grounds. “1. a) The Ld. CIT (A) erred in passing an order u/s 250 of the Act on 04.09.2025 though, the date of hearing was scheduled to be on 08.09.2025. Printed from counselvise.com b) The Ld. CIT (A) failed to provide an adequate opportunity to the Appellant. 2. a) The Ld. CIT (A) erred in confirming the ex the Ld. AO when during the assessment proceedings, the company was under the NCLT and the Appellant was unable to attend the hearings before the AO. 3. a) The Ld. CIT (A) 147 when all the necessary documentary evidences with regards to reopening were available with the Ld. AO in original assessment proceedings. b) The Ld. CIT (A) failed to consider the fact \"a mere chan not a sufficient and cogent ground to reopen the assessment proceedings u/s 147 of the Act. 4. a) The Ld. CIT (A) erred in confirming the disallowance of the interest amounting to Rs. 1,05,54,407. The Ld. CIT (A) failed to take into consideration that the interest only upto the date of asset utilized has been claimed to the cost of the asset, and the balance was charged accordingly in the Profit and Loss A/c for the year ended as on 31.03.2012. b) The Ld. CIT (A) failed to take into accoun before the Ld. AO vide letters dated 27.01.2015 and 24.02.2016 during the original scrutiny assessment which explained the above claim. 5. a) The Ld. CIT (A) erred in upholding the disallowance of additional depreciation amounti Appellant was processing and not manufacturing, which was eligible for additional depreciation. b) The Ld. CIT (A) failed to consider the wider and beneficial interpretation of the term \"manufacture\" b the Appellant and without citing any judicial pronouncements in his favour. 6. The appellant craves to add, alter, modify or delete any of the grounds of appeal at any time during the pendency of the appeal. 2. At the outset, the learned counsel for the assessee invited our attention to Ground No. 1(a) of the appeal and submitted that the Taloja Steel (Formerly known as Paramshakti Steel Ltd) b) The Ld. CIT (A) failed to provide an adequate opportunity to the 2. a) The Ld. CIT (A) erred in confirming the ex-parte assessment order by the Ld. AO when during the assessment proceedings, the company was under the NCLT and the Appellant was unable to attend the hearings 3. a) The Ld. CIT (A) erred in confirming the re-opening the assessment u/s 147 when all the necessary documentary evidences with regards to reopening were available with the Ld. AO in original assessment b) The Ld. CIT (A) failed to consider the fact \"a mere chan not a sufficient and cogent ground to reopen the assessment proceedings u/s 147 of the Act. 4. a) The Ld. CIT (A) erred in confirming the disallowance of the interest amounting to Rs. 1,05,54,407. The Ld. CIT (A) failed to take into deration that the interest only upto the date of asset utilized has been claimed to the cost of the asset, and the balance was charged accordingly in the Profit and Loss A/c for the year ended as on 31.03.2012. b) The Ld. CIT (A) failed to take into account the submissions furnished before the Ld. AO vide letters dated 27.01.2015 and 24.02.2016 during the original scrutiny assessment which explained the above claim. 5. a) The Ld. CIT (A) erred in upholding the disallowance of additional depreciation amounting to Rs. 69,25,822 on the ground that activity of the Appellant was processing and not manufacturing, which was eligible for additional depreciation. b) The Ld. CIT (A) failed to consider the wider and beneficial interpretation of the term \"manufacture\" before disallowing the additional depreciation to the Appellant and without citing any judicial pronouncements in his 6. The appellant craves to add, alter, modify or delete any of the grounds of appeal at any time during the pendency of the appeal. At the outset, the learned counsel for the assessee invited our attention to Ground No. 1(a) of the appeal and submitted that the Taloja Steel Service Centre Limited (Formerly known as Paramshakti Steel Ltd) 2 ITA No. 7024/MUM/2025 b) The Ld. CIT (A) failed to provide an adequate opportunity to the parte assessment order by the Ld. AO when during the assessment proceedings, the company was under the NCLT and the Appellant was unable to attend the hearings opening the assessment u/s 147 when all the necessary documentary evidences with regards to reopening were available with the Ld. AO in original assessment b) The Ld. CIT (A) failed to consider the fact \"a mere change of opinion\" is not a sufficient and cogent ground to reopen the assessment proceedings 4. a) The Ld. CIT (A) erred in confirming the disallowance of the interest amounting to Rs. 1,05,54,407. The Ld. CIT (A) failed to take into deration that the interest only upto the date of asset utilized has been claimed to the cost of the asset, and the balance was charged accordingly in the Profit and Loss A/c for the year ended as on 31.03.2012. t the submissions furnished before the Ld. AO vide letters dated 27.01.2015 and 24.02.2016 during the original scrutiny assessment which explained the above claim. 5. a) The Ld. CIT (A) erred in upholding the disallowance of additional ng to Rs. 69,25,822 on the ground that activity of the Appellant was processing and not manufacturing, which was eligible for b) The Ld. CIT (A) failed to consider the wider and beneficial interpretation efore disallowing the additional depreciation to the Appellant and without citing any judicial pronouncements in his 6. The appellant craves to add, alter, modify or delete any of the grounds of appeal at any time during the pendency of the appeal.” At the outset, the learned counsel for the assessee invited our attention to Ground No. 1(a) of the appeal and submitted that the Printed from counselvise.com learned CIT(A) had fixed the date of hearing on 08.09.2025, whereas the impugned order came to be passed earlier on thus contended that no effective opportunity of being heard was afforded to the assessee. 3. We have considered the rival submissions and perused the material available on record. A perusal of paragraph 7.1 of the impugned order reveals tha various dates, namely 25.09.2021, 18.03.2021, 01.01.2025 and 26.08.2025. The learned counsel for the assessee drew our attention to the notice dated 26.08.2025, placed at page 110 of the paper book. On examination thereo was granted time to file written submissions on or before 08.09.2025. However, the impugned order has been passed on 04.09.2025, i.e., prior to the expiry of the time granted for compliance. 4. This sequence of events un assessee was deprived of a reasonable and effective opportunity of being heard. The action of the learned CIT(A) is thus in clear breach of the principles of natural justice, which mandate that no person shall be condemned circumstances cannot be sustained in the eyes of law. 5. Accordingly, the impugned order is set aside, and the matter is restored to the file of the learned CIT(A) with a direction to pass a Taloja Steel (Formerly known as Paramshakti Steel Ltd) learned CIT(A) had fixed the date of hearing on 08.09.2025, whereas the impugned order came to be passed earlier on 04.09.2025. It was thus contended that no effective opportunity of being heard was afforded to the assessee. We have considered the rival submissions and perused the material available on record. A perusal of paragraph 7.1 of the impugned order reveals that notices of hearing were issued on various dates, namely 25.09.2021, 18.03.2021, 01.01.2025 and 26.08.2025. The learned counsel for the assessee drew our attention to the notice dated 26.08.2025, placed at page 110 of the paper book. On examination thereof, it is evident that the assessee was granted time to file written submissions on or before 08.09.2025. However, the impugned order has been passed on 04.09.2025, i.e., prior to the expiry of the time granted for This sequence of events unmistakably demonstrates that the assessee was deprived of a reasonable and effective opportunity of being heard. The action of the learned CIT(A) is thus in clear breach of the principles of natural justice, which mandate that no person shall be condemned unheard. An order passed in such circumstances cannot be sustained in the eyes of law. Accordingly, the impugned order is set aside, and the matter is restored to the file of the learned CIT(A) with a direction to pass a Taloja Steel Service Centre Limited (Formerly known as Paramshakti Steel Ltd) 3 ITA No. 7024/MUM/2025 learned CIT(A) had fixed the date of hearing on 08.09.2025, whereas 04.09.2025. It was thus contended that no effective opportunity of being heard was We have considered the rival submissions and perused the material available on record. A perusal of paragraph 7.1 of the t notices of hearing were issued on various dates, namely 25.09.2021, 18.03.2021, 01.01.2025 and 26.08.2025. The learned counsel for the assessee drew our attention to the notice dated 26.08.2025, placed at page 110 of the f, it is evident that the assessee was granted time to file written submissions on or before 08.09.2025. However, the impugned order has been passed on 04.09.2025, i.e., prior to the expiry of the time granted for mistakably demonstrates that the assessee was deprived of a reasonable and effective opportunity of being heard. The action of the learned CIT(A) is thus in clear breach of the principles of natural justice, which mandate that no person unheard. An order passed in such circumstances cannot be sustained in the eyes of law. Accordingly, the impugned order is set aside, and the matter is restored to the file of the learned CIT(A) with a direction to pass a Printed from counselvise.com fresh, speaking and reasoned ord effective opportunity of hearing to the assessee. Ground No. 1(a) of the appeal is allowed. 6. In view of our decision to restore the matter to the file of the learned CIT(A), the remaining grounds raised in the appeal are rendered academic and do not call for adjudication at this stage. 7. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open Court on Sd/- (SANDEEP SINGH KARHAIL JUDICIAL MEMBER Mumbai; Dated: 26/03/2026 Disha Raut, Stenographer Copy of the Order forwarded to 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file. //True Copy// Taloja Steel (Formerly known as Paramshakti Steel Ltd) fresh, speaking and reasoned order after affording adequate and effective opportunity of hearing to the assessee. Ground No. 1(a) of the appeal is allowed. In view of our decision to restore the matter to the file of the learned CIT(A), the remaining grounds raised in the appeal are rendered academic and do not call for adjudication at this stage. In the result, the appeal of the assessee is allowed for Order pronounced in the open Court on 26/03/2026 SANDEEP SINGH KARHAIL) (OM PRAKASH KANT JUDICIAL MEMBER ACCOUNTANT MEMBER Copy of the Order forwarded to : BY ORDER, (Assistant Registrar) ITAT, Mumbai Taloja Steel Service Centre Limited (Formerly known as Paramshakti Steel Ltd) 4 ITA No. 7024/MUM/2025 er after affording adequate and effective opportunity of hearing to the assessee. Ground No. 1(a) of In view of our decision to restore the matter to the file of the learned CIT(A), the remaining grounds raised in the appeal are rendered academic and do not call for adjudication at this stage. In the result, the appeal of the assessee is allowed for /2026. Sd/- OM PRAKASH KANT) ACCOUNTANT MEMBER BY ORDER, (Assistant Registrar) ITAT, Mumbai Printed from counselvise.com "