TARBIR SINGH SHAHPURI ,MUMBAI V. ITO WARD 30(1)(1), MUMBAI

ITA 3701/MUM/2025

AI Insights

The case involves Tarbir Singh Shahpuri, the appellant, who appealed against the order of the Additional Joint Commissioner of Income Tax (Appeals), Faridabad, which confirmed the disallowance of Rs. 3,43,868 as business expenses. The primary contention was the lack of proper opportunity given to the appellant to substantiate the claims of expenses. The Income-Tax Appellate Tribunal found merit in the appellant's argument that the principles of natural justice were not adhered to, as the CIT(A) dismissed the appeal without sufficient documentary evidence from the appellant, relying instead on general submissions.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 787585 (ITAT-MUMBAI)
• Duration Of Justice: 5 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-11-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Assessment Year: 2014-2015
• Appeal Filed On: 27-05-2025
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Matter Remanded
• Court: TRIBUNAL
• Department Lawyers: PRAVIN SALUNKHE
• Assessee Lawyers: PRASHANT GHUMARE
• Keywords: Business income; Opportunity of being heard; Business expenditure; Cost of acquisition; Principle of natural justice
• Section: 143(3)

Judgement Text

"IN THE INCOME-TAX APPELLATE TRIBUNAL “H(SMC)” BENCH, MUMBAI BEFORE MS. KAVITHA RAJAGOPAL, JUDICIAL MEMBER & SMT.RENU JAUHRI, ACCOUNTANT MEMBER ITA No.3701/MUM/2025 7 (A.Y.2014-15) Tarbir Singh Shahpuri 24, Hari Niwas, C Road, Churchgate, Mumbai-400020. Vs. ITO Ward 30(1)(1) Kautilya Bhavan, Mumbai-400050. \u0001थायी लेखा सं./जीआइआर सं./PAN/GIR No:APFPS3557J Appellant .. Respondent Appellant by : Shri. Prashant Ghumare Respondent by : Shri Pravin Salunkhe, Sr. DR Date of Hearing 13.11.2025 Date of Pronouncement 17.11.2025 आदेश / O R D E R PER RENU JAUHRI [A.M.] :- This appeal is filed by the assessee against the order of the ADDL/JCIT (A) Faridabad [hereinafter referred to as “CIT(A)”] dated 30.03.2025 passed u/s. 250 of the Income-tax Act, 1961 [hereinafter referred to as “Act”] for the Assessment Year [A.Y.] 2014-15. The grounds of appeal are as follows: “1. THE ORDER IS BAD IN LAW, ILLEGAL AND WITHOUT JURISDICTION 1.1. In the facts and the circumstances of the case, and in law the appellate order framed by the Additional Joint Commissioner of Income tax (Appeals), Faridabad [Ld. CIT (A)'] is bad in law, illegal and without jurisdiction, as the same is framed in breach of the statutory provisions Printed from counselvise.com P a g e | 2 ITA NO. 3701/mum/2025. of the Income tax Act. 1961 [the Act'] and the scheme and as otherwise also is not in accordance with the law 1.2. Without prejudice to the generality of the above, the appellate order so passed is bad in law, illegal and void as the same is arbitrary and perverse 2. VIOLATION OF PRINCIPLES OF NATURAL JUSTICE 2.1. In the facts and the circumstances of the case, and in law, the appellate order so framed in bad in law and illegal, as the same is framed in breach of the principles of Natural Justice. 2.2 Without prejudice to the generality of the above ground. in the facts and the circumstances of the case, the Ld. CIT (A) erred in- (i) not granting proper. sufficient, reasonable and fair opportunity of being heard to the Appellant while passing the appellate order: (ii) not granting an opportunity of personal hearing. WITHOUT PREJUDICE TO THE ABOVE 3. DISALLOWANCE OF RS. 3,43,868/- AS ALLEGED EXPENSES NOT RELATED TO BUSINESS ACTIVITIES 3.1. The Ld. CIT (A) erred in confirming the action of the A.O. in making disallowance of the amount of Rs. 3,43,868/-, being claim of various expenses incurred wholly and exclusively for the purposes of the business of the Appellant, on the ground of alleged non-submission of documentary evidences in support of this claim. 3.2 While doing so, the CIT (A) erred in: (i) Basing her action on surmises, suspicion and conjecture: (ii) Taking into account irrelevant and extraneous considerations, and (iii) Ignoring relevant material and considerations as submitted by the Appellant. (iv) Not treating the amount paid towards service tax and securities transaction tax as a part of the cost of acquisition of shares, if these expenses were not allowable as business expenditure. 3.3 It is submitted that in the facts and the circumstances of the case. and in law. no such disallowance was called for 3.4 Without prejudice to the above, in the alternative, assuming but not admitting that some disallowance was called for, the Ld. CIT (A) failed to appreciate that the computation of the disallowance made by the A.O. was arbitrary, excessive and not in accordance with the law. Printed from counselvise.com P a g e | 3 ITA NO. 3701/mum/2025. 4. LIBERTY The Appellant craves leave to add, alter, delete or modify all or any the above ground at the time of hearing.” 2. Brief facts of the case are that the assessee filed his return for A.Y. 2014- 15 on 09.09.2015 declaring income of Rs. 40,44,280/-. The case was selected for scrutiny and the assessment was completed u/s. 143(3) on 23.12.2016 determining total income at Rs. 45,74,530/- after making disallowance of Rs. 3,43,868/- out of expenses claimed against business income. Aggrieved, the assessee preferred an appeal before ld. CIT(A). Vide order dated 03.03.2025, ld. CIT(A) dismissed the appeal of the assessee on the ground that no supporting documentary evidences were furnished besides a reply containing general submissions. Further aggrieved, the assessee has filed an appeal before the Tribunal. 3. Before us, ld. AR has submitted that the assessee was not given proper opportunity by ld. CIT(A) to demonstrate the genuineness of expenses claimed. He has therefore, requested that the matter be remanded to ld. CIT(A) for fresh adjudication on merits after giving due opportunity to the assessee. Ld. DR has also not opposed this proposition. 4. After hearing the rival submissions, we deem it appropriate to restore the matter to ld. CIT(A) for a fresh decision on merits after providing adequate opportunity to the assessee. Printed from counselvise.com P a g e | 4 ITA NO. 3701/mum/2025. 5. In the result, assessee’s appeal is allowed for statistical purposes. Order Pronounced in Open Court on 17.11.2025 Sd/- Sd/- (KAVITHA RAJAGOPAL) (RENU JAUHRI) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) Place: Mumbai Date 17.11.2025 Anandi.Nambi/STENO आदेश की \u0015ितिलिप अ\u001aेिषत/Copy of the Order forwarded to : 1. अपीलाथ\b / The Appellant 2. थ\b / The Respondent. 3. आयकर आयु\u0011 / CIT 4. िवभागीय ितिनिध, आयकर अपीलीय अिधकरण DR, ITAT, Mumbai 5. गाड\u001b फाईल / Guard file. स ािपत ित //True Copy// आदेशानुसार/ BY ORDER, उप/सहायक पंजीकार (Dy./Asstt. Registrar) आयकर अपीलीय अिधकरण/ ITAT, Bench, Mumbai. Printed from counselvise.com "