GHATKOPAR DEVANG CO-OPERATIVE HOUSING SOCIETY LIMITED,MUMBAI vs. INCOME TAX OFFICER, WARD 4(2)(1), MUMBAI

ITA 4954/MUM/2026Status: DisposedITAT Mumbai15 September 2026AY 2023-249 pages
AI SummaryRemanded

What were the facts?

The assessee, Ghatkopar Devang Co-Operative Housing Society Limited, filed appeals against the orders of the Commissioner of Income-tax (Appeals) for Assessment Year 2023-2024. The appeals challenged quantum assessment proceedings under section 143(3) and penalty proceedings under section 270A. The Assessing Officer treated an amount of Rs. 17,38,15,500/- reported by the Joint Sub-Registrar as sale of property and assessed it as unexplained and undisclosed income under the head 'Short-Term Capital Gains'. The assessee contended this amount did not represent any sale transaction or income in its hands. The CIT(A) dismissed the appeal for the quantum assessment on grounds of delay, without condoning it or adjudicating on merits. The penalty appeal was consequential. The assessee sought condonation of delay before the Tribunal, citing reasons such as senior citizen office bearers unfamiliar with online procedures, shifting of office premises, and an employee leaving the job.

What did the Tribunal hold?

The Tribunal found that the primary issue was the refusal by the learned CIT(A) to condone the delay in filing the quantum appeal. The assessee provided reasons for the delay, including the senior citizen status of office bearers, their unfamiliarity with online procedures, a change in office premises due to development work, and the departure of an employee handling compliances. The Tribunal also considered the additional evidence submitted by the assessee, including a development agreement, bank statements, and financial statements, which indicated that the society was a confirming party and had not received any income from the transactions. In the interest of substantive justice, the Tribunal deemed it appropriate to restore the matter back to the file of the learned CIT(A) for reconsideration of the issue of condonation of delay in accordance with law, without being influenced by the Tribunal's observations. The penalty appeal, being consequential, was also set aside and restored for fresh decision after the quantum appeal proceedings are concluded. The ratio decidendi is that procedural delays, if explained with sufficient cause, should not prevent substantive justice, and the CIT(A) should adjudicate on merits after considering condonation.

What were the issues?

1. Whether the Commissioner of Income Tax (Appeals) erred in dismissing the assessee's appeal solely on the ground of delay, without condoning the delay and adjudicating the appeal on merits, as per Section 249(2) of the Income-tax Act, 1961. 2. Whether the Assessing Officer erred in treating the amount of Rs. 17,38,15,500/- as unexplained and undisclosed income under the head 'Short-Term Capital Gains', when it represented the value of a development agreement, compensation payable to members, and transactions between individual members/new buyers and the developer, not income of the assessee society. Assessee's Arguments: - The CIT(A) wrongly dismissed the appeal due to delay without condoning it. Reasons for delay included office bearers being senior citizens unfamiliar with online procedures, office relocation, and an employee's departure. - The amount of Rs. 17,38,15,500/- was not income of the society. It comprised Rs. 14,29,66,000/- (value of development agreement for stamp duty purposes), Rs. 1,37,49,500/- (50% of value of transactions between existing members and developer), and Rs. 1,71,00,000/- (50% of purchase agreement value between new buyer and developer). The society was merely a confirming party and derived no benefit or income. - The society's PAN was mistakenly used for reporting under Section 285BA by the stamp authority. - Bank statements and financial statements did not reflect any receipt or transfer of property. Revenue's Arguments: - The judgment records no specific arguments from the revenue regarding the merits of the addition or the delay in filing the appeal before the CIT(A).

Which sections of the Income-tax Act were involved?

Section 270A,Section 143(3),Section 250,Section 249(2),Section 285BA

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI BENCH “G”, MUMBAI

Before: SHRI NARENDER KUMAR CHOUDHRY & SHRI RAKESH KUMAR LODHA

For Appellant: Shri B. M. Agarwal a/w, Shri Rajesh Agrawal
For Respondent: Shri Basavaraj Hiremath
Hearing: 06.08.2026Pronounced: 15.09.2026

Heard together (2 matters)

ITA No.4954/MUM/ 2026
ITA No.4955/MUM/ 2026

Read from the judgment's own cause title. This page is filed under one of them.

PER : Shri Rakesh Kumar Lodha, Accountant Member:

These appeals have been filed by the assessee against orders

under section 250 of the Income-tax Act, 1961, [in short “the Act”]

ITA NO.4954 & 4955 GHATKOPAR DEVANG CO OPERATIVE HOUSING SOCIETY LIMITED AY 2023-2024

passed by the learned Commissioner of Income-tax (Appeals), dated 20th February, 2026, for the assessment year 2023-24, relating to quantum assessment proceedings u/s 143(3) of the Act and penalty proceedings u/s 270A o

The order continues below.

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