NAVRATTAN BLUE CRETE INDUSTRIES PRIVATE LIMITED,MUMBAI vs. ASSISTANT COMMISSIONER OF INCOME TAX, MUMBAI

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ITA 1203/MUM/2026Status: DisposedITAT Mumbai03 September 2026AY 2016-20178 pages

In favour of the Revenue: the assessee's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The ITAT dismissed the assessee's appeal as they did not appear and no new evidence was presented to controvert the CIT(A)'s findings. The tribunal found no reason to interfere with the CIT(A)'s order.

What were the facts?

The assessee's appeal against the CIT(A)'s order was dismissed by the ITAT as the assessee failed to appear. The CIT(A) had confirmed additions made by the AO, treating receipts as revenue despite the assessee claiming they were capital advances for a large project.

What were the issues?

Whether the receipts were capital advances or revenue income, and the validity of the assessment proceedings when the assessee failed to appear and present their case.

Which sections of the Income-tax Act were involved?

Section 144,Section 139(4),Section 139(5)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI BENCHES, MUMBAI

Before: SHRI SANDEEP GOSAIN & SHRI JAGADISH

Pronounced: 03.09.2026

PER SHRI SANDEEP GOSAIN, JUDICIAL MEMBER:

This appeal is filed by the Assessee against the order of Ld. COMMISSIONER OF INCOME TAX APPEAL vide DIN: ITBA/NFAC/S/250/2025-26/1083588805(1) dated 02-Feb-2026 for the Assessment Year 2016-2017. The Assessee has raised the following grounds of appeal:

1.

Assessment vitiated by fundamental mischaracterisation of capital receipts The learned CIT(A) erred in law and on facts in confirming the assessment wherein amounts received from Mr. Bharat Bomb and Mr. Deepak Parihar were treated as revenue income, despite incontrovertible evidence establishing that the said receipts were capital advances / deposits towards a capital-intensive license and joint venture project valued at Rs. 1,800 Crores.

2.

Failure to consider binding commercial agreements and their breach The learned CIT(A) failed to appreciate that under the License and Joint Venture Agreement dated 26.03.2014, the Investor Group was contractually obligated to infuse substantial capital (initial non-refundable deposit of Rs. 60 Crores against an overall license valuation of approximately Rs. 1,800 Crores), which was never fulfilled, rendering the project abortive and the receipts incapable of being characterised as income.

3.

Ignoring contemporaneous evidence of capital deployment and project expenditure The learned CIT(A) erred in ignoring the uncontroverted factual record demonstrating that the Appellant had already deployed the amounts received towards capital and pre-operative expenditure, including setting up pilot plants, taking factory premises on rent in Mumbai (Nerul), installing machinery, procuring raw materials, engaging scientists, and supplying 1,298 cement bags and samples to the Investor Group for technical and commercial demonstrations.

4.

Assessment based on distorted accounting entries made under fiduciary control and collusion The learned CIT(A) failed to consider that Mr. Deepak Parihar, who acted simultaneously as financial advisor and Chartered Accountant to the Appellant and its promoters, exercised dominant control over banking operations and accounting treatment. The erroneous reflection of capital receipts as revenue arose under his influence and was later weaponised against the Appellant during assessment proceedings, constituting a grave breach of fiduciary duty.

5.

Non-consideration of subsequent investigative findings and regulatory actions The learned CIT(A) erred in law in disregarding subsequent and continuing investigations by CBI and Enforcement Directorate, including attachment of bank accounts and assets, which conclusively demonstrate that the Appellant did not earn any real income from the impugned transactions and that the entire business was commercially destroyed.

6.

The learned CIT(A) failed to apply the settled doctrine that only real income can be subjected to tax. In the present case, no income accrued or arose to the Appellant; on the contrary, the project collapsed due to deliberate non-performance, fraud, and misappropriation by the Investor Group.

7.

Improper confirmation of best judgment assessment under section 144 The learned CIT(A) erred in mechanically affirming a best judgment assessment framed under section 144, ignoring the CBDT Instruction dated 12.12.2017 governing defective returns and failing to consider audited financials and revised computation showing negligible taxable income.

8.

Failure to consider catastrophic losses suffered by the Appellant The learned CIT(A) failed to appreciate that the Appellant suffered extensive and irreversible losses-financial, reputational, business, and emotional-resulting from the collapse of the project, theft of intellectual property, fraudulent diversion of funds, and prolonged regulatory and criminal proceedings.

9.

Right The Appellant craves leave to add, amend, alter, or delete any of the above grounds at the time of hearing.

2.

None appeared on behalf of the assessee even after repeated calls. Even on the previous day of hearing, the assessee had sought adjournment by filing a written request, and thus the matter was fixed at the request of the assessee for today. But even then, none appeared on behalf of the assessee, which shows that the assessee is not interested in prosecuting the appeal. Therefore, we proceed ex parte against the assessee. On the contrary, learned DR appeared. Therefore, we have decided to adjudicate the present appeal by considering the documents placed on record.

3.

We noticed that, through numerous grounds, the assessee has challenged the jurisdictional and merits of the additions made by the AO. Therefore, after hearing the learned DR and perusal of the documents placed

on record, we found that the assessee had filed a return of income for the year under consideration.

4.

Although CPC treated the said return as invalid since the defects were not rectified within the stipulated time, the ITR was transferred to the jurisdictional Assessing Officer. However, notice under section 143(2) was issued for selection of scrutiny on the basis of the invalid return, and consequently, the Assessing Officer treated the return as an invalid return.

5.

The findings of the learned CIT(A) are contained on pages 11 to 15, and the same are reproduced hereinbelow:

6.

After evaluating the orders passed by the learned CIT(A), we found that the CIT(A) has dealt specifically with each ground raised by the assessee. As far as the filing of the return is concerned, the learned CIT(A) has categorically mentioned that the return filed by the assessee was treated as a belated return and the assessee cannot file a revised return under section 139(5) since the original return was filed under section 139(4) of the Act. Thus, he was of the view that since the return filed by the assessee was treated as a defective return and the defect had to be cured within 15 days, and since the same was not cured, the return was rightly considered as invalid.

7.

As far as the other grounds are concerned, the CIT(A) has dealt with the other grounds in detail also, which have been reproduced above.

8.

Even otherwise, no new facts or circumstances or documents have been placed on record by the assessee in order to controvert or rebut the lawful findings so recorded by the learned CIT(A). Therefore, we see no reason to interfere with or deviate from the findings so recorded by the learned CIT(A). Hence, we dismiss the grounds raised by the assessee and uphold the order of the learned CIT(A).

9.

In the result, the appeal filed by the assessee stands dismissed.

Order pronounced in the open court on 03.09.2026.

Sd/- Sd/- JAGADISH SANDEEP GOSAIN ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai Dated: 03.09.2026 RY-SrPS Copy to: NAVRATTAN BLUE CRETE INDUSTRIES PRIVATE LIMITED, 604, TRADE CENTRE, BANDRA KURLA 1 COMPLEX, BANDRA EAST, MUMBAI-400051, MAHARASHTRA

ASSISTANT COMMISSIONER OF INCOME TAX, 2 CIRCLE 14(2)(2), AAYAKAR BHAVAN, MUMBAI-400020, MAHARASHTRA

3 THE PCIT / CIT, 4 THE D.R., ITAT, MUMBAI BENCH 5 GUARD FILE

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