POWERED MULTITRADE PRIVATE LIMITED,MUMBAI vs. ITO WARD 7(3)(1), MUMBAI

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ITA 318/MUM/2026Status: DisposedITAT Mumbai31 August 2026AY 2012-137 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal condoned the delay in filing the appeal. The Tribunal set aside the CIT(A)'s order and restored the matter to the CIT(A) for fresh adjudication, considering the outcome of the appeal for the previous assessment year.

What were the facts?

The assessee's appeal was filed with a delay due to a death in the director's family. The addition of Rs. 17,87,000 was made treating it as an unexplained cash credit from share transactions.

What were the issues?

Whether the delay in filing the appeal should be condoned and whether the addition of Rs. 17,87,000 as unexplained cash credit is justified, considering the pending appeal for the previous year.

Which sections of the Income-tax Act were involved?

Section 68,Section 249(3),Section 147,Section 143(3),Section 234B,Section 234C,Section 271(1)(c)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI BENCH “H (SMC

Before: SHRI OM PRAKASH KANT & SHRI ANIKESH BANERJEE

For Appellant: Shri. Mahesh Saboo
For Respondent: Shri. Pravin Salunkhe, Sr. DR
Hearing: 21.08.2026Pronounced: 31.08.2026

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “H (SMC)” MUMBAI

BEFORE SHRI OM PRAKASH KANT (ACCOUNTANT MEMBER) AND SHRI ANIKESH BANERJEE (JUDICIAL MEMBER)

ITA 318/MUM/2026 Assessment Year: (2012-13)

POWERED MULTITRADE PRIVATE ITO WARD 7(3)(1) LIMITED AAYAKAR BHAVAN CHURCHGATE 6-6-10 VIJAY NAGAR SANGH SHAIKH MUMBAI, MUMBAI-400020, Vs. MISREE ROAD ANTOP HILL MUMBAI, MAHARASHTRA. MUMBAI-400037, MAHARASHTRA. Appellant Respondent

PAN No. AAFCP1962L

Appellant represented by: Shri. Mahesh Saboo Respondent represented by: Shri. Pravin Salunkhe, Sr. DR

Date of hearing: 21.08.2026 Date of pronouncement: 31.08.2026

ORDER PER OM PRAKASH KANT, AM

This appeal by the assessee is directed against order dated 27.08.2025 passed in faceless manner by the learned Additional Commissioner of Income-Tax (Appeals), Panchkula [in short 'the learned CIT(A)'] for assessment year 2012-13 (A.Y. 2012-13), raising following grounds: 1. On the facts and circumstances of the case and in law the lower authorities have erred in making/sustaining the addition of Rs. 17,87,000/- u/s 68 of the IT Act, and the reasons assigned for doing so was wholly wrong, irrelevant to the facts of the case and not in accordance with the provisions of Income Tax Act, 1961 and rules made thereunder and against the principles of natural justice.

2) On the facts and circumstances of the case and in law, the appellant hereby make a humble request to kindly condone the delay, if any, in filing of this appeal as death had occurred in the family of the director. 3) On the facts and circumstances of the case and in law, the lower authorities have erred in levying the interest u/s 234B and 234C of the IT which was wholly wrong, and against the provisions of Income Tax At, 1961 and rules made thereunder. 4) On the facts and circumstances of the case and in law, the lower authorities have erred in initiating the penalty proceedings u/s 271(1)(c) of the Income Tax Act, 1961 which were wholly wrong, irrelevant, and not in accordance with the facts and circumstances of the case as no income is concealed nor any inaccurate particulars were furnished.

2.

At the outset, the learned counsel for the assessee submitted that the appeal was filed with a delay of 75 days. In support of the application for condonation, he referred to the affidavit of the Director of the assessee-company, wherein the circumstances leading to the delay have been explained. The relevant portion of the affidavit reads as under: “2) That in or around August 2025, there occured death in the family of the director and I had to go to village for some time. Diwali was also there in this period. During this period the order of CIT(A) was received on mail, and which could not be attended in my absence. 3) I further state that when there was a phone from the IT office that the appeal has been rejected and the recovery was demanded, I came to know recently about the said order of CIT(A). 4) I state that immediately on coming to know about this, I am arranging to file the the further appeal before ITAT as the justice had not been done to me and the company, in disposing off the appeal nor any consistency has been observed which were submitted before FAA. 5) The orders of the CIT(A) is dated 27/08/2025 and the actual appeal before the Hon'ble ITAT could be filed on 13/01/2026. Thus delay had occurred in filing of this appeal by about 110 days. 6) I therefore humbly request your honours to kindly be sympathetic and condone this delay and admit the appeal for justice in the matter. I further state that a grave undue hardship would cause to the appellant if the appeal is not accepted and heard on merits. We therefore humbly request your honours to kindly condone the delay in filing of this appeal for AY 2012-2013. I therefore request your honour to kindly accept the appeal and hear the matter on merits of the case and do the justice.”

3.

The learned Departmental Representative opposed the condonation of delay.

4.

We have considered the rival submissions and perused the material available on record. Section 249(3) of the Income-tax Act, 1961 ( in short ‘the Act’) empowers the appellate authority to admit an appeal after expiry of the prescribed period where it is satisfied that the appellant had sufficient cause for not presenting the appeal within time. The expression “sufficient cause” is required to receive a pragmatic and justice-oriented consideration rather than a pedantic one. The Hon’ble Supreme Court in Collector, Land Acquisition, Anantnag v. Mst. Katiji, (1987) 167 ITR 471 (SC), has emphasized that refusal to condone delay may result in a meritorious matter being shut out at the threshold, whereas condonation merely enables the dispute to be examined on merits. The Hon’ble Supreme Court has also cautioned against presuming that delay is deliberate or actuated by mala fides in the absence of circumstances warranting such a conclusion.

4.1 In the present case, the assessee has placed on record an affidavit explaining the circumstances in which the order of the learned CIT(A) could not be acted upon within the prescribed period. It has been stated that, during the relevant period, the Director had to attend to a death in the family and was away from his usual place of residence; consequently, the communication received by e-mail was not attended to in time. It has further been stated that the assessee became aware of the order only subsequently and, on becoming aware thereof, took steps to pursue the appellate remedy. There is nothing on record before us to suggest that the delay was deliberate, mala fide or intended to gain any advantage.

4.2 In these circumstances, and having regard particularly to the relatively short period of delay and the fact that refusal to condone the same would foreclose examination of the substantive dispute without adjudication on merits, we are satisfied that the assessee has demonstrated sufficient cause within the meaning of section 249(3) of the Act. The delay is accordingly condoned and the appeal is admitted for adjudication.

5.

Coming to the merits, the facts of the case in brief are that the assessee had originally filed its return of income for Assessment Year 2012-13 on 31.03.2013, declaring total income of Rs.333/-. Subsequently, information was received from the Investigation Wing, Kolkata, indicating that the assessee had received an aggregate amount of Rs.73.87 lakhs through RTGS from M/s Moonlink Dealcomm Pvt. Ltd., out of which amount of Rs.17,87,000/- was received in year under consideration and amount of Rs. 56 lakhs was received in earlier assessment year. On the basis of such information, the assessment was reopened under Section 147 of the Act.

5.1 The Assessing Officer, while completing the reassessment under section 147 read with section 143(3) vide order dated 19.12.2019, made an addition of Rs.17,87,000/-, being the amount received from M/s Moonlink Dealcomm Pvt. Ltd. during the year under consideration, treating the same as unexplained cash credit. On further appeal, the learned CIT(A) also upheld the addition, observing as under: “6.2 The assessee was required to establish identity, creditworthiness and genuineness of the credits. Though PAN and confirmations were filed, notices issued by the Assessing Officer to the creditor companies were returned unserved and their directors were not produced. The financials of the creditors reveal poor creditworthiness. No supporting evidence such as contract notes, share transfer forms, or details of holding period of investments were produced. The contention of the assessee that only commission should be disallowed is untenable because the assessee is not an entry provider but the beneficiary of the entries, and hence the whole amount represents its undisclosed income. In the present case, the assessee has failed to discharge its onus. Accordingly, the Assessing Officer was justified in treating the sum of Rs.17,87,000/- as unexplained cash credit. Accordingly, Ground No. 2 of the appeal is also dismissed.”

6.

Before us, the learned counsel submitted that the impugned receipt of Rs.17,87,000/- is part of the aggregate amount of Rs.73.87 lakhs received from the aforesaid entities, of which Rs.56 lakhs pertained to Assessment Year 2011-12 and the balance Rs.17.87 lakhs pertains to the year under consideration. It was submitted that the receipts represented consideration for sale of shares held by the assessee as investments. It was further submitted that the addition of Rs.56 lakhs made in Assessment Year 2011-12 is itself under challenge before the learned first appellate authority, where certain additional evidence relating to the share transactions has been furnished. According to the learned counsel, the adjudication of that appeal would have a direct bearing upon the issue involved in the present year and, therefore, the matter may appropriately be restored to the learned CIT(A).

7.

We have considered the rival submissions and perused the material on record. We note that the ld CIT(A) has dismissed the appeal on merit mainly for not supporting the alleged purchase/ sale transaction with documentary evidences like contract note of purchase/ sale etc. The case has been reopened on the basis of information that an aggregate amount of Rs.73.87 lakh was received from the aforesaid entities, of which Rs.56 lakh pertained to Assessment Year 2011-12 and the balance Rs.17.87 lakh pertains to the year under consideration. The ld Counsel has submitted before us the appeal for AY 2011-12 is pending before the ld first appellate authority where additional evidences comprising of contract note of purchase and sale have been filed as additional evidence. We are of opinion that the dispute in the present year cannot be viewed in isolation from the corresponding transaction of Rs.56 lakhs considered in Assessment Year 2011- 12, since both receipts admittedly form part of the aggregate amount received from the same party and arise from the assessee's stated share transactions.

7.1 In these circumstances, we consider it appropriate, in the interest of a proper and effective adjudication, to set aside the impugned order of the learned CIT(A) and restore the matter to his file for fresh adjudication on merits. While doing so, the learned CIT(A) shall take into consideration the outcome of the appellate proceedings for Assessment Year 2011-12, insofar as the same has a bearing upon the nature and genuineness of the corresponding share transaction and receipt of Rs.17,87,000/- in the year under consideration. Needless to say, the assessee shall be afforded adequate opportunity of being heard and to place such material as may be relevant to the controversy.

7.2 We make it clear that we have expressed no opinion on the merits of the addition of Rs.17,87,000/-, and all contentions of the parties on the merits are left open.

7.3 Accordingly, Ground No. 1 is allowed for statistical purposes. The ground relating to condonation of delay stands allowed in terms of paragraph 5 above. The remaining grounds are consequential or premature and shall be dealt with, if necessary, in accordance with law while adjudicating the appeal on merits.

8.

In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open Court on 31/08/2026.

Sd/- Sd/- (ANIKESH BANERJEE) (OM PRAKASH KANT) JUDICIAL MEMBER ACCOUNTANT MEMBER Mumbai; Dated: 31/08/2026 M. Ranganath Vittal , Sr. P.S.

Copy of the Order forwarded to : 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file.

BY ORDER, //True Copy// (Assistant Registrar) ITAT, Mumbai

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