M D RUPAREL AND SONS,MUMBAI vs. INCOME TAX OFFICER-24(2)(1), MUMBAI

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ITA 3831/MUM/2026Status: DisposedITAT Mumbai20 August 2026AY 2020-20215 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal condoned the delay in filing the appeal and set aside the order of the Assessing Officer. The matter was restored to the AO for fresh adjudication after providing the assessee with an adequate opportunity of hearing.

What were the facts?

The assessee's appeal was dismissed ex-parte by the CIT(A) without adequate opportunity of being heard. The disallowance of commission expenditure was confirmed based on non-reflection of TDS in Form 26AS, without independent verification.

What were the issues?

Whether the CIT(A) erred in dismissing the appeal ex-parte and confirming disallowance of commission expenditure solely based on Form 26AS without independent verification.

Which sections of the Income-tax Act were involved?

Section 194H

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI BENCHES, MUMBAI

Before: SHRI SANDEEP GOSAIN

Pronounced: 20.08.2026

PER SHRI SANDEEP GOSAIN, JUDICIAL MEMBER:

This appeal is filed by the Assessee against the order of Ld. OFFICE OF COMMISSIONER OF INCOME TAX, APPEALS vide DIN: ITBA/AST/S/143(3)/2022-23/1045899307(1) dated 23-Jul-2024 for the Assessment Year 2020-2021. The Assessee has raised the following grounds of appeal:

1) On the facts and in the circumstances of the case, the learned CIT(A) erred in dismissing the appeal ex-parte without providing adequate opportunity of being heard, in violation of principles of natural justice. On the facts and in the circumstances of the case and in law, the learned CIT(A) erred in confirming the disallowance of ₹40,73,642/- made by the Assessing Officer under section 194H of the Income-tax Act, 1961on on perusal of Form 26AS of commission parties on ground that no payment was made to parties. 2) The learned CIT(A) and Assessing Officer erred in disallowing the commission expenditure solely on the basis of non-reflection of TDS in Form 26AS of the recipients, without conducting independent verification. 3) The authorities below failed to appreciate that the commission expenses were genuine, incurred wholly and exclusively for business purposes, and supported by necessary evidences. 4) The Assessing Officer erred in not considering the submissions and corroborative evidences furnished by the appellant during assessment proceedings. 5) That the Learned Officer has wrongly imitated Penalty proceedings separately Order dated 30.03.2023 of Rs. 6,35,488 6) Without prejudice to the above, the disallowance made is excessive, unjustified, and liable to be deleted. The appellant craves leave to add, amend, alter, OR withdraw any of the above grounds at the time of hearing.

2.

At the very outset, I noticed that there is a delay of approximately 547 days in filing the appeal before me. Considering the entire factual position as explained before me and also keeping in view the principles laid down by the Hon’ble Supreme Court in the case of Collector, Land Acquisition, Anantnag & Anr. vs. Mst. Katiji & Ors. [1987 AIR 1353 (SC)], wherein it has been held that where substantial justice is pitted against the technicalities of a non-deliberate delay, substantial justice is to be preferred, I am of the view that the principle of advancing substantial justice is of prime importance. Hence, considering the explanation put forth by the assessee, who has justifiably and properly explained the delay that occurred in filing the appeal, and construing the expression “sufficient cause” liberally, I am inclined to condone the delay in filing the appeal before me. Consequently, the delay is condoned and the appeal is admitted for hearing on merits.

3.

From the records, I also noticed that the assessee was proceeded ex parte before the AO as well as the Ld. CIT(A). Consequently, considering the documents placed on record, the Ld. CIT(A) dismissed the appeal.

4.

Be that as it may, without going into the merits of the issues raised by the assessee and considering the fact that the assessee could not effectively represent his case before the Revenue Authorities, I am of the view that one more opportunity be given to the assessee to represent his case before the AO. Accordingly, considering the overall circumstances of the present case, I deem it proper to set aside the order passed by the AO and restore the matter to the file of the AO for deciding the same afresh after providing adequate and sufficient opportunity of hearing, subject to a cost of Rs. 5,000/- imposed upon the assessee, which shall be deposited in the Prime Minister National Relief Fund. A copy of the receipt shall be placed on record before the AO within 30 days from the date of receipt of this order. The assessee shall not seek any adjournment on frivolous grounds and shall remain cooperative during the course of the proceedings.

5.

Before parting, I wish to make it clear that my decision to restore the matter to the file of the AO shall in no way be construed as reflecting upon or expressing any opinion on the merits of the dispute, which shall be adjudicated independently by the AO in accordance with law.

6.

Needless to mention, the AO shall provide an adequate opportunity of hearing to the assessee. The assessee shall not seek any adjournment on frivolous grounds and shall remain cooperative during the course of the proceedings.

7.

In the result, the appeal filed by the assessee stands allowed for statistical purposes.

Order pronounced in the open court on 20.08.2026.

Sd/- SANDEEP GOSAIN JUDICIAL MEMBER Mumbai Dated: 20.08.2026 RY-SrPS Copy to: M D RUPAREL AND SONS, 1-A, TORANA APTS ,SAHAR CARGO ROAD, OPP P AND T COLONY, ANDHERI 1 EAST, MUMBAI-400099, MAHARASHTRA

INCOME TAX OFFICER-24(2)(1), PIRAMAL CHAMBER, LALBAUG, PAREL 2 ,MUMBAI, MUMBAI-400012, MAHARASHTRA

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

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