ROZINA NEAL SHAH,MUMBAI vs. ITO WARD 22(1)(6),MUMBAI, PIRAMAL CHAMBERS LALBAG, MUMBAI

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ITA 5811/MUM/2026Status: DisposedITAT Mumbai11 August 2026AY 2016-176 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal restored the appeal to the file of the CIT(A) for fresh adjudication on merits, allowing the assessee one more opportunity to present its case. A cost of Rs. 5,000/- was imposed on the assessee for non-appearance.

What were the facts?

The assessee purchased an immovable property for Rs. 1,50,00,000/- but did not file a regular return of income. The Assessing Officer (AO) reopened the case and added Rs. 38,46,173/- to the assessee's income as unexplained investment. The assessee's appeal before the CIT(A) was dismissed for non-prosecution.

What were the issues?

Whether the assessee deserves another opportunity to present their case before the CIT(A) after the appeal was dismissed for non-prosecution, and whether the addition made by the AO on account of unexplained investment in property is justified.

Which sections of the Income-tax Act were involved?

Section 139,Section 147,Section 144,Section 144B,Section 148,Section 250,Section 69,Section 269SS

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI

Before: SHRI OM PRAKASH KANT & SHRI ANIKESH BANERJEE

For Respondent: Shri. Pravin Salunkhe, Sr. DR

आदेश / ORDER PER SHRI ANIKESH BANERJEE, JUDICIAL MEMBER:

The instant appeal of the assessee filed against the order of the NFAC, Delhi [for brevity “Ld. CIT(A)”], order passed under Section 250 of the Income Tax Act, 1961 (for brevity ‘the Act’), for Assessment Year 2016-17, date of order 18.03.2026. The impugned order emanated from the order of the Assessment Unit Income Tax Department (for brevity ‘Ld. AO’), order passed under Section 147 r.w.s. 144 r.w.s. 144B of the Act date of order 06.03.2024.

2.

The brief fact of the case are that the case of the assessee was selected for scrutiny as per the Risk Management Strategy, for which information has been flagged on Insight portal due to purchase of immovable property of Rs.1,50,00,000/- during the impugned financial year. The Ld. AO found that the assessee has not filed regular return of income for A.Y.2016-17 as per the provisions of section 139 of the Act, and have entered into the transactions as mentioned above. Accordingly, notice u/s 148 of the Act was issued in the case of the assessee, on 23.03.2023. The assessee has not filed return of income in compliance to notice u/s 148 of the Act. The Ld. AO framed the reassessment by noting the following observations which are reproduced as below:-

“4.6 Conclusion drawn-

4.6.1 As per the specific information and on examination of the purchase deed dated 16.01.2016, it is revealed that the assessee along with Shri Neal Umesh Shah (husband) (PAN- AADPS3281J) have jointly purchased a property flat no. 1205, Prathampad Cooperative Housing Society Ltd, Evershine Nagar, Malad (West) Mumbai, for consideration of Rs.1,50,00,000/- and paid a stamp duty of Rs.7,50,000/-, fee Rs.30780/-. Hence, total investment in the property is Rs.1,57,80,780/-. The assessee was requested to furnish the source & nature of the transaction, details/documents from time to time vide notice issued to her. The reply/ details/ documents/ sale deed furnished by the assessee have been examined on test check basis. The assessee have furnisheda copy of statement for claiming deduction u/s 24(b) & 80(c)(2) (xviii) of the IT Act from ICICI Bank. As per the statement, the assessee alongwith her husband Shri Neal Umesh Shah in which the assessee is coborrower, have taken loan of Rs.80,88,434/- from ICICI Bank Ltd on 23 Jun 2017. The assessee had earlier taken home loan from State Bank of India which they have shifted to ICICI Bank, Further, the assessee have not provided bank account statement and not furnished the schedule and mode of payment arranged for purchase of immovable property except the home loan certificate from ICICI Bank Itd. The assessee have not furnished corroborative evidences The assessee in her reply stated that they have sold their old house for Rs.72 Lakhs, but not provided the details of payment received and mode of payment received to verify the authenticity of the same, In absence of the same, there is possibility of having received payment in cash in contravention of sec 269SS of the IT Act. The assessee have neither furnish copy of her bank account statement nor her husband's bank account statement which could have address the issue. In Nutshell, the assessee have not furnished corroborative evidences to establish/ explain the source of funds arranged for purchase of immovable property with supporting documentary evidence. In view of the above, it is concluded as:

Particulars Amount Share of Assessee

Rs.157,80,780/- Rs.78,90,390/- Purchase value of the property including stamp duty and fee A

Loan taken from ICICI Bank in joint capacity. B Rs. 80,88,434/- Rs.40,44,217/-

Source unexplained (A-B) in the case of the assessee Rs.38,46,173/-

The assessee have not explained source of payment amounting to Rs.38,46,173/- in purchase of immovable property alongwith supporting documentary evidence. In absence of any supporting documentary evidences, the source of payment is not verifiable. Thus, the nature and source of payment for purchase of immovable property, remained unexplained. Hence, Rs.38,46,173/- is added to the income of the assessee as unexplained investment u/s 69 of the IT Act,

The Ld. AO confirmed the addition amount to Rs. 38,46,173/-. Being aggrieved assessee filed an appeal before the Ld. CIT(A). But the Ld. CIT(A) rejected the appeal for non prosecution. Being aggrieved the assessee filed an appeal before us.

3.

The Ld. AR argued and filed a paper book comprising of pages 1 to 89 which has been placed on record. The Ld. AR explained that the assessee purchased the new property by the an agreement dated 16.01.2016. On the other hand the assessee sold the old property dated 04.12.2025 amount to Rs.72lakh. The payment receipt, Bank Statement, Form No-26AS of husband, Mr. Neal Umesh Shah is reflecting the sales & purchase of the properties. So, the assessee has invested from her explained source. The Ld. AR contended that in appellate proceeding the assessee had submitted all the relevant documents on dated 10.02.2026 related to notice u/s 250 of the Act dated 04.02.2026. The relevant e-Proceeding Response Acknowledgement is placed on record. But related to non-compliance of other notices issued u/s 250 of the Act the Ld. AR remained silent.

4.

The Ld. DR argued and contended that the assessee had not complied the notices issued by the Ld. CIT(A). No such proper explanation was filed for non-compliance before the Ld. CIT(A). The Ld. DR stands in favor of the orders of revenue authorities.

5.

We heard the rival submission and considered the documents available in the record. The assessee has not filed the regular return and the assessee’s case was reopened related to the transaction of immovable property as information from ‘RMS’. The Ld. AO assessed the income exparte u/s 144 of the Act and added back amount to Rs. 38,46,173/- for investment in immovable assets from undisclosed source. Being aggrieved on assessment order the assessee has preferred an appeal before the Ld. CIT(A). However, the appeal was disposed of exparte due to nonappearance on the part of assessee. During the course of hearing before us, the Ld. AR was unable to satisfactorily explained the reasons for non-compliance during appellate proceeding. But it is submitted that the assessee has complied one of the notices dated 04.02.2026 by filing details evidence on dated 10.02.2026. The Ld. DR objected to the assessee’s plea and submitted that the reasons for non-compliance had not been properly substantiated or supported by any cogent material & in both the stages the orders are passed exparte. Therefore, in the interest of substantial justice, and principle of natural justice, we are of the considered view that the assessee deserves one more opportunity to present its case before the Ld. CIT(A). During the course of hearing, the Ld. AR was ready to bear the reasonable costs for non-appearance in the appellate proceedings. Accordingly, the acceptance of the Ld. AR was fairly accepted by the Ld. DR. So, we impose a cost of Rupees Five Thousand (Rs.5000/-) upon assessee which shall be deposited under the “other head” of the Income Tax Department within one month from the date of receipt of this order. Subject to verification of payment of the aforesaid cost, by the Ld. CIT(A), all the issues are restored to the file of Ld. CIT(A) for adjudication afresh on merits in accordance with law. We make it clear that we have not expressed any opinion on merit of the case. So, as to ensure that the appellate proceedings before the Ld. CIT(A) remain uninfluenced. Needless to say, the assessee shall be afforded a reasonable opportunity of being heard and shall also extend full cooperation for expeditious disposal of the appellate proceedings.

6.

In the result, the appeal of the assessee bearing ITA No.5811/Mum/2026 is allowed for statistical purpose.

Order pronounced in the open court on 11th day of August 2026 Sd/- Sd/-

(OM PRAKASH KANT) (ANIKESH BANERJEE) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai,िदनांक/Dated: 11/08/2026 Soumili, PS

Copy of the Order forwarded to: अपीलाथ�/The Appellant , 1. �ितवादी/ The Respondent. 2. आयकरआयु� CIT 3. िवभागीय�ितिनिध, आय.अपी.अिध., मुंबई/DR, ITAT, 4. Mumbai गाड�फाइल/Guard file. 5.

BY ORDER, //True Copy// (Asstt. Registrar), ITAT, MUMBAI

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