SUVIDHA SECURITIES PRIVATE LIMITED,MUMBAI vs. WARD 4(3)(1), MUMBAI, MUMBAI

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “G” MUMBAI

BEFORE SHRI OM PRAKASH KANT (ACCOUNTANT MEMBER) AND SHRI PAWAN SINGH (JUDICIAL MEMBER)

ITA No. 6905/MUM/2025 Assessment Year: 2008-09

Suvidha Securities Private Income Tax Officer, Ward 4(3)(1), Limited, 158/160, 1st Floor, Aayakar Bhawan, Mumbai – Royal Avenue, Dr Vegas street Vs. 400020, Maharashtra. Opp Church Bazar Kalbadevi, Mumbai - 400002. PAN NO. AAFCS 7396 K Appellant Respondent

Assessee by : Ms. Simran Dhawan, Adv.

Revenue by : Shri Rajgopal Parthasarathi – SR DR.

Date of Hearing : 22/07/2026 Date of pronouncement : 29/07/2026

ORDER PER OM PRAKASH KANT, AM

This appeal by the assessee is directed against the order dated 28.08.2025, passed by the learned Commissioner of Income Tax (Appeals) – National Faceless Appeal Centre, Delhi [in short, ‘the Ld. CIT(A)’], for Assessment Year (in short ‘A.Y’), 2008-09, raising following grounds:-

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“1. On the facts and the circumstances of the case and in law, the Ld. Commissioner of Income Tax (Appeals) erred on facts and in law in not deleting the reopening of assessment u/s 147 by issue of notice u/s 148 dated 28.03.2014 by the Assessing Officer, despite the fact that such re-opening proceeding is not as per provisions of law, clearly outside the sanction of law, illegal, bad-in-law, barred by limitation, unsustainable, in gross violation of the principles of natural justice or otherwise void for want of jurisdiction.

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2.1 Subsequently, the Assessing Officer received information from the Assistant Commissioner of Income-tax, Central Circle-41, Mumbai and the Assistant Commissioner of Income-tax, Central Circle-1, Hyderabad alleging that the assessee was one of the entities involved in providing accommodation entries in the guise of share application money and similar transactions. Based upon the said information, the Assessing Officer recorded reasons to believe that income chargeable to tax had escaped assessment within the meaning of section 147 of the Act and accordingly issued notice under section 148 on 28.03.2014. Pursuant thereto, notices under section 142(1) of the Act were issued on different dates. According to the Assessing Officer, despite service of the statutory notices, the

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assessee failed to comply with the requisitions made during the reassessment proceedings. Consequently, invoking the provisions of section 144 of the Act, the Assessing Officer proceeded to complete the reassessment on a best judgment basis.

2.2 While framing the reassessment, the Assessing Officer observed that the investments reflected in the balance sheet of the assessee as on 31.03.2007 aggregated to Rs.26,28,38,500/-. Proceeding on the premise that the assessee was engaged in providing accommodation entries, he estimated commission income at 2% of the aforesaid investments and made an addition of Rs.52,56,770/-.The Assessing Officer further noticed that during the relevant previous year the assessee had received share capital of Rs.7,05,650/- together with share premium of Rs.6,98,59,350/-, aggregating to Rs.7,05,65,000/-. Since no documentary evidence, according to the Assessing Officer, had been furnished to establish the identity and creditworthiness of the subscribers and the genuineness of the transactions, the entire amount was treated as unexplained cash credit under section 68 of the Act and added to the total income of the assessee.

2.3 In this manner, the Assessing Officer made aggregate additions of Rs.7,58,21,770/- and completed the reassessment under sections 147 read with 144 of the Act vide order dated 27.03.2015, determining the total income at Rs.7,58,35,820/-.

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3.1 Aggrieved, the assessee is in appeal before us by way of raising grounds as reproduced above.

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independent satisfaction being recorded by the Assessing Officer and was thus vitiated in law.

4.1 The learned Counsel further submitted that the reasons recorded for reopening were never supplied to the assessee and, therefore, the reassessment proceedings were liable to be quashed on this ground alone. On merits, she drew our attention to the documents contained in the paper book, particularly the copies of confirmations, bank statements, PAN cards, acknowledgements of returns of income and audited financial statements of the share subscribers, to contend that the assessee had duly discharged the burden cast upon it under section 68 of the Act. She further referred to the remand report placed in the paper book on paper book page 435-437and submitted that the Assessing Officer had examined the documentary evidence during the remand proceedings. According to her, once such verification had already been undertaken, the ld. CIT(A) ought to have adjudicated the issues on merits instead of restoring the matter to the Assessing Officer. It was accordingly submitted that the additions deserved to be deleted on merits.

4.2 Per contra, the learned Departmental Representative supported the orders of the authorities below. He submitted that the assessee neither complied with the statutory notices issued during the reassessment proceedings nor furnished the return of income in response to the notice issued under section 148 of the Act. He

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submitted that on receipt of notice u/s 148 the assessee was required to file return of income and thereafter the assessee could have asked for the copy of the reasons recorded from the AO. He submitted that assessee neither filed return of income nor complied during the course of the reassessment proceedings which laid to the reassessment passed as best judgment assessment passed u/s 144 of the Act. According to him, now assessee cannot take a plea that no reasons were provided and therefore the reassessment proceeding should be held invalid. Consequently, the Assessing Officer was justified in completing the assessment under section 144 of the Act on the basis of the material available on record. The Ld. DR submitted that there is no reference of any remand report in the impugned order of the LD. CIT(A) and therefore no cognizance can be taken of the said remand report for adjudicating the issue in dispute on merit.

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for passing a fresh assessment after affording due opportunity of hearing to the assessee.

5.1 We shall first deal with the challenge to the assumption of jurisdiction under sections 147/148 of the Act. The principal contention of the learned Authorised Representative is that the reassessment proceedings are founded merely on borrowed satisfaction and that the reasons recorded for reopening were never supplied to the assessee. It has also been argued that the issues relating to share capital and share premium had already been examined during the original assessment completed under section 143(3) of the Act and, therefore, the reopening is nothing but a mere change of opinion.

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appellate authority, no contemporaneous material has been produced evidencing that such a request had been made and declined by the Assessing Officer.

5.3 It is well settled that although an assessee is entitled to seek the reasons recorded for reopening and to raise objections thereto, the grievance regarding non-supply of reasons has to be examined in the factual backdrop of each case. In the present case, the assessee chose not to participate in the reassessment proceedings and did not even file the return of income in response to the notice issued under section 148 of the Act. Having failed to avail the statutory opportunity available during the reassessment proceedings, the assessee cannot, in the peculiar facts of the present case, seek to invalidate the reassessment solely on the plea that the reasons recorded were not furnished. In the absence of any material establishing that such reasons were demanded and their supply was refused by the Assessing Officer, we find no merit in the legal challenge raised by the assessee. Accordingly, the grounds challenging the validity of the reassessment proceedings do not merit acceptance.

5.4 We shall now advert to the grievance of the assessee against the decision of the ld. CIT(A) restoring the matter to the file of the Assessing Officer instead of adjudicating the additions on merits. It is an admitted position that the reassessment order was framed ex- parte under section 144 of the Act owing to non-compliance on the

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part of the assessee during the reassessment proceedings. Consequently, the Assessing Officer had no occasion to examine the documentary evidence now relied upon by the assessee in support of the share capital, share premium and investment transactions.

5.5 Before us, the learned Counsel of the assessee has placed considerable reliance upon a remand report allegedly obtained by the ld. CIT(A) and the documentary evidence stated to have been produced before the Assessing Officer during such remand proceedings. However, on a careful examination of the impugned appellate order, we find that there is no discussion whatsoever regarding the filing of any application for admission of additional evidence, the exercise of powers by the ld. CIT(A) in admitting such evidence, or the consideration of any remand report while adjudicating the appeal. The appellate order is equally silent as to the nature of the documents allegedly produced before the Assessing Officer during the remand proceedings and the findings recorded thereon. In these circumstances, it would neither be appropriate nor permissible for this Tribunal to adjudicate the correctness of the additions on the basis of documents which have not been examined or discussed in the impugned appellate order.

5.6 We also find no infirmity in the approach adopted by the ld. CIT(A) in directing the Assessing Officer to undertake a fresh examination of the issues after granting adequate opportunity to the assessee. The assessment under challenge admittedly stood

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completed under section 144 of the Act without effective participation of the assessee. The additions under section 68 as well as the addition towards alleged commission income involve examination of voluminous documentary evidence relating to the identity of the investors, their creditworthiness, the genuineness of the transactions and the nature of the investments reflected in the books of account. These are essentially questions of fact requiring proper verification by the Assessing Officer. The course adopted by the ld. CIT(A), therefore, ensures that the factual issues are examined comprehensively on the basis of complete evidence after affording reasonable opportunity to both parties. Such a direction advances the cause of substantive justice and cannot be said to have caused any prejudice to the assessee, particularly when the assessee shall have full liberty to produce all documentary evidence in support of its case before the Assessing Officer.

5.7 The apprehension expressed by the learned Authorised Representative that the ld. CIT(A) ought to have himself decided the additions on merits also does not persuade us to interfere with the impugned order. Once the matter has been restored for fresh adjudication after granting adequate opportunity, all factual as well as legal contentions available to the assessee remain open. The assessee shall be at liberty to produce all documentary evidence in support of its claim, to raise every legal objection available under law, including those relating to the additions made under section

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68 and the estimated commission income, and the Assessing Officer shall consider the same objectively and in accordance with law, uninfluenced by any observations contained in the original reassessment order.

5.8 In view of the foregoing discussion, we are of the considered opinion that the assessee has failed to demonstrate any legal or factual infirmity in the impugned order warranting interference by this Tribunal. We, therefore, uphold the order of the ld. CIT(A). Consequently, all the grounds raised by the assessee stand dismissed.

Order pronounced in the open Court on 29/07/2026.

Sd/- Sd/- (PAWAN SINGH) (OM PRAKASH KANT) JUDICIAL MEMBER ACCOUNTANT MEMBER

Mumbai; Dated: 29/07/2026 M. Ranganath Vittal , Sr. P.S.

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Copy of the Order forwarded to :

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