NAV DURGA CONSTRUCTION COMPANY,VASHI, NAVI MUMBAI vs. INCOME TAX OFFICER CIRCLE 27(2), MUMBAI, VASHI, NAVI MUMBAI

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ITA 2721/MUM/2026Status: DisposedITAT Mumbai14 July 2026AY 2018-195 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal set aside the orders of both the CIT(A) and the Assessing Officer. The matter was restored to the Assessing Officer for fresh adjudication, allowing the assessee to furnish details and evidence.

What were the facts?

The assessee's appeal against the CIT(A)'s order was dismissed for non-compliance without adjudication on merits. The CIT(A) had dismissed the appeal as infructuous due to the assessee's failure to respond to hearing notices.

What were the issues?

Whether the CIT(A) erred in dismissing the appeal for non-compliance without examining the merits of the additions and disallowances made by the Assessing Officer.

Which sections of the Income-tax Act were involved?

Section 68,Section 69A,Section 194IA,Section 271AAC(1),Section 234F,Section 270A,Section 271A(1)(d),Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “B” BENCH MUMBAI

Before: SHRI SAKTIJIT DEY & SHRI MAKARAND VASANT MAHADEOKAR

For Appellant: Shri Nilesh Joshi
Hearing: 25.06.2026Pronounced: 14.07.2026

आदेश / ORDER PER MAKARAND VASANT MAHADEOKAR, AM: This appeal by the assessee is directed against the order dated 29.01.2026 passed by the learned Commissioner of Income- tax (Appeals), National Faceless Appeal Centre, Delhi [“CIT(A)”], under section 250 of the Income-tax Act, 1961 [“the Act”], for the assessment year 2018-19. The impugned appellate order arises

3 ITA No. 2721/Mum/2026 Nav Durga Construction Company consideration on the basis of TDS payment under section 194IA of the act upheld by CIT(A). 8. The learned assessing officer has erred in making the addition of Rs.94,94,862/- being 12% of Unsecured loan of Rs.7,91,23,854/- under section 68 of Income Tax Act 1961, towards the disallowance of interest paid to the appellant own sister concern of Jai Mata Di Homes Construction Private Limited upheld by CIT(A). 9. The learned assessing officer has erred in making addition of Rs.1,78,469/- under section 68 of Income Tax Act 1961, towards disallowance of brought forward loss claimed by appellant upheld by CIT(A). 10. The learned assessing officer has erred in making the addition of Rs.2,25,718/- under section 68 of Income Tax Act 1961, towards disallowed expenditure claimed on account of interest on TDS under section 68 of the income tax act upheld by CIT(A). 11. The learned Assessing officer has erred in making the addition of Rs.24,31,318/- under section 68 of Income tax Act, 1961 towards the TDS claimed by the assessee deducted under section 194IA. 12. The learned assessing officer has erred in making the addition of Rs.53,20,000/-under section 69A of the Income Tax Act 1961, towards the cash deposited upheld by CIT(A). 13. The learned assessing officer has erred in initiating the penalty proceeding under section 271AAC(1) of the Income Tax Act1961 upheld by CIT(A). 14. The learned assessing officer has erred in initiating the penalty proceeding under section 234F of the Income Tax Act 1961 upheld by CIT(A). 15. The learned assessing officer has erred in initiating the penalty proceeding under section 270A of the Income Tax Act 1961 upheld by CIT(A). 16. The learned assessing officer has erred in initiating the penalty proceedings under section 271A(1)(d) of the income tax act 1961 upheld by CIT(A). 17. The appellant craves to add, amend and/or alter any of the foregoing grounds of this appeal as and when required. Facts of the Case

5 ITA No. 2721/Mum/2026 Nav Durga Construction Company Mata Di Home Construction Private Limited, brought-forward loss of Rs.1,78,469/-, interest on TDS of Rs.2,25,718/- and TDS credit of Rs.24,31,318/-. Cash deposits of Rs.53,20,000/- were treated as unexplained money under section 69A. Consequently, by assessment order dated 28.03.2024 passed under section 147 read with section 144B, the total income was determined at Rs.73,55,56,434/-. The Assessing Officer also initiated penalty proceedings under the relevant provisions of the Act.

6.

Aggrieved, the assessee preferred an appeal before the CIT(A), challenging the validity of the reassessment proceedings as well as the additions and disallowances on merits. The CIT(A) recorded that the assessee did not respond to the hearing notices dated 07.08.2025, 02.09.2025 and 09.09.2025. Accordingly, by order dated 29.01.2026 passed under section 250, the CIT(A) treated the appeal as infructuous and dismissed it for non-compliance, without recording any independent or issue-wise findings on merits.

7.

Further aggrieved by the order of CIT(A), the assessee is in appeal before us.

8.

Before us, the learned Authorised Representative (AR) submitted that the orders passed by both the Assessing Officer and the CIT(A) are ex parte. It was submitted that the Assessing Officer completed the reassessment and made substantial additions without the benefit of complete details and supporting evidence

7 ITA No. 2721/Mum/2026 Nav Durga Construction Company 07.08.2025, 02.09.2025 and 09.09.2025. Although the assessee had challenged the validity of the reassessment proceedings as well as each of the additions and disallowances made by the Assessing Officer, the CIT(A) did not adjudicate any of the grounds on merits. Instead, the appeal was treated as infructuous and dismissed for non-compliance.

12.

Thus, the merits of the additions and disallowances have not been examined by the CIT(A), and the assessment itself was completed without the benefit of complete details and supporting evidence from the assessee. Considering the totality of the facts, the substantial quantum of the additions, the ex parte nature of the proceedings before both the lower authorities and the concurrence of both the parties before us, we are of the considered view that the issues require fresh examination at the level of the Assessing Officer.

13.

Accordingly, in the interest of justice, we set aside the impugned order dated 29.01.2026 passed by the CIT(A) as well as the assessment order dated 28.03.2024 and restore the entire matter to the file of the Assessing Officer for fresh adjudication in accordance with law. The Assessing Officer shall provide the assessee with a reasonable and effective opportunity of being heard and shall permit the assessee to furnish the requisite details, explanations and supporting documentary evidence. The Assessing Officer shall examine the same and pass a speaking

9 ITA No. 2721/Mum/2026 Nav Durga Construction Company Mumbai, Dated 14/07/2026 PS आदेश की �ितिलिप अ�ेिषत/Copy of the Order forwarded to : अपीलाथ� / The Appellant 1. ��थ� / The Respondent. 2. संबंिधत आयकर आयु� / The CIT(A) 3. आयकर आयु�(अपील) / Concerned CIT 4. िवभागीय �ितिनिध, आयकर अपीलीय अिधकरण, मु�ई / DR, ITAT, Mumbai 5. गाड� फाईल / Guard file. 6. आदेशानुसार/ BY ORDER, स�ािपत �ित //True Copy// 1. उप/सहायक पंजीकार ( Asst. Registrar) आयकर अपीलीय अिधकरण, मु�ई / ITAT, Mumbai

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