BABULAL NARAYANLAL MEHTA,MUMBAI vs. WARD 9(1)(1), MUMBAI

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ITA 4873/MUM/2026Status: DisposedITAT Mumbai13 July 20267 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal condoned the delay and set aside the CIT(A)'s order. The matter was restored to the CIT(A) for fresh adjudication, granting the assessee one final opportunity to present evidence.

What were the facts?

The assessee's appeal was delayed by 86 days due to issues with his tax consultant. The Assessing Officer made an addition of Rs. 16,87,000/- under section 69A for unexplained cash deposits. The CIT(A) dismissed the assessee's appeal for non-compliance.

What were the issues?

Whether the assessee was prevented by sufficient cause from appearing before the appellate authority and whether the addition under section 69A was made without proper adjudication due to non-compliance.

Which sections of the Income-tax Act were involved?

Section 69A,Section 115BBE,Section 250,Section 147,Section 143(3),Section 144B,Section 148A,Section 148,Section 142(1),Section 271AAC,Section 234B,Section 234C,Section 234D

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “H(SMC

Before: SHRI NARENDER KUMAR CHOUDHRY & SHRI MAKARAND VASANT MAHADEOKAR

For Appellant: Ms. Kruti Doshi, CA
For Respondent: Shri Pavin Salunkhe, Sr DR
Hearing: 10.07.2026Pronounced: 13.07.2026

IN THE INCOME TAX APPELLATE TRIBUNAL “H(SMC)” BENCH MUMBAI BEFORE SHRI NARENDER KUMAR CHOUDHRY, JUDICIAL MEMBER & SHRI MAKARAND VASANT MAHADEOKAR, ACCOUNTANT MEMBER

ITA No. 4873/Mum/2026 (Assessment Year: 2017-18) Babulal Narayanlal Mehta Ward 9(1)(1) 34/40, Nanubhai Desai Piramal Chamber Road, C.P. Tank Vs. Lower Parel Mumbai-400 004. Mumbai-400 013

PAN/GIR No. AABPJ4137E (Applicant) (Respondent)

Assessee by Ms. Kruti Doshi, CA Revenue by Shri Pavin Salunkhe, Sr DR

Date of Hearing 10.07.2026 Date of Pronouncement 13.07.2026 आदेश / ORDER PER MAKARAND VASANT MAHADEOKAR, AM: This appeal has been preferred by the assessee against the order dated 14.11.2025 passed by the learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi [hereinafter referred to as "the CIT(A)"], under section 250 of the Income-tax Act, 1961 [hereinafter referred to as "the Act"], for the assessment year 2017-18, arising from the assessment order dated 11.05.2023 passed by the Assessing Officer under section 147 read with sections 143(3) and 144B of the Act.

2 ITA No. 4873/Mum/2026 Babulal Nayayanlal Mehta Condonation of Delay 2. At the outset, the Registry has pointed out a delay of 86 days in filing the present appeal. The assessee has filed a petition for condonation of delay supported by a duly sworn affidavit explaining the reasons for the delay. It has been stated that the delay occurred due to bona fide circumstances beyond the control of the assessee, who had entrusted the conduct of the tax proceedings to his tax consultant and remained under the bona fide belief that the matter was being duly attended to. It has further been explained that the consultant could not take timely action due to unavoidable personal circumstances and the subsequent lapse came to the knowledge of the assessee only thereafter, whereupon he immediately engaged a new Chartered Accountant and filed the present appeal. The learned Departmental Representative (DR) fairly raised no objection to condonation of the delay. Having considered the explanation furnished in the condonation petition and the affidavit, we are satisfied that the assessee was prevented by sufficient cause from filing the appeal within the prescribed period. The explanation appears to be bona fide and there is nothing on record to suggest deliberate negligence or mala fide conduct. Accordingly, the delay of 86 days is condoned and the appeal is admitted for adjudication on merits.

3.

Briefly stated, the facts are that the assessee, an individual, filed his return of income for the assessment year 2017-18 on 02.11.2017 declaring total income of Rs.10,10,280/-. Information was received by the Assessing Officer from DCIT, Central Circle- 7(2), Mumbai, regarding cash deposits made during the

3 ITA No. 4873/Mum/2026 Babulal Nayayanlal Mehta demonetisation period in the bank account of the assessee's proprietary concern, M/s. Uttam Metal & Tubes, maintained with M/s Sahebrao Deshmukh Co-operative Bank Ltd. Based on the said information, proceedings under section 147 of the Act were initiated after issuance of notice under section 148A(b), followed by an order under section 148A(d), and notice under section 148 dated 26.07.2022. During the reassessment proceedings, the Assessing Officer issued notices under section 142(1) and a show cause notice. According to the Assessing Officer, the assessee did not furnish satisfactory details explaining the source of cash deposits amounting to Rs.16,87,000/-. Consequently, the Assessing Officer treated the said amount as unexplained money under section 69A read with section 115BBE of the Act and completed the assessment under section 147 read with sections 143(3) and 144B of the Act vide order dated 11.05.2023, determining the total income at Rs.26,97,280/-.

4.

Aggrieved by the assessment order, the assessee preferred an appeal before the learned CIT(A). The learned CIT(A), vide order dated 14.11.2025 passed under section 250 of the Act, observed that despite several opportunities granted during the appellate proceedings, the assessee failed to comply with the notices issued under section 250. Holding that the assessee had not discharged the burden cast upon him and finding no reason to interfere with the findings recorded by the Assessing Officer, the learned CIT(A) dismissed the appeal and confirmed the addition made by the Assessing Officer.

4 ITA No. 4873/Mum/2026 Babulal Nayayanlal Mehta 5. Aggrieved by the order of CIT(A), the assessee is in appeal before us raising following grounds of appeal: • That on the facts and in the circumstances of the case and in law, the learned Commissioner of Income Tax (Appeals) erred in passing the order under Section 250 of the Income Tax Act without providing adequate and effective opportunity of being heard, thereby violating the principles of natural justice. • That on the facts and in the circumstances of the case and in law, the learned CIT(A) erred in confirming the assessment framed under Section 144 of the Income Tax Act without appreciating that the same was passed ex-parte and without proper verification of facts. • That on facts and circumstances of the case and in law, the Ld Commissioner of Income Tax (Appeals) has erred is passing the order u/s 250 and confirming additions of Rs 16,87,000 u/s 69A rws 115BBE. • That on facts and circumstances of the case and in law, the Ld Commissioner of Income Tax (Appeals) has erred in initiating penalty proceedings u/s 271AAC. • That on facts and circumstances of the case and in law, the Ld Commissioner of Income Tax (Appeals) has erred in charging interest us 234B, 234C and 234D of the Income Tax Act. • That on facts and circumstances of the case and in law, the learned CIT(A) failed to appreciate that the appellant was prevented by sufficient cause from appearing and complying with the notices during the appellate proceedings. • That on facts and circumstances of the case and in law, the order passed by the learned CIT(A) is bad in law and liable to be set aside. • The appellant craves leave to add, amend, alter or withdraw any of the above grounds at the time of hearing. 6. Before us, the learned Authorised Representative (AR) reiterated the facts of the case in brief and submitted that the assessee could not effectively represent his case before the authorities below due to bona fide reasons explained in the affidavit filed along with the condonation petition. It was submitted that both the assessment order and the appellate order had been passed ex parte without effective representation by the assessee and, therefore, in the interest of substantial justice, one more

5 ITA No. 4873/Mum/2026 Babulal Nayayanlal Mehta opportunity may be granted to the assessee to place all relevant evidences before the appellate authority.

7.

The learned DR, on the other hand, invited our attention to the assessment order as well as the impugned appellate order and submitted that the assessee had remained consistently non- compliant before both the authorities below despite several statutory opportunities. He pointed out that both the orders came to be passed ex parte on account of the conduct of the assessee. However, the learned Departmental Representative fairly stated that he had no objection if the matter was restored to the file of the learned CIT(A) for fresh adjudication after affording adequate opportunity to the assessee.

8.

We have heard the rival submissions and perused the orders of the authorities below. It is evident from the record that the assessee remained non-compliant before both the Assessing Officer and the learned CIT(A) and failed to respond to the statutory notices issued from time to time. Consequently, both the authorities proceeded to decide the matter ex parte. Ordinarily, in such circumstances, we would not be inclined to interfere with the impugned order.

9.

However, the issue relating to the addition of Rs.16,87,000/- under section 69A read with section 115BBE of the Act has not been adjudicated in its proper perspective on the basis of complete submissions and supporting documentary evidence, as the same were not furnished by the assessee before the authorities below. The learned Departmental Representative has also fairly raised no

6 ITA No. 4873/Mum/2026 Babulal Nayayanlal Mehta objection to the matter being restored to the file of the learned CIT(A).

10.

Considering the peculiar facts and circumstances of the case in their entirety, and in the interest of substantial justice, we deem it appropriate to afford one final opportunity to the assessee to substantiate his case. Accordingly, the impugned order is set aside and the matter is restored to the file of the learned CIT(A) for fresh adjudication in accordance with law, after affording a reasonable and effective opportunity of being heard to the assessee, subject to payment of costs of Rs.11,000/- to be deposited with the Bombay High Court Legal Services Committee/Authority within 15 days from the date of this order.

11.

The assessee is directed to extend full cooperation in the appellate proceedings and to furnish all relevant submissions and documentary evidence without seeking unnecessary adjournments. We clarify that, in the event of any further default, the assessee shall not be entitled to any further leniency, and the learned CIT(A) shall be at liberty to decide the appeal in accordance with law on the basis of the material available on record. All issues are left open for adjudication.

12.

In the result, the appeal of the assessee is allowed for statistical purposes.

Order pronounced in the open court on 13.07.2026.

Sd/- Sd/- (NARENDER KUMAR CHOUDHRY) (MAKARAND VASANT MAHADEOKAR) JUDICIAL MEMBER ACCOUNTANT MEMBER

7 ITA No. 4873/Mum/2026 Babulal Nayayanlal Mehta

Mumbai, Dated 13/07/2026 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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