KARAN TUSHAR PAREKH,MUMBAI vs. INCOME TAX OFFICER - CIRCLE 27(2), MUMBAI, NAVI MUMBAI

IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH MUMBAI BEFORE SHRI CHALLA NAGENDRA PRASAD, VICE PRESIDENT & SHRI MAKARAND VASANT MAHADEOKAR, ACCOUNTANT MEMBER ITA No. 4029/Mum/2026 (Assessment Year: 2020-21) Karan Tushar Parekh ITO Circle 27(2) Flat No. 901, 9th Floor, IT Office, Vashi Railway Vs. Nellai Heights, Swastik Station Building, Park, Chembur, Mumbai, Navi Mumbai - Mumbai-400 071 400 703 PAN/GIR No. BWPPP4038R (Applicant) (Respondent) Assessee by Shri Bhavesh Shah (virtually appeared), Ld. AR Revenue by Shree Kumar C., Ld. DR Date of Hearing 02.07.2026 Date of Pronouncement 07.07.2026 आदेश / ORDER PER MAKARAND VASANT MAHADEOKAR, AM: This appeal by the assessee is directed against the order dated 11.02.2026 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 2020-21. The impugned appellate order arises

2 ITA No. 4029/Mum/2026 Karan Tushar Parekh from the assessment order dated 17.02.2025 passed by the Assessing Officer under section 147 read with sections 144 and 144B of the Act.

3 ITA No. 4029/Mum/2026 Karan Tushar Parekh The addition of Rs. 9,34,269/- based on stamp duty valuation is incorrect and made without giving an opportunity to justify valuation differences. 7. Ignoring Submitted Evidence: The Assessing Officer erred in ignoring submissions made on 15.10.2024 and 07.12.2024, including financial statements and GST records. 8. Assessment Beyond Jurisdiction: The case was reopened for specific reasons (bogus purchases), however additions were made on multiple unrelated issues, which is beyond the scope of reopening. 9. Best Judgment Assessment Improper: The assessment under section 144 was made arbitrarily without proper inquiry or verification. 10. Prayer for Remand: The Appellant prays that the matter be restored to the file of the Assessing Officer for fresh adjudication after considering all evidences. 11. General Ground: The Appellant craves leave to add, alter, amend or withdraw any of the above grounds at the time of hearing. Facts of the case

4 ITA No. 4029/Mum/2026 Karan Tushar Parekh 11,21,640/- from M/s Nikhil Trading Company without actual movement of goods. 4. An order under section 148A(d) of the Act was passed on 23.03.2024, followed by issuance of notice under section 148 on the same date. The assessee filed his return in response thereto on 15.10.2024, declaring the same income. During the reassessment proceedings, notices and reminders were issued calling for books of account and supporting evidence. The assessee furnished certain documents, including the tax audit report, computation of income, Form No. 16 and GST return, but the Assessing Officer found the compliance insufficient. 5. The Assessing Officer, therefore, completed the assessment by order dated 17.02.2025 under section 147 read with sections 144 and 144B of the Act, determining the total income at Rs. 1,26,35,009/-, after making additions of Rs. 11,21,640/- on account of alleged bogus purchases, Rs. 97,00,000/- under section 69 as unexplained investment and Rs. 9,34,269/- as income from other sources. Penalty proceedings under sections 270A and 271AAC(1) were also initiated. 6. Aggrieved, the assessee filed an appeal before the learned CIT(A). The learned CIT(A) issued several notices of hearing, including a final opportunity fixing compliance on 04.02.2026. As there was no compliance and no written submissions or supporting evidence were furnished, the learned CIT(A) proceeded on the basis of the material available on record and upheld the

5 ITA No. 4029/Mum/2026 Karan Tushar Parekh additions made by the Assessing Officer. The appeal was accordingly dismissed by order dated 11.02.2026 passed under section 250 of the Act. 7. Before us, the learned Authorised Representative (AR) submitted that the Assessing Officer had issued notices under section 142(1) of the Act and subsequent reminders requiring the assessee to produce his books of account and supporting documentary evidence. It was submitted that the assessee had left India on 17.07.2024 for pursuing higher studies and, during the relevant period, had limited access to his records and electronic communications. According to the learned AR, this circumstance resulted in delayed and partial compliance with the notices issued by the Assessing Officer. 8. The learned AR further submitted that, upon becoming aware of the reassessment proceedings, the assessee filed his return of income in response to the notice issued under section 148 of the Act on 15.10.2024. The assessee also furnished partial details, including the financial statements, tax audit report and GST returns. Further submissions were stated to have been made on 07.12.2024 along with a request for adjournment for furnishing the remaining documents. 9. It was submitted that, notwithstanding the compliance made by the assessee, the Assessing Officer proceeded to complete the assessment under section 147 read with sections

6 ITA No. 4029/Mum/2026 Karan Tushar Parekh 144 and 144B of the Act on 17.02.2025 and made additions aggregating to Rs. 1,17,55,909/-. 10. The learned AR submitted that the appeal before the learned CIT(A) was dismissed ex parte due to non-representation and without an effective adjudication of the disputed issues on their individual merits. It was contended that the learned CIT(A) had dismissed the appeal substantially on account of non-prosecution without properly considering the material already available on record and without granting an effective opportunity to the assessee. 11. The learned AR, therefore, prayed that the impugned appellate order be set aside and the matter be restored to the file of the learned CIT(A) for fresh adjudication after granting the assessee an adequate and effective opportunity of hearing. 12. The learned Departmental Representative relied upon the orders passed by the Assessing Officer and the learned CIT(A). He, however, did not raise any objection to the matter being restored to the file of the learned CIT(A) for fresh adjudication. 13. We have considered the rival submissions and perused the material available on record. It is evident that the assessment was completed substantially on the basis of the material available with the Assessing Officer, in the absence of complete supporting evidence from the assessee. It is equally evident that the appeal before the learned CIT(A) was disposed of in the absence of any representation or written submissions from the assessee.

7 ITA No. 4029/Mum/2026 Karan Tushar Parekh 14. The learned CIT(A), in the impugned order, recorded that the assessee had failed to comply with the notices issued during the appellate proceedings and had not furnished documentary evidence in support of the grounds raised. The learned CIT(A), therefore, declined to interfere with the assessment order and dismissed the appeal. 15. The first appellate proceedings constitute a valuable statutory remedy available to an assessee. The learned CIT(A), while disposing of the appeal, is required to examine the issues arising from the assessment order and adjudicate the grounds raised by the assessee by passing a reasoned order on the basis of the material available on record and such further material as may lawfully be brought before him. 16. In the present case, the assessee has explained that he had left India on 17.07.2024 for pursuing higher studies and had limited access to his records and communications. It is also apparent from the assessment order that the assessee had filed the return of income in response to notice under section 148 on 15.10.2024 and had furnished certain documents, including the tax audit report, computation of income, financial statements and GST return. The record also refers to further compliance on 07.12.2024. Thus, this is not a case of complete absence of participation at the assessment stage. 17. The additions involved are substantial and concern distinct issues relating to the genuineness of purchases, the source of

8 ITA No. 4029/Mum/2026 Karan Tushar Parekh investment in an immovable property and the application of section 56(2)(x) of the Act. These issues require examination of the relevant documentary evidence and an adjudication on their individual merits. The jurisdictional grounds challenging the reopening of the assessment also require proper consideration. 18. Considering the totality of the facts, the explanation furnished on behalf of the assessee and the fair stand taken by the learned Departmental Representative, we are of the considered view that the assessee should be granted one more effective opportunity to present his case before the learned CIT(A). Such restoration would advance the cause of substantive justice without causing any prejudice to the Revenue. 19. We, therefore, set aside the order dated 11.02.2026 passed by the learned CIT(A) under section 250 of the Act and restore the entire appeal, including the jurisdictional grounds as well as the grounds on merits, to the file of the learned CIT(A) for fresh adjudication in accordance with law. 20. The learned CIT(A) shall grant an adequate and effective opportunity of hearing to the assessee and shall consider the written submissions and supporting documentary evidence that may be furnished by him. The learned CIT(A) shall thereafter pass a speaking order dealing with each of the grounds raised by the assessee in accordance with law. 21. The assessee is also directed to cooperate with the appellate proceedings, comply with the notices issued by the learned CIT(A)

9 ITA No. 4029/Mum/2026 Karan Tushar Parekh and furnish the requisite submissions and evidence within the time allowed. The assessee shall not seek unnecessary adjournments. In the event of failure to cooperate, the learned CIT(A) shall be at liberty to adjudicate the appeal on the basis of the material available on record after granting due opportunity.

Order pronounced in the open court on 07.07.2026.

Sd/- Sd/- (CHALLA NAGENDRA PRASAD) (MAKARAND VASANT MAHADEOKAR) JUDICIAL MEMBER ACCOUNTANT MEMBER Mumbai, Dated 07/07/2026 Dhananjay, Sr.PS आदेश की प्रतितिति अग्रेतिि/Copy of the Order forwarded to : अपीलाथी / The Appellant 1. प्रत्यथी / The Respondent. 2. 3. संबंधधत आयकर आयुक्त / The CIT(A) 4. आयकर आयुक्त(अपील) / Concerned CIT धिभागीय प्रधतधनधध, आयकर अपीलीय अधधकरण, मुम्बई / DR, ITAT, Mumbai 5. गार्ड फाईल / Guard file. 6. आदेशानुसार/ BY ORDER, सत्याधपत प्रधत //True Copy// 1. उि/सहायक िंजीकार ( Asst. Registrar) आयकर अिीिीय अतिकरण, मुम्बई / ITAT, Mumbai