SMITH AND NEPHEW HEALTHCARE PRIVATE LIMITED ,MUMBAI vs. ACIT TDS OSD CIRCLE 2(2), MUMBAI

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ITA 2127/MUM/2026Status: DisposedITAT Mumbai15 June 2026AY 2020-213 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal found that the First Appellate Authority issued a notice for the wrong assessment year and passed an order despite the appellant pointing out the discrepancy. Therefore, the appeal was restored to the First Appellate Authority.

What were the facts?

The assessee failed to deduct TDS amounting to Rs. 6,07,018, leading to them being declared an 'assessee in default'. The First Appellate Authority dismissed the appeal due to non-prosecution, relying on the Tax Audit Report.

What were the issues?

Whether the principles of natural justice were violated due to a mistaken notice from the appellate authority and if the appeal should be restored for proper consideration.

Which sections of the Income-tax Act were involved?

Section 201

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI BENCH “G”, MUMBAI

Before: JUSTICE (RETD.) C.V. BHADANG & SHRI PRABHASH SHANKAR

For Appellant: Shri Nikhil Tiwari
For Respondent: Shri Basavaraj Hiremath, CIT-DR
Hearing: 09/06/2026Pronounced: 15/06/2026

PER JUSTICE (RETD.) C.V. BHADANG, PRESIDENT :

This appeal by the assessee can be disposed of on a short count. The appeal relates to assessment year 2020-21.

2.

The Assistant Commissioner of Income Tax (OSD)(TDS), Circle 2(2), Mumbai (‘AO’ for short) found that the appellant had failed to deduct TDS and there was a default in that regard to the tune of Rs.6,07,018/-. The AO by an order dated 30.11.2023 has found appellant to be an “assessee in default” under Section 201 of the Income Tax Act, 1961 (‘Act’ for short) and had directed the assessee to pay the aforesaid amount alongwith interest of Rs.2,67,087/- totalling to Rs.8,74,105/-.

2 ITA No. 2127/Mum/2026 Smith & Nephew Healthcare Pvt. Ltd. 3. In appeal, the First Appellate Authority has noticed that the appellant’s conduct, both during the assessment proceedings (seeking adjournment and failing to file the required details) and even before the First Appellate Authority, is “a clear case of non-prosecution”. The First Appellate Authority has also noticed that the TDS default is determined by the AO based on the figures reported in the Tax Audit Report (Form 3CD) which remains unrebutted. In that view of the matter, the appeal came to be dismissed by an order dated 07.12.2025, which is subject matter of challenge herein.

4.

We have heard parties. Perused record.

5.

The learned AR submitted that the authorities below had failed to consider the request made by the appellant for time, which has resulted in violation of principles of natural justice. It is pointed out that a notice dated 07.08.2024 was issued by the Addl./Joint Commissioner of Income Tax (Appeals), Ranchi requiring the appellant to file ground-wise written submissions on or before 19.08.2024. It is pointed out that the notice indicated that it was in respect of an appeal for assessment year 2019-20. The appellant pointed out to the First Appellate Authority that the appellant had not filed any appeal for assessment year 2019-20 and, therefore, was unable to file any submissions relating to any such appeal. Inspite of this, the impugned order came to be passed. It is pointed out that the impugned order was passed on 07.12.2025, which was a Sunday. The learned AR submitted that the appeal may be restored back to the file of the First Appellate Authority.

6.

The learned DR has supported the impugned order.

7.

We have considered the submissions made. It does appear from the record that the notice dated 07.08.2024 was issued relating to an appeal for assessment year 2019-20, which the appellant claims not to have filed. The present appeal relates to

3 ITA No. 2127/Mum/2026 Smith & Nephew Healthcare Pvt. Ltd. assessment year 2020-21. Time was granted only till 19.08.2024 and the order came to be passed thereafter inspite of the fact that the appellant pointed out the said discrepancy. In the overall circumstances, we find that it would be appropriate if the appeal is restored back to the file of the First Appellate Authority.

8.

In the result, the present appeal is allowed for statistical purposes. The impugned order is set aside. The appeal filed by the appellant is restored back to the file of the First Appellate Authority for disposal according to law. Needless to mention, the appellant shall co-operate by furnishing the required information/documents, if any, for appropriate disposal of the appeal.

Order pronounced in the open court on 15.06.2026.

Sd/- Sd/- (PRABHASH SHANKAR) (JUSTICE (RETD.) C.V. BHADANG) ACCOUNTANT MEMBER PRESIDENT Mumbai; Dated : 15.06.2026 SSL

Copy of the Order forwarded to : 1. The Appellant 2. The Respondent 3. The PCIT/CIT concerned 4. DR, ITAT, Mumbai 5. Guard File. BY ORDER, //True Copy//

(Assistant Registrar) ITAT, Mumbai

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