BHANSALI AND CO ,MUMBAI vs. DCIT, CIRCLE 19(1), MUMBAI

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ITA 7463/MUM/2025Status: DisposedITAT Mumbai29 April 2026AY 2013-145 pages
AI SummaryRemanded

What did the Tribunal hold?

The tribunal decided that judicial consistency must be maintained due to identical facts in both assessment years. The matter was restored to the AO to compare the facts and pass a fresh assessment order.

What were the facts?

The assessee challenged the reassessment order and additions made by the AO. The tribunal noted that reassessments for two assessment years were initiated on identical facts and audit objections, but resulted in different outcomes.

What were the issues?

The primary issues were the validity of the reassessment proceedings and the addition made based on alleged unaccounted income from 'shortage' in inventory, with a secondary issue of maintaining consistency between reassessments for different years.

Which sections of the Income-tax Act were involved?

Section 148,Section 148A,Section 151,Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “B” BENCH MUMBAI

For Appellant: Shri Apurva R.Shah
For Respondent: Shri Swapnil Choudhari (SR. DR
Hearing: 26.03.2026Pronounced: 29.04.2026

IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH MUMBAI BEFORE HON’BLE SHRI SANDEEP GOSAIN, JUDICIAL MEMBER & HON’BLE SHRI JAGADISH, ACCOUNTANT MEMBER ITA No. 7463/Mum/2025 (Assessment Year: 2013-14)

Bhansali & Co Vs. DCIT, Circle 19(1), EE 7010, Bharat Diamond Mumbai Bourse, BKC, Bandra (East), DCIT, Circle 19(1), Mumbai - 400051 Mumbai, Piramal Chambers, Dr SS Rao Marg, Parel, Mumbai - 400012 PAN/GIR No. AACFB8643C (Applicant) (Respondent) Assessee by Shri Apurva R.Shah Revenue by Shri Swapnil Choudhari (SR. DR. Date of Hearing 26.03.2026 Date of Pronouncement 29.04.2026 आदेश / ORDER PER SANDEEP GOSAIN, JM: The present appeal has been filed by the assessee challenging the impugned order dated 17.10.2025 passed u/s 250 of the Income Tax Act, 1961 (‘the Act’), by the National Faceless Appeal Centre, Delhi (NFAC) for the assessment year 2018-19. The following grounds are reproduced below:

2 ITA No. 7463/Mum/2025

“Grounds of Appeal The NFAC has erred as under: 1. In summarily rejecting all grounds related to reassessment and holding that the reassessment was valid. More specifically, in upholding the reassessment despite the following errors by the AO: 2. in making a reassessment of already assessed income without any new information being available and in a manner that was beyond its jurisdiction. 3. in serving the notice u/s 148 to the personal email ID of an ex-employee. 4. in not mentioning a DIN on the notice issued u/s 148 and then communicating the DIN only later and in not selecting any information on the notice as being the reason for reassessment. 5. In issuing a Notice u/s 148A(b) with the sanction of the Pr. CIT when more than 3 years had elapsed since the end of the relevant assessment year. 6. in not appreciating that when the notice was issued u/s 148A, there was no income that was represented by any assets and hence could not have been re-opened. 7. in not providing any Information as needed u/s 148A(b) other than just the approval u/s 151 to the assessee. 8. in re-opening a completed assessment without any information on the INSIGHT Portal and hence mostly based only on some audit objection and merely based on a change of opinion on a completed assessment which was beyond the powers conferred u/s 148. Without prejudice to the above: The NFAC erred in not considering the detailed submissions made and in upholding the addition made by the AO. In particular: 9. in assuming that the caratage shown in the Tax Audit Report under the template head SHORTAGE represented inventory that was sold outside the books, without any further evidence to support the same, and hence adding a sum of Rs. 1,64,28,712 as unaccounted income based on merely presumptions and surmises.

3 ITA No. 7463/Mum/2025

10.

in not appreciating that the shortage was a normal loss in the course of the regular manufacturing activity of the appellant that were being done since decades and the entire process of which was explained in detail. 11. Without prejudice, in computing estimated sale price based on a simple average of the sale price for the year. ”

2.

At the very outset, the Ld. AR appearing on behalf of the assessee submitted that the show cause notice dated 13.04.2023 was not received by the assessee at all, and this fact has already been confirmed at page no. 7, para no. 4 of the assessment order. Since the Revenue has failed to comply with the requirement of statutory notices, it was also brought on record that reassessment for two assessment years, i.e., the year under consideration (AY 2013–14) and AY 2014–15, was simultaneously initiated by the Faceless Assessment Unit on identical facts. However, the reassessment order for AY 2014–15 dated 24.05.2023 is now being filed to demonstrate that, under identical facts, no additions were made by the AO.

3.

After hearing the counsels for both parties on this factual issue, we noticed from the record that reassessments for both AY 2013–14 and AY 2014–15 were initiated on an identical set of facts and based on identical audit objections. The reasons recorded were also identical. However, no additions were made in the reassessment order for AY 2014–15 vide order dated 24.05.2023, whereas for the year under consideration, additions were made vide assessment order dated 15.03.2023.

4 ITA No. 7463/Mum/2025

4.

Be that as it may, without going into the merits of the grounds raised by the assessee, the Bench is of the view that since both reassessments were proposed on the same set of facts, judicial consistency must be maintained. Accordingly, the order dated 24.05.2023 passed by the AO needs to be re-examined in light of the assessment order dated 15.03.2023 for AY 2013–14.

5.

Therefore, we are of the view that the matter should be restored to the file of the AO to consider and compare the facts of both assessment years and thereafter pass a fresh assessment order, particularly since the reassessment order for AY 2014–15 dated 24.05.2023 was not available with the AO at the time of passing the reassessment order for the year under consideration.

6.

Needless to mention that the AO shall provide adequate opportunity of hearing to the assessee. The assessee shall not seek any adjournment on frivolous grounds and shall remain cooperative during the course of proceedings.

7.

In the result, the appeal filed by the assesse stands allowed for statistical purposes.

Order pronounced in the open court on 29.04.2026 Sd/- Sd/- (JAGADISH) (SANDEEP GOSAIN) JUDICIAL MEMBER ACCOUNTANT MEMBER

5 ITA No. 7463/Mum/2025

Mumbai, Dated 29/04/2026 RY, Sr. PS आदेश की प्रतितिति अग्रेतिि/Copy of the Order forwarded to : अपीलार्थी / The Appellant 1. प्रत्यर्थी / The Respondent. 2. संबंधित आयकर आयुक्त / The CIT(A) 3. आयकर आयुक्त(अपील) / Concerned CIT 4. धिभागीय प्रधतधिधि, आयकर अपीलीय अधिकरण,मुम्बई/ DR, ITAT, Mumbai 5. 6. गार्ड फाईल / Guard file. आदेशानुसार/BY ORDER, सत्याधपत प्रधत //True Copy//

उि/सहायक िंजीकार ( Asst. Registrar) आयकर अिीिीय अतिकरण, मुम्बई / ITAT, Mumbai

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