M/S. R.D CONSTRUCTION ,MUMBAI vs. DCIT, CENTRAL CIRCLE 6(4), MUMBAI

On the facts and circumstances of the case and in law, the Ld. A.O. has erred in issuing notice u/s 148 and completing the assessment and passing the order u/s 147 of the Income Tax Act, 1961 which is wholly unreasonable, invalid, illegal and bad in law. 4. On the facts and circumstances of the case and in law, the Ld. A.O. has erred by not conducting inquiry proceedings u/s 148A as well as assessment proceedings u/s 148 in faceless manner by FAO. The appellant relies on the decision of Hon'ble Bombay High Court in case of Hexaware Technologies Ltd vs. ACIT, [[2024] 162 taxmann.com 225 (Bombay)]. 5. On the facts and circumstances of the case and in law, the Ld. A.O has erred in adding of Rs. 55,00,000/- being accommodation entries of genuine loan transaction by treating the same as Unexplained credit u/s 68 of Income Tax Act, 1961 without consideration the facts and circumstances of the case. 6. On the facts and circumstances of the case and in law, the Ld. A.O. has erred by disallowing of Rs. 4,17,533/- being payment of interest on the accommodation entries of genuine loan transaction as unexplained expenditure incurred by the assessee u/s 69C of the Income Tax Act, 1961 without considering the facts and circumstances of the case. 7. On the facts and circumstances of the case and in law, the Ld. A.O, has erred in adding Rs. 2.75,000/- (5% of Rs. 55,00,000/-) being commission paid on accommodation entries of genuine loan transaction of the appellant by treating the same as unexplained expenditure incurred by the assessee u/s 69C of the Income Tax Act, 1961 without considering the submission and facts that the appellant has not paid any commission to any person for taking genuine loan from the alleged parties. 8. On the facts and circumstances of the case and in law, the Ld. A.O. has erred by not allowing the cross examination to the appellant with the alleged parties as asked by the appellant during the assessment proceedings vide letter dated 11/02/2025. 9. On the facts and circumstances of the case and in law, the Ld. A.O. has erred by making the disallowance in respect of genuine loan, interest on loan and estimated expenses on arranging the genuine loan amount without finding of any incriminating material related to addition so made at the time of survey from the premises of the appellant's group. 10. On the facts and circumstances of the case and in law, the Ld. A.O. has erred by solely relied upon the statement taken at the time of survey and at the time of search on third party ignoring the fact and submission of the appellant that statement on which the Ld. AO relied upon was already retracted by the concerned persons of the appellant group. No addition maintainable if made solely on the basis of statement recorded at the time of survey. The appellant relied upon the judgement given by the Hon'ble Kolkata ITAT in the matter of Rohitaswa Das vs. ACIT [ITA No. 1949/Kol/2017].” 3. Facts of the case, in brief, are that the assessee electronically filed return of income for the AY 2019-20 on 18.10.2019 declaring loss of Rs.15,18,414/-. The case was reopened vide issue of notice u/s 148 on 13.04.2023. During assessment proceedings, the assessee has made submissions on various dates. After hearing the assessee, the AO added Rs.55,00,000/- as unexplained cash credit u/s 68 of the Act, disallowed of Rs.4,17,533/- towards interest on accommodation entries and Rs.2,75,000/- u/s 69C of the Act. 4. Aggrieved by the order of AO, the assessee filed appeal before the CIT(A). The CIT(A) issued 3 notices u/s 250 of the Act to the assessee. However, the assessee did not filed any submission before the CIT(A). The CIT(A) observed that the appellant has not been able to refute the observations of the AO despite sufficient opportunity granted to the assessee. Hence, he dismissed the appeal for non-prosecution. 5. Aggrieved by the order of CIT(A), the assessee filed appeal before the Tribunal. AT the outset, the Ld. AR submitted that the order passed by the CIT(A) is in clear violation of the principles of natural justice. He submitted that the assessee has requested for adjournment of 30 days vide letter dated 08.12.2025. However, the CIT(A) did not grant any adjournment and pass the order within 7 days on 15.12.2025. The Ld. AR submitted that the assessee made the request for adjournment in order to compile necessary data and to prepare the submission.