SANKATHAPRASAD SHYAMRAJ RAJBHAR,MUMBAI vs. ITO, BANDRA MUMBAI

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “H (SMC)” MUMBAI

BEFORE SHRI OM PRAKASH KANT (ACCOUNTANT MEMBER) AND SHRI ANIKESH BANERJEE (JUDICIAL MEMBER)

ITA Nos. 1574/MUM/2026 Assessment Year: 2017-18

Sankathaprasad Shyamraj Rajbhar, Income Tax Officer, Vs. Sankathaprasad Shyamraj Rajbhar 8 42(3)(3), Bandra, Mumbai, Gauri Pannalal Prajapati Chawl, Shiv Mumbai – 400051, Maharashtra. Vallabh Road, NR Bapp Sitaram Mandir, Ashok Van, Dahisar East, Mumbai – 400068, Maharashtra. PAN NO. AEFPR 9264 Q APPELLANT RESPONDENT

Assessee by : NONE : Shri Pravin Salunkhe (Sr.DR) Department by : 15.04.2026 Date of Hearing Date of pronouncement : 20.04.2026 ORDER PER OM PRAKASH KANT, AM

This appeal by the assessee is directed against order dated 25.09.2025, passed by the Learned Commissioner of Income Tax Appeals – National Faceless Appeal Centre, Delhi [in short ‘the Ld. CIT(A)’] for Assessment Year (in short ‘A.Y’) 2017-18, arising following grounds: -

Sankathaprasad Shyamraj Rajbhar, Vs. Sankathaprasad Shyamraj Rajbhar 2 Income Tax Officer, ITA No. 1574/MUM/2026 ITA No.

“1. That the order passed by the learned Commissioner of Income That the order passed by the learned Commissioner of Income-tax That the order passed by the learned Commissioner of Income (Appeals) is bad in law, contrary to the facts on record, and liable to (Appeals) is bad in law, contrary to the facts on record, and liable to (Appeals) is bad in law, contrary to the facts on record, and liable to be set aside. 2. That the learned CIT(A) erred in confirm 2. That the learned CIT(A) erred in confirming the assessment framed ing the assessment framed under section 147 read with section 144 without granting the section 147 read with section 144 without granting the section 147 read with section 144 without granting the appellant an effective opportunity of being heard, thereby violating appellant an effective opportunity of being heard, thereby violating appellant an effective opportunity of being heard, thereby violating the principles of natural justice. the principles of natural justice. 3. That the learned CIT(A) failed to adjudicate the issues on merits 3. That the learned CIT(A) failed to adjudicate the issues on merits 3. That the learned CIT(A) failed to adjudicate the issues on merits and mechanically confirmed and mechanically confirmed the additions solely on the ground that the additions solely on the ground that documentary evidence was not filed before the Assessing Officer, documentary evidence was not filed before the Assessing Officer, documentary evidence was not filed before the Assessing Officer, despite the appellant having furnished explanations during appellate despite the appellant having furnished explanations during appellate despite the appellant having furnished explanations during appellate proceedings. 4. That the learned CIT(A) erred in law and on facts in confirming the 4. That the learned CIT(A) erred in law and on facts in confirming th 4. That the learned CIT(A) erred in law and on facts in confirming th disallowance of exemption claimed in respect of House Rent disallowance of exemption claimed in respect of House Rent disallowance of exemption claimed in respect of House Rent Allowance, without appreciating that the appellant was a salaried Allowance, without appreciating that the appellant was a salaried Allowance, without appreciating that the appellant was a salaried employee, the allowance was reflected in Form 16, and tax was employee, the allowance was reflected in Form 16, and tax was employee, the allowance was reflected in Form 16, and tax was deducted at source under section 192 by the employer. deducted at source under section 192 by the employer. deducted at source under section 192 by the employer. 5. That the learned CIT(A) erred in confirming the addition of earned CIT(A) erred in confirming the addition of earned CIT(A) erred in confirming the addition of ₹1,00,000 by treating the Provident Fund withdrawal/emp 1,00,000 by treating the Provident Fund withdrawal/employer 1,00,000 by treating the Provident Fund withdrawal/emp settlement as income from other sources, without examining the settlement as income from other sources, without examining the settlement as income from other sources, without examining the nature of the receipt, applicable exemptions, or the settled legal nature of the receipt, applicable exemptions, or the settled legal nature of the receipt, applicable exemptions, or the settled legal position that such receipts are not taxable under that head. uch receipts are not taxable under that head. uch receipts are not taxable under that head. 6. That the learned CIT(A) erred in sustaining the addition of interest 6. That the learned CIT(A) erred in sustaining the addition of interest 6. That the learned CIT(A) erred in sustaining the addition of interest income without granting the eligible statutory deduction and without income without granting the eligible statutory deduction and without income without granting the eligible statutory deduction and without appreciating that the interest was within the permissible exemption appreciating that the interest was within the permissible exemption appreciating that the interest was within the permissible exemption limits, rendering the addition imits, rendering the addition revenue-neutral and unsustainable. neutral and unsustainable. 7. That the learned CIT(A) erred in treating salary-related receipts 7. That the learned CIT(A) erred in treating salary 7. That the learned CIT(A) erred in treating salary such as leave encashment and refund of income such as leave encashment and refund of income-tax of earlier year tax of earlier year as income from other sources, without examining the true nature and as income from other sources, without examining the true as income from other sources, without examining the true character of the receipts and without correlating the same with character of the receipts and without correlating the same with character of the receipts and without correlating the same with employer records and statutory provisions. employer records and statutory provisions. 8. That the learned CIT(A) failed to appreciate that the appellant is a 8. That the learned CIT(A) failed to appreciate that the appellant is a 8. That the learned CIT(A) failed to appreciate that the appellant is a salaried taxpayer with income subjected to tax deduction at source, salaried taxpayer with income subjected to tax deduction at sourc salaried taxpayer with income subjected to tax deduction at sourc

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and that there was no concealment of income or furnishing of and that there was no concealment of income or furnishing of and that there was no concealment of income or furnishing of inaccurate particulars, and the additions arose solely due to inaccurate particulars, and the additions arose solely due to inaccurate particulars, and the additions arose solely due to procedural and technical lapses. procedural and technical lapses. 9. That the learned CIT(A) erred in not admitting and considering 9. That the learned CIT(A) erred in not admitting and considering 9. That the learned CIT(A) erred in not admitting and considering additional evidence which goes additional evidence which goes to the root of the matter, and which to the root of the matter, and which could not be filed earlier due to absence of effective personal hearing could not be filed earlier due to absence of effective personal hearing could not be filed earlier due to absence of effective personal hearing and limitations of the faceless proceedings. and limitations of the faceless proceedings. 10. That the appellant respectfully submits that in the appellant's 10. That the appellant respectfully submits that in the appellant's 10. That the appellant respectfully submits that in the appellant's own case for earlier assessment ye own case for earlier assessment year(s) involving identical facts and ar(s) involving identical facts and issues, the learned Commissioner of Income issues, the learned Commissioner of Income-tax (Appeals) had tax (Appeals) had restored the matter to the file of the Assessing Officer for fresh restored the matter to the file of the Assessing Officer for fresh restored the matter to the file of the Assessing Officer for fresh adjudication after considering documentary evidence, and the same adjudication after considering documentary evidence, and the same adjudication after considering documentary evidence, and the same approach deserves to be ad approach deserves to be adopted in the present year in the interest opted in the present year in the interest of consistency and fairness. of consistency and fairness. 11. That the appellant prays that the Hon'ble Tribunal be pleased to 11. That the appellant prays that the Hon'ble Tribunal be pleased to 11. That the appellant prays that the Hon'ble Tribunal be pleased to admit the additional evidence under Rule 29 of the Income-tax admit the additional evidence under Rule 29 of the Income admit the additional evidence under Rule 29 of the Income (Appellate Tribunal) Rules, 1963, and adjudicate the issues on merits (Appellate Tribunal) Rules, 1963, and adjudicate the i (Appellate Tribunal) Rules, 1963, and adjudicate the i or restore the matter to the file of the Assessing Officer with or restore the matter to the file of the Assessing Officer with or restore the matter to the file of the Assessing Officer with appropriate directions. appropriate directions. 12. That the appellant prays for deletion of all additions and for 12. That the appellant prays for deletion of all additions and for 12. That the appellant prays for deletion of all additions and for grant of consequential relief in respect of tax, interest and penalty. grant of consequential relief in respect of tax, interest and penalty. grant of consequential relief in respect of tax, interest and penalty. 13. That the appellant craves leave to add to, amend, alter or ppellant craves leave to add to, amend, alter or ppellant craves leave to add to, amend, alter or withdraw any of the above grounds at the time of hearing. withdraw any of the above grounds at the time of hearing. withdraw any of the above grounds at the time of hearing.

At the outset, it is observed that there is a delay of 76 days in 2. At the outset, it is observed that there is a delay of 76 days in At the outset, it is observed that there is a delay of 76 days in filing the present appeal. The assessee has explained that upon filing the present appeal. The assessee has explained that upon filing the present appeal. The assessee has explained that upon receipt of the impugned order, he approached his tax consultant; impugned order, he approached his tax consultant; impugned order, he approached his tax consultant; however, due to the consultant’s absence for a certain period, the however, due to the consultant’s absence for a certain period, the however, due to the consultant’s absence for a certain period, the appeal could not be filed within the prescribed limitation. Having appeal could not be filed within the prescribed limitation. appeal could not be filed within the prescribed limitation. considered the explanation and the material on record, we are considered the explanation and the material on record, we are considered the explanation and the material on record, we are

Sankathaprasad Shyamraj Rajbhar, Vs. Sankathaprasad Shyamraj Rajbhar 4 Income Tax Officer, ITA No. 1574/MUM/2026 ITA No.

satisfied that the delay was occasioned by a reasonable and bona that the delay was occasioned by a reasonable and bona that the delay was occasioned by a reasonable and bona fide cause. In the interest of substantial justice, the delay of 76 fide cause. In the interest of substantial justice, the delay of 76 fide cause. In the interest of substantial justice, the delay of 76 days is condoned, and the appeal is admitted for adjudication. days is condoned, and the appeal is admitted for adjudication. days is condoned, and the appeal is admitted for adjudication.

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read with section 144 of the Act read with section 144 of the Act on 18/04/2023 and assessed the and assessed the total income at ₹7,61,356/ 7,61,356/-.

“7. Findings & Decision: 7. Findings & Decision: In this case, the In this case, the appellant has taken one ground of appeal. This appellant has taken one ground of appeal. This ground of appeal is about completion of assessment u/s 147 r.w.s ground of appeal is about completion of assessment u/s 147 r.w.s ground of appeal is about completion of assessment u/s 147 r.w.s 144 and about merit of addition of Rs. 1,40,694/ 144 and about merit of addition of Rs. 1,40,694/- - by disallowance out of deduction u/s 80C & 10(13) of the Act without considering the out of deduction u/s 80C & 10(13) of the Act without considering the out of deduction u/s 80C & 10(13) of the Act without considering the exemption limit. The appellant has contended that the additions n limit. The appellant has contended that the additions n limit. The appellant has contended that the additions made by the Assessing Officer be deleted. made by the Assessing Officer be deleted.

Sankathaprasad Shyamraj Rajbhar, Vs. Sankathaprasad Shyamraj Rajbhar 6 Income Tax Officer, ITA No. 1574/MUM/2026 ITA No.

On perusal of records, it is seen that in this case, assessment was On perusal of records, it is seen that in this case, assessment was On perusal of records, it is seen that in this case, assessment was completed ex-parte as appellant did not submit complete explanation parte as appellant did not submit complete explanation parte as appellant did not submit complete explanation before the Assessing before the Assessing Officer. In absence of explanations by the Officer. In absence of explanations by the appellant, the assessment was completed ex appellant, the assessment was completed ex-parte at total income of parte at total income of Rs. 7,61,356/-, making additions of Rs. 35,400/ , making additions of Rs. 35,400/ , making additions of Rs. 35,400/- on account of difference in gross salary, of Rs 5,294/ difference in gross salary, of Rs 5,294/- on account of interest on account of interest income & Rs. 1,00 income & Rs. 1,00,000/- on account of credit entry in bank account, on account of credit entry in bank account, raising demand of Rs. 99,900/ raising demand of Rs. 99,900/-. During the appellate proceedings, the appellant has tried to rebut the During the appellate proceedings, the appellant has tried to rebut the During the appellate proceedings, the appellant has tried to rebut the finding of the Assessing Officer by submitting explanation on bank finding of the Assessing Officer by submitting explanation on bank finding of the Assessing Officer by submitting explanation on bank interest and RD interest being with interest and RD interest being within the exemption limit and deposit in the exemption limit and deposit in bank account from PF withdrawal and Rs. 35,400/- being gratuity in bank account from PF withdrawal and Rs. 35,400/ in bank account from PF withdrawal and Rs. 35,400/ / leave encashment. However, no documents have been submitted to / leave encashment. However, no documents have been submitted to / leave encashment. However, no documents have been submitted to substantiate its claim. substantiate its claim. Further, vide reply dated 21.09.2023, the appellant has submitted Further, vide reply dated 21.09.2023, the appellant has submitted Further, vide reply dated 21.09.2023, the appellant has submitted that "..... For the Assessment Year 2017 "..... For the Assessment Year 2017-18, refund of Rs. 18,470/ 18, refund of Rs. 18,470/- was issued to me wrongly. I have deposited back the refund amount in issued to me wrongly. I have deposited back the refund amount in issued to me wrongly. I have deposited back the refund amount in Government Government Government Account Account Account vide vide vide challan challan challan number number number 00137 00137 00137 dated dated dated 17.09.2025....." Accordingly, it is evident that the appellant has Accordingly, it is evident that the appellant has no explanation to no explanation to offer about the additions made by the Assessing Officer even during offer about the additions made by the Assessing Officer even during offer about the additions made by the Assessing Officer even during appellate proceedings. Accordingly, the additions made by the appellate proceedings. Accordingly, the additions made by the appellate proceedings. Accordingly, the additions made by the Assessing Officer are confirmed and these grounds of appeal are Assessing Officer are confirmed and these grounds of appeal are Assessing Officer are confirmed and these grounds of appeal are decided against the appellant decided against the appellant.” 5. Before none represented the assessee. ne represented the assessee. The appeal was heard The appeal was heard ex ex ex parte parte parte qua qua qua the the the assessee. assessee. assessee. The The The Learned Learned Learned Departmental Departmental Departmental Representative was heard, and the material available on record was Representative was heard, and the material available on record was Representative was heard, and the material available on record was carefully perused.

5.1 It is evident that the It is evident that the assessment as well as the first assessment as well as the first appellate order has proceeded substantially on account of non proceeded substantially on account of non-furnishing of proceeded substantially on account of non

Sankathaprasad Shyamraj Rajbhar, Vs. Sankathaprasad Shyamraj Rajbhar 7 Income Tax Officer, ITA No. 1574/MUM/2026 ITA No.

documentary evidence by the assessee. At the same time, the documentary evidence by the assessee. At the same time, the documentary evidence by the assessee. At the same time, the explanation offered by the assessee indicates that he is a salaried explanation offered by the assessee indicates that he is a salaried explanation offered by the assessee indicates that he is a salaried individual and lacked adequate opportunity and assistance in individual and lacked adequate opportunity and assis individual and lacked adequate opportunity and assis effectively presenting his case, particularly in the faceless effectively presenting his case, particularly in the faceless effectively presenting his case, particularly in the faceless proceedings. In our considered view, the principles of natural proceedings. In our considered view, the principles of natural proceedings. In our considered view, the principles of natural justice require that a litigant be afforded a fair and reasonable justice require that a litigant be afforded a fair and reasonable justice require that a litigant be afforded a fair and reasonable opportunity to substantiate his claims, especially when the opportunity to substantiate his claims, especially when opportunity to substantiate his claims, especially when additions additions additions pertain pertain pertain to to to routine routine routine salary salary salary components, components, components, statutory statutory statutory exemptions, and identifiable receipts such as provident fund exemptions, and identifiable receipts such as provident fund exemptions, and identifiable receipts such as provident fund withdrawals. The Learned CIT(A), instead of examining the withdrawals. The Learned CIT(A), instead of examining the withdrawals. The Learned CIT(A), instead of examining the explanations on merits or calling for necessary verification, has explanations on merits or calling for necessary verification, has explanations on merits or calling for necessary verification, has summarily confirmed the additions solely on account of absence of confirmed the additions solely on account of absence of confirmed the additions solely on account of absence of documentary evidence. Such an approach, in the facts of the documentary evidence. Such an approach, in the facts of the documentary evidence. Such an approach, in the facts of the present case, does not subserve the cause of justice. present case, does not subserve the cause of justice. present case, does not subserve the cause of justice.

5.2 Accordingly, in the interest of justice, we deem it appropriate Accordingly, in the interest of justice, we deem it appropriate Accordingly, in the interest of justice, we deem it appropriate to set aside the impugned order of the Learned CIT(A) on the issues impugned order of the Learned CIT(A) on the issues impugned order of the Learned CIT(A) on the issues under consideration and restore the matter to his file for fresh under consideration and restore the matter to his file for fresh under consideration and restore the matter to his file for fresh adjudication. The Learned CIT(A) shall afford adequate opportunity adjudication. The Learned CIT(A) shall afford adequate opportunity adjudication. The Learned CIT(A) shall afford adequate opportunity of being heard to the assessee and decide the issues afresh in of being heard to the assessee and decide the issues afresh in of being heard to the assessee and decide the issues afresh in accordance with law, after considering all relevant submissions and with law, after considering all relevant submissions and with law, after considering all relevant submissions and evidences that may be furnished. The assessee is also directed to evidences that may be furnished. The assessee is also directed to evidences that may be furnished. The assessee is also directed to cooperate in the proceedings and file all necessary documentary cooperate in the proceedings and file all necessary documentary cooperate in the proceedings and file all necessary documentary evidence in support of his claims, including but not limited to: (i) evidence in support of his claims, including but not limited to: (i) evidence in support of his claims, including but not limited to: (i) Evidence in support of HRA claim, (ii) Proof of provident fund Evidence in support of HRA claim, (ii) Proof of provident fund Evidence in support of HRA claim, (ii) Proof of provident fund

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withdrawal, and (iii) Details of interest income and eligible withdrawal, and (iii) Details of interest income and eligible withdrawal, and (iii) Details of interest income and eligible deductions.

Order pronounced in the open Court Order pronounced in the open Court on 20/04/2026. /04/2026.

Sd/- Sd/ Sd/- (ANIKESH BANERJEE) (ANIKESH BANERJEE (OM PRAKASH KANT OM PRAKASH KANT) JUDICIAL MEMBER JUDICIAL MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER Mumbai; Dated: 20/04/2026 M. Ranganath Vittal , Sr. P.S. M. Ranganath Vittal , Sr. P.S.

Copy of the Order forwarded to Copy of the Order forwarded to : 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file. BY ORDER, BY ORDER, //True Copy// (Assistant Registrar) (Assistant Registrar) ITAT, Mumbai ITAT, Mumbai