SHRI RAJESH NARENDRA KUMAR JAIN ,MUMBAI vs. INCOME TAX OFFICER WARD 23(3)(6), MUMBAI

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ITA 254/MUM/2026Status: DisposedITAT Mumbai30 April 2026AY 2012-134 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal condoned the delay in filing the appeal. The Tribunal found that the CIT(A) had not dealt with all grounds due to the assessee's non-compliance and decided to remand the issue back for fresh adjudication.

What were the facts?

The assessee's case was reopened based on information about share trading in VMS Industries Ltd. The Assessing Officer made additions for share trading and commission. The assessee's appeal before the CIT(A) was dismissed ex-parte due to non-compliance.

What were the issues?

Whether the assessment order and notices were void due to jurisdictional issues and lack of proper communication. Whether the additions made by the AO were justified and if business losses could be set off.

Which sections of the Income-tax Act were involved?

Section 148,Section 143(3),Section 147,Section 68,Section 69C,Section 127(2),Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “H (SMC

Before: AND SHRI MAKARAND VASANT MAHADEOKAR, AM Shri Rajesh Narendra Kumar

For Appellant: Shri G. P. Mehta, AR
For Respondent: Shri Pravin Salunkhe, Sr. DR
Pronounced: 30.04.2026

IN THE INCOME TAX APPELLATE TRIBUNAL “H (SMC)” BENCH, MUMBAI BEFORE MS. KAVITHA RAJAGOPAL, JM AND SHRI MAKARAND VASANT MAHADEOKAR, AM ITA No.254/Mum/2026 (Assessment Year: 2012-13)

Shri Rajesh Narendra Kumar Income Tax Officer, Jain, Ward 23(3)(6) C/O G.P Mehta & Co. CAS, Earnest House, 6th Floor, Vs. 807, Tulsiani Chambers, Nariman Point, Nariman Point, Mumbai-400021 Mumbai-400021 PAN: ACVPJ0061B (Appellant) : (Respondent)

Assessee by : Shri G. P. Mehta, AR Respondent by : Shri Pravin Salunkhe, Sr. DR

: 29.04.2026 Date of Hearing Date of Pronouncement : 30.04.2026

O R D E R Per Kavitha Rajagopal, JM:

This appeal is filed by the assessee challenging the order of the Learned Commissioner of Income Tax (Appeals), ADDL/JCIT (A)-4, Bengaluru [“Ld. CIT(A)” for short] passed u/s 250 of the Income Tax Act, 1961 (“the Act” for short) relevant to assessment year (“AY” for short) 2012-13.

2.

It is observed that the present appeal is filed belatedly with a delay of 12 days, for which the assessee had filed an affidavit along with an application for condoning the said delay. On perusal of the same and on hearing the rival contentions, we deem it fit to

condone the delay as there being “sufficient cause” explained by the assessee for the delay in filing the appeal beyond the period of limitation. Accordingly, the delay is condoned.

ITA No.254/Mum/2026 Shri Rajesh Narendra Kumar Jain

3.

The assessee has raised the following grounds of appeal:

“1. Orders passed by the learned lower authorities are bad in law and bad in facts.

2.

Notice issued under section 148 of the I.T. Act, 1961, is ab-initio void, inasmuch as, same was issued by a non-jurisdictional Assessing Officer (ITO - 18(3) (1). Consequently, the assessment order passed in pursuance of said notice is also ab-initio void.

3.

Notice issued under section 148 of the I.T. Act, 1961, is ab-initio void, inasmuch as, material based on which belief of escapement of income was formed, was not made a part of the notice under section 148 of the Act, and served upon the appellant.

4.

The Assessment order passed is ab-initio void, inasmuch as no reasons/order u/s 127 (2) of the I.T. Act, 1961, were communicated to the appellant prior to transfer of case from ITO 18 (3) (1) Mumbai to ITO 23 (3) (6) Mumbai.

5.

The Assessing Officer has grossly erred in ignoring returned business loss at Rs.39,62,378/- arising out of share trading and, she has further erred in not allowing set-off of current year's loss against the income assessed for the same year. Reasons assigned for impugned disallowance are in contradiction to the provisions of the Act.

6.

The learned Assessing Officer has grossly erred in not appreciating the fact that the shares of VMS Industries Ltd. were purchased by the appellant at Bombay Stock Exchange and not in connivance with a private party. Thus the whole theory of impugned addition is based purely on imagination & conjectures.

7.

The learned Assessing Officer has grossly erred in not appreciating the fact that the shares of VMS Industries Ltd. were purchased by the appellant at Bombay Stock Exchange and not in connivance with a private party. Thus the whole theory of impugned addition is based purely on imagination & conjectures.

8.

Having regard to the facts of the case, provisions of law and judicial propositions, impugned addition of Rs.3,27,071/- is wholly uncalled for and unteanable.

9.

The appellant may please be permitted to raise any additional or alternative ground on or before hearing of the appeal.” 2

ITA No.254/Mum/2026 Shri Rajesh Narendra Kumar Jain 4. Brief facts of the case are that the assessee is an individual and had not filed his

return of income for the year under consideration. Pursuant to the search and seizure action

carried on by the investigating wing on Shri Naresh Jain and his associates dated

19.03.2019, the assessee’s case was reopened on the basis of tangible material that the

assessee had traded in shares of M/s. VMS Industries Ltd. amounting to Rs.3,27,071/-

alleged to be a penny stock. The Ld. Assessing Officer (“Ld. AO” for short) then passed

the assessment order dated 24/12/2019 u/s 143(3) r.w.s. 147 of the Act determining the

total income at Rs.3,33,610/- after making an addition/disallowance u/s 68 of the Act

amounting to Rs.3,27,071/- and Rs.6,541/- as commission expenditure u/s 69C of the Act.

5.

Aggrieved, the assessee was in appeal before the first appellate authority who vide

an ex-parte order dated 30.10.2025 dismissed the appeal filed by the assessee on the ground

that the assessee has been non-compliant to during the first appellate proceeding.

6.

Aggrieved, the assessee is in appeal before us challenging the order of the Ld.

CIT(A).

7.

We have heard the rival submissions and perused the materials available on record.

The assessee is said to have raised various grounds both legal as well as on the merits

before the first appellate authority and the same were dismissed by the Ld. CIT(A) on the

ground that the assessee has not filed any written submission nor has he filed any

supporting documentary evidences to prove that the transaction was genuine. It is also

observed that the Ld. CIT(A) has not dealt with all the grounds raised by the assessee for

the reason that the assessee has not complied with the notices issued by the Ld. CIT(A) nor

ITA No.254/Mum/2026 Shri Rajesh Narendra Kumar Jain has he filed any written submission in support of his contention. In order to extend the

assessee with one more opportunity, we deem it fit to remand the issue back to the file of

the Ld. CIT(A) for the denovo adjudication on the direction that the assessee should

cooperate with the proceeding before the first appellate authority without any undue delay

from his side. The Ld. CIT(A) is directed to decide all the grounds of appeal raised by the

assessee on the merits and in accordance with law.

8.

In the result, the appeal filed by the assessee is allowed for statistical purpose.

Order pronounced in the open court on 30.04.2026

Sd/- Sd/- (MAKARAND VASANT MAHADEOKAR) (KAVITHA RAJAGOPAL) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai; Dated: 30.04.2026 * Kishore, Sr. P.S. Copy of the Order forwarded to: 1. The Appellant 2. The Respondent 3. CIT- concerned 4. DR, ITAT, Mumbai 5. Guard File BY ORDER,

(Dy./Asstt.Registrar) ITAT, Mumbai

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