KALPANARANI PANDA,MUMBAI vs. THE INCOME TAX OFFICER, WARD 27(2)(1), MUMBAI, NAVI MUMBAI

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

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

ITA No. 2229/MUM/2026 Assessment Year: 2018-19

Smt. Kalpanarani Panda, 44 The Income Tax Officer, Ward Mussoorie, Anushaktinagar, 27(2)(1), IT-Office, Vashi Railway Trombay, Mumbai – 400094, Vs. Station Building, Navi Mumbai – Maharashtra. 400705, Maharashtra. PAN NO. AOPPP 3568 M Appellant Respondent

: Ms. Ekta Thanvi, Adv. Assessee by : Ms. Jayshree Thakur (SR DR) Revenue by

: 30/06/2026 Date of Hearing : 30/06/2026 Date of pronouncement ORDER PER OM PRAKASH KANT, AM

This appeal by the assessee is directed against the order dated 15.01.2026, 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’), 2018-19, raising the following grounds:-

“1. On the facts and circumstances of the case, and in law, the Ld. AO has erred in continuing the reopened proceedings that were initiated without adhering to

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the prescribed u/s.151A of the Act, read with the procedures scheme notified by the Central Government through Notification dated 29.03.2022. 2. On the facts and circumstances of the case, and in law, the Ld. AO has erred in ignoring the binding precedent set by the decision of the Hon’ble Bombay High Court in the case of Hexaware Technologies Ltd. v. ACIT as reported in (2024) 162 taxmann.com 225 (Bom)(HC). 3. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in the facts and circumstances of the case and in law in confirming the stand of the Ld. AO in invoking provisions of section 69A of the Act when the same were not applicable. 4. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in the facts and circumstances of the case and in law in confirming the addition made by the Ld. AO of a sum of Rs.8,66,800/- being alleged unexplained difference in the purchase of immovable property. 5. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in the facts and circumstances of the case and in law in not appreciating the fact that the said property was funded fully out of the funds of Husband of the Appellant, with her merely being joint holder for future security purposes.” 2. Briefly stated, the facts of the case are that the assessee did not file her return of income for the year under consideration. Based on information available with the Assessing Officer through the information system, it was noticed that the assessee, along with her husband, had purchased an immovable property for a total consideration of ₹1,12,33,600/- during the relevant previous year. On the basis of the said information, the Assessing Officer formed a belief that income chargeable to tax had escaped assessment and accordingly initiated reassessment proceedings under section 147 of the Income-tax Act, 1961 ("the Act") by issuing notice under section 148 after obtaining the requisite approval from the competent authority. In response thereto, the assessee filed her return of income declaring Nil income.

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2.1 During the course of the reassessment proceedings, the assessee explained that although her name appeared as a co-owner in the registered sale deed, the property had, in fact, been purchased entirely out of the funds of her husband and that she had been included as a joint owner only for reasons of future financial security. It was further contended that the entire sale consideration had been paid by her husband and that no investment whatsoever had been made by the assessee. The Assessing Officer, however, was not persuaded by the explanation so offered. The assessing officer found that home loan of Rs.95 lakhs was taken by her husband for purchase of property and other payment was made but source of amount of Rs. ₹8,66,800/-, was explained. Holding that the assessee had failed to satisfactorily explain the source of investment attributable to her share in the property, the Assessing Officer invoked the provisions of section 69A of the Act and made an addition of ₹8,66,800/-.

2.2 Aggrieved by the assessment order, the assessee preferred an appeal before the learned CIT(A). The learned CIT(A), after considering the material available on record, affirmed the action of the Assessing Officer by holding, inter alia, that the assessee had failed to establish, by cogent documentary evidence, that the investment relatable to her ownership interest had been sourced exclusively from the funds of her husband. The appellate authority further observed that mere existence of a spousal relationship could

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not dispense with the statutory obligation cast upon the assessee to satisfactorily explain the source of investment. Consequently, the addition made under section 69A of the Act was sustained. The relevant finding of ld CIT(A) is reproduced as under:-

“6. The assessee stands as co-owner of the immovable property as per the registered sale deed corroborated by third-party SFT-0128 report reflecting purchase consideration of Rs. 1,12,33,600/- during the relevant previous year, while the equity share purchase of Rs. 3,686/- is evidenced through STT-01 data. Despite repeated statutory opportunities afforded vide notices under sections 142(1) dated 11.01.2023, 19.01.2023 and 06.07.2023, section 143(2) and the final show-cause notice dated 21.07.2023, the assessee failed to discharge the onus by establishing a direct financial nexus between her husband's declared income/savings and the specific investment attributable to her 50% share, with nb corresponding bank channel transfers traced to her accounts for the impugned amount of Rs. 8,66,800/- post proportionate loan adjustment of Rs. 47,50,000/-. The home loan of Rs. 95 lakhs, sanctioned exclusively in the husband's name, adequately covers only his co-owner's portion, leaving the assessee's balance unexplained. The documentary evidence tendered, while voluminous, remains deficient in probative linkage, rendering the explanation unsatisfactory within the contemplation of section 69A. This provision deems the value of any unrecorded 'money, bullion, jewellery or other valuable article expressly including investments in immovable property as interpreted judicially as the assessee's income for the year of ownership where no cogent source is furnished or proved bona fide by the Assessing Officer post inquiry. The addition, consequently taxed at concessional rates under section 115BBE along with interest under sections 234A and 234B and fee under section 234F, flows logically therefrom. Principles of natural justice stand fully complied with under the faceless assessment mechanism of section 144B, as all submissions were duly uploaded, examined and reasons recorded in the order for their rejection. The assessee's invocation of spousal relationship under section 2(41) or humane considerations cannot supplant the statutory mandate requiring verifiable source proof, particularly when opportunities for section 133(6) verification were available yet the primary onus under section 69A remains hers. 7. Hon'ble Supreme Court in CIT vs. P. Krishnamoorthy 309 ITR 263 (SC) has held that; The expression used in Section 69A(1) hot, in the opinion of the Assessing Officer, be satisfactory' makes it clear that the opinion is that of the Assessing Officer, and that such an opinion in order to escape the penal provision, must not only be rational but also one based on relevant material. The opinion of the Assessing Officer, therefore, is not to be lightly interfered with but once the AO records a satisfaction in that regard, it would not be open to any authority to challenge it.

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4.1 It was further submitted that the additional documents sought to be placed on record are directly relevant for proper adjudication of the controversy involved in the appeal and their production is essential for arriving at the correct factual conclusion. It was, therefore, prayed that the additional evidence be admitted in the interest of substantial justice.

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5.1 The explanation furnished by the assessee for non-production of these documents before the lower authorities appears to be bona fide. The assessee has explained that, being unrepresented before the first appellate authority and having no technical knowledge of taxation or appellate procedure, she was unable to effectively present her case and place all relevant material on record. In our considered opinion, the explanation constitutes sufficient cause for the earlier non-production of the documents. It is well settled that the object of Rule 29 of the Income-tax (Appellate Tribunal) Rules, 1963 is to enable the Tribunal to admit additional evidence where the same is necessary for rendering substantial justice or for enabling an effective adjudication of the controversy. The documents now sought to be produced have a direct bearing on the

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core issue involved in the appeal and go to the very root of the matter. Their examination is, therefore, indispensable for determining the real nature of the investment and the applicability of section 69A of the Act.

5.2 Having regard to the totality of the facts and circumstances, we are of the considered view that the additional evidence deserves to be admitted. Since the authenticity and evidentiary value of these documents require factual verification by the Assessing Officer, and as the lower authorities did not have the benefit of examining the same, we consider it appropriate, in the interest of fairness and in conformity with the principles of natural justice, to set aside the impugned order of the learned CIT(A) and restore the matter to the file of the Assessing Officer. The Assessing Officer shall examine the additional evidence as well as any other documentary material that may be produced by the assessee in support of her claim, conduct such enquiry as may be considered necessary, and thereafter decide the issue afresh by passing a reasoned and speaking order in accordance with law after affording the assessee an adequate opportunity of being heard. The assessee is also directed to extend full cooperation during the remand proceedings and to furnish all documents and explanations as may be required by the Assessing Officer. Needless to observe, the Assessing Officer shall decide the issue independently and uninfluenced by any observations contained in this order.

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Order pronounced in the open Court on /06/2026.

Sd/- Sd/- (ANIKESH BANERJEE) (OM PRAKASH KANT) JUDICIAL MEMBER ACCOUNTANT MEMBER Mumbai; Dated: 30/06/2026 M. Ranganath Vittal , Sr. P.S.

Copy of the Order forwarded to : 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file.

BY ORDER, //True Copy// (Assistant Registrar) ITAT, Mumbai