SHRI MAHENDRA HANSRAJ GANDHI,MUMBAI vs. THE ITO WARD 30(2)(3), MUMBAI

आयकरअपीलीयअिधकरण�ायपीठमुंबईम�। IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, MUMBAI BEFORE SHRI NARENDER KUMAR CHOUDHRY, JM & SHRI ARUN KHODPIA, AM I.T.A. No.6141/Mum/2025 (Assessment Year: 2010-11) Shri Mahendra Hansraj The Income tax Officer 30(2)(3) Gandhi Kautilya Bhavan, BKC Bandra – C/O. G.P. Mehta & Co. CAS, Vs. (East), Mumbai-400051 807, Tulsiani Chambers, Nariman Point, Mumbai-400021 PAN:AAAPG8896J Assessee- अपीलाथ� / Appellant Revenue-��थ�/ Respondent :

Assesseeby : Shri G. P. Mehta : Shri Kiran K. Chhatrapati – Revenueby Sr. DR : 21.04.2026 Date of Hearing Date of Pronouncement : 08.06.2026

O R D E R Per Arun Khodpia, AM: This appeal is preferred by the assessee, directed against the order of the Commissioner of Income Tax Appeals – ADDL/JCIT (A)-2, Chennai [in short, “the Ld. CIT(A)”], dated 25.08.2025 for the assessment year 2010-11, arises from the assessment order under section 143(3) r.w.s 147 of the Income Tax Act, 1961 [in short,“the Act”] dated 29.03.2016, passed byIncome Tax Officer – 30(2)(3), Mumbai [in short, “the Ld.AO”]. The grounds of appeal raised by the assessee, are as under:

ITA No. 6141/Mum/2025 Shri Mahendra Hansraj Gandhi “1 Orders passed by the learned lower authorities are bad in law and bad in facts. 2 The learned Addl / JCIT (A) has grossly erred in passing ex-parte appellate order, without rejecting the adjournment request filed by the appellant and without dealing with the grounds of appeal. 3 The notice issued u/s 148 of the I. T. Act, 1961, and consequent assesment order are void ab-initio, inasmuch as, no reason were provided to the appellant prior to completion of the assessment. 4 Theassessment order passed by the learned Assessing Officer is ab-initio void, inasmuch as, no notice u/s 143 (2) of the I. T. Act, 1961, was issued prior to completion of assesssment u/s 143 (3) of the I. T. Act, 1961. 5 The assessment order passed by the learned Assessing Officer is ab-initio void, inasmuch as, no opportunity was granted to cross examine the party, based on whose testimony the belief of purpoted escapement of income was formed. Consequently, the impugned order is a total nullity for want of observance of principal of natural justice. 6 The learned Assessing Officer has grossly erred in considering Rs.41,53,225/- under the head "income from other sources" as 6 against the said amount returned under the head "business income" and has further erred in disallowing the set-off of brought forward unabsorbed business loss to that extent. 7 The learned Assessing Officer has grossly erred in considering Rs.41,53,225/- under the head "income from other sources" instead of "business income" without bringing any material or 7 evidence on record to support his assertions and without independently examining all the persons involved in alleged client code modification. AlsoAssesing officer has no power to change the head of income in the return of income filed. 8 The learned Assessing Officer has grossly erred in making an addition of Rs.41,53,225/- as " income from other sources" instead of " business income" by merely twisting the facts contained in a statement supposedly recorded on 23.01.2015 referred to in the assessment order, without granting an opportunity of being heared before drawing adverse inferances. 9 Having regard to the facts of the case, provisions of law, judicial 9 propositions and material available on record, the addition of Rs. 41,53,225/-under the head "Income from Other Sources" is wholly unteanable in law.”

ITA No. 6141/Mum/2025 Shri Mahendra Hansraj Gandhi beneficiary in client code modification, fetching therefrom an income of ₹41,53,225/-, which has escaped assessment in the assessment year 2010-11. During the reopening assessment proceedings, the assessee was unable to furnish necessary information or details before the AO, accordingly,the assessment was completed on the basis of material available on the record, with an addition of Rs 41,53,225/- on account of bogus F&O profit obtained by the assessee. 3. An appeal was preferred before the Ld. CIT(A). The appeal of assessee was dismissed in limine on account of delay and non-prosecution, while the assesseehad not furnished nay petition for condonation or submissions, despite being afforded with nine (9) opportunities starting from 11/01/2019 up to 27/06/2025. 4. Before us, Ld. AR of the assessee has submitted a written note regarding reasons for non-compliance before the authorities below, same is culled out as under: “Appellant Shri Mahendra Hansraj Gandhi has filed an appeal against the ex-parte order passed by the learned Addl / JCIT (A) 2, Chennai, even though an adjournment request was made on each date of appointment. The appellant, due to death of his parents and wife in a short span went into depression and was not in a mental state to look after his tax

Date of Death: Shri Hansraj Sonraj Gandhi Father 03.07.2015 Smt. Madhu Mahendra Gandhi Wife 03.07.2015 Smt. Pista Devi Mother 13.10.2018 Besides death of close family members, appellant's Chartered Accountant who is a senior citizen also suffered from health issues from time to time as detailed below:

ITA No. 6141/Mum/2025 Shri Mahendra Hansraj Gandhi Date of admission: Name of the Hospital Reason 09.11.2017 to 12.11.2017 Nanavati Hospital Stroke

25.04.2019 to 06.05.2019 SIM Institute for Medical Open heart Surgery Science Chennai

Continuous medication for uncontrolled Hyper Tension, Uncontrolled Dmz, Peri Pheral Vertigo, Cervical Spondylosis and Hyperkalemia. Above stated sicknesses is an ongoing problem and has effectively reduced the efficiency level hence timely submission could not be filed. There is no delay in filing of appeal before CIT (A) and appeal was filed in physical mode on 29.04.2016 and appeal filing fees was paid on 26.04.2016. There is no deliberate default for non-filing of submissions, inasmuch as; the appellant had nothing to gain by non-participation in appellate proceedings. It is therefore, requested that a lenient view in the matter may please be taken and oblige. The appellant prays for justice.” 5. On perusal of aforesaid written submissions along with death certificates, it is evident that the assessee was going through a bad phase, wherein his father, wife and mother were passed away. Also, the Chartered Account of the assessee had under gone a heart surgery, who was looking after the tax matters of the assessee. It is prayed by the Ld. AR on behalf of the assessee, to restore the matter back to the file of ld. AO, wherein the assessee shall furnish all the necessary submissions and evidence for a fair assessment as per law. 6. Per contra, ld. Sr. DR supported the orders of revenue authorities, but had not objected to the request of assessee for remanding the matter back for fresh adjudication.

ITA No. 6141/Mum/2025 Shri Mahendra Hansraj Gandhi 7. After hearing the parties carefully, on perusal of the orders of revenue authorities and submissions of the assessee, considering the circumstantial difficulties with the assessee under which the compliance could not be made before the authorities below. Without delving into the merits of issue, we deem it appropriate, to accept the prayer of assessee to restore the matter back to the file of Ld. AO and we direct to do so. 8. Needless to say, the assessee shall be provided with reasonable opportunities of being heard in the set aside proceedings. The assessee is also directed to co-operate and pro-actively assist in the set aside proceedings, failing which the appellate authority would be at liberty to decide the appeal in accordance with the mandate of law. 9. The appeal of assessee, accordingly allowed for statistical purposes. In above terms. Order pronounced in the open court on 08-06-2026.

Sd/- Sd/- (NARENDER KUMAR CHOUDHRY) (ARUN KHODPIA) JUDICIAL MEMBER ACCOUNTANT MEMBER Mumbai, Dated : 08-06-2026. Ankit K., Sr. PS

ITA No. 6141/Mum/2025 Shri Mahendra Hansraj Gandhi

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

BY ORDER,

(Dy./Asstt. Registrar) ITAT, Mumbai