BHARATI CHANDRAHAS KARAJGI,MUMBAI vs. INCOME TAX OFFICER WARD 42(2)(1), MUMBAI, MUMBAI

PDF · subscribers
ITA 1068/MUM/2026Status: DisposedITAT Mumbai08 June 2026AY 2020-214 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the penalties cannot survive as the additions on which they were based have been set aside for de novo adjudication. Therefore, the penalty orders are set aside, and fresh proceedings can be initiated if warranted after the fresh assessment.

What were the facts?

The assessee failed to offer salary income and disclose the source of financial product purchases. The Assessing Officer reopened the assessment and made additions ex-parte due to non-compliance. Penalties under Sections 270A and 271AAC were imposed.

What were the issues?

Whether penalties under Sections 270A and 271AAC can be sustained when the underlying additions to income have been set aside for fresh adjudication.

Which sections of the Income-tax Act were involved?

Section 270A,Section 271AAC(1),Section 147,Section 148,Section 142(1),Section 144

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “B” BENCH, MUMBAI

Before: SHRI SAKTIJIT DEY & SHRI PRABHASH SHANKAR

For Appellant: Shri Mohit Makhija, (Virtually
For Respondent: Shri Swapnil Choudhary, Sr. DR
Hearing: 20.04.2026Pronounced: 08.06.2026

IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH, MUMBAI BEFORE SHRI SAKTIJIT DEY, VICE PRESIDENT AND SHRI PRABHASH SHANKAR, ACCOUNTANT MEMBER

ITA No.1068 & 1069/Mum/2026 (Assessment Year: 2020-21) Bharati Chandrahas Karajgi, Income Tax Officer (Int-Tax)- C2404, Mahindra Splendour, LBS Ward - 42(2)1, Vs. Marg, Bhandup West, Mumbai - 400051 Mumbai 400078 (Appellant) : (Respondent) PAN: AWPPK 9320E Appellant by : Shri Mohit Makhija, (Virtually President) Respondent by : Shri Swapnil Choudhary, Sr. DR

Date of Hearing : 20.04.2026 Date of Pronouncement : 08.06.2026 O R D E R Per Saktijit Dey, Vice President:

Present appeals, by the assessee, arise out of two separate orders, both dated 28.11.2025, passed by National Faceless Appeal Center (NFAC), Delhi confirming the penalty imposed under Sections 270A and 271AAC(1) of the Income Tax Act 1961 (in short “the Act”), pertaining to Assessment Year 2020- 21.

2.

We have considered rival submissions and perused the materials on record. Briefly stated, assessee is a resident individual. Based on information available on record, the Assessing Officer found that in the financial year

2 ITA No. 1068/Mum/2026 Bharati Chandrahas Karajgi

relevant to assessment year under dispute, the assessee had received the following income: (i) Salary income Rs. 35,31,094/- (ii) Purchase of financial products Rs. 46,80,000/-. Whereas, the assessee had neither offered the salary income nor furnished the source of purchase of financial products. Therefore, the Assessing Officer reopened the assessment under Section 147 of the Act by issuing notice under section 148 of the Act. As observed by the Assessing Officer, neither the assessee responded to the notice under Section 148 of the Act nor he furnished any reply/details in response to other statutory notices issued under section 142(1) of the Act. Due to non-compliance by the assessee, the Assessing Officer issued a show cause notice expressing his intention to complete the assessment to the best of his judgment by invoking the provisions of Section 144 of the Act. Since, the assessee did not comply to the said notice, as well, the Assessing Officer proceeded to complete the assessment ex-parte to the best of his judgment. While doing so, he added back an amount of Rs.81,51,094/- to the income of the assessee.

3.

Against the assessment order so passed, the assessee preferred appeal before learned First Appellate Authority. During the pendency of the appeals before the First Appellate Authority, the Assessing Officer not only initiated proceedings for imposition of penalty under Section 270A and 271AAC of the

3 ITA No. 1068/Mum/2026 Bharati Chandrahas Karajgi

Act, but also passed orders imposing penalty under the aforesaid provisions. The assessee filed appeals challenging the imposition of penalty.

4.

Insofar as the quantum appeal is concerned, learned First Appellate Authority dismissed the appeal on the ground of delay. Due to dismissal of the quantum appeal, the First Appellate Authority dismissed the appeals filed against the imposition of penalty. Learned counsel appearing for the assessee has submitted before us that against the dismissal of the quantum appeal, the assessee had preferred an appeal before the Income Tax Appellate Tribunal (ITAT). It was submitted, while disposing of the said appeal in ITA No. 292/Mum/2026, the Tribunal vide order dated 7-4-2026, had set aside the order of learned First Appellate Authority and restored the issues relating to the additions made to the file of the Assessing Officer for de novo adjudication, in accordance with law, after providing reasonable opportunity of being heard to the assessee.

5.

Learned Departmental Representative (DR) could not controvert the aforesaid fact.

6.

Having considered rival submissions, we are of the view that the penalties imposed under Sections 270A and 271AAC of the Act cannot survive as on date as the additions based on which penalties were imposed have been set aside to the Assessing Officer for fresh consideration. Thus, as of now, there

4 ITA No. 1068/Mum/2026 Bharati Chandrahas Karajgi

is no subsisting addition in case of the assessee, so as to sustain the penalty imposed by the Assessing Officer. Accordingly, we set aside the impugned orders of the First Appellate Authority as also the Assessing Officer imposing penalty under Section 270A and 271AAC of the Act. The Assessing Officer may initiate penalty proceedings afresh, if so warranted, depending upon the outcome of the fresh assessment in pursuance of the directions of the ITAT. Grounds are allowed for statistical purpose.

7.

In the result, appeals are allowed for statistical purposes.

Order pronounced in the open court on 08/06/2026.

Sd/- Sd/- (Prabhash Shankar) (Saktijit Dey) Accountant Member Vice President Mumbai; Dated : 08/06/2026 Aks/-

Copy of the Order forwarded to : 1. The Appellant 2. The Respondent 3. The CIT(A) 4. CIT - concerned 5. DR, ITAT, Mumbai 6. Guard File BY ORDER,

(Dy./Asstt. Registrar)

More judgments on Section 270A

All 4,156 judgments and leading authorities on Section 270A →

Recent GST High Court judgments

Search GST case law →