STERLING GREEN POWER SOLUTIONS PVT LTD,MUMBAI vs. ASSISTANT COMMISSIONER OF INCOME TAX 1(3)(1), MUMBAI

IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH MUMBAI BEFORE SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER & SHRI MAKARAND VASANT MAHADEOKAR, ACCOUNTANT MEMBER ITA No. 4148/Mum/2026 (Assessment Year: 2018-19) Sterling Green Power ACIT-1(3)(1) Solutions Pvt. Ltd. 5th Floor, Aayakar 10th Floor, Universal Vs. Bhavan, M. K. Road, Majestic, P. L. Mumbai-400 020 Lokhande Marg, Chembur, Mumbai- 400 043 PAN/GIR No. AACCS2107H (Applicant) (Respondent) Assessee by Shri H. Jamshedji, Ld. AR Revenue by Shree Kumar C., Ld. DR Date of Hearing 16.06.2026 Date of Pronouncement 18.06.2026 आदेश / ORDER PER MAKARAND VASANT MAHADEOKAR, AM: This appeal has been filed by the assessee against the order dated 25.09.2025 passed by the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, [hereinafter referred to as "CIT(A)"]under section 250 of the Income Tax Act, 1961[hereinafter referred to as "the Act"], for Assessment Year

2 ITA No. 4148/Mum/2026 Sterling Green Power Solutions Pvt. Ltd. 2018-19 arising out of the assessment order dated 25.03.2021 passed under section 143(3) of the Income Tax Act, 1961 by the National e-Assessment Centre, Delhi[hereinafter referred to as "Assessing Officer"]. 2. The assessee has raised various grounds challenging the action of the lower authorities in sustaining the additions made in the assessment proceedings. The primary grievance of the assessee before us is that the learned CIT(A) disposed of the appeal ex parte without granting effective opportunity of hearing and without independently adjudicating the issues raised in appeal. 3. Briefly stated, the facts of the case are that the assessee company filed its return of income for Assessment Year 2018-19 on 30.11.2018 declaring total income at Rs. Nil after set off of brought forward losses. The case was selected for scrutiny assessment through CASS. Notices under sections 143(2) and 142(1) of the Act were issued and complied with from time to time. The assessment was completed by the National e- Assessment Centre under section 143(3) vide order dated 25.03.2021 determining the total income at Rs.20,75,144/-. 4. During the assessment proceedings, the Assessing Officer observed that the assessee had claimed deduction of Rs.31,50,900/- under the head “Any other amount allowable as deduction”. According to the Assessing Officer, while an amount of Rs.10,95,518/- represented write back of provision for foreseeable losses disallowed in Assessment Year 2017-18, no

3 ITA No. 4148/Mum/2026 Sterling Green Power Solutions Pvt. Ltd. details or supporting evidence were furnished in respect of the balance amount of Rs.20,55,382/-. The Assessing Officer, therefore, disallowed the said amount and added the same to the income of the assessee. 5. The Assessing Officer further observed that as per Export Import data received from CBEC, the assessee had received duty drawback of Rs.19,762/- during the relevant previous year. Since the said amount was not credited to the Profit and Loss Account, the Assessing Officer treated the same as income of the assessee and made an addition of Rs.19,762/-. 6. Aggrieved by the assessment order, the assessee preferred an appeal before the learned CIT(A). The assessee challenged the additions and also contended that adequate opportunity was not granted during the assessment proceedings. The assessee further submitted detailed explanations regarding the claim of deduction comprising interest on retention money, gratuity paid and other items forming part of the amount claimed under the head “Any other amount allowable as deduction”. 7. The learned CIT(A) issued notices through the NFAC portal on various dates. As recorded in the impugned appellate order, according to the learned CIT(A), except seeking adjournment on one occasion, the assessee did not respond to the notices issued during the appellate proceedings. The learned CIT(A), therefore, proceeded to dispose of the appeal on the basis of material available on record.

4 ITA No. 4148/Mum/2026 Sterling Green Power Solutions Pvt. Ltd. 8. While adjudicating the appeal, the learned CIT(A) confirmed the addition of Rs.20,55,382/- holding that the assessee had failed to furnish documentary evidence to substantiate the claim of deduction and had also not responded to the notices issued during the appellate proceedings. The addition of Rs.19,762/- on account of duty drawback was also confirmed on the ground that the assessee had not produced any material to controvert the findings recorded by the Assessing Officer. However, the learned CIT(A) directed verification regarding the assessee's claim of TDS credit and set off of brought forward business losses, if found correct.

5 ITA No. 4148/Mum/2026 Sterling Green Power Solutions Pvt. Ltd. order. The learned AR contended that the notices issued during the appellate proceedings were never received by the assessee and, therefore, the assessee could not effectively represent its case before the learned CIT(A). It was contended that though detailed grounds of appeal and statement of facts were filed before the learned CIT(A), the appellate authority has not independently examined the issues on merits and has merely reproduced the assessment order and affirmed the findings of the Assessing Officer. It was further submitted that the learned CIT(A) has not recorded independent findings on the specific contentions raised by the assessee in relation to the claim of deduction and duty drawback addition. The learned AR, therefore, requested that one more opportunity be granted to the assessee and the matter be restored to the file of the learned CIT(A) for fresh adjudication in accordance with law. 11. The learned Departmental Representative fairly submitted that she has no objection if the matter is restored to the file of the learned CIT(A) for fresh adjudication after affording reasonable opportunity of hearing to the assessee. 12. We have considered the rival submissions and perused the material available on record. From the submissions made before us, it emerges that the notices issued during the appellate proceedings were not received by the assessee and, consequently, the assessee could not effectively represent its case before the learned CIT(A). We further note that the learned CIT(A) proceeded to dispose of the appeal in the absence of any effective

6 ITA No. 4148/Mum/2026 Sterling Green Power Solutions Pvt. Ltd. representation from the assessee. On a perusal of the impugned order, we find that substantial portions thereof comprise reproduction of the assessment order, grounds of appeal and statement of facts filed by the assessee. We also find that while sustaining the additions made by the Assessing Officer, the learned CIT(A) has not independently examined the explanations and evidences furnished by the assessee in support of its claim regarding the disallowance of Rs.20,55,382/- and the addition of duty drawback amounting to Rs.19,762/-. In our considered opinion, the first appellate authority, being the final fact-finding authority under the Act, is required to adjudicate the issues raised before him by passing a reasoned and speaking order after affording adequate opportunity of hearing and after duly considering the material placed on record. 13. Having regard to the totality of the facts and circumstances of the case, particularly the fact that the assessee could not participate in the appellate proceedings as the notices were not received by it, and considering the fair stand taken by the learned Departmental Representative, we are of the view that the ends of justice would be met by restoring the matter to the file of the learned CIT(A) for fresh adjudication. 14. Accordingly, we set aside the impugned order passed by the learned CIT(A) and restore the entire matter to his file with a direction to adjudicate the appeal afresh in accordance with law after providing adequate and effective opportunity of being heard to the assessee. The learned CIT(A) shall consider all contentions,

7 ITA No. 4148/Mum/2026 Sterling Green Power Solutions Pvt. Ltd. evidences and submissions that may be placed before him and shall pass a speaking order dealing with each of the grounds raised by the assessee. The assessee shall also extend due cooperation and promptly furnish such details and evidences as may be called for during the course of the appellate proceedings.

Order pronounced in the open court on 18.06.2026.

Sd/- Sd/- (CHALLA NAGENDRA PRASAD) (MAKARAND VASANT MAHADEOKAR) JUDICIAL MEMBER ACCOUNTANT MEMBER Mumbai, Dated 18/06/2026 Dhananjay, Sr.PS आदेश की प्रतितिति अग्रेतिि/Copy of the Order forwarded to : अपीलाथी / The Appellant 1. 2. प्रत्यथी / The Respondent. 3. संबंधधत आयकर आयुक्त / The CIT(A) 4. आयकर आयुक्त(अपील) / Concerned CIT धिभागीय प्रधतधनधध, आयकर अपीलीय अधधकरण, मुम्बई / DR, ITAT, Mumbai 5. गार्ड फाईल / Guard file. 6. आदेशानुसार/ BY ORDER, सत्याधपत प्रधत //True Copy// 1. उि/सहायक िंजीकार ( Asst. Registrar) आयकर अिीिीय अतिकरण, मुम्बई / ITAT, Mumbai