PUJYA SINDHI PANCHAYAT TRUST ,MUMBAI vs. ITO EXEMPTION WARD 18(3), MUMBAI

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ITA 1279/MUM/2026Status: DisposedITAT Mumbai25 September 2026AY 2018-196 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal found that the assessee was not granted an effective opportunity to present its case before the CIT(A) due to the manner in which notices were issued. Therefore, the Tribunal set aside the CIT(A)'s order.

What were the facts?

The assessee, a trust, had its income assessed at a higher amount than declared, leading to a penalty under Section 270A. The assessee appealed the penalty to the CIT(A), who upheld it. The assessee then appealed to the ITAT.

What were the issues?

Whether the assessee was denied principles of natural justice by the CIT(A) due to inadequate opportunity to be heard, and whether the penalty under Section 270A was validly upheld.

Which sections of the Income-tax Act were involved?

Section 270A,Section 250,Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI BENCHES, MUMBAI

Before: SMT. BEENA PILLAI, HON’BLE & SHRI JAGADISH, HON’BLE

आयकर अपीलीय अधिकरण, म ुंबई पीठें, म ुंबई INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES, MUMBAI BENCH: C BEFORE SMT. BEENA PILLAI, HON’BLE JUDICIAL MEMBER AND SHRI JAGADISH, HON’BLE ACCOUNTANT MEMBER ITA 1279/MUM/2026 (निर्धारण वर्ा/Assessment Year: 2018-19) PUJYA SINDHI ITO EXEMPTION WARD PANCHAYAT TRUST 18(3) VISHRALI NAKA NEAR QURESHI MANSION KANAK AUTOMOBILE Vs. GOKHALE ROAD, PANVEL, MUMBAI-410206, THANE-400602, MAHARASHTRA MAHARASHTRA अपीलधर्थी Appellant प्रत्यर्थी Respondent

Permanent Account Number of AABTP4266E Assessee:

अपीलधर्थी द्वारा/Appellant Mr. Hari Krishnan, AR represented by: (present virtually) प्रत्यर्थी द्वारा/Respondent represented by: Shri Ajay Soneji SR-Dr सुनवाई की तारीख / Date of conclusion of hearing: 15-Sep-2026 घोषणा की तारीख / Date of pronouncement: 25-09-2026 आदेश / ORDER PER SMT. BEENA PILLAI, JUDICIAL MEMBER:

Present penalty appeal is filed by the assessee against the order dated 28/10/2025 passed by the Ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre [“Ld. CIT(A)”] u/s. 250 of the Income-tax Act, 1961 (“the Act”) for Assessment Year 2018-19, on following grounds of appeal:

“1. The impugned appellate order dated 28.10.2025 passed by the Ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre is invalid and unsustainable in law, as it has passed in violation of the Principles of natural Justice, without affording adequate and reasonable opportunity of being heard to the assessee. 2. The Ld. Commissioner of Income Tax (Appeals), NFAC has erred in upholding the penalty imposed u/s 270A made by the Ld. Assessing Officer. 3. The Ld. Commissioner of Income Tax (Appeals) NFAC, has erred on facts and has stated that the Appellant was provided several opportunities to present his case. Indeed there were 5 notices providing the opportunity by the Ld. CIT(A). However, this overlooks the fact that the Appellant has seeked adjournment for the first hearing notice dated 16.07.2025 citing more time for preparation. Later three notices were issued on the exact same date i.e 24.09.2025 each with different DIN no’s and a last opportunity was provided on 27.10.2025. If issuing 3 notices on the same day with different DIN constitutes several opportunities provided to the appellant. It is clearly unfair and injustice to the appellant. 4. The appellant craves leave to add, alter, amend or withdraw any of the above grounds of appeal at the time of hearing.” 2. At the outset, we note that the present appeal is filed by the assessee with a delay of 36 days. The assessee has filed a petition seeking condonation of delay supported by an affidavit. The assessee has explained the circumstances leading to the belated filing and has prayed that the delay, being unintentional and not attributable to any deliberate inaction, may be condoned in the interest of substantial justice. The Ld.AR submitted that the assessee did not stand to derive any benefit by filing the appeal belatedly and requested that the appeal be admitted for adjudication on merits. The Ld.DR opposed the condonation.

2.1 We have perused the condonation petition and the affidavit filed in support thereof. The Hon’ble Supreme Court in the case of Collector, Land Acquisition v. Mst. Katiji & Ors. reported in (1987) 167 ITR 471 (SC) has held that the expression “sufficient cause” is required to receive a liberal construction so as to advance substantial justice and that ordinarily a litigant does not stand to benefit by lodging an appeal belatedly. It was further observed that when substantial justice and technical considerations are pitted against each other, the cause of substantial justice deserves to be preferred. Considering the explanation furnished by the assessee in the petition and affidavit, the relatively short period of delay and there being nothing on record to suggest that the delay was deliberate or mala fide, we are satisfied that sufficient cause existed for not filing the appeal within the prescribed period.

Accordingly, the delay of 36 days is condoned and the appeal is admitted for adjudication.

Brief facts of the case are as under:-

Assessee is a Trust which filed its return of income for the year under consideration declaring total income of Rs.10,57,163/-. The assessment was completed by the Ld. AO u/s. 143(3) of the Act vide order dated 09/03/2021 determining the total income at Rs.67,25,136/- by making an addition of Rs.56,67,973/-. Consequent thereto, penalty proceedings u/s. 270A of the Act were initiated and the Ld.AO vide order dated 18/03/2025 levied penalty of Rs.43,04,674/- on account of alleged misreporting of income.

Aggrieved by the said penalty order, the assessee preferred appeal before the Ld. CIT(A).

The Ld.CIT(A) upheld the penalty.

Aggrieved by the order of the Ld. CIT(A), the assessee is in appeal before this Tribuanal.

5.

Before us, the Ld. AR submitted that the assessee did not receive an adequate and effective opportunity to represent its case before the Ld. CIT(A). Referring to the chronology of notices, he submitted that against the first hearing notice dated 16/07/2025, the assessee had sought an adjournment for preparation of the case. Thereafter, three notices bearing different DINs were issued on the same date, i.e., 24/09/2025, and a final opportunity was granted on 27/10/2025. The impugned order was thereafter passed on 28/10/2025. It was therefore submitted that the assessee could not effectively place its submissions and supporting material before the Ld. CIT(A). The Ld. AR prayed that one more opportunity may be granted to the assessee and the issues may be restored to the Ld. CIT(A) for adjudication afresh.

5.1. The Ld. DR relied upon the impugned order.

We have perused the submissions advanced by both sides in light of the record placed before us.

6.

From the chronology placed before us, we note that though the impugned order records grant of several opportunities, three notices are stated to have been issued on the same date, i.e., 24/09/2025, followed by a final opportunity on 27/10/2025, and the impugned order came to be passed immediately thereafter on 28/10/2025. Considering the facts and circumstances of the case, particularly the levy of penalty of Rs.43,04,674/- u/s. 270A of the Act, we are of the considered opinion that the assessee deserves one effective opportunity to place its case and supporting material before the Ld. CIT(A).

We, therefore, set aside the impugned order and remit the issues to the file of the Ld.CIT(A) for fresh adjudication in accordance with law, after granting reasonable and effective opportunity of being heard to the assessee. The assessee is also directed to diligently participate in the proceedings and furnish all requisite details/evidences as called for without seeking unnecessary adjournments. The Ld.CIT(A) shall thereafter decide the issues by way of a speaking order in accordance with law.

Accordingly, Ground Nos. 1 to 3 are allowed for statistical purposes and Ground No. 4, being general in nature, requires no separate adjudication.

In the result, the appeal filed by the assessee stands allowed for statistical purposes.

Order pronounced in the open court on 25-09-2026.

Sd/- Sd/- JAGADISH BEENA PILLAI ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai Dated: 25-09-2026 Shamik Sr. P.S. Copy to: PUJYA SINDHI PANCHAYAT TRUST , VISHRALI NAKA NEAR KANAK 1 AUTOMOBILE PANVEL, MUMBAI-410206, MAHARASHTRA

ITO EXEMPTION WARD 18(3), 2 QURESHI MANSION GOKHALE ROAD,, THANE-400602, MAHARASHTRA

3 THE PCIT / CIT, 4 THE D.R., ITAT, MUMBAI BENCH 5 GUARD FILE TRUE COPY

ASSISTANT REGISTRAR / SR. PRIVATE SECRETARY I.T.A.T., MUMBAI

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