RELIABLE REALTOUCH,PALGHAR vs. DCIT CIRCLE 4, THANE

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ITA 6468/MUM/2025Status: DisposedITAT Mumbai29 September 20267 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal noted the assessee's primary grievance that the appeal before the CIT(A) was adjudicated ex parte without an effective and meaningful opportunity of being heard, and that replies furnished on the ITBA portal were not considered. The Tribunal acknowledged the Revenue's submission that opportunities were provided and the appeal was adjudicated on merits. However, considering the nature of the issues and the assessee's specific grievance, the Tribunal found that the matter required reconsideration at the first appellate stage. The Tribunal emphasized that appellate proceedings are quasi-judicial and require a reasonable and effective opportunity for the assessee to explain its case and present material. Without entering into the merits of the additions or disallowances, the Tribunal set aside the impugned appellate order and restored the matter to the file of the CIT(A) for fresh adjudication. The CIT(A) was directed to consider the assessee's replies and submissions, including those filed on the ITBA portal, along with further evidence, and adjudicate the appeal afresh after affording a reasonable and effective opportunity of being heard. All issues were left open for the CIT(A)'s consideration.

What were the facts?

The assessee, Reliable Realtouch, filed an appeal before the Income Tax Appellate Tribunal (ITAT) Mumbai, challenging the order of the Commissioner of Income Tax Appeals (CIT(A), NFAC, Delhi) dated 28.08.2025 for Assessment Year 2016-17. The appeal arose from an assessment order under section 143(3) of the Income Tax Act, 1961, passed by the Assistant Commissioner of Income Tax (ACIT), Circle 4, Thane, on 28.12.2018. The assessment order increased the total income to Rs. 4,02,80,910 from the returned income of Rs. 45,91,010. The additions were primarily due to understated turnover on sale of Transferable Development Rights (TDR), disallowance of expenses for structural changes, rejection of partner's remuneration claim, disallowance of interest expenditure as a prior period item, and disallowance under section 40(a)(ia) for non-deduction of TDS. The CIT(A) adjudicated the appeal ex parte as the assessee remained non-compliant.

What were the issues?

1. Whether the Learned CIT(A) erred in confirming additions made by the learned ACIT amounting to Rs. 3,56,89,900, by not considering the injustice given to the assessee by arbitrary additions? 2. Whether the Learned CIT(A) erred in examining details of expenses claimed by the assessee, and ought to have remanded back the assessment for fresh evaluation as the earlier assessment was done in haste to avoid time barring? 3. Whether the Learned CIT(A) was wrong in rejecting the claim on account of partners remuneration amounting to Rs. 2.23 crores as the same was not claimed in the returns of income? Assessee's Contentions: The assessee argued that adequate and reasonable opportunities of being heard were not afforded by the CIT(A). Replies furnished through the ITBA portal on 10.06.2023 and 01.01.2024 were not considered. The assessee contended it was not given an effective and meaningful opportunity to explain its case, especially given the complexity of the issues. The assessment order was passed in haste without proper consideration of submissions. The assessee prayed for the matter to be restored to the CIT(A) for fresh adjudication. Revenue's Contentions: The Revenue supported the orders of the lower authorities, submitting that adequate opportunities were provided to the assessee. Despite these opportunities, the assessee remained non-compliant, leading the CIT(A) to adjudicate ex parte. The Revenue further argued that the CIT(A) considered and adjudicated the issues on merits, warranting no further interference.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 40(a)(ia)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “D” BENCH, MUMBAI

Before: SHRI AMIT SHUKLA, JM & SHRI ARUN KHODPIA, AM

For Appellant: Shri Sanjay Sharma
For Respondent: Shri Prasanna Tewari, Sr. DR
Hearing: 29.09.2026

आयकर अपीलीय अिधकरण �ायपीठ मुंबईम�। IN THE INCOME TAX APPELLATE TRIBUNAL “D” BENCH, MUMBAI BEFORE SHRI AMIT SHUKLA, JM & SHRI ARUN KHODPIA, AM I.T.A. No. 6468/Mum/2025 (Assessment Year: 2016-17) Reliable Realtouch DCIT Circle 4 110, Nikhil Heritage, Achole Income Tax Officer, Vartak Nagar, Vs. Road, Nallasopara East, District Thane-400101 Palghar-401209 PAN: AAPFR2090E Assessee- अपीलाथ� / Appellant Revenue-��थ�/ Respondent :

Assessee by : Shri Sanjay Sharma Revenue by : Shri Prasanna Tewari, Sr. DR : 27.07.2026 Date of Hearing : 29.09.2026 Date of Pronouncement

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, National Faceless Appeal Centre (NFAC), Delhi [in short, “the Ld. CIT(A)”], dated 28.08.2025 for the Assessment Year (AY) 2016-17, arises from the assessment order under section 143(3) of the Income Tax Act, 1961 [in short, “the Act”] dated 28.12.2018, passed by Assistant Commissioner of Income Tax Circle 4, Thane [in short, “the Ld. AO”].

ITA No. 6468/Mum/2025 Reliable Realtouch 2. The grounds of appeal raised by the assessee are as under: “The Learned CIT(A) erred in confirming additions made by the learned Assistant commissioner of Income Tax, circle 4, thane amounting to Rs.3,56,89,900, when he ought to have considered the injustice given to the assessee by arbitrary additions madeby the DCIT, Thane 4 The Learned CIT(A) erred in examining details of expenses claimed by the assessee, he ought to have remanded back the assessment for fresh evaluation as the earlier assessment was done in a haste to avoid time barring. The learned CIT(A) was wrong in rejecting claim on account of partners remuneration amounting to rs. 2.23 crores as the same was not claimed in the returns of income lacks sound judgement. Your appellants crave leave to add, amend or alter all or any of the grounds of appeal before or at the time of the hearing.” 3. The dispute in this case arises from the assessment order dated 28.12.2018 passed under section 143(3) of the Income-tax Act, 1961, wherein the total income was assessed at Rs. 4,02,80,910 as against the returned income of Rs. 45,91,010. The Assessing Officer, on verification of records, found that the turnover relating to sale of Transferable Development Rights was understated, as the books reflected sales of Rs. 6.81 crore while agreements showed actual sales of Rs. 8.92 crore, resulting in a profit of Rs. 3.56 crore which remained unreconciled. Further, a claim of Rs. 1.35 crore towards structural changes was disallowed for want of supporting bills or orders, and a fresh claim of Rs. 2.23 crore for partner’s remuneration was rejected as it was not made in the return of income or audited accounts. In addition, interest expenditure of Rs. 37.46 lakh was treated as a prior period item and disallowed, and a disallowance of Rs. 1.55 lakh u/s 40(a)(ia) was made for non-deduction of TDS on professional fees. These variations resulted in the substantial increase in assessed income, which is

ITA No. 6468/Mum/2025 Reliable Realtouch the subject matter of appeal. vi. The variation arose mainly on account of suppression of turnover relating to sale of Transferable Development Rights (TDR) and consequent disallowances. Despite opportunities provided in the appellate proceedings, no further documentary evidence has been submitted to contest the findings of the Assessing Officer.

4.

The variation arose mainly on account of suppression of turnover relating to sale of Transferable Development Rights (TDR) and consequent disallowances. Despite opportunities provided in the appellate proceedings, no further documentary evidence has been submitted to contest the findings of the Assessing Officer.

5.

Before the Ld. CIT(A), the assessee remained non-compliant and, consequently, the appeal came to be adjudicated ex parte against the assessee.

6.

Before us, the Ld. AR submitted that adequate and reasonable opportunities of being heard were not afforded to the assessee by the Ld. CIT(A). It was further submitted that the replies furnished by the assessee through the ITBA portal on 10.06.2023 and 01.01.2024 were not duly considered while adjudicating the appeal. According to the Ld. AR, the assessee was not afforded an effective and meaningful opportunity to explain its case, particularly having regard to the nature and complexity of the issues involved, which, according to the assessee, required further clarification and explanation.

ITA No. 6468/Mum/2025 Reliable Realtouch 7. The Ld. AR further submitted that the assessment order passed under section 143(3) by the Ld. DCIT(1), Thane was completed in haste during the last week of December 2019, without proper consideration of the submissions and material furnished by the assessee. In these circumstances, it was prayed that the matter be restored to the file of the Ld. CIT(A) for fresh adjudication, after providing adequate opportunity of being heard to the assessee.

8.

Per contra, the Ld. Sr. DR, representing the Revenue, supported the orders passed by the lower authorities. He submitted that adequate / sufficient opportunities had been afforded to the assessee to represent its case before the Ld. CIT(A). However, despite such opportunities, the assessee remained non- compliant. Accordingly, the Ld. CIT(A) proceeded to adjudicate the appeal ex parte. The Ld. Sr. DR further submitted that, notwithstanding the non-compliance of the assessee, the Ld. CIT(A) had considered and adjudicated the issues on merits and, therefore, no further interference was warranted.

9.

We have considered the rival submissions, perused the material available on record and examined the facts and circumstances of the case. The primary grievance of the assessee is that the appeal before the Ld. CIT(A) came to be adjudicated ex parte without affording an effective and meaningful opportunity of being heard. It is also the specific contention of the assessee that replies were furnished through the ITBA portal on 10.06.2023 and 01.01.2024, which,

ITA No. 6468/Mum/2025 Reliable Realtouch according to the assessee, were not taken into consideration while disposing of the appeal.

10.

From the material placed before us, it is evident that the assessee had sought to place its explanation before the first appellate authority. Considering the nature of the issues involved and the assessee’s specific grievance that the aforesaid replies and accompanying submissions were not duly considered, we are of the view that the matter requires reconsideration at the first appellate stage. The appellate proceedings being quasi-judicial in nature, the assessee ought to have a reasonable and effective opportunity to explain its case and place the relevant material on record before the appeal is finally adjudicated.

11.

At the same time, we take note of the submission of the Ld. Sr. DR that reasonable opportunities had been afforded to the assessee and that the Ld. CIT(A), notwithstanding the non-compliance, proceeded to adjudicate the appeal on merits. However, without entering into the merits of the respective issues or expressing any opinion thereon, and in order to ensure proper and effective adjudication of the appeal on the basis of the material available on record, we deem it appropriate to restore the matter to the file of the Ld. CIT(A).

12.

Accordingly, the impugned appellate order is set aside and the matter is restored to the file of the Ld. CIT(A) for fresh adjudication in accordance with law. The Ld. CIT(A) shall consider the replies/submissions furnished by the assessee, including those stated to have been filed on the ITBA portal on 5

ITA No. 6468/Mum/2025 Reliable Realtouch 10.06.2023 and 01.01.2024, along with such further evidence and explanations as may be lawfully placed on record, and thereafter adjudicate the appeal afresh on merits. Needless to state, the assessee shall be afforded reasonable and effective opportunity of being heard.

13.

We clarify that we have not expressed any opinion on the merits of the additions/disallowances or any other issue arising in the appeal, and all such issues are left open for consideration by the Ld. CIT(A) in accordance with law.

14.

In result the appeal of assessee stands allowed for statistical purposes, in terms of our afore said observations.

Order pronounced in the open court on 29-09-2026.

Sd/- Sd/- (AMIT SHUKLA) (ARUN KHODPIA) JUDICIAL MEMBER ACCOUNTANT MEMBER

Mumbai, Dated : 29-09-2026. Ankit K., Sr. PS

ITA No. 6468/Mum/2025 Reliable Realtouch

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

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