DY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE 4 1, MUMBAI vs. SUSNEH INFRAPARK PRIVATE LIMITED, MUMBAI

ITA 9262/MUM/2025Status: DisposedITAT Mumbai24 September 2026AY 2024-2537 pages
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What did the Tribunal hold?

The Tribunal held that the additions on account of alleged on-money receipts should be restricted to 8% of the identified receipts, not 15% as sustained by the CIT(A). The reasoning was that the Revenue had not established that the entire gross receipt represented income, nor that project-related expenditure arose from an independent source, nor that reliable material existed for estimating on-money in respect of unidentified units. The Tribunal also deleted the 5% disallowance from subcontracting expenditure, finding no identified defect in the assessee's supporting documents. The adjustment retained by the CIT(A) was deleted, and the AO was directed to restore the amount to Work-in-Progress. Regarding section 43CA, the AO was permitted to examine its applicability in the legally appropriate year upon corresponding revenue recognition, with due opportunity to the assessee. The grounds challenging the validity of section 147 proceedings were dismissed as not pressed. Additional legal grounds concerning section 148 were left open and treated as academic. The Tribunal dismissed the Revenue's appeals entirely.

What were the facts?

The Income Tax Appellate Tribunal (ITAT) Mumbai Bench heard consolidated appeals from Susneh Infrapark Private Limited (assessee) and the Assistant Commissioner of Income Tax (Revenue) for Assessment Years 2021-22 to 2024-25. The appeals stemmed from search and seizure action under section 132 on the Runwal Group, which included the assessee. The Assessing Officer (AO) made additions based on a seized diary, digital communications, and recorded statements, alleging receipt of on-money, unaccounted expenditure, and subcontracting charges. The Commissioner of Income Tax (Appeals) partially upheld some additions. The assessee challenged the evidentiary basis and quantification of additions, while the Revenue contested the relief granted by the CIT(A).

What were the issues?

1. Whether the additions on account of alleged on-money receipts, sustained by the CIT(A) at 15% of the identified receipts, are valid, and if so, what is the correct quantum of income to be taxed? (Section 28, Section 43CA) - Assessee: Contended that statements relied upon by the AO were retracted, and there was no independent material to establish actual receipt of cash from purchasers. Argued that the CIT(A)'s sustenance of 15% was incorrect. - Revenue: Contended that the entire unaccounted receipts ought to have been assessed as income and challenged the restriction of additions to 15% by the CIT(A). 2. Whether the disallowance of 5% of subcontracting expenditure incurred through M/s Senghani Creators Pvt. Ltd. and the corresponding reduction from Work-in-Progress for Assessment Years 2023-24 and 2024-25 are justified? (Section 40A(3)) - Assessee: Challenged the 5% disallowance and reduction from Work-in-Progress. - Revenue: Challenged the relief granted in respect of subcontracting expenditure. 3. Whether the validity of proceedings initiated under section 147 for Assessment Years 2021-22 and 2022-23 is sustainable? (Section 147, Section 148) - Assessee: Initially challenged the reopening but later stated these grounds were not pressed. - Revenue: No specific argument recorded on this point.

Which sections of the Income-tax Act were involved?

Section 28,Section 43CA,Section 147,Section 143(3),Section 132,Section 148,Section 40A(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘F’ BENCH

Before: SHRI AMIT SHUKLA & SHRI ARUN KHODPIA

For Appellant: Shri Rakesh Joshi, CA
For Respondent: Shri Bal Krishna Yadav, SR
Hearing: 21/08/2026Pronounced: 24/09/2026

Heard together (2 matters)

ITA No.8541/Mum/2025
ITA No.9260/Mum/2025

Read from the judgment's own cause title. This page is filed under one of them.

PER AMIT SHUKLA (JM):

The captioned appeals comprise four appeals preferred by the assessee, being ITA Nos. 8541 to 8544/Mum/2025 for Assessment Years 2021-22 to 2024-25, and three corresponding appeals preferred by the R

The order continues below.

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