DCIT-13.3.2, MUMBAI vs. ZUME INDIA PRIVATE LIMITED, MUMBAI

ITA 9496/MUM/2025Status: DisposedITAT Mumbai23 September 2026AY 2022-238 pages
AI SummaryRemanded

What were the facts?

The assessee, Zume India Private Limited, engaged in trading and distribution of sustainable moulded fibre packaging, filed its return for Assessment Year 2022-23 showing a loss. The Assessing Officer (AO) made additions of ₹1,44,17,733/- under Section 69C for unexplained expenditure related to goods in transit and disallowed ₹31,12,761/- under Section 43B for non-proof of payment of statutory dues and employee benefit expenses. The AO also questioned the eligibility of brought-forward losses of ₹9,89,12,532/-. The assessee appealed to the CIT(A). During appellate proceedings, the assessee submitted additional documents. The CIT(A) deleted the additions and disallowed amounts, accepting the assessee's explanations and evidence. The Department appealed to the ITAT against the CIT(A)'s order.

What did the Tribunal hold?

The Tribunal held that the CIT(A) had not complied with the requirements of Rule 46A of the Income Tax Rules, 1962, which mandates that if additional evidence is admitted, the reasons for admission must be recorded, and the Assessing Officer must be given a reasonable opportunity to examine the evidence and produce material in rebuttal. The Tribunal noted that in all three disputed issues – the addition under Section 69C, the disallowance under Section 43B, and the claim for brought-forward losses – the CIT(A) had granted relief based on documents produced during the appellate stage, without affording the AO an opportunity to verify and comment on this evidence. The Tribunal found no indication that the documents were forwarded to the AO for comments or that a remand report was called for. Therefore, without expressing any opinion on the merits of the additions or the correctness of the documentary evidence, the Tribunal restored these issues to the file of the CIT(A) for fresh adjudication. The CIT(A) is directed to ascertain which documents were previously filed, deal with the admissibility of additional evidence under Rule 46A, forward the material to the AO for a remand report, allow the assessee to respond to the remand report, and then decide the issues afresh after giving both sides a reasonable opportunity of hearing.

What were the issues?

1. Whether, on the facts and circumstances of the case and in law, the CIT(A) erred in deleting the disallowance of brought forward losses of ₹9,89,12,532/- without appreciating that the assessee failed to furnish necessary documentary evidence during assessment proceedings to substantiate eligibility for carry forward under Section 72 of the Income Tax Act, 1961, and did not comply with opportunities provided under Section 142(1)? (Question of law and fact, concerning Section 72). 2. Whether, on the facts and circumstances of the case and in law, the CIT(A) erred in deleting the addition of ₹1,44,17,733/- under Section 69C in respect of inventory discrepancy by admitting additional evidence in violation of Rule 46A without affording the AO an opportunity for verification and failed to appreciate the assessee's failure to discharge its primary onus? 3. Whether, on the facts and circumstances of the case and in law, the CIT(A) erred in deleting the disallowance of ₹31,12,761/- under Section 43B by admitting additional evidence in violation of Rule 46A without affording the AO an opportunity for verification and failed to appreciate the assessee's failure to discharge its primary onus? Assessee's contentions: Not recorded. Revenue's contentions: The CIT(A) erred in deleting the disallowances/additions based on documents produced during appellate proceedings without giving the AO an opportunity to examine and rebut such evidence, violating Rule 46A.

Which sections of the Income-tax Act were involved?

Section 72,Section 142(1),Section 69C,Section 43B,Section 250(4)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI

Before: SHRI SIDDHARTHA NAUTIAL & SHRI PRABHASH SHANKAR

For Respondent: Shri Sudhir Kumar Das (Virtually appeared)

PER SHRI NARENDER KUMAR CHOUDHRY, JUDICIAL MEMBER:

This appeal is filed by the Department against the order of Ld. NFAC / Ld. CIT(A) vide order dated 06-Oct-2025 for the Assessment Year 2022-23. The Department has raised the following grounds of appeal:

1 On facts and circumstances of the case and in law the Ld CIT A erred in deleting the disallowance of brought forward losses of Rs 98912532 without appreciating that t

The order continues below.

Read the full judgment

A free account opens 10 full judgments a month. Re-reading one you have already opened does not count again.

Create a free accountSign in

See plans and prices

The summary, the parties, the sections and the citations above are open to everyone and always will be. Only the text of the order and the PDF are metered.

More judgments on Section 72

All 380 judgments and leading authorities on Section 72 →

Recent GST High Court judgments

Search GST case law →