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Facts
The assessee, Shabana Kaizer Jangbarwala, had not filed her income tax return for AY 2016-17. Her case was reopened based on information that she jointly purchased a property for Rs. 56,00,000, leading to an addition of Rs. 59,66,000 as unexplained investment by the AO. The CIT(A) dismissed her appeal *in limine* without condoning a 57-day delay in filing, holding that no sufficient cause for the delay was explained.
Held
The ITAT found the assessee's explanation for the delay (email being filtered to spam/junk) to be a justifiable and sufficient cause, considering the principles of natural justice. The Tribunal therefore remanded the case back to the Assessing Officer for a *de novo* assessment, directing the AO to duly consider the assessee's submissions and admit additional evidence for proper adjudication on merits.
Key Issues
Condonation of delay in filing appeal before the CIT(A); validity of assessment reopening; addition for unexplained investment in property.
Sections Cited
250, 249(2), 147, 69, 69C, 144A, 144B
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “B” BENCH, MUMBAI
Before: SHRI OM PRAKASH KANT, AM AND
IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH, MUMBAI
BEFORE SHRI OM PRAKASH KANT, AM AND MS. KAVITHA RAJAGOPAL, JM ITA No.8636/Mum/2025 (Assessment Years: 2016-17)
Ms. Shabana Kaizer Jangbarwala, ITO Ward – 42(3)(3), Flat No.B-10, 4th Floor, Room No.754C, 7th Floor, Chembur Fairlawn CHS, Kautilya Bhavan, Near Diamond Garden, Vs. Bandra Kurla Complex, Sion Trombay Road, Bandra (East), Chembur, Mumbai – 400 051 Maharashtra – 400 071 PAN: AGQPJ4858D (Appellant) : (Respondent)
: Shri Ajay R. Singh, AR Assessee by Respondent by : Shri Swapnil Choudhari, Sr. AR
Date of Hearing : 19.02.2026 Date of Pronouncement : 24.02.2026
O R D E R Per Kavitha Rajagopal, J M:
This appeal is filed by the assessee, challenging the order of the Learned
Commissioner of Income Tax [‘Ld. CIT(A)’ for short], National Faceless Appeal Centre
(‘NFAC’ for short) passed u/s. 250 of the Income Tax Act, 1961 (‘the Act') pertaining to
the Assessment Year (‘A.Y.’ for short) 2016-17.
The assessee has raised the following grounds of appeal:
“1. The learned CIT(A) erred in dismissing the appeal of the assessee by holding that the appeal is not filed in time as provided under section 249(2) of the Act without appreciating that assessee had filed application for condonation of delay of 57 days in filing the appeal, explaining the reasons namely non receipt of the order in the main inbox email, but could have landed in the spam mail, therefore refusing to condone the delay and dismissing the appeal was not justified.
ITA No.8636/Mum/2025 Ms. Shabana Kaizer Jangbarwala
The Ld. CIT(A) failed to appreciate that the delay was due to a bona fide technical reason specifically due to non-receipt of the assessment order, thus the learned CIT(A) failed to appreciate that the appellant had demonstrated sufficient and reasonable cause for the delay, which was neither found to be false, misleading, intentional nor deliberate.
The refusal to condone the delay and dismissal of the appeal without adjudication on merits violates the principles of equity, and natural justice particularly since the Appellant had already filled detailed responses during the assessment proceedings.
Reopening is bad in law:
The learned CIT(A) failed to appreciate that the learned AO erred in reopening of assessment u/s 147 of the Act as the same was initiated without independent application of mind or valid reason to believe that income has escaped assessment, as the investment is property was by assessee's father who is a super senior citizen and name of assessee was added for convenience sake.
Addition unexplained investment w/s 69 of the Act Rs.50,66,000/-
The learned CIT(A) erred in not adjudicating the appeal on merits namely that the addition made towards unexplained investment u/s 69C of the Act of Rs. 59,66,000/- is without appreciating the fact that the investment in property was made by the father of the assessee, from his source of funds ( sale of property) and the same was duly explained vide replies dated 16/08/2024 and 24/01/2025 before the AO alongwith supporting documents.
The learned CIT(A) failed to appreciate that the purchase consideration of Rs. 11/ lacs was paid in AY 2016-17 and balance Rs.45/ lacs was paid in AY 2017-18, the documentary evidence including bank statement and Income Tax Return of the father of assessee for A.Y. 2017-18 having total income of Rs.91,68,300/- clearly establishing the source of fund and creditworthiness, was duly filed before the AO.
The learned CIT(A) failed to appreciate that assessee's father had declared 100% share in the property which is reflected in the returns filed, therefore making addition in hands of the assessee was unjustified as the same will lead to double taxation.
The Assessee craves leave to add, alter, amend, delete and/or modify all or any of the above grounds of appeal.”
Brief facts of the case are that the assessee is an individual and had not filed her
return of income for the year under consideration. The assessee’s case was reopened based
on information from insight portal as per Risk Management Strategy where assessee had
ITA No.8636/Mum/2025 Ms. Shabana Kaizer Jangbarwala
purchased a property jointly in her name and Mr. Kaizer Husein Jangbarwalla amounting
to Rs.56,00,000/- during the year under consideration. The Learned Assessing Officer
(“Ld. AO” for short) passed the assessment order dated 25.02.2025 u/s 147 r.w.s. 144A
r.w.s. 144B of the Act determining the total income at Rs.59,66,000/- after making the
addition of the impugned amount as unexplained investment which was not substantiated
by cogent documentary evidences.
The assessee was in appeal before the first appellate authority who vide order dated
12.11.2025 dismissed the appeal of the assessee in limine without condoning the delay of
57 days in filing the appeal beyond the period of limitation on the ground that there was no
‘sufficient cause’ explained by the assessee for the said delay.
Aggrieved by the order of the Ld. CIT(A), the assessee is in appeal before us,
challenging the order of the Ld. CIT(A).
The Learned Authorised Representative (‘Ld. AR’ for short) contended that the
assessee had a ‘sufficient cause’ for the delay in filing the first appeal before the Ld. CIT(A)
for the reason that the email communication sent by the Department was inadvertently
filtered into the spam/junk folder of the assessee’s email account, which escaped the
attention of the assessee at the relevant time. The Ld. AR contended that the assessee was
not negligent in filing the first appeal within the period of limitation and did not have any
malafide intention, as the issue on the merits are in favour of the assessee. The Ld. AR
prayed that the assessee be given one more opportunity to present her case before the lower
authorities.
ITA No.8636/Mum/2025 Ms. Shabana Kaizer Jangbarwala
The Departmental Representative (‘Ld. DR’ for short), on the other hand, opposed
to setting aside the issue to the lower authorities for the reason that the assessee has failed
to explain that there was ‘sufficient cause’ for the delay in filing the first appeal. The Ld.
DR relied on the order of the lower authorities.
We have heard the rival submissions and perused the materials available on record.
It is observed that the assessee has challenged the assessment order before the first
appellate authority which was filed belatedly with the delay of 57 days and the same was
not condoned by the Ld. CIT(A) for the reason that the assessee has failed to explain that
there was ‘sufficient cause’ for the delay. Before us, the Ld. AR cited the reason for the
delay, which according to us is justifiable considering the quantum of delay as well as that
the assessee failed to notice the communication of the Income Tax Department sent through
email. In the interest of justice dispensation and also by adhering to the principles of
natural justice, we deem it fit to remand this issue back to the file of the Ld. AO extending
the assessee with one more opportunity to present her case before the Ld. AO as the
assessment order also was on the basis of best judgment assessment. The assessee is
directed to strictly comply with the proceeding before the Ld. AO without any undue delay
from her side and the Ld. AO is directed to pass a denovo assessment after duly considering
the assessee’s submission in accordance with the provisions of law and on the merits of the
case. The Ld. AO is also directed to admit the additional evidences filed by the assessee
before the Ld. CIT(A) for proper adjudication of the issue in hand.
ITA No.8636/Mum/2025 Ms. Shabana Kaizer Jangbarwala
In the result, the appeal filed by the assessee is hereby allowed for statistical
purpose.
Order pronounced in the open court on 24.02.2026
Sd/- Sd/- (OM PRAKASH KANT) (KAVITHA RAJAGOPAL) ACCOUNTANT MEMBER JUDICIAL MEMBER
Mumbai; Dated: 24.02.2026 * Kishore, Sr. P.S.
Copy of the Order forwarded to:
The Appellant 2. The Respondent 3. CIT- concerned 4. DR, ITAT, Mumbai 5. Guard File BY ORDER,
(Dy./Asstt.Registrar) ITAT, Mumbai