Mahindra and Mahindra Financial Services Ltd Vs DCIT (ITAT Mumbai)
The appeal was filed against the order of the Commissioner of Income-tax (Appeals), National Faceless Appeal Centre, dated 16 July 2025 for Assessment Year 2019-20. The assessee, a registered NBFC engaged in financial services, challenged the assessment order and the appellate order on grounds including lack of adequate opportunity of hearing, violation of principles of natural justice, disallowance of sales promotion expenses, disallowance under Section 14A, disallowance of club expenses, and denial of deduction under Section 80JJAA.
During the assessment proceedings, the Assessing Officer issued a notice under Section 142(1) containing 18 detailed queries. The assessee furnished partial details on 27 September 2021 and informed the Assessing Officer that it was compiling the remaining information. The assessee also requested an opportunity of hearing through video conferencing before any adverse inference was drawn. However, the Assessing Officer passed the assessment order under Sections 143(3) read with 144B on 30 September 2021 without waiting for the final reply or granting a hearing.
In appellate proceedings, the assessee filed written submissions and sought admission of additional evidence. The CIT(A) forwarded the material to the Assessing Officer and called for a remand report. The Assessing Officer issued a notice regarding the additional evidence, and the remand proceedings were ongoing. However, the CIT(A) disposed of the appeal without obtaining the remand report, without informing the assessee about closure of remand proceedings, and without providing a final opportunity of hearing.
