Navrang Hospitality Private Limited Vs ITO (ITAT Mumbai)
The Mumbai ITAT condoned a 34-day delay in filing the appeal after accepting that the assessee genuinely believed its tax consultant had filed the Tribunal appeal. The lapse came to light only when the assessee received a demand notice and discovered that no appeal had been filed.
Both the reassessment under Sections 147 read with 144B and the first appeal had been decided ex parte, as the assessee failed to furnish proper replies before the AO and the CIT(A).
The assessee contended that the addition was based solely upon a third-party statement, without incriminating material, corroborative evidence or any demonstrated nexus with income escaping assessment. It sought an opportunity to produce the relevant information now available with it.
Without deciding the addition on merits, the Tribunal restored the matter to the AO for a fresh assessment after granting adequate opportunity of hearing. However, the remand was made conditional upon the assessee depositing ₹50,000 as costs in the Prime Minister’s Relief Fund within 30 days of receiving the order.
FULL TEXT OF THE ORDER OF ITAT MUMBAI
This appeal is filed by the assessee against the order of the learned CIT(A)-NFAC, Delhi, dated 11.09.2025 for the assessment year 2013- 14.
2. Learned Counsel for the assessee, at the outset, submitted that the appeal of the assessee is delayed by 34 days and an application for condonation of delay and affidavit was furnished in the paper book at pages 121 to 130. Learned Counsel referring to page 121 of the paper book, which is the petition for condonation of delay, submitted that the assessee entrusted the tax matters to its consultant, Mrs. Prachi Gawade, who was looking after the accounts and tax matters of the assessee company to file an appeal before the Tribunal. Learned Counsel submitted that Mrs. Prachi Gawade was also handling the appeal before the learned CIT(A) and she appeared before the learned CIT(A) in the proceedings. The appeal order was sent to the tax consultant for taking necessary steps to file further appeal before the appropriate forum and the assessee was under a bona fide impression that the appeal had been filed within the prescribed time. However, when a demand notice dated 26.02.2026 was received by the assessee, the assessee made inquiries with the office of the tax consultant and requested a copy of the appeal filed before the Tribunal for assessment year 2013-14. At this stage, the tax consultant informed the assessee that she was not handling matters relating to the appeals before the Tribunal and the assessee should engage another professional for the said purpose. As the assessee was under the bona fide belief that the tax consultant had taken necessary steps for filing an appeal within the prescribed time and ultimately came to know that no appeal was filed, the assessee took steps immediately to file an appeal before the Tribunal on 06.03.2026, which resulted in a delay of 34 days, which is neither intentional nor deliberate and was learned Counsel for the assessee submitted that the delay in filing the appeal before the Tribunal be condoned.
3. Considering the rival submissions, perusing the petition for condonation of delay and accompanying affidavit, we are of the view that the assessee was prevented by a reasonable cause from filing the appeal with a delay of 34 days and, therefore, the same is hereby condoned and the appeal is admitted for adjudication.
4. Coming to the merits of the case, the learned Counsel for the assessee submitted that the appeal was disposed of by the learned CIT(A) ex-parte for non-prosecution. Learned Counsel further submitted that the assessment framed by the Assessing Officer is also u/s 147 read with section 144B of the Act and is a best judgment assessment as the assessee could not submit replies before the Assessing Officer.
5. Learned Counsel for the assessee submitted that in the interest of justice, the matter may be restored to the file of the Assessing Officer for fresh assessment as the assessee could not furnish the proper reply either before the Assessing Officer or before the learned CIT(A). The learned Counsel for the assessee further submitted that the addition which was made by the Assessing Officer was solely on the basis of the third-party statement and without establishing any nexus within the alleged seized material, inflow and escapement of income in the hands of the assessee. Learned Counsel for the assessee submitted that the material was found from the assessee, no corroborative evidence was brought on record and the addition has been sustained merely on presumption and borrowed satisfaction. Therefore, the addition is unsustainable in law. Learned Counsel for the assessee submitted that the assessee is in possession of the relevant information and is now in a position to furnish the information before the Assessing Officer and, thus, the matter may be restored to the file of the Assessing Officer for fresh assessment.
6. Considering the rival submissions and perusing the orders of the authorities below, we are inclined to restore this appeal to the file of the Assessing Officer for fresh assessment subject to the assessee remitting Rs. 50,000/- towards cost into the account of Prime Minister Relief Fund within a period of 30 days from the date of receipt of this order. Thus, this appeal is restored to the file of the Assessing Officer for fresh assessment on the issues in appeal in accordance with law after providing adequate opportunity to the assessee.
7. In the result, the appeal of the assessee is allowed for statistical purposes.
Order pronounced in the open court on 21/08/2026
