ITAT Mumbai Sets Aside Ex Parte Order on ₹77.82 Lakh Disallowance; Remands Matter to CIT(A) for Fresh Adjudication

Key Facts and Tribunal Findings

The Income Tax Appellate Tribunal (ITAT), Mumbai Bench, allowed the appeal of Veda Real Estate Corporation Pvt. Ltd. for Assessment Year 2013–14 and set aside the ex parte order passed by the Commissioner of Income Tax (Appeals), remanding the matter for fresh adjudication.

The dispute pertained to disallowance of ₹77.82 lakh incurred towards site office and sample flat expenses. The Assessing Officer had treated the expenditure as not allowable, and the CIT(A) upheld the addition by passing an ex parte order, observing that the assessee failed to furnish necessary details.

Before the Tribunal, the assessee submitted that detailed written submissions along with supporting documents and additional evidence had already been filed in earlier appellate proceedings. It was contended that due to transfer of jurisdiction across multiple appellate authorities post-COVID, these submissions were not considered while passing the impugned order.

The Tribunal noted that the CIT(A) had dismissed the appeal without considering the written submissions and additional evidence already on record. It held that such non-consideration amounted to denial of reasonable opportunity and violated principles of natural justice.

Accordingly, the Tribunal set aside the impugned order and restored the matter to the file of the CIT(A) for de novo adjudication. It directed that all submissions and additional evidence be duly considered, and that reasonable opportunity of hearing be provided to the assessee.

The Tribunal also permitted the CIT(A) to seek a remand report from the Assessing Officer, if required, in respect of additional evidence. The appeal was allowed for statistical purposes.