IN THE INCOME TAX APPELLATE TRIBUNAL “F” BENCH, MUMBAI BEFORE SHRI ARUN KHODPIA, ACCOUNTANT MEMBER SHRI SANDEEP SINGH KARHAIL, JUDICIAL MEMBER ITA No.5947/MUM/2025 (Assessment Year: 2018-19)

Sheth Realtors Vasant Oasis, Site Office, Upper Basement, CTS No.345A 1 to 3, 345A 5 to 6, Makwana Road, Marol, Andheri (East), ............... Appellant Mumbai – 400059 PAN: AAVFA3975F v/s Assistant Commissioner of Income Tax, Central Circle - 7(1), ……………… Respondent 653, Aayakar Bhavan, 6^th Floor, M.K. Road, Mumbai – 400020 Assessee by : Dr. K Shivram Shri Rahul Hakkani Revenue by : Shri Vivek Perampurna, CIT-DR Date of Hearing – 14/01/2026 Date of Order - 19/01/2026

O R D E R

PER SANDEEP SINGH KARHAIL, J.M.

The assessee has filed the present appeal against the impugned order dated 30/07/2025, passed under section 250 of the Income Tax Act, 1961 (“the Act”) by the learned Commissioner of Income Tax (Appeals)-49, Mumbai, [“learned CIT(A)”], for the assessment year 2018-19.

2. In this appeal, the assessee has raised the following grounds: –

“1. Ground No. 1 - Disallowances under addition made to Work in Progress for the year 2017-2018 of Rs. 52,94,101/-:

1.1. The Ld. CIT(A) erred in confirming the disallowance of expenses amounting to Rs. 52,94,101/- solely on the grounds that the parties did not submit a response to the notice issued under section 133(6) of the Income Tax Act.

1.2. Out of Rs. 52,94,101/-, the Ld. CIT(A) erred in confirming the disallowance at 33% of expenses of Rs. 58,65,368/- disallowed by AO i.e. 19,35,571/- on adhoc basis solely on the ground that the parties did not submit a response to notice issued u/s. 133(6) of the Act without appreciating the fact that during the assessment proceedings assessee discharge its primary onus by submitting complete party wise details of expenses along with PAN and Address of parties and supporting documents pertaining to the major expenses / purchases made from these parties on sample basis.

1.3. Out of Rs. 52,94,101/-, the Ld. CIT(A) erred in confirming the disallowance at 33% of expenses of Rs. 58,65,368/- disallowed by AO i.e. 19,35,571/- on adhoc basis solely on the ground that the parties did not submit a response to notice issued u/s. 133(6) of the Act without appreciating the fact that during the assessment proceedings assessee has submitted complete party wise details of expenses along with PAN and Address of parties and supporting documents pertaining to the major expenses / purchases made from these parties on sample basis and Ld. AO did not issue any Notice u/s.

133(6) of the Act for major Expenses.

1.4. Out of Rs. 52,94,101/-, the Ld. CIT(A) erred in confirming the disallowance of Rs.33,58,536/- solely on the ground that the parties did not submit a response to notice issued u/s. 133(6) of the Act without appreciating the fact that during the assessment proceedings assessee discharge its primary onus by submitting complete party wise details of expenses along with PAN and Address of parties and supporting documents pertaining to the major expenses / purchases made from these parties on sample basis.

1.5. The Ld. CIT(A) erred in confirming disallowance made by AO without appreciating the fact that all books of accounts including ledger of parties were impounded during the course of survey and were available with AO.

2. Ground No. 2 - Disallowance on penalty/interest paid on late payment of TDS & Service Tax of Rs.4,15,168/-:

2.1. The Ld. CIT(A) erred in not adjudicating the ground of appeal of assessee regarding the disallowance of Rs. 4,15,168/- made by the AO on account of interest for the late payment of TDS.

2.2. The Ld. AO erred in disallowing Rs. 4,15,168/- for interest on late payment of TDS without considering the fact that interest has been paid late depositing the TDS in account of revenue not on Income Tax.

2.3. The Ld. AO erred in disallowing for interest on late payment of TDS without appreciating the fact that interest on late payment of TDS is compensatory in nature and not