IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH “A”, PUNE BEFORE SHRI MANISH BORAD, ACCOUNTANT MEMBER AND SHRI VINAY BHAMORE, JUDICIAL MEMBER आयकर अपील सं. / ITA No.362/PUN/2025 िनधा(cid:6981)रण वष(cid:6981) / Assessment Year : 2018-19 MCM Developers, Vs. DCIT, Central Circle-1, nd

2 Floor, Tapadiya Aurangabad.

Terraces, Adalat Road, Aurangabad- 431001.

PAN : AAXFM0436D Appellant Respondent Assessee by : Shri Pramod Shingte Revenue by : Shri Amol Khairnar Date of hearing : 07.08.2025 Date of pronouncement : 17.09.2025 आदेश / ORDER PER VINAY BHAMORE, JM:

This appeal filed by the assessee is directed against the order dated 16.12.2024 passed by Ld. CIT(A), Pune-12 [‘Ld. CIT(A)’] for the assessment year 2018-19.

2. The appellant has raised the following grounds of appeal :-

“1. On the facts and in the circumstances of the case and in law the lower authorities erred in passing, a rectification order under section 154 dated 11/09/2021, thereby changing the section for initiating the penalty action, from Section 269ST to 269SS and further changing the initiating of penalty section from Section 271DA to 271D. The action cannot be considered as apparent mistake rectifiable under Section 154, as the initial invocation of penalty under section 271DA was with complete application of mind by Learned Assessing Officer as well as by Learned Joint CIT who also initiated penalty proceedings under section 271DA therefore order passed under section 154 is bad in law and deserves to be struck down.

Your appellant prays for deletion of entire addition. Your appellant craves for to add, alter amend, modify, delete any or all grounds of appeal before or during the course of hearing in the interest of natural justice.”

3. Facts of the case, in brief, that the assessee is a firm engaged in the business of builders, developers, contractors, real estate agent and brokers etc. A notice u/s 153C of the IT Act was issued to the assessee and after considering replies of the assessee, vide order dated 07.05.2021 assessment order u/s 153A r.w.s. 153C of the IT Act was passed by assessing net loss of Rs.55,13,110/- as against the loss returned by the assessee at Rs.2,86,55,166/-. The above loss was assessed after making addition of Rs.1,22,21,350/- on account of profit determined on cash receipt of Rs.2,50,14,000/- and also includes addition of Rs.1,06,92,650/- on account of disallowance of cash expenses in violation of section 40A(3) and also addition of Rs.2,28,056/- on account of ad-hoc disallowance out of various expenses, accordingly the returned loss was reduced by total addition of Rs.2,31,42,056/-.

4. In the above said assessment order, the Assessing Officer, on the basis of seized documents found, that the assessee firm has sold the flats to the various purchasers and received on money of Rs.2,50,14,000/- in cash and therefore contravened the provisions of section 269ST of the IT Act by receiving the above cash of Rs.2,50,14,000/- and accordingly a reference was made by him to Joint Commissioner of Income Tax for initiation of penalty u/s

271DA of the IT Act.

5. Subsequently, vide notice dated 20.08.2021 the Assessing Officer issued notice u/s 154 of the IT Act to rectify the above assessment order dated 07.05.2021 mentioning that “1. At Para 5.9 of the said assessment order, section 269ST of the Act is written inadvertently. The section should be 269SS in place of 269ST. Accordingly, reference made to the Joint Commissioner of Income Tax, Central Range, Nashik for initiation of penalty u/s 271DA should be 271D. Hence, it is proposed to be rectified”.

6. Since the assessee did not reply to the above said notice, the Assessing Officer vide order dated 11.09.2021 passed rectification order u/s 154 r.w.s. 153C of the IT Act by observing as under :- “4. On perusal of the assessment order passed on 07/05/2021 in this case, it was seen that at Para 5.9 of the said assessment order, section 269ST of the Act is written inadvertently. The section should be written as 26