AKSHAT TANDON,ALLAHABAD V. D-A DIRECTOR OF INCOME TAX (INTERNATIONAL TAXATION), LUCKNOW

ITITA 362/LKW/2023

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The case involves Akshat Tandon, the appellant, who appealed against the order of the Deputy Commissioner of Income Tax (DCIT), Lucknow, for the assessment year 2021-22. The primary contention was regarding the denial of deduction under section 54 of the Income Tax Act, 1961, for a payment of Rs.26,25,000 made towards the purchase of a flat, which was allegedly made after the due date for filing the return. The appellant argued that the overall investment was within the stipulated time and that the late payment should not disqualify the deduction. The tribunal's decision to dismiss the appeal was based on the procedural compliance with the DTVSVS, which aims to resolve disputes and reduce litigation.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 471436 (ITAT-LUCKNOW)
• Appeal Type: Income Tax (International Taxation) Appeal
• Pronouncement Date: 03-03-2025
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2021-2022
• Laws Referred To: Income Tax Act
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SANJEEV KRISHNA SHARMA
• Assessee Lawyers: ASHISH BANSAL
• Keywords: Capital asset; Principle of natural justice
• Section: 54; 139(1)

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH “B”, LUCKNOW BEFORE SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER AND SHRI ANADEE NATH MISSHRA, ACCOUNTANT MEMBER IT(IT)A No.362/LKW/2023 (Assessment Year: 2021-22) Akshat Tandon 33, Dayanand Marg, Opp. SMC School, Allahabad-211002. v. Deputy/Assistant Director of Income Tax (International Taxation), PK Bhawan, 18, Madan Mohan Malviya Marg, Lucknow-226001. PAN: AAXPT4551A (Appellant) (Respondent) Appellant by: Shri Ashish Bansal, Adv Respondent by: Shri Sanjeev Krishna Sharma, Addl. CIT(DR) O R D E R PER ANADEE NATH MISSHRA, A.M.: (1). The present appeal has been filed by the assessee against the impugned order dated 27.09.2023 order passed by the Ld. Deputy Commissioner of Income Tax (hereinafter referred as to “DCIT”), Lucknow, pertaining to the assessment year 2021-22. The grounds of appeal of the assessee are as under: - “1. BECAUSE the Assessing Officer has erred in law and on facts in not appreciating that the appellant had duly discharged the payment of sums aggregating to Rs.5,51,25,000/- which has been claimed as deduction under section 54 of the Act, merely for the reason that cheque no. 137968 dated 29.12.2021 for Rs.26,25,000/- having been presented for payment after the extended due date for filing of return under section 139(1) of the Act for the Assessment Year 2021-22, no adverse view could have been taken by him against the appellant in the impugned order dated 27.09.2023 passed by him under Section 143(3) r.w.s. 144C(13) of the Act. 2. BECAUSE there being no dispute that the overall Investment made in the Purchase of flat by the appellant out of consideration received by him on sale of Property situated at 33, Dayanand Marg, Allahabad, aggregated to Rs.5,51,25,000/-, denial of deduction of IT(IT)A No.362/LKW/2023 Page 2 of 4 Rs.26,25,000/under section 54 of the Act merely on the alleged ground of late payment of the same to the builder is wholly unjustified. 3. BECAUSE the investment towards purchase of flat out of sale proceeds of capital assets having been made within the specified time limit provided under section 54 of the Act, for claiming deduction under the said section, delay of 2 months, If any, although not accepted, in making payment to the builder towards purchase of said flat, after due date of filing of return without depositing the same in Capital Gain Account Scheme, will not disentitle the appellant from claiming benefit of Rs.26,25,000/under section 54 out of overall Capital Gain of Rs.9,96,51,334/during the year under consideration. 4. BECAUSE the Assessing Officer has erred in law on facts in observing that the appellant was not having intention to make payment of Rs.26,25,000/to the builder towards the purchase of flat as he has already issued the cheque for the said amount within the specified time limit provided under section 54 of the Act and the said cheque having not been dishonoured by the bank. 5. BECAUSE the Assessing Officer has erred in law in not considering the Judgments relied upon by the appellant on the issue of admissibility of deduction under section 54 of the Act on late payment towards purchase of property, as alleged non-compliance under section 54(2) Is merely a procedural requirement and the same cannot itself stand In the way of the assessee In getting benefit of section 54 of the Act, If the conditions laid down under section 54(1) had been complied with. 6. BECAUSE, without prejudice to the aforesaid grounds, there being No dispute of the fact that the appellant had Issued cheque dated 29.12.2021 to the builder of Rs.26,25,000/towards purchase of flat, the sald cheque having been Presented for payment within the time limit for clearance of cheque under Negotiable Instruments Act, 1881 and the said cheque having been cleared, no way adverse view could have been taken by the Assessing Officer on the basis of insufficient fund in the bank account out of which the cheque was issued as the appellant was having sufficient funds in other bank accounts as also with the builder itself. 7. BECAUSE order appealed against, is contrary to facts, law and principles of natural justice.” (2) At the time of hearing, the Ld. Authorized Representative (“Ld. AR”, for short) for the assessee informed us that the assessee has opted to settle the aforementioned appeal under Direct Tax Vivad se Vishwas Scheme, 2024 (“DTVSVS”, for short) and that the Designated Authority has already issued Form-2 under DTVSVS, 2024. He also drew our attention to letter dated 26.02.2025 sent to Income Tax Appellate Tribunal (“ITAT”, for IT(IT)A No.362/LKW/2023 Page 3 of 4 short) by email, in this regard. Copy of Form -2 issued by Designated Authority under DTVSVS was also enclosed with the aforesaid letter. Ld. Departmental Representative (“DR”, for short) for Revenue has no objection for withdrawal of the appeal. After due consideration and in view of the foregoing, we are of the opinion that this appeal has become infructuous on account of aforesaid DTVSVS, and this appeal may be treated as withdrawn on account of the aforesaid DTVSVS. Accordingly, this appeal having become infructuous, is treated as withdrawn and is hereby dismissed. (2.1) Before we part, we hereby clarify, by way of abundant caution, that if for some reason the disputes under this appeal before us are not settled under the aforesaid DTVSVS, then the assessee will be at liberty to approach ITAT for restoration of this appeal in accordance with law. In the result, the appeal of the assessee is dismissed. Order pronounced in the open Court on 03/03/2025. Sd/- Sd/- [SUDHANSHU SRIVASTAVA] [ANADEE NATH MISSHRA] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 03/03/2025 Vijay Pal Singh, (Sr. PS) IT(IT)A No.362/LKW/2023 Page 4 of 4 Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. DR 5. Guard file By order //True Copy// Assistant Registrar "