BHAGWAN BHAIRU BADRE,MUMBAI V. WARD 42(1)(1), MUMBAI, KAUTILYA BHAVAN, MUMBAI

ITA 1692/MUM/2025

AI Insights

The case involves Bhagwan Bhairu Badre, the Appellant, contesting an order by the Income Tax Officer which added INR 8,22,350 as long-term capital gains for the Assessment Year 2014-2015. The Appellant's appeal to the CIT(A) was dismissed on grounds of non-prosecution, as the CIT(A) failed to consider the physical submissions made by the Appellant. The Appellant argued that the transaction related to the capital gains was legally invalid due to ongoing litigation and a stay order from the Bombay High Court, which was later vacated. The Tribunal found procedural errors in the CIT(A)'s handling of the appeal and directed a fresh hearing.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 312389 (ITAT-MUMBAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-04-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Assessment Year: 2014-2015
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: ASSESSEE; INVOKING PROVISIONS CONTAINED
• Keywords: Set aside; Opportunity of being heard; Additional evidence; Sale consideration of property below Jantri Value; Capital Gains
• Section: 143(3); 50C

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL “H (SMC)” BENCH, MUMBAI SHRI OM PRAKASH KANT, ACCOUNTANT MEMBER SHRI RAHUL CHAUDHARY, JUDICIAL MEMBER ITA No.1692/MUM/2025 (Assessment Year: 2014-2015) Bhagwan Bhairu Badre Room No.2003, Siddhi Vinayak Tower, CST Road, Anand Nagar, Dahisar (East) -400068. Maharashtra. [PAN:AFAPB3471P] .…………. Appellant Income Tax Officer Ward 42(1)(1), Mumbai G Block, Bandra Kurla Complex, Bandra East, Mumbai – 400051, Maharashtra. Vs …………. Respondent Appearance For the Appellant/Assessee For the Respondent/Department : : Shri Bhavin Solanki Shri Akhatar Hussain Ansari Date Conclusion of hearing Pronouncement of order : : 23.04.2025 30.04.2025 O R D E R [ Per Rahul Chaudhary, Judicial Member: 1. The present appeal preferred by the Assessee is directed against the order, dated 09/01/2025, passed by the Additional/Joint Commissioner of Income Tax (Appeals), Raipur [hereinafter referred to as ‘the CIT(A)’] under Section 250 of the Income Tax Act, 1961 [hereinafter referred to as ‘the Act’] whereby the Ld. CIT(A) had dismissed the appeal against the Assessment Order, dated 19/12/2016, passed under Section 143(3) of the Act for the Assessment Year 2014-2015. 2. The Assessee has raised following grounds of appeal : “1. Dismissal of the appeal is Unjustified and Erroneous in ITA No.1692/Mum/2025 Assessment Year 2014-2015 2 Law 1.1. On the facts and the circumstances of the case and in law, the Ld. CIT(A) erred in dismissing the appeal on the grounds that the Appellant was not interested in pursuing the matter. 1.2. The Ld. CIT(A) failed to duly consider the submissions made by the Appellant provided through the letter dated 27.12.2018, the letter dated 08.01.2019, and the subsequent submission dated 28.02.2019, which included a prayer for the admission of additional evidence. 1.3. The Ld. CIT(A) was also not justified in dismissing the appeal without calling for a remand report from the Ld. Assessing Officer regarding the prayer for the admission of additional evidence. Furthermore, the Ld. CIT(A) failed to consider the evidence submitted by the Assessee in his submission dated 08.01.2019, which was duly filed at the office of the then Ld. CIT(A) on 11.01.2019. 1.4. The Appellant respectfully submits that the dismissal of the appeal is unjustified and should not stand. 2. Legal Dispute Regarding the Validity of the Deed of Conveyance 2.1. On the facts and circumstances of the case, as well as in law, the learned CIT(A) erred in upholding the addition of Rs. 8,22,350 as long-term capital gains on the transfer of development rights to Shri Anilkumar Jain (Proprietor of M/s. Vijeet Developers) 2.2. The learned CIT(A) failed to adequately consider the lack of reasonable possibility of realizing this income, given the ongoing legal dispute between the Society and the Appellant concerning the Conveyance of Land, which has been ongoing since 2007. The Appellant had lost the case before the City Civil Court, which passed its order on 27.12.2011 2.3. The Appellant, along with other family members, appealed to the Hon'ble Bombay High Court (Suit No. 1703 of 2013) and obtained a stay against the City Civil Court's order. However, by the order dated 01.09.2023, the stay granted by the Hon'ble Bombay High Court was vacated. 2.4. Since no further appeal has been filed against the order dated 01.09.2023, the order of the City Civil Court dated ITA No.1692/Mum/2025 Assessment Year 2014-2015 3 22.12.2011 has attained finality. Therefore, any transfer by the Badre family to any party other than Dahisar Darshan Co- Op Housing Society Ltd. is not permissible under the City Civil Court's order and is legally invalid. 2.5. In light of this, the transaction between the Badre family and Shri Anilkumar Jain, proprietor of M/s Vijeet Developers, is null and void, and as such, no tax can be levied on this transaction. 2.6. The Appellant respectfully prays that the addition of Rs. 8,22,350 under the head \"Long-Term Capital Gains\" be deleted.” 3. We have heard the rival submissions and have perused the material on record. 4. The relevant facts in brief are that for the Assessment Year 2014- 2015, the Assessee filed return of income on 10/10/2014 declaring total income of INR.4,66,100/- which was picked up for regular scrutiny. Assessment under Section 143(3) of the Act was framed on the Assessee vide Assessment Order dated 19/12/2016 after making addition of INR.8,22,350/- holding the same to be Long Term Capital Gain in the hands of the Assessee by invoking provisions contained in Section 50C of the Act. 5. Being aggrieved, the Assessee preferred the appeal before CIT(A), which was dismissed vide order dated 09/01/2025. 6. Being aggrieved, the Assessee has preferred the present appeal before the Tribunal on the grounds reproduced at paragraph 2 above. 7. On perusal of record it emerges that the appeal preferred by the Assessee was dismissed by the CIT(A) on the ground of non–prosecution. On perusal of Paragraph 1 of the order passed by the CIT(A), we find that appeal was filed in physical form and thereafter, the same was migrated under E-Appeal Scheme 2023. ITA No.1692/Mum/2025 Assessment Year 2014-2015 4 During the course of hearing the Learned Authorized Representative for the Assessee had placed on record submission, dated 27/12/2018, 08/01/2019 and 28/02/2019 filed before the CIT(A) in physical form. However, on perusal of the order impugned, we find that the CIT(A) has recorded that no submissions were filed by the Assessee. Thus, the submissions filed by the Assessee in physical form were not taken into consideration by the CIT(A) while adjudicating the appeal. In view of the aforesaid facts and circumstances, we deemed it appropriate to accept the contention of the Assessee to set aside the order, dated 09/01/2025, passed by the learned CIT(A) with the directions to adjudicate the appeal afresh as per law after granting Assessee an opportunity of being heard to the Assessee. The Assessee had also placed on record copy of orders passed by various courts in support of the contention that the transaction in relation to which Long Term Capital Gain has been brought to tax in the hands of the Assessee stood nullified. The Assessee is directed to place copy of submissions filed in physical form alongwith the copy of the aforesaid decisions of the court before the CIT(A). In terms of aforesaid, order dated 09/01/2025, passed by CIT(A) is set aside. Thus, Ground No. 1 to 1.4 raised by the Assessee are allowed, while Ground No.2 to 2.6 deal with the merits of the additions are dismissed as having been rendered infructuous. 8. In result, the present appeal preferred by the Assessee is allowed for statistical purposes. Order pronounced on 30.04.2025. Sd/- Sd/- (Om Prakash Kant) Accountant Member (Rahul Chaudhary) Judicial Member म ुंबई Mumbai; दिन ुंक Dated : 30.04.2025 Milan,LDC ITA No.1692/Mum/2025 Assessment Year 2014-2015 5 आदेश की प्रतितिति अग्रेतिि/Copy of the Order forwarded to : 1. अपील र्थी / The Appellant 2. प्रत्यर्थी / The Respondent. 3. आयकर आय क्त/ The CIT 4. प्रध न आयकर आय क्त / Pr.CIT 5. दिभ गीय प्रदिदनदध ,आयकर अपीलीय अदधकरण ,म ुंबई / DR, ITAT, Mumbai 6. ग र्ड फ ईल / Guard file. आिेश न स र/ BY ORDER, सत्य दपि प्रदि //True Copy// उप/सह यक पुंजीक र /(Dy./Asstt. Registrar) आयकर अपीलीय अदधकरण, म ुंबई / ITAT, Mumbai "