HARISH KUMAR,JAIPUR V. .NFAC, DELHI

ITA 1259/JPR/2024

AI Insights

The case involves Harish Kumar, the appellant, who was assessed for long-term capital gains by the AO due to the sale of immovable property, which he did not report in his income tax returns. The AO issued notices under sections 148 and 142(1) of the Income Tax Act, 1961, which the assessee failed to comply with, leading to an ex parte assessment. The CIT (A) upheld the AO's decision, prompting the assessee to appeal to the Income Tax Appellate Tribunal. The Tribunal examined the validity of the notices, the assessment, and the additional evidence provided by the assessee, ultimately deciding in favor of the assessee by directing the deletion of the addition made.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 23935 (ITAT-JAIPUR)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-12-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: GAUTAM SINGH CHOUDHARY; LD
• Assessee Lawyers: ASHOK KUMAR GUPTA
• Keywords: Additional evidence; Capital Gains; Principle of natural justice
• Section: 148; 144; 142(1); 250; 139

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL JAIPUR BENCH “SMC”, JAIPUR BEFORE Dr. S. SEETHALAKSHMI, JUDICIAL MEMBER AND SHRI GAGAN GOYAL, ACCOUNTANT MEMBER ITA No. 1259/JPR/2024 (A.Y. 2011-12) Harish Kumar, 325 Rajeshwari Villa, ShankerNagar Kagdiwada, Brahampuri Jaipur MountRoad, Jaipur – 302002. PAN No.: AINPG 3710C ..... Appellant Vs. NFAC, Delhi ..... Respondent Appellant by : Mr. Ashok Kumar Gupta, Adv. Mr. S. L. Jain, Adv. &Mr. Sharwan Kumar Gupta, Adv., Ld. ARs Respondent by : Mr. Gautam Singh Choudhary, JCIT Ld. DR Date of hearing :10/12/2024 Date of pronouncement :16/12/2024 O R D E R PER GAGAN GOYAL, A.M: This appeal by assessee is directed against the order of NFAC, Delhi dated 23.08.2024 passed u/s. 250 of the Income Tax Act, 1961 (in short ‘the Act’) for A.Y. 2011-12. The assessee has raised the following grounds of appeal:- 1 The impugned order U/s. 147/143(3) of the Act dated 29/10/2018 as confirmed by the Ld. CIT(A) (NFAC), Initiation, assessment order as well as complete proceedings in respect thereto are illegal, bad in law for wants of jurisdiction, barred by limitation and various other reasons (grounds), against the provisions and contrary to the lawful procedure and real facts of the case hence complete proceedings and orders including assessment order are liable to be quashed. 2 The Id. CIT(A) has grossly erred in law as well as on the facts of the case in confirming the addition of Rs. 4,13,215/- made by the Ld. AO on account of Long Term Capital Gain, and also erred without bringing any cogent material and corroborative evidence and without considering the materials and explanations available on records in their true perspective andsense therefore the same may kindly be deleted in Toto, 3. The Ld. CIT(A) has grossly erred in law as well as on the facts of the case in confirming the addition as made by the Ld. AO without issuing specific show cause notice to the assessee before making such addition hence violation of natural justice therefore complete addition should be deleted in Toto. 4. The Ld. CIT (A) has grossly erred in law and facts in rejecting the additional evidence application of the assessee without considering the material available on record in their true perspective and sense. 5. The Ld. CIT (A) has grossly erred in law and facts in rejecting the specific request as made by the assessee during the course of appellate proceeding for virtual hearing led to violation of natural justice. 6. The Ld. CIT (A) has grossly erred in law and facts in confirming the order of Ld.AO without considering the facts as undertaken by the assessee on Affidavit led to serious flaws of law as well as settled legal position of Hon'ble Apex court through various judgements. 7. The Id. AO has grossly erred in law as well as on the facts of the case in charging the interest u/s. 234A, B and C of the Act. The interest so charged is being totally contrary to the provision of law and on facts of the case and hence same may kindly be deleted in full. 8. That the appellant prays your honour indulgences to add, amend or alter of or any of the grounds of the appeal on or before the date of hearing.” 2. The brief facts of the case are that the assessee individual was amongst the category of non-filers, he did not filed his return of income for the year under consideration neither u/s. 139 of the Act nor u/s. 148 of the Act. The revenue was in the possession of the information that the assessee has sold immovable property amounting to Rs. 7.25 Lacs (DLC value of the same was 8, 91,995/-). Based on this information a notice u/s. 148 of the Act was issued vide dated: 28.03.2018 and on change of incumbent another notice was also issued on 04.07.2018 and on non-compliance of the same final notice was issued on 06.08.2018. 3. The assessee neither filed his return nor complied with any notice issued u/s. 142(1) of the Act. Finally, the case of the assessee was assessed u/s. 144 r.w.s. 147 of the Act vide dated: 29.10.2018 at a figure of Rs. 5, 41,995/- under the head long term capital gains. The assessee being aggrieved with the same preferred an appeal before the Ld. CIT (A), who in turn confirmed the order of the AO. The assessee being further aggrieved preferred the present appeal before us. We have gone through the order of the AO, order of the Ld. CIT (A) and submissions of the assessee alongwith grounds taken before us. 4. It is observed that the assessee has taken as much as seven grounds before us. Ground No. 1 challenges the validity of the order on the ground of being time barred. It is observed during the hearing of the matter that this ground of the assessee is not tenable as the notice issued is well within the time and there is no violation found of section 148 and 149 of the Act. On our view expressed during the hearing of the matter, both the sides were agreed and there is no challenge to this fact. Hence, Ground No. 1 raised by the assessee is dismissed as not tenable in law and facts. 5. It is observed through the will of the assessee’s sister vide page no. 49 to 54 that the assessee acquired the same through the will vide dated: 23.11.1991. The total area of the plot was 200 Sq. Yds. and the sister of the assessee herself constructed Two Rooms, Corridor, Kitchen, Toilet and Bathroom etc. This fact of construction is not under challenge as demonstrated in the sale deed also. The ground floor and first floor of the plot was duly constructed by the sister of the assessee and the assessee himself in the year 2008-09 respectively. Total built up area of the plot was 991 Sq. Fts. The assessee incurred total Rs. 2,51,407/-during the F.Y. 2008-09 and previous cost incurred by the assessee’s sister was Rs. 71,269/-, i.e. the assessee claimed total cost at Rs. 3,22,676/- (2,51,407/- + 71,269/-). The valuer appointed by the assessee valued the same at Rs. 5, 85,549/-. The total indexed cost/improvement value as per the assessee comes to Rs. 4, 76,626/- and cost of new asset acquired by the assessee was Rs. 3, 50,000/-, i.e. total of Rs. 8, 26,626/-. In that case even if one assumed the value of the property at Rs. 8, 91,995/-, there is no liability of tax is there on the assessee as remaining amount (Rs. 8, 91,995/- (-) Rs. 8, 26,626/- = Rs. 65,369/-) is below taxable. 6. Relevant documents to derive the real income were produced by the assessee before the Ld. CIT (A), but he chosen not to deal with the same and totally ignored by him. Although it was alleged by the Ld. CIT (A) that on additional evidences produced by the assessee, a remand report was called from the office of the AO, but the assessee never responded to the same, hence the same can’t be relied upon. Technically the version of the Ld. CIT (A) looks to be fair but considering the will of the assessee’s sister and sale deed executed by the assessee, we are of the considered opinion that cost/improvement value claimed by the assessee is reasonable and based on the construction of the house itself, registration charges were also paid by the assessee to the registrar. 7. Secondly, all the documents were produced before us by the assessee and looking at the amount involved overall facts of the case, we do not find it reasonable to restore the matter back to the file of the AO. It will be an utter wastage of time and resources of the revenue and the assessee both. Hence accepting the same, we direct the AO to delete the addition made and grounds taken by the assessee are allowed. 8. In the result, the appeal of the assessee is allowed. Order pronounced in the open court on 16th day of December 2024. Sd/- Sd/- (Dr. S. SEETHALAKSHMI) (GAGAN GOYAL) JUDICIAL MEMBER ACCOUNTANT MEMBER Jaipur, िदनांक/Dated: 16/12/2024 Copy of the Order forwarded to: 1. अपीलाथ\r/The Appellant , 2. \u000eितवादी/ The Respondent. 3. आयकर आयु\u0015 CIT 4. िवभागीय \u000eितिनिध, आय.अपी.अिध., Sr.DR., ITAT, 5. गाड\u001e फाइल/Guard file. BY ORDER, //True Copy// (Asstt. Registrar) ITAT, Jaipur Details Date Initials Designation 1 Draft dictated on PC on 16.12.2024 Sr.PS/PS 2 Draft Placed before author 16.12.2024 Sr.PS/PS 3 Draft proposed & placed before the Second Member JM/AM 4 Draft discussed/approved by Second Member JM/AM 5. Approved Draft comes to the Sr.PS/PS Sr.PS/PS 6. Kept for pronouncement on Sr.PS/PS 7. File sent to the Bench Clerk Sr.PS/PS 8 Date on which the file goes to the Head clerk 9 Date of Dispatch of order "