Rajendra Kumar Saluja, Kanpur V. Income Tax officer 2(3), Kanpur

ITA 111/LKW/2023

AI Insights

The case involves Rajendra Kumar Saluja, the appellant, who contested the order of the National Faceless Appeal Centre (NFAC) which confirmed the addition of a long-term capital gain of Rs.1,11,51,900 to his income for the Assessment Year 2012-13. This addition was based on the discrepancy between the sale consideration of a property reported by the assessee and its stamp duty valuation. The NFAC dismissed the appeal due to non-compliance with procedural requirements, as the assessee failed to respond to multiple notices. The Tribunal found that the non-compliance was due to the death of the assessee's advocate, who managed his tax affairs, and thus restored the case to the NFAC for a fresh hearing.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 123019 (ITAT-LUCKNOW)
• Duration Of Justice: 6 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-10-2023
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: B
• Next Hearing Date: 11-10-2023
• Assessment Year: 2012-2013
• Appeal Filed On: 09-04-2023
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: SAMEER JAIN
• Keywords: Capital Gains
• Section: 148; 144; 142(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 ITA No.111/Lkw/2023 Assessment Year: 2012-13 Rajendra Kumar Saluja, 125/23/1 Block No.3, Govind Nagar, Kanpur-208006 PAN: BSVPS 6209M Vs. Income Tax Officer-2(3), Kanpur (Appellant) (Respondent) O R D E R PER SUDHANSHU SRIVASTAVA, J.M.: This appeal has been preferred by the assessee against the order dated 10.02.2023 passed by the National Faceless Appeal Centre (NFAC), Delhi for Assessment Year (AY) 2012-13. 2. The brief facts of the case are that the Department was in possession of certain information that the assessee had sold immovable property for a total consideration of Rs.45,00,000/- whereas, the value of the property as per the stamp duty valuation was Rs.1,15,52,000/-. Accordingly, proceedings u/s.147 of the Income Tax Act, 1961 (hereinafter called ‘the Act’) were initiated and the statutory notice u/s. 148 of the Act was issued. However, Appellant by Shri Sameer Jain, FCA Respondent by Shri Sanjeev Krishna Sharma, Addl. CIT (DR) Date of hearing 12/10/2023 Date of pronouncement 17/10/2023 I.T.A. No.111/Lkw/2023 2 the said notice was returned unserved. Thereafter, another notice was dispatched but as per the assessment order, the assessee neither filed any return of income in compliance to the said notice nor furnished any explanation. Subsequently, the assessee also failed to respond to notice issued u/s. 142(1) of the Act. Thereafter, show cause notice u/s. 144 of the Act was issued and served upon the assessee requiring the assessee to submit the income tax return as well as furnish the requisite documents/evidences with regard to sale of immovable property. This notice also remained uncomplied with. Thereafter, final opportunity was provided to the assessee to show cause as to why the entire circle value of Rs.1,11,51,900/- ( as per sale deed) may not be treated as capital gains arising out of sale of property but again the assessee neither responded nor submit the Income Tax Return. Therefore, the Assessing Officer proceeded to treat the entire circle value of the immovable property amounting to Rs.1,11,51,900/- as long term capital gain and the same was added to the income of the assessee and the assessment was completed u/s. 144 r.w.s. 147 of the Act. 3. Aggrieved, the assessee approached the ld. First Appellate Authority challenging the addition. However, the appeal of the assessee came to be dismissed by the NFAC for the reason of non- I.T.A. No.111/Lkw/2023 3 compliance. The NFAC, while dismissing the appeal, has noted that during the course of appellate proceedings, no proper submissions had been filed and no agreement or purchase details of the property had been given. It has been further mentioned that the method of indexation had not been provided and, therefore, in absence of proper submission, duly supported by agreement of purchase and the sale, bank account details, indexation working etc., the addition made by the Assessing Officer was to be confirmed. 4. Now, the assessee has approached this Tribunal challenging the action of dismissal of his appeal by the NFAC by raising the following grounds of appeal: “The appellate order whereby led CITA has sustained the assessment order impugned before him is illegal, unwarranted, unjustified and as thus deserves to be quashed under law in the facts and circumstances of the case because:- 1. Learned CIT(A) was not justified in confirming the assessment order passed u/s 147/144 of The Income Tax Act, 1961 on exparte basis under law in the facts and circumstances of the case. In any case and without prejudice 2. While sustaining the impugned assessment order learned CIT(A) has grossly earned in confirming the order u/s 144/147 of the I.T. Act, 1961 for the captioned assessment year. I.T.A. No.111/Lkw/2023 4 3. While sustaining the impugned assessment order learned CIT(A) has again failed to appreciate that the notice u/s 148 read with section 147 had been issued on the basis of AIR information. 4. Learned CIT(A) has again failed to appreciate that capital gain arising was only Rs.26384/- and computation was furnished alongwith grounds of appeal before CIT(A). 5. While sustaining the impugned assessment order learned CIT(A) has again failed to appreciate that order as passed by learned assessing officer is not at all in law and uncalled for.” 5. The ld. Authorized Representative submitted that the reason for non compliance by the assessee both during the course of assessment proceedings as well as before the first appellate proceedings was that the assessee’s affairs relating to the income tax were being looked after by one Advocate Shri Prakhar Agnihotri. It was further submitted that unfortunately Shri Prakhar Agnihotri passed away on 28.09.2021. It was further submitted that the appeal before the NFAC was filed on 11.01.2020 and while filing the said appeal the e-mail I.D. had been mentioned as [e-mail] (in Form- 35) which was solely operated by Shri Prakhar Agnihotri. It was further submitted that, therefore, the notices did not come to the notice of the assessee when they were issued by the NFAC. It was submitted that it was on receipt of SMS on the mobile of I.T.A. No.111/Lkw/2023 5 the assessee from the Income Tax Department that the assessee approached the father of late Shri Prakhar Agnihotri, who in turn informed the assessee about the ex-parte order passed by the NFAC. The ld. Authorized Representative also drew our attention to the copy of the Death Certificate of the counsel as well as affidavit submitted by the assessee in this regard and prayed that the non compliance on part of the assessee was beyond the control of the assessee and, therefore, the assessee should be given an opportunity to explain his case before the ld. First Appellate Authority. 6. The ld. Senior Departmental Representative had no objection if the appeal was restored to the file of the ld. First Appellate Authority. 7. Having heard both the parties and after having gone through the records, it is seen that the assessee has duly explained the reason for non compliance before the ld. First Appellate Authority and, therefore, on the facts of this case, he deserves another opportunity. Accordingly, we restore this file to the NFAC with the direction to re-adjudicate the issue after providing the assessee proper opportunity to present his case. We also instruct the assessee to intimate the NFAC about the I.T.A. No.111/Lkw/2023 6 correct e-mail I.D. on which the communication from the NFAC should now be sent to the assessee. 8. In the final result, appeal of the assessee stands partly allowed for statistical purposes. (Order pronounced in the open court on 17/10/2023) Sd/- Sd/- (ANADEE NATH MISSHRA ) (SUDHANSHU SRIVASTAVA) Accountant Member Judicial Member Dated: 17/10/2023 Aks Copy of the order forwarded to : 1. The Appellant 2. The Respondent. 3. Concerned CIT 4. The CIT(A) 5. D.R., I.T.A.T., Lucknow Asstt. Registrar