VISHWANATH KADIA SHETTY , MUMBAI V. ITO WARD-22(3)(5), MUMBAI

ITA 121/MUM/2023

AI Insights

The case involves two appeals filed by Vishwanath Kadia Shetty against the order of the CIT(A) which sustained additions made by the Assessing Officer (AO) under Section 50C of the Income Tax Act, 1961, related to the transfer of immovable property. The AO had revalued the property for tax purposes, leading to a significant increase in the assessed capital gains. The CIT(A) dismissed the appeals on the grounds of non-compliance, as the assessee did not respond to the notices, which were allegedly not received. The ITAT found that the assessee was not given a fair opportunity to be heard and thus remanded the case back to the CIT(A) for a decision on merits.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 130216 (ITAT-MUMBAI)
• Duration Of Justice: 2 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-03-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 12-03-2023
• Assessment Year: 2012-2013
• Appeal Filed On: 12-01-2023
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Sale consideration of property below Jantri Value; Capital asset
• Section: 148; 271(1)(c); 50C; 250; 274

Judgement Text

P a g e | 1 ITA Nos. 121 & 122/Mum/2023 Vishwanath Kadia Shetty vs. ACIT, Circle 22(3) IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, MUMBAI BEFORE SHRI ABY T VARKEY, JUDICIAL MEMBER & SHRI AMARJIT SINGH, ACCOUNTANT MEMBER ITA Nos. 121 & 122/Mum/2023 (A.Ys.2012-13 & 2014-15) Vishwanath Kadia Shetty 501, St. Sebestian Classic, Road No.3, Sunder Nagar, Kalina, Santacruz East, Mumbai – 400 098 Vs. ACIT, Circle 22(3) Piramal Chamber, Lower Parel, Mumbai – 400 013 स्थायी लेखा सं./जीआइआर सं./PAN/GIR No: AADPS5744G Appellant .. Respondent Appellant by : Shri Haridas Bhat Respondent by : Shri Bharat Andhale Date of Hearing 13.03.2023 Date of Pronouncement 17.03.2023 आदेश / O R D E R Per Amarjit Singh (AM): These two appeals filed by the assessee are directed against the common order of NFAC, Delhi, dated 26.12.2022. Since common issue on identical facts are involved in these two appeals filed by the assessee, therefore, these appeals are adjudicated together by taking ITA No. 121/Mum/2023 as lead case and its finding will be applied to ITA No. 122/Mum/2023 mutatis mutandis. ITA No.121/Mum/2023 “1. On the facts and circumstances of the Appellant's case and in law the Ld. Comm of Income Tax (Appeals) erred in passing the Order u/s 250 of the Income Tax Act, 1961 without affording reasonable opportunity of being heard. P a g e | 2 ITA Nos. 121 & 122/Mum/2023 Vishwanath Kadia Shetty vs. ACIT, Circle 22(3) 2. On the facts and circumstances of the Appellant's case and in law the Ld. Comm of Income Tax (Appeals) erred on the fact that the Notice for Hearing of Appeal dated 22.11.2022 and 08 12 2022 remained not replied for the reason that these Notice so issued were never intimated to the Appellant on the E Mail [e-mail] 3. On the facts and circumstances of the Appellant's case and in law the Ld. Comm of Income Tax (Appeals) erred in sustaining the Additions so made by the Ln AO to the tune of Rs.30,10,193/- u/s 50C of the IT Act, which was mere registration of transfer of property u/s 2(47) of the IT Act, whereas the beneficial ownership in property was transferred and possessioned on 06/09/2006 vide Partnership Deed. 4. On the facts and circumstances of the Appellant's case and in law the Ln Comm. Of Income Tax (Appeals) erred in sustaining of imposition of Penalty by the Ln AO u/s 271(1)(c) Av Sec 274 of the IT Act for Concealment of Income. 5. The Appellant craves leaves to alter, amend, withdraw or substitute any ground or grounds or to add any new ground or grounds of appeal on or before the hearing.” 2. The fact in brief is that return of income declaring total income of Rs.14,84,140/- was filed on 26.11.2011. The case of the assessee was reopened by issuing of notice u/s 148 of the Act on 15.07.2015. In this case the assessee had transferred immovable property for a consideration of Rs. 12 lac on 18.01.2012. On verification the A.O found that the stamp duty valuation authorities has valued the impugned property at Rs.1,00,89,500/- for the purpose of computation of levy of stamp duty on the transaction. The AO further stated that partner of the assessee Shri Hari Mittar Yadav and the assessee together had contributed Rs. 24 lac to purchase the said property in the year 2003. Accordingly, the A.O has computed the assesse’s share of capital gain in accordance with Sec. 50C of the Act to the amount of Rs.30,10,193/- and added to the total income of the assessee. 3. Aggrieved, the assessee filed the appeal before the ld. CIT(A). The ld. CIT(A) has dismissed the appeal on the ground that assessee has not made any compliance during the course of appellate proceedings. P a g e | 3 ITA Nos. 121 & 122/Mum/2023 Vishwanath Kadia Shetty vs. ACIT, Circle 22(3) 4. During the course of appellate proceedings before us the ld. Counsel contended that during the course of appellate proceedings before the ld. CIT(A) no notice of hearing was intimated to the assessee on the email ([e-mail]) provided by the assessee. Therefore, he submitted that ld. CIT(A) has not given any opportunity of being heard to the assessee before deciding the appeal. On the other hand, the ld. D.R supported the order of lower authorities. 5. Heard both the sides and perused the material on record. Sec.250(6) of the I.T. Act contemplates that ld. CIT(A) would determine point in dispute and therefore, record reasons on such point in support of his conclusion. However the ld. CIT(A) has not adjudicated the appeal of the assessee on merit. The ld. CIT(A) is required to adjudicate the appeal on merit after taking into consideration the material available in the assessment record. In the case of the assessee even the notice of hearing was not intimated to the assessee on the email id specifically provided by the assessee in the form no. 35 filed with the ld. CIT(A). In view of the above facts and circumstances we are of the view that assesse must be given opportunity of hearing at the level of ld. CIT(A). Therefore, we remind this matter back to the file of the ld. CIT(A) for adjudicating a fresh on merit, after affording due opportunity to the assesse. 6. The appeal of the assessee is allowed for statistical purposes. ITA No. 122/Mum/2023 7. As the facts and issues involved in this appeal is same in ITA No. 121/Mum/2023 as supra, therefore, applying the same findings mutatis mutandis this appeal of the assessee is also allowed. P a g e | 4 ITA Nos. 121 & 122/Mum/2023 Vishwanath Kadia Shetty vs. ACIT, Circle 22(3) 8. In the result, both appeals of the assessee are allowed for statistical purposes. Order pronounced in the open court on 17.03.2023 Sd/- Sd/- (Aby T Varkey) (Amarjit Singh) Judicial Member Accountant Member Place: Mumbai Date 17.03.2023 Rohit: PS आदेश की प्रतितिति अग्रेतिि/Copy of the Order forwarded to : 1. अपीलाथी / The Appellant 2. प्रत्यथी / The Respondent. 3. आयकर आयुक्त / CIT 4. विभागीय प्रविविवि, आयकर अपीलीय अविकरण DR, ITAT, Mumbai 5. गार्ड फाईल / Guard file. सत्यावपि प्रवि //True Copy// आदेशानुसार/ BY ORDER, उि/सहायक िंजीकार (Dy./Asstt. Registrar) आयकर अिीिीय अतिकरण/ ITAT, Bench, Mumbai.