Sh. Lachu Ram S/o Sh. Bajru Ram, New Shimla V. ITO, Ward -1, Shimla

ITA 616/CHANDI/2022

AI Insights

This case involves an appeal by Sh. Lachu Ram against the order of the National Faceless Appeal Centre (NFAC), which had dismissed his appeal concerning the reassessment of his income for the Assessment Year 2011-12. The reassessment was based on information received from the Income Tax Officer (Intelligence), Solan, leading to an addition of Rs.31,43,168 as Long Term Capital Gains under Section 50C(1) of the Income Tax Act, 1961. The NFAC dismissed the appeal due to the assessee's failure to provide necessary documents despite multiple notices. The ITAT, considering the circumstances and the assessee's possible lack of access to legal resources, decided to give another opportunity for the assessee to present his case.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 128426 (ITAT-CHANDIGARH)
• Duration Of Justice: 8 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-06-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 20-03-2023
• Assessment Year: 2011-2012
• Appeal Filed On: 06-09-2022
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Sale consideration of property below Jantri Value; Capital asset; Cost of acquisition; Capital Gains
• Section: 147; 144; 50C; 54F; 2(14); 142(1)

Judgement Text

आयकर अपीलȣय अͬधकरण,चÖडीगढ़ Ûयायपीठ,चÖडीगढ़ IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, “SMC”, CHANDIGARH BEFORE SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER & SHRI VIKRAM SINGH YADAV, ACCOUNTANT MEMBER आयकरअपीलसं./ITA No.616/CHD/2022 Ǔनधा[रणवष[ / Assessment Year :2011-12 Sh. Lachu Ram, S/o Shri Bajru Ram, Vilalge Patyog, New Shimla HP बनाम The ITO, Ward-1, Shimla èथायीलेखासं./PAN NO: AWBPR0823K अपीलाथȸ/Appellant Ĥ×यथȸ/Respondent Ǔनधा[ǐरतीकȧओरसे/Assessee by :Sh. Tej Mohan Singh, Advocate (proxy for Sh. Vishal Mohan, Sr. Advocate) राजèवकȧओरसे/ Revenue by : Sh. Pardeep Kumar, JCIT, Sr. DR स ु नवाईकȧतारȣख/Date of Hearing :21.03.2023 उदघोषणाकȧतारȣख/Date of Pronouncement : 06.06.2023 आदेश/Order Per Sudhanshu Srivastava, Judicial Member: This appeal is preferred by the assessee against order dated 11.08.2022 passed by the National Faceless Appeal Centre, (NFAC), Delhi for Assessment Year 2011-12. 2. The brief facts of the case are that in this case, the assessee’s case was reopened u/s. 147 of the Income Tax Act, 1961 (hereinafter called ‘the Act’) on the basis of information received from the Income Tax Officer ITA No. 616-Chd-2022 (A.Y. 2011-12) - Sh. Lachu Ram, New Shimla 2 (Intelligence), Solan. Thereafter, statutory notice u/s. 142(1) of the Act was issued and subsequently, the assessment was completed in terms of Section 144 r.w.s. 147 of the Act based on the written submission of the assessee at an income of Rs.32,93,168/- after making an addition of Rs.31,43,168/- on account of Long Term Capital Gains to be assessed after invoking provisions of Section 50C(1) of the Act. As per the Assessing Officer, the assessee alongwith two other co-owners, namely, Shri Munshi Ram and Shri Kripa Ram had sold his immovable property vide sale deed dated 22.05.2010 for consideration of Rs.20,79,990/-, whereas the value adopted for stamp duty purposes was Rs.94,30,581/- and 1/3 rd share of the assessee came to Rs.31,43,168/-. The Assessing Officer also noted that since the cost of acquisition of asset was not given by the assessee. The same was to be taken as NIL. 3. Aggrieved, the assessee approached the NFAC, but the assessee’s appeal came to be dismissed for the reason of the assessee not filing any documents before the NFAC in spite of five notices having been issued. Left with no option, the NFAC, in absence of any documentary evidence, dismissed the assessee’s appeal. The NFAC also directed the Assessing ITA No. 616-Chd-2022 (A.Y. 2011-12) - Sh. Lachu Ram, New Shimla 3 Officer to recompute the assessee’s income under the head Short Term Capital Gain. 4. Now, the assessee has approached this Tribunal, challenging the order of the NFAC by raising the following grounds of appeal: 1. That in the facts and circumstances of the case the Ld Commissioner of Income Tax (Appeals) is not justified in dismissing the appeal filed against the order u/s 144 of the Income Tax Act , 1961 without giving a proper opportunity of hearing to the assessee. 2. That in the facts and circumstances of the case the C1T (A) is not justified in upholding the reassessment u/s 148 of Income Tax Act 1961. 3. That in the facts and circumstances of the case the CIT(A) is not justified in upholding the treating of the property sold as a capital asset under section 2(14) of the Income Tax Act , 1961 and further adopting the consideration u/s 50C of the Income Tax Act 1961 at Rs. 31,43,168/-and treating the sale of the property as a short term capital gain. 4. That in the fact and 1 circumstances of the case the Ld Commissioner of Income Tax (Appeals) is not justified in upholding the cost of acquisition of property at Nil . The same is absolutely illegal and not sustainable in the eyes of law. 5. That in the facts and circumstances of the case the Ld Commissioner of Income Tax ( Appeals] isnot justified in upholding the non-allowing of deduction claimed under section 54F of the Income Tax Act, 1961. ITA No. 616-Chd-2022 (A.Y. 2011-12) - Sh. Lachu Ram, New Shimla 4 6. That the order of the Ld. CIT(A) is bad in law and facts. 5.0 At the time of hearing, an adjournment application was moved seeking adjournment. However, looking into the facts of the case, we deem it appropriate to reject the adjournment application and proceed to hear the appeal ex-parte qua the assessee. 6.0 A perusal of the impugned order shows that the assessee was given five opportunities by the NFAC to explain why the order of the Assessing Officer was incorrect and why the provisions of Section 50C(1) of the Act have been wrongly invoked. However, the assessee did not avail any of the opportunities provided and also failed to furnish any documentary evidence in support of his appeal. It is also seen that even before the Assessing Officer, the assessee did not make a strong case against invocation of Section 50C(1) of the Act. 7.0 However, looking into the facts of the case and also keeping in mind that the assessee belongs to a village and he might not be having the required documents and access to expert legal advice at that point of time, we are of the considered opinion that the assessee deserves another ITA No. 616-Chd-2022 (A.Y. 2011-12) - Sh. Lachu Ram, New Shimla 5 opportunity to explain and defend his case. Accordingly, we restore the appeal to the file of the Assessing Officer with the direction to readjudicate the issue after giving proper opportunity to the assessee to present his case. We also direct the assessee to properly avail the opportunity being granted to him by us at this juncture and fully cooperate during the set aside the assessment proceedings, failing which, the Assessing Officer shall be at liberty to decide the issue at hand ex-parte qua the assessee on merits and in accordance with law. 8.0 In the final result, the appeal of the assessee stands allowed for statistical purposes. (Order pronounced in the open Court on 06/06/2023) Sd/- Sd/- (VIKRAM SINGH YADAV) (SUDHANSHU SRIVASTAVA) Accountant Member Judicial Member Dated : 06.06.2023 Aks/- आदेशकȧĤǓतͧलͪपअĒेͪषत/ Copy of the order forwarded to : 1. अपीलाथȸ/ The Appellant 2. Ĥ×यथȸ/ The Respondent 3. आयकरआय ु Èत/ CIT 4. आयकरआय ु Èत (अपील)/ The CIT(A) 5. ͪवभागीयĤǓतǓनͬध, आयकरअपीलȣयआͬधकरण, चÖडीगढ़/ DR, ITAT, CHANDIGARH 6. गाड[फाईल/ Guard File आदेशान ु सार/ By order, ITA No. 616-Chd-2022 (A.Y. 2011-12) - Sh. Lachu Ram, New Shimla 6 सहायकपंजीकार/ Assistant Registrar