JAGATHAMBAL,CHENNAI V. ITO, NCW-22(1), CHENNAI

ITA 613/CHNY/2025

AI Insights

The case involves an appeal by the assessee, Jagathambal, against the order of the Learned Commissioner of Income Tax, Appeal (CIT(A)), which confirmed the disallowance of a deduction claimed under section 54 of the Income-tax Act, 1961, amounting to Rs. 1,37,00,000, and the cost of improvement of Rs. 22,29,881. The disallowance was initially made by the Assessing Officer (AO) on the grounds that the capital gains were deposited beyond the prescribed time limit and that there was a lack of supporting documentary evidence for the cost of improvement. The CIT(A) upheld these disallowances in an ex parte order, noting the absence of substantial evidence from the assessee. The Tribunal found that the CIT(A) had not adequately adjudicated the issues or provided a proper opportunity to the assessee, leading to the decision to remand the case back to the CIT(A) for a fresh hearing.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 314118 (ITAT-CHENNAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-05-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2016-2017
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: M.P. GURUPRASAD
• Assessee Lawyers: VISHWA PADMANABHA; C.A
• Keywords: Capital Gains
• Section: 147; 144; 54

Judgement Text

"आयकर अपीलीय अिधकरण, ‘डी’ \u0011ा यपीठ, चे\u0016ई। IN THE INCOME TAX APPELLATE TRIBUNAL ‘D’ BENCH: CHENNAI \u0019ी यस यस िव ने रिव, \u0011ा ियक सद एवं \u0019ी जगदीश, लेखा सद क े सम( BEFORE SHRI SS VISWANETHRA RAVI, JUDICIAL MEMBER AND SHRI JAGADISH, ACCOUNTANT MEMBER आयकर अपील सं./ITA No.613/Chny/2025 िनधा :रण वष: /Assessment Year: 2016-17 Jagathambal, No.15/1, 3rd Street, Venkateshwara Nagar, Pozhichalur, Chennai – 600 074. [PAN: AXUPJ 0903G] Vs. The Income Tax Officer, Non Corporate Ward-22(1), Tambaram. (अपीलाथ\u0007/Appellant) (\b यथ\u0007/Respondent) अपीला थG की ओर से/ Appellant by : Shri Vishwa Padmanabha, C.A IJथG की ओर से /Respondent by : Shri M.P.Guruprasad, Addl. CIT सुनवा ई की ता रीख/Date of Hearing : 23.04.2025 घोषणा की ता रीख /Date of Pronouncement : 08.05.2025 आदेश / O R D E R PER JAGADISH, A.M : Aforesaid appeal filed by the assessee for Assessment Year (AY) 2016-17 arises out of the order of Learned Commissioner of Income Tax, Appeal (NFAC), Delhi [hereinafter “CIT(A)”] dated 17.01.2025 in the matter of assessment framed by Ld. Assessing Officer [AO] u/s. 147 r.w.s 144 r.w.s 144B of the Income-tax Act, 1961 (hereinafter “the Act”) dated 28.03.2022. ITA No.613/Chny/2025 :- 2 -: 2. The effective ground of appeal in this appeal of the assessee is against the disallowance of deduction claimed u/s. 54 of the Act of Rs. 1,37,00,000/- and cost of improvement of Rs. 22,29,881/-. 3. The assessee along with other six co-owners, sold a property at Survey No.52, Nemilchery, then Tambaram taluka now Alandur Taluka, Kancheepuram District, Tamil Nadu for sales consideration of Rs.14,50,00,000/ and claimed deduction u/s. 54 of the Act of Rs.1,37,00,000/- and cost of improvement of Rs.22,29,881/-. The A.O has disallowed the claim of deduction u/s. 54 of the Act on the ground that the assessee had deposited the capital gains beyond the prescribed time limit. The A.O has also disallowed the claim for the cost of improvement for lack of supporting documentary evidence. On appeal, the Ld. CIT(A) passed an ex parte order confirming the disallowance, stating that the assessee had failed to furnish any substantial evidence in support of the appeal. The Ld. CIT(A) also noted that no written submissions or documentary evidence were submitted. 4. At the outset, the Ld. Authorized Representative has submitted that the Ld. A.O/Ld. CIT(A) have passed the orders ex-parte without ITA No.613/Chny/2025 :- 3 -: any discussion on merits, therefore one more opportunity be granted to the assessee to substantiate his case before the Ld. CIT(A). 5. On the other hand, the Ld. Departmental Representative (DR), relied on the orders of lower authorities. 6. We have heard the rival submissions, and perused the materials available on record. It is noted that the Ld. CIT(A) has passed ex parte order without adjudicating the issues involved and without affording proper opportunity to the assessee. We, therefore, restore the matter back to the file of Ld. CIT(A) to adjudicate the appeal afresh, subject to payment of costs of Rs.5,000/-. The same shall be paid by the assessee to Tamil Nadu State Legal Services Authority at Hon’ble High Court of Madras within a period of one month from the date of receipt of this order and produce the receipt before the Ld. CIT(A). The Ld. CIT(A) shall pass a reasoned order after providing due opportunity of hearing to the assessee, in accordance with law. We also direct the assessee to co-operate with the proceedings and appear before the Ld. CIT(A) on the date of hearing without fail. In view of the above, the appeal filed by the assessee is allowed for statistical purposes only. ITA No.613/Chny/2025 :- 4 -: 7. In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced on 08th May, 2025. Sd/- Sd/- (यस यस िव ने रिव) (SS Viswanethra Ravi) \u0001याियक \u0001याियक \u0001याियक \u0001याियक सद\bय सद\bय सद\bय सद\bय / Judicial Member (जगदीश) (Jagadish) लेखा लेखा लेखा लेखा सद\u0011य सद\u0011य सद\u0011य सद\u0011य /Accountant Member चे\u0013नई/Chennai, \u0016दनांक/Dated: 08th May, 2025. EDN/- आदेश क\u0019 \bितिल प अ े षत/Copy to: 1. अपीलाथ\u0007/Appellant 2. \b थ\u0007/Respondent 3. आयकर आयु\u000f/CIT, Chennai 4. िवभागीय \bितिनिध/DR 5. गाड\u0018 फाईल/GF "