JOHAR HASAN ZOJWALLA,KALYAN V. PR. COMM. OF INCOME TAX, THANE-1, THANE

ITA 3121/MUM/2025

AI Insights

The case involves Johar Hasan Zojwalla, a proprietor of M/s. Sab Realty, who appealed against the order of the Principal Commissioner of Income Tax, Thane-1. The Principal Commissioner had set aside the assessment made by the Assessing Officer under Section 143(3) read with Section 144B of the Income Tax Act, 1961, claiming it to be erroneous and prejudicial to the interest of the revenue. The dispute centered on the applicability of Section 56(2)(x)(b)(B) and Section 50C to a property transaction that occurred in a different assessment year than the one under consideration. The Tribunal, after reviewing the facts, concluded that the Principal Commissioner's assumption of jurisdiction was based on a wrong appreciation of facts, leading to the setting aside of the impugned order.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 652665 (ITAT-MUMBAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-06-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Assessment Year: 2021-2022
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KAVITA P. KAUSHIK; DR
• Assessee Lawyers: SUBODH RATNAPARKHI; AR
• Keywords: Sale consideration of property below Jantri Value; Revision of order
• Section: 143(3); 263; 50C

Judgement Text

" | आयकर अपीलीय अिधकरण ा यपीठ, मुंबई | IN THE INCOME TAX APPELLATE TRIBUNAL “F” BENCH, MUMBAI BEFORE SHRI SAKTIJIT DEY, HON’BLE VICE PRESIDENT & SHRI NARENDRA KUMAR BILLAIYA, HON’BLE ACCOUNTANT MEMBER I.T.A. No. 3121/Mum/2025 Assessment Year: 2021-22 Johar Hasan Zojwalla 1st Floor, Rani Mansion Murbad Road Kalyan (W), Dist. Thane Maharashtra - 421301 [PAN: AAAPZ5650K] Vs Pr. Comm. of Income Tax, Thane-1 अपीला थ\u0016/ (Appellant) \u0017\u0018 यथ\u0016/ (Respondent) Assessee by : Shri Subodh Ratnaparkhi, A/R Revenue by : Ms. Kavita P. Kaushik, Sr. D/R सुनवाई की तारीख/Date of Hearing : 12/06/2025 घोषणा की तारीख /Date of Pronouncement: 17/06/2025 आदेश/O R D E R PER NARENDRA KUMAR BILLAIYA, AM: This appeal by the assessee is preferred against the order of the ld. Principal Commissioner of Income Tax, Thane - 1 [hereinafter “the ld. Pr. CIT”] dated 27/03/2025 framed u/s 263 of the Act. 2. The grievance of the assessee is as under:- “1. The Hon. Pr. CIT erred in holding the order framed by the ld. AO u/s 143(3) r.w.s. 144B of the I. Tax Act on 26.12.2022, to be erroneous and prejudicial to the interest of revenue and accordingly the assumption of jurisdiction by the Hon. Pr. CIT u/s 263 of the I.T Act, 1961 is unjustified and therefore not valid. 2. The Hon. Pr. CIT erred in setting aside to the file of the assessing officer, the assessment framed u/s 143 (3) r.w.s. 144B of the I. Tax Act, 1961 on 26.12.2022, by relying upon the provisions of sec. 263 of the I. Tax Act, 1961, directing the Id AO to examine the applicability of section 56(2)(x)(b)(B)/section 50C to the transaction of purchase of flat no.3602 at Planet Godrej, Mahalaxmi (E), Mumbai vide agreement dt.03.08.2021, when undisputedly the said transaction of purchase of residential flat does not fall in the previous year relevant to AY 2021-22 but falls in AY 2022-23 and therefore the Hon. Pr. CIT is in error in setting aside the assessment I.T.A. No. 3121/Mum/2025 2 for AY 2021-22. The appellant prays that the order u/s 263 dt.29.03.2019 be held to be bad-in-law and quashed. 3. The appellant craves leave to add, alter, amend and/or vary any of the grounds at any time before the decision of the appeal.” 3. Representatives of both the sides were heard at length, case records carefully perused and the relevant documentary evidence brought on record duly considered in the light of Rule 18(6) of the ITAT Rules, 1963. 4. Briefly stated the facts of the case are that the assessee is a proprietor of M/s. Sab Realty engaged in real estate business. The assessee filed its return of income on 15/03/2022 declaring total income at Rs.4,20,31,010/-. The return was selected for scrutiny assessment and assessment order was framed on 26/12/2022 u/s 143(3) r.w.s. 144B of the Act after making an addition of Rs. 6,03,81,465/- by disallowing the claim of deduction u/s 80IBA of the Act. 5. Assuming jurisdiction conferred upon him by the provisions of Section 263 of the Act, the ld. Pr. CIT vide notice dated 06/03/2025, asked the assessee to showcause why the assessment order dated 26/12/2022 be not treated as erroneous and prejudicial to the interest of the revenue. The showcause notice reads as under:- ***This space has been left blank intentionally; P.T.O.*** I.T.A. No. 3121/Mum/2025 3 I.T.A. No. 3121/Mum/2025 4 6. We have given a thoughtful consideration to the aforementioned showcause notice. After going through the facts on record, we are of the considered view that the ld. Pr. CIT has assumed jurisdiction on wrong appreciation of facts. The impugned property was purchased by the assessee on 03/08/2021 falling in FY 2021-22 relevant to AY 2022-23 whereas the impugned assessment year is AY 2021-22. 7. All the apprehensions raised by the ld. Pr. CIT in justifying that the assessment order dated 26/12/2022 is erroneous and prejudicial to I.T.A. No. 3121/Mum/2025 5 the interest of the revenue may be relevant for AY 2022-23 and not for the year under consideration. Since the assumption of jurisdiction is based upon wrong appreciation of facts, we have no hesitation in setting aside the impugned order of the ld. Pr. CIT dated 27/03/2025 and restore that of the AO dated 26/12/2022. 8. In the result, appeal of the assessee is allowed. Order pronounced in the Court on 17th June, 2025 at Mumbai. Sd/- Sd/- (SAKTIJIT DEY) (NARENDRA KUMAR BILLAIYA) VICE PRESIDENT ACCOUNTANT MEMBER Mumbai, Dated 17/06/2025 *SC SrPs *SC SrPs *SC SrPs *SC SrPs आदेश की \u0014ितिलिप अ\u0019ेिषत /Copy of the Order forwarded to : 1. अपीलाथ\u001b / The Appellant 2. \u0014 थ\u001b / The Respondent 3. संबंिधत आयकर आयु! / Concerned Pr. CIT 4. आयकर आयु! ) अपील ( / The CIT(A)- 5. िवभागीय \u0014ितिनिध ,आयकर अपीलीय अिधकरण, मुंबई /DR,ITAT, Mumbai, 6. गाड% फाई/ Guard file. आदेशानुसार/ BY ORDER TRUE COPY Assistant Registrar आयकर अपीलीय अिधकरण ITAT, Mumbai "