MEERA,JAAIPUR V. ITO WARD 7(1), JAAIPUR, JAIPUR

ITA 590/JPR/2025

AI Insights

The case revolves around an appeal by Meera Dhehara Wali Dhani against the order of the CIT(A) concerning the assessment year 2010-11. The primary contention was regarding the illegalities and procedural lapses in the orders passed under sections 147 and 144 of the Income Tax Act, 1961, including issues of jurisdiction, approval, and natural justice. The appellant challenged the addition of Rs. 18,53,310 as long-term capital gain on the sale of agricultural land, which was claimed to be exempt. The CIT(A) had set aside the assessment order for a fresh assessment, which the Tribunal found unnecessary as the details were already available and previously examined. The Tribunal also addressed the non-allowance of deduction under section 54B for the purchase of new assets and the charging of interest under sections 234A, 234B, and 234C.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 774172 (ITAT-JAIPUR)
• Duration Of Justice: 4 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-09-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 16-04-2025
• Other Referred Cases: Collector, Land Acquisition vs. Mst. Katiji and Others, 167 ITR 471 (SC), Gyan Chand Batra vs. ITO 133 TTJ 482(JP), ITO vs. Raj Kumar Parashar 192 TTJ 603(JP), Prakash Karnawal vs. ITO, Narangi Devi vs. ITO in ITA No.254/JP/2022
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: GAUTAM SINGH CHOUDHARY
• Assessee Lawyers: ASHOK KUMAR GUPTA
• Keywords: Set aside; Capital asset; Reasonable cause; Sale consideration of property below Jantri Value; Cost of acquisition; Capital Gains; Principle of natural justice; Competent authority
• Section: 147; 144; 54B; 54F; 234B; 50C

Judgement Text

"`vk;dj vihyh; vf/kdj.k] t;iqj U;k;ihB] t;iqj IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES,”SMC” JAIPUR Mk0 ,l- lhrky{eh] U;kf;d lnL; ,oa Jh jkBkSM+ deys'k t;UrHkkbZ] ys[kk lnL; ds le{k BEFORE: DR. S. SEETHALAKSHMI, JM & SHRI RATHOD KAMLESH JAYANTBHAI, AM vk;dj vihy la-@ITA. No. 590/JPR/2025 fu/kZkj.k o\"kZ@Assessment Years : 2010-11 Meera Dhehara Wali Dhani, Ramlyawala, Nangal Purohit, Amer, Jaipur. cuke Vs. The ITO, Ward-7(1), Jaipur. LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: ELPPM4116K vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksj ls@ Assessee by : Shri Ashok Kumar Gupta, Adv. jktLo dh vksj ls@ Revenue by : Shri Gautam Singh Choudhary, JCIT lquokbZ dh rkjh[k@ Date of Hearing : 26/06/2025 mn?kks\"k.kk dh rkjh[k@Date of Pronouncement : 09/09/2025 vkns'k@ ORDER PER DR. S. SEETHALAKSHMI, J.M. The assessee has filed this appeal challenging the impugned order dated 17.10.2024, passed by the learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi [ld. CIT(A)], for the assessment year 2010-11. 2. The assessee has raised following grounds:– “1. The impugned order u/s 147 r.w.s.144 of the I.T. Act, 1961 dated 29.11.2017 as well as the action or proceedings u/s 147/144 are illegal, bad in law, barred by limitation, without jurisdiction, without approval/ satisfaction from the proper or competent authority, invalid ex-pate order in gross breach of law and against the principle of natural justice and various other reasons Printed from counselvise.com ITA No. 590/JPR/2025 Meera, Jaipur 2 and contrary to the real facts of the case, hence the same make kindly be quashed. 2. The Ld.CIT(A) has grossly erred in law as well as on facts of the case in setting aside the assessment order to AO for making a fresh assessment without deciding our legal and other grounds of appeal when all the details were available before him and also was a covered matter by Hon’ble ITAT order in co-owner’s case and had already been examined by the Ld.AO and no new facts or material were to be filed by the assessee. Hence, the order of the Ld.CIT(A) is bad in law, and hence the same may kindly be quashed. 3. 1 Rs. 18,53,310/-: The ld.AO has grossly erred in law as well as on facts of the case in making the addition of Rs.18,53,310/- on account of Long term capital gain on sale of agricultural land which is otherwise exempt and the Ld.AO also erred in taking the higher value adopted by the Stamp authority in place of actual consideration mentioned in the sale deed and received by the assessee while determining the Long term capital gain and the Ld.CIT(A) has grossly erred in setting aside the same to the AO without considering the details and material, submission and Hon’ble ITAT order available before him. Hence the addition so made by the AO and set aside by the Ld.CIT(A) being totally contrary to the provisions of law and facts on record and hence the same may kindly be deleted in full. 3.2 The Ld. AO have grossly erred in law as well as on facts of the case in not allowing the deduction u/s 54B and the Ld.CIT(A) has grossly erred in setting aside the same to the AO on the purchase of the new assets for which the assessee is entitled and Hence the addition so made by the AO is totally contrary to the provisions of law and facts of the case and make kindly be deleted in full. 4. The ld.AO has grossly erred in law as well as on facts of the case, in charging interest u/s 234A,B,C. The interest so charged is totally contrary to the provisions of law and facts of the case and hence may kindly be deleted in full. 5. That the appellant prays your honour indulgences to add, amend or alter of or any of the grounds of the appeal on or before the date of hearing.” 3. During the course of hearing, the Registry has pointed out that there is a delay of 106 days in filing the present appeal before the Tribunal. The assessee has filed an application explaining the cause of such delay which is supported by an Affidavit. Printed from counselvise.com ITA No. 590/JPR/2025 Meera, Jaipur 3 4. We have gone through the averments made in the affidavit and thus, we are of the opinion that the assessee is prevented in filing the appeal in time and we are satisfied that the delay in filing the appeal is due to reasonable cause. Thus, the delay of 106 days in filing the appeal by the assessee is condoned in view of the decision of Hon'ble Supreme Court in the case of Collector, Land Acquisition vs. Mst. Katiji and Others, 167 ITR 471 (SC) as the assessee is prevented by sufficient cause. Consequently, we condone the delay of 106 days in filing the present appeal and admit the same for adjudication on merit. 5. Succinctly, the facts as culled out from the records are that the AO received information from the Director of Income tax(I&CI) Jaipur vide office letter No.DIT(I&CI)/JPR/50C/2013-14/3145 dated 21.02.2014, to the effect that the assessee, along with other members, i.e. Smt. Suji Devi W/o Shri Chhaju Ram and Smt. Santosh Devi, w/o Shri Sharwan R/o Ramalyawas, Tehsil-Amer, Jaipur had sold agriculture land measuring5.93 hectares at khasra number5295 in village/ patwari area/ land Record inspection area-Reengas, Tehsil Shrimadhopur, District-Sikar, to Skyway Colonizers, Jaipur, for a sale consideration of Rs.43,50,000/ through sale deed dated17.03.2010 which was executed by the Sub-registrar, Shrimadhopur. The Sub- registrar, Shrimadhopur, valued the cost of land at Rs.1,01,78,240/- as Printed from counselvise.com ITA No. 590/JPR/2025 Meera, Jaipur 4 per which the assessee's one-fourth share worked out to Rs.25,44,560/-. The AO further noted that no return of income was filed by the assessee disclosing long term capital gain earned by selling of the above immovable property. Thus, according to the AO, the case of the assessee is covered under the provisions of section 50C of the Income Tax Act. It is also observed by the AO that the assessee with 6 other partners had purchased the impugned property on 11.02.2005, for Rs.38,00,000/- and paid stamp duty of Rs.4,00,000/- thereupon, in which the assessee’s share being 1/8th is Rs.5,25,000/- In the case of the assessee, AO calculated the long term capital gain as under– Sale consideration (As per section 50C) Rs.25,44,560/- Less-Indexed cost of acquisition [525000x632/480] Rs. 6,91,250/- Long term capital gain Rs.18,53,310/- The AO did not allow the deduction u/s 54B claimed by the assessee and eventually assessed the income at Rs.18,53,310/- 6. Aggrieved from the order of Assessing Officer, the assessee preferred an appeal before the ld. CIT(A), NFAC. Apropos to the grounds so raised the ld. CIT(A) finding that the assessment order has been passed u/s 144 set aside the same, back to the AO for making a fresh assessment. Printed from counselvise.com ITA No. 590/JPR/2025 Meera, Jaipur 5 7. Feeling dissatisfied with the above finding of the ld. CIT(A) the assessee filed the present appeal before this tribunal on the grounds as reiterated herein above. To support the various grounds so raised by the ld. AR of the assessee and has relied upon the following evidences in support of the contentions so raised:- S. No. Particulars Page No. 1. Copy of purchase deed of the land 1-12 2. Copy of sale deed dt. 17.03.2010 13-25 3. Copy of sale deed dt. 10.02.2010 26-35 4. Copy of purchase deed for investment u/s 54B by Smt. Narangi Devi, Smt. Santosh Devi, Smt. Meera Devi and Smt. Nannchi Devi. 36-51 5. Copy of jamabandi 52-53 6. Copy of letter to AO in case of Smt. Meera Devi. 54-56 7. Copy of Khasra Girdawari 57 8. Copy of letter to AO in case of Smt. Meera Devi. 58-59 9. Copy of reate list of DLC rate by the Sub-Registrar Shrimadhopur in the year 2008-09 and 2009-10 60-65 10. Copy of letter to AO in case of Smt. Suji Devi. 66-68 11. Copy of purchase deed for investment u/s 54B/54 69-112 12. Copy of Khasra Girdawari 113 13. Copy of letter to AO in Prem/Ramji Lal, Bhagwati Devi 116-120 14. Copy of purchase deed for investment u/s 54B/54 121-135 S. No. Particulars Page No. 1. Copy of WS before the CIT(A) 1-18 2. Copy of add. WS to CIT(A) 19-21 3. Copy of 2nd WS to CIT(A) 22-23 4. Copy of ITAT order in Co-owner Smt. Naranji Devi. 24-60 5. Copy of CIT(A) order in Co-owner Smt. Bhagwati Devi. 61-99 8. Per contra, ld. DR relied on the orders of the lower authorities. 9. We have heard the rival contentions and perused the material placed on record, as well as the relevant provisions of law and the case Printed from counselvise.com ITA No. 590/JPR/2025 Meera, Jaipur 6 laws cited by the Ld.AR in support of his case. We find that during the assessment proceedings, the AR of the assessee had filed submissions and documents on 3 to 4 occasions, as mentioned by the AO himself, in his order. We also note the AO rejected the claim of the assessee as regards deduction u/s 54B holding it to be false. The order further shows that no penalty has been initiated by the AO for non-compliance of statutory notices. The order has been passed u/s 144 on account of absence of return by the assessee. The Ld. CIT(A) has wrongly concluded that the assessment order was passed ex-parte u/s 144, and thereby setting aside the case. Instead of deciding the case on the basis of submissions made and the evidence adduced, he set the assessment aside for fresh adjudication by the AO. The new amendment empowered the Commissioner (Appeals) to set aside assessments made u/s 144, which dealt with best judgment assessments, and refer these cases back to the Assessing Officer for a fresh evaluation. The instant assessment was not a case of Best Judgement assessment u/s 144. The assessee had provided all the details called for by the AO. In these circumstances, the powers of CIT(A) being coterminous with that of AO, it was expected of him, to adjudicate the case and not to pass it on over to the AO. We, set aside the action of the Ld.CIT(A) in restoring Printed from counselvise.com ITA No. 590/JPR/2025 Meera, Jaipur 7 the assessment back to the AO and allow Ground No.2 raised by the appellant. 10. We now take up Ground No.3 & 4 and proceed to adjudicate the same on the basis of submission and evidence produced by the assessee before the AO/CIT(A). The impugned land admeasuring 5.93 hectares was purchased by seven co-owners,[Suji Devi, Santosh Devi, Meera (the assessee), Prem Devi (W/o Rameshwar Lal), Bhagwati Devi, Prem Devi (W/o Ramji Lal) &Narangi Devi] in February, 2005(FY 2004-05) for a consideration of Rs.38,00,000/- An amount of Rs.4,00,000/- was further spent on its Stamps, registration and legal expenses. The share of all the co-owners in the property was one- eighth, except Suji Devi’s which was one-fourth. In March, 2010 (FY 2009-10), the assessee, along with two other co-owners (Santosh Devi and Suji Devi), sold one-half of the impugned land through Registered deed for a consideration of Rs.43,50,000/-, which was valued by the Sub-registrar at Rs.1,01,78,240/- The remaining half was sold by the other four co-owners [Prem Devi (W/o Rameshwar Lal), Bhagwati Devi, Prem Devi (W/o Ramji Lal) &Narangi Devi]for Rs.54,50,000/- (Valued by Sub-registrar at Rs.1,00,54,000/-)The sellers can be conveniently divided into two groups - Group-1 [Prem Devi (W/o Printed from counselvise.com ITA No. 590/JPR/2025 Meera, Jaipur 8 Rameshwar Lal), Bhagwati Devi, Prem Devi (W/o Ramji Lal) &Narangi Devi] and Group-2 [Suji Devi, Meera (the assessee) and Santosh Devi] All the co-owners further purchased agricultural land and claimed deduction u/s 54B. The AO, in the case of all the co-owners worked out Long term capital gain adopting the value as per 50C as the sale consideration. He did not allow the deduction claimed u/s 54B. 11. As far as the working of Long term capital gain is concerned, we do not find any infirmity in the action of the AO to that extent. Had there been no investment made by the assessee in the purchase of agricultural land, the assessee would have been liable to tax on LTCG of Rs.18,53,310/- But in the instant case, the assesseealong with three other co-owners purchased an agricultural land for a consideration of Rs.51,50,000/- on 11.10.2010 (share of each co-owner being equal, i.e. Rs.12,87,500/-) there is no claim u/s 54F, we need to discuss. Even we need to note para 2 of page 4 of assessment order. 12. Now, we need to address as to whether any taxable LTCG arose to the assessee, after being allowed deduction u/s 54F. It is an undisputed fact that the cost of the new asset purchased for claiming deduction u/s 54F is Rs.12,87,500/- In Explanation to section 54F(1), it Printed from counselvise.com ITA No. 590/JPR/2025 Meera, Jaipur 9 is mentioned that net consideration means the full value of consideration received or accruing as a result of the transfer of the capital asset, as reduced by any expenditure incurred wholly and exclusively in connection with such transfer. The meaning of full value of consideration in Explanation to section 54F(1) will not be governed by meaning of words \"full value of consideration as mentioned in section 50C. The value adopted for stamp duty is to be considered as full value of consideration for the purpose of computing the capital gains under section 48. Section 54F(1) says that capital gains is to be dealt with in accordance with the provisions of sub-clause (a) and (b) of section 54F(1). In the instant case, the cost of new asset(Rs.12,87,500/-) is not less than the net consideration (Rs.10,87,500/-) thus, the whole of the capital gains will not be charged, even if the capital gains (Rs.18,53,320/-) has been computed adopting the DLC value. It is clearly mentioned in section 54F(4) also that net consideration which is not appropriated towards the purchase of new asset, the same is to be taxed in case such net consideration is not deposited in the capital gain account. It is not necessary that the new asset should be got registered before filing of the return. The requirement of law is that net consideration is required to be appropriated towards the purchase of the new asset. Deeming provisions as mentioned in section 50C will not be Printed from counselvise.com ITA No. 590/JPR/2025 Meera, Jaipur 10 applicable to section 54F so far as the meaning of full value of consideration is concerned as deeming provision mentioned in section 50C is for specific asset and for the purpose of section 48. Therefore, for claiming deduction u/s 54B on account of LTCG, the assessee is required to invest the net consideration as per actual sale consideration and not as per DLC rate. This view has also been considered by various decisions of the Jurisdictional Bench, viz. (i) Gyan Chand Batra vs. ITO 133 TTJ 482(JP) (ii) ITO vs. Raj Kumar Parashar 192 TTJ 603(JP) (iii) Prakash Karnawal vs. ITO. The assessee as per record i.e. sale deed and purchase deed had invested the amount of Rs.12,87,500/- u/s 54B of the Act in purchase of new assets i.e. agriculture land, while the actual LTCG was of Rs.10,87,500/-, which was to be invested by the assessee. It shows that the assessee had invested more amount (Rs.12,87,500/-) than the net consideration received(Rs.10,87,500/-). Thus no addition is required to be made. 13. We would also like to state that in the case of Narangi Devi vs.ITO in ITA No.254/JP/2022 [one of the co-owners of Group-1], this Tribunal under identical circumstances, has allowed the appeal of the assessee. Respectfully following the above decision of the Co-ordinate Bench, we hold that no addition is required to be made on account of Printed from counselvise.com ITA No. 590/JPR/2025 Meera, Jaipur 11 Long term capital gain in the present case. We, therefore, delete the addition made by the AO. Based on these observations ground no. 3 & 4 raised by the assessee are allowed. 14. Ground No. 5 is regarding charging of interest u/s 234A, 234B and 234C which is consequential in nature. In the result, the appeal of the assessee is partly allowed. Order pronounced in the open Court on 09/09/2025. Sd/- Sd/- ¼ jkBkSM+ deys'k t;UrHkkbZ ½ ¼MkWa-,l-lhrky{eh½ (RATHOD KAMLESH JAYANTBHAI) (Dr. S. Seethalakshmi) ys[kk lnL; @Accountant Member U;kf;d lnL;@Judicial Member Tk;iqj@Jaipur fnukad@Dated:- 09/09/2025 *Santosh vkns'k dh izfrfyfi vxzsf’kr@Copy of the order forwarded to: 1. vihykFkhZ@The Appellant- Meera, Jaipur. 2. izR;FkhZ@ The Respondent- ITO, Ward-7(1), Jaipur. 2. vk;dj vk;qDr@ CIT 4. vk;dj vk;qDr@ CIT(A) 5. foHkkxh; izfrfuf/k] vk;dj vihyh; vf/kdj.k] t;iqj@DR, ITAT, Jaipur. 6. xkMZ QkbZy@ Guard File { ITA No. 590/JPR/2025 } vkns'kkuqlkj@ By order lgk;d iathdkj@Asst. Registrar Printed from counselvise.com "