NALIN KUMAR RASTOGI LEGAL HEIR HARI SHANKAR RASTOGI,NEW DELHI V. ITO WARD 52(2), NEW DELHI

ITA 3150/DEL/2023

AI Insights

The case involves an appeal by Nalin Kumar Rastogi, the legal heir of Hari Shankar Rastogi, against the order of the Commissioner of Income-tax (Appeals), which arose from an earlier assessment order by the Income Tax Officer. The primary contention in the appeal was the rejection of the assessee's property valuation report by the Assessing Officer (AO) without consulting the District Valuation Officer (DVO), which the assessee argued was necessary as per the instructions of the CBDT. The CIT(A) dismissed the appeal, noting the absence of substantial evidence from the assessee to support the claimed costs. The Tribunal found that the CIT(A) did not adequately address several legal issues raised, including the lack of a show-cause notice and the jurisdictional authority of the AO.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 716808 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 9 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-08-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Assessment Year: 2013-2014
• Appeal Filed On: 06-11-2023
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DHEERAJ KUMAR JAIN
• Assessee Lawyers: SANDEEP GOYAL
• Keywords: Set aside; Question of law; Cost of acquisition; Valuation report; Assessment record; Value adopted by valuation officer

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES: E : NEW DELHI BEFORE SHRI S. RIFAUR RAHMAN, ACCOUNTANT MEMBER AND SHRI ANUBHAV SHARMA, JUDICIAL MEMBER ITA No.3150/Del/2023 Assessment Year: 2013-14 Nalin Kumar Rastogi, Legal Heir of Hari Shankar Rastogi, C/o Kapil Goel, Advocate, F-26/124, Sector-7, Rohini, Delhi – 110 085. PAN: AAEPR9617A Vs Income Tax Officer, Ward 52(2), New Delhi. (Appellant) (Respondent) Assessee by : Shri Sandeep Goyal, Advocate Revenue by : Shri Dheeraj Kumar Jain, Sr. DR Date of Hearing : 12.08.2025 Date of Pronouncement : 20.08.2025 ORDER PER ANUBHAV SHARMA, JM: This appeal is preferred by the assessee against the order dated 08.09.2023 of the Commissioner of Income-tax (Appeals), NFAC, Delhi (hereinafter referred to as the ld. First Appellate Authority or ‘the Ld. FAA’ for short) in Appeal No.CIT(A), Delhi-18/10628/2016-17 arising out of the appeal before it against the order dated 22.03.2016 passed u/s 143 (3) of the Income Printed from counselvise.com ITA No.3150/Del/2023 2 Tax Act, 1961 (hereinafter referred as ‘the Act’) by the ITO, Ward 52(2), Delhi (hereinafter referred to as the Ld. AO). 2. On hearing both the sides, we find that amongst other grounds on merits, the assessee has raised a ground No.2 that the impugned order of the ld.CIT(A) is passed without application of mind and suffers from apparent irrationality and arbitrariness. Ld. DR has though defended the impugned order, we find on going through the impugned assessment order and the order of the ld.CIT(A), that the AO has rejected the valuation report of the property with regard to cost of acquisition and on his own proceeded to determine the capital gain on basis of valuation cost of acquisition taken from some facts on record. The whole case of the assessee cited by the ld. AR is that without calling for the report of the DVO, the assessee’s valuation report could not have been tinkered with. The ld. AR has tried to make out a case on all the grounds including that there was a fatal impact on lack of issuance of show-cause notice by the AO as per the binding instructions of the CBDT dated 29.12.2015. 3. However, what we find is that the ld.CIT(A), after recording the brief facts of the case and reproducing the content of the assessment order, observes in para 5 that the assessee was given several opportunities of being heard. However, no written submissions were filed and, accordingly, in paras 6.1 to 6.2, has concluded as follows and dismissed the appeal:- Printed from counselvise.com ITA No.3150/Del/2023 3 “6.1 Further, the assessee has claimed cost for superior work for ground floor & first floor at Rs.1,90,000/- as on 01.04.1981 for each floor apart from the cost of construction. The cost of construction as on 01.04.1981 for each floor has been computed by the valuer at Rs.1,03,635/-. No evidence substantiating the higher cost of superior work has been filed by the assessee. It appears that the assessee has simply claimed this cost to enhance its cost of acquisition so that the indexed cost would be much higher and taxable amount of capital gain would be lesser. 6.2 At page 4 of the sale deeds dated 24/09/2012 & 26/09/2012 the history of the property in question has been mentioned with regard to ownership. The said property was owned Smt. Chandra Wati Wife of Late Sh. Jog Dhian on the basis of Partition deed dated 29/01/1948. Smt. Chandra Wati during her life time made her will dated 27/12/1979 registered on 30/01/1980 in the office of Sub-Registrar iii, New Delhi bequeathed the aforesaid property to her son Sh.Hari Shankar Rastogi, the assessee. Smt. Chandra Wati expired on 14/03/1980 and after her death the assessee Sh. Hari Shankar Rastogi became the sole and absolute Owner of the said property.” 4. Quite apparently, the order of the ld.CIT(A) is silent as to the mode and manner of service of the notices to the assessee and the finding that to his satisfaction notices were duly served to the knowledge of the assessee. At the same time, being a pure question of law, certain grounds could have been decided on the basis of the assessment record having been inquired into by the NFAC. We are of the considered view that all the contentions which have been raised by the ld. AR before us, particularly the mandate of law requiring DVO report to disturb the valuation report of the assessee and issues like non-issuance of show cause notice and lack of jurisdiction for notice u/s 143(2) of the Act by the jurisdictional AO needed to be examined at length by the ld.CIT(A), even if assessee had failed to appear. Printed from counselvise.com ITA No.3150/Del/2023 4 5. Consequently, we set aside the impugned order of the ld.CIT(A) and all issues on merits and law are restored to the files of the ld.CIT(A) to serve a fresh notice on the assessee and decide the appeal afresh in accordance with the law. Appeal is allowed for statistical purposes. Order pronounced in the open court on 20.08.2025. Sd/- Sd/- (S. RIFAUR RAHMAN) (ANUBHAV SHARMA) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 20th August, 2025. dk Copy forwarded to: 1. Assessee 2. Respondent 3. CIT 4. CIT(A) 5. DR Asstt. Registrar, ITAT, New Delhi Printed from counselvise.com "