PREM SAGAR CHOPRA,MUMBAI V. INCOME TAX OFFICER 16(1)(3), MUMBAI

ITA 4538/MUM/2025

AI Insights

The case revolves around an appeal by Neelam Prem Sagar Chopra, the legal heir of the deceased assessee, against the order of the Commissioner of Income-tax (Appeals), National Faceless Appeal Centre (NFAC), which confirmed the reassessment and addition of Rs. 1.75 crore as unexplained income under section 68 of the Income Tax Act. The reassessment was initiated based on the sudden increase in the capital account of the assessee, which was not routed through the profit and loss account. The assessee contended that this increase was due to a family settlement and not taxable. The Tribunal examined the validity of the reassessment and the merits of the addition, ultimately deciding in favor of the assessee by rejecting the addition and allowing the appeal.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 824727 (ITAT-MUMBAI)
• Duration Of Justice: 5 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-12-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2014-2015
• Appeal Filed On: 16-07-2025
• Other Referred Cases: Raymond Woollen Mills Ltd. vs ITO, Consolidated Photo & Finvest Ltd. vs ACIT, CIT Vs P.K. Noorhahan, ACIT Vs Geno Pharmaceutical Ltd
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIRABHADRA MAHAJAN; VIRTUALLY
• Assessee Lawyers: S VIPUL JOSHI; PRASHANT GHUMARE; INVOKING; AN AMOUNT OF RS. . CRORE; WHICH IS NOT ROUTED THROUGH PROFIT; REFERRING VARIOUS SHOW CAUSE NOTICE ISSUED; AN AMOUNT OF RS. . CRORE; WHICH IS NOT
• Keywords: Difference of opinion; Change of opinion; Opportunity of being heard; Additional evidence; Principle of natural justice; TDS; Competent authority; Tangible material
• Section: 147; 142(1)

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL “C” BENCH, MUMBAI BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER & SHRI GIRISH AGRAWAL, ACCOUNTANT MEMBER ITA No. 4538/MUM/2025 (AY : 2014-15) (Physical hearing) Prem Sagar Chopra (since deceased) through Neelam Prem Sagar Chopra (wife), Sagar Villa Road No. 12A, JVPD Scheme, Juhu, Mumbai, Maharashtra – 400049. [PAN No. AAPPS2469E] Vs ITO - 16(1)(3) Mumbai, Room No. 438, Aayakar Bhavan, M.K. Road, Churchgate, Mumbai – 400020. Appellant / Assessee Respondent / Revenue Assessee by S/Shri Vipul Joshi and Prashant Ghumare, Advocates Revenue by Shri Virabhadra Mahajan, Sr. DR (virtually) Date of institution of appeal 16.07.2025 Date of hearing 09.10.2025 Date of pronouncement 29.12.2025 Order under section 254(1) of Income Tax Act PER PAWAN SINGH, JUDICIAL MEMBER; 1. This appeal by assessee is directed against the order of ld. CIT(A)/NFAC dated 30.06.2025 for A.Y. 2018-19. The assessee has raised revised following grounds of appeal: 1. THE ORDER IS BAD IN LAW, ILLEGAL AND WITHOUT JURISDICTION 1.1 In the facts and the circumstances of the case, and in law, the appellate order u's. 250 of the Income tax Act, 1961 ['the Act'] framed and passed on 30.06.2025 by the Commissioner of Income-tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi ['Ld. CTT (A)') is bad in law, illegal and without jurisdiction, as the same is framed in breach of the statutory provisions of the Act and the scheme and as otherwise also is not in accordance with the law. Printed from counselvise.com Prem Sagar Chopra through LR’s Neelam Prem Sagar Chopra ITA No. 4538/Mum/2025 (A.Y. 2014-15) 2 12 Without prejudice to the generality of the above, the appellate order so passed is bad in law, illegal and void as the same is arbitrary and perverse. 2. VIOLATION OF PRINCIPLES OF NATURAL JUSTICE 2.1 In the facts and the circumstances of the case, and in law, the appellate order so framed in bad in law and illegal, as the same is framed in breach of the principles of Natural Justice. 2.2 Without prejudice to the generality of the above ground, in the facts and the circumstances of the case, the Ld. CIT (A) erred in – (i) not granting proper, sufficient, reasonable and fair opportunity of being heard to the Appellant while passing the appellate order, and (ii) not granting an opportunity of personal hearing. 3. CHALLENGE TO REASSESSMENT 3.1 The Ld. CIT (A) erred in confirming the action of the A.O. in initiating the reassessment proceeding and framing the assessment of the Appellant by invoking the provisions of section 147 r.w.s. 148 of the Act. 3.2 While doing so, the Ld. CIT (A) failed to appreciate that: (i) The case of the Appellant did not fall within the parameters laid down by section 147 r.w.s. 148, 149 & 151 of the Act; (ii) The necessary preconditions for initiating the reassessment proceeding and completion thereof were not satisfied. 3.3 It is submitted that in the facts and the circumstances of the case, and in law, the reassessment framed is bad in law, illegal and without jurisdiction. WITHOUT PREJUDICE TO THE ABOVE: 4. ADDITION OF Rs. 1,75,47,681/- U/S. 68 OF THE ACT 4.1 It is submitted that, in the facts and circumstances of the case and in law, the CIT(A) erred in confirming the action of the A.O. in making addition of the amount of Rs. 1,75,47,681/-u/s. 68 of the Act, as alleged unexplained income. Printed from counselvise.com Prem Sagar Chopra through LR’s Neelam Prem Sagar Chopra ITA No. 4538/Mum/2025 (A.Y. 2014-15) 3 4.2 While doing so, the Ld. CIT(A) erred in – (i) Basing his action only on surmises, suspicion and conjecture, (ii) Taking into account irrelevant and extraneous considerations; and (iii) Ignoring relevant material and considerations as submitted by the Appellant. 4.3 It is submitted that in the facts and the circumstances of the case, and in law, no such disallowance was called for. 4.4 Without prejudice to the above, assuming-but not admitting - that some addition was called for, the Ld. CIT (A) failed to appreciate that the computation of the addition made by the A.O. is not in accordance with the law, is arbitrary, and excessive. 5. LIBERTY The Appellant craves leave to add, alter, delete or modify all or any the above ground at the time of hearing.” 2. This appeal by assessee is directed against the order of ld CIT(A) dated 30.06.2025. This appeal was instituted on 16.07.2025. After institution of appeal, the assessee died on 31.08.2025, copy of death certificates is placed on record. The legal heirs of the assessee has filed an application for substitution of his legal representative in the form of affidavit, wherein it is stated that assessee died on 31.08.2025 leaving behind his wife, Smt. Neelam Prem Sagar, two married daughters namely Shabnam Gupta and Ganga Kadakia and a son namely Shiv Prem Sagar. Son and daughters of deceased have no objection, if Smt. Neelam Prem Sagar is substituted in place of deceased assessee in the present appeal. No written objection is filed by assessing officer. The legal heirs of assessee have also filed fresh Form 36, which has been taken on record and Printed from counselvise.com Prem Sagar Chopra through LR’s Neelam Prem Sagar Chopra ITA No. 4538/Mum/2025 (A.Y. 2014-15) 4 accordingly Neelam Prem Sagar is substituted as legal heirs of Prem Sagar Chopra in the present appeal, for the purpose of persecution of present appeal. 3. Brief facts of the case are that assessee is an individual besides partner in a firm namely Sagar Art Corporation, filed his return of income for assessment year (A.Y.) 2014-15 declaring income of Rs. 47,03,430/-. The assessing officer was having information that there is sudden increase in the capital account of assessee by an amount of Rs. 1.75 crore, which is not routed through profit and loss (P&L) account. The assessing officer recorded that after recording reasons, he obtained necessary approval from competent authority and issued notice under section 148 dated 25.03.2021. The assessing officer further recorded that objections were filed by assessee against validity of notice under section 148 and after disposal of objection, he proceeded for reassessment. The assessing officer issued various show cause notice to the assessee to substantiate the increase in capital account. The assessing officer recorded that assessee has furnished reply but given vague and incomplete reply, in response to his various show cause notices. The assessing officer recorded that assessee in his reply submitted that he is maintaining two separate books of account that is one for his business and profession and one for his personal affairs. Separate books of account are maintained for the purpose of profession in term of section 44AA under the account “Prem Sagar”. Such account is audited and audited account was furnished. The assessee also furnished copy of statement of personal account. The assessing officer also recorded that assessee repeatedly submitted that he Printed from counselvise.com Prem Sagar Chopra through LR’s Neelam Prem Sagar Chopra ITA No. 4538/Mum/2025 (A.Y. 2014-15) 5 has also placed on record to complete the details including figure of addition of capital account that is Rs. 4,10,354/- in his business account and Rs. 1.75 crore in his personal account. The assessing officer also recorded that in response to show cause notice dated 25.03.2022, the assessee furnished Memorandum of Understanding (MoU) recording oral family settlement dated 02.03.2011 and letter dated 16.02.2022 wherein bifurcation of increased capital was furnished. The assessee also claimed that increase in capital of Rs. 1.75 crore is on account of family settlement and share received as a capital distribution and not taxable in the hand of assessee. The assessing officer recorded that MoU is dated 02.03.2011 which was executed in F.Y. 2010-11 that is much before current assessment year. The assessing officer concluded that source of capital through family settlement has no relation in the assessment year under consideration. The assessing officer accordingly added Rs. 1.75 crore under section 68 in the assessment order under section 147 r.w.s. 144B passed on 31.03.2022. 4. Aggrieved by the additions in the assessment order, the assessee filed appeal before ld. CIT(A). Before ld. CIT(A), the assessee challenged the validity of reassessment under section 147 and issuance of notice under section 148 as well as additions on merit. The assessee also furnished detailed written submissions. The summary of submission are recorded on page no. 4 to 6 of order of ld. CIT(A). In the submission, the assessee stated that assessing officer accepted that personal balance sheet along with capital account was furnished. Such accounts were not examined by assessing officer. All material related to Printed from counselvise.com Prem Sagar Chopra through LR’s Neelam Prem Sagar Chopra ITA No. 4538/Mum/2025 (A.Y. 2014-15) 6 assessment was available before assessing officer. The assessee furnished complete bifurcation of increase in capital account along with bifurcation. The assessee submitted that break up of Rs. 1.46 crore and Rs. 24.81 lacs was received by way of journal entry in furtherance of family arrangement. No income is earned by assessee. The family settlement was furnished to the assessing officer all details were furnished before assessing officer. On the submission of assessee, the ld. CIT(A) directed the assessing officer to furnish his remand report. The contents of remand report is mentioned in para-5 at page no. 6 to 9 of order of ld. CIT(A). In the remand report, the assessing officer mentioned that in response to his show cause notice during assessment proceeding, the assessee furnished details with covering letter dated 12.02.2024 wherein financial statement of ‘Sagar Art Corporation’ and ITR thereof for A.Y. 2011-12 was furnished. About increase in capital account of Rs. 24.81 lacs, the assessee furnished financial statement of ‘Natraj Studio LLP’ wherein actual profit for the year under consideration is only Rs. 23,39,802/- against the claim of Rs. 24,81,076/- for remaining amount of increase in capital of Rs. 1.41 crore which was received in the form of shares from Moti Sagar against family settlement. The assessing officer objected that valuation of shares is not available on record. The assessing officer also referred the detailed called in respect of Rs. 2.18 crore from Prem Sagar Bank Account. The assessing officer recorded that no reply was furnished by assessee. Further, the assessee submitted the detail of capital Printed from counselvise.com Prem Sagar Chopra through LR’s Neelam Prem Sagar Chopra ITA No. 4538/Mum/2025 (A.Y. 2014-15) 7 account on account of family settlement wherein Rs. 1.46 crore was transferred to the account of assessee. 5. The ld. CIT(A) on considering the submission of assessee upheld the action of assessing officer, on validity of reopening he referred and relied on the decision of Raymond Woollen Mills Ltd. vs ITO (1999) 236 ITR 34 (SC) wherein it was held that sufficiency of reasons is not to be judged at the time of issuance of notice under section 148. If assessing officer could not discover fact earlier due to lack of diligence, reopening is justified. The ld. CIT(A) also relied upon the decision of Delhi High Court in Consolidated Photo &Finvest Ltd. vs ACIT (2006) 281 ITR 394 (Del) wherein it was held that if new information comes to light revealing escapement of income reopening is valid, even if the issue was examined in original assessment. On merit, the ld. CIT(A) held that on receipt of additional evidence during appellate proceeding, remand report was called from assessing officer. The assessee was directed to substantiate the source of capital introduction. The assessee failed to produce definite documentary evidence to justify year-wise credit and actual flow of fund for asset in A.Y. 2014-15. The family settlement was executed on 02.03.2011 which pertains to F.Y. 2010-11. The assessee failed to establish the actual date of transfer and valuation thereof. No evidence of capital infusion in current financial year is furnished. Further, profit of LLP does not with the assessee’s capital account. Thus, the assessing officer upheld the action of assessing officer. Further aggrieved, the assessee has filed present appeal before Tribunal. Printed from counselvise.com Prem Sagar Chopra through LR’s Neelam Prem Sagar Chopra ITA No. 4538/Mum/2025 (A.Y. 2014-15) 8 6. We have heard the submissions of learned authorised representative (ld. AR) of the assessee and the learned senior departmental representative (ld. Sr. DR) for the revenue and have gone through the orders of lower authorities carefully. The ld AR of the assessee submits that appellant is the son of famous film producer/director late Ramanand Sagar. During his lifetime, Ramanand Sager set up various business concerns in the form of companies, partnership firms, LLPs etc. Ramanand Sager passed away on 20th December 2005, followed by his death, his wife (mother of assessee) also died on 22nd June 2006, leaving behind a big family and HUFs, apart from various business entities. After the death of mother, serious and bitter disputes developed amongst the family members which lead to litigation in the different forums. With a view to mitigate the family dispute and in the interest of family peace and harmony an oral family settlement was arrived which was executed by all the family members i.e. by all the legal hears of late Ramanand Sager in the form of Memorandum of Understanding (MOU), copy of which is placed on record. As per the MOU there was distribution of various properties including business entities as has been referred therein. So far is present appeal is concerned, the relevant part of MOU is distribution of shares of various companies, more particularly shares of Sagar Entertainment Private Limited, Natraj Studio LLP which has been mentioned on page 10 to 15 of such MOU. Under such family settlement, the appellant/assessee was eligible for shares of such companies and firm. So far as partnership firm is concerned, the assessee is also eligible for his share in the partnership firm namely Sagar Art Printed from counselvise.com Prem Sagar Chopra through LR’s Neelam Prem Sagar Chopra ITA No. 4538/Mum/2025 (A.Y. 2014-15) 9 Corporation, wherein brother of assessee namely Moti Sagar, relinquished his share in the partnership firm in the favour of assessee and other members. Such facts are mentioned on page 16 of such family settlement/MOU. As a part of overall distribution, in return or in exchange in view of shares an understanding was arrived either to make payment to other shareholder or to relinquish shares in lieu thereof. Due to complexity of shares in different entities and passing of appropriate accounting entries regarding inter-se adjustment in term of MOU, it became a challenging task, more so on account of lack of full and timely sharing on for information and taking various actions pursuant to such MOU. While explaining such understanding, the learned AR for the assessee explained that assessee made payment of ₹ 2.18 Crore to Moti Sagar and others way back in 2011, the assessee received properties in the form of shares only later years. Further due to delayed receipt of information, some of entries, though relating to earlier years could be passed only in the year under consideration on receipt of such information. Such entries had to be passed only general entries for resisting mutual rights without any actual receipts. Undisputed fact is that all such receipt are part of shares received by way of inheritance on the death of his father which were finalised/ crystallised under MOU. Such entries were made in the personal account of the assessee, which is not a part of business activities for the year ending on 31st March 2014. Certain entries in capital accounts came to be passed concerning settlement simply based on piecemeal information Printed from counselvise.com Prem Sagar Chopra through LR’s Neelam Prem Sagar Chopra ITA No. 4538/Mum/2025 (A.Y. 2014-15) 10 received. The entries consist of normal routine entry of Rs. 28,95,854/- and of Rs. 1.46 Crore entry on account of family settlement. 7. The learned AR of the assessee submits that a bare perusal of entries clearly shows that none of the items are in the nature of income. Rs.28.95 lakhs pertains to the share of profit of Sagar Art Corporation and Natraj Studio LLP. The rest of the entries pertaining to reference, reversal of tax entries etc. As regard to the share of profit from Saga Art Corporation, the same is shown in capital account of the firm. So far as other entries aggregating of ₹ 1.42 crore, which pertains to the share received or to be received under the family settlement in term of MOU. 8. In support of legal issue on the validity of reassessment, the learned AR of the assessee submits that assessee filed his return of income under section 139(1) on 13th November 2014, which was subsequently revised on 1st December 2014 declaring total income of ₹ 47,03,440/-. The return was processed under section 143(1). Later on, the return was selected for scrutiny. Several personal hearing was fixed by the assessing officer, who obtained various information which consist of computation of income, return of income, financials including personal capital account, detail of a transaction along with reconciliation of TDS, bank book and bank statement. The assessing officer also obtained explanation regarding cash system of accounting, including explanation regarding certain entries pertaining to earlier years credited in previous years. The assessing officer after complete satisfaction and verification of all the information and Printed from counselvise.com Prem Sagar Chopra through LR’s Neelam Prem Sagar Chopra ITA No. 4538/Mum/2025 (A.Y. 2014-15) 11 documents finalised assessment under section 143(3). The assessing officer accepted the books of account. The assessment was reopened by issuing notice under section 148 on 25 March 2021. In response to notice under section 148, the assessee filed his return of income on 24th December 2021. The assessee also objected to the reopening. The reasons recorded were not supplied to the assessee. The details asked by assessing officer were already provided during the original assessment. The region is recorded are not correct. Wrong facts were mentioned in the region is recorded the region is recorded were based on change of opinion. No tangible material came to the notice of assessing officer. All the information, which was made basis for the opening were available on record. The ld AR of the assessee by referring various show cause notice issued during the original assessment proceeding submits that all such issues were discussed in the original assessment proceeding. The ld AR of the assessee further submits that no notice under section 143(2) was issued by assessing officer. No sanction as required under section 151 was obtained by assessing officer as it was never supply to the assessee despite asking for it. None of the received which comprised of ₹ 1.75 crore is not taxable in the end of assessee as it is a general entry just to record the family agreement and no income was earned by the assessee thus there was no escapement of income. Hence the belief of assessing officer about escapement of income is erroneous. The learned AR of the assessee submits that he has good case on merit as well as on legal issue. To support his submissions, the ld AR of the assessee relied on the Printed from counselvise.com Prem Sagar Chopra through LR’s Neelam Prem Sagar Chopra ITA No. 4538/Mum/2025 (A.Y. 2014-15) 12 decision of Hon’ble Supreme Court in CIT Vs P.K. Noorhahan (1999) 103 Taxman 382(SC), ACIT Vs Geno Pharmaceutical Ltd (2013) 32 taxmann.com 162 (Bombay). 9. On the other hand the learned senior DR for the revenue supported the order of lower authorities. The learned senior DR for the revenue submits that sufficiency of region is not to be examined at the time of reopening as has been held by Superior Court in a number of decisions. The learned CIT(A) in its order has categorically relied upon the decision in Raymond Woollen Mills of honourable Supreme Court as well as decision of honourable Delhi High Court in Consolidated Photo & Finvest Ltd. vs ACIT (supra). The objections of assessee were disposed of by way of speaking order. The learned CIT (A) in para 6.1.4 of his order clearly recorded that notice under section 143(2) and 142(1) were duly issued. The assessee responded to such notice and participated in the assessment proceeding, therefore objection of assessee is devoid of merit. On merit, the learned senior DR for the revenue submits that before assessing officer the assessee has not furnished complete details and evidence to substantiate increased in the capital account. On receipt of additional evidence, the ld CIT(A) obtained remand report from assessing officer. During remand proceeding, the assessee was asked to substantiate the source of capital introduction. During remand proceeding, the assessee filed to produce sufficient documentary evidence to justify year wise credit and actual flow of funds. The alleged family settlement/MOU was executed in March 2011, which pertains to Printed from counselvise.com Prem Sagar Chopra through LR’s Neelam Prem Sagar Chopra ITA No. 4538/Mum/2025 (A.Y. 2014-15) 13 assessment year 2011-12. The ld Sr DR for the revenue prayed for confirming the addition made in the assessment order. 10. We have considered the rival submission of both the parties and have gone through the orders of lower authorities carefully. We have also deliberated on various documentary evidences filed by the assessee on record including the family settlement recorded in the form of MOU. Firstly, we are considering the validity of the additions on merit. We find that during assessment, the assessing officer recorded that he was having information that there is sudden increase in the capital account of assessee by an amount of Rs. 1.75 crore, which is not routed through profit and loss (P&L) account. On show cause notice the assessee claimed that in response to show cause notice dated 25.03.2022, the assessee furnished MoU about oral family settlement dated 02.03.2011 and further vide letter dated 16.02.2022 the bifurcation of increased capital was furnished. The assessee claimed that increase in capital of Rs. 1.75 crore is on account of family settlement and share received as a capital distribution and not taxable in the hand of assessee. The assessing officer was of the view that MoU is dated 02.03.2011 which was executed in F.Y. 2010-11, which is much before current assessment year. The assessing officer held that source of capital through family settlement has no relation in the assessment year under consideration. The assessing officer accordingly added Rs. 1.75 crore under section 68. We find that before ld CIT(A) the assessee furnished detailed written submissions. On the submissions, the ld CIT(A) called remand report form assessing officer. The Printed from counselvise.com Prem Sagar Chopra through LR’s Neelam Prem Sagar Chopra ITA No. 4538/Mum/2025 (A.Y. 2014-15) 14 assessing officer furnished his remand report. We find that in the remand report, the assessing officer accepted that in response to his show cause notice during assessment proceeding, the assessee furnished details with covering letter dated 12.02.2024 wherein financial statement of ‘Sagar Art Corporation’ and ITR thereof for A.Y. 2011-12 was furnished. About increase in capital account of Rs. 24.81 lacs, the assessee furnished financial statement of ‘Natraj Studio LLP’ wherein actual profit for the year under consideration is only Rs. 23,39,802/- against the claim of Rs. 24,81,076/- for remaining amount of increase in capital of Rs. 1.41 crore which was received in the form of shares from Moti Sagar against family settlement. We find that the assessing officer objected that valuation of shares is not available on record. It was also accepted that the assessee submitted the detail of capital account on account of family settlement wherein Rs. 1.46 crore was transferred to the account of assessee. We find that on receipt of remand from assessing officer about actual receipt of Rs.23,39,802/- against claim of assessee of Rs. 24,81,076/- no further clarification was sought from the assessee. Further, the assessee also furnished details of capital of Rs. 1.41 Crore received from Moti Sagar in the form of shares of various companies. We find that before ld CIT(A) the assessee furnished complete details of increased in capital which were not routed through the profit and loss account, rather it was received by way of inheritance and directly reflected in the balance sheet of the assessee. Before us, the ld AR of the appellant vehemently argued that appellant is the son of famous film producer Printed from counselvise.com Prem Sagar Chopra through LR’s Neelam Prem Sagar Chopra ITA No. 4538/Mum/2025 (A.Y. 2014-15) 15 late Ramanand Sagar, who during his lifetime, set up various business concerns in the form of companies, partnership firms, LLPs etc. Ramanand Sager passed away in December 2005 and his wife in June 2006, leaving behind a big family and HUFs, apart from various business entities. After the death of parents of appellant / assessee serious disputes developed in family which ultimately settled by way of oral family settlement in the form of MOU. Such facts are not in dispute. 11. We find that as per MOU there was distribution of various properties including business entities as has been referred therein. We find that distribution of shares of various companies, more particularly shares of Sagar Entertainment Private Limited, Natraj Studio LLP which has been mentioned on page 10 to 15 of such MOU. Under such family settlement, the appellant/assessee is eligible for shares of such companies and firm. And from partnership firm, the assessee is eligible for his share in Sagar Art Corporation. As per conditions of MOU, brother of assessee namely Moti Sagar, relinquished his share in the partnership firm in the favour of assessee and other members. Such facts are mentioned on page 16 of such family settlement/MOU. As a part of overall distribution, in return or in exchange in view of shares and understanding was arrived either to make payment to other shareholder or to relinquish shares in lieu thereof. On appreciation of aforesaid facts we find merit in the submissions of ld AR of the assessee that entries made in the capital account of the assessee as per term and conditions and on acting upon such conditions by all the family members, Printed from counselvise.com Prem Sagar Chopra through LR’s Neelam Prem Sagar Chopra ITA No. 4538/Mum/2025 (A.Y. 2014-15) 16 the increase in the capital account is not taxable in the hand of the assessee. It is settled position under the income tax that share received in movable or immovable properties on division of joint family property is on capital account and is not taxable in the hand of individual. In the result, the ground No. 4 of appeal is allowed. Considering the facts that we have allowed relief to the assessee/ appellant, thus, adjudication on merits has become academic. 12. In the result, the appeal of the assessee is allowed Order was pronounced in the open Court on 29/12/2025. Sd/- GIRISH AGRAWAL ACCOUNTANT MEMBER Sd/- PAWAN SINGH JUDICIAL MEMBER MUMBAI, Dated: 29/12/2025 Biswajit Copy of the order forwarded to: (1) The Assessee; (2) The Revenue; (3) The PCIT / CIT (Judicial); (4) The DR, ITAT, Mumbai; and By order (5) Guard file. Assistant Registrar ITAT, Mumbai Printed from counselvise.com "