PULIKESI,SALEM V. ITO, WARD-1(1), SALEM

ITA 484/CHNY/2025

AI Insights

The case involves an appeal by the assessee, Pulikesi, against the order of the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, for the assessment year 2018-19. The primary issue was the addition of \\u20b9.16,75,000/- to the assessee's income, which represented the difference between the sale consideration and the market value of an immovable property purchased by the assessee. The property was allegedly purchased from funds received through a family partition, which was not substantiated by the Assessing Officer or the CIT(A). The ITAT found that the CIT(A) did not adequately investigate the matter and thus reduced the addition to 50% of the original amount.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 397209 (ITAT-CHENNAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-05-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2018-2019
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: P. KRISHNA KUMAR
• Assessee Lawyers: T.S. LAKSHMI VENKATARAMAN; F

Judgement Text

"आयकर अपीलीय अिधकरण, ’ए’ Ɋायपीठ, चेɄई IN THE INCOME-TAX APPELLATE TRIBUNAL ‘A’ BENCH, CHENNAI ŵी एस.एस. िवʷनेũ रिव, Ɋाियक सद˟ एवं ŵी एस.आर. रगुनाथॎ, लेखा सद˟ क े समƗ Before Shri S.S. Viswanethra Ravi, Judicial Member & Shri S.R. Raghunatha, Accountant Member आयकर अपील सं./I.T.A. No.484/Chny/2025 िनधाŊरण वषŊ/Assessment Year: 2018-19 Pulikesi, Door No. 69, Arumugam Street, Salem Corporation, Salem 636 006. [PAN:AUOPP7827L] Vs. The Income Tax Officer, Ward 1(1), Salem. (अपीलाथŎ/Appellant) (ŮȑथŎ/Respondent) अपीलाथŎ की ओर से / Appellant by : Shri T.S. Lakshmi Venkataraman, F.C.A. ŮȑथŎ की ओर से/Respondent by : Shri P. Krishna Kumar, JCIT सुनवाई की तारीख/ Date of hearing : 08.05.2025 घोषणा की तारीख /Date of Pronouncement : 29.05.2025 आदेश /O R D E R PER S.S. VISWANETHRA RAVI, JUDICIAL MEMBER: This appeal filed by the assessee is directed against the order dated 08.01.2025 passed by the ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi for the assessment year 2018-19. 2. The assessee raised 4 grounds of appeal amongst which, the only issue emanates for our consideration as to whether the ld. CIT(A) is justified in restricting the addition to an extent of ₹.16,75,000/-. I.T.A. No.484/Chny/25 2 3. It is noted that the assessee is an individual and filed return of income on 18.03.2019. According to the Assessing Officer, the assessee purchased an immovable property for a consideration of ₹.15,00,000/- on 31.08.2017 and the market value as per the document is ₹.36,50,000/-. The Assessing Officer added the difference between the sale consideration and market value to an extent of ₹.16,75,000/- 4. Before the ld. CIT(A), same submissions as advanced before the Assessing Officer regarding the investment were reiterated, which are reproduced in page 6 of the impugned order. The ld. CIT(A) held that there was no confirmation in respect of the cash received from assessee’s father HUF and accordingly confirmed the addition made by the Assessing Officer on account of difference between sale consideration and market value. 5. Before us, the ld. AR Shri T.S. Lakshmi Venkataraman, F.C.A. drew our attention to the Memorandum affirming prior oral partition dated 30.08.2016 between Co-parceners of Hindu Undivided Family. The ld. AR submits that assessment has been framed in the hands of the individual in respect of immovable property purchased by the I.T.A. No.484/Chny/25 3 assessee. The said property was purchased by the assessee out of funds brought in by family partition. The said oral partition was affirmed by Memorandum dated 30.08.2016. The said amount got in partition is the source for purchasing the property on 31.08.2017. He argued vehemently that the Assessing Officer should have summoned all the signatories and brought no material on record for non acceptance of the memorandum, without doing such exercise, the addition made by the Assessing Officer and confirmed by the ld. CIT(A), is bad in law. 6. The ld. DR relied on the order of the ld. CIT(A). 7. Heard both the parties and perused the material available on record. The assessee made submissions before the Assessing Officer regarding the source of investment of immovable property are out of capital from HUF and admittedly, no enquiry was conducted to prove the contention of oral partition by examining the parties therein. Before the ld. CIT(A) also, though the same submissions were reiterated, the ld. CIT(A) could not exercise the jurisdiction in seeking remand report from the Assessing Officer. Further, we note that the assessee also did not take any step in furnishing confirmation from other 2 signatories, who are father and brother of the assessee, which is clear from para I.T.A. No.484/Chny/25 4 5.4.1 at page 6 of the impugned order. In view of the same, we deem it proper to restrict the addition to an extent of 50% of total addition of ₹.16,75,000/- [₹.16,75,000/50%] at ₹.8,37,500/- stands explained and remaining addition of ₹.8,37,500/- is confirmed. 8. We note that the notice send by RPAD was returned unserved with an endorsement “addressee cannot be located (not known). But however, the ld. AR filed power of attorney on behalf of the assessee to represent the case. In view of the same, cost of ₹.1,000/- is imposed and payable in favour of the State Legal Aid Authority, Hon’ble High Court of Madras within 30 days from the date of receipt of this order and otherwise, the relief granted vide this order stands cancelled. 9. In the result, the appeal filed by the assessee is partly allowed. Order pronounced on 29th May, 2025 at Chennai. Sd/- Sd/- (S.R. RAGHUNATHA) ACCOUNTANT MEMBER (S.S. VISWANETHRA RAVI) JUDICIAL MEMBER Chennai, Dated, 29.05.2025 Vm/- I.T.A. No.484/Chny/25 5 आदेश की Ůितिलिप अŤेिषत/Copy to: 1. अपीलाथŎ/Appellant, 2.ŮȑथŎ/ Respondent, 3. आयकर आयुƅ/CIT, Chennai/Madurai/Coimbatore/Salem 4. िवभागीय Ůितिनिध/DR & 5. गाडŊ फाईल/GF. "