RAKESH DUBEY,KATRA MOHOLLA OLD BUS STAND ASHOKNAGAR V. COMMISSIONER OF INCOME TAX APPEALS , NFAC DELHI

ITA 41/AGR/2025

AI Insights

The case involves Rakesh Dubey, the appellant, who sold an immovable property and did not report any capital gains, leading the Assessing Officer to treat the entire sale consideration as long-term capital gain and proposed additional deemed income based on the difference between the fair market value and the sale consideration. The CIT(Appeals) upheld these additions, prompting the appeal to the Income Tax Appellate Tribunal. The tribunal found that while the assessee had not adequately responded to previous notices, in the interest of justice, a final opportunity for a hearing should be granted.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 396754 (ITAT-AGRA)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-05-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2014-2015
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Matter Remanded
• Court: TRIBUNAL
• Department Lawyers: SHAILENDRA SRIVASTAVA
• Assessee Lawyers: AMIT SOGANI
• Keywords: Set aside; Capital asset; Fair market value; Principle of natural justice; Assessment record; Deemed to accrue or arise in india
• Section: 147; 148; 142(1); 133(6)

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL, AGRA BENCH, AGRA BEFORE : SHRI SUNIL KUMAR SINGH, JUDICIAL MEMBER AND SHRI MANISH AGARWAL, ACCOUNTANT MEMBER ITA No. 41/Agr/2025 Assessment Year: 2014-15 Rakesh Dubey, Katra Mohalla, Old Bus Stand, Ashoknagar (MP) Vs. Income-tax Officer, Ashoknagar (MP). PAN : BWAPD7436E (Appellant) (Respondent) ORDER Per Sunil Kumar Singh, Judicial Member: This appeal has been preferred by assessee against the impugned order dated 27.12.2024 passed in Appeal No. NFAC/2013-14/10146635 by the Ld. Commissioner of Income-tax (Appeals), NFAC, Delhi u/s. 250 of the Income-tax Act, 1961 (hereinafter referred to as “the Act”), wherein the learned first appellate authority has confirmed the additions made by the Assessing Officer and dismissed assessee’s first appeal. 2. Briefly stating, the facts are that the appellant/assessee is a non-filer. Based on the information available on assessment records, the Assessing Officer noticed that during the year under consideration, the assessee had Assessee by Sh. Amit Sogani, C.A. Department by Sh. Shailendra Srivastava, Sr. DR Date of hearing 19.05.2025 Date of pronouncement 29.05.2025 ITA No.41/Agr/2025 2 | P a g e sold an immovable property on 28.10.2013 for a sale consideration of Rs.13,00,000/- against market value of Rs.27,15,500/-, but the assessee did not offer any capital gain on the sale of the aforesaid property. The Assessing Officer, therefore, initiated proceedings u/s. 147 by issuing notice u/s. 148 of the Act dated 31.03.2021, which stood un-responded. Thereafter, notices u/s. 142(1) were issued to the assessee on 08.02.2022 and 18.02.2022, which were served upon the assessee, but for no avail. The Assessing Officer further, vide notice dated 23.02.2022 issued u/s. 133(6) of the Act sought information from Tehsildar, Ashoknagar as to the distance of the property in question from the municipal limits of Ashoknagar municipality, who vide letter dated 23.03.2022 reported that the said property is situated at a distance of approximately 1.5 KM from the municipal limits of Ashoknagar. Based on this information, the Assessing Officer observed that the assessee had sold a capital asset in terms of section 2(14)(iii)(b)(l) of the Act. Since the assessee did not offer any capital gain on the sale of this capital asset and also failed to furnish any documentary evidence with respect to the questioned property, the Assessing Officer treated the entire sale consideration of Rs.13,00,000/- as long term capital gain and proposed the same to be added in the income of the assessee. That apart, the Assessing Officer further proposed addition of Rs.14,15,500/- as deemed income of assessee, being the difference ITA No.41/Agr/2025 3 | P a g e between the fair market value of Rs.27,15,500/- and the sale consideration of Rs.13,00,000/- shown by the assessee. To the above effect, a show cause notice cum draft assessment order was issued to the assessee on 10.03.2022, in response to which the assessee filed a written submission, stating that the said property sold by assessee was a rural agricultural land and not a capital asset. The Assessing Officer was not satisfied with the submission of assessee in view of Tehsildar’s report and made addition of Rs.13,00,000/- as long term capital gain and Rs.14,15,500/- as deemed income of the assessee vide assessment order 24.03.2022 passed u/s. 147 r.w.s. 144 of the Act. 3. Aggrieved, the assessee preferred an appeal before the learned CIT(Appeals) who confirmed the addition made by the learned Assessing Officer and dismissed assessee’s first appeal. 4. Appellant/assessee has preferred this appeal apart from other grounds that the revenue has not provided sufficient opportunity of hearing and Ld. CIT(Appeals) has erred in confirming the additions made by the Assessing Officer. 5. Perused the records and heard learned Authorized Representative for the assessee and the learned Departmental Representative for the Revenue. ITA No.41/Agr/2025 4 | P a g e 6. Learned AR of the assessee has submitted that for want of proper opportunities, the assessee could not produce the proofs and documents before the learned authorities below in support of his case. Prayed to set aside the impugned order and to provide opportunity of hearing before Ld. CIT(Appeals). 7. Learned DR, on the other hand, has submitted that the assessee was provided sufficient opportunity of hearing by learned CIT(Appeals) on various occasions, but for no avail. Learned DR has supported the impugned order. 8. It transpires from the perusal of record that the assessee did not respond to the notices issued by the Assessing Officer in the assessment proceedings on various dates. The assessee also failed to respond to various notices issued by the first appellate authority on 15.09.2023, 20.02.2024, 21.06.2024, 05.07.2024 and 19.11.2024. Such an irresponsive conduct of the assessee cannot be appreciated. However, in the interest of justice and fair play, we deem it just and appropriate to afford last opportunity to the assessee and remit the matter back to the file of learned CIT(Appeals) for adjudication of the matter afresh. We order accordingly. We further direct the assessee to be diligent and cooperative in attending the hearings and making submissions before the learned CIT(Appeals) for the expeditious and effective disposal. Assessee shall refrain from seeking ITA No.41/Agr/2025 5 | P a g e any adjournment but for compelling and unavoidable reasons. Needless to say that learned CIT(Appeals) shall ensure the observance of the principles of natural justice. The appeal is liable to be allowed accordingly. 9. In the result, the appeal is allowed for statistical purposes. Order pronounced in the open court on 29.05.2025. (MANISH AGARWAL) (SUNIL KUMAR SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 29.05.2025 *aks/- Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, Agra "