RITA GOYAL,DEHRADUN V. ITO, WARD-2(2), DEHRADUN

ITA 3970/DEL/2018

AI Insights

The case involves Smt. Rita Goyal, who was assessed for the assessment year 2013-14 under sections 143(3)/147 of the Income-tax Act, 1961, by the Income Tax Officer, Ward-2(2), Dehradun. The primary issue was the classification of income from the sale of plotted land. The Assessing Officer treated the income as business income rather than capital gains, invoking section 50C read with section 43CA to arrive at a fair market value of the plots sold. The CIT(A) upheld this assessment. However, the Tribunal found that the application of section 43CA was incorrect as it was not applicable for the assessment year in question, leading to the deletion of the added business income.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 633003 (ITAT-DEHRADUN)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-06-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2013-2014
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AMAR PAL SINGH
• Assessee Lawyers: PRAVEEN GOYAL; SELF
• Keywords: Business income; Sale consideration of property below Jantri Value; Fair market value; Cost of acquisition; Capital Gains
• Section: 43CA; 50C

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCHES “DB”, NEW DELHI BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER AND SHRI M. BALAGANESH, ACCOUNTANT MEMBER (Through Video Conferencing) ITA No.3970/DEL/2018 Assessment Year: 2013-14 Smt. Rita Goyal, H. No. 28, Sahastradhara Road, Dehradun, Uttarakhand Vs. Income Tax Officer, Ward-2(2), Dehradun PAN :AHYPG4217C (Appellant) (Respondent) ORDER PER SATBEER SINGH GODARA, JM This assessee’s appeal for assessment year 2013-14, arises against the Commissioner of Income Tax (Appeals) [in short, the “CIT(A)”], Dehradun’s order dated 16.03.2018 passed in case no. 10366/CIT(A)/DDN/2016-17(362500440120118), involving proceedings under sections 143(3)/147 of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’). Heard both the parties. case file perused. Assessee by Sh. Praveen Goyal, Self Department by Sh. Amar Pal Singh, Sr. DR Date of hearing 20.03.2025 Date of pronouncement 13.06.2025 ITA No.3970/Del/2018 2 | P a g e 2. A perusal of the instant case file indicates at the outset that both the learned lower authorities have added assessee’s alleged business profits of Rs.95,45,830/- on transfer of the corresponding plots of land thereby holding her to have indulged in the real estate business, in assessment order dated 28.12.2017 and upheld in the lower appellate discussion. 3. We now come to the basic relevant facts. The assessee had admittedly sold her duly plotted land vide four sale deeds to Sh. Deepak Dubey and his wife Smt. Shubha Dubey for Rs. 50 lakhs in total involving as may sale instances. Learned Assessing Officer’s assessment discussion reads that he firstly rejected the assessee’s claim declaring capital gains than business income; and, therefore, invoked section 50C r.w.s. 43CA of the Act to arrive at fair market value of the above four plots coming to Rs.1,01,60,000/- as reduced by cost of acquisition of Rs.5,60,170/-; respectively, thereby adding business income of Rs.95,45,830/- forming subject matter of adjudication herein. Learned CIT(A) has upheld the above assessment findings against the assessee. 4. We have given our thoughtful consideration to the assessee’s and the Revenue’s vehement submission reiterating their ITA No.3970/Del/2018 3 | P a g e respective stands. We make it clear first of all that the assessee had admittedly declared capital gains which stand treated as business income in the Assessing Officer’s assessment discussion. He has thereafter invoked section 43CA r.w.s. 50C of the Act to add the above business income in her hands. 5. Faced with this situation, the Revenue could hardly dispute that section 43CA providing for such an addition came to be inserted in the Act vide Finance Act, 2013 w.e.f. 01.04.2014 and applicable from assessment year 2014-15 onwards as per the explanatory notice thereof whereas we are in assessment year 2013-14 only. We thus conclude in this factual backdrop that the learned lower authorities’ action invoking section 43CA addition in the assessee’s case is not sustainable in law in very terms. The impugned addition of Rs.95,45,830/- is hereby deleted in other words. 6. This assessee’s appeal is allowed. Order pronounced in the open court on 13th June, 2025 Sd/- Sd/- (M. BALAGANESH) (SATBEER SINGH GODARA) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 13th June, 2025. RK/- Copy forwarded to: 1. Appellant ITA No.3970/Del/2018 4 | P a g e 2. Respondent 3. CIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, New Delhi "