SARYU DEVI,RANCHI V. ITO, WARD-1(1), RANCHI

ITA 251/RAN/2025

AI Insights

The case involves Saryu Devi, the appellant, who was assessed for the purchase of immovable property valued at 30,70,000 during the Assessment Year 2020-21. The AO initiated reassessment proceedings under Section 147 after receiving information about the property purchase, despite the appellant not having filed any income tax return or being registered on the e-filing portal at the relevant time. The CIT(A) upheld the AO's decision, leading to the appeal before the Tribunal. The Tribunal found procedural lapses in the service of notice and ruled that the reassessment was invalid. Additionally, it was determined that the property transfer was a non-monetary transaction between husband and wife, thus not attracting Section 69A.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 822554 (ITAT-RANCHI)
• Duration Of Justice: 4 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-12-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2020-2021
• Appeal Filed On: 25-07-2025
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Reassessment proceedings; Gift
• Section: 147; 148; 144; 142(1)

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL BENCH-RANCHI VIRTUAL HEARING AT KOLKATA Before Shri Sonjoy Sarma, Judicial Member and Shri Ratnesh Nandan Sahay, Accountant Member I.T.A. No.251/Ran/2025 Assessment Year: 2020-21 Saryu Devi…..………...…………….…….…............................……….……Appellant W/O Hira Nath Singh, Neori, Vikas, Sadar Ranchi, Jharkhand- 835217. [PAN: GEPPD1201D] vs. ITO, Ward-1(1), Ranchi…..….....…..…..….........……........……...…..…..Respondent Appearances by: Shri M. K. Choudhury, AR, appeared on behalf of the appellant. Shri Sumit Dasgupta, appeared on behalf of the Respondent. Date of concluding the hearing : December 18, 2025 Date of pronouncing the order : December 22, 2025 ORDER Per Sonjoy Sarma, Judicial Member: This appeal filed by the assessee is directed against the order of the NFAC, Delhi (hereinafter referred to as “CIT(A)”) dated 10.06.2025 passed under Section 250 of the Income-tax Act, 1961 (hereinafter referred to as the “Act”). 2. Brief facts of the case are that the assessee is an individual lady, residing in a village area. She had not filed any return of income for the Assessment Year 2021–22 as, according to her, she had no taxable income. The assessee was not registered on the income-tax e-filing portal during the relevant period. Her e-filing registration was done for the first time on 09.03.2025. The AO received information through the Risk Management Strategy (RMS) that the assessee had purchased immovable property for a consideration of ₹30,70,000. Based on this information, proceedings under section 147 of the Act were initiated after following Printed from counselvise.com I.T.A. No.251/Ran/2025 Saryu Devi 2 the procedure prescribed under section 148A, and approval under section 151 of the act was stated to have been obtained. Thereafter, notice under section 148 was issued, followed by notices under section 142(1) of the Act seeking compliance. As per the ld. AO, the assessee did not respond to any of the notices. The AO observed that the assessee was not registered on the e-filing portal, no email address was available, and notices were also sent through speed post. In absence of compliance, the Ld. AO completed the assessment under section 144 of the Act treating the alleged investment of ₹30,70,000 as unexplained money under section 69A of the act and added the same to the total income of the assessee. 3. Aggrieved by the order of the Ld. AO the assessee preferred an appeal before the ld. CIT(A). Where the ld. CIT(A), dismissed the appeal and sustained the addition, holding that the assessee failed to explain the source of investment and did not comply with statutory notices. 4. Aggrieved by the order of the ld. CIT(A), the assessee is in appeal before the Tribunal. At the time of hearing the Ld. AR of the assessee raised both legal and factual grounds, invalid Assumption of Jurisdiction as no notice under Section 148 of the act was served upon the assessee and without serving notice assumption of jurisdiction is bad in law as assessee was not registered on the income-tax portal at the relevant time; hence, service through electronic mode was impossible and no notice was served by email, by speed post, or by personal delivery. Therefore, the reassessment proceedings are void ab initio for want of valid service of notice. 5. On merits, it was submitted that the property in question was ancestral land. The land was transferred by her husband, Shri Hira Printed from counselvise.com I.T.A. No.251/Ran/2025 Saryu Devi 3 Nath Singh, in her name through a registered deed dated 31.01.2020.The transaction was not a sale, but a transfer without consideration between husband and wife and no money was paid or received, either in cash or through bank between the parties. The deed was executed only to safeguard the property from other family members, and to protect the interest of the assessee. The Ld AR stated that at the relevant time, as per Jharkhand Government policy, stamp duty for women was ₹1 only where property value was below ₹50 lakh and the transaction was in substance a gift, but shown as a sale deed only to save stamp duty. The Ld. AR filed an affidavit from the husband, who is also the transferor, was furnished, categorically stating that no consideration was received, no cash or bank transaction took place, the transfer was out of love and affection between the parties. It was therefore contended that there was no investment, and section 69A of the Act has no application. 6. On the other hand the learned DR supported the orders of the lower authorities. It was submitted that the assessee failed to comply with notices and the registration deed showed consideration of ₹30,70,000. Hence, the AO was justified in making the addition. 7. We after hearing the rival submission of the parties and perusal of material available on record, we find that it is an undisputed fact that the assessee was not registered on the income-tax portal during the relevant period. Her registration was done only on 09.03.2025. In such circumstances, service of notice through electronic mode was not possible. The assessee has categorically stated that no notice under section 148 of the Act was ever received, either electronically or physically. Proper service of notice under section 148 of the Act is a jurisdictional requirement. In absence of valid service, the reassessment Printed from counselvise.com I.T.A. No.251/Ran/2025 Saryu Devi 4 proceedings cannot be sustained. Therefore, we hold that the reassessment proceedings are invalid in law. 8. Even otherwise, on merits, we find that the alleged transaction is between husband and wife and the revenue has not brought any evidence to show that payment of consideration, flow of funds, cash withdrawal or deposit in such situation alleged addition cannot be made. Moreover, the affidavit of the husband clearly establishes that the transfer was without consideration, It was executed only for family and protective purposes. In present case of the assessee merely because a figure is mentioned in the registered deed, section 69A of the Act cannot be invoked unless actual money is found to have been paid or received. In the present case there is no unexplained money, there is no investment made by the assessee. In view of the above facts and legal position the reassessment proceedings under sections 147/148 of Act are held to be bad in law due to non-service of notice and even on merits, the addition under section 69A of the Act is unsustainable, as there was no monetary transaction between the parties. Accordingly, the addition of ₹30,70,000 made by the AO and sustained by the ld. CIT(A) is deleted. 9. In the result, the appeal filed by the assessee is allowed. Kolkata, the 22nd December, 2025. Sd/- Sd/- [Ratnesh Nandan Sahay] [Sonjoy Sarma] Accountant Member Judicial Member Dated: 22.12.2025. RS Copy of the order forwarded to: 1. Appellant 2. Respondent Printed from counselvise.com I.T.A. No.251/Ran/2025 Saryu Devi 5 3. CIT(A)- 4. CIT- , 5. CIT(DR), //True copy// By order Assistant Registrar, Kolkata Benches Printed from counselvise.com "