SHAMSU UL ZOHA JERMAIN,COULSDON, UNITED KINGDOM V. INCOME TAX OFFICER, (INT TAXN)-1, HYDERABAD.

ITA 1125/HYD/2024

AI Insights

Ms. Shamsu Ul Zoha Jermain, a non-resident individual, appealed against the order of the Income Tax Officer (ITO), which added Rs.69,14,289 as capital gains for the Assessment Year 2015-16. The addition was based on the income from the sale of land, which the ITO claimed had escaped assessment. The Tribunal examined the circumstances of the land sale, which involved multiple family members and a construction company, Tirumala Tirupati Constructions (India) Pvt. Ltd. The Tribunal found that the land had been previously sold and the gains taxed in 2011-12, and thus, the addition for 2015-16 was a case of double taxation.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 708626 (ITAT-HYDERABAD)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-07-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Assessment Year: 2015-2016
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B.BALAKRISHNA
• Assessee Lawyers: SAI PRASAD
• Keywords: Condonation of delay; Capital asset; Reasonable cause; Reassessment proceedings; Capital Gains
• Section: 147; 148; 139

Judgement Text

" आयकर अपीलीय अधिकरण, हैदराबाद पीठ IN THE INCOME TAX APPELLATE TRIBUNAL Hyderabad ‘A’ Bench, Hyderabad श्री रविश सूद, न् याययक सदस् य एवं श्री मिुसूदन सावडिया, लेखा सदस् य क े समक्ष । BEFORE SHRI RAVISH SOOD, JUDICIAL MEMBER AND SHRI MADHUSUDAN SAWDIA, ACCOUNTANT MEMBER आ.अपी.सं /ITA No.1125/Hyd/2024 (निर्धारण वर्ा/Assessment Year:2015-16) Ms. Shamsu Ul Zoha Jermain, Coulsdon, United Kingdom. PAN: CJEPJ5865K Vs. Income Tax Officer, (International Taxation)-1, Hyderabad. (Appellant) (Respondent) निर्धाररती द्वधरध/Assessee by: Shri K.A. Sai Prasad, C.A. रधजस् व द्वधरध/Revenue by: Shri B. Bala Krishna, CIT-DR सुिवधई की तधरीख/Date of hearing: 10/07/2025 घोर्णध की तधरीख/Pronouncement: 18/07/2025 आदेश/ORDER PER MADHUSUDAN SAWDIA, A.M.: This appeal is filed by Ms. Shamsu Ul Zoha Jermain (“the assessee”), feeling aggrieved by the order passed by the Learned Assessing Officer (“Ld. AO”) u/s. 147 r.w.s. 144 of the Income Tax Act, 1961 (“the Act”) dated 11.12.2023 for the A.Y. 2015-16. ITA No.1125/Hyd/2024 2 2. At the outset, it is observed that there is a delay of 243 days in filing the present appeal before the Tribunal. The assessee has filed a petition for condonation of delay accompanied by an affidavit of the assessee and an affidavit of the counsel, explaining the reasons for the delay. It has been stated that the assessee is a non-resident individual and had engaged the services of Shri Rakesh Roshan, a retired Income Tax Officer, to look after her income tax matters before the Learned Dispute Resolution Panel (“Ld. DRP”). Due to advanced age and deteriorating health, Shri Rakesh Roshan is said to have handed over the responsibility of the case to Shri Krishna Mohan, a tax consultant. In the intervening period, Shri Rakesh Roshan unfortunately passed away. Shri Krishna Mohan, who had been delegated the file, did not possess updated contact details of the assessee, and therefore could not inform her about the passing of the final assessment order by the Learned Assessing Officer (“Ld. AO”) pursuant to Ld. DRP directions. Only in September 2024, when the assessee independently contacted Shri Krishna Mohan to enquire about the case status, did she come to know about the order passed by the Ld. AO. Immediately upon such discovery, the assessee took ITA No.1125/Hyd/2024 3 steps to file the present appeal before the Tribunal. The delay of 243 days has thus occurred due to unavoidable circumstances beyond the control of the assessee, and not due to any deliberate or negligent conduct. The Learned Authorised Representative (“Ld. AR”) submitted that the delay is bonafide and covered by reasonable cause and deserves to be condoned in the interest of justice. 2.1 Per contra, the learned Departmental Representative (“Ld. DR”) opposed the condonation, submitting that sufficient time had already elapsed and due diligence was not exercised. 2.2 We have heard the rival submissions and carefully perused the material available on record. It is evident that the assessee is a non- resident, and the delay has arisen due to genuine and unavoidable reasons, including the death of the earlier counsel and the lack of communication arising from the transition of representation. The explanation offered by the assessee is backed by affidavit and is not found to be motivated or lacking in bona fides. In our considered view, the delay falls within the realm of substantive justice, and denying adjudication on merits merely on technical grounds would ITA No.1125/Hyd/2024 4 cause irreparable prejudice to the assessee, who has shown reasonable cause. Accordingly, the delay of 243 days in filing the appeal is condoned, and the appeal is admitted for adjudication on merits. 3. The assessee has raised the following grounds of appeal : ITA No.1125/Hyd/2024 5 4. The brief facts of the case are that, the assessee is a non-resident individual who did not file any return of income u/s. 139 of the Income Tax Act, 1961 (“the Act”) for the Assessment Year 2015–16. Based on available information, the Ld. AO observed that the assessee had earned income on account of capital gains on sale of land, which had escaped assessment within the meaning of Section 147 of the Act. Accordingly, notice under Section 148 of the Act dated 28.03.2021 was issued to the assessee. After considering the submissions filed by the assessee, the Ld. AO passed a draft assessment order under Section 144C(1) of the Act on 27.02.2023 making an addition of Rs.69,14,289/- on account of income on sale of land under the head “Capital Gains.” The assessee filed objections before the Ld. DRP, which were rejected. Subsequently, the Ld. AO ITA No.1125/Hyd/2024 6 passed the final assessment order under Section 147 r.w.s. 144 of the Act on 11.12.2023, sustaining the addition of Rs.69,14,289/-. 5. Aggrieved with the final assessment order of Ld. AO, the assessee filed the present appeal before the Tribunal. The Ld. AR submitted that, the assessee along with her three sisters and two brothers were joint legal heirs to a total landholding of 39 acres 11 guntas of land inherited from their father. As per the partition, 50% of the land was to be held by her two brothers and 50% by the assessee along with her three sisters, thereby entitling each of them to 19 acres 25.5 guntas. The Ld. AR invited our attention to the registered agreement for sale-cum-general power of attorney (“GPA”) dated 19.04.2010, placed at page nos. 24 to 34 of the paper book, and submitted that the assessee along with her three sisters had transferred their entire share in the land to Tirumala Tirupati Constructions (India) Pvt. Ltd. (“TTCIPL”). It was also submitted that both the brothers of the assessee transferred their share in the same land on the very same date by executing a separate GPA to the same buyer i.e. TTCIPL. ITA No.1125/Hyd/2024 7 5.1 It is further submitted that the assessee had already offered the capital gains arising from the said transaction in her return of income for Assessment Year 2011–12. However, the Ld. AO has taxed the income on the sale of same land under Section 147 r.w.s. 144 of the Act vide assessment order dated 11.12.2023. In this regard, the Ld. AR invited our attention to sale deed dated 16.03.2015 placed at page no.1A to 11 of the paper book on the basis of which the Ld. AO had again taxed the income on the sale of same land. The Ld. AR submitted that, the land referred to in the sale deed dated 16.03.2015 is part of the same land (2 acres out of the total 39 acres 11 guntas) that had already been sold by the assessee and her family members to TTCIPL in the year 2010. The sale deed dated 16.03.2015 shows that the land was sold by TTCIPL to Sri Nadipally Sri Ranga Rao, and the assessee along with her sisters and brothers were merely joined as vendors to provide better title, even though they had no continuing ownership rights as of 2015. Further, at para no. 3 of page no.3 of the sale deed, it is specifically acknowledged that the land had already been sold to the buyer on 19.04.2010, and the buyer is now exercising his rights as owner by selling a part of the land. Thus, it is clear that ITA No.1125/Hyd/2024 8 no fresh transfer of any land was made by the assessee in the financial year 2014–15 relevant to AY 2015–16. What has occurred is a subsequent sale by the TTCIPL, and the assessee’s name appears only to confirm the chain of title to the ultimate purchaser. 5.2 Further, the Ld. AR has placed on record the assessment order passed in the case of the assessee for AY 2011–12, wherein the capital gain arising from the original transfer of the land to the TTCIPL has already been assessed. The Ld. AR also submitted that, in the case of Smt. Ishrat Fatima Husain, one of the co-heirs and sisters of the assessee, reassessment proceedings under Section 147 were also initiated for AY 2015–16. However, no addition was made by the Ld. AO in her case in respect of the same transaction, which clearly shows inconsistent application of facts by the Revenue in similar matters. 5.3 Finally, the Ld. AR submitted that the addition made by the Ld. AO again in A.Y. 2015-16 resulted in double taxation in the hands of the assessee, which is not permissible under law. Accordingly, the Ld. AR prayed before the bench to delete the said addition. ITA No.1125/Hyd/2024 9 6. Per contra, the Ld. DR relying on the order of Ld. AO invited our attention to sale deed dated 16.03.2015, placed at page no.1A to 11 of the paper book and submitted that, the name of the assessee has been mentioned as vendor in the sale deed and total sale consideration of Rs.30 lakhs has been received by TTCIPL, who is an agent of the assessee. Hence, it cannot be denied that the assessee has not benefitted by such sale deed. He further argued that, no detailed map of the land sold was enclosed to the sale deed. Hence it cannot be stated that the sale of land is out of the same land of 39 acres 11 guntas. Finally, the Ld. DR submitted that, there is no infirmity in the order of Ld. AO. 7. We have heard the rival submissions and also gone through the record in the light of the submissions made by either side. The case of the assessee is that she along with her three sisters and two brothers were joint legal heirs to a total landholding of 39 acres 11 guntas inherited from their father. As per the partition, 50% of the land was to be held by her two brothers and 50% by the assessee along with her three sisters, thereby entitling each of them to 19 acres 25.5 guntas. We have gone through the GPA dated 19.04.2010, placed ITA No.1125/Hyd/2024 10 at page nos. 24 to 34 of the paper book and found that the assessee along with her three sisters had transferred their entire share in the land to TTCIPL. We also found that both brothers of the assessee transferred their share in the same land on the very same date by executing a separate GPA (page nos. 12 to 23 of the paper book). We have also gone through the assessment order passed u/s.144 r.w.s. 147 of the Act for A.Y. 2011-12 in the case of the assessee and found that the Ld. AO had already taxed the capital gains arising from the said transaction. We also found that, the same income has now been again assessed under Section 147 r.w.s. 144 vide assessment order dated 11.12.2023. 7.1 We have gone through the GPA dated 17.04.2010 as well as the sale deed dated 16.03.2015, placed at page nos. 1A to 34 of the paper book. On perusal of these documents, we find that the land referred to in the sale deed dated 16.03.2015 is part of the same land (2 acres out of the total 39 acres 11 guntas) that had already been sold by the assessee and her family members to TTCIPL on 19.04.2010. Further, the sale deed dated 16.03.2015 shows that the land was sold by TTCIPL to Sri Nadipally Sri Ranga Rao, and the assessee along with ITA No.1125/Hyd/2024 11 her sisters and brothers were merely joined as vendors to provide better title, even though they had no continuing ownership rights as of 2015. 7.2 We have also gone through para no.3 of page no.3 of the sale deed dated 16.03.2015, which is to the following effect : “WHEREAS originally one Late Hyder Ali Mirza S/o. Late Dr.Safdar Ali Mirza was the owner of land to an extent of Ac.14-25 guntas in Sy. No.310, Ac.13-03 guntas in Sy no.311 and Ac.11-24 guntas in Sy no.312, total comes to Ac.39-11 guntas situated at Budwel Village, Rajendra nagar Mandal, R R Dist. After the demise of Late Hyder Ali Mirza, his legal heirs have sold away the said land to an extent of Ac.19.25.5 Gts (out of Ac 39.11 Gts) to the Triumala Tirupati Constructions (India) Pvt Ltd and executed a registered Agreement of Sale Cum General power Of Attorney document bearing No 3034 of 2010 dated 19-04-2010 and to an extent of Ac 19.252 Gts ( out of Ac 39.11 Gts) executed a registered Agreement of Sale Cum General power Of Attorney document bearing No.3033 of 2010 dated 19-04- 2010 and delivered the physical possession of the land duly receiving the full sale consideration. There after the parties to the Doc No.3033 of 2010 dated 19-04-2010 have noticed that while executing the above document it was wrongly made the JMC Constructions Private Limited mentioned as vendee instead of the name of Triumala a Tirupati Constructions (India) Pvt Ltd. Therefore the parties to the said Document have executed a Rectification deed Document No:13603/2014 dated 17-11-2014 and Rectified the said mistake and the JMC Constructions Private Limited ratified the same ITA No.1125/Hyd/2024 12 through Document No.1281/2015, registered at R.O., R.R.Dist., thereby the Triumala Tirupati Constructions (India) Pvt Ltd i.e party no 7 herein became the owner of the land to an extent of AC 39.11 gts in Sy Nos.310 Ac.14-24guntas, Sy No.311 Ac.13-03 gutnas and in Sy No.312 Ac.11-24 guntas situated at Budwel Village, Rajendra nagar Mandal, R R Dist and are in possession and enjoyment of the same.” 7.3 On perusal of above, we found that, it is specifically acknowledged that the land had already been sold to the buyer on 19.04.2010, and the buyer is now exercising his rights as owner by selling a part of the land. Thus, it is clear that no fresh transfer of land was made by the assessee in the financial year 2014–15 relevant to AY 2015–16. What has occurred is a subsequent sale by the original buyer, and the assessee’s name appears only to confirm the chain of title to the ultimate purchaser. 7.4 Further, on perusal of the GPA dated 19.04.2010 as well as the sale deed dated 16.03.2015, placed at page nos. 1A to 34 of the paper book, we found that the Survey number and quantum of land area mentioned in sale deed as well as in GPA are the same. Hence, we are of the considered opinion that the land sold vide sale deed dated ITA No.1125/Hyd/2024 13 16.03.2015 is out of the same land which was sold by the assessee along with her relatives to TTCIPL vide GPA dated 19.04.2010. 7.5 Further, the Ld. AR has placed on record the assessment order passed in the case of the assessee for AY 2011–12, wherein the capital gain arising from the original transfer of the land to the TTCIPL has already been assessed. We also find that in the case of Smt. Ishrat Fatima Hussain, one of the co-heirs and sisters of the assessee, reassessment proceedings under Section 147 were also initiated for AY 2015–16. However, no addition was made by the Ld. AO in her case in respect of the same transaction, which clearly shows inconsistent application of facts by the Revenue in similar matters. 7.6 In view of the above facts, we are of the considered opinion that the land sold by the assessee along with her family members on 19.04.2010 to TTCIPL has already been taxed in AY 2011–12, and the same has been accepted by the Department. The subsequent mention of the assessee’s name in the sale deed dated 16.03.2015 is not indicative of a fresh transfer by the assessee, nor does it give rise ITA No.1125/Hyd/2024 14 to fresh capital gains in AY 2015–16. Therefore, the addition of Rs.69,14,289/- made under the head capital gains in AY 2015–16 is unsustainable and deserves to be deleted. Accordingly, we direct the Ld. AO to delete the said addition. 8. In the result, the appeal of the assessee is allowed. Order pronounced in the open Court on 18th July, 2025. Sd/- Sd/- (RAVISH SOOD) (MADHUSUDAN SAWDIA) JUDICIAL MEMBER ACCOUNTANT MEMBER Hyderabad. Dated: 18.07.2025. * Reddy gp Copy of the Order forwarded to : 1. Ms. Shamsu Ul Zoha Jermain, C/o Katrapati & Associates, 1-1- 298/2/B/3, Sowbhagya Avenue Apartments, 1st Floor, Ashok Nagar, Street No.1, Hyderabad-500 020 2. ITO, International Taxation-1, Hyderabad. 3. Pr.CIT, Hyderabad. / DRP 4. DR, ITAT, Hyderabad. 5. Guard file. BY ORDER, "