SHASHI VASANT SHASTRI,NAGPUR vs. ASSISSTANT COMMISSIONER OF INCOME TAX CENTRAL CIRCLE-2(1), NAGPUR

ITA 360/NAG/2025Status: DisposedITAT Nagpur27 March 2026AY 2013-148 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that mere receipt of money under an agreement to sell does not automatically result in taxable income. Since no sale deed was executed, no transfer occurred as per Section 2(47) of the Act, and the amount retained the character of an advance. Furthermore, the assessment was vitiated due to the absence of a mandatory notice under Section 143(2) of the Act.

What were the facts?

The assessee received ₹94,76,000 (₹17,00,000 by cheque and ₹77,76,000 in cash) as an advance against an agreement to sell a property. The sale deed was not executed, and possession was not handed over. The Assessing Officer (AO) treated this amount as 'income from other sources' and made an addition.

What were the issues?

Whether the advance received for a property sale, where the transaction did not materialize, is taxable as 'income from other sources', and if the assessment is valid without a notice under Section 143(2).

Which sections of the Income-tax Act were involved?

Section 132,Section 143(3),Section 147,Section 148,Section 250,Section 2(47),Section 2(24),Section 51,Section 143(2)

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Cases cited in this judgment(1)Show list

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Income Tax Appellate Tribunal, NAGPUR BENCH :: NAGPUR

For Appellant: Ms. Veena Agrawal, CA
For Respondent: Shri Surjit Kumar Saha, Sr. DR
Hearing: 26.02.2026Pronounced: 27.03.2026

PER KHETTRA MOHAN ROY, AM: This appeal by the assessee is directed against the order of Ld. Commissioner of Income Tax (Appeals)-3, Nagpur, dated 28/03/2025 passed under section 250 of the Income Tax Act, 1961 (for short, “Act”) which is arising out of assessment order passed u/s. 143(3) r.w.s. 147 of the Act dated 21.03.2022 for the Assessment Year 2013-14. ITA No. 360/NAG/20245 (Shashi Vasant Shastri)

2.

Facts of the case in brief are that assessee is an individual and not filed her return of income. Based on the information from Investigation Wing, Nagpur, search and seizure action u/s. 132 of the Act was conducted at the residential premises of Mr. Roshan Dhore where certain incriminating documents were foun

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