MS. NARGIS PEERANI,CANADA vs. DEPUTY COMMISSIONER OF INCOME-TAX, ASMNT CIRCLE-2(1), BENGALURU

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ITA 609/BANG/2023Status: DisposedITAT Bangalore11 October 2023AY 2020-214 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal found that the Assessing Officer (AO) had not verified the claim. Therefore, in the interest of justice, the issue was remitted back to the AO for fresh examination with a direction for the assessee to produce supporting evidence.

What were the facts?

The assessee claimed a brokerage expense of Rs. 3,60,000/- for computing long-term capital gain on the transfer of an apartment. This claim was not addressed in the draft assessment order but was disallowed by the Dispute Resolution Panel (DRP).

What were the issues?

Whether the brokerage expense claimed by the assessee for computing capital gains is allowable as a deduction. Whether the AO properly examined the claim before its disallowance by the DRP.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 144C(13)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘B’ BENCH : BANGALORE

Before: SHRI CHANDRA POOJARI & SMT. BEENA PILLAI

For Appellant: Ms. Sunaiana Bhatia, C.A
For Respondent: Shri Subramanian S, JCIT(DR)
Hearing: 11.10.2023Pronounced: 11.10.2023

O R D E R Per Chandra Poojari, Accountant Member

This appeal by the assessee is directed against the order passed by the AO u/s 143(3) r.w.s 144C(13) of the Income-tax Act, 1961 dated 23/06/2023 for the assessment year 2020-21.

2.

The only issue in this appeal is with regard to disallowance of Rs.3,60,000/- claimed as brokerage to M/s Max Properties. The assessee claimed expenditure of Rs.3,60,000/- while declaring long term capital gain for the year under consideration by way of transfer of rights held by the assessee in respect of Apartment No.4113, Prestige Neptune’s Courtyard developed in land bearing Sy. No.843, Ernakulam Village, Cochin. This claim was not dealt in the draft assessment order passed by the AO. However, the DRP took up the issue and disallowed the same.

3.

Against this, the assessee is in appeal before us.

4.

The ld.AR submitted that this amount of Rs,3,60,000/- paid to Max Properties on 30/05/2019 by way of cheque bearing No.96298 drawn on Axis Bank towards commission and the same has to be allowed as deduction while computing the capital gain on transfer of said property.

5.

We have heard the rival submissions and perused the materials on record. In our opinion, this issue requires examination at the end of the AO, as he has not verified the same. Hence, in the interest of justice, we remit the issue back to the file of the AO to examine the claim of the assessee with a direction to the assessee to produce necessary evidences in support of her claim of payment of commission. Accordingly, this issue is remitted to the file of AO for fresh consideration in accordance with law.

6.

In the result, the assessee’s appeal is partly allowed for statistical purposes.

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