APSARA OSWAL,DELHI vs. COMMISSIONER OF INCOME TAX (APPEALS), NEW DELHI

Brief facts of the case are that the assessee filed her return of income declaring total income of Rs. 2,97,032/-. The case of the assessee was selected by Revenue for framing scrutiny assessment. Statutory Notices were issued by the AO. The assessee did not participated in the assessment proceedings. SCN was also issued by the assessee, but again there was no compliance. The AO passed an ex-parte assessment order in which he disallowed indexed cost of acquisition of property claimed by the assessee,as well cost of acquisition of the Mutual Funds were also denied by the AO. The income of the assesseewas assessed at Rs. 4,45,28,218/- as against the returned income of Rs. 2,97,032/-. The assessee filed first appeal with ld. CIT(A) ,but again there was no representation on behalf of the assessee and the appeal of the assessed was dismissed ex-parte by ld. CIT(A), wherein ld. CIT(A) did not adjudicated the issues arising in the appeal on merits but the same was dismissed in limine. assessee was not aware of the departmental proceedings. Inadvertently, the assessee was allotted two PAN by department. The assessee applied for cancellation of one PAN. The department has denied indexed cost of acquisition of the property. It was gifted by father-in-law, and different PAN was issued at that time when the assessee acquired the same, and now while selling the said property second PAN was used. Thus, due to this inadvertent use of two different PAN , use of one PAN while acquiring the property and use of second PAN while selling the property , has led to denial of the cost of acquisition of the property. The cost of acquiring Mutual Fund was also not allowed by the AO . Thus, the entire sale proceed of immovable property as well sale proceeds of Mutual Fund were brought to tax by the AO. The ld. CIT(A) dismissed the appeal of the assessee ex-partein liminewithout deciding the issues arising in the appeal. Prayers were made by ld. Counsel for the assesseeto set aside and restore the matter back to the file of the AO for denovo assessment on merits in accordance with law. Statement was made at Bar by the ld. Advocate who appeared on behalf of the assessee that if another opportunity is provided, the assessee will provide complete documents / information to enable assessing of the correct income in the hands of the assessee. denovo assessment.

After hearing both the parties and perusing the material on record, we set aside the entire matter back to the file of the AO for denovo assessment on merits in accordance with law, after providing proper opportunity of being heard to the assessee and after considering all the evidences/documents as may be submitted by the assessee during denovo assessment. We clarify that we have not commented on the merits of the issues arising in the appeal, and all the contentions are kept open.

In the result, appeal of the assessee is allowed for statistical purposes.