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Facts
The assessee's appeal for AY 2023-24 arose against an order involving proceedings under Section 143(1) of the Income-tax Act. The lower authorities disallowed the assessee's claim for cost of improvement amounting to Rs. 30,28,412/-.
Held
The Tribunal held that a debatable issue requiring supportive evidence could not be summarily disallowed under Section 143(1). Therefore, the matter was restored to the Assessing Officer for fresh adjudication.
Key Issues
Whether a claim for cost of improvement, requiring substantial evidence, can be disallowed summarily under Section 143(1) processing.
Sections Cited
143(1), 143(3)
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Income Tax Appellate Tribunal, DELHI BENCH: “SMC” NEW DELHI
Before: SHRI SATBEER SINGH GODARA
Assessment Year: 2023-24 Vs. Deputy Director of Income Acquire Infrastructure Pvt. Ltd., Tax, Third Floor, CPC, Bengaluru Dr. Gopal Das Bhawan, 28, Barakhamba Road, New Delhi PAN :AAKCA5294R (Appellant) (Respondent) Assessee by Sh. Pranshu Goel, CA & Sh. Aditya Gupta, Adv. Department by Sh. Akhilesh Kumar Yadav, Sr. DR Date of hearing 05.06.2025 Date of pronouncement 05.06.2025 ORDER This assessee’s appeal for assessment year 2023-24, arises against the Commissioner of Income Tax (Appeals)/Addl./JCIT(A), Madurai’s DIN and order no. ITBA/APL/S/250/2024- 25/1074161556(1), dated 07.03.2025 involving proceedings under section 143(1) of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’). Heard both the parties. Case file perused.
It emerges during the course of hearing at the outset that both the learned lower authorities have disallowed the assessee’s claim of cost of improvement for the purpose of computing index cost of the capital asset amounting to Rs.30,28,412/-; in the CPC’s 143(1) processing dated 06.12.2023 and upheld in the lower appellate discussion.
That being the case, the tribunal is of the considered view that such a debatable issue requiring the assessee’s supportive evidence at length could not have been summarily disallowed in section 143(1) processing; and, therefore; it is deemed appropriate in the larger interest of justice to restore the same back to the learned Assessing Officer for his afresh appropriate adjudication within three effective opportunities of hearing at the appellant’s risk and responsibility, in consequential proceedings. Ordered accordingly.