NANDKUMAR SHELAR,INDAPUR vs. INCOME TAX OFFICER, PUNE

ITA 2946/PUN/2026Status: DisposedITAT Pune22 September 2026AY 2015-1618 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the assessee is eligible for deduction under Section 54B of the Act. The Tribunal observed that capital gains are deemed to have been earned on the transfer of land as per Section 2(47) of the Act, even if registration of the sale deed is not necessary. Consequently, if the transfer is complete for the seller, the purchase is also complete for the buyer. The Tribunal found that the assessee had complied with the conditions of Section 54B by utilizing the sale consideration from the sale of agricultural land for purchasing other agricultural land within the prescribed period. Therefore, the Tribunal set aside the findings of the Learned CIT(A) and allowed the grounds of appeal raised by the assessee. The Assessing Officer was directed to grant the benefit of deduction under Section 54B. The issue regarding the validity of the notice under Section 148 was implicitly decided in favour of the assessee by allowing the appeal on merits, although not explicitly discussed in the provided excerpt.

What were the facts?

The assessee, Nandkumar Shelar, filed an appeal against the order of the Commissioner of Income Tax (Appeals), NFAC, Delhi, for Assessment Year (AY) 2015-16. The appeal stemmed from an assessment order passed under Section 147 read with Section 144B of the Income Tax Act, 1961. The assessee raised an additional ground challenging the validity of the notice under Section 148. The assessee sold agricultural land on 04.07.2014 for Rs. 28,71,000/- and reinvested the capital gains by purchasing new agricultural land on 25.04.2016 for Rs. 23,32,000/-, claiming a deduction under Section 54B. Reassessment proceedings were initiated based on information from the Insight Portal indicating a sale of immovable property for Rs. 57,42,000/-, which the assessee contended was erroneous and double the actual sale consideration. Notices under Section 148A(b) were issued on 19.03.2022 and 24.03.2022. An order under Section 148A(d) and a notice under Section 148 were issued on 04.04.2022.

What were the issues?

1. Whether the notice under Section 148 dated 04.04.2022 is void ab initio and without jurisdiction on the ground of limitation, considering the provisions of Section 149(1)(b) as they stood before substitution by the Finance Act, 2021, and the first proviso to Section 149(1) as substituted. Assessee's Contention: The assessee argued that the maximum limitation period of six years under the old Section 149(1)(b) for AY 2015-16 expired on 31.03.2022. The notice under Section 148 was issued on 04.04.2022, after this expiry. The first proviso to the substituted Section 149(1) prohibits issuing a notice if it could not have been issued under the old provisions due to the expiry of the limitation period. The assessee relied on the ITAT Pune decision in Nitin Arjun Pawar v. ITO and the Supreme Court decision in Union of India v. Rajeev Bansal. Revenue's Contention: The Revenue relied on the orders of the Assessing Officer and the Learned CIT(A).

Which sections of the Income-tax Act were involved?

Section 147,Section 144B,Section 148,Section 148A,Section 149(1)(b),Section 149(1),Section 54B,Section 2(47),Section 139(1),Section 139(4)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, PUNE BENCH “SMC”, PUNE

Before: SHRI Dr. DIPAK P. RIPOTE & SHRI VINAY BHAMORE

For Respondent: Shri Prashant Barate

PER Dr. DIPAK P. RIPOTE, A.M :

This is an appeal filed by the assessee against the order of the Learned Commissioner of Income Tax (Appeals), NFAC, Delhi [Ld.CIT(A)], passed u/s. 250 of the Income Tax Act, 1961 (the Act’) for AY 2015-16 on 08.04.2026, emanating from the Assessment Order u/s 147 r.w.s 144B of the Act, dated 13.03.024. Submission of Ld. AR:

2.

The Ld. AR raised additional ground under Rule 11 of the ITAT Rules. The additional ground is under : “Validity of Notice under Section 148

On the facts and in the circumstances of the case and in law, the learned CIT(A) erred in upholding the validity of the reassessment proceedings and failed to appreciate that the notice under Section 148 of the Act dated 04.04.

The order continues below.

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