JAYESH ANANTRAI DOSHI,MUMBAI vs. ACIT, CIRCLE 41(2)(1), MUMBAI, MUMBAI

Brief facts are that the assessee had filed his return of income declaring income of ₹7,09,580. His case was selected for scrutiny on the basis of specific information concerning the transfer of immovable properties. During the relevant previous year, the assessee had transferred Office No. 604 at Levata, Nagdevi Street, Mumbai, for a stated consideration of ₹23,50,000 as against the stamp-duty valuation of ₹57,51,000. He had also transferred Office No. 302 at Narayan Dhuru Street, Mumbai, for a consideration of ₹76,00,000 as against its stamp-duty valuation of ₹77,67,203. The Assessing Officer adopted the respective stamp-duty values under section 50C and computed an aggregate long-term capital gain of ₹1,12,64,059. The assessee’s claim for exemption under section 54F, based upon an investment of ₹1,04,00,000 in a residential flat, was also denied for want of supporting evidence. Consequently, the assessment was completed under section 143(3) read with section 144B vide order dated 23.08.2021, determining the total income at ₹1,19,73,640. 3. The assessee carried the matter in appeal before the learned CIT(A). From the impugned order, it is seen that notices under section 250 were issued on 11.03.2024, 26.04.2024, 14.05.2024 and 07.06.2024. Since there was no compliance with these notices, the learned CIT(A) inferred that the assessee was not interested in prosecuting the appeal. After referring to certain

Before us, the appeal is delayed by 613 days. The assessee has filed an application seeking condonation of delay, supported by a duly sworn affidavit. The learned counsel submitted that the email address furnished by the assessee in Form No. 35 was “dmanish65@gmail.com”, whereas the notices issued during the appellate proceedings were transmitted to another email address, namely, “frsandasso@yahoo.co.in”, which belonged to the tax consultant who had merely assisted the assessee in filing the appeal. As the consultant’s engagement was confined to filing the appeal and there was no further communication between them, neither the notices of hearing nor the impugned order came to the assessee’s knowledge. It was further submitted that, in April 2026, the assessee and his group entities engaged M/s GPATS & Co., Chartered Accountants, for handling their statutory compliances, taxation matters and litigation. Upon reviewing the income-tax records, the newly appointed firm discovered that the first appellate order had already been passed on 12.07.2024 and had remained unattended. Immediately upon being apprised of these facts, the assessee took steps to institute the present appeal. The relevant correspondence concerning the appointment of the new professional firm and copies of the notices issued during the first appellate proceedings have also been placed on record. The

We have heard the rival submissions and perused the material placed before us. The explanation furnished by the assessee is supported by a sworn affidavit and contemporaneous documents. It is specifically stated that the notices were transmitted to an email address different from the one furnished in Form No. 35 and that the impugned order came to his knowledge only when the newly appointed Chartered Accountant undertook a review of his income-tax records. Nothing has been brought before us to show that this explanation is factually incorrect or lacking in bona fides. The assessee could derive no advantage by allowing an adverse appellate order involving an addition exceeding ₹1.12 crore to attain finality. The delay appears to have arisen from a breakdown in professional communication rather than from any conscious abandonment of the statutory remedy. Taking a cumulative view of the circumstances, we are satisfied that sufficient cause has been shown. Accordingly, the delay of 613 days is condoned and the appeal is admitted for adjudication.

Coming to the manner in which the first appeal has been disposed of, section 250(6) requires the order of the Commissioner (Appeals) to state the points for determination, the decision thereon and the reasons for such decision. Thus, even where an assessee fails to appear or does not furnish the required submissions, the learned CIT(A), being a statutory first appellate

In the present case, although the learned CIT(A) reproduced substantial portions of the assessment order and referred to the assessee’s failure to comply with the notices, there is no independent adjudication of the grounds challenging the adoption of stamp-duty valuation under section 50C, the nature of the rights transferred in one of the properties, the assessee’s request for a reference to the Valuation Officer, or the allowability of exemption under section 54F. The conclusion that there was no infirmity in the assessment order has been recorded principally on account of the absence of submissions and supporting evidence from the assessee. Such a disposal cannot be regarded as a determination of the appeal on merits in the manner contemplated under section 250(6).

At the same time, the issues raised by the assessee require verification of the underlying agreements, the precise nature of the rights transferred, the stamp-duty valuations, the objections stated to have been raised before the Assessing Officer, the indexed cost of acquisition and the documentary evidence concerning investment in the residential property. These matters

Accordingly, the impugned order is set aside and the appeal is restored to the file of the learned CIT(A), who shall decide each of the grounds raised by the assessee independently and in accordance with law, after affording a reasonable and effective opportunity of hearing. The assessee shall be at liberty to file the relevant agreements, valuation documents, evidence supporting the claim under section 54F and such other material as may be necessary for proper adjudication. If any additional evidence is tendered, the learned CIT(A) shall deal with the same in accordance with the applicable statutory provisions and, wherever considered necessary, obtain a remand report from the Assessing Officer.

We make it clear that we have not expressed any opinion on the merits of the additions or the claims raised by the assessee, and all issues are left open for determination by the learned CIT(A). The assessee is also directed to keep his particulars, including the registered email address and mobile number, duly updated on the income-tax portal, to respond to the notices within the stipulated time and to extend full cooperation in the restored proceedings. The learned CIT(A) shall thereafter pass a speaking and reasoned order in accordance with law.