ADITYA ANAND SARAF,PUNE vs. THE ITO, WARD 13(4), PUNE, PUNE

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ITA 2947/PUN/2025Status: DisposedITAT Pune25 May 2026AY 2016-173 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that the assessee was not liable for advance tax as his admitted tax liability was nil, with tax on salary being deducted at source. Therefore, the CIT(A) erred in dismissing the appeal on a technical ground.

What were the facts?

The assessee, a salaried individual, did not file an income tax return as he believed he had no taxable income after selling a flat and using the proceeds to buy another, with the balance financed by a loan. The CIT(A) dismissed his appeal for not paying advance tax.

What were the issues?

Whether the dismissal of the appeal by the CIT(A) on the ground of non-payment of advance tax was justified when the assessee had no admitted tax liability.

Which sections of the Income-tax Act were involved?

Section 147,Section 144,Section 250,Section 249(4)(b)

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 Appellant: Shri Vikas Agrawal
For Respondent: Shri Sandeep Sathe, JCIT

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 2016-17 on 30-09-2025, emanating from the Assessment Order u/s 147 r.w.s. 144 of the Act, dated 02-03-2024.

2.

Submission of Ld.AR: The Ld.AR filed a paper book containing 90 pages, including case laws. Ld.AR submitted that assessee had not filed return of income as there was no taxable income for the year. Ld.AR further submitted that Ld.CIT(A) had dismissed the appeal of the assessee on the ground that no advance tax has been paid by the assessee, following section 249(4)(b) of the Act. Ld.AR submitted that the assessee is a salaried person and TDS was deducted by the employer. During the year, assessee has purchased a flat. During the years, the assessee also sold a flat. The consideration received was utilized for acquiring the new property. Also part of it was

ITA No. 2947/PUN/2025

funded by obtaining loan. Therefore, there was no capital gains and hence, no advance tax liability. Therefore, Ld.CIT(A) erred in dismissing the appeal of the assessee in limine. Ld.AR relied on the following decisions: i. Dilip Hiralal Chaudhari vs. ITO in ITA No. 642/PUN/2024; ii. Sagar Jaywant Elawande vs. ITO in ITA No. 224/PUN/2025; iii. Chandra Financial Services Pvt. Ltd., vs. ACIT in ITA No. 4697/MUM/2024

3.

Submission of Ld.DR: The Ld.DR had no objection, if the matter is set aside to Ld.CIT(A).

4.

Findings and analysis: We have heard both the parties and perused the records. Assessee is an individual, salaried employee. In the Form No.35 in column No. 11, assessee has elaborately written facts. The relevant facts mentioned in Form No. 35 are as under: Quote “the assessee was employed with L.T.Foods Ltd., Delhi as a Sales Executive, due to the nature of his job, which involves continuous travelling the field work, the assessee was unable to file his income tax returns timely. During the year, assessee has purchased a new house property situated at Lohegaon, Pune on 17-08-2015 for Rs. 54,85,000/-. Prior to that assessee has sold his old house located at Dhanori, Pune for Rs. 27 lakhs. The said amount was invested in purchase of new property. Balance amount was financed through housing loan availed from HDFC bank. As the purchase of the new property was made against the sale of old property the assessee was under impression that the transaction would not attract any tax liability. The Income Tax Department issued notice u/s. 148A and initiated the assessment proceedings u/s. 147. Assessee was unable to submit a reply to the notice within the stipulated time frame due to pressing personal circumstances specifically the medical issues of his spouse which demanded immediate attention.”Unquote

Assessee also enclosed copy of sale and purchase agreement, Form No. 16, loan document along with Form No.35 filed before the Ld.CIT(A). However, the Ld.CIT(A) dismissed it on technical ground that assessee has not paid advance tax. It has been observed that as per the computation of income filed by the assessee, assessee was not liable for any advance tax. The tax was deducted at source on the salary income by his employer. In these facts and circumstances, on identical facts, ITAT, Pune in the case of Sagar Jaywant Elawande vs. ITO in ITA No. 224/PUN/2025, dt. 28-03-2025, has held that advance tax for the purpose of section 249(4)(b)

ITA No. 2947/PUN/2025

of the Act was advance tax on the basis of admitted tax liability. In the case of the assessee, admitted tax liability was NIL. Hence, there was no requirement of advance tax. Similar view has been taken in the case of Chandra Financial Services Pvt. Ltd., vs. ACIT in ITA No. 4697/MUM/2024, dt. 29-10-2024. In these facts and circumstances, Ld.CIT(A) has erred in dismissing the appeal of the assessee in limine. Accordingly, we set aside the order of the Ld.CIT(A) to Ld.CIT(A) for denovo adjudication. Ld.CIT(A) shall provide opportunity of hearing to the assessee.

5.

In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open Court on 25th May, 2026

Sd/- Sd/- (VINAY BHAMORE) (Dr. DIPAK P. RIPOTE) JUDICIAL MEMBER ACCOUNTANT MEMBER पुणे/Pune; दिन ांक/Dated : 25-05-2026 TNMM

आदेश की प्रतितिति अग्रेतिि/Copy of the Order is forwarded to: अपील र्थी / The Appellant 1. प्रत्यर्थी / The Respondent 2. 3. The concerned Pr.CIT, Pune 4. DR, ITAT, ‘SMC’ Bench, Pune 5. ग र्ड फ ईल / Guard file. आदेशानुसार/ BY ORDER, // True Copy // Assistant Registrar आयकर अपीलीय अदिकरण ,पुणे / ITAT, Pune

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