LATE KAILASH CHANDRA PAREEK,KOTA vs. ITO, WD 2(2), KOTA

IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, “SMC” BENCH, JAIPUR BEFORE SMT. ANNAPURNA GUPTA, ACCOUNTANT MEMBER ITA No. 995/JPR/2025 (Assessment Year: 2013-14)

Late Kailash Chandra Vs. ITO Pareek Ward 2(2), NR. BE.D College, Kota Sakatpura, Kota �थायीलेखासं./जीआइआरसं./PAN/GIR No:ACSPP 4230 H Appellant .. Respondent

Appellant by : None Respondent by : Sh. Gaurav Awasthi, JCIT

Date of Hearing 04.06.2026 Date of Pronouncement 25.06.2026 O R D E R The present appeal has been filed by the assessee against the order passed by the National Faceless Appeal Centre (hereinafter referred to as “Ld. CIT(A)”), dated 27.05.2025 u/s 250 of the Income Tax Act, 1961,(hereinafter referred to as “the Act”). 2. None has appeared on behalf of the assessee. I therefore proceeded to hear the matter with the assistance of the Ld. DR. 3. The grounds of the appeal raised by the assessee read as under:- 1. That the order dated 27.05.2025 passed by Ld. CIT(A)-NFAC is null and void ab initio, as it has been passed in the name of Late Shri Kailash Chandra Pareek, who had

P a g e | 2 ITA No. 995/JPR/2025 Late Kailash Chandra Pareek already passed away on 02.06.2023.The order was passed despite prior intimation and legal heir substitution approved on the e-filing portal on 14.10.2024, rendering if without jurisdiction and unenforceable in law. 2. That the Ld. CIT(A) further failed to substitute surviving legal heirs after the death of Smt. Indra Devi (on 01.03.2025), despite knowledge andrecord of both deaths, thereby violating the fundamental principles of natural Justice. 3. That the reassessment proceedings initiated u/s 147 end notice u/s 148 dated 31.03.2021 are time-barred and bad in law in view of amended Section 149(1)(b), as the alleged escaped income is below ₹50 lakhs 4. That the Ld. CIT(A)-NFAC erred in confirming the disallowance of indexed cost of improvement of ₹9,60,255/- while computing LTCG, without appreciating the genuineness of the claim substantiated through valuation reports and available bills. That the Ld. CIT(A) erred in treating the valuer's report as insufficient and failed to make any enquiry, physical inspection or verification to disprove the actual improvements made in the property. 5. The appellant reserves the right to add, amend or withdraw any ground at the time of hearing 4. However on going through the orders of the Authorities below, I find that the assessment order passed in the present case was without jurisdiction. On going through the assessment order I have noted that the order was passed in reassessment proceedings u/s 147 of the Act. The reasons for reopening the case of the assessee was filed before me and was on record, mentioning that the assessee had sold immovable property during the year for Rs.25,01,100/- while its stamp duty value was determined at Rs.29,46,927/-. The reasons note the assessee to have not declared the sale consideration in the return filed for the year under consideration under the head Capital Gain and as having declared only Long Term Capital Gain of Rs.8,967/-. Therefore, he noted that since it was not ascertainable as to what amount of sale consideration had been taken for determining the capital gain, the AO recorded that sale consideration relating to stamp duty value of the

P a g e | 3 ITA No. 995/JPR/2025 Late Kailash Chandra Pareek property ,to the extent of the assesses share had escaped assessment, i.e. 1/3rd of Rs.29,46,927/-, amounting to Rs.9,82,309 /- . Recording such reasons he assumed jurisdiction to reopen the case of the assessee. The reasons so recorded by the AO, are reproduced hereunder:- As per information received from the Director of Income-tax (I&CI), Kota vide letter no. 1473 dated 14/11/2014. As per above mentioned information, the transactions of transfer of immovable properties as recorded by the Sub-Registrars for the F.Y 2012-13, the value adopted for the purpose of stamp duty is more than sale value declared in the agreement to sell. In this case, the assessee had sold an immovable property jointly with two other persons for the sale value of Rs. 25,01,000/- during the FY 2012-13. But stamp value of the said property was determined at Rs.29,46,927/-. Therefore, the difference the face value & stamp value is comes to Rs.4,45,927/-. Further, the assessee did not declare the sale consideration in the return filed during the year under consideration under the head Capital Gain. He has only declare the LTCG amount of Rs.8,967/- but did not ascertain that what amount of sale consideration has been taken on account. In view of above sale consideration to the extent of his share i.e. Rs. 9,82,309/- (2946927/3) is escaped income of the assessee. Thus it is cleared that the assessee is under computation of income to the tune of Rs.9,82,309/-(2946927/3)as his share in the above sale consideration is one third. 5. On going through the assessment order, however, I find that the AO at para 5 of his order clearly notes that in the return of income filed by the assessee the assessee had taken the stamp duty value as per Section 50C of the Act for computing its long term capital gain on sale of immovable property. The contents of para 5 of assessment order are reproduced as under:- 5. The assessee has filed return of income declaring taxable income at Rs. 2,49,736/- under the head Salary (Pension), Long, term Capital Gain and income from other sources. The long-term capital Gain was declared at Rs. 8,967/-. The assessee has taken value u/s 50C, claimed expenses and indexation cost of purchases and further construction of property. The calculation shown in the computation of income is as under:

P a g e | 4 ITA No. 995/JPR/2025 Late Kailash Chandra Pareek

P a g e | 5 ITA No. 995/JPR/2025 Late Kailash Chandra Pareek conducting fishing and roving inquiries. There has to be a belief of the AO of escapement of the income and reopening cannot be restored to on a mere suspicion or for purposes of verification. 9. The above facts were confronted to the Ld. DR, who was unable to contradict the same nor controvert the proposition of law regarding valid reopening as noted above. 10. In view of the same, I have no hesitation in holding that the jurisdiction assumed by the AO to reopen the case of the assessee was not in accordance with law. The order passed as a consequence u/s 147 of the Act is held to be invalid and quashed. 11. Since the assessment order has been quashed I see no reason to deal with the merits of the case being a mere academic exercise. 12. In effect, the appeal of the assessee is allowed in above terms. Order pronounced in the open court on 25.06.2026

Sd/- (Annapurna Gupta) ACCOUNTANT MEMBER Dated 25.06.2026 Mittali, Sr. PS Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT

P a g e | 6 ITA No. 995/JPR/2025 Late Kailash Chandra Pareek By Order, Asst. Registrar ITAT, Jaipur