NARUKA FARMS AND RESORTS PVT LTD,JAIPUR vs. INCOME TAX OFFICER, JAIPUR

P a g e | 1 ITA No. 918/JPR/2025 Naruka Farms and Resorts Pvt. Ltd

IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, “B” BENCH, JAIPUR BEFORE SHRI SANJAY GARG, JUDICIAL MEMBER & SHRI RATNESH NANDAN SAHAY, ACCOUNTANT MEMBER ITA No. 918/JPR/2025 (Assessment Year: 2014-15)

Naruka Farms and Resorts Vs. ITO Pvt. Ltd Ward 6(1) Plot No. 69, Nand Vihar Jaipur Sidharth Nagar, Jawahar Circle Jaipur Malviya Nagar 302017 �थायीलेखासं./जीआइआरसं./PAN/GIR No: AAACN6391E Appellant .. Respondent

Appellant by : Sh. S.L. Poddar, Adv Respondent by : Mrs. Alka Gautam, CIT-DR

Date of Hearing 26.03.2026 Date of Pronouncement 08.06.2026 O R D E R Per Sanjay Garg, Judicial Member: The present appeal has been preferred by the assessee against the order of National Faceless Appeal Centre (NFAC)/Ld. Commissioner of Income Tax (Appeals) (hereinafter referred to as “Ld. CIT(A)”)

P a g e | 2 ITA No. 918/JPR/2025 Naruka Farms and Resorts Pvt. Ltd

dated 21.05.2025 u/s 250 of the Income Tax Act,1961 (hereinafter referred to as “Act”). 2. The assessee in this appeal has taken following grounds of appeal:- “1. In the facts and circumstances of the case and in law, Ld. CIT(A) has erred in confirming the action of the Ld AO in reopening the assessment of the assessee u/s 147, the action of ld. AO is illegal, unjustified, arbitrary and against the facts of the case. Relief may please be granted by quashing the proceedings being illegal and without jurisdiction. 2. In the facts and circumstances of the case and in law, Ld. CIT(A) has erred in confirming the action of the Ld AO in issuing notice under Section 148 of Income Tax Act, 1961 without obtaining proper sanction under Section 151 of Income Tax Act, 1961. The action of ld. AO is illegal, unjustified, arbitrary and against the facts of the case. Relief may please be granted by quashing the proceedings being illegal and without jurisdiction 3. In the facts and circumstances of the case and in law, Ld. CIT(A) has erred in confirming the action of the Ld AO in calculating the capital gain of Rs.4,84,90,770. The action of ld. AO is illegal, unjustified, arbitrary and against the facts of the case. Appropriate relief may please be granted. 4. In the facts and circumstances of the case and in law, Ld. CIT(A) has erred in confirming the action of the Ld AO in treating land situated at Village Prahladpura, Tehsil Sanganer Zila, Jaipur, as capital asset u/s 2(14) of Income Tax Act, 1961. The action of ld. AO is illegal, unjustified, arbitrary and against the facts of the case. Appropriate relief may please be granted. 5. The assessee company craves its rights to add, amend or alter any of the grounds on OR before the hearing.” 3. The brief facts of the case are that the assessee entered into an agreement for sale of the land with ‘Girnar Land Developers’. The assessee, however, did not file the return of income u/s 139(1) of the Act. The Assessing Officer (in short, “the AO”) noted that, the assessee had entered into land sale agreement with the developer but did not offer the capital gains tax on such sales, he therefore, reopened the assessment of the assessee for the year under consideration u/s 147/148 of the Act. 4. At this stage, the Ld. AR of the assessee has pointed out that, in fact, the Assessing Officer (AO) was of the belief that the assessee had made

P a g e | 3 ITA No. 918/JPR/2025 Naruka Farms and Resorts Pvt. Ltd

unexplained investment in purchase of land and therefore, reopened the assessment, whereas, the fact was that the assessee had, in fact, had sold the land in question. The Ld. Counsel, therefore, has contended that the reasons recorded by the AO of escapement of income, were factually incorrect and hence, the reopening of assessment was bad in law. 5. The Ld. DR, however, has submitted that this was only a clerical mistake occurred in the form/letter for seeking the approval of the competent authority, wherein, it was inadvertently written that the assessee had made undisclosed investment in immovable property, whereas, the facts on the file suggested that it was a case of sale of land and not offering of the capital gains earned thereon for taxation. However, we at this stage are not inclined to decide this legal ground, as the case can be well decided on factual merits. 6. During the assessment proceedings, the assessee explained before the AO that the entire deal of sale of the land did not mature as there was litigation between the parties. Further, that as per the directions of the Court, only part sale/transfer of land has been done. That the rest of the land has been retained as such with the assessee, for which no sale transaction has been executed, and therefore, the assessee is liable to pay the tax only in respect of only the part of the land which has been transferred. That since, the agreement relating to the transfer of the rest of the land, stood cancelled and the deal did not mature, therefore, no capital gain tax should be levied on the assessee in respect of that left

P a g e | 4 ITA No. 918/JPR/2025 Naruka Farms and Resorts Pvt. Ltd

out part. The Ld. AR has further submitted that in the return filed in response to notice u/s 148 of the Act, the assessee, inadvertently, has offered the capital gains tax on the sale consideration agreed of the entire land, however, since during the assessment proceedings, it was brought out to the notice of the AO that after decision of the civil court on the litigation between the parties, only part of the land has been transferred and there was no subsisting/surviving agreement relating to the other parcel of the land, therefore, the excess capital gains tax offered by the assessee may be refund to the assessee. The learned counsel, in this respect has referred to page 10 to 16 of the paper book to submit that such submissions were duly made before the AO. However, he pointed out that in the assessment order, the AO did not consider the said submissions and proceeded to pass the assessment order accepting the returned income of the assessee. 7. Being aggrieved by the said order of the AO, the assessee preferred the appeal before Ld. CIT(A) and again pointed out the aforesaid factual aspects. The Ld. CIT(A), however, relying upon the decision of Hon’ble Supreme Court in the case of “Goetz India Ltd.” (284 ITR 323) held that the assessee was supposed to file the ‘revised return’ and not the ‘revised claim’ during the assessment proceedings, and therefore, the AO was justified in not accepting the claim of the assessee. He, therefore, dismissed the aforesaid ground taken by the assessee.

P a g e | 5 ITA No. 918/JPR/2025 Naruka Farms and Resorts Pvt. Ltd

P a g e | 6 ITA No. 918/JPR/2025 Naruka Farms and Resorts Pvt. Ltd

which he failed to exercise. In view of this, the impugned order of the Ld. CIT(A) is set aside and the matter is restored to the file of AO with a direction to verify the claim of the assessee and charge only the legitimate taxes/capital gains tax, up to the extent of which the transfer of land has taken place and refund to the assessee the excess tax paid by him. 9. With the above observations, the appeal of the assessee is treated as allowed for statistical purposes.

Order is pronounced under provision of Rule 34 of ITAT Rules, 1963 on 08.06.2026

Sd/- Sd/- (Ratnesh Nandan Sahay) (Sanjay Garg) Accountant Member Judicial Member Dated 08.06.2026 Mittali, Sr. PS True Copy Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT By Order, Asst. Registrar ITAT, Jaipur