SAVITA MANGESH SHIRAWALE ,MUMBAI vs. ITO WARD 22(1)(6), MUMBAI

We have heard the parties and perused the materials on record. In so far as the quantum appeal being ITA No. 1578/Mum/2026 is concerned, the issue in dispute is addition made of Rs.64,75,500/- u/s 50C of the Act. 3. We have heard the parties and perused the materials on record. The assessee is a resident individual. The assessee and her husband were joint owners of an immovable property. The said property was sold in the year under consideration for a declared sale consideration of Rs.49,00,000/-. Whereas, for stamp duty purpose, the Stamp Valuation Authority determined the value at Rs.64,75,500/-. Upon receiving information regarding sale of property, the Assessing Officer (AO) reopened the assessment 147 of the Act. In course of assessment proceeding, AO called upon the assessee to explain why the value determined by the Stamp Valuation Authority should not be treated as deemed sale consideration for computing capital gain. As observed by the AO, the assessee did not comply to the statutory notices. Thus, the AO completed the assessment adding back an amount of Rs.64,75,500/- u/s. 50C of the Act. Whereas, the First appellate Authoeity dismissed the appeal on the ground of delay without examining the issue on merits. 4. Having considered rival submissions and perused materials on records. We find that assessee’s husband Shri Mangesh Maruti Shirawale had sold the immovable property jointly held with his wife, the present assessee, for a declared sale consideration of Rs.49,00,000/-. Whereas, the stamp value was determined Rs.64,75,500/-. In the return of income filed for the assessment year under dispute, the assessee though had disclosed the sale of immovable property, however, he has not offered any capital gain claiming deduction u/s. 54 of the Act. However, the AO completed the assessment u/s. 147 r.w.s. 144B of the Act vide order 09.05.2023 making addition u/s. 50C of the Act based on the stamp duty value. Thus, as could be seen from the facts on the record, the gain derived from the same transaction has been added both at the hands of husband and wife. This, in our view, is totally unacceptable. In course of hearing ld. Counsel for the assessee submitted that appeal filed by the husband is still pending before the First Appellate Authority. Since, assessee’s appeal was dismissed in limine on account of delay without hearing the assessee. These facts could not be brought to the notice of the First Appellate Authority. 5. Considering the above, we are inclined to set aside the order of learned first appellate authority and restore the issues back to him for de-novo adjudication after condoning the delay, preferably, along with the appeal of the husband Shri Mangesh Maruti sherawale, which is stated to be pending before the First Appellate Authority. This is so because, materials on record demonstrate that assessee’s husband has owned up the transaction of sale of immovable property in the return of income filed for the assessment year under dispute. Needless to mention, before deciding the appeal the assessee must be provided due and reasonable opportunity of being heard. Since, the order of the First Appellate Authority in quantum proceeding has been set aside, the orders passed by the First Appellate Authority in the penalty proceedings u/s 272A, 270A, 271F of the Act are also set aside and issues are restored back to the AO for considering afresh after decision is taken by the first appellate authority in the quantum proceeding. 6. In the result all the appeals are allowed for statistical purposes.