SAJINDRA SINGH,PATNA vs. ITO WARD 6(5), PATNA

ITA 161/PAT/2026Status: DisposedITAT Patna25 August 2026AY 2011-1231 pages
AI SummaryRemanded

What were the facts?

The assessee, Sajindra Singh, is appealing an order by the CIT(A) NFAC dated January 27, 2026, which confirmed an assessment order passed by the Assessing Officer (AO) under Section 144 of the Income Tax Act, 1961. The AO initiated reassessment proceedings based on information from the Registrar of Properties, Patna, indicating the assessee entered into a Joint Development Agreement (JDA) on February 11, 2011, during Assessment Year 2011-12. The AO sought substantiation of the JDA and its implications under Section 2(47)(v), 45, and 48 of the IT Act. The assessee was allegedly non-responsive, leading the AO to compute Long Term Capital Gains (LTCG). The CIT(A) dismissed the assessee's appeal, finding failure to provide supporting evidence to claim the assessee was a mere agent.

What did the Tribunal hold?

The Tribunal noted that the AO assessed LTCG due to the assessee's failure to produce documentary evidence, and the CIT(A) also held the assessee failed to provide proof of being a mere agent. Before the Tribunal, the assessee filed a sale deed and power of attorney establishing that the assessee was an agent of the owner, Shri Chandra Prakash, and not the real owner. The Tribunal acknowledged that Sri Sajindra Singh is not the real owner and Shri Chandra Prakash is the landowner, unless he is a benamidar. It was observed that factual verification is required, especially as the revenue also filed written submissions. The Tribunal found that the assessee failed to produce documentary evidence before the lower authorities. Considering these facts, the Tribunal decided to restore the appeal to the CIT(A) for fresh consideration. The CIT(A) is directed to consider the assessee's submissions, peruse the documents filed by the assessee, examine the written submissions of the revenue, and pass a fresh order. The order passed by the CIT(A) is set aside, and the appeal is remitted back to the file of the CIT(A).

What were the issues?

1. Whether the CIT(A) erred in confirming the assessment order passed by the AO under Section 144 read with Section 147 of the Income Tax Act, 1961, and whether the reopening of assessment under Section 147/148 was valid, given that the conditions for assuming jurisdiction were not satisfied? (Question of law and fact, concerning Section 147/148). 2. Whether the CIT(A) erred in upholding the AO's ex-parte assessment under Section 144 without providing adequate opportunity, violating principles of natural justice? (Question of fact, concerning principles of natural justice). 3. Whether the CIT(A) erred in holding that the Joint Development Agreement dated February 11, 2011, resulted in a transfer of a capital asset within the meaning of Section 2(47)(v) read with Section 53A of the Transfer of Property Act, and that no effective transfer occurred in the relevant previous year, thus no capital gain arose in AY 2011-12? (Question of law and fact, concerning Section 2(47)(v) and Section 53A of TP Act). 4. Whether the CIT(A) erred in confirming the computation of LTCG based on estimated consideration, which was arbitrary and without basis? (Question of fact, concerning computation of capital gains). 5. Whether the CIT(A) erred in holding that the assessee acted only as a Power of Attorney holder/agent and not the real owner, making capital gains provisions inapplicable? (Question of fact, concerning ownership and applicability of capital gains provisions). 6. Whether the CIT(A) erred in upholding the invocation of Section 50C and determining LTCG of Rs. 68,98,500/-? (Question of law and fact, concerning Section 50C). 7. Whether the CIT(A) failed to consider that capital gain arises in the year possession of constructed portion is handed over, not upon execution of the JDA? (Question of law, concerning timing of capital gain accrual). Assessee's contentions: The assessee argued that he acted merely as a Power of Attorney holder/agent for the real owner, Shri Chandra Prakash, and not the land owner. Therefore, capital gains tax should not be applicable to him. The assessee relied on the Supreme Court judgment in Suraj Lamp & Industries (P) Ltd. v. State of Haryana & Anr. (2012) 340 ITR 1 (SC) to assert that a power of attorney is not an instrument of transfer and the tax incidence remains with the principal/landowner. The assessee also contended that capital gains arise in the year of possession handover, not JDA execution. The assessee sought a direction for the landowner to be assessed. Revenue's contentions: The judgment records that the revenue filed written submissions but does not detail their specific arguments beyond the AO's initial assessment and the CIT(A)'s confirmation.

Which sections of the Income-tax Act were involved?

Section 144,Section 147,Section 148,Section 2(47)(v),Section 45,Section 48,Section 53A,Section 50C,Section 234A,Section 234B

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “DB” BENCH, PATNA

Before: Shri Pradip Kumr Choubey & Shri Rakesh Mishra

Per Pradip Kumar Choubey, Judicial Member:

The present appeal has been preferred by the assessee against the order of the CIT(A) of the National Faceless Appeal Centre (NFAC) dated 27.01.2026 of the Income Tax Department [hereinafter referred to as ‘CIT(A)] u/s 144 of the Income Tax Act,

1961.

Assessment Year- 2011-12

2.

The brief facts of the case of the assessee is tha

The order continues below.

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