RAVI BORAIAH,BENGALURU vs. INCOME TAX OFFICER, BENGALURU

ITA 674/BANG/2026Status: DisposedITAT Bangalore28 September 2026AY 2015-165 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that the assessee was not afforded a proper opportunity of hearing before either the learned Assessing Officer or the learned CIT(A). The CIT(A) could not dismiss the appeal for non-prosecution, as section 251 of the Act requires the appeal to be decided on its merits even in the assessee’s absence. Therefore, the order of the CIT(A) was unsustainable. Furthermore, since the assessee was also denied an adequate opportunity before the Assessing Officer, remanding the matter to the CIT(A) would serve no useful purpose. In the interest of justice and with the consent of both parties, the Tribunal restored the entire matter to the file of the learned Assessing Officer. The assessee is to substantiate the taxability and quantum of capital gains with evidence, and the Assessing Officer is to verify and decide the matter afresh. The issue of penalty proceedings under section 271(1)(c) or 270A was not decided on merits.

What were the facts?

The assessee, Ravi Borahia, filed an appeal before the ITAT against an order dated 18 December 2025 passed by the National Faceless Appeal Centre, Delhi (CIT(A)). The CIT(A) had dismissed the assessee's appeal against a reassessment order dated 24 February 2023, passed by the Income Tax Assessment Unit under section 147 read with sections 144 and 144B of the Income-tax Act, 1961, for non-prosecution. The assessee had not filed a return for assessment year 2015-16. The case was reopened under section 147 after information of property sale. The assessee failed to comply with notices and disregarded seven notices. Consequently, the Assessing Officer passed an order under section 144, adding long-term capital gains of ₹5,719,021. The assessee's appeal before the CIT(A) was also dismissed for non-prosecution after failing to comply with three notices.

What were the issues?

1. Whether the order passed by the learned Commissioner of Income tax (Appeals) under section 250 of the Income tax Act, 1961, confirming the assessment order passed under section 147 read with sections 144 and 144B, is bad in law and on facts and liable to be quashed. The assessee argued that the CIT(A) erred in dismissing the appeal without adjudicating the grounds on merits and without granting a reasonable opportunity of being heard. The revenue did not record specific arguments on this point. 2. Whether the learned authorities below erred in treating the entire sale consideration of Rs.58,00,000 as income of the Appellant, without appreciating that the Appellant had entered into a registered Joint Venture Agreement providing for 50 and 50 sharing of sale proceeds. The assessee contended that only 50 percent of the sale consideration accrued to the Appellant, with the remaining portion belonging to the builder under the Joint Venture arrangement. The revenue did not record specific arguments on this point. 3. Whether the learned Assessing Officer erred in not allowing cost of construction and/or improvement while computing the capital gains. The assessee argued this resulted in excessive and incorrect computation of income. The revenue did not record specific arguments on this point.

Which sections of the Income-tax Act were involved?

Section 147,Section 144,Section 144B,Section 250,Section 251,Section 271(1)(c),Section 270A

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, BANGALORE BENCHES, BANGALORE

Before: SHRI PRASHANT MAHARISHI & SHRI SOUNDRARAJAN K.

PER SHRI PRASHANT MAHARISHI, VICE PRESIDENT

1.

This appeal, relating to assessment year 2015–16, filed by Borahia Ravi [ the Assessee/ Appellant] is directed against the appellate order dated 18 December 2025 passed by the National Faceless Appeal Centre, Delhi (the learned CIT(A)). By that order, the assessee’s appeal against the reassessment order dated 24 February 2023, passed by the Income Tax Assessment Unit under section

The order continues below.

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