BEERAM VIJAYA BHASKAR REDDY,HYDERABAD vs. DCIT, CIRCLE -2(1), HYDERABAD

ITA 952/HYD/2026Status: DisposedITAT Hyderabad30 September 2026AY 2009-1016 pages
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What were the facts?

The assessee, Beeram Vijaya Bhaskar Reddy, filed an appeal against the order of the CIT(A) for assessment year 2009-2010. This was the second round of appeal, as the ITAT had previously remanded the matter to the Assessing Officer (AO) by an order dated 28.02.2018. The assessee challenged the validity of the assessment order dated 27.12.2019 passed by the AO, contending it was barred by limitation under Section 153(3) of the Income Tax Act. The assessee also argued that the AO erred in treating long-term capital gain as short-term capital gain and consequently disallowed deduction under Section 54F. The dispute involved the period for which the property was held and its valuation.

What did the Tribunal hold?

The Tribunal held that the assessment order was not barred by limitation. The CIT(A) correctly noted that the ITAT's order dated 28.02.2018 was received by the Commissioner's office on 16.04.2018. As per Section 153(3), the limitation period is reckoned from the end of the financial year in which the order is received. Since it was received in FY 2018-19, the limitation expired on 31.12.2019, making the assessment order dated 27.12.2019 valid. Regarding the merits, the Tribunal found that the AO erred in not properly verifying the assessee's claim of advance payment made in 2001. The AO rejected the claim solely based on the sale deed not mentioning it, without conducting further inquiry. The Tribunal considered the payment of Rs. 4 lakhs via cheque on 21.03.2001 as evidence of investment in 2001, thus making the sale a long-term capital gain. Consequently, the assessee is eligible for deduction under Section 54F. The Tribunal also directed the AO to re-examine the valuation of the land as per the ITAT's earlier directions, considering the probable construction cost as of May 2008 or the SRO value of the land as on the date of the JDA. The grounds of appeal were considered partly allowed for statistical purposes.

What were the issues?

1. Whether the assessment order dated 27.12.2019 passed by the AO, giving effect to the ITAT's order dated 28.02.2018, is barred by limitation under Section 153(3) of the Income Tax Act, 1961. - Assessee's contention: The assessment order is barred by limitation as it was not passed within the prescribed period. - Revenue's contention: The order was passed within the period of limitation, as the ITAT's order was received by the department on 16.04.2018. 2. Whether the AO erred in treating the long-term capital gain as short-term capital gain and disallowing deduction under Section 54F, by not considering the property held by the assessee for more than 36 months and documentary evidence of advance payment made in 2001. - Assessee's contention: The property was held since 2001, making it a long-term capital asset, and therefore eligible for deduction under Section 54F. The AO failed to consider documentary evidence of advance payment and the ITAT's directions on valuation. - Revenue's contention: The sale deed did not mention prior payment, and possession/registration was on 07.07.2006, making it a short-term capital asset.

Which sections of the Income-tax Act were involved?

Section 153(3),Section 250,Section 254,Section 54,Section 54F,Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, HYDERABAD

Before: SHRI VIJAY PAL RAO

Pronounced: 30.09.2026

This appeal by the assessee is directed against the Order dated 13.01.2026 of the learned CIT(A), Hyderabad-11, Hyderabad for the assessment year 2009-2010. 2. The assessee has raised the following grounds of appeal:

1.

“The order of the CIT(A) passed u/s 250 of the Act dated 13.01.2026 Is erroneous both on facts and in law to the extent the order is prejudice to the interests of the appellant.

2.

The Ld. CIT(A) ought to have considered that the AO has erred in not considering the direction

The order continues below.

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