NAND KISHORE AGARWAL,HYDERABAD vs. INCOME TAX OFFICER,WARD-7(3), HYDERABAD., HYDERABAD

ITA 2101/HYD/2025Status: DisposedITAT Hyderabad16 October 2026AY 2015-168 pages
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What did the Tribunal hold?

The Tribunal held that the assessee's appeal was confined to the claim of deduction under section 54F of the Act, as the quantum of capital gains and the year of taxability were accepted. The Tribunal noted that four residential properties were allotted to the assessee jointly with Mr. Vishnu Swaroop and Mr. Ashish Kumar. Crucially, the Tribunal observed that the Ld. CIT(A) had allowed deduction under section 54F in the case of Ashish Kumar concerning his interest in the residential properties received under the same JDA. The Tribunal found no material distinction concerning the assessee's entitlement to the deduction that was brought to its notice by the Revenue. Since deduction was allowed to Ashish Kumar on identical material facts, and the assessee's claim was denied without any material distinction being demonstrated, the Tribunal found merit in the assessee's contention. Accordingly, the Tribunal directed the AO to allow deduction under section 54F to the assessee in respect of his proportionate interest in the residential properties received under the JDA and to compute the deduction as per the statutory formula. The appeal was allowed for statistical purposes.

What were the facts?

The assessee, Shri Nand Kishore Agarwal, is appealing an order from the Learned Commissioner of Income Tax (Appeals), NFAC, Delhi, dated 12.09.2025, for Assessment Year 2015-16. The assessee, along with seven co-owners, entered into a Joint Development Agreement (JDA) with a developer for a property. The Assessing Officer (AO) initiated reassessment proceedings under Section 147 of the Income-tax Act, 1961, after observing that the assessee had not offered any income under the head 'Capital gains' arising from the JDA. The AO computed capital gains at Rs. 79,26,560/- and added it to the returned income, completing the assessment under Section 143(3) read with Section 147. The Ld. CIT(A) dismissed the assessee's appeal.

What were the issues?

1. Whether the First Appellate Authority was correct in confirming the action of the AO initiating proceedings under section 147 of the Income-tax Act, 1961. 2. Whether the First Appellate Authority was justified in confirming the addition of Rs.79,26,560/- as capital gain without allowing deduction towards cost and deduction under section 54F. 3. Whether the First Appellate Authority was justified in rejecting the assessee's contention that there was no transfer of property for the AY under consideration. 4. Whether the First Appellate Authority was justified in not allowing the deduction under section 54F of the Act in respect of residential properties received by the assessee under the JDA. Assessee's Contentions: - The assessee is not disputing the quantum of capital gains or the year of taxability. - The sole issue is the denial of deduction under section 54F. - Deduction under section 54F was allowed to a co-owner, Ashish Kumar, in respect of properties from the same JDA, making the denial to the assessee inconsistent. - The assessee prayed for the AO to be directed to allow deduction under section 54F. Revenue's Contentions: - The Learned Departmental Representative relied upon the orders of the lower authorities.

Which sections of the Income-tax Act were involved?

Section 147,Section 148,Section 143(3),Section 54F

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, Hyderabad ‘ A ‘ Bench, Hyderabad

Before: Shri Vijay Pal Rao, Vice-Shri Madhusudan Sawdia

Hearing: 22/09/2026

Per Madhusudhan Sawdia, A.M.: This appeal is filed by Shri Nand Kishore Agarwal (“the assessee”), feeling aggrieved by the order passed by the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC) Delhi (“Ld. CIT(A)”) dated12.09.2025 for the A.Y. 2015-16. ITA No 2101 of 2025 Nand Kishore Agarwal

2.

The assessee has raised the following grounds of appeal:

“1. The order of the First Appellate Authority is not correct either on facts oor in law and in both.

2.

T

The order continues below.

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