BEER MATI,NEW DELHI vs. ITO, WARD- 43(2), NEW DELHI

This appeal by the assessee is preferred against the order of the Commissioner of Income Tax [Appeals] – 15, Delhi dated 27.06.2018 pertaining to assessment year 2015-16.

The assessee has raised as many as 10 grounds of appeal but the at the very outset, the solitary ground which was argued by the ld. counsel for the assessee before me relates to the claim of exemption u/s 54F of the Income tax Act, 1961 [hereinafter referred to as 'The Act' for short].

The ld. counsel for the assessee vehemently argued that the Assessing Officer, after examining the computation of capital gains, never questioned the claim of exemption u/s 54F of the Act nor any show cause notice was issued for denial of the same.

The ld. CIT(A) confirmed the denial of exemption.

I have carefully perused the assessment order and the order of the first appellate authority. It is true that at Para 5.2, the Assessing Officer has considered long term capital gains of Rs. 13,18,040/- and referred to the claim of exemption u/s 54F of the Act. But I do not find any show cause notice nor any query by which the Assessing Officer asked the assessee why the exemption should not be denied.

The order of the first appellate authority is also devoid of any such query. Therefore, in the interest of justice and fair play, I deem it fit to restore this issue to the file of the Assessing Officer with a direction to examine the claim of exemption u/s 54F of the Act and the assessee is directed to furnish necessary documents in support of the claim. Needless to mention, the Assessing Officer shall afford reasonable opportunity of being heard to the assessee.

In the result, the appeal filed by the assessee in is allowed for statistical purposes.