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Facts
The assessee sold an immovable property for Rs. 54,50,000 during AY 2016-17 but did not file a return of income, claiming a bona fide belief that his wife would discharge the tax liability. The Assessing Officer (AO) completed the assessment on a total assessed income of Rs. 54,50,000/- u/s. 147 r.w.s. 144 r.w.s. 144B of the IT Act.
Held
The Tribunal held that the assessee could not produce the required details before the lower authorities. Therefore, in the interest of justice and fair play, the issue was remitted to the file of the AO for fresh consideration. A token cost of Rs. 2,000/- was imposed on the assessee due to continued negligence.
Key Issues
Whether the appeal should be allowed to be remitted to the AO for fresh consideration due to non-compliance by the assessee and whether a cost should be imposed.
Sections Cited
250, 148, 148A, 139, 142(1), 147, 144, 144B
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, ‘A’ BENCH : BANGALORE
Before: SHRI WASEEM AHMED & SHRI KESHAV DUBEY
PER KESHAV DUBEY, JUDICIAL MEMBER
1. This appeal at the instance of the assessee is directed against the order of Ld.CIT(A)/NFAC dated 06/02/2025 vide DIN & Order No. ITBA/NFAC/S/250/2024-25/1072987009(1) passed u/s. 250 of the Income Tax Act,1961 (in short “the Act”) for the Assessment Year (in short “A.Y.”) 2016-17.
Page 2 of 7 ITA No. 301/Bang/2025
The assessee has raised the following grounds of appeal:
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The brief facts that in the case of the assessee, specific information was flagged as per risk management strategy formulated by the CBDT through ITBA software under the head ‘NMS cases’. The gist of the specific information in the case of the assessee pertaining to the transactions which were carried out during the relevant year was as follows: “1. Property sale for a consideration of Rs. 54,50,000/-”
3.1 It was seen that the assessee has sold immovable property during the relevant year for a consideration of Rs. 54,50,000/-. However, the assessee has not filed any ITR for the year under consideration either u/s. 139 of the Act or in response to notice u/s. 148 of the Act. However, the assessee has filed computation of income during the course of assessment proceeding. On the basis of computation of income, the assessee was asked to provide various details such as copy of the purchase deed, details of cost of improvements along with bills & vouchers, bank statement and mode of payment, details of selling expenses, details of housing loan interest of Rs. 2 Lakhs claimed under income from house property, details of deduction claimed under Chapter VIA along with the documentary evidences. However, the assessee had not furnished any reply with regard to above in spite of ample opportunities as provided by the AO. Accordingly, the AO
Page 5 of 7 completed the assessment on a total assessed income of Rs. 54,50,000/- u/s. 147 r.w.s. 144 r.w.s. 144B of the IT Act on 07/03/2024.
Aggrieved by the order of AO passed u/s. 147 r.w.s 144 of the Act dated 07/03/2024, the assessee preferred an appeal before the Ld.CIT(A)/NFAC.
The Ld.CIT(A)/NFAC also dismissed the appeal of the assessee on the ground that there were no reasonable, cogent and valid arguments / contentions advanced by the assessee in the instant appeal to counter the AO decision as contained in the assessment order and accordingly, the additions / disallowances made by the AO was sustained.
Aggrieved by the order of the Ld.CIT(A)/NFAC, the assessee has filed the present appeal before this Tribunal.
Before us, the Ld.AR of the assessee vehemently submitted that the assessee could not file his return of income for the reasons beyond his control. Further, the notices issued u/s. 142(1) of the Act through email ID belong to the tax consultants / auditors. Lastly, the Ld.AR of the assessee submitted that both the authorities below have passed the order without providing sufficient opportunity of being heard and prayed to remit the entire issue in dispute to the file of AO for fresh consideration and also undertakes to submit all the documents before the AO if remitted back.
The Ld. DR on the other hand, supported the order of the authorities below and submitted that the assessee is completely slipshod not only before the AO but also in pursuing his appeal before the Ld.CIT(A)/NFAC and accordingly prayed that the appeal may be dismissed in limine.
We have heard the rival submissions and perused the materials available on record.
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It is an undisputed fact that assessee has sold immovable property during the relevant year for a consideration of Rs. 54,50,000/-. It is also an undisputed fact that assessee had neither filed his return of income u/s. 139 of the Act nor in response to notice u/s. 148 of the Act. We take note of the fact that assessee had filed computation of income during the course of assessment proceeding based on which the AO asked to furnish the certain details / bills / vouchers / bank statement, copy of deeds in order to substantiate the claim of the assessee. However, the assessee could not produce the same before the lower authorities and prayed to remit the issue to the file of AO for fresh consideration. This being so, in the interest of justice and fair play and as requested by the Ld.AR of the assessee, the issue in dispute are remitted to the file of AO to decide afresh in accordance with the law. While remitting the matter to the file of AO, we also consider it necessary to impose a token cost of Rs. 2,000/- to the assessee in aggregate owing to continued negligence shown to the statutory notices at both the levels. The assessee shall deposit the cost warranted in favour of Prime Minister Relief Fund and the receipt thereof shall be furnished before the AO. With these terms, the appeal of the assessee is restored to the file of AO for denovo adjudication in accordance with law. The assessee is also directed to produce the copies of purchase deed and sale deed, details of interiors/furniture & fittings done by the assessee along with bills, vouchers, bank statement, mode of payment and details of source thereof. Further, the assessee shall also furnish the details of selling expenses claimed amounting to Rs. 1,20,000/- including bill, vouchers, bank statements in order to substantiate his claim. The assessee is also directed to produce copy of housing loan interest statement / certificate from bank and documentary evidences with the proof of payment for the deduction claimed under Chapter VIA. We hereby clarify that in case of further default, the assessee shall not be entitled for any leniency. It is ordered accordingly.
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In the result, the appeal filed by the assessee is partly allowed for statistical purposes.
Order pronounced in the open court on 9th July, 2025.