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Facts
The assessee sold a property for Rs. 15,00,000/- and claimed exemption under Section 54F for investing in a new house. The AO reopened the assessment, alleging the sale price was Rs. 3,00,000/- and initiating penalty proceedings. The CIT(A) dismissed the assessee's appeal due to lack of supporting documents.
Held
The Tribunal set aside the orders of the revenue authorities. It directed the Assessing Officer to re-examine the issues and pass a fresh order after giving the assessee an opportunity to be heard and to provide necessary documents.
Key Issues
Whether the Assessing Officer correctly reopened the assessment without considering the return filed by the assessee and the supporting documents provided before the Tribunal. Whether proper opportunity was given to the assessee to substantiate his claim.
Sections Cited
143(1), 147, 148, 271(1)(c), 54F, 139(1), 144
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Income Tax Appellate Tribunal, ‘SMC’ BENCH, KOLKATA
Before: Shri Duvvuru RL Reddy, Vice-(KZ)
Appearances by: Shri Sujit Basu, Advocate and Shri Rajib Mukherjee, Advocate, appeared on behalf of the assessee Shri Kallol Mistry, JCIT, Sr. D.R., appeared on behalf of the Revenue Date of concluding the hearing: December 09, 2025 Date of pronouncing the order: December 09, 2025 O R D E R
The present appeal is directed at the instance of assessee against the order of Id. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi, dated 19.08.2025 passed for Assessment Year 2014-2015.
(A.Y. 2014-2015) Gopal Kundu Roy 2. Facts in brief are that the assessee is an individual. During the year under appeal, the assessee had sold his landed property for Rs.15,00,000/- on 03.09.2013 and the stamp duty value of the same was for Rs.15,09,374/-. The assessee had invested the sale proceeds of Rs.15,00,000/- in construction of his new house property. Due claim for exemption for investment in building for Rs.15,00,000/- had been made in the return. The return was processed under section 143(1) of the Act by the ld. Assessing Officer on 17.08.2015 and the ld. Assessing Officer had sent intimation of the assessee through Post on India Government Service. The ld. Assessing Officer observed that the assessee had sold his landed property for Rs.3,00,000/- and not for Rs.15,00,000/-, the stamp duty value of which was for Rs.15,09,374/- and observed that the assessee did not file his return of income and reopened the assessment under section 147 read with explanation 2(a) thereto being deemed case of escaped assessment, where no return of income has been furnished by the assessee although his total income during the previous year exceeded the maximum amount, which is not chargeable to income tax. Notice under section 148 was issued to the assessee dated 26.03.2021 and in response to notice under section 148, the assessee filed income tax return on 08.04.2021 admitting the income of Rs.3,12,447/-. Finally, ld. Assessing Officer determined the assessed income of assessee at Rs.16,31,348/- [returned income u/s. 148 Rs.3,12,447/- plus Rs.13,18,901/- (stamp duty Rs.15,09,374/- minus Rs.1,90,473/- as cost of acquisition)] and initiated penalty proceedings under section 271(1)(c) of the Act in respect of concealed the particulars of income.
(A.Y. 2014-2015) Gopal Kundu Roy 3. On being aggrieved, the assessee preferred an appeal before the ld. CIT(Appeals). The ld. CIT(Appeals) dismissed the appeal of the assessee as no supporting documents such as proof of construction expenditure, bills or completion certificate were furnished by him despite opportunities to substantiate his case.
On being aggrieved, the assessee preferred an appeal before the Tribunal. At the outset, it was the submission of the ld. Counsel for the assessee that the assessee has already filed the return of income for the assessment year 2014-15 showing the long-term capital gains and also claimed exemption under section 54F of the Act, but the ld. Assessing Officer has not considered the return filed by the assessee under section 139(1) of the Act and passed the order under section 147/144 of the Act and also made an addition of Rs.15,00,000/-, which was shown as sale consideration. The assessee also filed the sale deed before me and also filed a paper book. In that paper book, the assessee filed the sale deed and also return of income under section 139(1) of the Act. The return of income clearly shows that the assessee has made the sale transaction and also claimed exemption under section 54F, but ld. CIT(Appeals) has not considered the same and dismissed the appeal. He, therefore, prayed to set aside the order of ld. CIT(Appeals).
It was the submission of the ld. Departmental Representative that during the appellate proceedings, so many opportunities were provided to the assessee to substantiate his claim, but no response was given from the side of assessee. The assessee has not (A.Y. 2014-2015) Gopal Kundu Roy furnished the proof of construction expenditure under section 54F, bills or completion certificate etc. in support of his claim. Therefore, getting no other alternatives, ld. CIT(Appeals) dismissed the appeal of the assessee. He, therefore, prayed to confirm the order of ld. CIT(Appeals).
I have heard both the sides and perused the material available on record. By considering the totality of the facts and circumstances of the case and in the interest of justice and fair play, I am of the view that it is a fit case to set aside the orders passed by the revenue authorities since the assessee has filed relevant documents before the Tribunal. Therefore, I set aside the order passed by the ld. CIT(Appeals) and remit the matter back to the file of ld. Assessing Officer to examine the issues afresh and pass the order on merits after providing one more opportunity of being heard to the assessee. At the same breath, I also hereby caution the assessee to promptly co-operate with the proceedings before the Ld. Assessing Officer failing which the Ld. Assessing Officer shall be at liberty to pass appropriate order in accordance with law and merits of the case, based on the materials available on the record. Thus, the grounds raised
by the assessee in the appeal are allowed for statistical purposes.