JHANSI LAKSHMI RAMANADHAM,HYDERABAD vs. ITO., WARD-8(1), HYDERABAD

Per contra, the Learned Departmental Representative (“Ld. DR”) submitted that the assessee herself admitted in her affidavit that she became aware of the recovery of Rs.1 crore on 26.12.2024, but the appeal was filed only on 19.05.2025, nearly five months thereafter. For this period also, no sufficient explanation has been furnished. Relying on the decisions of the Hon’ble Supreme Court in the case of Balwant Singh v. Jagdish Singh & Others (Civil Appeal No. 1166 of 2006) and Pathapati Subba Reddy (died) by L/Rs & Ors. vs. The Special Deputy Collector (LA), S.L.P. (Civil) No. 31248 of 2018, the Ld. DR submitted that delay cannot be condoned in the absence of sufficient cause and that the assessee has failed to demonstrate any reasonable cause. Accordingly, the delay should not be condoned and the appeal deserves dismissal on limitation.

We have carefully considered the rival submissions and the material available on record including the case law relied upon. In this regard, we have gone through the affidavit filed by the assessee which is to the following effect:

On perusal of the above, it is evident that the assessee is an 81-year-old lady, not conversant with online procedures and Page 5 of 12 dependent on others for handling tax matters. Her children reside abroad, and she frequently travels overseas. The assessee was unaware of the dismissal of her appeal until April 2025, and the chronology demonstrates that the delay was not deliberate but arose due to circumstances genuinely beyond her control, compounded by her age, limited mobility, and reliance on her consultant. Further, on examination of the registered sale deed (page no. 36 to 45 of the paper book) reveals that the property was jointly sold by the assessee and her two children. Nevertheless, the Ld. AO assessed the entire sale consideration of Rs.7 crores in the hands of the assessee alone, which prima facie reflects an apparent injustice that necessitates examination on merits rather than dismissal on technical grounds.

The decisions of the Hon’ble Supreme Court in the case of Balwant Singh v. Jagdish Singh & Others (Supra) and Pathapati Subba Reddy (died) by L/Rs & Ors. vs. The Special Deputy Collector (LA) (Supra) are distinguishable on facts. In those cases, the delay was attributable to negligence and lack of bona fide explanation, and the parties had failed to show sufficient cause. Accordingly, the Hon’ble Supreme Court declined to condone the delay. In contrast, in the present case, the assessee has clearly demonstrated sufficient cause, supported by detailed facts i.e. her age of 81 years, her dependence on the consultant, unfamiliarity with online proceedings, frequent travel abroad, and immediate steps taken upon gaining knowledge of the dismissal. These circumstances show that the delay was neither intentional nor negligent. Further, the Hon’ble Supreme Court in the case of Vidya Shankar Jaiswal vs. The Income Tax Officer, Ward-2, Ambikapur in Special Leave Petition (Civil) Nos. 26310-

The assessee has raised the following grounds of appeal:

The brief facts of the case are that the assessee is an individual who filed her return of income for the Assessment Year 2015–16 on 30.08.2015, admitting a total income of Rs.3,75,800/- . During the previous year relevant to the assessment year, the assessee, along with her two children sold an immovable property for a total consideration of Rs.7 crores. The assessee declared in her return of income that she held only a one-third share in the said property and accordingly admitted her share of capital gain. In her computation, the assessee claimed selling expenses of Rs.14,54,022/-, indexed cost of acquisition of Rs.10,49,953/- and indexed cost of improvement amounting to Rs.3,04,99,447/-. She thus worked out her share of capital gain at Rs.1,47,98,631/-. Out of this, she claimed deduction of Rs.50 lakhs under section 54EC and Rs.98,17,200/- under section 54 of the Income Tax Act, 1961 (“the Act”). The case of the assessee was selected for scrutiny and notice under section 143(2) of the Act was issued on 21.09.2016. During the assessment proceedings, the Ld. AO noted that the assessee could not produce adequate documentary evidence in support of her claim of holding only one-third share in the said property. The Ld. AO further observed that no satisfactory evidence had been produced in respect of the selling expenses claimed at Rs.14,54,022/-, nor for the indexed cost of improvement claimed at Rs.3,04,99,447/-. The Ld. AO also recorded that against the deduction under section 54 of the Act amounting to Rs.98,17,200/-, the assessee could substantiate only an investment of Rs.63,20,000/-. In the absence of acceptable evidence, the Ld. AO proceeded to compute the entire sale consideration of Rs.7 crores in the hands of the assessee alone and assessed the capital gain at Rs.5,76,30,047/-.

Aggrieved with the order of the Ld. AO, the assessee filed an appeal before the Ld. CIT(A). However, as the assessee did not respond to the notices issued by the Ld. CIT(A), the appeal was dismissed ex parte by the Ld. CIT(A).

Aggrieved with the order of the Ld. CIT (A), the assessee thereafter filed the present appeal before this Tribunal. At the outset, the Ld. AR submitted that the core dispute in the present appeal pertains to the denial of various claims relating to capital gains, including the assessee’s claim of one-third share in the property as well as her claims towards selling expenditure, cost of improvement, and deductions under sections 54 of the Act. The Ld. AR explained that the assessee had entrusted the appellate proceedings to her earlier consultant, who failed to respond to the notices issued by the Ld. CIT(A). As a result, the appeal was dismissed without adequate representation. The consultant also did not properly explain the basis of the assessee’s claim that she held only a one-third share in the property, due to which the Ld. AO erroneously proceeded to tax the entire sale consideration of Rs.7 crores in the hands of the assessee. The Ld. AR further submitted that the assessee was unable to furnish certain documentary evidence at the time of assessment, including evidence relating to the selling expenditure, cost of improvement, and proof of investment for the purpose of claiming deduction under section 54 of the Act. The Ld. AR emphasized that the assessee is now in possession of all relevant documents and is willing to produce them before the Ld. AO. In support of the Page 9 of 12 assessee’s claim of joint ownership, the Ld. AR drew our attention to the copy of the sale deed placed at page nos. 36 to 45 of the paper book and submitted that the sale deed categorically states that the property was owned by three persons, including the assessee, and that the assessee had received only Rs.3,00,00,000/- out of the total sale consideration of Rs.7,00,00,000/-. Thus, the assessee’s one-third share is undisputed from the face of the registered document. The Ld. AR accordingly prayed that, in the interest of justice, the matter may be restored to the file of the Ld. AO so that the assessee may be given one more opportunity to produce all supporting evidences and the correct computation of capital gain may be carried out.

Per contra, the Ld. DR objected to the request for remand and submitted that sufficient opportunities had already been provided to the assessee at both assessment as well as appellate stages. The assessee failed to avail those opportunities, and therefore, according to the Ld. DR, there is no justification for restoring the matter to the file of the Ld. AO.

We have carefully considered the rival submissions and have perused the material placed on record. On going through the registered sale deed (page nos. 36 to 45 of the paper book), it is evident that the said sale deed has been executed by three persons, the total sale consideration is recorded as Rs.7 crores and it is clearly reflected that the assessee received only Rs.3 crores. This factual position emerges directly from the sale deed itself. Despite this documentary evidence, the Ld. AO has computed the entire sale consideration in the hands of the assessee, which, on the face of it, does not align with the details contained in the registered conveyance deed. We further observe

In the result, the appeal of the assessee is allowed for statistical purposes.