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Facts
The assessee had not filed his return of income for AY 2011-12. Information was received about the sale of immovable property and cash deposits. The case was reopened, and a return was filed declaring total income. The Assessing Officer made additions for short-term capital gain and tower rent.
Held
The Tribunal held that the additional evidences submitted by the assessee go to the root of the matter regarding the land being agricultural. The Tribunal admitted these evidences and restored the issue to the Assessing Officer for re-adjudication.
Key Issues
Whether the land sold was agricultural or non-agricultural, and whether the addition made by the AO on account of short-term capital gain was justified. Also, issues regarding disallowance of expenses.
Sections Cited
148, 143(3), 147, 2(1A), 63
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, PUNE BENCH “A”, PUNE
Before: SHRI R. K. PANDA & Ms. ASTHA CHANDRA
Assessment year : 2011-12 Balasaheb Vitthal Shinde ITO, Ward-5(4), Pune Chaledi, Nasarapur, Taluka Bhor, Vs. Pune – 412213 PAN: ANIPS1140A (Appellant) (Respondent) Assessee by : Shri Deepak S Sasar Department by : Shri Vidya Ratan Kishore Date of hearing : 17-12-2025 Date of pronouncement : 29-12-2025 O R D E R PER R.K. PANDA, VP:
This appeal filed by the assessee is directed against the order dated 26.11.2024 of the Ld. CIT(A) / NFAC, Delhi relating to assessment year 2011-12.
Facts of the case, in brief, are that the assessee had not filed his return of income for the impugned assessment year. Information was available in possession of the department that the assessee has sold immovable property valued at Rs.75 lakhs and has made cash deposit of Rs.8 lakhs and has also received an amount of Rs.2,15,589/- on which TDS was deducted. Accordingly, the case of the assessee was reopened after recording reasons and notice u/s 148 of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) was issued and served on the assessee. The assessee in response to the same filed the return of income declaring total income of Rs.9,69,976/-. The Assessing Officer issued statutory notices u/s 143(2) and 142(1) of the Act in response to which the assessee filed certain details. The Assessing Officer completed the assessment u/s 143(3) r.w.s. 147 of the Act determining the total income of the assessee at Rs.60,02,223/- wherein he made addition of Rs.49,44,572/- on account of short term capital gain and tower rent of Rs.1,57,138/- as income from other sources.
Before the Ld. CIT(A) / NFAC the assessee filed certain additional evidences which the Ld. CIT(A) / NFAC has accepted and forwarded the same to the Assessing Officer for filing a remand report. The Assessing Officer filed the remand report which was forwarded to the assessee for his comments / objections, if any. However, the assessee did not submit any comments in respect to the same. Therefore, the Ld. CIT(A) / NFAC decided the issue on the basis of the submissions made by the assessee earlier and the remand report of the Assessing Officer and dismissed the appeal by observing as under:
Aggrieved with such order of the Ld. CIT(A) / NFAC the assessee is in appeal before the Tribunal by raising the following grounds:
1 – INVALID ASSUMPTION OF THE JURISDICTION BY THE LD. ASSESSING OFFICER 1) The Ld. Assessing Officer did not follow the procedure for reopening of the assessment by non-issuance of mandatory reasons for reopening of assessment and the letter of permission taken from higher authorities and The Hon Commissioner of Income Tax (Appeals) erred in dismissing this ground hence assessment is liable to cancel. II – THE EXEMPT ASSET BEING THE RURAL AGRICULTURAL LAND TREATED AS CAPITAL ASSET 2) In the facts and in Law the Ld. AO treated Rural Agricultural Land as capital asset and this was erroneously confirmed by the Hon. CIT Appeals. III – MISAPPLICATION OF FACTS ON THE RECORD BY THE LD. AO AND ITS SUBSEQUENT CONFIRMATION BY HON. CIT APPEALS 3) The Ld. AO misapplied the fact that the land at Gat No. 116 having area 58R (Gunthas) was Non-Agricultural Land though it was Agricultural Land till the date of sale. 4) The Ld. AO misapplied the fact that land at Gat No.116 having area 58R (Gunthas) and land at Gat No.116 having area 26R (Gunthas) were cultivated by Appellant and the basic agricultural operations were carried-out as per the definition given in Section 2(1A) of the Income Tax Act, 1961. 5) The Ld. AO misapplied the fact that the Land sold to M/s Rushinandan Developers represented by Partner Mr. Shashank Nanaware was a Non-agriculturist. 6) The Ld. AO misapplied the provisions of Section 63 of the Maharashtra Tenancy and Agricultural Lands Act, 1948. IV – OTHER 7) The order of The Hon. Commissioner of Income Tax (Appeals) is blotched-up in nature, self-contradictory, non-speaking and without giving any specific findings.
V – MISCELLANEOUS 8) The Appellant craves leave to add, delete, amend, alter, abandon, substitute, vary and/or withdraw all or any of the above grounds during the hearing of the appeal.
We have heard the rival arguments made by both the sides, perused the orders of the Assessing Officer and the Ld. CIT(A) / NFAC and the paper book filed on behalf of the assessee. The Ld. Counsel for the assessee at the time of hearing filed an application seeking permission of the Bench to file certain additional evidences, the details of which are as under:
1) Evidence showing the 58R Land was Agricultural Land on which M/s Rushinandan Developers represented by Partners Mr. Shashank Chandrakant Nanaware and Mr. Shripad Mahadev Kulkarni who are Agriculturists, had availed a Mortgage Loan of Rs.16,00,000/-. 2) Affidavit of the Labour Mr. Ankush Ramchandra Pawar, confirming the Receipt of the payment towards Labour Charges, who had worked on the Agricultural Land owned by the Appellant, situated at Gat No. 116, Village Khandala, Dist. Satara, during Financial Year 2010-11, bearing Affidavit No.2552742571268510124852 dated 04.11.2025, for himself and for his deceased Father Late Mr. Ramchandra Shankar Pawar, and for his Deceased Mother Late Mrs. Prabhavati Ramchandra Pawar, sworn before the Hon. Executive Magistrate, Khandala, Satara. 3) Affidavit of the Labour Mrs. Seema Ankush Pawar, confirming the Receipt of the payment towards Labour Charges, who had worked on the Agricultural Land owned by the Appellant, situated at Gat No. 116, Village Khandala, Dist. Satara, during Financial Year 2010-11, Affidavit bearing No.2552742571268510124852 dated 04.11.2025 sworn before the Hon. Executive Magistrate, Khandala, Satara. 4) Affidavit of the Labour Mr. Dattatray Ananda Madhare, confirming the Receipt of the payment towards Labour Charges, who had worked on the Agricultural Land owned by the Appellant, situated at Gat No.116, Village Khandala, Dist. Satara, during Financial Year 2010-11, bearing Affidavit No.2552742571268510124578 dated 04.11.2025 sworn before the Hon. Executive Magistrate, Khandala, Satara. 5) Affidavit of the Owner of the Tractor Mr. Sanjay Kisanrao Kondhalkar, confirming the Receipt of the Tractor Charges, for Ploughing and leveling, on the Agricultural Land owned by the Appellant, situated at Gat No.116, Village Khandala, Dist. Satara, during Financial Year 2010-11, who had supplied the service of the Tractor, bearing Registration No. MH 12 AH 3588, bearing Notarised Serial No.64/B/2025 dated 04.11.2025 sworn before the Ld. Notary Adv. Nanaware Megha Govind, having Registration No.37148. 6) Coloured Copies of the Satellite Google Images along with the Certificate of the Licensed Architect authorized under Architect Act, 1963 of the said Agricultural land as on 2007, 2012, 2014, 2016 & 2017, which indicates the land was cultivated for agriculture, and that the development activity started in the year 2016.
He submitted that these additional evidences go to the root of the matter that the land sold is an agricultural land on which the assessee was conducting agricultural activities. It is also his submission that in the light of the decision of Hon’ble Bombay High Court in the case of Smt. Prabhavati S. Shah vs. CIT reported in (1998) 66 CCH 0193 (Bom), these additional evidences should be admitted. Since the additional evidences filed by the assessee go to the root of the matter in dispute, therefore, in the light of the decision of Hon’ble Bombay High Court in the case of Smt. Prabhavati S. Shah vs. CIT (supra), we admit the additional evidences filed by the assessee and restore the issue to the file of the Assessing Officer with a direction to re-adjudicate the issue as per fact and law after giving due opportunity of being heard to the assessee. The assessee is also hereby directed to submit the requisite details before the Assessing Officer on the appointed date without seeking any adjournment under any pretext, failing which the Assessing Officer is at liberty to pass appropriate order as per law. We hold and direct accordingly. The grounds raised by the assessee are accordingly allowed for statistical purposes.
In the result, the appeal filed by the assessee is allowed for statistical purposes.
Order pronounced in the open Court on 29th December, 2025.