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Facts
The assessee, an individual, did not file a return for AY 2018-19. Based on information of immovable property sale, the AO initiated proceedings and made an addition of Rs. 76,24,350/-. The CIT(A) dismissed the assessee's appeal in limine for not paying advance tax.
Held
The Tribunal held that the CIT(A) erred in dismissing the appeal in limine as there was no liability for advance tax. The case was remitted to the AO for denovo adjudication.
Key Issues
Whether the CIT(A) was justified in dismissing the appeal in limine for non-payment of advance tax when no such liability existed. Whether the matter should be remitted back for fresh adjudication considering various details.
Sections Cited
249(4), 148, 143(2), 142(1), 144, 147
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Income Tax Appellate Tribunal, PUNE “B” BENCH : PUNE
Before: DR. MANISH BORAD & SHRI VINAY BHAMORE
IN THE INCOME TAX APPELLATE TRIBUNAL PUNE “B” BENCH : PUNE BEFORE DR. MANISH BORAD, ACCOUNTANT MEMBER AND SHRI VINAY BHAMORE, JUDICIAL MEMBER I.T.A.No.284/PUN/2025 (Assessment Year 2018-19) Ravindra Balasaheb ITO, Ward-6(1), Pune Raykar, S.No. 105, Raykarmala, Dhayari Tal vs. Haveli, Pune-411 041. PAN : AQOPR 8426 P (Appellant) (Respondent) For Assessee : Shri Yash Agrawal, CA For Revenue : Shri Manish Mehta, Addl. CIT Date of Hearing : 15.05.2025 Date of Pronouncement : 21.05.2025 ORDER PER DR. MANISH BORAD, AM:
This appeal by the assessee is directed against the order dated 06.11.2024 of the Ld. Commissioner of Income Tax (Appeals)/NFAC, Delhi [“CIT(A)”] for the A.Y. 2018-19
The assessee has raised the following grounds of appeal:-
“1. The Ld. CIT(A) erred in invoking the provisions of section 249(4) and dismissing the appeal petition of appellant without providing an opportunity of being heard.
2. In facts and circumstances of the case and in law, the Ld. CIT (A) erred in interpretation of facts that the return of income filed in reply to the notice dated 01.04.2022 was on 25.04.2023 instead of actual date that is 25.04.2022 and is within 30 days from the notice date. Accordingly, the order passed is illegal and bad in law.
3. Without prejudice to the above in the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in adjudging the fact that the appellant has entered into a mere development agreement and has not transferred the Title of the Land' and thereby erred in upholding the view of the Assessing officer which is bad-in-law.
2 ITA.No.284/PUN./2025 (Ravindra Balasaheb Raykar) 4. It is humbly prayed that the reliefs as prayed for hereinabove and/or such other reliefs as may be justified by the facts and circumstances of the case and as may meet the ends of justice should be granted. 5. The appellant craves leave to amend or alter any ground or add a new ground, which may be necessary.”
Brief facts of the case are that assessee is an individual and did not file his return of income for the A.Y. 2018-19. Based on the information received that the assessee had sold immovable property worth Rs. 84,71,500/-, the Ld.AO initiated the assessment proceedings by validly issuing notice u/sec. 148 of the Act. In compliance, the assessee furnished return on 25/04/2022 declaring total income of Rs. 2,12,210/-. The Ld.AO thereafter issued notice u/sec.143(2) of the Act for carrying out the assessment proceedings. However, the assessee failed to make any compliance to the notice issued u/sec. 142(1) of the Act on three occasions and no details were filed. Even final show-cause notice issued on 29/11/2023 was also not complied by the assessee. The Ld.AO concluded the assessment proceedings making addition of Rs. 76,24,350/- towards capital gain from sale of immovable property.
Aggrieved, the assessee preferred appeal before the Ld. CIT(A) against the impugned addition, who dismissed the appeal in limine by applying the provisions of sec. 249(4)(b) of the Act alleging that the assessee had not paid amount equal to the amount of advance tax which was payable by him. Now the assessee is in appeal before this Tribunal.
3 ITA.No.284/PUN./2025 (Ravindra Balasaheb Raykar) 5. Learned counsel for the assessee has submitted that the income of the assessee is below taxable limit, and even preceding years also the income is below the taxable limit and there is no liability on the assessee to pay advance tax. He also submitted that the Ld. CIT(A) erred in observing that sec.249(4)(b) is applicable, but the same is applicable when no return has been filed, but the assessee has furnished the return, and therefore, sec. 249(4)(a) shall apply and tax has been duly paid on the income declared in the return of income. He further submitted that before the Ld.AO assessee could not file necessary details regarding the development agreement with M/s. Swastik Enterprises, M/s. R.K. Developers & M/s. Shivdarshan Enterprises which are placed in the paper book running into 114 pages filed on 15/05/2025. He further prayed that the matter may be restored to the file of the Ld. jurisdictional AO (JAO) for denovo adjudication.
On the other hand, Ld.DR though supported the order/s of the lower authorities, but did not object to the prayer of the assessee for remitting the issues to the file of Ld.JAO.
We have heard the rival contentions and perused the material placed before us. We observe that on the basis of the information about the alleged transaction of sale of immovable property, the assessee has been fastened with an addition of Rs. 76,24,350/-. But in the appeal before the Ld. CIT(A), we notice that the Ld.CIT(A) dismissed the appeal in limine alleging that the assessee had not complied with sec. 249(4)(b) of the Act and has not paid advance tax payable by him. The Ld. CIT(A) has observed that in the order passed u/sec. 147 r.w.s. 144, the Ld.AO has assessed the income 4 ITA.No.284/PUN./2025 (Ravindra Balasaheb Raykar) at Rs. 78,36,560/- which includes the addition on account of variation as per para 4 of Rs. 76,23,350/-. The Ld.AO has created a demand of Rs. 53,04,601/- which includes tax and interest. The Ld. CIT(A) has further noticed that the demand created by the Ld.AO has not been deposited by the assessee before filing of the appeal. We fail to find any merit in such observation of the Ld. CIT(A) in the impugned order because in the case of the assessee there was no liability of advance tax payable as per the preceding years because the assessee had not earned any taxable income and even for the year under consideration, the assessee had filed the return and whatever tax payable, has been deposited. The additions made by the Ld.AO which is under challenge and the income assessed by the Ld.AO cannot be treated as income of the assessee for the purpose of calculating the advance tax liability. Therefore, we are of the considered view that Ld. CIT(A) erred in dismissing the appeal of the assessee in limine applying sec. 249(4)(b) of the Act.
Ideally, the issues raised in the instant appeal deserves to be remitted back to the file of the Ld. CIT(A) for necessary adjudication. However, since the assessment order is also best judgment assessment and various details possessed with the assessee were not placed before the lower authorities and remained to be examined for the purpose of assessing the correct income of the assessee. We, therefore, considering the prayer made by the learned counsel for the assessee and no objection raised by the Ld.DR, remit all the issues raised in the instant appeal to the file of the Ld.JAO and direct the assessee to place all the evidences as 5 ITA.No.284/PUN./2025 (Ravindra Balasaheb Raykar) placed before this Tribunal to be placed again before the Ld.JAO including the paper book running into 114 pages which shall be considered by the Ld.JAO for carrying out denovo assessment proceedings in accordance with law. Needless to mention that Ld.JAO shall grant fair hearing of opportunity to the assessee before framing assessment and the assessee shall also not take unnecessary adjournments unless required for reasonable cause. Thus, the grounds of appeal
raised by the assessee are allowed for statistical purposes.
9. In the result, appeal of the assessee is allowed for statistical purposes. Order pronounced in the open Court on 21.05.2025.