SHAILESH BALDEVBHAI PATEL,AHMEDABAD vs. THE INCOME TAX OFFICER, WARD-2(2)(5) NEW WARD- 2(1)(2), AHMEDABAD
Income Tax Appellate Tribunal, “SMC” BENCH, AHMEDABAD
Before: DR. B.R.R. KUMAR, VICE-SHRI SIDDHARTHA NAUTIYAL(Assessment Year: 2010-11
PER DR. B.R.R. KUMAR, VICE-PRESIDENT:-
This appeal is filed by the Assessee against the appellate order dated 09.10.2023 passed by the Commissioner of Income Tax
(Appeals), Ahmedabad relevant to the Assessment Year 2010-11. 2. The assessee has raised the following grounds of appeal:
The learned Commissioner of Income Tax (Appeals)-11 Ahmedabad erred both in law and on facts in confirming the penalty u/s 271(1) of the IT Act, 1961 in respect of addition of Rs. 76,47,820/ on account of Long term Asst. Year : 2010-11 - 2–
The Id CIT(A) also erred both in law and on facts in not affording reasonable opportunity of being heard when the representative | Brother of Appellant] approached him with request to grant time due to illness of the Authorised Representative of appellant before passing the order. The order partly confirming penalty without adhering to principles of natural justice and audi alterem partem is illegal and deserves to be set aside to the extent, the penalty confirmed by him.
The Id CIT(A) also further erred both in law and on facts in not properly considering the earlier submissions and the relevant case laws cited before him while passing the order without affording time as requested in person on behalf of appellant. It be so held now.
On the facts and in the circumstances of the case, since the order of Hon'ble ITAT to the extent of confirmation of addition and its finding being in further challenge before the Hon'ble Gujarat High Court, the order passed by Id CIT(A) to the extent the penalty is confirmed on such addition is unjustified and deserves to be set aside. As above facts could not be brought to his notice due to non granting of time. It be so held now.
The order passed by Id CIT(A) is patently wrong and untenable in view of the legal position holding the penalty order passed by ld AO to be illegal and invalid on account of lack of firm conclusion regarding nature of default. It be so held now and Order passed by Id CIT(A) to the extent, the penalty is confirmed by him in part be cancelled.
The Id CIT(A) ought to have allowed the appeal in toto.
At the outset, we noticed that quantum appeal bearing IT(SS)A No.151/Ahd/2017 for A.Y 2010-11 dated 26.05.2025 has been restored to file of Assessing Officer for assessment denovo. The relevant extract of the order is reproduced as below:
“…3. We have carefully considered the submissions and perused the materials available on record. Perusal of the Ld.CIT(A)’s order makes it clear by way of Additional Ground No.
1(a), the assessee claimed that “Ld.AO erred in not granting exemption u/s.54B in respect of sale of land at Survey No.197/1
and 198/1 when the amount in respect of the said land which Shailesh B Patel Vs. ITO
Asst. Year : 2010-11
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was received before the Sale Deed and as per the MOU was towards sale of agricultural land at the time of receipt. Hence to that extent of such proceeds, the capital gain ought to have been considered as gain on sale of agricultural land". However perusal of the appellate order makes it clear that Ld. CIT(A) has not adjudicated this additional ground raised by the assessee. In fact, if this correct fact of non-consideration of additional ground by CIT(A) ought to have been brought before Hon'ble High Court of Gujarat, the Hon'ble High Court would have set aside the matter back to the file of Ld. CIT(A). As this matter is set-aside back to the file of this Tribunal, we are satisfied that this Additional Ground was not adjudicated either by the Ld. CIT(A) or by the Ld. A.O. Therefore in the interest of Principle of Natural
Justice, we deem it fit to set-aside the matter back to the file of Juri ictional Assessing Officer to decide the issue on merits by giving proper opportunity of hearing to the assessee and pass order in accordance with law…”
4. Since the quantum appeal stands set-aside to the Assessing Officer for framing assessment de-novo, the penalty levied u/s.271(1)(c) of the Act is hereby deleted with a direction to consider initiation of penalty proceeding at the time of passing of Assessment order.
5. In the result, the appeal of the assessee is allowed for statistical purposes.
The order is pronounced in the open Court on 30.07.2025 (SIDDHARTHA NAUTIYAL)
VICE-PRESIDENT
()
Ahmedabad; Dated 30.07.2025
Asst. Year : 2010-11
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आदेश की Ůितिलिप अŤेिषत/Copy of the Order forwarded to :
अपीलाथŎ / The Appellant 2. ŮȑथŎ / The Respondent. 3. संबंिधतआयकरआयुƅ / Concerned CIT 4. आयकर आयुƅ(अपील) / The CIT(A)- 5. िवभागीय Ůितिनिध, आयकर अपीलीय अिधकरण, अहमदाबाद / DR, ITAT, Ahmedabad 6. गाडŊ फाईल / Guard file.
आदेशानुसार/ BY ORDER,सहायक पंजीकार (Dy./Asstt.