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Facts
The assessee filed an appeal against an order that dismissed their appeal due to delay. The original Assessing Officer (AO) made an addition of Rs. 8,00,000/- as long-term capital gain, treating the entire sale consideration as income because the assessee had not filed a return and provided no evidence of cost of acquisition.
Held
The Tribunal held that the lower appellate authority (Addl./JCIT(A)) passed conflicting orders by dismissing the appeal for delay while also giving directions for re-computation of capital gains. The Tribunal restored the matter to the AO for a fresh decision, providing the assessee with another opportunity to be heard.
Key Issues
Whether the appeal should be dismissed solely on grounds of delay without affording proper opportunity for explanation, and whether contradictory orders passed by the appellate authority are sustainable.
Sections Cited
147, 143(3), 144
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Income Tax Appellate Tribunal, JAIPUR BENCHES,’’SMC” JAIPUR
fu/kZkj.ko"kZ@AssessmentYear : 2009-10 Shri Manu Chaudhary cuke ITO Vs. 7-CHA-11, Jawahar Nagar Ward 6(1) Jaipur – 302 017 Jaipur LFkk;hys[kk la-@thvkbZvkjla-@PAN/GIR No.: ADIPC 0353 R vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksjls@Assesseeby : Shri Dheeraj Borad, CA jktLo dh vksjls@Revenue by: Shri Gautam Singh Choudhary, JCIT-DR lquokbZ dh rkjh[k@Date of Hearing : 21/08/2025 mn?kks"k.kk dh rkjh[k@Date of Pronouncement: : 28/08/2025 vkns'k@ORDER PER: NARINDER KUMAR, JUDICIAL MEMBER This appeal filed by the assessee is directed against the order of ld. Addl/ JCIT(A)-10, Mumbai dated 13-03-2025 for the assessment year 2009-10 wherein the assessee has raised the following grounds of appeal; ‘’1. That on the facts and in law the impugned order dated 13/03/2025 passed by ld. ADDL/ICIT (A) dismissing assessee's appeal for the reason of delay in filing the appeal and sustaining the addition of Rs. 8,00,000/-is most arbitrary, unjust, untenable and liable to be vacated.
2. That on the facts and in law Id. ADDL/JCIT (A) grossly erred in holding that since the appeal is dismissed due to delay in filing the same no effect to the direction written in Para 6.4 of the impugned order stating, "the appellant is directed to submit the documents of purchase of land for Rs.4,01,000/-before the SHRI MANU CHAUDHARY VS ITO, WARD 6(1), JAIPUR AO. The AO shall verify the correctness of the documents. If the same is found in order, the benefit of indexed cost of acquisition would be granted to the appellant and the AO shall re-work out the long term capital gain" will be given.
3. That the action of the Id. ADDL/JCTT (A) withdrawing the part relief given in Para 6.4 of the impugned order by mentioning in Para 6.5 of the same impugned order, "Since the appeal is dismissed due to delay in filing the same, no effect to the direction given in Para 6.4 would be given is most arbitrary, unjust, unsustainable in fact and in law and liable to be cancelled.
4. That on the facts and in law the ld. ADDL/JCIT (A) ought to have condoned the delay in filing the appeal and should have maintained the direction given by he himself to the AO in Para 6.4 of the same impugned order inter alia saying to allow the benefit of indexed cost of acquisition to the asseusee and re-work out the long term capital gain 5. That on the facts and in law the M. ADDL/ICIT (A) grossly erred in not condoning the delay in filing the appeal and consequently dismissing the assessee's appeal for the reason of delay in filing the same 6. That on the facts and in law the ld. ADDL/JICTT (A) failed to discharge the burden of proof which squarely lay upon him before not condoning the delay in fling the appeal and consequentially dismissing theassessee’s appeal 7. That on the facts and in law theld. ADDL/JICIT (A) failed to provide opportunity of being heard to the appellant assesse before not condoning the delay in filing the appeal.’’ 2.1 At the outset of hearing of the appeal, it was noticed that the ld.Addl./JCIT(A) dismissed the appeal of the assessee on the ground of delay in filing the appeal before him. It is also pertinent to note from the order of the ld. Addl./JCIT(A) wherein he has given direction to the assessee to submit the documents of purchase of land for Rs.4,01,000/- before AO who will verify the correctness of the documents and if the same is found in order, the benefit of indexed cost of acquisition would be SHRI MANU CHAUDHARY VS ITO, WARD 6(1), JAIPUR granted to the assessee. Thus, the AO shall re-work out the long termcapital gain. Simultaneously the ld.Addl./JCIT(A) directed the AO that no effect to the direction given in para 6.4 would be given as he dismissed the appeal of the assessee on the ground of delay in filing the appeal. The narration as made by the ld. CIT(A) in para 3 to para 7 of his order are reproduced as under:- ‘’ There was delay in filing appeal. The appellant was requested to explain the reasons for the same as under:- The assessment order was served on 24-10-2016 and the appeal was filed on 7-11-2019. There is no request for condonation of delay in filing the appeal. Please explain why the appeal should not be dismissed for delay in filing the appeal.
It is seen that the appellant did not submit any explanation. The appellant did not file any request for condonation alongwith appeal memo also. In view of the same, the appeal of the appellant is dismissed due to delay in filing the same. 4 GROUNDS OF APPEAL:-
Aggrieved by the aforesaid order passed on 07.10.2016, the appellant has raised the following Grounds of appeal as narrated in Form No. 35-
The Ld. A.O. has erred in addition of Rs. 8,00,000/- as capital gain without effect of purchase cost, on the ground of that assessee had not complied any notice issued by Ld. A.O. The action of the Ld A.O. is illegal, unjustified and against the facts of the case. Relief may please be granted by deleting the addition.
The Assessee craves its rights to add, amend or alter the ground on or before the hearing.
SHRI MANU CHAUDHARY VS ITO, WARD 6(1), JAIPUR 5. During the course of appellate proceedings the notice of hearings wereissued time to time and the appellant submitted his submission. The same has been considered.
Decision 6.1 The appellant sold a plot for Rs. 8 lacs. In the absence of details, the same was taxed as long term capital gain of Rs. 8 lacs. 6.2 The appellant submitted as under- 1. GROUND NO. 1-Addition of Rs. 8,00,000/- 1.1 The appellant is partner in a partnership Firm MM Exports working as exporter of ladies garments and a director in a company named Nakshatra Buildhome Developers Private Limited. 1.2 Assessee had filed the Income Tax Return for the AY 2009-2010 on 11.03.2010. 1.3 Total Income shown by the assessee in his Income tax return Rs. 534770.00 and self assessment tax paid of Rs. 80000/- (Copy enclosed) 1.4 That the assesse had sold the immovable property on 17th October 2008 Plot No. 72, Central Spine (Block E), Jeerota, Jagatpura, Jaipur having 120 Sq. Mtr. to Shri Neelesh Bansal & Shri Piyush Bansal. 1.5 That this plot was purchased by the assesse on 20.12.2001 thru Agreement to sale from Shri Raghuveer Singh Sio Shree Dharam Chand Resident of Sunder Nagar Patel Marg. Jaipur 1.6 That the assessee had paid Rs. 401000/- as cost of plot to seller and agreement was executed that day only. (Copy enclosed) 1.7 That the said scheme along with other land was acquired by the RIICO and 15% of developed land allotted to the assessee (Copy of the Aarakshan Patra dated 04-06-2003 by JDA Jaipur. Copy of allotment letter dated 14-11-2005 by JDA, Suchna Patra By JDA dated 24-09-2005 is being enclosed) 1.8 That on 13-03-2007, Jaipur Development Authority has issued Patta to Shri Manu Choudhary for the said Plot No. E-72, Central Spine Scheme, Jeerota, Jagatpura Jaipur including possession letter (Copy Enclosed)
SHRI MANU CHAUDHARY VS ITO, WARD 6(1), JAIPUR 1.9 Now it is our humble submission on behalf of the assessee that during the assessment proceedings, all the documents could not be derived as that time assessee's father was hospitalized due to Heart Attack and only father had the custody of the all documents. 1.10 That the assessee could not submit the acquisition chain of the sold plot, now all document for the assessment is being submitted which are relevant to justice. 111 That the cost of acquisition along with indexed cost of purchase of plot should be allowed as deduction before calculating the tax on whole sale consideration of Rs. 8.00 Lacs. Tax on net profit on sale of plot will be paid by the assessee along with interest. 6.3 The appellant agreed that the transaction was not disclosed in the return of income. The appellant has requested to allow cost of acquisition/indexed cost and work out taxable long term capital gain. 6.4 The appellant is directed to submit the documents of purchase of land for Rs.4,01,000/- before the AO. The AO shall verify the correctness of the documents. If the same is found in order, the benefit of indexed cost of acquisition would be granted to the appellant and the AO shall re-work out the long term capital gain.
6.5 Since the appeal is dismissed due to delay in filing the same, no effect to the direction given in para 6.4 would be given.
In view of the above, the appeal of the appellant is dismissed due to delay in filing appeal.’’ 2.2 In the course of hearing, the ld. AR of the assessee submitted that the ld. Addl.JCIT(A) should have provided an opportunity of hearing for explaining the reason for such delay instead of dismissing the appeal of the assessee on the ground of the delay in filing the appeal. Further the ld. AR of the assessee submitted that the ld.Addl.JCIT(A) passed a conflicting order which is vague and convey two contradictory decisions and such SHRI MANU CHAUDHARY VS ITO, WARD 6(1), JAIPUR order is liable to be set aside. The detailed written submission in regard to all the grounds of appeal raised above by the assessee is reproduced as under:- ‘’Brief facts of the case Before making submissions in regard to all the grounds of appeal the appellant craves leave to furnish herewith brief facts of the case. These brief facts form part of the paper book being filed simultaneously.
SUBMISSIONS IN REGARD TO ALL THE GROUNDS OF APPEAL
After submitting the facts of the case the appellant craves leave to make submissions in regard to each ground of appeal
. GROUND OF APPEAL NO. 01, 06 and 07. All these three grounds of appeal are against passing of most arbitrary, unjust and untenable order by way of dismissing assessee's appeal for the reason of delay in filing the appeal and sustaining total assessed income at Rs. 8,00,000. In support of these grounds of appeal it is respectfully submitted as under:
1. That before dismissing the appeal for non-filing of application for condonation of delay in filing the appeal, the Id. Addl./JCIT(A) failed to provide a specific opportunity to the appellant for explaining the reasons of delay in filing the appeal against the ex-parte assessment order.
2. That as per the concept of natural justice the Id. Addl./JCIT(A) should have specifically asked the assessee to explain the reasons of delay and in its absence the impugned order is liable to be cancelled
3. That to the best of assessee's knowledge and belief, no specific opportunity of explaining the reasons of delay in filing the appeal was provided to the assessee. GROUNDS OF APPEAL
NO. 02 to 05. This ground of appeal is against non-condonation of delay in filing the appeal and simultaneously sustaining the ex-parte assessment order passed by the AO on the income of Rs 8.00,000, though in Para 64 of the impugned order the Id. Addl./JCIT(A) had himself given direction to the appellant to produce the documents in support of cost of acquisition and benefit of indexed cost of SHRI MANU CHAUDHARY VS ITO, WARD 6(1), JAIPUR acquisition before the AO so that he (the AO) could workout correct amount of long term capital gain. In this regard it is respectfully submitted as under:-
1.
1. That from the perusal of Para 6.4 of the impugned order passed by the Id Addl/JCIT(A). the hon'ble Bench will kindly find that vide this Para 6.4 of the impugned order passed by Addl/JCIT(A) which read as, "The appellant is directed to submit the documents of purchase of land for Rs. 4,01,000 before the AO. The AO shall verify the correctness of the documents. If the same is found in order, the benefit of indexed cost of acquisition would be granted to the appellant and the AO shall re-work out the long term capital gain" the Id. Addl./JCIT(A) has set aside the assessment order and sent it back to the AO for re-work out the long term capital gain 2. That surprisingly and simultaneously vide next Para 6.5 and Para 6 of the same impugned order he has dismissed the appellant's appeal.
3. That the law does not permit to pass such a conflicting order which is vague and conveying two different decisions/meanings in the same appellate order and as a result such an order is liable to be cancelled.
4. That both the lower authorities failed to recognize the return of income filed by the assessee for the year under appeal le AY 2009-10 on 11/03/2010 under acknowledgment no. 110681681110310 declaring total income of Rs. 5,34,770.
5. That the appellant craves leave to refer to and rely upon the written submissions filed by the appellant before the Id. Addl/JCIT(A). GROUND OF APPEAL
NO. 8 This ground of appeal is of consequential in nature and may kindly be decided accordingly.’’ To support its submission, the ld.AR of the assessee has filed following paper book. S.N. Name of Paper Page 1. Written submissions 1-2 2. Statement of facts 3 3. Supporting documents for purchase of property on21-12- 4-6 2001 4. Copy of allotment letter dated 14-1-2005 by JDA and Suchna 7-10 Patta by JDA
5. Lease deed dated 13-03-2007 issued by JDA in the name of 11-14 SHRI MANU CHAUDHARY VS ITO, WARD 6(1), JAIPUR Manu Choudhary for newly allotted Plot No.E 72, Central Spine Scheme, Jagatpura, Jaipur including possession letter 6. Copy of written submission filed by the appellant before the 15-16 ld. Addl/JCIT(A) 7. Copy of ITR Acknoweldgment and Computation of total 17-19 income for A.Y. 2009-10 8. Vakalatnama 20 On the other hand, the ld. DR supported the order of the ld.CIT(A). 2.3 2.4 We have heard both the parties and perused the material available on record. In this case, it is noted that the AO passed an ex-parte order in the case of the assessee having provided ample opportunities, and thus made an addition in the hands of the assessee amounting to Rs.8.00 lacs by treating it as long term capital gain u/s 147 of the Act. The relevant para 3 of the AO order is reproduced as under:- ‘’3. As per information available with this office and as per information gathered from Sub-Registrar, Jaipur, it is noticed that during the year under assessment the assessee sold immovable property to Shri Neelesh Bansal and Shri Peeyush Kumar Bansale at sale consideration of Rs.8,00,000/-. As discussed in details supra the assessee has been provided with immense opportunities to explain as to why the long term capital may not be charged on Rs.8,00,000/- as the assessee had not filed any return of income nor filed any evidence of cost of acquisition. In such circumstances and the casual approach of the assessee towards the notices issued by the Departments, I have left with no option but to treat the entire sale consideration of Rs.8,00,000/- as income of the assessee as Long Term Capital Gain u/s 144 r.w.s. 147.’’ SHRI MANU CHAUDHARY VS ITO, WARD 6(1), JAIPUR Ld. CIT(A) dismissed the appeal of the assessee by passing conflicting orders as notice above. Hence, in view of the above facts and circumstances of the case, the Bench feels that the assessee was ex-parte before the lower authorities and he did not substantiate his case. It was the bounded duty of the assessee to appear before the statutory authorities as and when called for. It is noticed that various opportunities were provided to the assessee for settling the issue, but the assessee remained lethargic and unserious in pursuing his case but at the same time we are of the considered view that lis between the parties needs to be decided on merits so that nobody’s rights are scuttled down. Hence, the matter is restored to the file of the AO to decide it afresh by providing one more opportunity of being heard. However, the assessee will not seek any adjournment on frivolous ground and remain cooperative during the course of proceedings. Thus, the appeal of the assessee is disposed of, for statistical purposes.
2.5 Before parting, we may make it clear that our decision to restore the matter back to the file of the AO shall in no way be construed as having any reflection or expression of opinion on the merits of the case, which shall be adjudicated by AO independently in accordance with law.