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Facts
The assessee, an individual, derived income from house property but failed to file a return of income by the due date. Upon receiving a notice, the assessee filed a delayed return. The AO treated the return as non est and made assessments, including adding cash deposits as unexplained money and capital gains on property sale.
Held
The Tribunal held that no evidence was filed before the CIT(A) to support the claim for costs of acquisition like registration charges. Similarly, no proof was provided for the availability of an opening balance of Rs. 3,50,000/-, and the CIT(A) had rightly restricted the addition on account of unexplained cash deposit to this amount.
Key Issues
Whether the assessee is entitled to include stamp duty and registration charges as cost of acquisition for the property sold, and whether the addition of Rs. 3,50,000/- on account of unexplained cash deposits was justified.
Sections Cited
139(1), 142(1)
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Income Tax Appellate Tribunal, COCHIN BENCH
Before: SHRI INTURI RAMA RAO, AM & SHRI SONJOY SARMA, JM
O R D E R Per: Inturi Rama Rao, AM This appeal filed by the assessee is directed against the order of the National Faceless Appeal Centre, Delhi [CIT(A)] dated 31.12.2024 for Assessment Year (AY) 2017-18.
Brief facts of the case are that the appellant is an individual deriving income under the head ‘income from house property’. The appellant had not filed the return of income under the provisions of section 139(1) of the Income Tax Act, 1961 (the Act) for AY 2017- 18. Therefore, the AO issued a notice u/s. 142(1) of the Act on Sainaba 22.12.2017 calling upon the appellant to file the return of income. The appellant did not file return of income in response to the notice but filed the return of income on 23.05.2018 disclosing income of Rs. 16,15,140/-. Since the return of income was filed by the appellant is beyond the due date the AO treated the return of income as non est in the eyes of law and proceeded with making assessment. While doing so, the AO treated the cash deposits made in the bank account of Rs. 18,60,000/- as unexplained money of the appellant and also assessed the capital gains of Rs. 56,33,929/- on sale of property.
Being aggrieved, an appeal was filed before the CIT(A), who vide the impugned order partly allowed the appeal by directing the AO to restrict the addition in respect of unexplained cash deposits to the extent of Rs. 3,50,000/- only.
Being aggrieved, the appellant is in appeal before this Tribunal in the present appeal.
The learned counsel for the assessee submitted that the CIT(A) ought to have allowed the stamp duty of Rs. 18,000/-, registration charges of Rs. 2,000/- at the time of purchase of the property sold as cost of acquisition. It is further submitted that the CIT(A) ought not have confirmed the addition of Rs. 3,50,000/- on sale of property.
On the other hand, learned Sr. DR relying on the orders of the learned lower authorities submitted that no interference is called for.
Sainaba 7. We have heard the rival contentions and perused the material available on record. No evidence was filed before the CIT(A) in support of costs of acquisition of the property sold such as registration charge, etc. In the absence of any claim the question of allowance of the same does not arise. Similarly, no proof was filed in support of the availability of opening balance of Rs. 3,50,000/- and the CIT(A) rightly restricted the addition on account of unexplained cash deposit of Rs. 3,50,000/-. Therefore, we find no merit in the appeal filed by the assessee.
In the result, the appeal filed by the assessee stands dismissed.
Order pronounced in the open court on 31st July, 2025.