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Facts
The assessee sold immovable property in FY 2009-10, giving rise to capital gains, but failed to file an Income Tax Return for AY 2010-11. Consequently, the AO issued a notice under Section 148, completed an assessment under Section 144 read with Section 147, making additions for capital gains and other income. The CIT(A) dismissed the assessee's appeal, holding the land was not agricultural and gains were taxable, based solely on a remand report without considering the assessee's submissions.
Held
The Tribunal found the CIT(A)'s order cryptic and passed without affording proper opportunity or considering the assessee's detailed submissions. Therefore, the matter was remanded back to the CIT(A) for a fresh decision (de novo) on merits, ensuring a reasonable opportunity of hearing for the assessee.
Key Issues
The primary issues concerned the validity of the CIT(A)'s cryptic order which dismissed the appeal without considering the assessee's submissions, and whether the case should be remanded for a fresh adjudication on merits.
Sections Cited
139(1), 148, 143(2), 142(1), 144, 147
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, COCHIN BENCH
Before: SHRI INTURI RAMA RAO, AM & SHRI PRAKASH CHAND YADAV, JM
O R D E R Per: Inturi Rama Rao, AM This appeal filed by the assessee is directed against the order of the Commissioner of Income Tax (Appeals)-12, Bengaluru [CIT(A)], dated 27.06.2024 for Assessment Year (AY) 2010-11.
Brief facts of the case are that the assessee sold immovable property in the financial year 2009-10. The consideration received is chargeable to tax under the head ‘Capital Gains’. However, the Thomas Varghese appellant had not filed the return of income for AY 2010-11 under the provisions of section 139(1) of the Income Tax Act, 1961 (the Act). Therefore, the DCIT (Exemption), Thiruvananthapuram (hereinafter called "the AO") issued notice u/s. 148 of the Act to the assessee on 29.03.2017 calling upon the appellant to file the return of income for AY 2010-11. In response, the assessee filed the return of income without declaring the capital gain. Therefore, notices under sections 143(2) and 142(1) were issued to the assessee, which were not complied with. Under the circumstance the AO completed the assessment vide order dated 22.12.2017 passed u/s. 144r.w.s. 147 of the Act at a total income of Rs. 25,45,423/-. While doing so, the AO additions under the head ‘income from other sources” and ‘short term capital gain’.
Being aggrieved, an appeal was filed before the CIT(A), who vide the impugned order dismissed the appeal stating that the appellant failed to prove the nature of land sold.
Being aggrieved, the assessee is in appeal before the Tribunal in the present appeal. When the appeal was called nobody appeared on behalf of the assessee despite due service of notice of hearing. Therefore, we proceeded to dispose of the appeal after hearing the learned Sr. DR.
We find that the learned CIT(A) dismissed the appeal by a non speaking order stating that “since the land sold by the assessee is not Thomas Varghese an agricultural land, the capital gains resulting from such sales are taxable”. The CIT(A) passed the cryptic order solely on the basis of the remand report of the AO, without considering the detailed submission filed by the appellant. Under this circumstance, we are of the considered view that the matter requires to be remanded to the file of the CIT(A) with the direction to dispose of the appeal de novo on merits after affording reasonable opportunity of hearing to the assessee.
In the result, the appeal filed by the assessee is allowed for statistical purposes Order pronounced in the open court on 4th February, 2025.