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Facts
The assessee's appeal was filed with a delay of 226 days, citing illiteracy and her husband's health issues. The Assessing Officer reopened the assessment, claiming the assessee sold property for capital gains, using a guideline value of ₹.87 per sq.ft. The assessee claimed it was agricultural land, not subject to capital gains tax, and paid stamp duty based on the guideline value for agricultural land.
Held
The Tribunal condoned the delay, admitting the appeal. It noted that the assessee provided evidence, including a VAO certificate, confirming the land was agricultural and beyond 8 km from municipal limits. The stamp duty paid was as per the guideline value for agricultural land, and the Assessing Officer's reopening of the assessment lacked new or tangible information.
Key Issues
Whether the land sold by the assessee was agricultural land, not subject to capital gains tax, and if the reopening of assessment by the AO was justified.
Sections Cited
54B, 54F, 143(3), 148, 2(14)
AI-generated summary — verify with the full judgment below
Before: Shri S.S. Viswanethra Ravi & Ms. S. Padmavathy
O R D E R
PER S.S. VISWANETHRA RAVI, JUDICIAL MEMBER:
This appeal filed by the assessee is directed against the order dated 04.02.2025 passed by the ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre [NFAC], Delhi for the assessment year 2014-15.
We find that this appeal is filed with a delay of 226 days. The assessee filed an affidavit for condonation of delay explaining the reasons that she is an illiterate and her husband has to look after the tax matters of the assessee, who was diagnosed of Cancer expired in March, 2024 after prolonged medical treatment and filed complete medical records. Upon hearing both the parties and on examination of the said affidavit, etc., in the interest of justice, we condone the delay and admit the appeal for adjudication.
Ground No. 1 is general in nature and requires no adjudication.
Ground Nos. 5 to 12 raised by the assessee in challenging the action of the ld. CIT(A) in confirming the addition made under section 54B of the Income Tax Act, 1961 [“Act” in short].
At the outset, we note that the assessee is an individual and filed return of income declaring a total income ₹.2,87,700/- and the Assessing Officer completed the scrutiny assessment under section 143(3) of the Act by making addition of ₹.3,00,900/- on account of claim of deduction under section 54F of the Act and determined the total income of the assessee at ₹.5,88, 600/- vide assessment order dated 15.11.2016. We note that the said assessment was reopened by issuing a notice dated 06.03.2020 under section 148 of the Act, the reasons of which, the Assessing Officer reproduced at page 12 of the impugned order. We note that according to the Assessing Officer, the assessee sold the property to an extent of ₹.47,50,000/- vide sale deed document No. 2158/2013 on 29.04.2013. Further, the assessee also sold another property to an extent of 2 acres 22 cents in Sy. Nos. 228/3 and 229/3 for a consideration of ₹.55,50,000/- through unregistered sale deed. Further, the Assessing Officer observed that the guideline value of the said property as per website www.tnreginet.com fixed at ₹. 87 per sq. ft. as on 01.4.2012, accordingly, the Assessing Officer computed long term capital gain to an extent of ₹.1,48,21,447/- which was confirmed by the ld. CIT(A). We note that the assessee contended specifically that it is an agricultural land does not come under the purview of capital gain as it is not an asset under section 2(14) of the Act. Further the assessee contested that the Sub-Registrar levied and collected stamp duty in accordance with the guideline value and the value adopted by the Assessing Officer is not acceptable.
We find that the assessee filed VAO certificate showing that subjected land is an agricultural land and situated beyond 8 km from the Municipal Corporation limits. We find from the impugned order that an issue of as to whether subjected land is an agricultural land or not? was discussed by the ld. CIT(A) in his order at page No. 17. To that effect the assessee filed Village Administrative Officer’s certificate stating that the subjected land is an agricultural land. The ld. CIT(A) sought remand report from the Assessing officer and his demand report is reproduced in page 18 of the impugned order. On perusal of the said report, we note that the Assessing Officer did not give any observation with reference to the subjected land is whether agricultural land or not, but, however doubted that there was no mention of FY13-14 (AY14-15) relevant to the year under consideration in the said report. Further, according to the Assessing Officer that the assessee is filing returns from AY 08-09 and there was no claim of agricultural income. We find no adverse finding in the remand report of the Assessing Officer regarding the location of the subjected land. Therefore, we can safely conclude that the certificate issued by the VAO is correct with reference to location of subjected land is situated beyond 8km from the Municipal Corporation Limits. Supporting the same the sale dated 22.04.2013 in vernacular language at page No. 37 of the paper book and we find a true translation in English language in Page No. 1 of other paper book. On an examination of the endorsement of office of the Sub-Registrar at page No. 49 of the paper book, we note that the assessee paid stamp duty at ₹.3,22,500/-, further, the details of value assessed for the purpose of stamp duty is at ₹.3,32,500/- and that the assessee paid stamp duty at ₹.3,32,500/- including the value of stamp papers of ₹.10,000/-. Therefore, we find force in the arguments of ld. AR that the assessee paid stamp duty as per guideline value fixed by Sub- registrar for agricultural land, thus we find no basis for the value fixed by the Assessing Officer at ₹.87 per sq.ft taking into account the information from website tnreginet.com. Therefore, we find no basis for the Assessing Officer in reopening the assessment, which was already concluded under section 143(3) of the Act and we hold there was no new information or tangible information with the Assessing Officer to reopen the assessment as the assessee furnished every detail before the Assessing Officer in the original assessment proceedings in respect of the subjected property and therefore, we delete the addition made by the Assessing Officer and set aside the order of the ld. CIT(A). Thus, grounds Nos. 5 to 12 are allowed.
In view of our decision in ground Nos. 5 to 12 in favour of the assessee, the issue raised in ground Nos. 2 to 4 become academic requiring no adjudication.
In the result, the appeal of the assessee is allowed. Order pronounced on 19th February, 2026 at Chennai.