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Facts
The assessee appealed against an assessment order (AY 2016-17) passed under section 147 r.w.s 144, and an ex-parte appellate order from the CIT(A) passed under section 250, which upheld an addition of Rs. 66,78,350/- as short-term capital gain on land sale. The assessee's counsel claimed non-appearance before lower authorities was due to an advocate's mistake and sought a fresh opportunity to present facts and documents. The CIT(A) had not decided the issues as per section 250(6).
Held
The Tribunal found that the CIT(A) did not decide the issues properly as per Section 250(6) of the Act. With no objection from the Revenue, the Tribunal set aside the CIT(A)'s order and remitted the case back to the Assessing Officer for fresh, de novo adjudication. The assessee was granted an adequate opportunity to present all relevant documents, with a cost of Rs. 2000/- imposed for non-compliance, payable to the Prime Minister National Relief Fund.
Key Issues
Whether ex-parte orders by the CIT(A) and AO are valid; whether the addition of Rs. 66,78,350/- as short-term capital gain on land sale is justified, considering the assessee's claim of it being long-term capital gain or exempt agricultural income; whether the notice under section 148 was time-barred; and applicability of various penalties and interest charges under the Income Tax Act.
Sections Cited
139, 144, 147, 148, 148A, 210, 234A, 234B, 234C, 234D, 250, 250(6), 271(1)(b), 271(1)(c), 271F
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Before: DR. ARJUN LAL SAINI, & SHRI DINESH MOHAN SINHA
सुनवाईक�तार�ख/Date of Hearing : 18/08/2025 घोषणाक�तार�ख/Date of Pronouncement : 19/08/2025 आदेश / O R D E R PER DR. ARJUN LAL SAINI, ACCOUNTANT MEMBER: Captioned appeal filed by the assessee, pertaining to Assessment Order (AY) 2016-17, is directed against the order under section 250 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) passed by the National Faceless Appeal Centre (NFAC), Delhi/Commissioner of Income Tax(Appeals) (in short “Ld.CIT(A)”,dated 12.03.2025, which in turn arises out of an assessment order passed by the Assessing Officer u/s 147 r.w.s 144 of the Act, dated 28.02.2024.
2. The assessee has raised the following grounds of appeal:-
“01. That the Ld. National Faceless Appeal Center(NFAC) has erred both in law and on facts while passing the order u/s 250 of the Income tax Act 1961 and therefore it requires to be set aside.
That the Ld. National Faceless Appeal Center has not considered the reply filed on 11/03/2025, however without considering the same order passed Ex- parte is bad in law illegal and prejudicial to the interest of the appellant, hence the order passed by National Faceless Appeal Center is required to be re- consideration.
That the addition sustained by the Ld. NFAC AO of Rs. 66,78,350/- as short term capital gain for A.Y 2016-17 is against the facts on record, therefore the heavy addition made by Ld. A.O. is require to be deleted.
4. That the notice issued u/s 148 of the IT Act 1961 is barred by limitation and without jurisdiction and therefore the notice issued u/s 148 dated 24/03/201 require to be quashed.
5. That the assessee has filed his reply on 04/03/2023 against the notice u/s 148A of the IT Act. 1961 as well as on 21/11/2023 against the notice dated 09/11/2023 however without considering the reply the order passed by A.O. u/s 144 of the IT Act, is against the principal of natural justice and therefore the heavy addition made of Rs. 66,78,350/- as short term capital gain is required to be deleted.
6. That the appellant has purchased the land under question on 06/08/2010 and sold on 19/06/2015 which is Long term capital gain, however without making proper inquiry addition made as short term capital gain is against the provision of section 148A and sec. 148 of the IT Act 1961 and therefore the assessment made may please be quashed.
That the assessee is an agriculturist and sold the agriculture land which is exempt however without appreciating the facts, and without making further inquiry addition made as short term capital gain of Rs 66,78,350/- is against the documents available on records and therefore the heavy addition made of Rs 66,78,350/-requires to be deleted.
That the appellant has not furnished any inaccurate particulars of Income as well as not concealed and Income and therefore the penalty proceedings Initiated us 271(1)(c) of the IT Act. 1961 is requires to be dropped.
That the assessee has complied the notices of the AO however without considering the reply filed, penalty initiated u/s 271(1)(b) is against the facts on record and as such the penalty initiated u/s 271(1)(b) of the IT Act 1961 requires to be dropped.
That the appellant is an individual and not having any taxable Income and as such not required to file Income Tax return u/s 139 of the Income Tax Act 1961 Therefore, the penalty initiated u/s 271F of the Income Tax Act 1961 is require to be dropped.
A.Y.16-17 Mahendrakumar Bhanjibhai Chaniyara 11. That the appellant has neither committed default of Sec. 210 nor made any default in payment of advance tax and therefore unwanted interest charged us 234A 234B, 234Cand 234D requires to be deleted.
Your appellant craves leave to add, amend, deleted or alter any of the grounds till the appeal is finally heard and decided.
3. At the outset Ld. Counsel for the assessee submitted that the Assessing Officer passed assessment order u/s 147 r.w.s 144 of the Act, and Ld. CIT(A) passed appellate order in ex-parte proceedings. The Ld. Counsel for the assessee submitted that assessee has neither appeared before the assessing officer nor before the Ld. CIT(A) due to mistake committed by the advocate of the assessee. The Ld. Counsel submitted that now assessee is ready with the documents and wants to furnish the details and documents before lower authorities. The Ld. Counsel therefore prayed before the Bench that one more opportunity should be given to assessee to plead his case before Assessing Officer.
The Ld. Sr-DR of the Revenue has raised no objection if the matter is remitted back to the file of lower authorities, however, he submitted that cost should be imposed on the assessee on account of non-compliance attitude of the assessee.
We have heard both the parties and gone through materials available on record. We note that ld. CIT(A) has not decided the issue in respect of the ground raised
by the assessee in Memo of Appeal as per the mandate of provisions of section 250(6) of the Act. The Ld. AR of the assessee requested to set aside the order of CIT(A) and requested the Bench that matter may be remitted back to the file of the Assessing Officer for fresh adjudication and undertook the responsibility that all the details would be filed before Assessing Officer if another opportunity is granted to the appellant. On account of non-compliance attitude of the assessee, we A.Y.16
17. Mahendrakumar Bhanjibhai Chaniyara impose a cost of Rs. 2000/- on the assessee which is to be deposited in the account of Prime Minister National Relief Fund. The Ld. Sr-DR has also no objection if the matter is restored to the file of Assessing Officer. In view of the above facts, we deem it proper to set aside the order of CIT(A) and restore the matter back to the file of Assessing Officer for fresh adjudication after granting adequate and fair opportunity of being heard to the assessee. It is needless to say that assessee will be at liberty to adduce any evidences, as deemed relevant before the Assessing Officer at the time of de novo assessment proceedings, in consequence to this order and the Assessing Officer shall allow the assessee adequate opportunity of being heard and to make relevant submissions, and then pass a speaking order, which is fair and judicious. Accordingly, appeal of assessee is allowed for statistical purposes.
In the result, appeal of the assessee is allowed, for statistical purposes.
Order is pronounced on 19/08/2025 in the Open Court.
Sd/- Sd/- (DINESH MOHAN SINHA) (DR. ARJUN LAL SAINI) �या�यकसद�य/Judicial Member लेखासद�य/ Accountant Member राजकोट/Rajkot �दनांक/ Date: 19/08/2025 ak आदेशक���त�ल�पअ�े�षत/ Copy of the order forwarded to : अपीलाथ�/ The Appellant ��यथ�/ The Respondent आयकरआयु�त/ CIT आयकरआयु�त(अपील)/ The CIT(A) �वभागीय��त�न�ध, आयकरअपील�यआ�धकरण, राजकोट/ DR, ITAT, RAJKOT गाड�फाईल/ Guard File By order/आदेशसे,
सहायकपंजीकार आयकरअपील�यअ�धकरण, राजकोट