V.KAMALAM,CHENNAI vs. ITO, KUMBAKONAM

This appeal by the assessee is directed against the order passed by the Ld. Commissioner of Income Tax (Appeals)-2, Tiruchirappalli dated 01.02.2017 in 2)/TRY for the assessment year 2010-11 passed u/s.250(6) r.w.s.144 of the Act.

The assessee has raised several grounds in her appeal, however the crux of the issue argued before us was that the Revenue had denied the benefit of deduction U/s.54F of the Act to the assessee even though she was entitled for the same and further erred by making addition towards unexplained investment of Rs.5,81,200/-.

The brief facts of the case are that the assessee is an individual earning income from salary, filed her return of income for the assessment year 2010-11 on 16.07.2010 admitting total income of Rs.1,75,350/-. Initially the return was processed u/s.143(1) of the Act and subsequently the case was selected for scrutiny and finally assessment order was passed U/s. 144 of the Act on 28.03.2013, wherein the Ld.AO denied the benefit of deduction under Section 54F of the Act and thereby computed the Long Term Capital Gain of the assessee at Rs.3,06,058/- and also made addition of Rs.5,81,200/- as unexplained investment.

During the scrutiny assessment proceedings, it was observed by the Ld.AO that the land belonging to the assessee was acquired by the Government, wherein she received compensation of Rs.4,20,025/- after deducting TDS of Rs.42,003/-. The assessee had explained before the Ld.AO that subsequently she had purchased a residential property for Rs.9,00,000/-. Since the assessee had not provided sufficient materials to justify her claim for deduction U/s.54F of the Act and further did not furnish details about the source of investment for Rs.5,81,200/- in the newly acquired property, the Ld.AO denied the benefit of Section 54F of the Act to the assessee and made addition of Rs.5,81,200/- as unexplained investment by passing an ex-parte order.

The Ld.CIT(A) also confirmed the order of the Ld.AO because even before him, the assessee was not able to substantiate her claim.

At the outset the Ld.AR submitted before us that one more opportunity may be provided to the assessee in order to present the case before the Ld.AO, because she is in possession of all the documents required for substantiating her claim. The Ld.DR strongly opposed to the submission of the Ld.AR.

After hearing both sides, I do not find much force in the argument advanced by the Ld.AR. However, in the interest of justice, I hereby remit the matter back to the file of Ld.AO for de-nova consideration there by providing one more opportunity to the assessee of being heard.

In the result, the appeal of the assessee is allowed for statistical purposes.