GUMAN SINGH KUSHWAH,SHIVPURI vs. INCOME TAX OFFICER, ASHOKNAGAR

One of the ground raised before me is that the learned NFAC had mechanically confirmed the order of the ld AO without giving his independent findings. This goes to the root of the matter and hence I proceed to address the same first.

I have heard the rival submissions and perused the materials available on record. The return of income for the assessment year 2014-15 was filed by the assessee on 24-12-2014 declaring total income of Rs. Page | 1 2,16,260. The assessment was originally completed under section 143(3) of the Act on 19-12-2016 determining total income at Rs. 9,86,530. The Learned AO noted in the assessment order that as per information available, the assessee had purchased residential plot for Rs. 71 lakhs and seller has not provided his PAN to the assessee for complying the provisions of section 194 IA of the Act and accordingly, tax was required to be deducted at source at the rate of 20% as per section 206AA of the Act by the assessee. Further, the assessee had sold property for Rs. 4 lakhs for which the market value was Rs. 12,40,000. Hence, these two aspects were considered to be income escaping assessment in the hands of the assessee and accordingly, the assessment was reopened vide issuance of notice under section 148 of the Act on 30-3-2021. In response to the notice under section 148 of the Act, the assessee did not file any return of income nor filed any written submissions. The Learned AO issued notices under section 142(1) of the Act on 29-06-2021, 10-12-2021 and 11-1-2022 to furnish the requisite reply. Since there was no response from the side of the assessee, the assessment was completed under section 144 read with section 147 of the Act by the Learned AO. In the reassessment order, the Learned AO noted that assessee had purchased plot for Rs 71 lakhs during the year under consideration from Mr. Purushottam Khandelwal. The seller had not provided his PAN to the assessee. Hence, the assessee should have deducted TDS at the rate of 20% under section 194IA r.w.s. 206AA of the Act in the absence of PAN, whereas, the assessee had deducted TDS at the rate of 1% only. For this, the Learned AO proceeded to make an addition of 30% of the purchase consideration amounting to Rs 21 lakhs(7100000 * 30%) by applying the provisions of section 201 of the Act. Further, the assessee had sold a property on 25-10-2013 for Rs 4 lakhs. The market value of the same was determined by the stamp duty authorities at Rs 12,40,000. Accordingly, the Learned AO applied the provisions of section 50C of the Act and sought to substitute the sale consideration at Rs 12,40,000. Since there were no details filed by the assessee for the cost of acquisition, the Learned AO estimated the indexed cost of acquisition at Rs 1,00,000 and recomputed the long term capital gains at Rs 11,40,000 and completed the reassessment. The assessee challenged the reassessment order before the Learned NFAC. On perusal of the order of the ld NFAC, I find that the ld NFAC had decided the issue ex parte without adjudicating the issue on merits giving its independent finding. Hence, in the interest of justice and fairplay, I deem it fit and appropriate to restore this appeal to file of ld NFAC for de novo adjudication in accordance with law. Needless to mention the assessee be given reasonable opportunity of being heard. The assessee is directed to cooperate with ld NFAC for expeditious disposal of the appeal by not taking unwarranted adjournments. Hence, the grounds raised by the assessee are allowed for statistical purposes.