USHABEN MAGANBHAI PATEL,VADODARA vs. THE ITO, WARD-1(2)(5) NOW WARD-1(2)(1), VADODARA

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ITA 210/AHD/2023Status: DisposedITAT Ahmedabad06 March 2024AY 2011-12Bench: Ms. SUCHITRA KAMBLE (Judicial Member), SHRI WASEEM AHMED (Accountant Member)4 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal found that the assessee had a valid reason for not attending the CIT(A) proceedings. Therefore, the matter was remanded back to the CIT(A) to provide the assessee with an opportunity of hearing and to adjudicate the issues after considering the evidence.

What were the facts?

The assessee failed to file a return of income for AY 2011-12, leading to reassessment proceedings. The CIT(A) passed an ex-parte order dismissing the assessee's appeal. The assessee claimed the ex-parte order was due to their tax consultant not informing them of the proceedings.

What were the issues?

Whether the CIT(A) erred in passing an ex-parte order without granting the assessee an opportunity of hearing, and whether the grounds raised by the assessee regarding additions and disallowances are valid.

Which sections of the Income-tax Act were involved?

Section 139(1),Section 147,Section 148,Section 143(2),Section 69A,Section 50C,Section 54B,Section 54F,Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, AHMEDABAD “D” BENCH, AHMEDABAD

Before: Ms. SUCHITRA KAMBLE & SHRI WASEEM AHMED

For Appellant: Shri Niraj Shah, AR
For Respondent: Smt. Malarkodi R, Sr. DR
Hearing: 28.02.2024Pronounced: 06.03.2024

PER SUCHITRA KAMBLE, JUDICIAL MEMBER:

1.

This appeal is filed by the assessee against order dated 13.02.2023 passed by the CIT(A), National Faceless Appeal Centre (NFAC), Delhi for the Assessment Year 2011-12.

2.

The assessee has raised the following grounds of appeal :-

“1. The CIT(A) have erred on facts and in law in passing Ex-parte Order under Section 250 of the I.T. Act and not allowing the appeal filed against the Assessment Order. 2. The CIT(A) has erred on facts and an law in making addition of Rs.11,00,000/- under Section 69A of unexplained cash deposits in Bank Account 3. The CIT(A) has erred on facts and in law in determining the value of land under Section 50(C) as Rs.1,76,23,200/- instead of Rs.1,50,00,000/- Assessment Year: 2011-12 Page 2 of 4 4. The CIT(A) has erred on facts and in law in disallowing the legal expenses amounting to Rs.1,50,000/- and Rs.37,500/- respectively on sale of immovable property.

5.

The CIT(A) has erred on facts and in law by disallowing exemption under Section 54B amounting to Rs.32,70,210/- claimed against the long-term capital gain arising out of sale of immovable property under Section 54B of IT Act, 1961.

6. The CIT(A) has erred on facts and in law in disallowing exemption under Section 54F amounting to Rs.35,63,534/- by making addition on account of long-term capital gain arising out of purchase of residential property under Section 54F in her son’s name.

7. The CIT(A) has erred on facts and in law in passing the order in favour of the co-owner of the appellant for the same piece of land located in Block no.27 and 28 of Shokhda Khurd, Padra Taluka, Vadodara.

3.

The assessee did not submit her return of income for assessment year 2011-12 as per provisions of Section 139(1) of the Income Tax Act, 1961. The Assessing Officer observed that the assessee deposited cash aggregating to Rs.11,00,000/- in her bank account with Dena Bank, purchased immovable property for Rs.49,05,000/- on 26.10.2010, sold immovable property for Rs.1,50,00,000/- on 28.03.2011 along with one other co-owner and sold immovable property for Rs.75,00,000/- on 14.12.2010 along with other three co- owners. Action under Section 147 of the Act was initiated in assessee’s case and notice under Section 148 of the Act dated 27.03.2018 was issued to the assessee. After taking approval from the PCIT in response to notice under Section 148 of the Act, the assessee submitted her return of income dated 25.04.2018 declaring total income at Rs.40,120/-. Notice under Section 143(2) of the Act dated 21.06.2018 was served upon the assessee. The Assessing Officer observed that the assessee had made cash deposits aggregating to Rs.11,00,000/- in her bank account, and after taking cognizance of the reply of the assessee, made addition of Rs.11,00,000/- under Section 69A of the Act as unexplained cash deposits in bank account. The Assessing Officer also made addition of Rs.82,95,844/- as long-term capital gain on selling of immovable properties as well as addition of Rs.17,83,902/- towards another long-term capital gain regarding the second transaction of transfer of land.

Assessment Year: 2011-12 Page 3 of 4 4. Being aggrieved by the Assessment Order, the assessee filed appeal before the CIT(A). The CIT(A) dismissed the appeal of the assessee.

5. The Ld. AR submitted that since the assessee was not aware about the proceedings of the CIT(A) as the assessee’s Tax Consultant has not informed the assessee about the notices issued by the CIT(A) and hence the assessee could not attend the proceedings before the CIT(A). The CIT(A) has passed ex-parte order and, therefore, the matter may be remanded back to the file of the CITA).

6.

The Ld. DR relied upon the Assessment Order and the order of the CIT(A)

7.

We have heard both the parties and perused all the relevant material available on record. It is pertinent to note that the assessee has given valid reason for not attending the proceedings before the CIT(A) as the assessee’s Tax Consultant has not guided/advised the assessee about the notices of hearing. Therefore, in the interest of justice, the assessee be given opportunity of hearing by following the principles of natural justice. The CIT(A) is directed to adjudicate the issues contested by the assessee after taking the evidences on record and decide the matter as per the provisions of law.

8.

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

Order pronounced in the open Court on this 6th March, 2024.

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