Tribunal reinstates original assessment order under Section 263, assessee's appeal allowed

The Tribunal found that the assessment order was not erroneous or prejudicial to the Revenue's interests. It concluded that the Assessing Officer had conducted proper inquiries and considered the relevant material. The Tribunal set aside the order under Section 263 of the Income Tax Act and reinstated the original assessment order, directing the Commissioner of Income Tax (Appeals) to decide the appeal against the original assessment order on its merits. Consequently, the appeal of the assessee was allowed.

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Issues Involved:
1. Validity of the revised return filed by the assessee.
2. Applicability of Section 50C regarding the sale consideration for property sold to Shri Shanti Bhushan and others.
3. Enquiry into income from house property and income from other sources.

Issue-wise Detailed Analysis:

1. Validity of the revised return filed by the assessee:
The Ld. CIT found that the revised return filed by the assessee on 1st July 2013 was non-est because it was filed after the expiry of one year from the end of the relevant assessment year, contrary to the provisions of Section 139(5) of the IT Act. The A.O. made the assessment based on this non-est return, which rendered the assessment order erroneous and prejudicial to the interests of the Revenue. The assessee contended that the revised computation was to correct the long-term capital gains, and the A.O. completed the assessment after due enquiry. However, the Ld. CIT held that any claim for deduction not made in the original return could only be entertained through a valid revised return, as per the Supreme Court ruling in Goetze (India) Ltd. v. CIT [2006] 284 ITR 323.

2. Applicability of Section 50C regarding the sale consideration for property sold to Shri Shanti Bhushan and others:
The Ld. CIT noted that the A.O. should have considered the value of the plot at Rs. 19,07,79,830 for computing long-term capital gains, as per Section 50C, instead of Rs. 1 lakh as per the Conveyance Deed. The Sub-Registrar had valued the portion sold to Shri Shanti Bhushan and others at Rs. 19,07,79,830, which should have been adopted for stamp duty purposes. The assessee argued that the Agreement to Sale dated back to 1966, and due to litigation, the Sale Deed was executed in 2010. The assessee relied on the Supreme Court decision in Sanjeev Lal v. CIT [2014] 365 ITR 389, which held that the date of the Agreement to Sale should be considered the date of transfer for capital gains purposes. The Tribunal agreed with the assessee, holding that the sale consideration should be taken as per the 1966 agreement, and Section 50C would not apply.

3. Enquiry into income from house property and income from other sources:
The Ld. CIT found that the A.O. did not make any enquiry regarding the income from house property declared at Rs. 2863 and income from other sources declared at Rs. 40,64,754. The Tribunal noted that the assessee had filed detailed replies regarding these incomes during the assessment stage, and the A.O. had considered these details. Therefore, it was not a case of no enquiry.

Conclusion:
The Tribunal concluded that the assessment order was not erroneous or prejudicial to the interests of the Revenue. The A.O. had made enquiries and considered the material on record. The Tribunal set aside the order under Section 263 of the I.T. Act and restored the original assessment order. The Ld. CIT(A) was directed to decide the appeal against the original assessment order on merits.

Result:
The appeal of the assessee was allowed.

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