TaxTMI 
TaxTMI 
2026 (9) TMI 312
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....rned CIT(A) has erred in confirming the action of assessing officer in making addition of Rs. 30,00,000/- u/s 69 of the I.T Act as Long Term Capital Gain. 3. It is therefore prayed that the above additions made by the assessing officer and confirmed by the learned CIT(A) may please be deleted. 4. Appellant craves leave to add, alter or delete any ground(s) either before or in the course of hearing of the appeal." 2. Facts of the case, in brief, are that original return of income under Section 139(1) of the Income Tax Act, 1961 (in short, the Act) was filed for the A.Y. 2011-12 on 08/02/2012 declaring total income at Rs. 4,90,690/-. The case was processed under Section 143(1) of the Act. Subsequently, the Assessing Officer received information that the assessee jointly with three other persons viz. Shri Brijeshbhai Parshottambhai, Smt. Manjulaben Khodidas and Smt. Jignaben Parshottambhai have sold an immovable property which was registered with Sub-Registrar office, Athwa, Surat for a value of Rs. 80.00 lacs on 24/09/2010. However, the capital gains accrued on this transfer of capital assets has not been disclosed by the assessee in its return of income. The cas....
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....ties all having equal sales consideration of Rs. 80.00 lacs each has been sold by the assessee in which the assessee was a co-owner. The Assessing Officer, therefore, worked out the capital gain and added a sum of Rs. 30.00 lacs under Section 69 of the Act. 3. Aggrieved by the order of the Assessing Officer, the assessee filed appeal before the ld. CIT(A), who vide the impugned order dated 16/09/2025, dismissed the appeal of the assessee and confirmed the addition made by the Assessing Officer on the ground that the assessee has failed to furnish any proof or evidence to substantiate the entire transactions made in the sales and purchase of said properties. 4. Further aggrieved by the order of the ld. CIT(A), the assessee is in appeal before this Tribunal. 5. During the appellate proceedings before us, the assessee has filed written submission as under: "1. The assessee, Shri Dharmesh Ukani, is engaged in textile business and filed his return of income for A.Y. 2011-12 declaring total income of Rs. 4,90,690/-. 2. The case was reopened under section 147 on the basis of information that the assessee, along with three co-owners, had executed three sale deeds....
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....opening, and it is a settled position that the Assessing Officer is mandatorily required to dispose of such objections by passing a speaking order before proceeding with assessment and failure to do so vitiates the reassessment proceedings in view of decision of Champalal Omprakash v. Income-tax Officer [2024] 159 taxmann.com 1397 (Kolkata - Trib.) dated 15.01.2024 7. The assessee further submits that neither full consideration was received nor possession of property was transferred, hence, no completed transfer took place and no capital gains would arise. The addition under section 69 is also not sustainable as the case does not involve any unexplained investment. The Assessing Officer, without making inquiry from purchasers, made an addition of Rs. 30,00,000/- treating it as long-term capital gain and invoked section 69 of the Act on a presumptive basis. 8. There is one major dimension of arguments which has not been considered by the Assessing officer. The lands are situated in Bhatpore and during Financial Year 2010-11 relevant to A.Y. 2011-12, Bhatpore village was not included within the limits of Surat Municipal Corporation (SMC). The inclusion of Bhatpore w....
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.... exception clause of section 2(14), i.e., whether it is situated beyond the prescribed distance from the limits of a municipality or cantonment board having regard to the population criteria as on the date of transfer. The assessee's claim that Joharapuram Village was included in Kurnool (Urban) Mandal only with effect from 29.03.2018 on the basis of G.O.MS. No. 144 dated 29.03.2018, and the Revenue's contention that the land falls within the municipal limits based on notifications issued by the Municipal Administration and Urban Development Department, Government of Andhra Pradesh, clearly require detailed factual verification. In our considered view, determination of whether the impugned land is a capital asset or not within the meaning of section 2(14) of the Act involves verification of the exact location of the land, the distance of the land from the nearest municipal limits as on the date of sale, the applicability of the relevant notifications in force during the year under consideration and the nature and use of the land at the relevant point of time. Since these aspects have not been properly examined by the lower authorities, we are of the considered view that the....