The Hyderabad Bench of Income Tax held that the assessee was not present before the Commissioner of Income Tax Appeals [CIT(A)] in the appellate proceedings and has not filed any document to substantiate his case, thus remanded the case to the file of Assessing Officer(AO) to review the claim of deduction under Section 54F of the Income Tax Act,1961.
The assesse Subba Raju Chekuri, has not filed his return of income for the A.Y.2012-13 disclosing the capital gains on sale of immovable property during the financial year 2011-12 for a sale consideration of Rs.34,83,000/- whereas the market value of the said property was of Rs. 77,50,000/-.
As per the data available, in the absence of PAN details, the AO noticed that there was an escapement of income and hence, he issued notice under Section 148 of the Income Tax Act to the assessee. Thereafter, notice under Section 142(1) of the Income Tax Act dated was also issued calling for certain information for which the assessee submitted that during the financial year 2011-12, he had sold two immovable properties in the status of HUF (Hindu Undivided Family.
The Information submitted by the assessee was not accepted by the AO as he has not submitted supporting documents to claim deduction under Section 54F of the Income Tax Act till date and as there was no other option except to complete the assessment ex-parte under Section 144 of the Income Tax Act, AO completed the assessment.
During the course of scrutiny proceedings, it was noticed that assessee sold the land admeasuring 774.5 Sq yards situated at Kakinada for a sale consideration of Rs. 34,83,000/- whereas the market value of the property for the purpose of payment of stamp duty was Rs. 77,50,000/-
Aggrieved by the order the assessee filed an appeal before the CIT(A, which upheld the decision of AO and dismissed the appeal.
The Authorised Representative (AR) of the assessee submitted that the major issue in the present case is with respect to the application of Section 50C of the Income Tax Act in respect of capital gains and alternatively, claiming deduction under Section 54F of the Income Tax Act.
The AR further submitted that the order passed by the lCIT(A) is an exparte order, as the assessee has failed to provide necessary information and appear during the course of appellate proceedings.
The Departmental Representative (DR) relied on the orders of lower authorities.
The Single Member Bench comprising of Laliet Kumar, Judicial Member observed that it is abundantly clear that the assessee was not present before the CIT(A) in the appellate proceedings and has not filed any document to substantiate his case.
Therefore the Tribunal remanded back the matter to the file of AO with a direction to review the claim of deduction under Section 54F of the Income Tax Act made by the assessee specifically with respect to the application of Section 50C of the Income Tax Act and the eligibility for deduction under Section 54F of the Income Tax Act.
In case, the assessee failed to file any documents in support of his case, the AO shall decide the matter in accordance with the law.
Hence, appeal of the assessee was allowed for statistical purposes.
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