In a ruling by the Chennai Bench of the Income Tax Appellate Tribunal (ITAT), it was determined that the burden of proof lies with the assessee to demonstrate that the capital gains did not accrue to her.
In consideration of the principle of natural justice, the ITAT has decided to provide the assessee with an additional opportunity to substantiate her case. Consequently, the appeal has been returned to the file of the Commissioner of Income Tax (Appeals) [CIT (A)] for a fresh adjudication.
The assessee Mrs.P.Selvamani Ranjithan sold vacant land measuring 48,473 square feets for Rs.188.90 Lakhs through a power holder. The sale deed was executed by the power of attorney holder on behalf of the assessee. Since the assessee did not file return of income, the case was reopened and impugned assessment was framed.
The Assessing Officer (AO) computed capital gains in the hands of the assessee. However, benefit of indexation was not granted to the assessee. The Long-Term Capital Gains thus assessed to be Rs.185.70 Lakhs.
Aggrieved by the order, the assessee filed an appeal before the CIT(A), which concluded that the assessee was the absolute owner and the property was registered and the sale consideration was received on behalf of the assessee by the power holder, thus upheld the decision of AO and dismissed the case on no legal grounds.
The Bench comprising of Mahavir Singh, Vice President and Manoj Kumar Aggarwal, Accountant Member observed that though the assessee has made certain submissions in support of her claim, it has miserably failed to substantiate the same.
Additionally, it was noted that all the presented facts and documents serve to bolster the revenue’s argument, indicating that the assessee was the rightful owner of the property and that the property was sold through the power of attorney on behalf of the assessee. Therefore, the responsibility lies with the assessee to provide evidence that the capital gains did not accrue to her.
Hence, considering the stated factual matrix and keeping in mind the principle of natural justice, the Bench granted another opportunity to the assessee to substantiate her case. The appeal has been returned to the file for a fresh adjudication, while keeping all matters open, and the assessee has been instructed to substantiate her case accordingly.
D. Anand appeared on behalf of assessee as Authorized Representative and AR. V. Sreenivasan as Departmental Representative.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
