Om Shivam Farms Pvt. Ltd. vs ITO, Ward 44(3), Delhi

PER RAMIT KOCHAR, AM: This appeal is filed by the assessee against the order passed by learned Commissioner of Income Tax(Appeals) NFAC, Delhi [CIT(A), in short] dated 13.11.2025 u/s 250 of the Income-tax Act, 1961 (DIN & Order No. ITBA/NFAC/S/ 250 / 2025-26/1082569817(1)) , which appeal in turn has arisen from the assessment order dated 23.05.2023 passed by learned Assessing Officer u/s. 147 r.w.s. 144B of the 1961 Act(DIN:ITBA/AST/S/147/2023-24/1053073394(1)).

Brief facts of the case are that the assessee filed its return of income on 29.09.2014, declaring income of Rs. 12,120/-. The case of the assessee was reopened by Revenue u/s 147 of the 1961 Act. Order u/s 148A(d) of the Income Tax Act, 1961 was passed by the AO , on 19.07.2022. Notice u/s 148 of the 1961 Act was issued by the AO to the assessee, on 19.07.2022. The assessee in response to aforesaid notice, filed return of income on 28.01.2023 , declaring total income of Rs. 12,120/-. Statutory notices u/s 143(2) , 142(1) and SCN’s were issued by the AO to the assessee during the course of reassessment proceedings. The details are recorded by the AO in the reassessment order at page 1 and 2. The assessee participated in reassessment proceedings, but, however, furnished part replies before the AO during the course of reassessment proceedings. Genesis of the reopening of the concluded assessment was that information was received by the AO from JCIT(OSD), Central Circle-1, NOIDA , that a search and seizure operations were carried out by Revenue on 11.10.2018 at the premises of the assessee comprising ‘PMC Fincorp Group of cases’, which comprised 5 sub-groups, one of which was ‘Lalwani Group’. On perusal of documents pertaining to ‘Lalwani Group’ , it was observed by the AO that the assessee has sold immovable property situated at village, Khadipur, Delhi to ‘M/s Wisdom Farm Pvt. Ltd.’ during the financial year 2013-14. The share of the assessee was 1/8^th as per the sale deed. It was observed by the AO that the assessee has sold immovable property at Khadipur, New Delhi to ‘M/s Wisdom Farm Pvt. Ltd.’, for Rs. 5,20,00,000/- , during the financial year 2013-14, wherein sale deed is registered on 23.04.2013 with Sub-Registrar, Delhi . The assessee on its part claimed that it had purchased agricultural land in January/March , 2006 , totaling 72 Bighas 19 Biswas (details at page 4 of the assessment order , situated at Vilalge Garhi , Village Mukhmelpur as well Village Kadipur all situated in Delhi-110036) . Thereafter, the collaboration agreement was signed with ‘Intime Promoters Pvt Limited’ (now known as TDI Infrastructure Ltd.) , on 20^th March, 2006. As per this agreement, the assessee will get from developer, refundable interest free security of Rs. 3,56,75,333/- and the owner is entitled for 10% of revenue , while 90% will devolve upon developer. Further , it was claimed by the assessee that the project never started till 31^st March, 2012 , and on 30.04.2012, the assessee entered into agreement to sell with M/s TDI Infrastructure Ltd. for consideration of Rs. 3,56,75,333/- . The assessee further stated that TDI Infrastructure Ltd. sold land measuring 46 Bighas at village Khadipur, Delhi-36 on 23.04.2013 to M/s Wisdom Farm Pvt. Ltd. , for Rs. 5,20,00,000/- The AO rejected the contentions of the assessee as the assessee has sold land to M/s Wisdom Farm Pvt. Ltd. for consideration of Rs. 5,20,00,000/- which is sold vide registered sale deed dated 23.04.2013 , registered at Sub-Registrar Office, Delhi, and there is no mention of the any third party in the sale deed. The details are recorded in the reassessment order at page 3-4. This led AO to bring to tax income comprising of Long term capital gains to the tune of Rs. 1,15,72,650/- with respect of sale of the aforesaid property in the hands of the assessee, vide assessment order dated 23.05.2023 passed by the AO u/s 147 read with Section 144B of the 1961 Act.

Aggrieved, the assessee filed first appeal with the ld. CIT(A). Similar contentions were made by the assessee before the ld. CIT(A), as were earlier made before the ld. AO . The copies of relevant agreements were enclosed by the assessee before ld. CIT(A). It was submitted by the assessee before ld. CIT(A) that the AO has completely overlooked the explanations given by the assessee , and the AO has wrongly brought to tax long term capital gains in the hands of the assessee , vide reply dated 8^th October, 2025 filed by the assessee with ld. CIT(A) which reply of the assessee is reproduced by ld. CIT(A) at page 5 to 7 of its appellate order . The assessee in its grounds of appeal filed before ld. CIT(A) also contended that said transaction has already suffered taxation in the hands of ‘M/s TDI Infrastructure Limited’. It was also stated in grounds of appeal that the assessee signed the sale deed dated 23.04.2013 as per its obligation to sign vide agreement to sell dated 30.04.2012 entered into with ‘M/s TDI Infrastructure Limited’. The assessee while submitting aforesaid reply dated 08.10.2025, prayed before ld. CIT(A) to adjourn the matter for 10 days as certain more documents were required to be filed by the assessee before ld. CIT(A) . But, instead of granting adjournment, the ld. CIT(A) dismissed the appeal of the assessee without granting any further opportunity to the assessee vide appellate order dated 13^th November, 2025, by holding that the assessee failed to bring any further evidences to substantiate its assertions and that the assessee has not shown this transaction in its return of income.

Still aggrieved, the assesse has filed second appeal with the Tribunal. At the outset, the ld. counsel for the assessee Shri Tarandeep Singh, Advocate submitted before the Bench that the assessee filed submissions before ld. CIT(A) on 8^th October, 2025 , wherein request was made that the assessee want to file further documents in support of its contentions , which is emanating from the order of the ld. CIT(A) itself wherein reply dated 08.10.2025 filed by the assessee is reproduced by ld. CIT(A) at page 5 to 7 of the appellate order. It was submitted that ld. CIT(A) did not give proper opportunity of hearing to the assessee , and has instead dismissed the appeal of the assessee. It was submitted that grave prejudice has been caused to the assessee by dismissal of the assessee’s appeal by ld. CIT(A). Prayers was made to set aside the appellate order passed by ld. CIT(A), and restore the matter back to the file of ld. CIT(A) for donovo adjudication of the appeal of the assessee. The ld. Counsel for the assessee Shri Tarandeep Singh, Advocate stated before the Bench that if the matter is restored back to the file of ld. CIT(A) for fresh adjudication , the assessee will co-operate with ld. CIT(A) and submit all required and necessary details/evidences to substantiate its assertion. The assessee has filed a paper book containing 41 pages before the Tribunal, which is placed on record in file, which paper book, inter-alia ,contains copies of afore-stated agreements entered into by the assessee. One copy of said paper book was handed over to ld. Sr. DR by the assessee.

We have heard rival parties and perused the material on record. Brief facts and contentions of both the parties are enumerated above and are not repeated. We are of the considered view that in the interest of justice and fairness to both the parties, one more opportunity needs to be given to the assessee , and hence we are setting aside the appellate order passed by ld. CIT(A) and restoring the matter back to the file of the ld. CIT(A) for donovo adjudication of the assessee’s appeal , after granting proper opportunity of being heard in accordance with principles of natural justice. We clarify that we have not commented on merits of the issues arising in the appeal, and ld. CIT(A) shall pass an order on merits in accordance with law uninfluenced with any of the observations in this order. Thus, the appellate order passed by ld. CIT(A) is set aside and matter is restored back to the file of ld. CIT(A) for fresh adjudication on merits in accordance with law. The ld. CIT(A) shall admit all the documents/evidences/contentions filed by the assessee in its support, and shall be adjudicated on merits in accordance with law by ld. CIT(A) by passing an order in compliance with provisions of Section 250(6) of the 1961 Act(Now Section 359(4) of the Income-tax Act, 2025). The appeal of the assessee is allowed for statistical purposes. We order accordingly.

In the result, the appeal filed by the assessee is allowed for statistical purposes.