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Judgment
PER SANJAY AWASTHI, ACCOUNTANT MEMBER:
This appeal arises from order dated 28.04.2026, passed u/s 250 of the Income Tax Act, 1961 (hereafter as “the Act”), by NFAC.
In this case, the Ld.AO was in possession of information that the assessee had undertaken transactions in immovable property. Since no return of income was filed the case was reopened through issuance of notice u/s 148 dated 19.03.2022. The assessee made some submissions but the same were not found to be adequate by the Ld.AO and thereafter income from capital gains was assessed at Rs.67,44,600/-.
The assessee approached the CIT(A) where he vehemently contended that the transaction shown against his name was denied altogether and it was not possible to prove the “negative”. It was also averred before the Ld. CIT(A) that there was no liability to any capital gains. However, the Ld. CIT(A) affirmed the order of Ld. AO.
The assessee has now approached the ITAT with the following grounds as under: -
1.“That having regard to the facts and circumstances of the case, the Ld. CIT(A) has erred in law and on facts in confirming the action of Ld. AO in framing the impugned reassessment order u/s 144B and that too without assuming jurisdiction as per law and without complying with the mandatory conditions u/s 147 to 151 as envisaged under the Income Tax Act, 1961;
2.That having regard to the facts and circumstances of the case, the Ld. CIT(A) has erred in law and on facts in confirming the action of Ld. AO of addition of Rs.67,47,600/- on assumption of sale of land to Suncity Infrastructure Pvt. Ltd. when the appellant denied such sale that too without bringing on record any evidence of such sale and by recording incorrect facts and findings and without observing the principles of natural justice;
3.That in any case and in any view of the matter, action of Ld. CIT(A) in confirming the action of Ld. AO in making addition of Rs.67,47,600/- is bad in law and against the facts and circumstances of the case;
4.That the appellant craves the leave to add, modify, amend or delete any of the grounds of appeal at the time of hearing and all the above grounds are without prejudice to each other.”
Before us the Ld. AR argued on ground no. 2 and stated that the assessee had all along denied the transaction and there was no way that he could prove that he had not done any transaction of the kind alleged. The Ld. AR vehemently argued that neither of the authorities below had conducted any worthwhile enquiry to conclusively establish whether or not the capital gains was accruing to the assessee. The Ld. AR again repeated the contention that the transaction was not of the assessee and therefore there should be no capital gains liability.
The Ld. DR relied on the orders of the authorities below.
We have considered the submissions and have gone through the records before us. We find that this is a peculiar case where a transaction is denied but the authorities below doggedly relied on the Form 26AS and did not heed the assessee’s contention that the transaction was not dealing with him. In the event of such action by the Ld. AO, we are not inclined to support this action and direct that the addition made may be deleted.
However, before parting with this issue, we may direct the Ld. AO, who will, at the time of giving effect to this order, verify the exact provenance of the data in Form 26AS and thereby in case it is indeed the assessee’s transaction then the Revenue is at liberty to move for an appropriate Miscellaneous Application.
In the result, the appeal of the assessee is allowed.