Sheel Aggarwal vs Income Tax Officer

PER RAMIT KOCHAR, AM:

This appeal in ITA No. 2487/Del/2026 for Assessment Year: 2012-13 has arisen form the learned CIT(A)’s appellate order u/s 250 of the Income-tax Act, 1961 , dated 06.03.2026 in DIN & Order No: ITBA/NFAC/S/250/2025-26/1086953988(1), which appeal in turn has arisen from the assessment order dated 08.02.2019 passed by the Assessing Officer-ITO (OSD)-2, Faridabad u/s 144 r.w.s.147 of the 1961 Act.

Brief facts of the case are that the AO received AIR information that the assessee has purchased immovable property amounting to Rs.30,96,000/- during the financial year 2011-12. Notice u/s 133(6) was issued by the AO to the assessee, but there was no compliance by the assessee to the aforesaid notice. Thus, as per the AO , source of aforesaid investment remained unexplained. The assessee has not filed return of income u/s 139 of the 1961 Act. Proceedings for reopening of the assessment were initiated by the AO u/s 147 after recording reasons and getting approval from ld. PCIT, Faridabad. Notice u/s 148, dated 26.03.2019 was issued by the AO, but no return of income was filed by the assessee pursuant thereof to aforesaid notice u/s 148 nor any reply was received. Further notices u/s 142(1) was issued by the AO from time to time during the course of reassessment proceedings, but there was no response/reply by the assessee. SCN was also issued by the AO, but there was no response by the assessee to SCN. The AO proceeded to frame best judgment assessment u/s 144 r.w.s. 147 against the assessee, wherein addition to the tune of Rs.30,96,000/- was made by the AO to the income of the assessee from undisclosed sources, as the assessee filed to explain the source of making investment in the purchase of immovable property amounting to Rs.30,96,000/-.

Aggrieved , the assessee filed first appeal before the Ld. CIT(A) , and the assessee explained the reason for non-compliance with the notices issued by the AO. The assessee explained that address in the notices issued by the AO was wrongly given as Type II, 13A, Lesiure Valley Apartment , Behind Community Centre, Sector 46, Faridabad, while correct address as per PAN data base is BG-2, Aditya Mega City, Vaibhav Khand, Indirapuram, Ghaziabad, U.P. It was submitted that the assessee became aware of the assessment being completed by the AO only on 10.05.2021. The assessment was framed ex-parte by the AO as best judgment assessment. It was submitted that the assessee is Senior Citizen lady, and she along with her husband had purchased a property being residential flat no. 108C, 1^st Floor, Tower No. 8, Maple Road, Gulmohar Greens, Mohan Nagar, Ghaziabad, U.P. , for Rs.24,09,500/. The circle rate of the said flat was Rs. 30,96,000/- . The stamp duty of Rs. 2,16,750/- was paid on circle rate. It was submitted that her husband was a retired pensioner from Air Force as Group Caption being Vashisht Sewa Medal awardee. It was submitted that the husband made entire payment for the said flat to the Builder, and no payments were made by the assessee. It was submitted that no payment was made towards this flat during the year under consideration. It was submitted that the proceedings were initiated by the AO u/s 147/148 against her husband also, but proceedings were later dropped by the AO. It was submitted that the aforesaid property was purchased from SVP Builders India Ltd. for Rs. 24,09,500/- in joint name of the assessee and her husband. The Circle Rate of the property was Rs.30,96,000/-. The sale deed was executed on 23.06.2011. The assessee did not file return of income u/s 139 nor filed return of income in pursuance to notice u/s 148. The assessee explained that her income was below taxable limits and hence there was no requirement for filing of return of income. The assessee filed additional evidences before the Ld. CIT(A) for the first time during appellate proceedings. The reassessment order passed by the AO was best judgment assessment u/s 144 read with Section 147. The ld. CIT(A) observed that these additional evidences are to be examined by the AO as the same were not submitted before the AO during reassessment proceedings .The Ld. CIT(A) after considering the reply of the assessee set aside the reassessment framed by the AO, and restored the matter back to the file of the AO for denovo reassessment , vide order date 06.03.2026.

Still Aggrieved the assessee filed second appeal with the Tribunal. The Ld. Counsel for the assessee raised various legal grounds as well as on the challenged the addition on merits ,

I have considered rival contentions and perused the materials available on record. I have observed that the assessee is Senior Citizen lady. The assessee has not filed return of income u/s 139. I have observed that the assessee has explained that the assessee was having no income during the year under consideration, hence there was no requirement to file return of income. I have observed that the assessee along with her husband has purchased immovable property being residential Flat No.108C, 1^st Floor, Tower No.8, Maple Road, Gulmohar Greens, Mohan Nagar, Ghaziabad. UP. The Circle Rate of the property was Rs.30,96,000/-. The sale deed was executed on 23.06.2011. Based on the AIR information that the assessee has purchased immovable property to the tune of Rs. 30,96,000/- , the case of the assessee was reopened by Revenue u/s 147/148 of the 1961 Act. Before reopening, the AO issued notice u/s 133(6) to the assessee , but there was no response from the assessee. Notices u/s 148, 142(1) and SCN were issued by the AO during reassessment proceedings, but neither the assessee filed return of income in response to notice u/s 148 nor any replies/response were filed by the assessee before the AO. The AO passed ex-parte Best Judgment assessment u/s 144 r.w.s. 147 of the Act, wherein Rs. 30,96,000/- was added to the income of the assessee from undisclosed sources as the assessee is not able to explain sources for making investment in immovable property to the tune of Rs. 30,96,000/-. The assessee filed appeal with ld. CIT(A) and explained that the AO sent notices to wrong address and not at the address available at PAN data base, hence no notices , assessment order were received by the assessee, and hence non compliances during reassessment proceedings. The assessee explained that the aforesaid property was purchased for Rs. 24,09,500/- while circle rate was Rs. 30,96,000/- . The assessee explained that the assessee did not made any payment for the said property , and all payments were made by her husband, who retired from Airforce and is Vashisht Seva Medal Awardee. The assessee explained that proceedings were started u/s 148 by the AO against the husband of the assessee, but later dropped by the AO. The assessee also explained before ld. CIT?(A) that in-fact no payments were made during the year under consideration towards said flat. I have observed that the assessee had filed additional evidences before ld. CIT(A). The said evidences need examination and verification by the AO. Since, assessee has filed the additional evidence before ld. CIT(A) for the first time and the best judgment assessment order was passed ex-parte by the AO u/s 144 of the Act , the Ld. CIT(A) rightly set aside assessment order, and restored the matter before the AO for denovo reassessment , by invoking provisions of section 251(1)(a) read with first proviso. I am of the view that the additional evidences filed by the assessee before the Ld. CIT(A) for the first time requires verification and examination. The assessee can raise all the contentions including challenge to legal/jurisdiction before AO as well as submit additional evidences before the AO , which the AO is directed to admit , and frame denovo reassessment in accordance with law. The assessee is also permitted to raise all legal/jurisdictional grounds before the AO , which the AO shall decide on merits in accordance with law. Thus, I confirm the appellate order passed by the ld. CIT(A). The appeal of the assessee is dismissed in the manner as indicated above. I order accordingly.

In the result, the appeal of the assessee is dismissed as indicated above.