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Judgment
PER VIKAS AWASTHY, JUDICIAL MEMBER:
This appeal by the assessee is directed against the order of Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi [in short 'the CIT(A)'] dated 19.11.2024, for Assessment Year 2012-13.
The appeal is time-barred by 485 days. The assessee has filed an application for condonation of delay supported by an affidavit. A perusal of the application reveals that the delay has been caused firstly on account of the death of the Counsel, Shri Kirpal Singh, Advocate, who was handling the case of the assessee before the First Appellate Authority. It is stated that the order of the CIT(A) was passed on 19.11.2024 and the Counsel for the assessee died on 20.11.2024. The assessee came to know about the impugned order only on 05.11.2025 when notice for recovery of outstanding demand for the impugned assessment year was received in the month of November, 2025. Immediately thereafter, the assessee contacted Chartered Accountant Shri Naman Gupta and handed over appeal papers to him on 12.11.2025. Shri Naman Gupta suffered grievous injuries on 15.11.2025. He was operated upon at Max Hospital, Shalimar Bagh, New Delhi on 17.11.2025. He remained confined to the bed for next four to five months. The appeal was eventually filed on 11.03.2026. Thus, there was delay of 485 days in filing the appeal. The assessee has also placed on record the death certificate of Shri Kirpal Singh, Advocate, and the treatment records and discharge summary of Shri Naman Gupta, Chartered Accountant. After examining the documents furnished by the assessee, I am satisfied that the delay in filing of the appeal is not on account of any inaction on the part of the assessee. The reasons explained for the delay appear to be bona fide. Hence, the delay of 485 days in filing the appeal is condoned and the appeal is admitted for hearing on merits.
Shri Naman Gupta appearing on behalf of the assessee submits that the assessee is 80 years old lady. Notice u/s. 148 of the Income Tax Act, 1961(hereinafter referred to as ‘the Act’) for AY 2012-13 was issued to the assessee on 22.03.2019. Notice u/s.148 of the Act was issued for the reason that the assessee had purchased an immovable residential property i.e. Plot No. 28, Block -B, Sector CHI-4, Greater NOIDA during the period relevant to assessment year under appeal. The AO wanted to examine source of investment in said property. In response to the notice issued u/s 142(1) of the Income Tax Act, 1961 (In short ‘the Act’), the assessee explained source of funds for purchase of said property, as sale of following two properties: Property No. 1 : Residential House No. 465, Block -C Alpha-1, Greater Noida for a consideration of Rs19,32,000/-.
Property No. 2 : Residential Plot No.23A, Block-B, ViII. Birondi, Chakrasainpur, Greater Noida for a consideration of Rs. 6,30,000/-. The second property was owned and sold by the husband of the assessee Sh. Baljeet Singh.
During assessment proceedings the assessee had furnished all the relevant documents including bank statements to substantiate her submissions. The AO after considering the documents and the submissions made by the assessee made no addition on the reasons for which notice u/s 148 of the Act was issued. The AO made addition in respect of some property situated at Village Mamura. The assessee does not own any property situated at Village Mamura. The assessee had filed an affidavit to this effect before the AO. A copy of the said affidavit is placed at page-35 of the paper book. The AO without considering the affidavit of the assessee and without bringing any documentary evidences on record to show that the property at Village Mamura was owned by the assessee, made addition of Rs.18,80,656/- alleging sale consideration from sale of property at Village Mamura as income of the assessee under the head ‘Income from Other Sources’.
Aggrieved, by the assessment order dated 26.12.2019, the assessee filed appeal before the ld. CIT(A). The ld. CIT(A) without application of mind in a mechanical manner dismissed appeal of the assessee. Hence, the present appeal.
The ld. Counsel asserted that since, the property in question at village Mamura does not belong to the assessee, the aforesaid addition is unsustainable. He further submitted that since no addition was made by the AO for which notice u/s 148 of the Act was issued, no other addition could have been made by the AO.
Per contra, Shri Manoj Kumar representing the Department vehemently supporting the impugned order prayed for dismissing appeal of the assessee. The ld. DR submitted that the addition has been made by the AO in respect of property sold by the assessee during the relevant period and no return of income for AY 2012-13 was filed by the assessee. Even in response to notice u/s 148 of the Act, no return was filed by the assessee.
Both sides heard, orders of the lower authorities examined. Admittedly, no return of income was filed by the assessee either u/s 139 of the Act or in response to notice u/s 148 of the Act. A perusal of the impugned order shows that notice u/s 148 of the Act was issued to the assessee to examine purchase of immovable property by the assessee for a total consideration of Rs.70,68,000/- plus stamp duty of Rs.3,53,400/-during Financial Year 2011-12. Though no return was filed by the assessee in reply to notice u/s.148 of the Act, however, in response to notice issued u/s 142(1) of the Act, the assessee explained the source of purchase of property situated at Plot No. 28, Block-B, Sector CHI-4, Greater Noida. The assessee explained that the funds for purchase of the property were sourced from the sale of Residential House No. 465, Block-C, Alpha-1, Greater Noida for Rs.19,32,000/- and sale of Residential Plot No. 23A, Block-B, Village Birondi, Chakrasenpur, Greater Noida by the husband of the assessee for a consideration of Rs.6,30,000/-. The AO, while completing the assessment u/s 147 of the Act, made no addition in respect of the issue for which notice u/s 148 of the Act was issued. Instead, the AO made an addition on account of alleged sale of property by the assessee. The AO computed Long Term Capital Gain (LTCG) in respect of sale of property at village Mamura for Rs.18,80,656/-. While concluding the assessment order, the AO made addition of Rs.18,80,656/- under the head “Income from Other Sources”. It is relevant to mention here that while computing LTCG, the AO referred to a property situated at Village Mamura. The ld. AR of the assessee vehemently asserted that the assessee does not own any immovable property in Village Mamura. The assessee had also filed an affidavit to this effect before the AO. Still, the AO recorded that the cost of acquisition of the property was taken on the basis of circle rates applicable to rural areas of Ghaziabad District as on 01.04.1981. He further recorded that since no rates were available in respect of Village Mamura, the rate of Rs.100 per sq. yard was adopted for working out the cost of acquisition. The assessment order is unsustainable and liable to be quashed for the following reasons:-
The addition has been made for a reason other than those for which notice u/s 148 of the Act was issued. It is not open to the AO to independently assessee some other income, without issuing fresh notice u/s.148 of the Act. This legal proposition is supported by the decision of the Hon’ble Bombay High Court in the case of CIT vs. Jet Airways (I) Ltd., 195 Taxman 117 (Bom.). Hence, the addition is unsustainable.
The AO computed LTCG in respect of sale of property situated at Village Mamura admeasuring 491 sq. yards, which was never owned by the assessee. No material has been referred to either by the AO or by the CIT(A) to contend that the property situated at Village Mamura was owned by the assessee, despite the affidavit sworn by the assessee denying ownership of any immovable property at Village Mamura.
Thus, in light of facts of the case, I find merit in appeal of the assessee, hence, the impugned order is set aside and appeal of the assessee is allowed.