Rajeshri Omprakash Malviya Vs ITO (ITAT Ahmedabad)
The Income Tax Appellate Tribunal (ITAT) Ahmedabad addressed an appeal filed by Rajeshri Omprakash Malviya against the order passed by the Commissioner of Income Tax (Appeals) [CIT(A)] concerning the Assessment Year 2014-15. The primary grievance of the assessee, as outlined in the grounds of appeal, was the CIT(A)’s upholding of the Assessing Officer’s (AO) disallowance of an exemption claimed under Section 10(37) of the Income Tax Act, 1961, amounting to Rs. 1,27,21,724. This disallowance was linked to a Long Term Capital Gain (LTCG) arising from the sale of land, where the assessee had claimed exemption under Section 54G of the Act. Furthermore, the assessee contended that the CIT(A) failed to address the arguments presented and did not adjudicate on an application for the admission of additional evidence filed under Rule 46A of the Income Tax Rules.
During the assessment proceedings, the AO had selected the assessee’s case for limited scrutiny, specifically focusing on the large deduction claimed under various sections, including Section 54G. The AO noted the LTCG of Rs. 1,27,21,724 from the land sale and the corresponding exemption claim. Despite requests for details, the assessee reportedly did not provide the necessary information, leading the AO to disallow the exemption and add the capital gain to the assessee’s income. Subsequently, the CIT(A) dismissed the assessee’s appeal. However, before the ITAT, the assessee’s representative argued that the CIT(A) had erred by not considering the additional evidence submitted, which included a government notification and a certificate from the village Talati confirming the agricultural use of the land, along with the sale deed. The representative requested that the matter be sent back to the CIT(A) for proper verification of this evidence and a decision on the merits of the case. The ITAT, after hearing both sides and reviewing the material, noted that the CIT(A) had indeed not taken cognizance of the application for admitting additional evidence. Consequently, the Tribunal directed the CIT(A) to consider the submitted evidence, provide the assessee with an opportunity for a hearing in accordance with natural justice principles, and then adjudicate the contested issues. As a result, the assessee’s appeal was partly allowed for statistical purposes, effectively restoring the matter to the CIT(A) for reconsideration.
