Malkiat Singh Vs ITO (ITAT Delhi)
Half-share, half-truth – AO’s wrong assumption of ₹ 1 cr sale kills jurisdiction- escaped income below ₹ 50 lakh bars extended time under s. 149(1)(b)- Reassessment u/s 147 quashed as notice issued beyond 3-year limit –
Assessee challenged the order of NFAC dated 16.06.2025 upholding reassessment for A.Y. 2017-18. AO had issued notice u/s 148A(b) on 09.02.2024 alleging escapement of income based on information of sale of immovable property of ₹ 1.02 crore, purchase of property ₹ 32.20 lakh, & TDS receipts ₹ 79,200. Assessment was completed at income of ₹ 35.91 lakh, including ₹ 35.12 lakh short-term capital gains.
Assessee argued that:
- The escaped income was only ₹ 35.91 lakh-below ₹ 50 lakh, hence extended time under s. 149(1)(b) did not apply.
- Notice u/s 148A(b) issued on 09.02.2024 was time-barred, since for A.Y. 2017-18 the limitation of 3 years from 31.03.2018 expired on 31.03.2021.
- AO had wrongly assumed full sale consideration of ₹ 1.02 crore though the Assessee held only 50% share in the property (balance belonging to brother Bhupinder Singh).
- AO’s own assessment finally accepted the Assessee’s share at ₹ 35.12 lakh, confirming the error in reopening premise.
Department relied on lower-authority orders, arguing that Assessee had not filed return earlier & that the case involved property transactions warranting verification.
