Amtula Tasneen Heera Banu Vs ITO (ITAT Chennai)
54F Claim Rejected on Technicalities – Best-Judgment Addition of ₹3.10 Cr u/s 69A Set Aside; Matter Remanded—Penalty u/s 271AAC Also Cancelled
Assessee, a 70-year-old senior citizen, sold property for ₹3.10 Cr (TDS ₹3,10,000) in AY 2018-19 but did not file ROI, stating that entire sale consideration was re-invested in new residential property of ₹3.07 Cr, making her eligible for exemption u/s 54F. AO issued notice u/s 148 (30.03.2022) & finding no response, completed best-judgment assessment u/s 144 r.w.s.147, treating full ₹3.10 Cr as unexplained money u/s 69A & taxing it u/s 115BBE. Demand raised: ₹3.66 Cr.
Before CIT(A), Assessee produced Sale Deed, Purchase Deed, bank statements & computation claiming s.54F exemption. CIT(A) refused to consider documents on hyper-technical grounds—no Rule 46A application, no certified copies, no affidavit—without giving opportunity to cure defects. CIT(A) also confirmed penalty u/s 271AAC(1).
Tribunal noted that natural justice was violated:
- Notices were sent to an email of a firm dissolved in 2015.
- CIT(A) mechanically rejected crucial evidence instead of allowing proper filing.
- Penalty was passed on the very day reply was due (23.05.2025).
Relying on TIN Box Co. (SC, 249 ITR 216), Tribunal held that when proper opportunity is lacking, entire matter must be restored.
