Late Ragi Rajesham Vs ITO (ITAT Hyderabad)
The appeal was filed against the order dated 06.01.2025 passed by the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, for the assessment year 2013–2014.
At the outset, there was a delay of 56 days in filing the appeal. The assessee, represented by legal heirs, sought condonation of delay citing circumstances such as the death of the original assessee due to cancer, serious illness within the family, internal disputes among legal heirs, and the advanced age and illiteracy of the widow. The Tribunal found that the delay was caused by reasonable circumstances beyond control and condoned the delay in the interest of justice.
On merits, the case involved reassessment proceedings initiated under section 148 to tax alleged capital gains arising from a Development Agreement-cum-Power of Attorney (JDA) dated 04.03.2013. The assessee contended that the property was ancestral and belonged to a Hindu Undivided Family (HUF), and therefore any capital gains should not be assessed in the hands of the individual. It was further argued that the JDA did not result in transfer of property as per section 2(47)(v), since only a license was granted to the developer for construction.
The Revenue, however, argued that the Development Agreement was executed by individuals in their personal capacity and not by the HUF. It was also contended that possession was handed over and consideration was received, thereby constituting a transfer of immovable property liable to capital gains tax.
