Shivaramaiah Guruswamy Vs ITO (ITAT Bangalore)
Sale of Property ≠ Unexplained Money: Entire Sale Consideration Can’t Be 69A- Bangalore ITAT Remands Best Judgment Assessment
Bangalore ITAT “B” Bench, in Shri Shivaramaiah Guruswamy Vs ITO (ITA No. 2425/Bang/2024, AY 2018-19; order dated 31.01.2025), set aside the ex-parte assessment framed u/s 144 r.w.s. 147 & remanded the matter to AO for de-novo adjudication, subject to payment of cost of ₹5,000.
Assessee, a 69-year-old senior citizen, had sold an immovable property for ₹65 lakh & earned pension income of ₹2.71 lakh and minor interest income, but had not filed return of income. AO, noting non-compliance to notices issued electronically u/s 148A, 148 & 142(1), completed best judgment assessment & treated the entire sale consideration as unexplained money u/s 69A, even while acknowledging that the amount represented sale proceeds of property.
Tribunal observed that once AO himself accepts the receipt as sale consideration of immovable property, taxing the entire amount u/s 69A is legally unsustainable. However, considering repeated non-compliance, ITAT held that AO could not be faulted for invoking section 144. Balancing principles of natural justice, Tribunal granted Assessee one final opportunity, noting his lack of technological familiarity, and directed AO to issue notices to the new email ID of the auditor furnished in Form-36.
Accordingly, orders of AO & CIT(A) were set aside, matter was remanded for fresh assessment on merits, with a condition that Assessee pays ₹5,000 as cost, failing which appeal would stand dismissed. Appeal was allowed for statistical purposes.
FULL TEXT OF THE ORDER OF ITAT BANGALORE
