M. Ramakrishna Reddy Vs ACIT (ITAT Hyderabad)
Summary: The Income Tax Appellate Tribunal (ITAT), Hyderabad Bench “A”, considered an appeal filed by M. Ramakrishna Reddy against the Assistant Commissioner of Income Tax, Circle-8(1), Hyderabad, for Assessment Year 2007-08. The appeal arose from the order dated 29 November 2016 passed by the Commissioner of Income Tax (Appeals)-2, Hyderabad, under Section 154 read with Section 250(6) of the Income-tax Act, 1961. The principal dispute concerned the denial of deductions claimed under Sections 54F and 54EC in respect of capital gains arising from the sale of immovable property. The assessee contended that the Assessing Officer and the Commissioner (Appeals) had wrongly denied the deductions. During the hearing, the assessee’s authorised representative submitted that the assessee was entitled to the deductions and requested one additional opportunity to present his case before the Assessing Officer. It was argued that refusal to grant another hearing would cause irreparable loss to the assessee. The Departmental Representative strongly opposed the request.
After considering the rival submissions and examining the available records, the ITAT acknowledged that the revenue authorities had already granted sufficient opportunities to the assessee. Nevertheless, considering the assessee’s precarious financial position and the interests of justice, the Tribunal decided to remit the entire matter to the Assessing Officer for de novo consideration. The Tribunal directed that the assessee be provided one further opportunity of being heard so that his claims under Sections 54F and 54EC could be reconsidered. However, the Tribunal also cautioned the assessee to cooperate promptly with the revenue authorities to ensure expeditious completion of the proceedings. It clarified that if the assessee failed to cooperate, the revenue authorities would be at liberty to pass appropriate orders in accordance with law and on the merits of the material available on record. Significantly, the ITAT did not adjudicate the substantive eligibility of the assessee for the claimed capital gains deductions. Instead, it restored the dispute to the Assessing Officer for fresh examination. Accordingly, the assessee’s appeal was allowed for statistical purposes, without granting the deductions outright.
FULL TEXT OF THE ORDER OF ITAT HYDERABAD
This appeal is filed by the assessee against the order of the Ld. CIT (A)-2, Hyderabad in appeal No. 0074/2014-15, dated 29/11/2016 passed U/s. 154 r.w.s 250(6) of the Act for the AY 2007-08.
2. The assessee has raised several grounds in his appeal however, the crux of the issues is that the :-
“The Ld. AO as well as the Ld. CIT (A) has erred in denying the claim of deduction U/s. 54F / 54EC of the Act to the assessee.”
3. At the outset, the Ld AR submitted before us that the assessee is entitled to the claim of deduction with respect to the capital gains earned by the assessee on sale of his immovable property. The Ld. AR further pleaded that one more opportunity may be granted to the assessee to argue his case before the Ld. AO otherwise, the assessee will be put to irreparable loss. The ld. DR vehemently opposed to the submissions of the Ld. AR.
4. We have heard the rival submissions and carefully perused the materials available on record. Thought the Ld. Revenue Authorities had granted sufficient opportunities to the assessee, considering the precarious financial position of the assessee, in the interest of justice, we hereby remit the entire matter back to the file of the Ld. AO for de novo consideration thereby providing the assessee with one more opportunity before the ld. AO of being heard. At the same breath, we also caution the assessee to promptly cooperate before the ld. Revenue Authorities in order to expedite their proceedings failing which the Ld. Revenue Authorities shall be at liberty to pass appropriate orders in accordance with law and merits based on the materials on record.
5. In the result, appeal of the assessee is allowed for statistical purposes as indicated herein above.
