Case Law Details
Mangalagiri Tulasi Vs ITO (ITAT Bangalore)
Introduction: The case of Mangalagiri Tulasi Vs ITO (ITAT Bangalore) revolves around the dispute regarding the taxation of long-term capital gains (LTCG) arising from the sale of a property. Despite the Civil Court canceling the sale of the property, the Income Tax Appellate Tribunal (ITAT) directed re-examination of the matter.
Detailed Analysis: The appellant raised concerns over the assessment completed under section 144 read with section 148 of the Income Tax Act, 1961, as well as the taxability of Rs. 1,01,39,166/- as LTCG from the sale of land for the Assessment Year 2012-13. However, the appeal was dismissed by the Commissioner of Income Tax (Appeals) [CIT(A)] without addressing the merits due to non-compliance with notices.
The appellant argued that they hadn’t received the notices issued by the CIT(A), suggesting they might have been lost in the spam folder. Additionally, they highlighted that the assessment was conducted under section 148 read with section 144, and they were unaware of the notices issued under section 148. On the merits, they contended that the sale of the property, which led to LTCG liability, was annulled by a Civil Court.
While the Departmental Representative (DR) supported the orders of the Assessing Officer (AO) and the CIT(A), the ITAT deemed it necessary to give the appellant an opportunity to prove that the property in question was not sold or that the sale was canceled by the Civil Court. Consequently, the matter was remanded back to the AO for re-examination, with instructions for the appellant to cooperate with the Revenue.
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