Case Number ITA 878/DEL/2020, filed on February 21, 2020, features appellant Suresh Kumar of Kaithal, challenging the order of the Commissioner of Income Tax (Appeals), Karnal concerning the assessment year 2010-11. The final tribunal order was pronounced on October 28, 2022, by members Shri Shamim Yahya and Shri Challa Nagendra Prasad in Delhi Bench ‘G’ of the Income Tax Appellate Tribunal.
Suresh Kumar, a farmer, had entered into agreements to sell his land during the assessment year 2010-11 and received earnest money for these transactions. However, these agreements were later canceled, and the earnest money was returned within the same assessment year. Despite this, the income tax officer assessed the earnest money as income, leading to a tax demand significantly higher than the income reported by Kumar.
Kumar’s appeal highlighted several key issues: lack of proper notice for the hearing, the order passed without an opportunity for a hearing in violation of natural justice, incorrect address leading to non-service of notices, and the claim that his disclosed income was bona fide and nothing was concealed. The primary contention was that the returned earnest money could not be reasonably considered as income for tax purposes.
The tribunal noted the procedural flaws in the appeal handling by the CIT(A), particularly the dismissal of the appeal for non-prosecution without a speaking order, contrary to the mandates of Section 251 of the IT Act. The tribunal remanded the matter back to the CIT(A) for a fresh assessment after giving Kumar a reasonable opportunity to be heard.
The case of Suresh Kumar vs ITO, Ward-2, Kaithal underscores the critical importance of adhering to procedural justice and the rights of appellants in tax assessments. It highlights the need for thorough examination and consideration of evidence and submissions by tax authorities to ensure fair tax assessments.
Order pronounced in the open Court on 28/10/2022.
Legal Analysis of ITA 878/DEL/2020: Suresh Kumar vs ITO, Kaithal Over Assessment Year 2010-11
Manage the increasing number of hearings effortlessly by leveraging the legal AI revolution We are India's Leading revolutionary AI-powered legal platform where you can get enough insights into top cases and judgements.
Research Platform