Short Term Capital Gain on Sale of Factory Premises

Last updated: 17 September 2021

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The Income Tax Appellate Tribunal allowed the assessee's appeal for statistical purposes. The tribunal found that the Commissioner of Income Tax (Appeals) had made a decision without giving the assessee a proper opportunity to be heard. Consequently, the case was sent back to the CIT(A) to be reconsidered and decided afresh after ensuring the assessee is given a fair hearing.

Court :
ITAT Mumbai

Brief :
The assessee has filed the present appeal against the order dated 04.10.2019 passed by the Commissioner of Income Tax (Appeals)-40, Mumbai (hereinafter referred to as the “CIT(A)”) relevant to the A.Y.2011-12.

Citation :
I.T.A. No.391/Mum/2020

IN THE INCOME TAX APPELLATE TRIBUNAL “F” BENCH, MUMBAI
BEFORE SHRI AMARJIT SINGH, JM AND SHRI MANOJ KUMAR AGGARWAL, AM

I.T.A. No.391/Mum/2020

Assessment Year: 2011-12

M/s. Jai Rama Plastics B/402, Vardhman Nagar, Dr. R. P. Road, Mulund, (W), Mumbai-400080.

ITO-23(2)(3) C-10, 2nd Floor, Room No.204, Pratyakshakar Bhawan, Bandra Kurla Complex, Bandra (E), Mumbai-400051.

Assessee by: Shri Pradip Kapasi (AR)
Revenue by: Ms. Usha Gaikwad (DR)

Date of Hearing: 22/07/2021

Date of Pronouncement: 03/09/2021

O R D E R

1. We have heard the arguments advanced by the Ld. Representative of the parties and perused the record. In fact, the Ld. Representative of the assessee did not argue the case on merits but argued on this point that the CIT(A) has decided the matter of controversy in absence of the assessee and without giving an opportunity of being heard to the assessee in accordance with law, therefore, the finding of the CIT(A) is not justifiable, hence, is liable to be set aside in the interest of justice. However, on the other hand, the Ld. Representative of the Department has refuted the said contention. On appraisal of the order of the CIT(A) dated 04.10.2019 passed by the CIT(A), we find that the CIT(A) has decided the matter of controversy in absence of the assessee/Representative of the assessee without giving an opportunity of being heard to the assessee in the accordance with law. A proper and reasonable opportunity is required to be given to the assessee before the deciding the matter of controversy in accordance with law.

2. Accordingly in the interest of justice, we remit the issue raised in the appeal to the file of the Ld. CIT(A). Ld. CIT(A) is directed to consider the issue afresh and pass an order on the merits of the case after giving after giving a proper opportunity of being heard to the assessee in accordance with law. Therefore, in the said circumstances, we are of the view that the order of the CIT(A) is not liable to be sustainable in the eyes of law, therefore, we set aside the finding of the CIT(A) on all the issues and restore the matter before the CIT(A) to decide the matter afresh by giving an opportunity of being heard to the assessee in accordance with law.

3. In the result, the appeal filed by the assessee is hereby allowed for statistical purposes. Order pronounced in the open court on 03/09/2021.

Please find attached the enclosed file for the full judgement

FAQ :

The appeal concerned a decision made by the CIT(A) regarding short-term capital gains on the sale of factory premises, which the assessee argued was decided without a proper hearing.

The Income Tax Appellate Tribunal allowed the assessee's appeal for statistical purposes.

The Tribunal found that the CIT(A) had made a decision in the absence of the assessee and without providing an adequate opportunity to be heard, which is contrary to the principles of natural justice.

The Tribunal set aside the CIT(A)'s order and remitted the issue back to the CIT(A) to be decided afresh after giving the assessee a proper opportunity of being heard.