" 1 आयकर अपीलीय अधिकरण, बेंगलुरू पीठ ें, बेंगलुरू INCOME TAX APPELLATE TRIBUNAL, BANGALORE BENCHES, BANGALORE BENCH: B BEFORE SHRI PRASHANT MAHARISHI, VICE PRESIDENT AND SHRI SOUNDRARAJAN K., JUDICIAL MEMBER ITA No. 674/Bang/2026 (निर्धारण वर्ा/Assessment Year: 2015-16) RAVI BORAIAH NO.452, 9TH MAIN, NEAR KALIKAMBA TEMPLE, AVALAHALLI BDA, BANASHANKARI 3RD STAGE, BENGALURU-560085, KARNATAKA Vs. INCOME TAX OFFICER WARD 3(3)(1), HMT BUILDING, BENGALURU-560032, KARNATAKA अपीलधर्थी Appellant प्रत्यर्थी Respondent Permanent Account Number of Assessee: AIRPB1984B अपीलधर्थी द्वारा/Appellant represented by: Sri. Sanjay B Chikkamath - CA प्रत्यर्थी द्वारा/Respondent represented by: Sri. Pradeep S - Addl. CIT सुनवाई की तारीख / Date of conclusion of hearing: 20-Jul-2026 घोषणा की तारीख / Date of pronouncement: 28-Sep-2026 आदेश / ORDER PER SHRI PRASHANT MAHARISHI, VICE PRESIDENT 1. This appeal, relating to assessment year 2015–16, filed by Borahia Ravi [ the Assessee/ Appellant] is directed against the appellate order dated 18 December 2025 passed by the National Faceless Appeal Centre, Delhi (the learned CIT(A)). By that order, the assessee’s appeal against the reassessment order dated 24 February 2023, passed by the Income Tax Assessment Unit under section 147 read with sections 144 and 144B of the Income-tax Act, 1961 (the Act), was dismissed for non-prosecution. Printed from counselvise.com ITA 674/BANG/2026 RAVI BORAIAH 2 2. The Assessee has raised the following grounds of appeal: 1. The order passed by the learned Commissioner of Income tax (Appeals) under section 250 of the Income tax Act, 1961 confirming the assessment order passed under section 147 read with sections 144 and 144B is bad in law and on facts and liable to be quashed. 2. The learned authorities below erred in treating the entire sale consideration of Rs.58,00,000 as income of the Appellant, without appreciating that the Appellant had entered into a registered Joint Venture Agreement providing for 50 and 50 sharing of sale proceeds. 3. The learned Assessing Officer failed to appreciate that only 50 percent of the sale consideration accrued to the Appellant and the remaining portion belonged to the builder under the Joint Venture arrangement and therefore the addition of the entire amount is arbitrary and unsustainable. 4. The learned authorities failed to appreciate the principle of diversion of income by overriding title and erred in taxing income that never accrued to the Appellant. 5. The learned Assessing Officer erred in not allowing cost of construction and OR improvement while computing the capital gains, resulting in excessive and incorrect computation of income. 6. The learned Commissioner of Income tax Appeals erred in dismissing the appeal without adjudicating the grounds on merits and without granting reasonable opportunity of being heard. 7. The initiation of penalty proceedings under section 271(1)(c) 270A (as applicable) is premature, unjustified and unsustainable in law. 8. The Appellant craves leave to add, alter, amend OR withdraw any of the above grounds at the time of hearing. Printed from counselvise.com ITA 674/BANG/2026 RAVI BORAIAH 3 3. Briefly, the assessee did not file a return of income for assessment year 2015–16. Upon receiving information that the assessee had sold immovable property during the year without offering the resulting capital gains to tax, the case was reopened by issuing notice under section 147 of the Income-tax Act after an order was passed under section 148A(d). The assessee did not comply, failed to file a return in response to the notice under section 148, and disregarded seven notices. Consequently, the learned Assessing Officer passed an order under section 144 on 24 February 2023, adding long-term capital gains of ₹5,719,021 and determining the total income at the same amount. 4. The assessee challenged the order before the learned CIT(A), who dismissed the appeal for non-prosecution after the assessee failed to comply with three notices. 5. We heard Shri Sanjay B Chikamath, Chartered Accountant, for the assessee, and Shri Pradeep S, SR DR learned Additional Commissioner of Income Tax for the Revenue. 6. We find that the assessee did not appear before either the learned Assessing Officer or the learned CIT(A), who therefore dismissed the appeal for non-prosecution. Before the learned CIT(A), however, the assessee submitted in statement of facts that he had entered into a joint venture agreement with two other parties to develop a site. Under the agreement, the appellant contributed the land for constructing a three-storeyed building at J.P. Nagar, Bangalore, while the other parties agreed to fund the construction; the sale proceeds were to be shared equally. The assessee stated that, before the learned AO, in partial response to the notice dated 13 October 2022, he had furnished the sale deed, purchase deed, and bank statement for the relevant year and sought additional time to submit further documents. According to the assessee, the joint-venture property was sold for ₹58 lakh, of which ₹29 lakh was transferred to the other parties under the joint development agreement. Thus, only ₹29 lakh accrued to the appellant. The assessee further stated that the land was purchased in 2006 for ₹39,303 and that approximately ₹3 lakh was spent on improvements. Although these details were available to the learned Assessing Officer, the learned Assessing Officer made an addition of ₹59 lakh, and the learned CIT(A) did not consider the information. Printed from counselvise.com ITA 674/BANG/2026 RAVI BORAIAH 4 7. The learned authorised representative acknowledged the assessee’s non-appearance before the learned CIT(A) but referred to Form No. 35 and submitted that the assessee had not consented to receive notices by email. Notices issued by email would therefore be inconsistent with the particulars stated in that form. 8. On perusal of the above facts and the orders of the lower authorities, it is clear that the assessee was not afforded a proper opportunity of hearing before either the learned Assessing Officer or the learned CIT(A). 9. The learned CIT(A) could not dismiss the appeal for non-prosecution, as section 251 of the Act requires the appeal to be decided on its merits even in the assessee’s absence. The order of the learned CIT(A) is therefore unsustainable. Further, because the assessee was also denied an adequate opportunity before the learned Assessing Officer, remanding the matter to the learned CIT(A) would serve no useful purpose. 10. Accordingly, in the interest of justice and with the consent of both parties, we restore the entire matter to the file of the learned Assessing Officer. The assessee shall substantiate, with all relevant evidence, the taxability and the quantum of the capital gains. The learned Assessing Officer shall verify and examine the details and decide the matter afresh in accordance with law. 11. In the result, the assessee’s appeal is allowed for statistical purposes. Order pronounced in the open court on 28th September, 2026. Sd/- SOUNDRARAJAN K. JUDICIAL MEMBER Sd/- PRASHANT MAHARISHI VICE PRESIDENT Bangalore Dated: 28.09.2026 *TNTS* Printed from counselvise.com ITA 674/BANG/2026 RAVI BORAIAH 5 Copy to: 1 RAVI BORAIAH, NO.452, 9TH MAIN, NEAR KALIKAMBA TEMPLE, AVALAHALLI BDA, BANASHANKARI 3RD STAGE, BENGALURU-560085, KARNATAKA 2 INCOME TAX OFFICER, HMT BUILDING, BENGALURU-560032, KARNATAKA 3 THE PCIT / CIT, 4 THE CIT(APPEALS) 5 THE D.R., ITAT, BANGALORE BENCH BY ORDER ASSISTANT REGISTRAR I.T.A.T., BANGALORE Printed from counselvise.com "