The Delhi bench of the Income Tax Appellate Tribunal (ITAT) has held that the Assessing Officer (AO) lacks jurisdiction to entertain fresh capital gains deduction claims raised solely through the Income Tax Return (ITR) without a revised return.
The taxpayer, Poonam Raghav, has submitted an appeal against the order passed by the Commissioner of Income Tax (Appeals) [CIT(A)]/National Faceless Appeal Centre (NFAC), Delhi, for Assessment Year (AY) 2016–17.
The dispute concerned the addition of ₹8.50 lakh as long-term capital gains (LTCG). The assessee argued that the amount received from Shri Rahul Arora formed part of the sale consideration for a residential property in Faridabad and had subsequently been invested in the purchase of new residential properties from the Omaxe Group.
Based on this, the assessee sought a deduction under Section 54 of the Income Tax Act and requested that the sale consideration be enhanced to ₹31 lakh.
The Assessing Officer (AO) rejected the claim, stating that the assessee had not claimed the deduction u/s 54 of the IT Act in the original income tax return.
According to the AO, the deduction was claimed for the first time in the return filed in response to a notice issued u/s 148, and therefore could not be entertained.
The CIT(A) upheld the AO’s measure, holding that the taxpayer could not claim a fresh deduction in the return submitted u/s 148 of the Income Tax Act after incorrect computation of the capital gains in the original return.
No one appeared on the taxpayer’s behalf; the departmental representative put reliance upon the findings and orders of the lower tax authorities.
The Tribunal of Madhumita Roy, Judicial Member and Krinwant Sahay, Accountant Member observed that, “The assessee is making a fresh claim during the course of assessment proceedings as the AO cannot consider the fresh claim of the assessee made in the return filed in response to notice under Section 47 of the Income Tax Act. Therefore, the assessee’s fresh claim in the return of income filed in response to Section 148 of the Income Tax Act cannot be considered.”
The Bench said that a detailed and reasoned order had been passed by the Commissioner of Income Tax (Appeals) [CIT(A)] that concluded that the taxpayer could not raise a fresh claim for deduction u/s 54 of the Income Tax Act in the return submitted u/s 148 after failing to make such a claim in the original return.
The tribunal did not find any infirmity in the CIT(A)’s reasoning, and it refused to interfere with the impugned order and dismissed the taxpayer’s appeal.
| Case Title | Poonam Raghav vs. ITO |
| Case No. | I.T.A. No.6643/DEL/2025 (A.Y. 2016-17) |
| Appellant by | None |
| Respondent by | Sh. Rajesh Kumar Dhanesta |
| Delhi ITAT | Read Order |
