IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES “A”, PUNE BEFORE DR.MANISH BORAD, ACCOUNTANT MEMBER AND MS. ASTHA CHANDRA, JUDICIAL MEMBER आयकर अपील स.ं / ITA No.953/PUN/2024 Assessment Year : 2018-19 Manjusha Anil Lodha, PCIT, Nashik-1 L/H of Late Anil Bansilal Lodha, Vs.

Mangal Bhavan, Opp Swami Vivekanand School, Panchvati, Nashik – 422 003 Maharashtra PAN : AAGPL1981M Appellant Respondent Appellant by : Shri Pramod S. Shingte Respondent by : Shri Amol Khairnar Date of hearing : 21.07.2025 Date of pronouncement : 10.10.2025 आदेश / ORDER PER DR. MANISH BORAD, ACCOUNTANT MEMBER : This appeal at the instance of Legal Heir of Assessee is against the order dated 21.03.2024 of the Principal Commissioner of Income tax, Nashik – 1 passed u/s.263 of the Income Tax Act, 1961 for A.Y.2018-19 emanating from Assessment Order dated 28.04.2021 passed u/s.143(3)

r.w.s.144B of the Act.

2. Assessee has raised following grounds of appeal :

“1. On the basis of the facts and circumstances of the case, the order passed u/s. 263 by the Principal Commissioner of Income-tax, Nashik may please be quashed.

2. On the basis of the facts and circumstances of the case and as per law, the Principal Commissioner of Income-tax is not justified in initiating the proceedings u/s. 263 of the Act under the premise that the appellant has earned income from Short term Capital gain and claimed exempt income u/s 10(38) of the Act, particularly when the appellant has claimed exemption w.r.t. long term capital gain on sale of shares.

3. On the basis of the facts and circumstances of the case and as per law, the Principal Commissioner of Income-tax is not justified in initiating the proceedings u/s 263 of the Act under the premise that the exemption u/s. 10(38) was withdrawn and the transaction of long term capital gain was to be taxed u/s. 112A of the Act, particularly when the exemption u/s. 10(38) was withdrawn from the next assessment year and the provisions of section 112A were inserted from next assessment year.

4. On the basis of the facts, in the circumstances of the case and as per law, the order passed by the Principal Commissioner of Income-tax u/s. 263 of the Act may please be quashed as the same is passed in respect of issues not arising out of the notice issued u/s.

263 of the Act.

5. On the basis of the facts and circumstances of the case, the Principal Commissioner of Income-tax is not justified in initiating revisionary proceedings u/s 263 of the Act on 05/06/2023 in the name of appellant who is deceased, especially when the legal heir was registered on the Income Tax portal on 22/10/2018. The Pr. CIT is further not justified in holding that the demise of the assessee has not brought to the notice of AO or in any other previous proceedings, particularly when the request for registration of legal heir was filed on Income-tax portal on 16/10/2018, which was approved by the competent authority on 22/10/2018 and more particularly when the appellant has furnished the compliances during the course of assessment proceedings as legal representative.

6. On the basis of the facts and circumstances of the case, the Principal Commissioner of Income-tax has erred in holding that the investment in shares of 'Indiabulls Whole Services Limited' does not form a part of investment of appellant as at 31.03.2017 whilst the appellant has clearly shown the said investment in his audited books of accounts. Therefore, the order passed u/s. 263 may please be cancelled.

7. On the basis of the facts and circumstances of the case, the Principal Commissioner of Income-tax has erred in holding that the appellant has not submitted contract notes or evidence in respect of shares of Indiabulls Whole Services Limited' being traded on recognised stock exchange, particularly when the appellant vide his submission dated 20/04/2021 during the course of assessment proceedings has submitted contract notes of purchase and sale of shares of the said company which clearly reflect that the said shares