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Dec 17, 2025
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Real estate broker's excel sheet triggers Rs 48 lakh cash payment' tax notice; homebuyer wins relief in ITAT Ahmedabad
On November 25, 2025, the Income Tax Appellate Tribunal (ITAT) Ahmedabad, held that if the source of funds from a property sale is clarified and qualifies for capital gains tax exemption, then the related tax exemptions under Section 54 and 54EC cannot be denied.
This judgement was announced in a case filed by Mr. Patel from Ahmedabad. During the Assessment Year 2019-20, Patel did not file any income tax return (ITR). Subsequently his case was flagged by the income tax department's risk management system on the basis of information indicating that he had entered into significant financial transactions exceeding taxable limits during the year.
The flagged information pointed to an alleged unaccounted cash investment in real estate totalling Rs 48.898 lakh. The income tax Assessing Officer noted that the evidence supporting this information was discovered during a search under Section 132 conducted on February 10, 2022, at certain real estate companies, and that the seized material included details about several individuals including Mr. Patel.
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