Write short notes on any two of the following:(i) Deemed Owner of House Property(ii) Deemed Seizure(iii) Appeal before Appellate Authority(iv) Belated and Revised Return.”

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⭐ QUESTION 8

“Write short notes on any two of the following:
(i) Deemed Owner of House Property
(ii) Deemed Seizure
(iii) Appeal before Appellate Authority
(iv) Belated and Revised Return.”

I am giving detailed notes on all four topics, so you can choose any two in exam.

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⭐ (i) DEEMED OWNER OF HOUSE PROPERTY

(Section 27, read with Section 22 of Income Tax Act)

Under the Income Tax Act, ownership of house property is not limited to the person whose name appears in the title deed.
Certain persons are treated as “Deemed Owners” even though they may not be the actual legal owner of the property.

This is to prevent tax evasion, ensure correct taxation, and avoid benami transactions.

Persons Treated as Deemed Owners (Sec. 27):

1. Transfer to spouse (other than for adequate consideration)

If a husband transfers property to wife without proper consideration, the husband remains the deemed owner.

2. Transfer to minor child

Except for a child who is minor daughter married, transferor is deemed owner.

3. Holder of impartible estate

The holder is the deemed owner and taxed for entire property.

4. Property transferred under Section 53A of the Transfer of Property Act

If possession is given and part consideration is paid, buyer becomes deemed owner, even without registered deed.

5. Member of co-operative society

A person allotted flat/house by a company or society is treated as deemed owner.

6. Person in possession after lease for 12 years or more

Lessee becomes deemed owner (except for monthly rent tenancy).

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⭐ Important Case Laws

1. Mysore Minerals Ltd. v. CIT (1999, SC)

Held:
Ownership includes possession + right to enjoy the property, not only legal title.

2. CIT v. Podar Cement Pvt. Ltd. (1997, SC)

Buyer in possession under Section 53A is deemed owner for income tax purposes.

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⭐ (ii) DEEMED SEIZURE

(Under Search and Seizure Provisions – Section 132)

Deemed seizure refers to cases where the Department cannot physically seize property, but it is treated as seized by law.

This prevents the assessee from transferring or disposing of such property.

⭐ When Physical Seizure is Not Possible:

1. When assets are extremely bulky

Example:
Huge machinery, large furniture, or items difficult to transport.

2. When assets are perishable

Example:
Vegetables, fruits, or items likely to deteriorate.

3. When the property is immovable

Example:
Land, building, factory.

In such cases, AO issues an order of deemed seizure under Section 132(1)(iii).

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⭐ How Deemed Seizure Works:

1. AO tags, marks or seals the property.
2. Assessee is prohibited from removing or transferring it.
3. A written prohibitory order is issued.
4. Violation may result in penalties or prosecution.

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⭐ Case Law

CIT v. Tarsem Kumar (1986, SC)

Held:
When physical seizure is not possible, prohibitory orders are valid and treated as deemed seizure.

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⭐ (iii) APPEAL BEFORE APPELLATE AUTHORITY

Appeal is a statutory right under the Income Tax Act to ensure fairness and justice.

⭐ First Appellate Authority – CIT (Appeals)

(Section 246A, 250)

Any assessee aggrieved by AO’s order may file an appeal before the Commissioner of Income Tax (Appeals).

Orders Appealable:

• Assessment order (143(3), 144)
• Reassessment order (147/148)
• Penalty orders
• TDS defaults
• Rectification orders

⭐ Procedure:

1. File Form 35
2. Pay prescribed fees
3. Submit statement of facts + grounds of appeal
4. CIT(A) hears both sides
5. Order passed under Section 250(6) must be:
   • speaking order
   • with reasons
   • binding unless reversed by higher authority

⭐ Powers of CIT(A): (Sec. 251)

• Confirm the order
• Reduce assessment
• Enhance assessment
• Annul assessment
• Delete penalties

⭐ Case Law

CIT v. Kanpur Coal Syndicate (1964, SC)

Held:
Appellate Authority has full powers equal to AO and can do what AO ought to have done.

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⭐ (iv) BELATED AND REVISED RETURN

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⭐ 1. Belated Return (Section 139(4))

If the assessee fails to file the return within due date, he can file a belated return.

⭐ Time limit:

Belated return can be filed before 31st December of the assessment year or before completion of assessment — whichever is earlier.

⭐ Consequences:

• Interest u/s 234A
• Late fee u/s 234F
• Losses (except house property loss) cannot be carried forward

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⭐ 2. Revised Return (Section 139(5))

If the assessee discovers:

• any mistake,
• wrong statement,
• incorrect income reporting,

he may file a revised return.

⭐ Time limit:

Revised return can be filed before 31st December of the assessment year or completion of assessment.

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⭐ Case Law

Dhampur Sugar Mills Ltd. v. CIT (1973, SC)

Mistakes can be corrected by filing a revised return if filed within specified time.

CIT v. Jagannath (1995)

Revised return cannot be used to declare income that was deliberately concealed earlier.

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⭐ CONCLUSION

These four topics deal with important procedural and substantive aspects of the Income Tax Act:

• Deemed ownership ensures correct taxation.
• Deemed seizure ensures no asset is hidden during search.
• Appeals ensure fairness and taxpayer rights.
• Belated and revised returns provide flexibility to correct mistakes.