Wife Wins Tax Case after years of legal trouble over a disputed property purchase. Mrs. Chatterjee faced a tax demand because her name appeared as co-owner of a flat her husband had purchased. The Delhi Income Tax Appellate Tribunal (ITAT) ruled in her favor and ended the dispute.
On April 30, 2010, Mr. Chatterjee sold his Delhi-NCR house for Rs 60 lakh. He reported this income in his ITR and claimed an exemption under Section 54. The tax department accepted his return. Later, he bought a flat in Kolkata for Rs 59,13,680 and added his wife’s name as co-owner, even though he paid the full amount.
Trouble began when the property sub-registrar informed the tax department that Mrs. Chatterjee had purchased property worth Rs 70,46,028 without filing an ITR. The department sent her notices under Section 133(6) and Section 148. In 2018, officials added Rs 70 lakh to her income, calling it an unexplained investment.
She appealed to the Commissioner of Appeals, but the authority rejected her plea in December 2024. Refusing to give up, she approached ITAT Delhi. On May 30, 2025, judicial member Madhumita Roy and accountant member Manish Agarwal ruled in her favor. They noted that her husband had already declared the investment in his ITR and she had not made any payment.
The tribunal clarified that co-ownership does not create tax liability when one spouse alone funds the purchase. It said the Rs 70,46,028 addition to her income was wrong because her role was only on paper.
The ruling has wider meaning for joint property owners. It stresses the need to file ITRs correctly and confirms that spouses are not automatically liable if they do not contribute to the investment. For couples in Mohali, Chandigarh, and other parts of Punjab, this judgment offers clear guidance.
With property prices rising in Punjab and more non-resident Indians investing, tax compliance matters more than ever. Families choosing joint ownership must disclose their finances carefully to avoid disputes.
Ultimately, “Wife Wins Tax Case” demonstrates how accurate tax filing can protect individuals from unfair penalties. It also reminds homeowners to stay cautious and compliant while purchasing property.
