Sh Vikramaditya Singh, Jammu V. The Asstt. Commissioner of Wealth Tax, Jammu

CO 15/ASR/2015

• Counselvise Citation: [2015] 123 COUNSELVISE.COM (IT) 1092 (ITAT-AMRITSAR)
• Duration Of Justice: 3 month(s) 13 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 21-08-2015
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 12-06-2015
• Assessment Year: 2004-2005
• Appeal Filed On: 08-05-2015
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: P N ARORA
• Assessee Lawyers: VIRENDRA KUMAR SINGH
• Keywords: Retrospective amendment; Additional evidence

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR BEFORE SH. A.D.JAIN, HONBLE JUDICIAL MEMBER AND SH. T.R. MEENA HONBLE ACCOUNTANT MEMBER W .T.A. NOS. 15 &16 (ASR)/2014 ASSESSMENT YEAR S : 2004 - 05 & 2005 - 06 PAN: AZCPS4824P THE ASSISTANT COMMISSIONER OF WEALTH TAX, CIRCLE - 2, JAMMU VS. SH. VIKRAMADITYA SINGH, THE PALACE, JAMMU (APPELLANT) (RESPONDENT) CROSS OBJECTION NOS. 15 &16(ASR)/2015 ASSESSMENT YEARS: 2004 - 05 & 2005 - 06 PAN: AZCPS4824P SH. VIKRAMADITYA SINGH, THE PALACE, JAMMU VS. THE ASSISTANT COMMISSIONER OF WEALTH TAX, CIRCLE - 2, JAMMU (APPELLANT) (RESPONDENT) APPELLANT BY: SH. V IRENDRA KUMAR SINGH (DR) RES PONDENT BY: SH. P.N. ARORA, ADV. DATE O F HEARING: 19.08 .2015 DA TE OF PRONOUNCEME NT: 21 .08 .2015 ORDER PER BENCH : THESE ARE DEPARTMENTS APPEALS AND ASSESSEES CROSS OBJECTIONS, RESPECTIVELY, FOR ASSESSMENT YEAR S 2004 - 05 AND 2005 - 06. THE COMMON ISSUES BEING INVOLVED, THESE APPEALS AND CROSS OBJECTIONS ARE BEING DISPOSED OFF BY THIS COMMON ORDER. 2. AT THE OUTSET, THE LEARNED COUNSEL FOR THE ASSESSEE HAS STATED AT THE BAR THAT HE DOES NOT WISH TO PRESS THE CROSS OBJECTIONS FOR BOTH THE YEARS. ACCORDINGLY, THE CROSS OBJECTION NOS.15 & 16 ARE DISMISSED AS WITHDRAWN. 2 WTA NOS. 15 & 16 & C.O NOS .15 & 16 ASST. YEARS 2004 - 05 & 2005 - 06 3. APROPS BOTH THE APPEALS, THE WTO CONSIDERED THE LAND OF THE ASSESSEE AS AN ASSET ASSESSABLE TO WEALTH TAX, WITHIN T HE PROVISIONS OF EXPLANATION (B) TO SECTION 2 ( EA ) OF WEALTH TAX ACT. THE LEARNED CWT ( A ) DELETED THE CONSEQUENT ADDITION MADE BY THE WTO, ON ACCOUNT OF VALUE OF TAXABLE W EALTH STATED TO HAVE NOT BEEN DECLARED BY THE ASSESSEE. 4. THE LEARNED DR HAS CONTEND ED THAT THE LEARNED CWT ( A ) HAS ERRED IN DELETING THE ADDITION MADE, WI T H OUT CONSIDERING THAT AS PER SECTION 2 OF THE WEALTH TAX ACT, URBAN LAND IS TAXABLE AND THE ASSESSEE WAS IN POSSESSION OF URBAN LAND WHICH HE SOLD DURING ASSESSMENT YEAR 2006 - 07; AND TH AT THE LEARNED CWT ( A ) FAILED TO TAKING INTO CONSIDERATION THE FACT THAT THE DOCUMENTS SUBMITTED BY THE ASSESSE E DO NOT SPECIFICALLY INDICATE THAT CONSTRUCTION IS NOT ALLOWED OVER THE LAND OF THE ASSESSEE. 5. ON THE OTHER HAND, THE LEANRED COUNSEL FOR THE ASSESSEE HAS STRONGLY RELIED ON THE IMPUGEND ORDER, CONTENDING THAT THE LEARNED CWT(A) HAS CORRECTLY DELETED THE ADDITION WRONGLY MADE BY THE WTO, BY RIGHLTY TAKING INTO CONSIDERATION THE AMENDED PROVISIONS OF EXPLANATION 1(B) TO SECTION 2(EA) OF THE WEALTH TAX ACT. 6. WE HAVE HEARD THE RIVAL CONTENTIONS AND HAVE PERUSED THE MATER IAL ON RECORD. THE WTO HELD THE LAND OF THE ASSESSEE TO BE AN ASSET WITHIN THE MEANING OF SECTION 2(EA) OF THE WEALTH TAX ACT. WHILE DOING SO, THE WTO OBSERVED, INTERALIA, THAT THE DOCUMENTS FURNISHED BY THE ASSESSEE DID NOT SPECIFICALLY INDICATE THAT CONSTRUCTION WAS NOT ALLOWED ON THE LAND OF THE 3 WTA NOS. 15 & 16 & C.O NOS .15 & 16 ASST. YEARS 2004 - 05 & 2005 - 06 ASSESSEE AND THAT THE LAND LAY WITHIN THE GREEN ZONE DECLARED BY THE GOVERNMENT, RIGHT ACROSS THE DAL LAKE, SRIN AGAR. BEFORE THE LEARNED CWT ( A ) , HOWEVER, THE ASSESSEE TOOK AN ADDITIONAL PLEA AND RELIED ON THE AMENDMENT BROUGHT IN THE DEFINITION OF ASSET BY THE FINANCE ACT, 2013 WITH RETROSPECTIVE EFFECT FROM 1.04.1993, EXEMPTING LAND CLAS SIFIED AS AGRICULTURAL LAND IN THE RECORDS OF THE GOVT. AND USED FOR AGRICULTURAL PURPOSES, OR LAND ON WHICH CONSTRUCTION OF A BUILDING IS NOT PERMISSIBLE. THE ASSESSEE SUBMITTED ADDITIONAL EVIDENCE TO SUPPORT THE FACT THAT LAND IN QUESTION WAS AGRICULTURA L LAND AND AGRICULTURAL OPERATIONS WERE CARRIED ON T HEREAT. THIS EVIDENCE WAS TAKEN INTO CONSIDERATION BY THE LEARNED CWT ( A ) AND ON THE BASIS THEREOF AND THE SUBMISSIONS MADE BY THE ASSESSEE, THE LEANRED CWT ( A ) HELD THAT THE LAND OF THE ASSESSEE WERE EXEMP T FROM WEALTH TAX, BEING COVERE D BY THE AMENDED DEFINITION OF ASSET . 7. SINCE IT IS THE ABOVE ACTION OF THE LEARNED CWT ( A ) WHICH IS CHALLANGED BEFORE US AT THE HANDS OF THE DEPARTMENT, WE WILL DEAL WITH THIS ASPECT OF THE MATTER FIRST . 8. IN THIS REGARD IT IS SEEN THAT THE ORDER S OF THE WTO ARE DATED 16.12.2011. THE LEGISLATURE AMENDED SECTION 2(EA) OF THE WEALTH TAX ACT BY THE FINANCE ACT, 2013, WITH RETROSPECTIVE EFFECT FROM 1.04.1993 . PRIOR TO THE SAID AME NDMENT, EXPLANATION 1(B) DEFINED URBAN LAND NOT TO INCLUDE FOUR TYPES OF LAND, I.E., LAND ON WHICH CONSTRUCTION OF A BUILDING WAS NOT PERMISSISBLE, OR LAND HAVING A BUILDING CONSTRUCTED WITH DUE APPROVAL, OR UNUSED LAND HELD FOR INDUSTRIAL PURPOSES, AS PR ESCRIBED, OR LAND HELD AS 4 WTA NOS. 15 & 16 & C.O NOS .15 & 16 ASST. YEARS 2004 - 05 & 2005 - 06 STOCK - IN - TRAD E, AS PRESCRIBED. THE AMENDMENT MADE BROUGHT IN ANOTHER TYPE OF LAND TO BE EXEMPT FROM URBAN LAND AND T HUS, TO BE EXEMPT FROM ASSETS , AS DEFINED UNDER SECTION 2(EA)(V) OF THE WEALTH TAX ACT. AS PER THIS AMENDEMNT, LAND CLAS S IFIED AS AGRICULTURAL LAND I N THE RECORDS OF THE GOVERNMENT AND USED FOR AGRICULTURA L PURPOSES IS ALSO NOT TO MEAN URBAN LAND . NOW , OBVIOUSLY, SINCE THE AMENDMENT IS POST THE PASSING OF THE WTOS ORDER S, THERE WAS N O OCCASION FOR THE WTO TO TAKE INTO CONSIDERATION THE SAME. 9. SIN CE THE AMENDMENT IS RETROSPECTIVE, W.E.F 1.04.1993, IT DIRECTLY AFFECTED THE ASSESSEES CASES FOR BOTH THE YEAR S UNDER CONSIDERATION, I.E., ASSESSMENT YEARS 2004 - 05 & 2005 - 06. THAT BEING SO, THE OBVIOUS RECOURSE AVAILABLE TO THE ASSESSEE WAS THAT OF RAISIN G THE ISSUE BEFORE THE LEANRED CWT ( A ) , BEFORE WHOM, BOTH THE APPEALS WERE PENDING AT THE RELEVANT TIME. THE ASSESSEE DID SO, BY RAISING AN ADDITIONAL PLEA FOR BOTH THE YEARS . I N SUPPORT OF THE ADDITIONAL PLEA THAT THE LAND OF THE ASSESSEE STOOD CLASSIFIED IN THE RECORDS OF THE GOVT. AS AGRICULTURAL LAND AND WAS USED FOR AGRICULTURAL PURPOSES, THE ASSESSEE FILED ADDITIONAL EVIDENCE BEFORE THE LEARNED CWT ( A ), IN THE SHAPE OF COPY OF AGREEMENT TO SELL, DATE D 7.04.2005, SPECIFYING THE DETAILS OF THE LAND IN QU ESTION, IN KHESRA NO S ., COPY OF REVENUE RECORD, CLASSIFYING THE LAND AS ORCHARD LAND, C OPY OF PROPOSED LAND USED PLAND 2021 ISSUED BY THE SRIN AGAR DEVELOPMENT AUTHORITY, CLASSIFYI NG THE LAND OF THE ASSESSEE AS O RCHARD LAND. THE LEARNED CWT ( A ) CALLED FOR A REMAND REPORT ON THIS ISSUE FROM THE WTO. THE WTO SUBMITTED A REMAND REPORT DATED 5 WTA NOS. 15 & 16 & C.O NOS .15 & 16 ASST. YEARS 2004 - 05 & 2005 - 06 26.05.2014. WITH REGARD TO THE QUESTION OF ADMISSION OF ADDITIONAL EVIDENCE, THE WTO STATED THAT SINCE THE ASSESSEE DID NOT FULLFIL ANY OF THE CONDITIONS LAID D OWN IN RULE 46A OF THE IT RULES, 1962, THIS EVIDENCE BE NOT ADMITTED. WITH REGARD TO THE ME RITS OF THE ASSESSEE S CLAIM OF HIS LAND BEING CLASSIFIED AS AGRICULTURAL LAND IN THE GOVT. RECORD S AND USED FOR AGRICULTURAL PURPOSES, REFERRING TO THE AFORESAID A DDITIONAL EVIDENCE FURNISHED BY THE ASSESSEE, THE WTO MERELY STATED ; THE ISSUE MAY KINDLY BE TREATED AGRICULTURAL. 10. THEREFORE, THOUGH THE AMENDMENT TO SECTION 2(EA) OF THE WEAL TH TAX ACT WAS BROUGHT IN POST THE PASSING OF THE WTOS ORDERS DATED 16.12 .2011 AND THE ENTITLME NT OF THE ASSESSEE TO SEEK REFUG E THEREUNDER AROSE TO THE ASSESSEE ONLY BY VIRTUE OF THE PASSING OF THE FINANCE ACT, 2013, THE WTO DID NOT CONSIDER IT ENOUGH FULLFILMENT OF THE CONDITIONS OF RULE 46A OF THE INOCME TAX RULES, 1962. NOW , THIS BEING NOT CORRECT, AS THE ASSESSEE S QUARELY FALLS UNDER RULE 46A(C) OF THE RULES, HAVING BEEN PREVENTED BY SUFFICIENT CAUSE FROM PRODUCING BEFORE THE WTO, EVIDENCE RELEVANT TO THE ADDITIONAL PLEA RAISED BEFORE THE CWT ( A ) , THE LEARNED CWT ( A ) CORRECTL Y TOOK THE ADDITIONAL EVIDENCE INTO CONSIDERATION. 11. SO FAR AS REGARDS THE MERITS OF THE ISSUE, THE VERY FACT THAT THE WTO LEFT THE ISSUE OPEN TO BE TREATED ACCORDINGLY BY THE CWT ( A ) , SHOWS THE DIRECT APPLICABILITY OF THE ADDITIONAL EVIDENCE TO THE ISSUE AND ITS UNIMPEACHABLE VALUE IN SUPPORT OF THE ASSESSEES CLAIM OF THE LAND IN QUESTION BEING CLASSIFIED AS AGRICULTURAL LAND IN THE GOVT. RECORD S AND OF IT BEING USED FOR AGRICULTURAL PURPOSES. THE LEARNED CWT ( A ) DID TREAT THE ISSUE ACCORDINGLY, 6 WTA NOS. 15 & 16 & C.O NOS .15 & 16 ASST. YEARS 2004 - 05 & 2005 - 06 FIND ING THE DOCUMENTARY EVIDENCE FURNISHED BY THE ASSESSEE TO BE AMPLY PRO VING THE ASSESSEES CLAIM OF THE LAND BEING CLASSIFIED AS AGRICULTURAL LAND IN THE RECORDS OF THE GOVT. AND OF IT BEING USED FOR AGRICULTURAL PURPOSES. IT WAS THEREFORE, THAT THE LEARNED CWT ( A ) HELD AND, CORRECTLY SO , THAT THE LAND OF THE ASSES SEE WAS COVERED BY THE AMENDED DEFINITION OF ASSE T WITHIN THE MEANING OF SECTION 2(EA) OF THE WEALTH TAX ACT AND THAT IT WAS EXEMPT FROM LEVY OF WEALTH TAX. 12. BEFORE US, OTHER THAN MAKING BALD ASSERTIONS, THE DEPARMTNET HAS NOT BEEN ABL E TO SHOW AS TO HOW THE DECISION ARRIVED AT BY LEARNED CWT ( A ) IS EITHER ERRONEOUS , OR PERVERSE. THEREFORE, ONCE THE LAND OF THE ASSESSEE STANDS CLASSIFIED IN THE GOVT. RECORD S AS AGRICULTURAL LAND AND ONCE IT IS USED FOR AGRICULTURAL PURPOSES, THIS LAND INVARIABLY FALLS WITHIN THE AMENDED DEFINITION OF ASSET WITHIN THE MEANI NG OF SECTION 2(EA), BY WAY OF E XPLANATION 1(B) THERETO . 13. NOW, FOR COMPLETENESS, WE DEEM IT APPROPRIATE TO REVERT TO THE FINDINGS OF THE WTO, AS RECORDED AGAINST THE ASSESSEE FOR BOTH THE YEARS. AS PER THE WTO, THE DOCUMENTS FURNISHED BY THE ASSESSEE, I.E., A NOTIFICATION , SRO & R ECOMMENDATIONS OF COMMITTEE FOR LAKE F RON T A REA, DID NOT SPECIFICALLY INDICATE THAT CONSTRUCTION WAS NOT ALLOWED IN THE LAND OF THE ASSESSEE AND THAT THE LAND OF THE ASSESSEE LAY WITHIN THE AREA EX CLUDED FROM SUCH CONSTRUCTION. IN THE REMAND REPRT ALSO, THE WTO REITREATED THIS AND STATED THAT THE AS SESSEE HAD NOT FILED ANY DOCUMENT SPECIFICIALLY SUPPORTING HIS CLAIM. 7 WTA NOS. 15 & 16 & C.O NOS .15 & 16 ASST. YEARS 2004 - 05 & 2005 - 06 14. IT IS PERTINENT TO NOTE THAT THE REMAN D REPORT OF THE WTO DID NOT EVEN MENTION, MUCH LESS DEAL WITH THE ASSESSEES SPECIFIC SUBMISSIONS BEFORE THE LEARNED CWT ( A ) , THAT THE LAND IN Q UESTION WAS SIT UATED RIGHT ACROSS THE DAL LAKE, SRIN AGAR AND IT LAY WITHIN THE G REEN ZONE DECLARED BY THE GOVT. ; THAT THE LAND WAS AN ORCHARD AN D AGRICUL TURAL OPERATION S WERE CARRIED ON THEREAT; AND THAT AGRICULTURAL INCOME FROM THIS LAND WAS DECLARED IN THE INCOME TAX R ETURN FILED BY THE ASSESSEE, THE COPY OF SUCH INCOME TAX RETURN, COMPUTATION OF INCOME AND RECEIPTS AND EXPENDITURE DETAILS HAVING BEEN ENCLOSED ALONG WITH THE WRITTEN SU BMISSIONS DATED 13.3.2014 BY THE ASSESSEE BEFORE THE LEARNED CWT ( A ) AND THE LEARNED CWT ( A ) HAVING SOUGHT FOR THE REMAND REPORT FROM THE WTO IN CONSEQUENCE THEREOF ONLY. 15. BE THAT AS IT MAY, THE LEARNED CWT ( A ) HAS DECIDED THE MATTER ONLY ON THE ADDITIONA L PLEA RAISED BY THE ASSESSEE IN THE FIRST APPELLATE PROCEEDINGS. NOW, AS PER THE DEFINITION OF URBAN LAND WITHIN THE MEANIN G OF SECTION 2(EA), EXPLANATION 1(B), AS EXTANT, THERE ARE SEVEN TYPES OF LAND WHICH ARE NOT INCLUDED IN THE DEFINITION OF URBAN LAND . AND ALL THESE TYPES ARE MUTUALLY EXCLUSIVE, AS IS CLEAR FROM THE USE OF THE WORD OR AFTER EVERY TYPE OF LAND IS SPECIFIED. THEREFORE, ONCE THE LEARNED CWT ( A ) HELD THE LAND OF THE ASSESSEE TO BE EXEMPT ON ONE COUNT, I.E., THE LAND BEING CLASSIFIED AS AGRICULTURAL LAND IN THE RECORDS OF THE GOVT. AND USED FOR AGRICULTURAL PURPOSES, THIS FINDING WAS SUFFICIENT TO REVERSE THE ORDERS PASSED BY THE WTO, WHICH HAS CORRECTLY BEEN DONE. 8 WTA NOS. 15 & 16 & C.O NOS .15 & 16 ASST. YEARS 2004 - 05 & 2005 - 06 16. FOR THE ABOVE REASONS, THE GRIVEANCE OF THE D EPARTMENT IS FOUND T O BE UNSUSTAINABLE IN LAW. IT IS REJECTED AS SUCH. 17. IN THE RESULT, WTA NOS. 15 & 16 FILED BY THE DEPARTMENT ARE DISMISSED AND C . O. NOS. 15 & 16 FILED BY THE ASSESSEE ARE DISMISSED AS WITHDRAWN. ORDER PRONOUNCED IN THE OPEN COURT ON 2 1 S T AUGUST, 2015 . S D / - S D / - ( T. R. MEENA ) (A.D. JAIN) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 2 1 .08. 2015 /P K/ COPY OF THE ORDER FORWARDED TO: 1 . THE ASSESSEE: SH. VIKRAMDITYA SINGH, 2 . THE ACWT, CIRCLE - 2, JAMMU . 3 . THE CW T(A), 4 . THE CWT , 5 . THE SR DR, I.T.A.T., TRUE COPY BY ORDER (ASSISTANT REGISTRAR) INCOME TAX APPELLATE TRIBUNAL, AMRITSAR BENCH: AMRITSAR.