Priti Mehrotra, Bareilly V. Income Tax Officer-2(1), Bareilly

ITA 10/LKW/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 4010 (ITAT-LUCKNOW)
• Duration Of Justice: 7 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-08-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 13-07-2016
• Assessment Year: 2011-2012
• Appeal Filed On: 14-01-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: YOGESH AGARWAL
• Keywords: Sale consideration of property below Jantri Value; Capital asset
• Section: 143(3); 50C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH : LUCKNOW BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER ITA NO.10/LKW/2016 ASSESSMENT YEAR : 2011-12 SMT. PRITI MEHROTRA, OLD WIMCO VILLA, 172-ATUNEYA, CIVIL LINES, BAREILLY 243 001. (U.P.) PAN: AEVPM 0902L VS. THE INCOME TAX OFFICER, 2(1), BAREILLY. APPELLANT RESPONDENT APPELLANT BY : SHRI YOGESH AGARWAL, ADVOCATE RESPONDENT BY : SHRI AMIT NIGAM, DR DATE OF HEARING : 15.07.2016 DATE OF PRONOUNCEMENT : 31.08.2016 O R D E R THIS APPEAL IS PREFERRED BY THE ASSESSEE AGAINST THE ORDER DATED 18.11.2015 OF THE CIT(APPEALS), BAREILLY INTER ALIA ON THE FOLLOWING GROUNDS:- I. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS), BAREILLY [HERE-IN-AFTER REFERRED TO AS THE LD. CIT (A)'S] GROSSLY ERRED ON FACTS AND IN LAW IN CONFORMING THE ORDER P ASSED BY THE ASSESSING OFFICER U/S. 143(3) BY NOT CONSIDERING TH E LAND SO SOLD TO BE AGRICULTURAL AND THUS AS THE LAND WAS NOT A C APITAL ASSET WITHIN THE DEFINITION OF SEC. 2(47) OF THE ACT NO T AX COULD AT ALL HAVE BEEN LEVIED AND SUBSEQUENTLY THE ADDITION SO MADE OF RS.21,75,225/- BEING BAD-IN-LAW AND VOID-AB-INITIO MAY KINDLY BE ORDERED TO BE DELETED. ITA NO.10/LKW/2016 PAGE 2 OF 4 II. IN CONFORMING THE ADDITION THE LD. CIT (A)'S F AILED TO APPRECIATE AND RATHER CHOSE TO IGNORE THE FACT THAT THE LAND IN QUESTION IS ACTUALLY AGRICULTURE AND THAT IT WAS ON LY AN INADVERTENT MISTAKE IN THE SALE DEED THAT THE NATURE OF LAND WA S SHOWN AS RESIDENTIAL AND THUS THE ADDITION BEING DEVOID OF A NY MERIT MAY KINDLY BE ORDERED TO BE DELETED. III. ON THE FACTS AND PECULIAR CIRCUMSTANCES OF THE PRESENT CASE THE LD. CIT (A)'S GROSSLY ERRED IN CONFORMING THE A DDITION AS THE LANDS WERE BEING SUBJECTED TO LAND REVENUE AND WERE AGRICULTURAL IN NATURE ON WHICH AGRICULTURAL OPERATIONS WERE BEI NG CARRIED ON EVEN AS PER REVENUE RECORDS. NOTWITHSTANDING AND WITHOUT PREJUDICE TO ALL THE ABOVE GROUNDS: - IV. THE LD. CIT (A)'S FURTHER GROSSLY ERRED ON FAC TS AND IN LAW IN ACCEPTING THE VALUATION OF THE PLOTS AS DONE BY THE AVO WHO HAS VALUED THE PLOTS WHICH ARE ADJACENT TO EACH OTH ER AT GROSS VARIATION IN RATES @ 25 LACS PER HECTARE AND 150 LA CS PER HECTARE DESPITE THE FACT THAT THEY HAVE ALMOST THE SAME MAR KETABLE VALUE AND THUS THE ADDITION SO BASED ON A REPORT WHICH IS ITSELF VITIATED IS BAD-IN-LAW AND VOID-AB-INITIO. V. THAT THE LD. CIT (A)'S DID NOT AFFORD THE APPELL ANT ANY PROPER OR SUFFICIENT OPPORTUNITY TO HAVE HER SAY OR MAKE NECESSARY COMPLIANCE OF THE REASONS RELIED UPON BY HIM IN CONFORMING THE ADDITIONS AND THUS THE ORDER SO PASS ED WITHOUT AFFORDING ADEQUATE OPPORTUNITY MAY KINDLY BE ORDERE D TO BE QUASHED. 2. DURING THE COURSE OF HEARING, THE LD. COUNSEL F OR THE ASSESSEE HAS INVITED OUR ATTENTION THAT THE ASSESSEE HAS SOLD TW O PLOTS OF LAND, ONE PLOT BEARING NO.727 AND THE OTHER NO.731. INADVERTENTLY , SHE MENTIONED PLOT NO.731 AS A RESIDENTIAL PLOT, THOUGH AGRICULTURAL O PERATION WAS GOING ON. ON THE BASIS OF THE CONTENTS OF THE SALE DEED, THE AO HAS TREATED THIS PLOT TO BE A CAPITAL ASSET AND NOT AGRICULTURAL LAND, AN D MADE A REFERENCE TO ITA NO.10/LKW/2016 PAGE 3 OF 4 DVO FOR ASCERTAINING THE VALUE, HAVING INVOKED THE PROVISIONS OF SECTION 50C OF THE ACT; AGAINST WHICH AN APPEAL WAS FILED BEFORE THE CIT(APPEALS). 3. THE CIT(APPEALS) TOOK COGNIZANCE OF THE SALE DEE D AND DECLARATION OF THIS PLOT AS A RESIDENTIAL PLOT AS PER ADM(FR), BAREILLY. BUT THOUGH THE ASSESSEE HAS CONTENDED BEFORE THE CIT(APPEALS) THAT THIS PLOT BEARING NO.731 WAS IN FACT AGRICULTURAL LAND AND AFTER THE EXECUTION OF SALE DEED, THE BUYER HAS ALSO GOT THE NATURE OF LAND CONVERTED INTO NON-AGRICULTURAL LAND, BUT THIS ASPECT WAS NOT EXAMINED BY THE CIT(A PPEALS) AND HE CONFIRMED THE ADDITIONS MADE BY THE AO. 4. AGGRIEVED, THE ASSESSEE HAS PREFERRED AN APPEAL BEFORE THE TRIBUNAL AND REITERATED ITS CONTENTIONS. 5. THE LD. DR PLACED RELIANCE UPON THE ORDER OF CIT (APPEALS). 6. HAVING CAREFULLY EXAMINED THE ORDERS OF LOWER AU THORITIES IN THE LIGHT OF RIVAL SUBMISSIONS, I FIND THAT THE CIT(APPEALS) HAS TAKEN COGNIZANCE OF THE ADM(FR), BAREILLY REPORT, BUT THE COPY OF THE S AME IS NOT PLACED ON RECORD. THE ASSESSEE, HOWEVER, FILED A COPY OF THE KHASRA IN ORDER TO ESTABLISH THE NATURE OF LAND, BUT IN THIS KHASRA TH OUGH IT IS MENTIONED THAT POTATO WAS CULTIVATED ON THIS LAND, BUT IT IS NOT C LEAR FOR WHICH YEAR THIS COPY OF KHASRA BELONGS. 7. THE RELEVANT ISSUE TO BE EXAMINED IS THAT WHEN T HE LAND IN QUESTION WAS SOLD AND WHETHER IT WAS AN AGRICULTURAL LAND AT THE TIME OF SALE? IF ITS ITA NO.10/LKW/2016 PAGE 4 OF 4 USE HAS BEEN CHANGED TO NON-AGRICULTURAL PURPOSE, T HE ASSESSEE CANNOT CLAIM THAT THE PLOT IN QUESTION TO BE EXEMPTED FROM THE CATEGORY OF CAPITAL ASSET, BUT IT IS AGRICULTURAL LAND. THESE CLEAR FA CTS ARE NOT AVAILABLE BEFORE ME, BUT PRIMA FACIE , I FIND THAT ASSESSEE HAS PLACED ENORMOUS EVIDENCE TO ESTABLISH THAT THE LAND IN QUESTION WAS AN AGRICULT URAL LAND, BUT IT WAS NOT PROPERLY VERIFIED AND EXAMINED BY THE CIT(APPEALS). I THEREFORE SET ASIDE THE ORDER OF CIT(APPEALS) AND RESTORE THE MATTER TO HIS FILE WITH A DIRECTION TO READJUDICATE THE ISSUE AFRESH IN THE LIGHT OF CO PIES OF KHASRA AND ORDERS OF TAHSILDAR FOR CONVERTING THE LAND INTO NON-AGRIC ULTURAL PURPOSE. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON THIS 31 ST DAY OF AUGUST, 2016. SD/- (SUNIL KUMAR YADAV ) JUDICIAL MEMBER LUCKNOW, DATED, THE 31 ST AUGUST, 2016. /D S/ COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT. BY ORDER ASSISTANT REGISTRAR.