VIDHYA POONIA, Jaipur V. ITO, Jaipur

ITA 1064/JPR/2016

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 6119 (ITAT-JAIPUR)
• Duration Of Justice: 1 year(s) 5 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-05-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 2006-2007
• Appeal Filed On: 05-12-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: J C KULHERI JCIT DHK
• Keywords: Reopening of assessment; Capital asset; Additional evidence; Cost of acquisition; Tangible material; Reason to believe; Reassessment proceedings
• Section: 143(3); 54B; 2(14); 147; 148; 144

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR JH FOT; IKY JKWO] U;KF;D LNL; ,O A JH HKKXPUN KNO] YS[KK LNL; DS LE{K BEFORE: SHRI VIJAY PAL RAO, JM & SHRI BHAGCHAND, A M VK;DJ VIHY LA- @ ITA NO. 1064/JP/2016 FU/KZKJ.K O'K Z @ ASSESSMENT YEARS : 2006-07. SMT. VIDHYA POONIA, 33, SURAJ NAGAR EAST, CIVIL LINES, JAIPUR. CUKE VS. THE INCOME TAX OFFICER, WARD 2(3), JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO. AGAPP 0755 B VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI RAJEEV SOGANI (C.A.) JKTLO DH VKSJ LS@ REVENUE BY : SHRI J.C. KULHERI (JCIT) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 20.03.2018. ?KKS'K .KK DH RKJH[K @ DATE OF PRONOUNCEMENT : 21/05/2018. VKNS'K@ ORDER PER VIJAY PAL RAO, J.M. THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER DATED 28 TH SEPTEMBER, 2016 OF LD. CIT (A)-1, JAIPUR FOR THE AS SESSMENT YEAR 2006-07. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL :- 1(A) IN THE FACTS AND CIRCUMSTANCES OF THE CASE A ND IN LAW THE LD. CIT (A) HAS ERRED IN CONFIRMING THE VALIDITY OF THE ACT ION OF THE LD. AO IN REOPENING THE ASSESSMENT U/S 147 OF INCOME TA X ACT, 1961. THE ACTION OF LD. CIT (A) IS ILLEGAL, UNJUSTI FIED, ARBITRARY AND AGAINST THE FACTS OF THE CASE. RELIEF MAY PLEAS E BE GRANTED BY QUASHING THE REASSESSMENT PROCEEDINGS BEING ILLE GAL AND WITHOUT ANY BASIS. 2 ITA NO. 1064/JP/2016 SMT. VIDHYA POONIA, JAIPUR. 2(A) IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT (A) HAS ERRED IN CONFIRMING THE ACTION OF THE LD. A O IN MAKING THE ADDITION OF RS. 1,21,80,000/- AS LONG TERM CAPI TAL GAIN. THE ACTION OF LD. CIT (A) IS ILLEGAL, UNJUSTIFIED, ARBI TRARY AND AGAINST THE FACTS OF THE CASE. RELIEF MAY PLEASE BE GRANTED BY DELETING THE SAID ADDITION OF RS. 1,21,80,000/-. (B) IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT (A) HAS ERRED IN CONFIRMING THE ACTION OF THE LD. A O IN TREATING THE SOLD AGRICULTURE LAND AS CAPITAL ASSET. THE ACT ION OF LD. CIT (A) IS ILLEGAL, UNJUSTIFIED, ARBITRARY AND AGAINST THE FACTS OF THE CASE. RELIEF MAY PLEASE BE GRANTED BY QUASHING THE ACTION OF LD. CIT (A) IN TREATING THE NON CAPITAL ASSET (AGRICULT URAL LAND) AS CAPITAL ASSET. IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT (A) HAS ERRED IN CONFIRMING THE ACTION OF THE LD. A O IN TREATING THE AGRICULTURE LAND AS SHORT TERM CAPITAL ASSET. T HE ACTION OF LD. CIT (A) IS ILLEGAL, UNJUSTIFIED, ARBITRARY AND AGAI NST THE FACTS OF THE CASE. RELIEF MAY PLEASE BE GRANTED BY QUASHING THE ACTION OF LD. CIT (A) IN TREATING THE AGRICULTURAL LAND AS SHORT TERM CAPITAL ASSET. (D) IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT (A) HAS ERRED IN CONFIRMING THE ACTION OF THE LD. A O IN NOT ALLOWING THE EXEMPTION U/S 54B AMOUNTING TO RS. 1,1 1,45,700/-. THE ACTION OF LD. CIT (A) IS ILLEGAL, UNJUSTIFIED, ARBITRARY AND AGAINST THE FACTS OF THE CASE. RELIEF MAY PLEASE BE GRANTED BY ALLOWING THE DEDUCTION OF RS. 1,11,45,700/- U/S 54B OF THE IT ACT, 1961 . (E) IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT (A) HAS ERRED IN CONFIRMING THE ACTION OF THE LD. A O IN NOT ALLOWING THE FULL DEDUCTION OF RS. 17,40,960/- OF C OST OF ACQUISITION OF LAND. THE ACTION OF LD. CIT (A) IS I LLEGAL, UNJUSTIFIED, ARBITRARY AND AGAINST THE FACTS OF THE CASE. RELIEF MAY PLEASE BE GRANTED BY ALLOWING THE DEDUCTION OF RS. 17,40,960/- OF COST OF ACQUISITION OF LAND. (F) IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT (A) HAS ERRED IN REJECTING THE CONTENTION OF THE AP PELLANT THAT WHERE NO ADDITION WAS MADE BY THE LD. AO ON PURCHAS E OF IMMOVABLE PROPERTY FOR WHICH THE PROCEEDINGS U/S 14 7 OF THE ACT WERE INITIATED NO FURTHER ADDITION CAN BE MADE FOR OTHER ALLEGED ESCAPED INCOMES. THE ACTION OF LD. CIT (A) IS ILLEGAL, UNJUSTIFIED, ARBITRARY AND AGAINST THE FACTS OF THE CASE. RELIEF 3 ITA NO. 1064/JP/2016 SMT. VIDHYA POONIA, JAIPUR. MAY PLEASE BE GRANTED BY DELETING THE ADDITION MADE BY LD. AO AND CONFIRMED BY CIT (A) WHICH ARE ILLEGAL AND CONT RARY TO ESTABLISHED LEGAL PROPOSITION. 3. THE ASSESSEE CRAVES HER RIGHT TO ADD, AMEND OR A LTER ANY OF THE GROUNDS ON OR BEFORE THE HEARING. GROUND NO. 1 IS REGARDING VALIDITY OF REOPENING OF THE ASSESSMENT UNDER SECTION 147 OF THE IT ACT. 2. THE ASSESSEE IS AN INDIVIDUAL AND DID NOT FILE H ER RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION. THE AO RECEIVED AIR INFOR MATION REGARDING THE INVESTMENT OF RS.40,00,000/- MADE BY THE ASSESSEE IN A PROPERT Y. ACCORDINGLY, THE AO INITIATED THE PROCEEDINGS UNDER SECTION 148 OF THE ACT VIDE N OTICE DATED 23 RD MARCH, 2013. DURING THE COURSE OF REASSESSMENT PROCEEDINGS, THE ASSESSEE EXPLAINED THAT THE SOURCE OF INVESTMENT IS THE SALE OF EXISTING IMMOVA BLE PROPERTY AND ACCORDINGLY THE AO MADE AN ADDITION OF RS. 1,21,80,000/- AS LONG TE RM CAPITAL GAIN. THE ASSESSEE CHALLENGED THE ACTION OF THE AO BEFORE THE LD. CIT (A) AND ALSO RAISED THE OBJECTION AGAINST THE REOPENING OF THE ASSESSMENT. HOWEVER, T HE LD. CIT (A) DID NOT ACCEPT THE CONTENTION OF THE ASSESSEE AND UPHELD THE VALID ITY OF THE REOPENING. 3. BEFORE US, THE LD. A/R OF THE ASSESSEE HAS SUBMI TTED THAT THE AO HAS REOPENED THE ASSESSMENT ON THE BASIS OF AIR INFORMA TION REGARDING THE PURCHASE OF IMMOVABLE PROPERTY BY THE ASSESSEE FOR A CONSIDERAT ION OF RS. 40,00,000/-. WHEREAS THE ASSESSEE HAS DULY EXPLAINED THE SOURCE OF SAID INVESTMENT AND FURTHER THE ASSESSEE FILED THE RETURN OF INCOME FOR THE ASSESSM ENT YEAR UNDER CONSIDERATION. THEREFORE, THE REASONS RECORDED BY THE AO DO NOT EX PLAIN THE CORRECT FACTS AND THE AO HAS PROCEEDED TO REOPEN THE ASSESSMENT WITHOUT A PPLICATION OF MIND AND 4 ITA NO. 1064/JP/2016 SMT. VIDHYA POONIA, JAIPUR. CONSIDERING THE CORRECT FACTS REGARDING THE RETURN OF INCOME FURNISHED BY THE ASSESSEE. THE LD. A/R HAS FURTHER CONTENDED THAT E VEN THE APPROVAL/SANCTION OBTAINED BY THE AO FROM THE ADDITIONAL CIT IS NOT P ROPER AS THE SAME WAS GRANTED IN A MECHANICAL ROUTINE MANNER WITHOUT APPLICATION OF MIND. THUS THE LD. A/R HAS CONTENDED THAT THE AO HAS REOPENED THE ASSESSMENT W ITH A VIEW TO VERIFY THE PURCHASE OF IMMOVABLE PROPERTY. THUS THE AO MISDIR ECTED HIMSELF IN INVOKING THE PROVISIONS OF SECTION 148 AS THE CORRECT COURSE OF ACTION WOULD HAVE BEEN INVOKING THE PROVISIONS OF SECTION 143(3) WHICH TALKS ABOUT VERIFICATION OF THE FACTS OF RETURN OF INCOME. HENCE THE LD. A/R HAS SUBMITTED THAT TH E REASONS RECORDED BY THE AO ARE NOT SUFFICIENT TO FORM THE BELIEF THAT THE INCO ME ASSESSABLE TO TAX HAS ESCAPED ASSESSMENT. IN SUPPORT OF HIS CONTENTION HE HAS REL IED UPON THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF CIT VS. S. GOYANKA LIM E & CHEMICAL LTD., 64 TAXMANN.COM 313 (SC) AS WELL AS THE DECISION OF HON BLE MADHYA PRADESH HIGH COURT WHICH WAS UPHELD BY THE HONBLE SUPREME COURT IN THE SAID CASE OF CIT VS. S. GOYANKA LIME & CHEMICAL LTD. (SUPRA). THUS THE LD. A/R HAS SUBMITTED THAT THE SATISFACTION OF THE APPROVING AUTHORITY WHICH ACCOR DED THE SANCTION FOR ISSUING NOTICE UNDER SECTION 148 IS WITHOUT ANALYZING THE FACTS AN D WAS GIVEN MECHANICALLY. THEREFORE, THE SAME IS NOT SUSTAINABLE. 3.1. ON THE OTHER HANDS, THE LD. D/R HAS RELIED UPO N THE ORDER OF THE LD. CIT (A) AND SUBMITTED THAT WHEN THE ASSESSEE DID NOT FILE A NY RETURN OF INCOME AND ALSO NOT DISCLOSED EITHER THE SALE TRANSACTION OF THE EXISTI NG CAPITAL ASSET OR THE PURCHASE TRANSACTION, THEREFORE, WHEN THE AO HAS RECEIVED TH E AIR INFORMATION OF PURCHASE OF 5 ITA NO. 1064/JP/2016 SMT. VIDHYA POONIA, JAIPUR. IMMOVABLE PROPERTY OF RS. 40,00,000/-, THE SAME CON STITUTE A TANGIBLE MATERIAL TO FORM THE BELIEF THAT INCOME ASSESSABLE TO TAX HAS E SCAPED ASSESSMENT. 4. HAVING CONSIDERED THE RIVAL SUBMISSIONS AS WELL AS THE RELEVANT MATERIAL ON RECORD, WE NOTE THAT THE AO REOPENED THE ASSESSMENT BY RECORDING THE REASONS AS UNDER :- AS PER THE AIR INFORMATION GENERATED FROM THE SYST EM, THE ASSESSEE HAS PURCHASED IMMOVABLE PROPERTY OF RS. 40,00,000/- DURING FY 2005- 06 RELEVANT FOR AY 2006-07. SINCE AS PER SYSTEM NO RETURN OF INCOME HAS BEEN FI LED FOR AY 2006-07, THE ABOVE TRANSACTION IS NOT VERIFIABLE. I HAVE THE REFORE REASONS TO BELIEVE THAT ON ACCOUNT OF NOT FILING OF RETURN BY THE ASSESSEE, INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT. IN VIEW OF ABOVE, I HAVE REASON TO BELIEVE THAT THE INCOME TO THE EXTENT OF RS. 40,00,000/- HAS ESCAPED ASSESSMENT WI THIN THE MEANING OF SECTION 147 OF THE I.T. ACT, 1961. THEREFORE, NO TICE U/S 148 IS TO BE ISSUED. SD/- (HIMANSHU TEWARI) INCOME TAX OFFICER, WARD 2(3), JAIPUR. THUS THE AO HAS RECEIVED THE INFORMATION THAT THE A SSESSEE HAS PURCHASED IMMOVABLE PROPERTY OF RS. 40,00,000/- DURING THE YE AR UNDER CONSIDERATION. FURTHER, THE AO NOTED THAT AS PER THE SYSTEM NO RETURN OF IN COME HAS BEEN FILED BY THE ASSESSEE AND THUS THE AO PROPOSED TO REOPEN THE ASS ESSMENT TO ASSESS THE INCOME OF RS. 40,00,000/- WHICH HAS ESCAPED ASSESSMENT. T HOUGH THE ASSESSEE HAS RAISED AN ISSUE BEFORE THE LD. CIT (A) THAT THE ASSESSEE F ILED RETURN OF INCOME, HOWEVER, WE NOTE THAT THE SAID RETURN OF INCOME WAS NOT FILED W ITH THE AO RANGE-2 WHO IS HAVING 6 ITA NO. 1064/JP/2016 SMT. VIDHYA POONIA, JAIPUR. THE JURISDICTION OVER THE ASSESSEE BUT THE ALLEGED RETURN WAS, IF ANY, FILED WITH THE JURISDICTION OF RANGE-5. THUS WE FIND THAT THE AO W AS HAVING NO MATERIAL OR INFORMATION ABOUT THE RETURN OF INCOME FILED BY THE ASSESSEE IN WRONG JURISDICTION AND, THEREFORE, THE ASSESSEE CANNOT TAKE AN EXCUSE OF SUCH RETURN OF INCOME FILED IN THE JURISDICTION OF THE AO OTHER THAN THE AO HAVING THE JURISDICTION OVER THE ASSESSEE. FURTHER, THE LD. CIT (A) HAS ALSO VERIFI ED THIS FACT THROUGH THE REMAND REPORT CALLED FROM THE AO AND THEREAFTER DECIDED TH IS ISSUE IN PARA (III) TO (VIII) OF HIS ORDER AS UNDER :- (III) I HAVE DULY CONSIDERED THE SUBMISSION OF THE APPELL ANT, ASSESSMENT ORDER AND THE MATERIAL PLACED ON RECORD. IT APPEARS FROM THE COPY OF ACKNOWLEDGEMENT FORM FILED BY THE APPEL LANT THAT APPARENTLY IT FILED ITS INCOME TAX RETURN FOR THE A Y 2006-07 UNDER CONSIDERATION IN THE OFFICE OF THE ADDL. CIT, RANGE -5, JAIPUR WHEREAS THE CORRECT JURISDICTION WAS WITH THE AO. IN THE CA SE OF B.M. MALANI VS. CIT (SUPRA), IT WAS HELD BY THE HON'BLE APEX COURT THAT A PERSON CANNOT TAKE ADVANTAGE OF HIS OWN WRONG, MAY ALSO HA VE TO BE BORNE IN MIND. THEREFORE, THE APPELLANT CANNOT BE ALLOWED TO TAKE ADVANTAGE OF ITS OWN WRONG FOR FILING ITS RETURN OF INCOME WITH AN AO WHO IS NOT HAVING JURISDICTION TO ASSESS THE INCOME OF THE APP ELLANT. (IV) FURTHER, IT WOULD BE APPROPRIATE TO REPRODUCE THE P ROVISIONS OF SECTION 124 OF THE ACT WHICH DEALS WITH THE JURISDI CTION OF AO AS UNDER: 7 ITA NO. 1064/JP/2016 SMT. VIDHYA POONIA, JAIPUR. 'JURISDICTION OF ASSESSING OFFICERS. 124. (1) WHERE BY VIRTUE OF ANY DIRECTION OR ORDER ISSUED UNDER SUB- SECTION (1) OR SUB-SECTION (2) OF SECTION 120, THE ASSESSING OFFICER HAS BEEN VESTED WITH JURISDICTION OVER ANY AREA, WITHIN THE LIMITS OF SUCH AREA, HE SHALL HAVE JURISDICTION - (A) IN RESPECT OF ANY PERSON CARRYING ON A BUSINESS OR PROFESSION, IF THE PLACE AT WHICH HE CARRIES ON HIS BUSINESS OR PROFESSION IS SITUATE WITHIN THE AREA, OR WHERE HIS BUSINESS OR PROFESSION IS CARRIED ON IN MORE PLACES THAN ONE, IF THE PRINCIPAL PLACE OF HIS BUSINESS OR PROFESSION IS SITUATE WITHIN THE AREA, AND (B) IN RESPECT OF ANY OTHER PERSON RESIDING WITHIN THE AREA. (2) WHERE A QUESTION ARISES UNDER THIS SECTION AS TO WHETHER AN ASSESSING OFFICER HAS JURISDICTION TO ASSESS ANY PERSON, THE QUESTION SHALL BE DETERMINED BY THE DIRECTOR GENERAL OR THE CHIEF COMMISSIONER OR THE COMMISSIONER; OR WHERE THE QUESTION IS ONE RELATING TO AREAS WITHIN THE JURISDICTION OF DIFFERENT DIRECTORS GENERAL OR CHIEF COMMISSIONERS OR COMMISSIONERS, BY THE DIRECTORS GENERAL OR CHIEF COMMISSIONERS OR COMMISSIONERS CONCERNED OR, IF THEY ARE NOT IN AGREEMENT, BY THE BOARD OR BY SUCH DIRECTOR GENERAL OR CHIEF COMMISSIONER OR COMMISSIONER AS THE BOARD MAY, BY NOTIFICATION I N THE OFFICIAL GAZETTE, SPECIFY. (3) NO PERSON SHALL BE ENTITLED TO CALL IN QUESTION THE JURISDICTION OF AN ASSESSING OFFICER (A) WHERE HE HAS MADE A RETURN UNDER SUB-SECTION (1) OF SECTION 115WD OR UNDER SUB-SECTION (1) OF SECTION 139, AFTER THE EXPIRY OF ONE MONTH FROM THE DATE ON WHICH HE WAS SERVED WITH A NOTICE UNDER SUB- SECTION (1) OF SECTION 142 OR SUB-SECTION (2) OF SECTION 1 15WE OR SUB- 8 ITA NO. 1064/JP/2016 SMT. VIDHYA POONIA, JAIPUR. SECTION (2) OF SECTION 143 OR AFTER THE COMPLETION OF THE ASSESSMENT, WHICHEVER IS EARLIER. (B) WHERE HE HAS MADE NO SUCH RETURN, AFTER THE EXPIRY OF THE TIME ALLOWED BY THE NOTICE UNDER SUB-SECTION (2) OF SECTION 115WD OR SUB- SECTION (1) OF SECTION 142 OR UNDER SUB-SECTION (1) OF SECTION 115WH OR UNDER SECTION 148 FOR THE MAKING OF THE RETURN OR BY THE NOTICE UNDER THE FIRST PROVISO TO SECTION 115WF OR UNDER THE FIRST PROVISO TO SECTION 144 TO SHOW CAUSE WHY THE ASSESSMENT SHOULD NOT BE COMPLETED TO THE BEST OF THE JUDGMENT OF THE ASSESSING OFFICER, WHICHEVER IS EARLIER. (4) SUBJECT TO THE PROVISIONS OF SUB-SECTION (3), WHERE AN ASSESSEE CALLS IN QUESTION THE JURISDICTION OF AN ASSESSING OFFICE R, THEN THE ASSESSING OFFICER SHALL, IF NOT SATISFIED WITH THE CORRECTNESS OF THE CLAIM, REFER THE MATTER FOR DETERMINATION UNDER SUB-SECTION (2) BEFORE THE ASSESSMENT IS MADE. (5) NOTWITHSTANDING ANYTHING CONTAINED IN THIS SECTION OR IN ANY DIRECTION OR ORDER ISSUED UNDER SECTION 120, EVERY ASSESSING OFFICER SHALL HAVE ALL THE POWERS CONFERRED BY OR UNDER THIS ACT ON AN ASSESSING OFFICER IN RESPECT OF THE INCOME ACCRUING OR ARISING OR RECEIVED WITHIN T HE AREA, IF ANY, OVER WHICH HE HAS BEEN VESTED WITH JURISDICTION BY VIRTUE OF THE DIRECTIONS OR ORDERS ISSUED UNDER SUB-SECTION (1) OR SUB-SECTION (2) OF SECTION 120.' (V) THUS, IT IS TO BE NOTED THAT AS PER THE PROVISI ONS OF SECTION 124(5) OF THE ACT, THE PRESENT AO HAD THE TERRITORI AL JURISDICTION OVER THE APPELLANT. FURTHER, AS PER PROVISIONS OF S ECTION 124(3), THE APPELLANT CAN CHALLENGE THE JURISDICTION OF THE AO WITHIN ONE MONTH OF THE EARLIEST NOTICE ISSUED BY THE CONCERNE D AO, WHEREAS IN THE INSTANT CASE UNDER CONSIDERATION, TH E APPELLANT, APPARENTLY, RAISED THE JURISDICTION ISSUE FOR THE F IRST TIME ON 9 ITA NO. 1064/JP/2016 SMT. VIDHYA POONIA, JAIPUR. 20.02.2014 I.E. JUST 8 DAYS BEFORE THE PASSING OF T HE ASSESSMENT ORDER UNDER CONSIDERATION AND AS PER THE PROVISIONS OF SECTION 124(3) OF THE ACT, THE APPELLANT HAD LOST ITS RIGHT TO AGITATE THE JURISDICTION OF THE AO AT THAT POINT OF TIME. (VI) IT WAS THE ANOTHER CONTENTION OF THE APPELLANT THAT THE APPELLANT FILED ITS RETURN OF INCOME FOR THE A.Y 20 05-06 IN THE SAME JURISDICTION, WHICH WAS DULY ACCEPTED BY THE DEPART MENT. THEREFORE, THE ACTION OF THE APPELLANT IN FILING THE SUBSEQUEN T RETURN IN THE SAME JURISDICTION CANNOT BE FAULTED WITH. I HAVE DULY CONSIDERED THE ACKNOWLEDGEMENT FORM FILED BY THE AR FOR THE AY 2005-06 AND IT WAS OBSERVED THAT THE PREVIOUS YEAR HAS BEEN STATED AS FROM 01.04.2005 TO 31.03.2006, AY AS 2005-06 AND TH E DATE FOR FURNISHING THE RETURN WAS STAMPED AS 20 JUL 2005 WH ICH RAISES SERIOUS DOUBTS ABOUT THE GENUINENESS OF SUCH ACKNOWLEDGEMENT FORM. FURTHER, THE SAID ACKNOWLEDGE MENT FORM, CERTAINLY, CANNOT BE FOR THE AY 2005-06 AS CL AIMED BY THE AR. (VII) IT MAY BE MENTIONED THAT IN ITS REPLY DATED 26.04.2 013 IN RESPONSE TO NOTICE DATED 23.03.2013 ISSUED U/S 148 OF THE ACT, IT WAS STATED BY THE AR THAT THE RETURN OF INCOME F ILED ON 25.04.2006 MAY BE TREATED AS RETURN FILED IN PURSUA NCE TO NOTICE ISSUED U/S 148 OF THE ACT. IT IS NOTED THAT IN THE ACKNOWLEDGEMENT FORM FILED BY THE AR FOR THE AY 200 6-07, COPY OF SALE AGREEMENT IN 6 PAGES AND COPY OF PURCH ASE AGREEMENT CONSISTING OF 16 PAGES WERE STATED TO BE ENCLOSED, HOWEVER, IT IS PERTINENT TO MENTION THAT THE COPIES OF THE 10 ITA NO. 1064/JP/2016 SMT. VIDHYA POONIA, JAIPUR. PURCHASE DEEDS AND SALE DEEDS WERE NOT FURNISHED BE FORE THE AO DURING THE COURSE OF ASSESSMENT PROCEEDINGS AND THESE WERE PRODUCED AS ADDITIONAL EVIDENCE DURING THE COU RSE OF APPELLATE PROCEEDINGS. FURTHER, THE AR HAS NOT FILE D ANY PROCESSING ORDER U/S 143(1)(A) OF THE ACT OR ANY OT HER COMMUNICATION FROM THE DEPARTMENT IN RESPECT OF ALL EGED RETURNS OF INCOME CLAIMED TO BE FILED IN THE OFFICE OF ADDL. COMMISSIONER OF INCOME TAX, RANGE-5, JAIPUR. (VIII) THEREFORE, LOOKING TO THE TOTALITY OF FACTS AND CIRCUMSTANCES OF THE CASE AS DISCUSSED ABOVE AND SI NCE THE AO HAD THE TERRITORIAL JURISDICTION OVER THE APPELL ANT, IT IS HELD THAT THE AO HAS INITIATED PROCEEDINGS U/S 147 OF TH E ACT IN A VALID AND LAWFUL MANNER. HENCE, THIS GROUND OF APPE AL IS HEREBY REJECTED. AS THESE GROUNDS OF APPEAL ARE RELATED TO DETERMINA TION OF LONG TERM CAPITAL GAIN RELATING TO LAND SOLD BY THE APPELLANT DURING THE YEAR UNDER CONSIDERATION, NOT ALLOWING THE COST OF ACQUISITION IN RESPECT OF LAND SOLD AND ALS O NOT ALLOWING THE EXEMPTION U/S 54B OF THE ACT ON ACCOUNT OF PURC HASE OF AGRICULTURE LAND AS CLAIMED TO BE PURCHASED BY THE APPELLANT. HENCE, THESE ARE BEING ADJUDICATED TOGETHER. WHEN THE RETURN OF INCOME WAS NOT FILED WITH THE AO THEN THE ALLEGED RETURN OF INCOME FILED WITH THE WRONG JURISDICTION CANNOT BE CONSIDERED FOR THE PURPOSE OF DECIDING THE VALIDITY OF REOPENING AS THE AO AT THE TIME OF INITIATION OF PROCEEDINGS 11 ITA NO. 1064/JP/2016 SMT. VIDHYA POONIA, JAIPUR. UNDER SECTION 148 HAS TO FORM THE BELIEF ON THE BAS IS OF THE MATERIAL AVAILABLE WITH THE AO WHICH IS SUFFICIENT FOR COMING TO THE CONCLU SION THAT PRIMA FACIE THE INCOME ASSESSABLE TO TAX HAS ESCAPED ASSESSMENT. AS REGARD S THE OBJECTION AGAINST THE APPROVAL OF REASONS FOR RE-OPENING, WE NOTE THAT NO SUCH OBJECTION WAS RAISED BEFORE THE AUTHORITIES BELOW. FURTHER, THE ADDL. CI T GRANTED THE APPROVAL BY CONSIDERING THE RELEVANT FACTS AS UNDER :- APPROVAL IS GRANTED FOR REOPENING OF ASSESSMENT, AS THE ASSESSES MENTIONED ABOVE HAVE MADE INVESTMENTS/EXPENDITURE O F THE AMOUNTS MENTIONED AGAINST THEIR NAME & NO RETURN OF INCOME HAS BEEN FILED. THUS IT IS CLEAR THAT THE APPROVAL WAS GRANTED BY D UE APPLICATION OF MIND. HENCE WE DO NOT FIND ANY INFIRMITY IN THE APPROVAL. THEREFO RE, WE DO NOT FIND ANY MERIT OR SUBSTANCE IN THE OBJECTION OF THE ASSESSEE AGAINST THE REOPENING OF THE ASSESSMENT. GROUND NO. 2 IS REGARDING THE ADDITION MADE BY THE AO UNDER SECTION 2(14) AS LONG TERM CAPITAL GAIN OF RS. 1,21 ,80,000/-. 5. WE HAVE HEARD THE LD. A/R AS WELL AS THE LD. D/R AND CONSIDERED THE RELEVANT MATERIAL ON RECORD. THE LD. A/R OF THE ASSESSEE HA S RAISED THE OBJECTION THAT THE PROPERTY IN QUESTION IS AN AGRICULTURAL LAND AND, T HEREFORE, DOES NOT FALL IN THE AMBIT OF THE TERM CAPITAL ASSET AS PER THE PROVISIONS OF SECTION 2(14) OF THE IT ACT. HE HAS SUBMITTED THAT THE PROPERTY IS ALSO SITUATED BEYOND 8 KM FROM THE MUNICIPAL LIMIT OF JAIPUR AND HENCE THE SALE CONSIDERATION OF AGRICULT URAL LAND CANNOT BE TAXED AS CAPITAL GAIN. IN SUPPORT OF HIS CONTENTION, HE HAS RELIED UPON THE DECISION OF THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF PR INCIPAL CIT VS. SHRI KHETI LAL SHARMA HUF DATED 21 ST NOVEMBER, 2017 IN DB IT APPEAL NO. 170/2016 AND 12 ITA NO. 1064/JP/2016 SMT. VIDHYA POONIA, JAIPUR. 165/2017. THUS THE LD. A/R HAS SUBMITTED THAT THE HONBLE HIGH COURT HAS UPHELD THE DECISION OF THIS TRIBUNAL IN THE CASE OF SMT. ( DR.) SUBHA TRIPATHI VS. DCIT IN ITA NO. 1129/JP/2011, WHEREIN THE TRIBUNAL HAS HELD THA T THE DISTANCE OF 8 KM FROM THE MUNICIPAL LIMITS HAS TO BE CONSIDERED AT THE TIME O F NOTIFICATION DATED 6 TH JANUARY, 1994 AND NOT AT THE TIME OF SALE OF THE PROPERTY. T HE LD. A/R HAS ALSO FILED A COPY OF GOOGLE MAP SHOWING DISTANCE OF THE PROPERTY IN QUES TION. AN ALTERNATIVE PLEA HAS ALSO BEEN TAKEN BY THE LD. A/R REGARDING CLAIM OF D EDUCTION OF RS. 1,11,45,700/- UNDER SECTION 54B OF THE ACT. 5.1. ON THE OTHER HAND, THE LD. D/R HAS RELIED ON T HE ORDERS OF THE AUTHORITIES BELOW. 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WELL AS THE RELEVANT MATERIAL ON RECORD. THE ASSESSEE RAISED THIS OBJECTION EVEN BE FORE THE AO AS WELL AS LD. CIT (A). HOWEVER, THE AO HAS OBTAINED A REPORT OF THE TEHSIL DAR CONCERN AND HELD THAT THE PROPERTY IN QUESTION IS SITUATED WITHIN 8 KM FROM T HE JAIPUR MUNICIPAL LIMITS AND ACCORDINGLY IS LIABLE TO LONG TERM CAPITAL GAIN. T HE LD. A/R OF THE ASSESSEE HAS NOW DISPUTED THE CORRECTNESS OF THE SAID CERTIFICATE IS SUED BY THE TEHSILDAR ON THE GROUND THAT THE DISTANCE OF THE PROPERTY HAS TO BE CONSIDERED AS ON THE DATE OF NOTIFICATION DATED 6 TH JANUARY, 1994. SO FAR AS THE ISSUE OF CONSIDERING THE DISTANCE FROM MUNICIPAL LIMITS AS ON THE DATE OF NOTIFICATIO N DATED 6 TH JANUARY, 1994, WE FIND THAT THIS ISSUE WAS CONSIDERED BY THIS TRIBUNAL AND NOW UPHELD BY THE HONBLE JURISDICTIONAL HIGH COURT IN CASE OF PRINCIPAL CIT VS. SHRI KHETI LAL SHARMA HUF (SUPRA). HOWEVER, THE QUESTION REMAINS THAT WHETHE R ON THE DATE OF NOTIFICATION THE DISTANCE OF THE PROPERTY IN QUESTION WAS SITUATED W ITHIN THE DISTANCE OF 8 KM FROM 13 ITA NO. 1064/JP/2016 SMT. VIDHYA POONIA, JAIPUR. THE JAIPUR MUNICIPAL LIMITS OR BEYOND 8 KM. WE FUR THER NOTE THAT AS PER THE LANGUAGE OF SECTION 2(14)(III)(B) THE DISTANCE HAS TO BE BETWEEN THE MUNICIPAL LIMITS AND THE AREA IN WHICH THE PROPERTY IS SITUATED. THU S THE DISTANCE IS REQUIRED TO BE CONSIDERED FROM THE MUNICIPAL LIMITS AND THE AREA A ND NOT THE PARTICULAR PROPERTY. SINCE THE ASSESSEE HAS RAISED AN ISSUE WHICH IS FAC TUAL IN NATURE AS TO WHETHER THE AREA IN WHICH THE PROPERTY IS SITUATED WITHIN THE D ISTANCE OF 8 KM FROM THE MUNICIPAL LIMITS OF JAIPUR OR BEYOND IT AS ON 6 TH JANUARY, 1994, THEREFORE, THE SAME IS REQUIRED TO BE VERIFIED AT THE LEVEL OF THE AO BY CONDUCTING A PROPER ENQUIRY. ACCORDINGLY HAVING REGARD TO THE FACTS AND CIRCUMSTANCES, WE SE T ASIDE THIS ISSUE TO THE RECORD OF THE AO FOR CONSIDERATION AND DECIDING THE SAME AFRE SH IN THE LIGHT OF ABOVE OBSERVATIONS. 7. THE OTHER GROUNDS RAISED BY THE ASSESSEE REGARDI NG DEDUCTION UNDER SECTION 54B AS WELL AS DEDUCTION OF COST OF ACQUISITION ARE CONSEQUENTIAL IN NATURE TO THE ISSUE WHICH HAS BEEN REMANDED TO THE AO. ACCORDING LY THESE ISSUES ARE ALSO STAND REMANDED TO THE RECORD OF THE AO TO BE CONSIDERED A ND DECIDED AS PER LAW AND AS PER THE OUTCOME OF THE FIRST ISSUE. 8. IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 21/05/20 18. SD/- SD/- HKKXPUN FOT; IKY JKWO (BHAGCHAND) ( VIJAY PAL RAO ) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 21/05/2018. DAS/ 14 ITA NO. 1064/JP/2016 SMT. VIDHYA POONIA, JAIPUR. VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- SMT. VIDHYA POONIA, JAIUPR. 2. IZR;FKHZ@ THE RESPONDENT-THE ITO WARD 2(3), JAIPUR 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDR@ CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR 6. XKMZ QKBZY@ GUARD FILE {ITA NO. 1064/JP/2016} VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASST. REGISTRAR