Smt. S Vijayalakshmi, Hyderabad V. Addl.CIT, Kurnool

ITA 1117/HYD/2013

• Counselvise Citation: 111722514 RSA 2013
• Duration Of Justice: 1 year(s) 5 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-01-2015
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 07-01-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 01-08-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RAMAKRISHNA BANDI
• Assessee Lawyers: G VENKATESWARLU

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A, HYDERABAD BEFORE SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER ITA NO. 1117/HYD/2013 ASSESSMENT YEAR: 2007-08 SMT.S. VIJAYALAKSHMI, KURNOOL [PAN: ADNPV 7677 A] VS ADDL. COMMISSIONER OF INCOME TAX, KURNOOL (APPELLANT) (RESPONDENT) FOR ASSESSEE : SHRI G.VENKATESWARLU, AR FOR REVENUE : S HRI RAMAKRISHNA BANDI, DR DATE OF HEARING : 0 7 - 0 1 - 201 5 DATE OF PRONOUNCEMENT : 16 - 01 - 2015 O R D E R PER B. RAMAKOTAIAH, A.M. : THIS IS AN APPEAL BY ASSESSEE AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX(APPEALS)-IV, HYDERABAD D ATED 27-02-2012. 2. BRIEFLY STATED, ASSESSEE, AN INDIVIDUAL HAS FILE D RETURN OF INCOME IN WHICH ASSESSING OFFICER RE-COMPUTED THE C APITAL GAINS AND MADE AN ADDITION OF RS.42,14,381/- BEING 50% SHARE ON THE SALE OF BUILDING AT ANGALLU. THERE IS NO DISPUTE WITH REFE RENCE TO THE SALE PRICE OF RS.1.11 CRORES. THE DISPUTE IS WITH REFER ENCE TO THE INVESTMENT MADE BY ASSESSEE AND PROPORTIONATE SHARE IN THE I.T.A. NO. 1117 /HYD/13 SMT.S. VIJAYALAKSHMI :- 2 -: PROPERTY. ASSESSING OFFICER WAS OF THE OPINION THA T ASSESSEE'S SHARE IS 50% AND HAS TAKEN INVESTMENT/COST OF ASSET AT RS .18,25,000/-, WHEREAS IT WAS THE ASSESSEE'S CONTENTION THAT THERE ARE FOUR PERSONS WHO INVESTED IN PROPERTY ALONG WITH HER HUSBAND AND SHARE OF INVESTMENT WAS RS.24,75,000/-. ASSESSING OFFICER D ID NOT ACCEPT THE CLAIMS AND LD.CIT(A) CONFIRMED THE SAME. 3. IT WAS FAIRLY ADMITTED THAT SIMILAR ISSUE IN HAN DS OF THE ASSESSEE'S HUSBAND SHRI K.V.SUBBA REDDY HAS BEEN AD JUDICATED BY THE ITAT IN ITA NO.1299/HYD/2013 AND C.O.NO.01/HYD/ 2014 VIDE ORDER DT.06-06-2014, WHEREIN THE ISSUE WAS RESTORED TO THE FILE OF THE ASSESSING OFFICER FOR FRESH ADJUDICATION AFTER EXAM INING THE FACTS. THE ORDER OF ITAT IN PARA 23 IS AS UNDER: 23. WE HEARD BOTH SIDES AND PERUSED THE ORDERS OF T HE REVENUE AUTHORITIES AND OTHER MATERIAL AVAILABLE ON RECORD. WE HAVE ALSO GONE THROUGH THE ELABORATE WRITTEN SUBMISSION OF THE ASS ESSEE ON THIS ISSUE. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE BUILDING, APPURTENANT TO THE LAND IN QUESTION IS AS MUCH 32,0 00 SQ. FT., FOR WHICH THE COST ADOPTED BY THE ASSESSING OFFICER WAS A MEA GER RS.23,15,000. IT WAS FURTHER SUBMITTED THAT EXPENDITURE AGGREGATI NG TO RS.80 LAKHS WAS INCURRED FOR CONSTRUCTION OF THE BUILDING AND I NVESTMENT WAS MADE BY THE ASSESSEE, HIS WIFE, HIS BROTHER, SHRI K.VIJAYA RAJU SUBBA REDDY, AND HIS SISTER IN LAW, SMT.G.NIRMALAMMA. IT WAS ALSO POINTED OUT THAT THE INVESTMENT MADE BY SMT.NIRMALAMMA HAS BEEN REFLECTED IN HER INCOME-TAX RETURN AS WELL. AS AGAINST THIS, IT WAS SUBMITTED THAT THE ASSESSING OFFICER HAS DETERMINED CAPITAL GAINS TO BE ASSESSED IN THE HANDS OF THE ASSESSEE AT 50%, ON AN ERRONEOUS A SSUMPTION THAT IT WAS ONLY THE ASSESSEE AND HIS WIFE, WHO ALONE CONTR IBUTED TO THE INVESTMENT IN THE CONSTRUCTION OF THE BUILDING. WE FIND MERIT IN THESE CONTENTIONS OF THE ASSESSEE. HOWEVER, THESE FACTUA L ASPECTS OF THE MATTER, PLEADED BY THE LEARNED COUNSEL FOR THE ASSE SSEE, WHICH GO TO THE MATTER AND RELEVANT FOR DETERMINATION OF THE IS SUE, NEED VERIFICATION BY THE ASSESSING OFFICER. WE ACCORDINGLY, SET ASID E THE IMPUGNED ORDER OF THE CIT(A) AND RESTORE THE MATTER TO THE F ILE OF THE ASSESSING OFFICER WITH A DIRECTION TO VERIFY THE ABOVE FACTUA L ASPECTS OF THE MATTER AND REDETERMINE THE CAPITAL GAINS LIABLE TO BE ASSE SSED IN THE HANDS OF THE ASSESSEE FOR THE YEAR UNDER APPEAL. THE ASSESS ING OFFICER SHALL FAIR OPPORTUNITY OF HEARING TO THE ASSESSEE, WHO IS AT LIBERTY TO ADDUCE NECESSARY EVIDENCE TO SUBSTANTIATE ITS CLAIM. THE A SSESSING OFFICER, THEREAFTER, CONSIDERING ALL ASPECTS OF THE MATTER, SHALL PASS APPROPRIATE I.T.A. NO. 1117 /HYD/13 SMT.S. VIJAYALAKSHMI :- 3 -: ORDERS REDETERMINING THE CAPITAL GAINS TO BE ASSESS ED IN THE HANDS OF THE ASSESSEE, IN ACCORDANCE WITH LAW. RESPECTFULLY FOLLOWING THE SAME, WE SET ASIDE THE IMPUGNED ORDERS OF THE ASSESSING OFFICER AND CIT(A) AND RESTORE THE MA TTER TO THE FILE OF ASSESSING OFFICER WITH A DIRECTION TO VERIFY THE FA CTUAL ASPECTS AND RE- DETERMINE THE CAPITAL GAINS TO BE ASSESSED IN THE H ANDS OF ASSESSEE. ASSESSING OFFICER SHALL GIVE FAIR OPPORTUNITY OF HE ARING TO ASSESSEE. WITH THIS, THE GROUNDS ARE ALLOWED FOR STATISTICAL PURPOSES. 4. THE NEXT ISSUE FOR CONSIDERATION IS WITH REFEREN CE TO THE ADDITION MADE OUT OF AGRICULTURAL INCOME. ASSESSEE OFFERED AN INCOME OF RS.5 LAKHS AS AGRICULTURAL INCOME WHEREAS ASSESSING OFFICER CONSIDERING THE PAST YEAR'S INCOMES RE-DETE RMINED THE INCOME AT RS.2 LAKHS AND REMAINING RS.3 LAKHS WAS TREATED AS 'INCOME FROM OTHER SOURCES'. SINCE THE INVESTMENT IN THE HANDS OF SHRI K.V.SUBBA REDDY WAS ASSESSED AT AN AMOUNT OF RS.7 CRORES, THI S ADDITION WAS CONSIDERED PROTECTIVELY. IT WAS FAIRLY ADMITTED TH AT THE ISSUE IN THE HANDS OF SHRI SUBBA REDDY WAS SETTLED IN THAT ASSES SEE'S FAVOUR, THEREFORE, THE DISALLOWANCE MADE IN THE HANDS OF TH E ASSESSEE BECOMES REGULAR ADDITION. IT IS THE CONTENTION OF THE ASSESSEE THAT AN AMOUNT OF RS.5 LAKHS WAS EARNED AS AGRICULTURAL INC OME AND NECESSARY EVIDENCES WERE FURNISHED TO THE AUTHORITI ES. 5. CONSIDERING THE RIVAL ARGUMENTS AND ORDERS OF TH E AUTHORITIES, WE PARTIALLY AGREE WITH THE ASSESSEE'S CONTENTIONS. AS SEEN FROM THE ORDER OF THE ASSESSING OFFICER, ASSESSEE WAS ONLY O FFERING INCOMES OF RS.60,000/-, RS.78,200/- AND RS.1,75,700/- IN THE E ARLIER THREE YEARS ON THE AGRICULTURAL LAND. EVEN THOUGH IT WAS SUBMITTED THAT THE LAND HOLDING HAS NOT CHANGED IN THE YEARS, THE INCOME HAS SUDDENLY JUMPED FROM RS.1.75 LAKHS TO RS.5 LAKHS IN THE IMPUGNED I.T.A. NO. 1117 /HYD/13 SMT.S. VIJAYALAKSHMI :- 4 -: ASSESSMENT YEAR (AY). CONSIDERING THE SUBMISSIONS FOR ASSESSEE AND PAST RECORD, WE ARE OF THE OPINION THAT AGRICULTURA L INCOME CAN BE DETERMINED AT RS.2,50,000/-. CONSEQUENTLY, ASSESSI NG OFFICER IS DIRECTED TO RESTRICT THE AMOUNT TO RS. 2,50,000/- O NLY. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON 16 TH JANUARY, 2015. SD/- SD/- (SAKTIJIT DEY) (B. RAMAKOTAIAH) JUDICIAL MEMBER ACCOUNTANT MEMBER HYDERABAD, DATED 16 TH JANUARY, 2015. TNMM COPY TO : 1. SMT. S.VIJAYALAKSHMI, C/O. P.MURALI & CO., CHARTERE D ACCOUNTANTS, 6-3-655/2/3, 1 ST FLOOR, SOMAJIGUDA, HYDERABAD- 500 082. 2. ADDL. COMMISSIONER OF INCOME TAX, KURNOOL. 3. CIT(A)-IV, HYDERABAD 4. CIT-III, HYDERABAD 5. D.R. ITAT, HYDERABAD.