Late G. Sukender Reddy, Rep.by L/R. G. Sujnith Reddy, Hyderabad V. Income Tax Officer, Ward-8(2), Hyderabad

ITA 1144/Hyd/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 2507 (ITAT-HYDERABAD)
• Duration Of Justice: 7 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-02-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 19-02-2018
• Assessment Year: 2004-2005
• Appeal Filed On: 05-07-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Cost of acquisition
• Section: 142(1); 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES B SMC BENCH: HYDERABAD BEFORE SHRI D. MANMOHAN, VICE PRESIDENT ITA. NO.1144/HYD/2017 ASSESSMENT YEAR: 2004 - 2005 LATE G. SUKENDER REDDY, REP. BY L/R G. SUJNITH (ELDER SON), H.NO. 3 - 4 - 121, HYDERGUDA (V), RAJENDERNAGAR MANDAL, HYDERABAD. PAN: A H OPG 7326 C VS . INCOME TAX OFFICER, WARD - 8(2), HYDERABAD. (APPELLANT) (RESPONDENT) FOR ASSESSEE: SHRI A.V. RAGHURAM FOR REVENUE : SMT. N. SWAPNA, DR DATE OF HEARING : 19.02.2018 DATE OF PRONOUNCEMENT : 19.02.2018 ORDER PER D. MANMOHAN , VP. THIS APPEAL IS DIRECTED AGAINST THE ORDER PASSED BY LD. CIT(A) - 2, HYDERABAD AND IT PERTAINS TO ASSESSMENT YEAR 2004 - 05. 2. THE ASSESSEE SHRI G. SUKENDER REDDY ENTERED INTO AN AGREEMENT OF SALE - CUM - GPA FOR SALE OF LAND ADMEASURING 34 GUNTAS IN SURVEY NO.36, UPPARAPELLY VILLAGE, RANGA REDDY DISTRICT. SINCE THE AGREEMENT OF SALE - CUM - GPA WAS ENTERED INTO ON 22.01.2004, THE SALE TOOK PLACE DURING THE PERIOD RELEVANT TO THE ASSESSME NT YEAR 2004 - 05. ACCORDING TO THE ASSESSEE, INITIAL / PART CONSIDERATION WAS RECEIVED DURING THE PREVIOUS YEAR RELEVANT TO THE ASSESSMENT YEAR 2004 - 05 AND THE BALANCE SALE CONSIDERATION WAS RECEIVED IN INSTALMENTS ON VARIOUS POINTS OF TIME TILL THE YEAR 2 005. AS COULD BE NOTICED FROM THE STATEMENT OF FACTS FILED BEFORE THE A.O, THE ASSESSEE WAS WRONGLY ADVISED BY SHRI MR. THOHA 2 BALAKRISHNA TO OFFER CAPITAL GAINS ON SALE OF LAND IN THE ASSESSMENT YEAR 2006 - 07. LATER ASSESSEE FILED AN APPEAL BEFORE THE LD. CIT(A) CLAIMING THAT THE SAME IS NOT ASSESSABLE TO TAX IN THE ASSESSMENT YEAR 2006 - 07. SINCE THE ASSESSEE CLAIMS THAT IT IS ASSESSABLE TO TAX IN THE ASSESSMENT YEAR 2004 - 05, A NOTICE WAS ISSUED U/S 148 OF THE A CT AND THEREAFTER THE CASE WAS CONVERTED INT O SCRUTINY BY ISSUING NOTICES U/S 143(2) AND 142(1) AND A QUESTIONNAIRE WAS ALSO ISSUED BUT NONE APPEARED ON BEHALF OF THE ASSESSEE. THEREFORE, THE A.O PROCEEDED TO COMPLETE THE ASSESSMENT TO THE BEST OF HIS JUDGMENT WHEREIN HE OBSERVED THAT THE TOTAL REC EIPTS WERE TO THE TUNE OF RS. 27,70,570/ - AND THE ASSESSEE HAVING NOT PROVED THE SOURCE THEREOF THE SAME WAS TREATED AS INCOME OF THE ASSESSEE. 3. AGGRIEVED, ASSESSEE CONTENDED BEFORE THE LD. CIT(A) THAT THE ASSESSING OFFICER ERRED IN MAKING ADDITION OF RS. 27,70,570/ - OVERLOOKING THE FACT THAT THE SAID AMOUNT IS PART OF SALE CONSIDERATION RECEIVED DURING DIFFERENT TRANCHES. IT WAS FURTHER CONTENDED THAT THE A.O. OUGHT TO HAVE ALLOWED DEDUCTION FOR THE INDEXED COST OF ACQUISITION OF THE ASSET IN QUESTION AND WOULD HAVE COMPUTED THE CAPITAL GAINS ACCORDINGLY. THOUGH THE APPEAL WAS PREFERRED IN 2010, THE MATTER WAS NOT TAKEN UP BY THE LD. CIT(A) TILL 2017. SHRI G. SUKENDER REDDY PASSED AWAY ON 02 ND MAY 2013 AND HIS LEGAL REPRESENTATIVE SHRI G. SUJNEETH RED DY INFORMED THE LD. CIT(A) ABOUT THE DATE OF DEATH AND ALSO REQUESTED TO SUBSTITUTE HIS NAME AS LEGAL REPRESENTATIVE ON RECORD. COPY OF THE DEATH CERTIFICATE WAS PLACED BEFORE THE LD. CIT(A). PAGES 125 TO 135 OF THE PAPER BOOK REFERS TO THE LETTERS ADDRE SSED BY THE LEGAL REPRESENTATIVE TO THE LD. CIT(A) STATING THE FACTUM OF DEATH OF THE ASSESSEE AND ALSO TO BRING THE LR ON RECORD. HOWEVER, LD. CIT(A) DISPOSE D OF THE APPEAL BY NOT MENTIONING THE NAME OF THE LEGAL REPRESENTATIVE. THE ORDER WAS PASSED BY THE LD. CIT(A) IN THE NAME OF SHRI G. SUKHENDER REDDY. IN FACT THE ORDER OF THE LD. CIT(A) DO ES NOT 3 INDICATE AS TO WHETHER THE LEGAL REPRESENTATIVE WAS BROUGHT ON RECORD AND WHETHER ANY NOTICE WAS ISSUED TO THE LEGAL REPRESENTATIVE BEFORE DISPOSING OF THE APPEAL EX - PARTE . 4. AGGRIEVED, ASSESSEE PREFERRED AN APPEAL BEFORE THE TRIBUNAL CONTENDING , INTER ALIA , THAT PROPER OPPORTUNITY WAS NOT GIVEN BY THE LD. CIT(A) AND THE ORDER PASSED IN THE NAME OF A DE AD PERSON IS NON EST IN LAW. 5. AT THE TIME OF HEARIN G, LEARNED COUNSEL FOR THE ASSESSEE ADVERTED MY ATTENTION TO THE LETTERS ADDRESSED TO THE COMMISSIONER TO SUBMIT THAT THREE APPEALS WERE FILED IN RESPECT OF THREE ASSESSMENT YEARS I.E., 2004 - 05 TO 2006 - 07 AND THE ASSESSEE HAS ALREADY REQUESTED THE FIRST AP PELLATE AUTHORITY TO CLUB ALL THE APPEAL S BUT , WITHOUT REJECTING THE CLAIM , THE LD. CIT(A) DISPOSED OF ONE APPEAL I.E., FOR THE A.Y. 2004 - 05. IT WAS ALSO SUBMITTED THAT THOUGH THE APPEALS WERE FILED IN 2010, TILL DATE THE APPEALS WERE NOT EVEN POSTED FOR HEARING. IN OTHER WORDS, THE APPEALS FOR THE ASSESSMENT YEARS 2005 - 06 AND 2006 - 07 ARE STILL PENDING BEFORE THE LD. CIT(A) BUT THE APPEAL FOR THE ASSESSMENT YEAR 2004 - 05 WAS DISPOSED OF EX - PARTE, QUA THE ASSESSEE AND THAT TOO IN THE NAME OF A D E A D PERSON WHICH IS NON EST IN LAW AND IN THIS REGARD HE RELIED UPON THE ORDER OF THE ITAT HYDERABAD A (SMC) BENCH IN THE CASE OF LATE BADRINARAYAN RATHI (ITA NO.1427/HYD/2015) WHEREIN THE COURT OB SERVED THAT AN ORDER PASSED IN THE NAME OF A DEA D PERSON WITHOUT BRINGING THE LEGAL REPRESENTATIVE ON RECORD BECOMES NULL AND VOID. 6. ON THE OTHER HAND, LEARNED DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT THE ORDER HAVING BEE N PASSED BY THE LD. CIT(A) EX - PARTE, ONE MORE OPPORTUNITY CAN BE GIVEN TO THE ASSESSEE BY SETTING ASIDE THE MATTER. 4 7. I HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE RECORD. THOUGH APPEALS WERE FILED FOR THREE ASSESSMENT YEARS, IT IS NOT KNOWN AS TO WHY TWO APPEALS ARE YET TO BE DISPOSED OF AND EVEN THE APPEAL FOR THE A.Y. 2004 - 05 WAS DISPOSED OF WITHOUT BRINGING THE LEGAL REPRESENTATIVE ON RECORD WHICH, AS PER THE DECISION OF THE SMC BENCH (SUPRA), IS NULL AND VOID. SUFFICE IT TO SAY THAT THE LD. CIT(A) HAVING NOT EXERCISED HIS MIND OVER THE TECHNICAL ASPECT OF THE MATTER, I SET ASIDE THE ORDER OF THE LD. CIT(A) AND DIRECT HIM TO DISPOSE OF THE APPEALS IN ACCORDANCE WITH LAW. UNDER THESE CIRCUMSTANCES, I ADVISE THE LD. CIT(A) TO DISPOSE OF ALL THE THREE APPEALS AT THE EARLIEST, PREFERABLY WITHIN THREE MONTHS FROM THE DATE OF THIS ORDER. 8. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER PASSED IN THE OPEN COURT ON 19 TH FEBRUARY, 2018. S D / - (D. MANMOHAN) VICE PRESIDENT HYDERABAD, DATED: 19 TH FEBRUARY, 2018. OKK, SR.PS COPY TO 1. A.V. RAGHU RAM, P. VINOD & M. NEELIMADEVI, ADVOCATES, 610, BABUKHAN ESTATE, BASHEERBAGH, HYDERABAD - 1. 2. INCOME TAX OFFICER, WARD 8(2), SIGNATURE TOWERS, KO0NDAPUR ROAD, HYDERABAD - 84. 3. CIT (A) - 2, HYDERABAD. 4. PR. CIT - 2, HYDERABAD. 5. DR, ITAT, HYDERABAD. 6. GUARD FILE