Augustan Textile Colours Limited, Coimbatore V. JCIT, Coimbatore

ITA 118/CHNY/2016

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 7982 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-02-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Next Hearing Date: 30-01-2017
• Assessment Year: 2011-2012
• Appeal Filed On: 21-01-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: H KABILA JT
• Assessee Lawyers: C A VENKATESAN
• Keywords: Reassessment proceedings
• Section: 143(3); 142(1); 148; 144

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL BENCH C, CHENNAI , !' . ' $ %, & %' BEFORE SHRI SANJAY ARORA, ACCOUNTANT MEMBER AND SHRI G. PAVAN KUMAR, JUDICIAL MEMBER ./ ITA NO.41/MDS/2013 & ) '*) / ASSESSMENT YEAR : 2008-09 R.KARTHIKEYAN, L/H OF N.V RAMESH BABU, 18, EDAYAR STREET, COIMBATORE 641 001. [PAN: AAGHN 5015A ] (,-/ APPELLANT ) VS. INCOME TAX OFFICER, WARD-III(3), COIMBATORE 641 018. (./,-/ RESPONDENT) ,- 0 1 / APPELLANT BY : SHRI C.A.VENKATESAN, CA ./,- 0 1 /RESPONDENT BY : SMT. H.KABILA, JT. CIT $ ' 0 2 /DATE OF HEARING : 29.11.2016 3* 0 2 /DATE OF PRONOUNCEMENT : 03.02.2017 / O R D E R PER SANJAY ARORA, AM : THIS IS AN APPEAL BY THE ASSESSEE DIRECTED AGAINST THE ORDER BY THE COMMISSIONER OF INCOME TAX (APPEALS)-I, COIMBATORE (CIT(A) FOR SHORT) DATED 19.10.2012, DISMISSING THE ASSESSEES APPEAL CONTESTING ITS ASSESSMENT U/S. 144 R/W S.147 OF THE INCOME TAX ACT, 1961 (THE ACT HEREINAFTER) DATED 30.12.2011 FOR ASSESSMENT YEAR (AY) 2008-09. 2 ITA NO.41 /MDS/2013 (AY 2008-09) R.KARTHIKEYAN V. I TO 2. ASSESSMENT IN THE INSTANT CASE STANDS MADE TO BR ING TO TAX THE CAPITAL GAINS ARISING TO ASSESSEE-HUF ON THE SALE OF ITS ANCESTRA L PROPERTY WHICH HAD EARLIER (VIDE ORDER U/S. 143(3) DATED 22.12.2010) BEEN ASSE SSED IN THE (INDIVIDUAL) HANDS OF THE KARTA, SHRI N.V.RAMESH BABU, WHO EXPIR ED ON 03.07.2011, BY INITIATING REASSESSMENT PROCEEDINGS. THE BASIS OF T HE SAME WAS THE MENTION IN THE SALE DEED, AS WELL AS THE ADMISSION BY THE KART A IN HIS INDIVIDUAL ASSESSMENT PROCEEDINGS (VIDE LETTER FILED ON 20.12.2010), OF T HE SUBJECT PROPERTY AS BELONGING TO HUF, SO THAT THE CAPITAL GAINS ARE TO BE TAXED IN HIS HUF CAPACITY. NO RETURN BEING FURNISHED IN RESPONSE TO THE NOTICE U/S. 148 DATED 03.01.2011, NOR ANY REPLY TO THE NOTICE U/S. 142(1) (DATED 26.0 6.2011), THE ASSESSING OFFICER (AO) FINALIZED THE ASSESSMENT BY ADOPTING, INSTEAD OF THE STATED SALE CONSIDERATION OF . 48 LACS, THE GUIDELINE VALUE OF . 60.75 LACS ON THE DATE OF SALE (22.02.2008), I.E., THE SAME VALUE AS ADOPTED EARLIER IN COMPUTING THE LONG TERM CAPITAL GAINS (LTCG) IN THE HANDS OF THE INDIV IDUAL. NO IMPROVEMENT IN ITS CASE BEING MADE IN APPEAL, THE ASSESSMENT STOOD CON FIRMED AS SUCH, SO THAT THE ASSESSEE IS IN SECOND APPEAL, RAISING SEVERAL GROUN DS TOWARD DIFFERENT OBJECTIONS. 3. WE HAVE HEARD THE PARTIES, AND PERUSED THE MATE RIAL ON RECORD. QUA THE OBJECTION AS TO THE ASSESSMENT ORDER BEARING THE AS SESSEES GIR NUMBER (AND NOT PERMANENT ACCOUNT NUMBER (PAN)), AS RIGHTLY STATED BY THE LD. CIT(A), WOULD NOT MAKE THE ASSESSMENT ORDER INVALID (REFER PARA 6 OF THE IMPUGNED ORDER). IT IS IN FACT THE ASSESSEE WHO IS THE RESPONSIBLE FOR THE SAME INASMUCH AS IT DID NOT FILE ANY RETURN NOR REPLY, AND WHICH OUGHT TO BEAR THE PAN (S. 139A(5)). IN FACT, THE ASSESSEE HAD NO PAN, AND APPLIED THEREFOR ONLY AT THE TIME OF FILING THE APPEAL BEFORE THE FIRST APPELLATE AUTHORITY, CAUSIN G A DELAY THEREIN BY 33 DAYS, AND WHICH, FOR THAT REASON, STOOD CONDONED BY THE L D. CIT(A) (REFER PARA 4 OF THE IMPUGNED ORDER). THIS ALSO EXPLAINS AS TO WHY THE P AN OF THE INDIVIDUAL WAS MENTIONED IN THE SALE DEED, RESULTING IN THE ASSESS MENT IN THE FIRST INSTANCE BEING MADE IN THE HANDS OF THE INDIVIDUAL. THE ASSESSMENT IN FACT, THOUGH FRAMED ON 3 ITA NO.41 /MDS/2013 (AY 2008-09) R.KARTHIKEYAN V. I TO PROTECTIVE BASIS, GETS, AS IT APPEARS, CONVERTED IN TO A SUBSTANTIVE ASSESSMENT AS THE FIRST APPELLATE AUTHORITY IN THE CASE OF THE IN DIVIDUAL HAS DELETED THE ADDITION HOLDING THAT THE IMPUGNED INCOME COULD BE ASSESSED ONLY IN THE HANDS OF THE HUF (VIDE ORDER IN APPEAL NO. 265/2010-11 DATED 21. 02.2012 / PAPER-BOOK PAGES 23-25). FURTHER, WE SAY AS IT APPEARS, AS T HERE IS NOTHING TO SHOW THAT THE SAID APPEAL IN THE CASE OF THE INDIVIDUAL, STANDS CHALLENGED BY THE REVENUE, IMPLYING ITS ATTAINING FINALITY. THE CLAIM FOR DEDU CTION U/S. 54F, WHICH WAS MADE BEFORE THE LD. CIT(A), STANDS ALSO NOT INCORRE CTLY DISALLOWED AS THE PLOT WAS PURCHASED (FOR . 12 LACS) BY THE INDIVIDUAL (REFER PARA 9 OF THE I MPUGNED ORDER). TRUE, THE NOTICE U/S .142(1) DATED 29.6.201 1, AS WELL AS THE SHOW CAUSE NOTICE DATED 18.10.2011, BEAR THE PAN OF THE INDIVI DUAL (AFQPR 6579E) (PB PAGES 31-32, 33-34). HOWEVER, IT IS CLEAR THERE-FR OM THAT THE SAME ARE ISSUED ONLY IN THE CASE OF THE ASSESSEE-HUF, AS THE CAPTIO NED SUBJECT WOULD SHOW, WITH THE NOTICE DATED 18.10.2011 ALSO BEING REFERRED TO THE EARLIER NOTICE DATED 29.06.2011. WHY, THE ASSESSEES SON, SHRI R.KARTHI KEYAN, APPEARED IN RESPONSE TO NOTICE DATED 18.10.2011, STATING (VIDE LETTER DA TED 04.11.2011) THAT HIS FATHER HAD SINCE EXPIRED, AND INASMUCH AS IT WAS HE WHO WA S LOOKING AFTER THE AFFAIRS OF AND ON BEHALF OF THE FAMILY , HE IS UNABLE TO FURNISH ANY MATERIAL IN ASSESSMENT. THE NOTICES WERE THUS, AS CLEARLY MENTI ONED THEREON, WERE IN THE CASE OF HUF AND, FURTHER, UNDERSTOOD AS SUCH. REFER ENCE IN THIS CONTEXT MAY BE MADE TO THE DECISION IN THE CASE OF CIT V. JAI PRAKASH SINGH [1996] 219 ITR 737 (SC). IT WAS IN FACT ON ACCOUNT OF THIS REASON THAT THE IMPUGNED ASSESSMENT WAS FRAMED U/S. 144 R/W S. 147, EVEN AS THE ASSUMPT ION OF JURISDICTION U/S. 144 REMAINS UNASSAILED. THE ASSESSEES CASE IS WITHOUT ANY MERIT. WITH REGARD TO THE CLAIM FOR DEDUCTION U/S. 54F, HOWEVER, IN VIEW OF T HE SUBMISSIONS MADE BEFORE US, CLAIMING THAT THE ASSESSEE-HUF SATISFIES THE CO NDITIONS OF THE PROVISION, THE MATTER IS RESTORED TO THE FILE OF THE LD. CIT(A), S O AS TO ALLOW THE ASSESSEE AN OPPORTUNITY TO SUBSTANTIATE ITS CASE. WE DECIDE ACC ORDINGLY. 4 ITA NO.41 /MDS/2013 (AY 2008-09) R.KARTHIKEYAN V. I TO 4. IN THE RESULT, THE ASSESSEES APPEAL IS PARTLY A LLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON FEBRUARY 03, 2017 AT CHENNAI . SD/- SD/- ( . ' $ %) ( ) ( G. PAVAN KUMAR ) ( SANJAY ARORA ) & / JUDICIAL MEMBER / ACCOUNTANT MEMBER / CHENNAI, 5 / DATED, FEBRUARY 03, 2017 EDN 6 0 .&278 98*2 / COPY TO: 1. ,- / APPELLANT 2. ./,- / RESPONDENT 3. $ :2 () / CIT(A) 4. $ :2 / CIT 5. 8';< .&2& / DR 6. <=) > / GF