Miryala Exports & Imports Private Limited , Hyderabad V. Income Tax Officer, Ward-16(4), Hyderabad

ITA 1210/Hyd/2019

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 2502 (ITAT-HYDERABAD)
• Duration Of Justice: 1 year(s) 3 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-11-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 31-07-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Sale consideration of property below Jantri Value; Opportunity of being heard; Cost of acquisition; Capital Gains
• Section: 50C; 201; 48; 13; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES A - SMC : HYDERABAD BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER (THROUGH VIRTUAL CONFERENCE) I.T.A. NO . 1 2 10 /HYD/201 9 ASSESSMENT YEAR: 20 11 - 12 MIRYALA EXPORTS & IMPORTS PVT. LTD., HYDERABAD. PAN A A C CM9283E VS INCOME - TAX OFFICER, WARD 1 6 ( 4 ) , HYDERABAD. (APPELLANT) (RESPONDENT) DATE OF HEARING : 23 - 1 1 - 20 20 DATE OF PRONOUNCEMENT : 25 - 1 1 - 20 20 O R D E R TH IS IS AN APPEAL OF THE ASSESSEE FOR THE AY 201 2 - 13 AGAINST THE ORDER OF CIT(A) 4 , HYDERABAD , DATED 1 9 / 06/2019. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE FIRM HAD NOT FILED ITS RETURN OF INCOME FOR THE AY 2011 - 12. THE AO RECEIVED INFORMATION THAT THE ASSESSEE HAD SOLD AN IMMOVABLE PROPERTY ON 31/12/2010 VIDE DOCUMENT NO. 3879/2010 FOR RS. 5,00,000/ - WHEREAS THE VALUE OF THE SAID PROPERTY AS PER THE SRO IS RS. 50 LAKHS. THEREFORE, A NOTICE U/S 148 OF THE ACT WAS ISSUED TO THE FOR ASSESSEE : SHRI P. MURALI MOHANA RAO FOR REVENUE : SHRI SUNIL KUMAR PANDEY ITA NO. 1210 /HY D/201 9 MIRYALA EXPORTS & IMPORTS PVT. LTD., HYDERABAD. : - 2 - : ASSESSEE, IN RESPONSE TO WHICH, THE ASSESSEE FILED ITS RETURN OF INCOME ON 09/05/2018 ADMITTING NIL INCOME. THEREAFTER, THOUGH, NOTICES WERE ISSUED TO THE ASSESSEE, NONE APPEARED FOR THE ASSESSEE. THEREFORE, THE AO PROCEEDED TO COMPUTE LONG TERM CAPITAL GAINS (LTGC) BY APPLYING PROVISIONS OF SECTION 50C OF THE ACT AND DID NOT ALLOW COST OF ACQUISITION AND IMPROVEMENTS FOR LACK OF EVIDENCE. 3. AGGRIEVED, THE ASSESSEE FILED AN APPEAL BEFORE THE CIT(A), BUT, DID NOT APPEAR BEFORE HIM NO R FILED ANY EVIDENC E. THE REFORE, THE CIT(A) CONFIRMED THE ASSESSMENT ORDER AND THE ASSESSEE IS IN SECOND APPEAL BEFORE THE TRIBUNAL BY RAISING THE FOLLOWING GROUNDS OF APPEAL: 1. THE ORDER OF THE LD. CIT(A) IS ERRONEOUS BOTH ON FACTS AND IN LAW. 2. THE LD. CIT (A) ERRED IN DISMISSING THE APPEAL. 3. THE LD. CIT (A) OUGHT TO HAVE APPRECIATED THAT THE ASSESSMENT UL S 147 R.W.S. 144 OF THE ACT HAS BEEN MADE WITHOUT GIVING A REASONABLE OPPORTUNITY OF BEING HEARD TO THE A PP ELLANT. 4. THE LD. CIT (A) ERRED IN NOT ADJUDICATING GROUND NOS.5, 6, 7 & 10 TAKEN BEFORE HIM. 5. THE LD. CIT(A) OUGHT TO HAVE APPRECIATED THAT THERE IS NO ACTUAL TRANSFER OF THE IMPUGNED PROPERTY AND THAT THERE IS NO CONSIDERATION RECEIVED IN THIS RE GARD. 6. THE LD. CIT(A) OUGHT TO HAVE APPRECIATED THAT SINCE THE SALE AGREEMENT IS N OT FRUCTIFIED, THERE IS NO TRANSFER WITHIN THE MEANIN G OF SECTION 2(4 7) OF THE ACT. ITA NO. 1210 /HY D/201 9 MIRYALA EXPORTS & IMPORTS PVT. LTD., HYDERABAD. : - 3 - : 7. THE LD. CIT (A) OUGHT TO HAVE APPRECIATED THAT THE VERY OWNERSHIP OF THE IMPUGNED LAND IS IN DISPUTE AS THE GOVERNMENT HAS ALLOTTED THE LAND TO THE LANDLESS POOR PEOPL E IN WHOSE P H Y SICAL P OSSESSION THE LAND IS AT RESENT. 8. WITHOUT PREJUDICE TO OTHER GROUNDS, THE LD. CIT (A) OUGHT TO HAVE APPRECIATED THAT NO COST OF ACQUISITION HAS BEEN CONSIDERED BY THE ASSESSING OFFICER WHILE COMPUTING THE CAPITAL GAINS U / S 48 OF TH E ACT. 9. WITHOUT PREJUDICE TO OTHER GROUNDS, THE LD. CIT(A) OUGHT TO HAVE APPRECIATED THAT THE ASSESSING OFFICER VIOLATED THE PROVISIONS OF SECTION 5 OC(2) OF THE ACT. 10. THE APPELLANT MAY, ADD OR ALTER OR AMEND OR MODIFY OR SUBSTITUTE OR DELETE AND I OR RESCIND ALL OR ANY OF THE GROUNDS OF APPEAL AT ANY TIME BEFORE OR AT THE TIME OF HEARING OF THE APPEAL. 11. THE AO OUGHT TO HAVE APPRECIATED THE FACT THAT GOVERNMENT HAS IMPOSED PROHIBITION ON TRANSFER OF THESE LANDS UNDER SECTION 22A OF REGISTRATI ON ACT AND DIRECTED CONCERNED MRO AND SUB REGISTRARS NOT TO ENTERTAIN REGISTRATION. 12. WITHOUT PREJUDICE, THE AO ERRED IN MAKING AN ADDITION OF RS.7,14,286/ - U/S 5 OC OF THE ACT TOWARDS DIFFERENCE IN SALE CONSIDERATION MENTIONED IN THE AGREEMENT AND THE VALUE ADOPTED BY THE SRO, WITHOUT APPRECIATING THE FACT THAT SRO VALUE CANNOT BE CONSIDERED AS BASIS FOR MAKING ADDITION U /S 5 OC OF THE ACT. 4. THE LD. COUNSEL FOR THE ASSESSEE SUB MITTED THAT THE ASSESSEE MAY BE GIVEN AN OPPORTUNITY TO PRESENT ITS CASE BEFORE THE AO AS BOTH THE ASSESSMENT AS WELL AS APPELLATE ORDERS ARE EX - PARTE THE ASSESSEE. 5. THE LD. DR, HOWEVER, OPPOSED THE REMAND STATING THAT THE AUTHORITIES BELOW HAVE GIVEN SUFFICIENT OPPORTUNITY TO THE ASSESSEE. ITA NO. 1210 /HY D/201 9 MIRYALA EXPORTS & IMPORTS PVT. LTD., HYDERABAD. : - 4 - : 6. HAVING REGARD TO THE RIVAL CONTENTIONS AND MATERIAL ON RECORD, I FIND THAT THE ASSESSMENT WAS COMPLETED U/S 144 BY APPLYING THE PROVISIONS OF SECTION 50C OF THE ACT AND EVEN COST OF ACQUISITION HAS NOT BEEN ALLO WED TO THE ASSESSEE WHILE COMPUTING LTCG. B EFORE THE CIT(A) , THE ASSESSEE HAD EXPLAINED IN DETAIL THAT THE ASSESSEE HAS NOT RECEIVED ANY AMOUNT IN EXCESS OF AMOUNT ADMITTED BY THE ASSESSEE AS IT WAS AGRICULTURAL LAND, WHICH WAS ASSIGNED BY WAY OF DECREE OF HONBLE AP HIGH COURT BECAUSE OF MUTATION AND THAT THE GOVERNMENT HAS IMPOSED PROHIBITION ON THESE LANDS U/S 22A OF REGISTRATION ACT AND DIRECTED CONCERNED MRO/SRO NOT TO ENTERTAIN REGISTRATION S . THE CIT(A) HAS NOT DECIDED THE APPEAL ON MERITS, BUT, HAS DISMISSED THE APPEAL FOR NON - APPEARANCE OF THE ASSESSEE. THOUGH, THE CIT(A) MENTIONED THAT NUMBER OF OPPORTUNITIES WERE GIVEN AND THE ASSESSEE WAS ABSENT , HE HAS NOT RECORDED THE DATES OF HEARING ON WHICH THE ASSESSEE DID NOT APPEAR. AS PER THE FORM NO. 3 5, THE APPEAL WAS FILED ON 29/01/2019 AND THE ORDER OF CIT(A) I S DATED 19/06/2019. THEREFORE, I AM OF THE OPINION THAT IN THE INTEREST OF JUSTICE, ASSESSEE SHOULD BE GIVEN ANOTHER OPPORTUNITY TO PRESENT ITS CASE. IN VIEW OF THE SAME, I REMIT THE ISSUE TO THE FILE OF THE AO WITH A DIRECTION TO RECONSIDER THE ISSUE DE - NOVO IN ACCORDANCE WITH LAW. THE ASSESSEE IS DIRECTED TO PRODUCE ALL THE RELEVANT ITA NO. 1210 /HY D/201 9 MIRYALA EXPORTS & IMPORTS PVT. LTD., HYDERABAD. : - 5 - : MAT ERIAL BEFORE THE AO TO SUBSTANTIATE ITS CASE AND COOPERATE WITH HIM FOR EARLY COMPLETION OF THE ASSESSMENT. 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER P RONOUNCED IN THE OPEN COURT ON 25 TH NOVEMBER , 20 20 . SD/ - ( P. MADHAVI DEVI ) JUDICIAL MEMBER HYDE RABAD, DATED : NOVEMBER , 20 20 . KV COPY TO : 1. M/S MIRYALA EXPORTS & IMPORTS PVT. LTD., C/O P. MURALI & CO., CAS, 6 - 3 - 655/2/3, 1 ST FLOOR, SOMAJIGUDA, HYDERABAD 82 2. IT O, WARD 1 6 ( 4 ), HYDERABAD. 3 . CIT(A PPEALS ) - 4 , HYDERABAD . 4 . PR. CIT 4 , HYDERABAD. 5 . D.R. ITAT, HYDERABAD.