M/s. Fabsun Engineering Pvt. Ltd., Bangalore V. Income Tax Officer, Bangalore

ITA 1213/BANG/2010

• Counselvise Citation: 121321114 RSA 2010
• Duration Of Justice: 11 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-10-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 20-10-2011
• Assessment Year: 1998-1999
• Appeal Filed On: 08-11-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KUMAR AJEET JT
• Assessee Lawyers: V CHANDRASHEKAR
• Keywords: Retrospective amendment
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH : BANGALORE BEFORE SHRI N.K. SAINI, ACCOUNTANT MEMBER AND SMT. P. MADHAVI DEVI, JUDICIAL MEMBER ITA NO.1213/BANG/2010 ASSESSMENT YEAR : 1998-99 M/S. FABSUN ENGINEERING PVT. LTD., NO.A-2, KASTEL, NO.5, CORNWELL ROAD, BANGALORE 560 025. PAN : AAACF 2575Q VS. THE INCOME TAX OFFICER, WARD 11(2), BANGALORE. APPELLANT RESPONDENT APPELLANT BY : SHRI V. CHANDRASHEKAR, ADVOCATE RESPONDENT BY : SHRI KUMAR AJEET, JT.CIT(DR) DATE OF HEARING : 20.10.2011 DATE OF PRONOUNCEMENT : 31.10.2011 O R D E R PER N.K. SAINI, ACCOUNTANT MEMBER THIS APPEAL BY THE ASSESSEE IS AGAINST THE ORDER DATED 26.8.2010 OF THE CIT(APPEALS)-I, BANGALORE. 2. THE ASSESSEE HAS RAISED AS MANY AS 7 GROUNDS AND THE MAIN GRIEVANCE VIDE GROUND NO.2 RELATES TO THE GROUNDS W HICH WERE NOT DECIDED ITA NO.1213/BANG/2010 PAGE 2 OF 4 BY THE LD. CIT(APPEALS) QUESTIONING THE ASSESSING O FFICERS DECISION TO TREAT THE CAPITAL GAIN AS SHORT TERM CAPITAL GAINS. 3. THE FACTS OF THE CASE IN BRIEF ARE THAT THE ASSE SSMENT IN THIS CASE WAS COMPLETED ON 16.8.2004 U/S. 143(3) R.W.S. 147 O F THE INCOME-TAX ACT, 1961 [HEREINAFTER REFERRED TO AS THE ACT IN SHORT ]. THE ASSESSEE SOLD THE PROPERTY AT 47E, BOMMASANDRA INDUSTRIAL AREA, ANEKA L, BANGALORE, WHICH WAS CONSIDERED AS SHORT TERM CAPITAL GAIN AND ASSES SED AS SUCH AFTER ARRIVING AT THE SHORT TERM CAPITAL GAIN OF B 85,11,648. FURTHER, THE ASSESSEE WAS NOT ALLOWED EXEMPTION U/S. 54(G) OF TH E ACT. AGAINST THE SAID ORDER, THE ASSESSEE PREFERRED AN APPEAL TO THE LD. CIT(APPEALS), WHO CONFIRMED THE ACTION OF THE AO. AGAINST THE SAID O RDER OF THE LD. CIT(A), THE ASSESSEE PREFERRED APPEAL TO THE ITAT IN ITA NO.848 /BANG/2006 WHEREIN VIDE ORDER DATED 26.10.2007, THE ASSESSMENT ORDER D ATED 16.8.2004 WAS SET ASIDE AND THE MATTER WAS RESTORED TO THE AO. 4. ON THE DIRECTION OF THE ITAT, THE ASSESSING OFFI CER DECIDED THE MATTER AFRESH, BUT TOOK THE SAME VIEW BY OBSERVING THAT SEVERAL OPPORTUNITIES WERE GIVEN TO THE ASSESSEE TO FURNISH DOCUMENTARY EVIDENCE TO THE EFFECT THAT NOTIFICATION DATED 27.4.2006 ISS UED BY THE CBDT HAD RETROSPECTIVE EFFECT, BUT WAS NOT FURNISHED. THE A SSESSEE CARRIED THE MATTER TO THE LD. CIT(A), WHO CONFIRMED THE ACTION OF THE AO BY OBSERVING AS UNDER: THIS IS SECOND ROUND OF APPEAL AFTER THE HONORAB LE ITAT RESTORED THE ASSESSMENT TO AO AT THE BEHEST OF THE HONORABLE HIGH COURT OF KARNATAKA IN ITA NO.948/BANG/2006 DATED 26.10.2007 ITA NO.1213/BANG/2010 PAGE 3 OF 4 DIRECTING THE AO TO PROVIDE ONE MORE OPPORTUNITY TO THE ASSESSEE TO SHOW PROOF THAT THE BANGALORE URBAN AND RURAL DI STRICT HAD BEEN NOTIFIED U/.S 54G OF I.T. ACT WITH RETROSPECTI VE EFFECT BY THE CENTRAL BOARD OF DIRECT TAXES, NEW DELHI SO THAT TH E CLAIM OF DEDUCTION OF RS.78,65,256/- U/S. 54G OF I.T. ACT BY THE APPELLANT BE ALLOWED. NEITHER AT THE ASSESSMENT STAGE NOR AT APPELLATE STAGE NOW THE AR OF THE APPELLANT SRI NARESH D. SHETTY, C .A. HAS BEEN ABLE TO SHOW THAT THE NOTIFICATION NO.SO 691(I) DAT ED 27-4-2006 HAS BEEN AMENDED TO HAVE RETROSPECTIVE EFFECT SO AS TO BE APPLICABLE TO FACTS OF AY 1998-99, THE A.Y. INVOLVE D IN THIS CASE. 5. NOW THE ASSESSEE IS IN APPEAL. WE HAVE CONSIDER ED THE SUBMISSIONS OF BOTH THE PARTIES AND CAREFULLY GONE THROUGH THE MATERIAL AVAILABLE ON RECORD. IN THE INSTANT CASE, IT IS NOT ICED THAT THE LD. CIT(A) CONFIRMED THE ACTION OF THE AO FOR THE REASON THAT THE ASSESSEE HAD NOT FURNISHED COPY OF NOTIFICATION ISSUED BY THE CBDT E ITHER BEFORE THE AO OR BEFORE HIM IN THE FIRST ROUND. IT ALSO APPEARS THA T THE ASSESSEE HAD FURNISHED COPY OF NOTIFICATION NO.691(I) DATED 27.4 .2006 BEFORE THE LD. CIT(APPEALS), BUT HE HAD NOT COMMENTED UPON THAT NO TIFICATION AND HAD ALSO NOT CONSIDERED THE SAME WHILE DECIDING THE APP EAL OF THE ASSESSEE. WE THEREFORE DEEM IT APPROPRIATE TO SET ASIDE THE I MPUGNED ORDER PASSED BY THE LD. CIT(APPEALS) AND RESTORE THE MATTER TO T HE ASSESSING OFFICER TO BE ADJUDICATED AFRESH BY CONSIDERING THE RELEVANT N OTIFICATION ISSUED BY THE CBDT WHICH WAS FURNISHED BEFORE THE LD. CIT(A). IT IS ALSO RELEVANT TO POINT OUT THAT THE AO HIMSELF IN THE ASSESSMENT ORDER DAT ED 31.12.2008 HAS OBSERVED AS UNDER: HOWEVER, SUBJECT TO PRODUCTION OF THE SAID DOCUMEN TARY EVIDENCE VIZ BOARDS NOTIFICATION THE ORDER WILL BE MODIFIED ACCORDINGLY, IF IT IS FOUND NECESSARY. ITA NO.1213/BANG/2010 PAGE 4 OF 4 FROM THE ABOVE OBSERVATION, IT APPEARS THAT THE COP Y OF THE SAID NOTIFICATION WAS NOT AVAILABLE TO THE AO, THAT IS W HY THE SAME VIEW WAS TAKEN BY HIM AS WAS TAKEN IN THE ORIGINAL ASSESSMEN T ORDER DATED 16.8.2004. 6. IN VIEW OF THE ABOVE DISCUSSION, THE MATTER IS R ESTORED BACK TO THE FILE OF ASSESSING OFFICER TO BE ADJUDICATED AFRESH IN ACCORDANCE WITH THE LAW AFTER PROVIDING DUE AND REASONABLE OPPORTUNITY OF B EING HEARD TO THE ASSESSEE. 7. IN THE RESULT, THE APPEAL IS ALLOWED FOR STATIST ICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON THIS 31 ST DAY OF OCTOBER, 2011. SD/- SD/- ( SMT. P. MADHAVI DEVI ) ( N.K. SAINI ) JUDICIAL MEMBER ACCOUNTANT MEMBER BANGALORE, DATED, THE 31 ST OCTOBER, 2011. DS/- COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT, BANGALORE. 6. GUARD FILE (1+1) BY ORDER ASSISTANT REGISTRAR ITAT, BANGALORE.