ITO, Ooty V. M/s. Glenburn Estates & Enterprises Pvt Ltd., Nilgiris

ITA 1354/CHNY/2010

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 51648 (ITAT-CHENNAI)
• Duration Of Justice: 11 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-08-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 02-08-2011
• Assessment Year: 2007-2008
• Appeal Filed On: 16-08-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: R MEENAKSHISUNDARAM

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL BENCH A CHENNAI BEFORE DR. O.K. NARAYANAN, VICE-PRESIDENT AND SHRI GEORGE MATHAN, JUDICIAL MEMBER I.T.A.NO. 1354/MDS/2010 ASSESSMENT YEAR : 2007-08 THE INCOME-TAX OFFICER, WARD I(2), INCOME-TAX OFFICE, OOTY. VS. M/S.GLENBURN ESTATES & ENTERPRISES PVT. LTD., KUNJAPANNAI, KOTAGIRI, NILGIRIS - 643 242 PAN AABCG 1009 K (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI SHAJI P. JACOB , SR. DR RESPONDENT BY : SHRI R. MEENAKSHISUNDARAM, ADVOCAT E O R D E R PER DR. O.K. NARAYANAN, VICE-PRESIDENT THIS APPEAL IS FILED BY THE REVENUE. THE RELEVANT ASSESSMENT YEAR IS 2007-08. THE APPEAL IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX(APPEALS)-I, AT COIMBATORE DATED 9.6.2010. THE APPEAL ARISES OUT O F THE ASSESSMENT COMPLETED UNDER SEC.143(3) OF THE INCOME -TAX ACT, 1961. ITA 1354/10 :- 2 -: 2. THERE WAS AN AMOUNT OF ` 13,02,305/- REFLECTED AS ADVANCES RECEIVED IN THE BALANCE SHEET OF THE ASSES SEE-COMPANY AS ON 31.3.2007. THE ADVANCES WERE STATED TO BE RE CEIVED AGAINST AN AGREEMENT TO SELL THE AGRICULTURAL LANDS AND THE TOTAL AMOUNTS WERE RECEIVED FROM 10 DIFFERENT PARTIES. I T WAS ALSO EXPLAINED THAT THE ADVANCES WERE RECEIVED ON THE BA SIS OF SALE AGREEMENTS ENTERED INTO IN YEARS 1977 AND 1978 FOR THE SALE OF 156.62 ACRES OF AGRICULTURAL LAND. 3. THE ASSESSING AUTHORITY, IN THE ASSESSMENT ORDER OBSERVED THAT THE ACTUAL SALE OF THE AGRICULTURAL LANDS WAS NOT TAKEN PLACE AS PER THE AGREEMENTS BY EXECUTING THE SALE DEED, A ND IN SUCH CIRCUMSTANCES, THESE ADVANCES SHOULD BE TAKEN AS IN COME OF THE ASSESSEE. ACCORDINGLY, THE SUM OF ` 13,02,305/- WAS ADDED AS INCOME IN THE HANDS OF THE ASSESSEE-COMPANY. 4. IN FIRST APPEAL, THE COMMISSIONER OF INCOME-TAX( APPEALS) HELD THAT EVEN IF THE AMOUNT OF ` 13,02,305/- WAS TAKEN AS INCOME OF THE ASSESSEE, IT SHOULD BE TREATED AS AGRICULTUR AL INCOME IN NATURE AS IT AROSE OUT OF THE PROPOSED SALE OF AGRI CULTURAL LANDS. THE FIRST APPEAL HAS BEEN ALLOWED. THE REVENUE IS AGGRIEVED AND, THEREFORE, THE SECOND APPEAL BEFORE US. 5. WE HEARD SHRI SHAJI P. JACOB, THE LEARNED COMMIS SIONER APPEARING FOR THE REVENUE AND SHRI R.MEENAKSHISUNDA RAM, THE LEARNED COUNSEL APPEARING FOR THE RESPONDENT-ASSESS EE. ITA 1354/10 :- 3 -: 6. WE ARE CONCERNED WITH THE ASSESSMENT YEAR 2007-0 8. THE ADVANCES WERE RECEIVED BY THE ASSESSEE ON THE BASIS OF AGREEMENTS ENTERED INTO IN THE YEARS 1977 AND 1978. THEREFORE, THE ADVANCES RELATED TO THE ASSESSMENT YEARS RELEVA NT TO THOSE FINANCIAL YEARS OF 1977 AND 1978. THE CREDITS REFL ECTED FOR THOSE EARLIER ASSESSMENT YEARS CANNOT BE TAKEN AS THE INC OME OF THE IMPUGNED ASSESSMENT YEAR 2007-08. THE LANGUAGE EMP LOYED IN THE DEEMING PROVISION OF SEC.68 DOES NOT ENABLE THE ASSESSING OFFICER TO BRING TO TAX ANY CREDITS OF EARLIER ASSE SSMENT YEARS IN SUBSEQUENT ASSESSMENT YEARS. WE FIND THAT THE ADDI TION MADE BY THE ASSESSING AUTHORITY IS NOT SUSTAINABLE IN LAW F OR THE SHORT REASON STATED ABOVE. 7. IN RESULT, THE APPEAL FILED BY THE REVENUE IS DI SMISSED. ORDER PRONOUNCED ON WEDNESDAY, THE 3 RD DAY OF AUGUST, 2011 AT CHENNAI. SD/- SD/- (GEORGE MATHAN) (DR.O.K.NARAYANAN) JUDICIAL MEMBER VICE-PRESIDENT CHENNAI, DATED THE 3 RD AUGUST, 2011 MPO* COPY TO : APPELLANT/RESPONDENT/CIT/CIT(A)/DR