Smt. K. Chandana, Hyderabad V. The DCIT, Central Circle - 6, Hyderabad

ITA 1372/HYD/2010

• Counselvise Citation: 137222514 RSA 2010
• Duration Of Justice: 9 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-08-2011
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 25-07-2011
• Assessment Year: 2008-2009
• Appeal Filed On: 01-11-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: V SRINIVAS
• Assessee Lawyers: C P RAMASWAMY
• Keywords: Capital asset; Cost of acquisition; Capital receipt

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A ', HYDERABAD BEFORE SHRI G.C.GUPTA, VICE PRESIDENT AND SHRI AKBER BASHA, ACCOUNTANT MEMBER ITA NO. ASSESS- MENT YEAR APPELLANT RESPONDENT 1366/HYD/2010 2008-09 SMT. A. SHOBHA, HYDERABAD (PAN AKPPA 5884 M) DY. COMMISSION- ER OF INCOME-TAX CENTRAL CIRCLE 6, HYDERABAD 1367/HYD/2010 2008-09 SMT. A. ANJAMMA HYDERABAD (PAN AKVPA 4441 N) DY. COMMISSION- ER OF INCOME-TAX CENTRAL CIRCLE 6, HYDERABAD 1369/HYD/2010 2008-09 SMT. Y.JAYAMMA, HYDERABAD (PAN AIWPJ 6888 K) DY. COMMISSION- ER OF INCOME-TAX CENTRAL CIRCLE 6, HYDERABAD 1370/HYD/2010 2008-09 SMT. A.LALITHA RANI, HYDERABAD (PAN AHDPA 8664 L) DY. COMMISSION- ER OF INCOME-TAX CENTRAL CIRCLE 6, HYDERABAD 1371/HYD/2010 2008-09 SHRI K.RAVINDER REDDY, HYDERABAD (PAN AVUPK 9660 E) DY. COMMISSION- ER OF INCOME-TAX CENTRAL CIRCLE 6, HYDERABAD 1372/HYD/2010 2008-09 SMT. K.CHANDANA, HYDERABAD (PAN AISPC 0346 H) DY. COMMISSION- ER OF INCOME-TAX CENTRAL CIRCLE 6, HYDERABAD 1373/HYD/2010 2008-09 SHRI K.NAGI REDDY, HYDERABAD (PAN AVUPK 9961 F) DY. COMMISSION- ER OF INCOME-TAX CENTRAL CIRCLE 6, HYDERABAD 1374/HYD/2010 2008-09 SHRI K.RANGA REDDY, HYDERABAD (PAN AMFPR 5916 F) DY. COMMISSION- ER OF INCOME-TAX CENTRAL CIRCLE 6, HYDERABAD 1375/HYD/2010 2008-09 SMT. K.KAVITHA, HYDERABAD (PAN AWUPK 7272 N) DY. COMMISSION- ER OF INCOME-TAX CENTRAL CIRCLE 6, HYDERABAD 1376/HYD/2010 2008-09 SMT. P.ARUNA, HYDERABAD (PANAKVPA 4442 F) DY. COMMISSION- ER OF INCOME-TAX CENTRAL CIRCLE 6, HYDERABAD ITA NO.1366/HYD/10 & 10 OTHERS SMT. A.SHOBHA & NINE OTHERS, HYDERABAD 2 1394/HYD/2010 2008 - 09 ASST. COMMISSIONER OF INCOME-TAX CENTRAL CIRCLE 6, HYDERABAD SHRI K.RANGA REDDY, HYDERABAD (PANAMFPR5916F) ASSESSEES BY : SHRI C.P. RAMASWAMY DEPARTMENT BY : SHRI V.SRINIVAS O R D E R PER G.C.GUPTA, VICE PRESIDENT: THIS IS A GROUP OF TEN APPEALS BY THE ASSESSEES A ND ONE APPEAL BY THE REVENUE. THESE APPEALS FOR THE ASSESSMENT YE AR 2008-09 ARE DIRECTED AGAINST THE SIMILAR BUT SEPARATE ORDERS OF THE COMMISSIONER OF INCOME-TAX(APPEALS). THESE ARE BEING DISPOSED OF W ITH THIS CONSOLIDATED ORDER. ASSESSEES APPEALS: 2. THE LEARNED COUNSEL FOR THE ASSESSEES, AT THE OUTSET, SUBMITTED THAT THE ASSESSEES HAVE RAISED THE FOLLOWING ADDITI ONAL GROUNDS OF APPEAL BEFORE THE CIT(A)- 1. ALL THESE ADDITIONAL GROUNDS ARE WITHOUT PREJUD ICE TO EACH OTHER AND TO THE ORIGINAL GROUNDS. 2. THE LEARNED ASSESSING OFFICER OUGHT NOT TO HAVE BROUGHT TO TAX THE SURPLUS ARISING ON SALE OF AGRICULTURAL LAND EF FECTED BY THE APPELLANT UNDER THE HEAD CAPITAL GAIN SINCE THE SUB JECT LAND IS NOT A CAPITAL ASSET WITHIN THE MEANING OF SEC.2(14) BEING LOCATED WITHIN THE JURISDICTION OF POPPALGUDA VILLA GE NEAR POPULGADA GRAM PANCHAYAT AND BEING OUTSIDE THE JURI SDICTION OF RAJENDRANAGAR MUNICIPALITY WHICH IS THE NEAREST MUNICIPALITY AS THE SAID MUNICIPALITY IS NOT NOTIFI ED UNDER SECTION 2(4)(III)(B). ITA NO.1366/HYD/10 & 10 OTHERS SMT. A.SHOBHA & NINE OTHERS, HYDERABAD 3 3. EVEN OTHERWISE THE SALE PROCEEDS RECEIVED BY VIR TUE OF SETTLEMENT BY LOK ADALAT DO NOT INDICATE THE EXTENT OF RIGHT, TITLE AND INTEREST IN THE LAND AND ITS RELATION TO THE CONSIDERATION PAID. THEREFORE, THE PROVISIONS OF SE CTION 48 IS NOT APPLICABLE TO COMPUTE THE CAPITAL GAIN AS OBSER VED BY THE ASSESSING OFFICER IN PARA 3 AND 4 OF THE ORDER. 4. EVEN ASSUMING THAT CAPITAL GAIN IS ASSESSABLE, T HE COST OF ACQUISITION IS NOT ASCERTAINABLE WITH REASONABLE CE RTAINTY TO COMPUTE CAPITAL GAIN AS COMPUTATION SECTION 48 FAIL S AND CONSEQUENTLY THERE IS NO CHARGEABLE CAPITAL GAINS A S REPEATEDLY AS HELD BY HONBLE COURTS. 5. ON THE BASIS OF HIS OWN OBSERVATION THAT APPELLA NT HAD NO RIGHT OVER THE LAND AND THERE COULD BE NO COST OF ACQUISI TION, THE LEARNED ASSESSING OFFICER OUGHT TO HAVE TREATED THE CAPITAL RECEIPTS AS NOT TAXABLE AS THE SAME DOES NOT FALL U NDER ANY HEAD OF INCOME. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ADDITIONAL GROUND OF APPEAL NO.1 RAISED BEFORE THE CIT(A) WAS GENERAL IN NATURE AND NEEDS NO ADJUDICATION. THE ADDITIONAL GROUND OF APPEAL NO.2 RAISED BEFORE THE CIT(A) WAS ADJUDICATED BY THE CIT(A) AGAINST THE A SSESSEE. HE SUBMITTED THAT THE OTHER ADDITIONAL GROUNDS OF APPEAL, VIZ. A DDITIONAL GROUNDS NO.3 , 4 AND 5 WERE NOT ADJUDICATED BY THE CIT(A), NOR ANY F INDING ON THEIR NON- ADMISSIBILITY WAS RECORDED BY THE CIT(A) AND THEREF ORE, THE WHOLE APPELLATE ORDERS OF THE CIT(A) IN THESE MATTERS MAY BE SET AS IDE TO HIS FILE FOR PASSING DE NOVO APPELLATE ORDERS BY HIM IN ACCORDANCE WITH LAW AND AFTER CONSIDERING THE ADMISSIBILITY OF THE ADDITIONAL GRO UNDS OF APPEAL NO.3 TO 5, WHICH ARE COMMON IN ALL THESE APPEALS OF THE ASSESS EE, AND TO ADJUDICATE THE SAME. 3. THE LEARNED DEPARTMENTAL REPRESENTATIVE, ON TH E OTHER HAND, OPPOSED THE SUBMISSIONS OF THE LEARNED COUNSEL FOR THE ASSESSEE AND HAS RELIED ON THE ORDERS OF THE ASSESSING OFFICER AND T HE CIT(A). 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FI ND THAT OUT OF THE ADDITIONAL GROUNDS OF APPEAL RAISED BY THE ASSE SSEE BEFORE THE CIT(A), ADDITIONAL GROUND NO.1 IS GENERAL, AND THE CIT(A) H AS ADJUDICATED UPON ONLY ITA NO.1366/HYD/10 & 10 OTHERS SMT. A.SHOBHA & NINE OTHERS, HYDERABAD 4 ADDITIONAL GROUND OF APPEAL NO.2 RAISED IN THESE AP PEALS OF THE ASSESSEES AND HAS RECORDED HIS FINDINGS, VIDE PARA-7 OF HIS O RDER IN THE CASE OF SHRI K.RAVINDER REDDY (APPELLANT IN ITA NO.1371/HYD/2010 ), WHICH WAS FOLLOWED IN OTHER APPEALS OF THE ASSESSEES, AS FOLLOWS- 07.0 DURING THE APPELLATE PROCEEDING THE APPELLANT ALSO RAISED AN ADDITIONAL GROUND STATING THAT THE ASSET TRANSFERRE D BY HIM WAS AGRICULTURAL LAND AND NOT A CAPITAL ASSET WITHIN TH E MEANING OF SEC.2(14) OF THE ACT. OTHERWISE ALSO, COMPUTATION OF CAPITAL GAIN IS NOT POSSIBLE. I DO NOT FIND FORCE IN THE ADDITIONAL GROUND RAISED BY THE APPELLANT. THE APPELLANT HAD HIMSELF SHOWN CAPITAL GAIN IN ITS RETURN OF INCOME MEANING THEREBY THAT HE HIMSELF HAD ADMIT TED THAT THE ASSET TRANSFERRED WAS A CAPITAL ASST. OTHERWISE AL SO, THERE IS NOTHING ON RECORDS TO SHOW THAT THE APPELLANT HAD IN FACT S OLD AGRICULTURAL LAND OR AGRICULTURAL OPERATION WAS BEING CARRIED ON THE SAME LAND. IN FACT, THE LAND IN WHICH THERE WERE SEVERAL CLAIM ANTS, IT IS UNIMAGINABLE THAT ONE OF THE CLAIMANTS CAN CARRY ON THE AGRICULTURAL OPERATION TO THE DETRIMENT OF OTHERS INTEREST AND O THERS WOULD BE SILENT SPECTATORS. MS. RABIYA BEGUM THE SARPANCH O F NEKNAMPURA ALONGWITH HER SON HUSNUDDIN HAD DEPOSED THAT NO AGR ICULTURAL OPERATIONS WERE CARRIED ON IN THE SAID LAND FOR LAS T SEVERAL YEARS DUE TO LITIGATION PENDING BEFORE COURTS. FURTHER THE A GRICULTURAL INCOME CLAIMED BY THE APPELLANT AND OTHER FAMILY MEMBERS W ERE NOT ACCEPTED BY THE AO IN THE ASSESSMENTS FOR A.Y. 2002 -03 TO 2007-08. IN THE SUBMISSION FILED DURING THE APPELLATE PROCEE DINGS FOR THOSE ASSESSMENT YEARS THE APPELLANT DID NOT PRESS THE IS SUE IN THE ABSENCE OF ANY FURTHER EVIDENCE IN SUPPORT OF AGRIC ULTURAL INCOME. EVEN IN THE LOK ADALAT ORDER THE APPELLANT AND/OR T HE OTHER FAMILY MEMBERS OF THE APPELLANT HAD JUST STAKED THEIR CLAI M LIKE MANY OTHERS AND IT IS FOR THE RELINQUISHMENT OF SUCH DIS PUTED RIGHT, THAT THE AMOUNTS WERE RECEIVED BY THE APPELLANT AND OTHER FA MILY MEMBERS. EVEN IN THE LOK ADALAT ORDER IT IS MENTIONED THAT T HE ORIGINAL OWNER AND PATTADAR OF THE LAND WAS MD.ALEEMUDDIN AND HIS LEGAL HEIRS. APPARENTLY, SUIT FILED BY THE APPELLANTS FATHER FO R DECLARATION OF TITLE AND PERPETUAL INJUNCTION WAS DISMISSED BY ADDL. SUB ORDINATE JUDGE, RANGA REDDY DISTRICT. THUS, CONSIDERING THE AFORESA ID FACT, I DO NOT FIND ANY SUBSTANCE IN THE ADDITIONAL GROUNDS RAISED BY THE APPELLANT. THE SAME ARE DISMISSED. HE HAS, HOWEVER, NOT DEALT WITH THE OTHER ADDITIONA L GROUNDS OF APPEAL RAISED BY THE ASSESSEE IN THESE APPEALS. IN VIEW OF THE FACT THAT THE CIT(A) HAS NOT ADJUDICATED UPON THE ADDITIONAL GROUNDS OF APPEAL NO.3, 4 AND 5 IN ANY OF THESE APPEALS OF THE ASSESSEE, NOR HAS HE RE CORDED HIS FINDINGS REGARDING ADMISSIBILITY OF THESE ADDITIONAL GROUNDS OF APPEAL NO.3 TO 5 RAISED BY THE ASSESSEE BEFORE HIM, WE ARE OF THE VI EW THAT IT SHALL BE IN THE INTERESTS OF JUSTICE TO SET ASIDE THE ISSUE TO THE FILE OF THE CIT(A) IN ALL THESE ITA NO.1366/HYD/10 & 10 OTHERS SMT. A.SHOBHA & NINE OTHERS, HYDERABAD 5 APPEALS OF THE ASSESSEE, WITH A DIRECTION TO PASS A DE NOVO APPELLATE ORDER IN ACCORDANCE WITH LAW, AFTER ALLOWING PROPER OPPOR TUNITY OF HEARING TO BOTH THE PARTIES. WE MAKE IT CLEAR THAT WE ARE SETTING ASIDE THE APPELLATE ORDERS OF THE CIT(A) IN ALL THESE APPEALS OF THE ASSESSEE S AS A WHOLE AND THE CIT(A) SHALL PASS DE NOVO APPELLATE ORDERS ON ALL THE ISSUES BEFORE HIM, AFTER RECORDING HIS FINDING ON THE ADMISSIBILITY OF THE ADDITIONAL GROUNDS OF APPEAL RAISED BEFORE HIM. WE DIRECT ACCORDINGLY. 5. IN THE RESULT ALL THE TEN APPEALS OF THE ASSESS EES ARE ALLOWED FOR STATISTICAL PURPOSES. REVENUES APPEAL (ITA NO.1394/HYD/2010) 6. ONLY GROUND OF APPEAL OF THE REVENUE IN THIS AP PEAL IS AS UNDER- 1. THE CIT(A) ERRED ON FACTS AND IN LAW IN DIRECTI NG TO ALLOW DEDUCTION U/S.54F, AFTER VERIFYING THE INVESTMENT I N PURCHASE OF LAND. 7. WE HAVE HEARD THE PARTIES. IN VIEW OF THE FACT THAT WE HAVE, WHILE DEALING WITH THE ASSESSEES APPEALS HEREINABO VE, SET ASIDE THESE MATTERS TO THE FILE OF THE CIT(A) FOR PASSING THE APPELLATE ORDERS DE NOVO, DULY ADJUDICATING UPON THE ADDITIONAL GROUNDS NO.3, 4 AND 5 RAISED BY THE ASSESSEES IN THEIR APPEALS, AFTER CONSIDERING ADMIS SIBILITY THEREOF, WE ARE OF THE VIEW THAT IT SHALL BE JUSTIFIED TO RESTORE THE ISSUE INVOLVED IN THIS REVENUE APPEAL ALSO TO THE FILE OF THE CIT(A) TO RE DECIDE THE SAME DE NOVO IN ACCORDANCE WITH LAW AFTER PROVIDING REASONABLE O PPORTUNITY OF HEARING TO BOTH THE PARTIES. WE DIRECT ACCORDINGLY. 8. IN THE RESULT, REVENUES APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. ITA NO.1366/HYD/10 & 10 OTHERS SMT. A.SHOBHA & NINE OTHERS, HYDERABAD 6 9. TO SUM UP, ALL THE ELEVEN APPEALS ARE ALLOWED F OR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE COURT ON 5.8.2011 SD/- SD/- (AKBER BASHA) (G.C.GUPTA) ACCOUNTANT MEMBER VICE PRESIDENT DT/- 5 TH AUGUST, 2011 COPY FORWARDED TO: 1. SMT. A. SHOBHA, C/O.DR.C.P.RAMASWAMY, PH.D., ADVOCATE, F.NO.303 & 102., GITANJALI, PLOT NO.108, SRINAGAR COLONY, HYDE RABAD. 2. SMT. A. ANJAMMA , C/O.DR.C.P.RAMASWAMY, PH.D., ADVOCATE, F.NO.303 & 102., GITANJALI, PLOT NO.108, SRINAGAR COLONY, HY DERABAD 3. SMT. Y.JAYAMMA, C/O.DR.C.P.RAMASWAMY, PH.D., ADVOCA TE, F.NO.303 & 102., GITANJALI, PLOT NO.108, SRINAGAR COLONY, HY DERABAD 4. SMT. A.LALITHA RANI, C/O.DR.C.P.RAMASWAMY, PH.D., ADVOCATE, F.NO.303 & 102., GITANJALI, PLOT NO.108, SRINAGAR C OLONY, HYDERABAD 5. SHRI K.RAVINDER REDDY, C/O.DR.C.P.RAMASWAMY, PH.D., ADVOCATE, F.NO.303 & 102., GITANJALI, PLOT NO.108, SRINAGAR C OLONY, HYDERABAD 6. SMT. K.CHANDANA, C/O.DR.C.P.RAMASWAMY, PH.D., ADVOCATE, F.NO.303 & 102., GITANJALI, PLOT NO.108, SRINAGAR COLONY, HY DERABAD 7. SHRI K.NAGI REDDY, C/O.DR.C.P.RAMASWAMY, PH.D., ADVOCATE, F.NO.303 & 102., GITANJALI, PLOT NO.108, SRINAGAR C OLONY, HYDERABAD 8. SHRI K.RANGA REDDY, C/O.DR.C.P.RAMASWAMY, PH.D., AD VOCATE, F.NO.303 & 102., GITANJALI, PLOT NO.108, SRINAGAR C OLONY, HYDERABAD 9. SMT. K.KAVITHA , C/O.DR.C.P.RAMASWAMY, PH.D., ADVOCATE, F.NO.303 & 102., GITANJALI, PLOT NO.108, SRINAGAR COLONY, HYDERABAD 10. SMT. P.ARUNA, C/O.DR.C.P.RAMASWAMY, PH.D., ADVOCAT E, F.NO.303 & 102., GITANJALI, PLOT NO.108, SRINAGAR COLONY, HYDE RABAD 11. DY. COMMISSIONER OF INCOME-TAX CENTRAL CIRCLE 6, HY DERABAD 12. ASSTT. COMMISSIONER OF INCOME - TAX CENTRAL CIRCLE 6, HYDERABAD 13. COMMISSIONER OF INCOME-TAX(APPEALS)-I, HYDERABAD 14. COMMISSIONER OF INCOME - TAX (CENTRAL), HYDERABAD 15. DEPARTMENTAL REPRESENTATIVE, ITAT, HYDERABAD B.V.S.