Shri Arvindsinh Jashvantsinh Vaghela, Gandhinagar V. The ITO, Ward-1, Gandhinagar

ITA 1419/AHD/2017

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 0599 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 9 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-03-2020
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Next Hearing Date: 11-05-2020
• Assessment Year: 2014-2015
• Appeal Filed On: 09-06-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: LALIT JAIN
• Section: 54B; 2(14); 13

Judgement Text

, . . , IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, AHMEDABAD BEFORE SHRI SANDEEP GOSAIN, JUDICIAL MEMBER AND SHRI AMARJIT SINGH, ACCOUNTANT MEMBER ./I.T.A. NO. 1419/AHD/2017 ( / ASSESSMENT YEAR : 2014-15) ARVINDSINH JASHVANTSINH VAGHELA 27, VACHLO VAS LEKAWADA GANDHINAGAR 382 016 / VS. THE ITO WARD 1 GANDHINAGAR ./ ./PAN/GIR NO. : AOQPV 5900 E ( /APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY : NONE / RESPONDENT BY : SHRI LALIT JAIN, SR.DR /DATE OF HEARING 11/03/2020 / DATE OF PRONOUNCEMENT 13 / 0 3 /20 20 / O R D E R PER SHRI SANDEEP GOSAIN, JUDICIAL MEMBER : THE CAPTIONED APPEAL HAS BEEN FILED AT THE INSTAN CE OF THE ASSESSEE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TA X (APPEALS) GANDHINAGAR [CIT(A) IN SHORT] VIDE APPEAL NO.CIT(A) /GNR/302/2016-17 DATED 28/04/2017 ARISING IN THE ASSESSMENT ORDER PASSED UNDER S.143(3) OF THE INCOME TAX ACT, 1961(HEREINAFTER REFERRED TO AS 'TH E ACT') DATED 26/07/2016 RELEVANT TO ASSESSMENT YEAR (AY) 2014-15. ITA NO.1419/AHD/2017 ARVINDSINH J.VAGHELA VS. ITO ASST.YEAR 2014-15 - 2 - 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL:- WE STATE THE GROUND OF APPEAL AS UNDER ARE WITHOUT PREJUDICE TO ONE ANOTHER. THESE ARE ALTERNATE GROUNDS AND ONE GROUN D MAY BE TREATED AS INDEPENDENT OF OTHERS. 1. SECTION 54B READ WITH 2(14) THE LD.A.O. MADE ADDITION TREATING AGRICULTURAL LAN D AS NON-AGRICULTURAL LAND AND REJECTED DEDUCTION CLAIMED UNDER SECTION 5 4B OF I.T.ACT, 1961. THE SOLD LAND WAS CONVERTED INTO NON-AGRICULTURE LA ND BEFORE REGISTRATION OF DEED IN FAVOR OF THE BUYER IMMEDIAT ELY BEFORE TRANSFER. BUT THE SAID PIECE OF LAND WAS AGRICULTURAL LAND ON LY AND THE ASSESSEE CLAIMED DEDUCTION UNDER SECTION 54B. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN HOLDI NG THAT LD.AO IS CORRECT AND JUSTIFIED ERRED IN DISMISSING THE GROUN D. 3. ON THE LAST DATE OF HEARING, I.E. ON 05/02/2 020, DIRECTIONS WERE GIVEN TO THE ASSESSEE TO FILE FRESH PAPER-BOOK WITH DUE CERT IFICATION. IN THIS RESPECT, THE COUNSEL FOR THE ASSESSEE HAD PUT SIGNATURE ON T HE ORDER SHEET. TODAY, THE CASE WAS FIXED FOR HEARING BUT NONE APPEARED ON BEHALF OF ASSESSEE NOR ANY ADJOURNMENT APPLICATION HAS BEEN FILED ON RECOR D IN SPITE OF CALLS. THIS APPEAL PERTAINS TO THE YEAR OF 2017 AND NO USEFUL P URPOSE SHALL BE SEVERED BY KEEPING THE SAME PENDING. 4. THE LD.DR PRESENT IN THE COURT IS READY WITH T HE ARGUMENTS, THEREFORE WE PROCEED TO DECIDE THE APPEAL ON MERITS EX-PARTE QUA THE ASSESSEE, AFTER HEARING THE LD.DR. ITA NO.1419/AHD/2017 ARVINDSINH J.VAGHELA VS. ITO ASST.YEAR 2014-15 - 3 - 5. THE SOLITARY GROUND RAISED BY THE ASSESSEE RELAT ES TO CHALLENGING THE ORDER OF THE LD.CIT(A) IN UPHOLDING THE DISALLOWANC E OF DEDUCTION MADE BY THE ASSESSING OFFICER U/S.54B OF THE ACT. 6. WE HAVE HEARD THE LD.DR AND PERUSED THE MATERIA L PLACED ON RECORD AS WELL AS THE ORDERS PASSED BY THE REVENUE AUTHORI TIES. THE LD.CIT(A) DEALT WITH THIS GROUND IN PARA-6 OF HIS ORDER WHICH IS RE PRODUCED HEREUNDER: 6. I HAVE CAREFULLY CONSIDERED ASSESSMENT ORDER AND SUBMISSION FILED BY APPELLANT. THE UNDISPUTED FACTS OF THE PRESENT CAS E ARE THAT APPELLANT WAS HOLDING 1/4 TH SHARE IN AGRICULTURE LAND SITUATED AT VILLAGE LEKA WADA AND RECEIVED RS.14,00,000/-. APPELLANT HAS CLAIMED COM PUTED LONG TERM CAPITAL GAIN AND CLAIMED EXEMPTION U/S.54B OF THE ACT FOR R S.2,25,750/-. THE AO OBSERVED THAT LAND WAS SOLD TO SHIOM BUIDTECH PVT L IMITED AND BEFORE THE SALE; AGRICULTURE LAND WAS CONVERTED INTO NA LAND. THE AO OBSERVED THAT APPELLANT HAS FAILED TO PROVE THAT LAND WAS USED AS AGRICULTURE LAND FOR TWO YEARS PRIOR TO DATE OF SALE HENCE HE DENIED DEDUCTI ON U/S 54B OF THE ACT. ON THE OTHER HAND, APPELLANT ARGUED THAT LAND WAS. ANC ESTRAL AND APPELLANT'S FAMILY BEING INVOLVED IN FARMING ACTIVITY, USED LAN D AS AGRICULTURE LAND. APPELLANT ALSO CLAIMED THAT NA WAS CARRIED OUT BY B UILDER AS AGRICULTURE LAND CANNOT BE OWNED BY PVT LIMITED COMPANY. ON CAREFUL CONSIDERATION OF ENTIRE FACTS, IT IS OBS ERVED THAT PROVISIONS OF SECTION 54B CLEARLY STATES THAT ASSESSEE HAS TO PRO VE THAT LAND SOLD WAS USED FOR AGRICULTURE PURPOSE FOR AT LEAST TWO YEARS PRIO R TO ITS SALE. IT IS OBSERVED THAT APPELLANT HAS NOT SUBMITTED ANY PROOF EITHER D URING ASSESSMENT PROCEEDINGS OR IN APPELLATE PROCEEDINGS WHICH CAN P ROVE THAT AGRICULTURE ACTIVITY WAS CARRIED OUT IN THE LAST TWO YEARS PRIO R TO DATE OF SALE. APPELLANT HAS ALSO NOT SUBMITTED COPIES OF RETURN OF INCOME F OR CURRENT ASSESSMENT YEAR AS WELL AS IMMEDIATE PRECEDING TWO YEARS (EXCE PT COMPUTATION OF CAPITAL GAIN AT PAGE 17 OF PB) WHEREIN AGRICULTURE INCOME P ERTAINING TO ABOVE LAND IS REFLECTED. APPELLANT HAS ALSO NOT SUBMITTED 7/12 EX TRACTS OR 8 EXTRACT OR AGRICULTURE SALE BILLS WHICH CAN PROVE THAT LAND WA S USED FOR AGRICULTURE LAND. APPELLANT HAS ONLY ARGUED THAT NA WAS CARRIED OUT B Y THE BUILDER. HOWEVER, NO DOCUMENTARY EVIDENCES FOR CARRYING OUT AGRICULTU RE OPERATIONS WERE SUBMITTED. THE SALE DEED SUBMITTED BY APPELLANT CLE ARLY STATES THAT APPLICATION OF CONVERTING AGRICULTURE LAND INTO NA LAND WAS MADE BY APPELLANT ITA NO.1419/AHD/2017 ARVINDSINH J.VAGHELA VS. ITO ASST.YEAR 2014-15 - 4 - ON 27/09/2013 HENCE IT IS NOT PROVED THAT NA WAS MA DE BY BUILDER NOR PROVE THAT LAND WAS IN FACT USED FOR AGRICULTURE PURPOSE PRIOR TO SUCH APPLICATION. IT IS MATTER OF FACT THAT AS ON THE DA TE OF SALE, LAND WAS NA LAND AND APPELLANT HAS NOT PROVED ONE OF THE VITAL CONDI TIONS FOR CLAIMING DEDUCTION U/S 54B THAT LAND WAS USED FOR AGRICULTUR E PURPOSE. THE APPELLANT HAS RELIED UPON DECISION OF HON'BLE HYDERABAD ITAT IN THE CASE OF DCIT V/S M. KALYAN CHAKARAVARTHY (REFERRED SUPRA) WHEREIN TH E COURT HAS HELD THAT IF AGRICULTURE LAND SOLD BY ASSESSEE WILL BE UTILISED BY BUYER FOR NON AGRICULTURE PURPOSE WOULD NOT MEAN THAT APPELLANT IS NOT ENTITL ED TO DEDUCTION U/S 54B OF THE ACT. BUT IN THE PRESENT CASE, AO HAS NOT RAISED J ANY DOUBT ON IT BUT ONLY OBSERVATION OF AO THAT APPELLANT HAS FAILED TO PROV E AGRICULTURE ACTIVITY CARRIED OUT IN ABOVE LAND PRIOR TO ITS SALE. IT IS OBSERVED THAT IN THE CASE BEFORE HON'BLE HYDERABAD ITAT, APPELLANT HAD PROVED THAT LAND WAS USED FOR AGRICULTURE PURPOSE AND EVEN AO ADMITTED THAT FACT WHEREAS IN PRESENT CASE, SUCH BASIC CONDITIONS ARE NOT FULFILLED BY THE APPE LLANT BY COGENT EVIDENCES AS STATED SUPRA, HENCE DECISION OF HON'BLE HYDERABA D ITAT IS NOT APPLICABLE. THE DISALLOWANCE U/S 54B MADE BY AO OF RS.2,25,750/ - IS CONFIRMED. THIS GROUND OF APPEAL IS REJECTED. 6.1. FROM THE RECORDS, WE NOTICE THAT THE LD.CIT( A) WHILE DECIDING THE APPEAL HAD RELIED UPON THE DECISION OF THE COORDINA TE BENCH IN THE CASE OF DCIT VS. M.KALYAN CHAKARAVATHY, WHEREIN IT WAS HELD THAT IF AGRICULTURAL LAND SOLD BY THE ASSESSEE IS UTILIZED FOR NON-AGRICULTUR AL PURPOSE, THEN THE ASSESSEE IS NOT ENTITLED TO DEDUCTION U/S.54B OF TH E ACT. SINCE, IN THE PRESENT CASE, ASSESSEE HAS FAILED TO PROVE ANY AGRICULTURA L ACTIVITIES BEING CARRIED OUT ON THE LAND IN QUESTION PRIOR TO ITS SALE, THEREFOR E DISALLOWANCE OF DEDUCTION U/S.54B OF THE ACT WAS RIGHTLY UPHELD BY THE LD.CIT (A). 6.2. AFTER HAVING GONE THROUGH THE FACTS OF THE PRE SENT CASE, WE FIND THAT THE ASSESSEE FAILED TO EXPLAIN THE LAND IN QUESTION . THEREFORE, THE ASSESSING OFFICER AS WELL AS CIT(A) DECIDED THE ORDERS AGAINS T THE ASSESSEE WHILE MAKING DISALLOWANCE OF DEDUCTION U/S.54B OF THE ACT . EVEN BEFORE US, NO NEW FACTS OR CIRCUMSTANCES HAVE BEEN PLACED ON RECO RD AND THE ORDERS ITA NO.1419/AHD/2017 ARVINDSINH J.VAGHELA VS. ITO ASST.YEAR 2014-15 - 5 - PASSED BY THE REVENUE AUTHORITIES HAVE ALSO GONE UN REBUTTED, THEREFORE, WE FIND NO REASON TO INTERFERE INTO OR TO DEVIATE FROM SUCH FINDINGS OF THE AUTHORITIES BELOW AND WE UPHOLD THE DECISION OF THE LD.CIT(A) AND REJECT THE GROUND RAISED BY THE ASSESSEE. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DI SMISSED. ORDER PRONOUNCED IN THE COURT ON 13 - 03 - 2020 AT AHMEDABAD SD/- SD/- ( AMARJIT SINGH) ( SANDEEP GOSAIN) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED 13 / 03 /2020 & . . , . ' . ./ T.C. NAIR, SR. PS ! '! / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ()* + / CONCERNED CIT 4. + ( ) / THE CIT(A)-GANDHINAGAR, AHMEDABAD 5. ,-. '')* , )* , ( / DR, ITAT, AHMEDABAD 6. .01 / GUARD FILE. / BY ORDER, , ' //TRUE COPY// / (DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD 1. DATE OF DICTATION .. 11.3.20(DICTATION-PAD 5- PAGE S ATTACHED AT THE END OF THIS FILE) 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER ..11.3.20 3. OTHER MEMBER... 4. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S.. 5. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 6. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S13.3.20 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 13.3.20 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK ... 9. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 10. DATE OF DESPATCH OF THE ORDER