Subrata Das, Kolkata V. ACIT, Circle - 37, Kolkata, Kolkata

ITA 1451/KOL/2017

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 4782 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 7 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-02-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 2012-2013
• Appeal Filed On: 15-06-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: ROBIN CHOUDHUR Y
• Assessee Lawyers: JOYDEEP CHAKRABORTY
• Keywords: Capital asset; Wrong claim
• Section: 54; 54F

Judgement Text

1 ITA NO. 1451/KOL/2017 SUBRATA DAS, AY 2012-13 , B , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH: KOL KATA ( ) BEFORE . , /AND . . , ) [BEFORE SHRI J. SUDHAKAR REDDY, AM & SHRI A. T. VA RKEY, JM] I.T.A. NO. 1451/KOL/2017 ASSESSMENT YEAR: 2012-13 SUBRATA DAS (PAN: ADLPD9738Q) VS. ASSISTANT COMMISSIONER OF INCOME-TAX CIRCLE-37, KOLKATA. APPELLANT RESPONDENT FOR THE APPELLANT S/SHRI SOUMITRA CHOUDHURY & JOYDE EP CHAKRABORTY, ADVOCATES FOR THE RESPONDENT SHRI ROBIN CHOUDHURY, ADDL. CI T, SR. DR DATE OF HEARING 14.11.2018 DATE OF PRONOUNCEMENT 12.02.2019 ORDER PER SHRI A.T.VARKEY, JM THIS APPEAL OF THE ASSESSEE ARISES OUT OF THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) -11, KOLKATA FOR AY 2012-13 D ATED 13.04.2017. 2. THE ASSESSEE HAS RAISED THE FOLLOWING REVISED GR OUNDS OF APPEAL: 1. FOR THAT ON THE FACTS OF THE CASE THE ORDER PA SSED BY THE LD. CIT(A) WAS COMPLETELY ARBITRARY AND ILLEGAL. 2. FOR THAT ON THE FACTS OF THE CASE THE LD. CIT(A) WAS WRONG IN ALLOWING DEDUCTION U/S. 54F IN PLACE OF U/S. 54 OF THE I. T. ACT, 1961 WHICH IS CO MPLETELY ARBITRARY, UNJUSTIFIED AND ILLEGAL. 3. FOR THAT ON THE FACTS OF THE CASE THE LD. CIT(A) WAS WRONG IN NOT ALLOWING DEDUCTION U/S. 54 OF THE I. T. ACT, 1961 FOR THE SECOND PROPERTY P URCHASED IN DELHI AMOUNTING TO RS.7.00 LAKHS, WHICH IS COMPLETELY ARBITRARY, UNJUSTIFIED A ND ILLEGAL. 3. GROUND NO. 1 IS GENERAL IN NATURE DOES NOT REQUI RE ANY ADJUDICATION AND, HENCE, THE SAME IS DISMISSED. 2 ITA NO. 1451/KOL/2017 SUBRATA DAS, AY 2012-13 4. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE HA D SOLD THE PROPERTY, NOT BEING A RESIDENTIAL HOUSE AT DIGHA ON 01.11.2011 FOR RS.2,7 7,12,544/- AND COMPUTED LONG TERM CAPITAL GAIN OF RS.1,14,63,000/-. OUT OF THIS CAPI TAL GAIN THE ASSESSEE INVESTED RS. 20,00,000/- IN RURAL ELECTRIFICATION BOND ON 31.03. 2012. THE ASSESSEE FURTHER PAID RS.7,01,750/- BY DEMAND DRAFT TO ONE SMT. GITA GAYA L OF NEW DELHI AND OBTAINED A GENERAL POWER OF ATTORNEY IN RESPECT OF A FLAT AT 3 RD FLOOR (MEASURING ABOUT 105 SQ. YD) AT 351`, MOHENDRA ENCLAVE, G. T. KARNAL ROAD, DELHI-110 033. THE ASSESSEE CLAIMED DEDUCTION U/S. 54EC OF THE ACT FOR PURCHASE OF RURAL ELECTRIFICATI ON BOND AND U/S. 54F FOR PURCHASE OF BOTH IMMOVABLE PROPERTIES. HOWEVER, THE AO DID NOT ALLOW THE DEDUCTION FOR THE NEW RESIDENTIAL HOUSE AT KOLKATA. AGGRIEVED, ASSESSEE P REFERRED AN APPEAL BEFORE THE LD. CIT(A), WHO VIDE PARA 4.9 OF HIS ORDER HAS GIVEN PARTIAL RE LIEF TO ASSESSEE BY OBSERVING AS UNDER: 4.9. PLACING RELIANCE ON THE DECISION OF THE HONB LE SUPREME COURT, IT IS DECIDED THAT THE ASSESSEE IN THE INSTANT CASE HAD MADE PURCHASE OF O NLY ONE RESIDENTIAL HOUSE PROPERTY AND ACCORDINGLY HE IS ENTITLED TO THE BENEFIT OF SEC.54 F WHILE COMPUTING ITS INCOME IN THE HEAD CAPITAL GAIN THE GROUND OF THE APPEAL FOLLOWED BY THE ASSESSEE TO THIS EXTENT IS ALLOWED. THE ASSESSEE HEREUNDER SHALL BE ENTITLED TO TAKE BE NEFIT OF RS.45,67,510/- HE HAS INVESTMENT TO PURCHASE A RESIDENTIAL HOUSE AT KOLKATA. HE WIL L NOT GET THE BENEFIT OF RS.4,50,000/- HE CLAIMS TO HAVE INVESTED FOR REPAIR AND RENOVATION O F THIS HOUSE FOR WHICH HAS FAILED TO SHOW ANY EVIDENCE FOR SUCH EXPENDITURE . AGGRIEVED ASSESSEE IS BEFORE US. 5. WE HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUGH THE FACTS AND CIRCUMSTANCES OF THE CASE. THIS APPEAL IS AGAINST THE PARTIAL RELIEF NO T GRANTED TO ASSESSEE. THE LD. CIT(A) HAS ACCEPTED THE CLAIM OF ASSESSEE IN RESPECT TO ONLY T HE PROPERTY PURCHASED AT KOLKATA WITH THE AFORESAID RIDER. THE LD. CIT(A) HAS NOT ACCEPTED T HE CLAIM OF ASSESSEE ON THE RESIDENTIAL FLAT PURCHASED BY THE ASSESSEE ON GENERAL POWER OF ATTORNEY. THUS, WE NOTE THAT THE ONLY ISSUE IN THIS CASE IS REGARDING THE CLAIM OF THE AS SESSEE IN REGARD TO HOUSE PURCHASED IN DELHI ON THE STRENGTH OF GENERAL POWER OF ATTORNEY WHICH ACCORDING TO LD. CIT(A) IS NOT LEGALLY RECOGNIZED ACCEPTED MODE OF TRANSFER, THEREFORE, HE DID NOT ALLOW THE DEDUCTION U/S. 54F OF THE INCOME-TAX ACT, 1961 (HEREINAFTER REFERRED TO A S THE ACT) FOR THE PURCHASE OF THE SAID PROPERTY. HOWEVER, WE NOTE THAT WHILE PASSING THE ASSESSMENT ORDER, THE AO ACCEPTED THE CLAIM OF THE ASSESSEE IN RESPECT TO THE RESIDENTIAL PROPERTY PURCHASED AT DELHI ON THE STRENGTH OF GENERAL POWER OF ATTORNEY. HOWEVER, THE AO DID NOT ALLOW THE DEDUCTION FOR THE 3 ITA NO. 1451/KOL/2017 SUBRATA DAS, AY 2012-13 PROPERTY PURCHASED AT KOLKATA. ON APPEAL, THE LD. CIT(A) ALLOWED THE DEDUCTION U/S. 54F OF THE ACT FOR THE PROPERTY AT KOLKATA BUT DENIED T HE DEDUCTION FOR PROPERTY PURCHASED ON THE STRENGTH OF GENERAL POWER OF ATTORNEY IN DELHI. WE DO NOT COUNTENANCE THE ACTION OF THE LD. CIT(A) FOR THE REASON THAT THE HONBLE DELH I HIGH COURT IN THE CASE OF SPACE DEVELOPERS & PROMOTERS PVT. LTD. VS. GOVT. OF NCT R EPORTED IN (2013) 33 TAXMAN.COM 99 (DEL.) AFTER REFERRING TO SEC. 2(47) OF THE ACT HAS HELD THAT CONVEYANCE OF IMMOVABLE PROPERTY BY A GENERAL POWER OF ATTORNEY CONSTITUTED TRANSFER OF CAPITAL ASSET AND ALSO THE HONBLE HIGH COURT HELD THAT THE CIRCULAR DIRECTING REGISTRARS NOT TO REGISTER THE CONVEYANCE OF IMMOVABLE PROPERTY BY GENERAL POWER OF ATTORNEY WAS CONTRARY TO THE OBSERVATION OF THE HONBLE APEX COURT AND SET ASIDE THE CIRCULAR. THIS ORDER OF THE HONBLE HIGH COURT HAS BEEN TAKEN NOTE BY THE COORDINATE BENCH OF THIS TRI BUNAL AT DELHI IN SHRI SURINDER SINGH VS. ITO, ITA NO. 3450/DEL/2017 DATED 11.10.2018. THEREF ORE, IN THE LIGHT OF THE RATIO OF THE DECISION OF HONBLE DELHI HIGH COURT AS WELL AS TAK ING NOTE OF THE AOS ACTION IN ALLOWING THE DEDUCTION U/S. 54F OF THE ACT IN THE ASSESSMENT PROCEEDINGS, WE ARE OF THE OPINION THAT THE ASSESSEE SHOULD HAVE BEEN GIVEN THE DEDUCTION U /S. 54F OF THE ACT AND, MOREOVER EVEN IF THE TITLE IS IMPERFECT, ITS LEGAL CONSEQUENCES IF ANY IN-RESPECT TO FLAT IS THE LOOK OUT OF ASSESSEE AND ANY DEFECT IF ANY IN THE MODE OF TRAN SFER OF PROPERTY CANNOT DEFEAT THE CLAIM OF ASSESSEE IN THIS ASSESSMENT YEAR, BECAUSE IT IS NOT THE CASE OF LD CIT(A) THAT IT IS A BOGUS CLAIM, WHEN THE FACT OF POSSESSION OF FLAT BY ASSES SEE AND SALE CONSIDERATION PASSED TO THE VENDOR AND GENUINENESS OF THE TRANSACTION HAVING BE EN ACCEPTED BY AO AND THIS FACT NOT EVEN BEEN QUESTIONED BY LD CIT(A), THE CLAIM OUGHT NOT TO HAVE BEEN DISALLOWED BY LD CIT(A), THEREFORE, WE ALLOW THE CLAIM OF THE ASSESS EE FOR THE PURCHASE OF FLAT IN DELHI U/S. 54F OF THE ACT. 6. IN THE RESULT, THE APPEAL OF ASSESSEE IS PARTLY ALLOWED. ORDER IS PRONOUNCED IN THE OPEN COURT ON 12/02/201 9 SD/- SD/- (J. SUDHAKAR REDDY) (A. T. VARKEY) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 12TH FEBRUARY, 2019 4 ITA NO. 1451/KOL/2017 SUBRATA DAS, AY 2012-13 JD.(SR.P.S.) COPY OF THE ORDER FORWARDED TO: 1 APPELLANT SHRI SUBRATA DAS, 27, SHANKAR GHOSH LA NE, KOLKATA-700 006. 2 RESPONDENT ACIT, CIRCLE-37, KOLKATA. 3 4 5 CIT(A)-11, KOLKATA. (SENT THROUGH E-MAIL) CIT , KOLKATA DR, KOLKATA BENCHES, KOLKATA (SENT THROUGH E-MAIL) / TRUE COPY, BY ORDER, ASSISTANT REGISTRAR