Natukaari Gopal, Hyderabad V. ITO., Ward-1, Sanga Reddy

ITA 1474/HYD/2014

• Counselvise Citation: 147422514 RSA 2014
• Duration Of Justice: 4 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-01-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 19-01-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 11-09-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJAT MITRA
• Keywords: Capital asset; Principle of natural justice; Opportunity of cross examination; Third party statement

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES B, HYDERABAD BEFORE SHRI D. MANMOHAN, VICE PRESIDENT AND SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER I.T.A. NO. 1474/HYD/2014 ASSESSMENT YEAR: 2007-08 SHRI NATUKAARI GOPAL, KONDAPUR MANDAL, MEDAK DIST., [PAN: AJUPN 1204 C] VS THE INCOME TAX OFFICER, WARD-I, SANGA REDDY (APPELLANT) (RESPONDENT) FOR ASSESSEE : SHRI K.C.DEVDAS, AR FOR REVENUE : SHRI RAJAT MITRA, DR DATE OF HEARING : 19 - 0 1 - 201 5 DATE OF PRONOUNCEMENT : 21 - 01 - 2015 O R D E R PER B. RAMAKOTAIAH, A.M. : THIS IS AN ASSESSEE'S APPEAL FILED AGAINST THE ORD ER OF THE COMMISSIONER OF INCOME TAX(APPEALS)-III, HYDERABAD DATED 04-06-2014 ON THE ISSUE OF TAXATION OF CAPITAL GAINS ON SALE O F AGRICULTURAL LAND PERTAINING TO ASSESSEE. 2. BRIEFLY STATED, ASSESSEE STATED TO BE AN ILLITER ATE AND EKING OUT HIS LIVELY-HOOD BY RARING CATTLE OWNS A SMALL BIT OF LA ND SITUATED AT MALKAPUR I.T.A. NO. 1474/HYD/2014 SRI NATUKAARI GOPAL :- 2 -: VILLAGE, KONDAPUR MANDAL, MEDAK DISTRICT. ON 17-11 -2006, ASSESSEE AND ANOTHER PERSON BY NAME MR.PRAVIN KUMAR SOLD 30 GUNTAS OF AGRICULTURAL LAND LOCATED AT SURVEY NO.139 OF THE S AID VILLAGE FOR A RECORDED CONSIDERATION OF RS.1,50,000/-. IT SEEMS T HERE WERE CERTAIN SURVEY OPERATIONS IN THE PREMISES OF SMT. BHAGYA LA KSHMI AND OTHERS ON 22-08-2008. ASSESSING OFFICER NOTICED THAT THOS E PEOPLE PURCHASED PROPERTY TO AN EXTENT OF 15.14 GUNTAS AND ASSESSEE' S SHARE OF PRICE PAID BY THOSE PEOPLE WAS AT RS.24,91,860/- AS AGAINST RS .1,50,000/- RECORDED IN THE SALE DEED. ASSESSING OFFICER THERE FORE ISSUED A NOTICE U/S.142(1) CALLING FOR RETURN OF INCOME. ASSESSEE BEING UN-EDUCATED, DID NOT RESPOND TO THE NOTICES AND FILED CERTAIN LETTER S INFORMING ASSESSING OFFICER THAT THE DEAL WAS FINALIZED THROUGH BROKERS . HE GOT ONLY RS.11,00,000/- AND HAS DISCHARGED CERTAIN FAMILY LI ABILITIES AND ALSO PURCHASED AGRICULTURAL LAND OF 20 GUNTAS. ASSESSIN G OFFICER ISSUED FURTHER NOTICES AND CALLED FOR DETAILS. AS THERE W AS NO RESPONSE, HE HAS COMPLETED THE ASSESSMENT CONSIDERING THE PRICE STAT ED TO HAVE BEEN PAID BY THE PURCHASER AS INCOME OF ASSESSEE, WITHOUT COM PUTING THE CAPITAL GAINS. ASSESSEE PREFERRED APPEAL BEFORE LD.CIT(A). 3. IN THE MEAN TIME, ASSESSEE ASKED FOR CERTIFIED C OPIES OF THE ASSESSMENT ORDER AND OTHER RELEVANT DOCUMENTS OF SM T. BHAGYA LAKSHMI AND OTHERS THROUGH THE AUTHORIZED REPRESENT ATIVE. ASSESSING OFFICER VIDE HIS LETTER DT.23-05-2014 DID NOT FURNI SH ANY EVIDENCE STATING THAT THIS IS A THIRD PARTY INFORMATION WHICH CANNOT BE REVEALED TO THE AUTHORIZED REPRESENTATIVE. ASSESSEE MADE FURTHER S UBMISSIONS TO THE CIT(A) OF NOT GIVING ENOUGH OPPORTUNITY BUT ALSO BR INGING TO TAX AMOUNTS ON THE BASIS OF THIRD PARTY STATEMENTS WITHOUT CONF RONTING ASSESSEE. LD.CIT(A) DISMISSED ASSESSEE'S CONTENTIONS, WITHOUT CONSIDERING THE MERITS DISMISSED THE APPEAL. I.T.A. NO. 1474/HYD/2014 SRI NATUKAARI GOPAL :- 3 -: 4. BEFORE US, IT WAS THE CONTENTION THAT ASSESSEE S HOULD BE GIVEN DUE OPPORTUNITY AND LD.COUNSEL RELIED ON VARIOUS DOCUME NTS PLACED ON THE PAPER BOOK. LD.DR HOWEVER, RELIED ON THE ORDERS OF THE AUTHORITIES. 5. HAVING CONSIDERED THE RIVAL CONTENTIONS AND PERU SING THE ORDERS OF THE AUTHORITIES AND THE DOCUMENTS PLACED ON RECORD, WE ARE UNABLE TO UNDERSTAND HOW THE ASSESSING OFFICER CAN DETERMINE THE SALE PRICE AS INCOME OF ASSESSEE. MOREOVER, ASSESSEE WAS NOT AWA RE ABOUT THE STATEMENT GIVEN BY THE SAID SMT. BHAGYA LAKSHMI AND OTHERS. IT IS ALSO NOTICED THAT ASSESSEE HAS SOLD THE AGRICULTURAL PRO PERTY TO ONE MR. T.CHANDRA SEKHAR AND SHRI V.PAPAIAH BEING THE VENDO RS. HOW THESE TWO ARE CONNECTED WITH SMT. BHAGYA LAKSHMI IN THE P URCHASE OF THE SO CALLED 15.14 ACRES IS NOT COMING OUT OF THE ASSESS MENT ORDER. NOT ONLY THAT THE BASIS OF DETERMINING THE PRICE IS ALSO NOT FORTHCOMING FROM THE ORDERS. IN FACT ASSESSEE ASKED FOR COPIES OF THE D OCUMENTS RELIED ON BY THE ASSESSING OFFICER WHICH ARE ALSO DENIED TO HIM AS STATED ABOVE. 6. WE ALSO PERUSED THE SALE DEED DT.17-11-2006. IT IS CLEAR FROM THE RECITALS THAT PROPERTY IS ANCESTRAL PROPERTY DEVOLV ED ON ASSESSEE BY WAY OF PARTITION. IN THAT CASE, THE STATUS OF ASSESSEE , BEING HUF PROPERTY OR INDIVIDUAL ALSO REQUIRED TO BE DETERMINED. NOT ONL Y THAT, 1/4 TH OF THE SHARE OF THE PROPERTY, AS CAN BE SEEN FROM THE RECI TALS OF THE SALE DEED, PERTAIN TO HIS SON WHO ALSO BECAME VENDOR NO.2. WH EN THE SALE DEED IS VERY CLEAR ABOUT RESPECTIVE SHARES, HOW THE ENTIRE AMOUNT CAN BE BROUGHT TO TAX IN THE HANDS OF ASSESSEE WAS ALSO NO T EXPLAINED BY THE ASSESSING OFFICER. FURTHER, DOCUMENT OF SALE INDICA TES THAT THE PROPERTY SOLD WAS AGRICULTURAL LAND. WHETHER SALE OF AGRICU LTURAL LAND CAN BE CONSIDERED AS A CAPITAL ASSET OR NOT ALSO REQUIRED TO BE CONSIDERED. PRINCIPLES OF NATURAL JUSTICE HAVE NOT BEEN FOLLOWE D IN THIS CASE, WE ARE OF THE OPINION THAT ASSESSEE SHOULD BE GIVEN DUE OP PORTUNITY. SINCE I.T.A. NO. 1474/HYD/2014 SRI NATUKAARI GOPAL :- 4 -: ASSESSEE SEEMS TO BE AN ILLITERATE PERSON, IT IS TH E DUTY OF THE OFFICER TO EXPLAIN THE PROVISIONS OF LAW, SO THAT THE PERSON C AN FOLLOW THE PROCEEDINGS. IT IS ALL THE MORE NECESSARY THAT ASS ESSING OFFICER SHOULD FOLLOW THE PROVISIONS OF LAW BEFORE RAISING A DEMAN D AGAINST ASSESSEE. WE WERE ALSO SURPRISED TO NOTE THAT LD.CIT(A) DISMI SSED THE APPEAL WITHOUT CONSIDERING ANY OF THE CONTENTIONS OR ISSUE S INVOLVED IN THE ASSESSMENT. WE ARE OF THE OPINION THAT ASSESSEE SH OULD BE GIVEN DUE OPPORTUNITY. ASSESSING OFFICER SHOULD DETERMINE THE CORRECT STATUS, SHARES OF THE ASSESSEE AND THE PRICE HE RECEIVED SO THAT CORRECT CAPITAL GAINS CAN BE BROUGHT TO TAX. ASSESSING OFFICER IS DIRECTED TO EXAMINE ALL THE ISSUES AND THEN ONLY COMPLETE THE ASSESSMENT AS PER FACTS AND PROVISIONS OF LAW. ASSESSEE IS FREE TO RAISE ANY O BJECTIONS OR CONTENTIONS INVOLVED IN THE ASSESSMENT PROCEDURE. 7. WITH THESE OBSERVATIONS/ DIRECTIONS THE ORDERS O F THE AUTHORITIES ARE SET ASIDE TO DECIDE THE ISSUE AFRESH AND COMPLE TE THE ASSESSMENT ACCORDINGLY. 8. IN THE RESULT, APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON 21 ST JANUARY, 2015. SD/- SD/- (D. MANMOHAN) (B. RAMAKOTAIAH) VICE PRESIDENT ACCOUNTA NT MEMBER HYDERABAD, DATED 21 ST JANUARY, 2015 TNMM I.T.A. NO. 1474/HYD/2014 SRI NATUKAARI GOPAL :- 5 -: COPY TO : 1. SHRI NATUKAARI GOPAL, NO.3 - 60, MALKAPUR VILLAGE, KONDAPUR MANDAL, MEDAK DIST., C/O. SHRI B.NARSING RAO & CO., CHARTERED ACCOUNTANTS, PLOT NO.554, ROAD NO.92, JUB ILEE HILLS, HYDERABAD-96. 2. THE INCOME TAX OFFICER, WARD-1, SANGAREDDY. 3. CIT(A)-III, HYDERABAD 4. CIT-II, HYDERABAD 5. D.R. ITAT, HYDERABAD.