ITO, W-7(4), Ludhiana V. Sh. Jatinder Singh Sandhu, Ludhiana

ITA 1491/CHANDI/2017

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 4058 (ITAT-CHANDIGARH)
• Duration Of Justice: 9 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-08-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 15-05-2018
• Assessment Year: 2008-2009
• Appeal Filed On: 24-10-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DEEPIKA MOHAN
• Assessee Lawyers: ASHWANI KUMARCA; KANIKA GUPTA
• Keywords: Capital asset
• Section: 2(14)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, A CHANDIGARH BEFORE SHRI SANJAY GARG, JUDICIAL MEMBER AND MS. ANNAPURNA GUPTA, ACCOUNTANT MEMBER ITA NO. 1491/CHD/2017 ASSESSMENT YEAR : 2008-09 THE ITO, VS. SH. JATINDER SINGH SANDHU, WARD-7(4), 3407, GURDEV NAGAR, LUDHIANA LUDHIANA PAN NO. AFIPS8039N (APPELLANT) (RESPONDENT) APPELLANT BY : MS. DEEPIKA MOHAN, JCIT RESPONDENT BY : SH. ASHWANI KUMAR,CA & MS.KANIKA GUPTA, CA DATE OF HEARING : 15.05.2018 DATE OF PRONOUNCEMENT : 09. 08. 2018 ORDER PER SANJAY GARG, JUDICIAL MEMBER: THE PRESENT APPEAL HAS BEEN PREFERRED BY THE REVEN UE AGAINST THE ORDER DATED 4.8.2017 OF THE COMMISSIONER OF IN COME TAX(A)-3, LUDHIANA [HEREINAFTER REFERRED TO AS CIT(A)]. 2. THE REVENUE IN THIS APPEAL HAS TAKEN THE FOLLOWI NG EFFECTIVE GROUND OF APPEAL:- WHETHER UPON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) WAS JUSTIFIED IN TREATING THE IMPUGNED LAND AS AGRICULTURE LAND WHEREAS THE AGRICULTURE LAND OF THE ASSESSEE FALLS WITH 8 KMS FROM THE MUNICIPAL CORPORATION LIMIT AS MEASURED THE DISTANCE OF LAND IN THE PRESENCE OF ASSESSEES COUNSEL CA AND FOUND DISTANCE BY ROAD ON IS 6.3 KILOMETERS. ITA NO. 1491/CHD/2017- SHRI JATINDER SINGH SANDHU, LUDHIANA 2 2. THE SOLE ISSUE RAISED IN THIS APPEAL IS AS TO WH ETHER THE LAND OF THE ASSESSEE CONSTITUTE AS A CAPITAL ASSET WITHIN T HE MEANING OF SECTION 2(14) (III) OF THE INCOME-TAX ACT, 1961 (IN SHORT 'THE ACT') SO AS TO ATTRACT CAPITAL GAINS TAX ON ITS SALE. 3. THE LD. CIT(A) IN THIS CASE HAS OBSERVED THAT TH E LAND OF THE ASSESSEE WAS BEYOND 8KMS FROM THE MUNICIPAL LIMIT AND AS SUCH, THE LAND WOULD NOT FALL IN THE DEFINITION OF THE CA PITAL ASSET TO ATTRACT LONG TERM CAPITAL GAIN. THE LD. CIT(A) WHILE HOLDI NG SO HAD OBSERVED THAT THE ASSESSING OFFICER HAD TAKEN INTO CONSIDERATION THE ROAD / ROUTE TO THE LAND OF THE ASSESSEE WHICH WAS NOT IN EXISTENCE AT THE TIME OF TRANSACTION OF SALE OF LAND I.E. DUR ING FINANCIAL YEAR 2007-08. THE DISTANCE MEASURED BY THE ASSESSEE IN RESPECT OF ROAD WHICH WAS SUBSEQUENTLY CONSTRUCTED FROM 1.7.2009 TO SEPT. 2011 COULD NOT BE RELIED UPON. THE LD. CIT(A) HELD THAT THE DISTANCE FROM MUNICIPAL COUNCIL APPROACHING TO THE LAND WAS TO BE TAKEN THROUGH THE ROAD THAT WAS IN EXISTENCE AT THE TIME OF SALE TRANSACTION IN QUESTION AND NOT MEASURED THROUGH SUBSEQUENTLY CONS TRUCTED ROAD. THE RELEVANT PART OF THE ORDER OF LD. CIT(A) IS REP RODUCED AS UNDER:- 3.11 I HAVE GONE THROUGH THE BASIC FACTS OF THE CASE. I HAVE ALSO GONE THROUGH THE ASSESSMENT ORDER OF THE ASSESSING OFFICER IN COMPLIANCE TO THE DIRECTION OF HONOURABLE ITAT. I HAVE ALSO CONSIDERED DIFFERENT C ASE LAWS, RELIED UPON BY THE ASSESSING OFFICER AND THE ASSESSMENT PROCEEDINGS DURING THE COURSE OF APPELLA TE PROCEEDINGS AS WELL. IN MY CONSIDERED VIEW THE ASSE SSING OFFICER AT THE TIME OF ORIGINAL ASSESSMENT ORDER AN D AS AT THE TIME OF SET ASIDE PROCEEDINGS IN COMPLIANCE TO EARN DIRECTION OF HONOUARBLE ITAT, HAS IGNORE THE BASIC FACTS AND HAS FORGOTTEN TO TAKE THE VIEW OF THE VERY GL ARING FACT THAT THE ROUTE ON WHICH ASSESSING OFFICER HAS RELIE D UPON ITA NO. 1491/CHD/2017- SHRI JATINDER SINGH SANDHU, LUDHIANA 3 AND HAS MADE THE ASSESSMENT, STATING THE ATTRACTION OF CAPITAL GAIN TAX ON THE TRANSACTION OF SALE, AT THE TIME OF FINANCIAL YEAR 2007-08. NO SUCH ROAD WAS EXISTENT ALONGWITH SIDHWAN CANAL FROM JHAMAT BRIDGE TO BIRMI BRIDGE AND FURTHER ON TO ISSEWAL BRIDGE. THE ASSESS ING OFFICER HAS COMPLETELY IGNORED THE BASIC FACT, THAT NIRMALJEET SINGH SEKHON MARG, WAS NOT AT ALL IN EXI STENCE AT THE TIME OF FINANCIAL YEAR 2007-08 AS PER THE RE PORT OF THE EXECUTIVE ENGINEER DIVISION1 PWD (B&R) BR. LUDH IANA AS THIS STRETCH OF ROAD WAS CONSTRUCTED FROM JULY 2 009 TO SEPTEMBER 2011, THEREFORE, BY NO STRETCH OF IMAGINA TION IT COULD BE CONSTRUCTED THAT THIS WAS IN EXISTENCE AT THE TIME OF PERIOD UNDER CONSIDERATION. THEREFORE, CONSIDERI NG ALL THE FACTS AND ALL THE RELEVANT REPORTS IN MY CONSID ERED VIEW THE DISALLOWANCE RS. 1,16,54,809/- TREATING THE AGRICULTURAL LAND SOLD, SITUATED IN VILLAGE BIRMI, SUB. TEHSIL, MULALNPUR, TEHSIL MLLANPUR, TEHSIL & DISTRI CT LUDHIANA AS A CAPITAL ASSET U/S 2(14)(III) OF THE I NCOME-TAX ACT, 1961 AND THEREBY CHARGING TAX ON THE LONG TER M CAPITAL GAIN FOR RS. 1,16,54,809 IS ORDERED TO BE D ELETED. 4. AFTER CONSIDERING THE RIVAL SUBMISSIONS AND GOIN G THROUGH THE IMPUGNED ORDER, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE CIT(A) IN THIS CASE. THERE IS NO MERIT IN THE APPE AL OF THE REVENUE AND THE SAME IS ACCORDINGLY DISMISSED. IN THE RESULT, THE APPEAL OF THE REVENUE IS HEREBY DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 09.08.2018 SD/- SD/- (ANNAPURNA GUPTA) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED :09. 08. 2018 RKK COPY TO: THE APPELLANT THE RESPONDENT THE CIT THE CIT(A) THE DR