Rafat Ghani , Hyderabad V. Asst. Commissioner of Income Tax, Circle-7(1), Hyderabad

ITA 159/Hyd/2019

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 2931 (ITAT-HYDERABAD)
• Duration Of Justice: 2 year(s) 4 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-06-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB-A
• Next Hearing Date: 15-06-2021
• Assessment Year: 2010-2011
• Appeal Filed On: 06-02-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Set aside
• Section: 54F; 54

Judgement Text

ITA NO 159 OF 2019 RAFAT GHANI HYDERABAD PAGE 1 OF 5 IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD A BENCH, HYDERABAD (THROUGH VIDEO CONFERENCING) BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ITA NO.159/HYD/2019 ASSESSMENT YEAR: 2010-11 LATE SMT. RAFAT GHANI (REP.BY L/R SMT.FARHEEN GHANI, HYDERABAD PAN:ATHPG4766H VS. ASSTT. COMMISSIONER OF INCOME TAX, CIRCLE 7(1) HYDERABAD (APPELLANT) (RESPONDENT) ASSESSEE BY: SRI S.RAMA RAO REVENUE BY : SRI SUBRAMANYAM TOTA,DR DATE OF HEARING: 15/06/2021 DATE OF PRONOUNCEMENT: 18/06/2021 ORDER PER SMT. P. MADHAVI DEVI, J.M. THIS IS ASSESSEES APPEAL FOR THE A.Y 2010-11 AGAIN ST THE ORDER OF THE CIT (A)-3, HYDERABAD, DATED 19.11. 2018. IT IS NOTICED THAT THE ASSESSEE HAS EXPIRED ON 18.01.2020 AND HER LEGAL HEIR HAS BEEN BROUGHT ON RECORD. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IN DIVIDUAL HAD ENTERED INTO A DEVELOPMENT AGREEMENT WITH ONE S HRI SYED AQIL FAIQ TO DEVELOP THE PROPERTY OF THE ASSESSEE S ITUATED AT RED HILLS, HYDERABAD FOR CONSTRUCTION OF A COMPLEX CONS ISTING OF RESIDENTIAL FLATS. SHE AGREED TO RELINQUISH THE RIG HTS OF OWNERSHIP OVER 50% OF THE BUILT-UP AREA IN FAVOUR OF THE DEVE LOPER IN EXCHANGE FOR DEVELOPING THE PROPERTY OF THE ASSESSE E AT THE COST ITA NO 159 OF 2019 RAFAT GHANI HYDERABAD PAGE 2 OF 5 AND EXPENSES OF THE DEVELOPER. THE AGREEMENT WAS EN TERED INTO VIDE REGISTERED SALE DEED NO.128/2010 ON 29.12.2009 WHEREIN THE SRO VALUE OF THE DEVELOPED PROPERTY WAS DETERMINED AT RS.1,15,47,000/- ON WHICH STAMP DUTY WAS PAID. 3. SINCE THIS INFORMATION WAS RECEIVED BY THE ASSES SING OFFICER AND IT WAS FOUND THAT THE ASSESSEE HAS NOT FILED ANY RETURN OF INCOME FOR THE RELEVANT A.Y DECLARING CAPITAL GA INS ON THE CONSIDERATION RECEIVED TOWARDS HER SHARE (50%) AS P ER THE JOINT DEVELOPMENT AGREEMENT, THE ASSESSING OFFICER REOPEN ED THE ASSESSMENT AND AFTER EXAMINING THE ASSESSEES CONTE NTION ABOUT THE EXEMPTION U/S 54F OF THE ACT, THE ASSESSING OFF ICER HELD THAT SINCE THE ASSESSEE HAS NOT FILED HER RETURN OF INCO ME FOR THE RELEVANT A.Y AND HAS NOT CLAIMED THE EXEMPTION U/S 54F OF THE ACT, THE SAME IS NOT ALLOWABLE TO THE ASSESSEE. HE ACCORDINGLY COMPUTED THE LONG TERM CAPITAL GAIN OF RS.56,62,800 /- AND BROUGHT IT TO TAX. 4. AGGRIEVED, THE ASSESSEE PREFERRED AN APPEAL BEFO RE THE CIT (A). THE CIT (A) OBSERVED THAT THE ASSESSEE HAS NOT FILED THE RETURN OF INCOME NOR HAS GIVEN ANY REASON AS TO WHY THE ASSESSEE DID NOT FILE THE ROI AND HAS NOT PAID THE ADVANCE T AX PAYABLE BY THE ASSESSEE AS IS REQUIRED TO ADMIT AN APPEAL UNDE R THE PROVISIONS OF SECTION 249(4)(B) OF THE ACT. THEREFO RE, HE HELD THAT THE APPEAL OF THE ASSESSEE IS NOT ADMISSIBLE AND DI SMISSED IT IN LIMINI. AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL BY RAISING THE FOLLOWING GROUNDS OF APPEAL: 1. THE ORDER OF THE LEARNED COMMISSIONER OF INCOME- TAX (APPEALS) IS ERRONEOUS BOTH ON FACTS AND IN LAW. 2. THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) ERRED IN HOLDING THAT THE APPEAL FILED BY THE APPELLANT I S NOT MAINTAINABLE. THE LEARNED COMMISSIONER OF INCOME-TA X ITA NO 159 OF 2019 RAFAT GHANI HYDERABAD PAGE 3 OF 5 (APPEALS) OUGHT TO HAVE SEEN THAT ACCORDING TO THE APPELLANT NO TAX IS PAYABLE BY HIM AND THAT, THEREFORE, NO AD VANCE TAX LIABILITY ARISES AND IN VIEW OF THE SAME, THE PROVI SIONS CONTAINED IN SEC.249(4)(B) HAVE NO APPLICATION. 3. THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) ERRED IN HOLDING THAT THE APPELLANT IS LIABLE TO PAY ANY ADVANCE TAX AND THAT THERE WAS FAILURE AS MENTIONED IN SEC.249( 4)(B) OF THE LT. ACT. AS AN ALTERNATE THE LEARNED COMMISSION ER OF INCOME-TAX (APPEALS) OUGHT TO HAVE PROVIDED PROPERT Y OPPORTUNITY. 4. THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) OUGHT TO HAVE CONSIDERED EACH OF THE GROUNDS AGITATED BEF ORE HIM AND DECIDED THE APPEAL ON MERITS. 5. THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) OUGHT TO HAVE CONSIDERED THAT THE ASSESSING OFFICER WRONG LY WORKED OUT THE CAPITAL GAIN; DID NOT ALLOW THE AMOUNT OF D EDUCTION CLAIMED U/S 54 OF THE IT ACT AND IF THE ASSESSING O FFICER HAD CORRECTLY WORKED OUT THE INCOME THERE WOULD NOT HAV E BEEN ANY TAX PAYABLE. 6. ANY OTHER GROUND THAT MAY BE URGED AT THE TIME O F HEARING. 5. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED T HAT BEFORE DISMISSING THE APPEAL OF THE ASSESSEE AS NOT MAINTAINABLE, THE CIT (A) OUGHT TO HAVE GIVEN THE ASSESSEE AN OPP ORTUNITY TO EXPLAIN HER CASE. THEREFORE, HE PRAYED THAT THE APP EAL MAY BE SET ASIDE TO THE FILE OF THE CIT (A) FOR RE-ADJUDICATIO N OF THE ISSUES OF BOTH THE APPLICABILITY OF THE PROVISIONS OF SECTION 249(4)(B) AND ALSO ON MERITS OF THE ADDITION. 6. THE LEARNED DR, HOWEVER, RELIED UPON THE ORDERS OF THE AUTHORITIES BELOW AND SUBMITTED THAT SINCE THE ASSE SSEE DID NOT FILE THE RETURN OF INCOME, HER APPEAL WOULD FALL UN DER THE PROVISO TO SECTION 249(4)(B) OF THE ACT AND SINCE THE ASSES SEE HAS NOT FILED ANY APPLICATION UNDER THE PROVISO, THE CIT (A) HAD NO CHOICE BUT TO DISMISS THE ASSESSEES APPEAL. AT THIS JUNCTURE, THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSE E WOULD FILE THE APPLICATION UNDER THE PROVISO TO SECTION 249(4) (B) OF THE ACT ITA NO 159 OF 2019 RAFAT GHANI HYDERABAD PAGE 4 OF 5 AND THE CIT (A) MAY BE DIRECTED TO DISPOSE OF SUCH AN APPLICATION AND ALSO THE MERITS OF THE APPEAL. 7. HAVING REGARD TO THE RIVAL CONTENTIONS AND THE M ATERIAL ON RECORD, WE FIND THAT THE PROVISIONS OF SECTION 2 49(4)(B) ARE APPLICABLE TO THE CASE ON HAND SINCE THE ASSESSEE H AS NOT FILED THE RETURN OF INCOME, NOR HAS PAID THE ADVANCE TAX PAYA BLE BY HER. THEREFORE, SHE OUGHT TO HAVE FILED AN APPLICATION U NDER THE PROVISO TO SECTION 249(4)(B) OF THE ACT FOR EXEMPTI ON FROM THE APPLICATION OF SECTION 249(4)(B) OF THE ACT. IN SUC H CIRCUMSTANCES, THE CIT (A) HAD NO CHOICE BUT TO DISMISS THE APPEAL AS IT WAS DEFECTIVE. HOWEVER, PURELY IN THE INTEREST OF JUSTI CE AND TAKING THE PRAYER OF THE ASSESSEE INTO CONSIDERATION, WE SET A SIDE THE ISSUE TO THE FILE OF THE CIT (A) WITH A DIRECTION TO THE ASS ESSEE TO FILE THE APPLICATION UNDER THE PROVISO TO SECTION 249(4)(B) OF THE ACT WITHIN A PERIOD OF ONE MONTH FROM THE DATE OF RECEI PT OF THIS ORDER AND THEREAFTER, THE CIT (A) SHALL DISPOSE OF SUCH A PPLICATION OF THE ASSESSEE AND DECIDE ON THE ISSUE OF EXEMPTION FROM THE APPLICATION OF THE PROVISIONS OF SECTION 249(4)(B) AND THEREAFTER, THE CIT (A) SHALL ALSO DECIDE THE APPEAL ON MERITS. NEEDLESS TO MENTION THAT THE ASSESSEE SHALL BE GIVEN A FAIR OPP ORTUNITY OF HEARING. 8. IN THE RESULT, ASSESSEES APPEAL IS TREATED AS A LLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 18 TH JUNE, 2021. SD/- SD/- (A. MOHAN ALANKAMONY) ACCOUNTANT MEMBER (P. MADHAVI DEVI) JUDICIAL MEMBER HYDERABAD, DATED JUNE, 2021. VINODAN/SPS ITA NO 159 OF 2019 RAFAT GHANI HYDERABAD PAGE 5 OF 5 COPY TO: S. NO ADDRESS ES 1 SRI RAFAT GHANI, H.NO.11-5-132, RED HILLS, HYDERA BAD 500004 2 ACIT, CIRCLE 7(1) IT TOWERS, AC GUARDS, HYDERABAD 500004 3 CIT (A) - 3, HYDERABAD 4 PR. CIT - 3, HYDERABA D 5 DR, ITAT HYDERABAD BENCHES 6 GUARD FILE BY ORDER