Raosaheb Jijaba Anbhule, Ahmednagar V. Income-tax Officer,

ITA 1673/PUN/2015

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 0435 (ITAT-PUNE)
• Duration Of Justice: 11 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-12-2016
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Next Hearing Date: 19-10-2016
• Assessment Year: 2011-2012
• Appeal Filed On: 21-12-2015
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: CHAVAN
• Section: 54B; 54F

Judgement Text

- IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH SMC , PUNE , BEFORE MS. SUSHMA CHOWLA, JM . / ITA NO. 1673 /PN/201 5 / ASSESS MENT YEAR : 20 11 - 1 2 RAOSAHEB JIJABA ANBHULE, M/S. KADAM & CO. VEDNAT 8/9, VIRAJ ESTATE, OPP. TARAKPUR BUS STAND, AHMEDNAGAR 414003 . / APPELLANT PAN: A ARPA8957H VS. THE INCOME TAX OFFICER , WARD 1, AHMEDNAGAR . / RE SPONDENT WARD 1, AHMEDNAGAR . / RE SPONDENT / APPELLANT BY : WRITTEN SUBMISSIONS / RESPONDENT BY : S HRI B.Y. CHAVAN / DATE OF HEARING : 0 6 . 1 2 .201 6 / DATE OF PRONOUNCEMENT: 09 . 1 2 .201 6 / ORDER PER S USHMA CHOWLA, J M : TH IS APPEAL FILED BY THE ASSESSEE IS AGAINST THE ORDER OF CIT (A) - 2 , PUNE , DATED 2 8 . 0 9 .20 1 5 RELATING TO ASSESSMENT YEAR 20 11 - 1 2 AGAINST ORDER PASSED UNDER SECTION 1 4 3(3) OF THE INCOME - TAX ACT , 1961 (IN SHORT THE ACT) . ITA NO. 1673 /PN/20 1 5 SHRI RAOSAHEB JIJABA ANBHULE 2 2 . THE ASSESSEE H AS RAISED THE FOLLOWING GROUND S OF APPEAL : - 1. THE A.O. ERRED IN REJECTING THE CLAIM PREFERRED U /S. 54B ON THE GROUND THAT THE APPELLANT ASSESSEE HAD PURCHASED THE AGRICULTURE LANDS BEFORE SALE OF AGRICULTURE LAND ON WHICH CAPITAL GAIN ARISED , IGNORING THE FACTS THAT THE NEW ASSETS I.E. AGRICULTURE LANDS, THOUGH WERE PURCHASED BEFORE THE DATE OF SALE OF OLD ASSET, THE INVESTMENTS MADE WERE OUT OF EARNEST MONEY RECEIVED AS PART OF CONSIDERATION RECEIVED BEFORE SALE. THE CIT(A) HAS ALSO ERRED IN UPHOLDING T HE ACTION OF THE A.O. THE HON' BLE ITAT PUNE BENCH PUNE IS REQUESTED TO ALLOW THE DEDUCTION OF RS.8 , 10 , 449/ - U /S.54B AS CLAIMED . 2. THE CIT (A) HAS ERRED IN HOLDING, AS STATED IN PARA - 5 OF HIS ORDER DATED 28.09.2015, THAT ONLY INVESTMENTS MADE AFTER THE DA TE OF SALE TRANSACTION ATTRACTING CAPITAL GAIN ARE ELIGIBLE FOR DEDUCTION U /S.54B. THE DECISION OF THE CIT(A) IS CONTRARY TO THE DECISION OF HON' BLE ITA T PUNE BENCH , PUNE IN THE CASE OF SHRI SUBHASH VINAYK SUPNEKAR V/S. ACIT REPORTED I N (2013) 158 TTJ (PUN E) 237 WHEREIN IT WAS HELD THAT INVESTMENTS MADE OUT OF ADVANCE ON EARNEST MONEY PRIOR TO THE DATE OF SALE TRANSACTIONS ATTRACTING CAPITAL GAIN, IS ELIGIBLE FOR DEDU C TION U/S. 54EC. THE DECISION IS SQUAR E LY APPLICABLE FOR DEDUCTION U /S.54B ALSO. HOWEVER, T HE HON' BLE CIT(A) IN PARA 5 OF HIS ORDER HELD THE DECISION OF THE HON' BLE ITA T PUNE AS PREMATURE ONE DUE TO THE FOLLOWING FACTS. I ) NO FACTS WERE EVER PLACED BEFORE THE A.O. II ) EVEN DURING APPELLATE PROC E EDINGS NO BANK STATEMENTS EVIDENCING ANY ADVANCE PAYMENT RECEIPT, PURCHASE/SALE DEEDS OR ANY OTHER DOCUMENT WAS FILED AND III ) JUST FILING OF PLAIN SUBMISSION WITHOUT ANY CORROBORA T IVE EVIDENCE DOES NOT HELP THE CAUSE OF ASSESSEE. IN THIS CONNECTION IT IS SUBMITTED THAT DURING THE COURSE OF ASSESSMENT PROCEEDINGS ONLY ALL THE FACTS EVIDENCING THE SALE PURCHASE, ADVAN C ES RECEIVED WERE FURNISHED VIDE LETTER DATED 10.12.2013 BUT THE A.O HAD PASSED ORDER ON 09.12.2013 AND NO COGNI ZA NCE OF THE FACTS COULD BE TAKEN BY THE A.O. UNFORTUNATELY THERE HAD BEEN NO OCCASION TO SUBMIT THE DOCUMENT A RY EVID E NCE AND FACTS BEFORE THE HON' BLE CIT(A). THE HON' BLE ITAT PUNE IS THER E FORE, REQUESTED TO SET ASIDE THE ASSESSMENT ORDER TO VERIFY THE FACTS AND REFRAME THE ASSESSMENT ORDER AFRESH BY THE A.O. 3. THE HON' BLE CIT( A ) PUNE - 2,PUNE HAS ERRED IN CONFIRMING ENTIRE ADDITION OF RS.283690/ - TREATING IT AS MADE ON AGREED BASIS IGNORING THE FACT THAT DUE TO INABILITY TO RECONCILE THE FIGURES OF PURCHASES AS PER TCS CERTIFICATES AND AS PER BOOKS OF ACCOUNTS, THE APPELLANT ASSESSEE HAD TO AGR EE FOR ADDITION OF G.P. AT 10% OF DIFFERENCE OF RS.1004150/ - IN PURCHASES. IN PARA 5 OF ASSESSMENT ORDER AND PARA 6 OF THE ORDER OF THE HON' BLE CIT(A) IT IS STATED THAT GP ADDITION OF R S .283690/ - IS MADE AND THAT GP ON UN - RECONCILED FIGURE HAS BEEN TAKEN ON THE BASIS OF GROSS PROFIT RATIO SHO W N BY THE APPELLANT FOR WHICH AR OF THE ASSESSEE AGREED. THE HON' BLE ITAT PUNE IS REQUESTED TO REDUCE THE ADDITION BY RS.183275/ - RETAINING ADDITION OF RS.100415/ - I.E. 10% DIFFERENCE IN PURCHASES AS AGREED. ITA NO. 1673 /PN/20 1 5 SHRI RAOSAHEB JIJABA ANBHULE 3 3. DESPI TE SERVICE OF NOTICE, NONE APPEARED ON BEHALF OF THE ASSESSEE NOR ANY APPLICATION WAS MOVED FOR ADJOURNMENT. THE ASSESSEE HAS FILED WRITTEN SUBMISSIONS, WHICH ARE PLACED ON RECORD. 4. THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE ON THE OTHER H AND, PLACED RELIANCE ON THE ORDERS OF AUTHORITIES BELOW. 5. BRIEFLY, IN THE FACTS OF THE CASE, THE ASSESSEE DERIVES INCOME FROM MEDICAL PRACTICE AND WAS ALSO RUNNING HOSPITAL AND HOTEL. FOR THE YEAR UNDER CONSIDERATION, THE ASSESSEE HAD FURNISHED THE RET URN OF INCOME DECLARING TOTAL INCOME OF RS. 5,26,654/ - AND AGRICULTURAL INCOME OF RS.2 LAKHS. THE ASSESSING OFFICER NOTED THAT DURING THE YEAR UNDER CONSIDERATION, THE ASSESSEE HAD SOLD AN IMMOVABLE PROPERTY AND HIS SHARE IN SALE TRANSACTION WAS RS.15,56,5 00/ - , ON WHICH CAPITAL GAINS WORKED OUT TO RS. 14,45,700/ - . THE ASSESSEE HAD CLAIMED DEDUCTION UNDER SECTION 54F OF THE ACT AGAINST PURCHASE OF FLAT AT CLAIMED DEDUCTION UNDER SECTION 54F OF THE ACT AGAINST PURCHASE OF FLAT AT RS. 4,79,975/ - . THE ASSESSEE HAD ALSO SOLD AGRICULTURAL LAND ON 04.11.2010. AGAINST THE CAPITAL GAINS A RISING ON SALE OF AGRICULTURAL LAND, THE ASSESSEE CLAIMED DEDUCTION UNDER SECTION 54B OF THE ACT ON ACCOUNT OF PURCHASE OF AGRICULTURAL LANDS ON 16.07.2010 AND 30.09.2010 FOR RS.6,00,449/ - AND RS.2,10,085/ - RESPECTIVELY. THE ASSESSING OFFICER DENIED THE C LAIM OF DEDUCTION UNDER SECTION 54B OF THE ACT SINCE THE INVESTMENT WAS MADE IN PURCHASE OF AGRICULTURAL LAND PRIOR TO THE DATE OF SALE OF ORIGINAL ASSET. ANOTHER ADDITION MADE IN THE HANDS OF ASSESSEE WAS ON ACCOUNT OF GROSS PROFIT ON PURCHASE OF WINE. THE ASSESSEE WAS ASKED TO RECONCILE THE PURCHASE FIGURE OF WINE BUT HE COULD NOT DO SO AND HE REQUESTED THAT GROSS PROFIT ON INCOME OF PURCHASE SHOULD BE TAKEN. ON SECOND DAY OF HEARING ALSO, SIMILAR REQUEST WAS ITA NO. 1673 /PN/20 1 5 SHRI RAOSAHEB JIJABA ANBHULE 4 MADE THAT INCOME SHOULD BE ADOPTED @ 10% ON PURCHASES. HOWEVER, THE ASSESSING OFFICER MADE THE ADDITION AS PER GROSS PROFIT SHOWN BY THE ASSESSEE I.E. PROFIT OF RS.2,83,690/ - WAS ADDED TO THE INCOME OF ASSESSEE ON AGREED BASIS. 6. THE CIT(A) NOTED THE CONTENTION OF ASSESSEE VIS - - VIS DENIAL OF DE DUCTION UNDER SECTION 54B OF THE ACT THAT PART CONSIDERATION WAS RECEIVED PRIOR TO THE EXECUTION OF SALE DEED, WHICH IN TURN, WAS INVESTED FOR PURCHASE OF LAND. HOWEVER, THE ASSESSEE FAILED TO FURNISH ANY EVIDENCE IN THIS REGARD NOR ANY BANK STATEMENT EVI DENCING THE ADVANCE PAYMENT, ANY RECEIPT OF MONEY OR PURCHASE AND SALE DEED OR ANY OTHER DOCUMENT AND HENCE, THE SAID PLEA OF ASSESSEE WAS REJECTED. IN RESPECT OF SECOND GROUND OF APPEAL, THE CIT(A) OBSERVED THAT WHERE THE ASSESSEE HAD FAILED TO RECONCILE THE PURCHASE FIGURE OF WINE AS PER TCS CERTIFICATE, THE ASSESSING OFFICER HAD APPLIED GP RATE ON THE UN - RECONCILED PURCHASES, WHEREAS THE ASSESSEE WAS DISPUTING THE ADDITION BY STATING THAT HE HAD AGREED FOR GP ADDITION @ 10% ONLY. THE PLEA OF ASSESSEE W AS REJECTED AND THE ADDITION WAS UPHELD. 7. THE ASSESSEE IS IN APPEAL AGAINST THE ORDER OF CIT(A). 8. THE ASSESSEE HAS FILED WRITTEN SUBMISSIONS DATED 11.08.2016 WHICH ARE AVAILABLE ON RECORD. SIMILAR PLEA AS BEFORE THE AUTHORITIES BELOW WAS RAISED BEFO RE THE TRIBUNAL AND ON THE EARLIER DATE OF HEARING I.E. 22.08.2016 . T HE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE SHRI D.V. KADAM WAS DIRECTED TO FILE ENGLISH TRANSACTION OF MARATHI DOCUMENTS. THEREAFTER, THE APPEAL WAS FIXED FOR HEARING ON 19.1 0.2016. WHEN NONE APPEARED ON BEHALF OF THE ASSESSEE, THE MATTER WAS ADJOURNED TO 06.12.2016 , ON WHICH DATE ALSO ITA NO. 1673 /PN/20 1 5 SHRI RAOSAHEB JIJABA ANBHULE 5 NONE APPEARED . THOUGH, T HE WRITTEN SUBMISSIONS EARLIER FILED ON 11.08.2016 WERE PERUSED , THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVE NUE STRESSED THAT THE ASSESSEE HAS FAILED TO BRING ON RECORD ANY EVIDENCE TO SHOW THAT IT HAD RECEIVED THE AMOUNT IN ADVANCE. HE FURTHER POINTED OUT THAT IN ANY CASE, THE PROVISIONS OF SECTION 54B OF THE ACT ARE VERY CLEAR THAT THE DEDUCTION IS ALLOWABLE IN CASE THE ASSET IS PURCHASED WITHIN PERIOD OF TWO YEARS AFTER THE DATE OF SALE. 9. IN THE FACTS OF THE PRESENT CASE, THE ASSESSEE HAD SOLD THE AGRICULTURAL LAND ON 04.11.2010 AND AS PER THE PROVISIONS OF SECTION 54B OF THE ACT, THE INVESTMENT HAS TO B E MADE WITHIN PERIOD OF TWO YEARS AFTER THE DATE OF SALE . SINCE THE ASSESSEE HAD PURCHASED THE NEW AGRICULTURAL LAND ON 16.07.2010 AND ON 30.09.2010, THERE IS NO MERIT IN THE CLAIM OF ASSESSEE FOR DEDUCTION UNDER SECTION 54B OF THE ACT. ANOTHER POINT WHI CH WAS RAISED BY THE ASSESSEE WAS THAT THE INVESTMENT FOR PURCHASE OF NEW LAND OUT OF ADVANCE RECEIVED AGAINST THE SALE OF AGRICULTURAL LAND. FIRST OF ALL, THE INVESTMENT MADE IS IN VIOLATION OF PROVISIONS OF SECTION 54B OF THE ACT AND SECONDLY, DESPITE O PPORTUNITY BEING ALLOWED TO THE ASSESSEE, THE ASSESSEE HAS NOT APPEARED NOR FILED TRANSLATED COPIES OF MARATHI DOCUMENTS OF SALE DEED NOR HAS FURNISHED ANY OTHER EVIDENCE TO PROVE ITS CASE. IN VIEW THEREOF, THERE IS NO MERIT IN THE CLAIM OF ASSESSEE AND T HE SAME IS REJECTED. THE GROUND S OF APPEAL NO.1 AND 2 RAISED BY THE ASSESSEE ARE THUS, DISMISSED. 10 . IN RESPECT OF SECOND ADDITION MADE ON ACCOUNT OF UN - RECONCILED PURCHASES VIS - - VIS TCS CERTIFICATE, THE ASSESSEE HAD AGREED THAT THERE WAS DIFFERENCE IN PURCHASE FIGURE AND HAD ALSO ACCEPTED ADOPTION OF GP ADDITION ON ITA NO. 1673 /PN/20 1 5 SHRI RAOSAHEB JIJABA ANBHULE 6 THE SAID PURCHASES. HOWEVER, THE ASSESSEE OFFERED 10% ON THE SAID UN - RECONCILED PURCHASES FOR WHICH, THE ASSESSEE HAS NOT GIVEN ANY BASIS. THE ASSESSING OFFICER AND CIT(A) HAVE APPLIED THE GP RATE DECLARED BY THE ASSESSEE TO BE THE BASIS FOR COMPUTING ADDITION IN THE HANDS OF ASSESSEE VIS - - VIS UN - RECONCILED PURCHASES. THERE IS NO MERIT IN THE PLEA OF ASSESSEE IN THE ABSENCE OF ANY EVIDENCE AND IN VIEW THEREOF, THE ADDITION IS UPHELD. THE GROUND OF APPEAL NO. 3 RAISED BY THE ASSESSEE IS DISMISSED. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE ARE THUS, DISMISSED. 1 1 . IN THE RESULT, THE APPEAL OF ASSESSEE IS DISMISSED. ORDER PRONOUNCED ON THIS 9 TH D AY OF DECE MBER , 201 6 . SD/ - (SUSHMA CHOWLA) / JUDICIAL MEMBER / PUNE ; DATED : 9 TH DECEM BER , 201 6 . GCVSR / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APPELL ANT ; 2. / THE RESPONDENT; 3. ( ) / THE CIT(A) - 2 , PUNE ; 4. / THE PR. CIT - 1 , PUNE ; 5. 6. , , , - / DR SMC , ITAT, PUNE; / GUARD FILE . / BY O RDER , // TRUE COPY // / SR. PRIVATE SECRETARY , / ITAT, PUNE