ITO, Ward-3(3)(12), Ahmedabad V. Shri Kaushalkumar Gangaram Patel, Ahmedabad

ITA 1794/AHD/2017

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 8841 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 10 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-06-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2013-2014
• Appeal Filed On: 31-07-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: LALIT P JAIN
• Keywords: Capital asset

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD C BENCH (BEFORE SHRI MAHAVIR PRASAD, JUDICIAL MEMBER & SHRI WASEEM AHMED, ACCOUNTANT MEMBER) ITA. NO: 1794/AHD/2017 (ASSESSMENT YEAR: 2013-14) INCOME-TAX OFFICER, WARD- 3(3)(12), AHMEDABAD V/S SHRI KAUSHALKUMAR GANGARAM PATEL NEAR PATEL FARM, S.G. HIGH WAY, BODAKDEV, AHMEDABAD- 380015 (APPELLANT) (RESPONDENT) PAN: ACPPP9442G APPELLANT BY : SHRI LALIT P. JAIN, SR. D. R. RESPONDENT BY : SHRI TUSHAR HEMANI, A.R. ( )/ ORDER DATE OF HEARING : 13 -06-201 9 DATE OF PRONOUNCEMENT : 17 -06-2019 PER MAHAVIR PRASAD, JUDICIAL MEMBER 1. THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAINS T THE ORDER OF THE LD. CIT(A)-3, AHMEDABAD DATED 18.05.2017 PERTAINING TO A.Y. 2013-14 AND FOLLOWING GROUNDS HAVE BEEN TAKEN: ITA NO. 1794 /AHD/2017 . A.Y. 2013-1 4 2 A. LD.CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELET ING THE ADDITION OF RS. 2,21,17,140/- MADE BY THE AO WITHOUT APPRECIATING T HE FACT THAT THE AO HAS THOROUGHLY VERIFIED THE PROVISIONS OF SECTION 2( 14 ) (III) OF THE ACT. B. LD. CIT(A) HAS ERRED IN LAW CONSIDERING THE AS SESSEE'S SUBMISSION IN THE FORM OF NOTARIZED LETTER ISSUED BY GUDA DATED 08/02/2016 WHEREIN IT IS STATED THAT THE LAND IN QUESTION IS AT DISTANCE OF ABOVE 5 KMS FROM THE OUTER LIMITS OF GANDHINAGAR MUNICIPAL CORPORATION. 2. FACTS OF THE CASE THAT DURING THE COURSE OF ASSESSM ENT PROCEEDINGS, FROM THE DETAILS FURNISHED BY THE ASSESSEE, IT HAS BEEN FOUN D THAT THE ASSESSEE HAS SOLD FOLLOWING PROPERTY: SI. NO. BLOCK NO. TOTAL SALE CONSIDERATION SHARE OF SALE CONSIDERATION RECEIVED BY ASSESSEE REGD. NO. AND DATE 1. BLOCK NO.- 94 RS.12,18,63,500/- SHARE-17% RS.2,07,16,795/- 1539 DATED 05.2.2013 2. BLOCK NO. -59 RS.3,19,72,000/- SHARE-17% RS.54,35,240/- 1542 DATED 05.2.2013 3. BLOCK NO. -244 RS.62,64,000/- SHARE- 1545 DATED RS. 10,64,8807- 05.2.2013 4. BLOCK NO. -243 RS.2,86,50,000/- SHARE -17% RS.48,70,500/- 7924 DATED 14.6.2012 5. BLOCK NO. -45 RS.71,84,750/- SHARE-17% RS.12,21,407/- 7926 DATED 14.6.2012 TOTAL SHARE RECEIVED IN SALE CONSIDERATION RS. 3,33,08,882/- 3. HOWEVER, ASSESSEE HAD NOT OFFERED ANY CAPITAL GAIN TAX ON SALE OF ABOVE MENTIONED IMMOVABLE PROPERTY. THEREFORE, VIDE ORDER SHEET ENTRY DATED 18.01.2016, THE ASSESSEE WAS REQUESTED TO FURNISH T HE JUSTIFICATION FOR NOT ITA NO. 1794 /AHD/2017 . A.Y. 2013-1 4 3 OFFERING ANY CAPITAL ON SALE OF AFORESAID LAND SITU ATED AT ADALAJ. IN RESPONSE TO THIS, THE ASSESSEE HAD FURNISHED HIS REPLY VIDE LET TER DATED 14.3.2016, WHICH IS AS UNDER: 'THE ASSESSEE LAND IS SITUATED AT ADALAJ WHICH FALL UNDER THE GUDA I.E. (GANDHINGAR URBAN DEVELOPMENT AUTHORITY) AS PER THE LETTER SUBMITTED BY THE GUDA, WHICH IS EQUIVALENT AS MUNICIPALITY. FURTHER, THE POPULATION OF THAT AREA SHOULD BE LESS THAN 10,000 AS PER THE LAST PUBLISHE D CENSUS ON THE FIRST DAY OF THE PREVIOUS YEAR. CENSUS DATA OF 2001 WAS PUBLISHED AS ON THE FIRST DAY OF THE PREVIOUS YEAR ON THE WEBSITE OF THE CENSUS, AND STI LL TODAY 2011 CENSUSDATA IS PROVISION DATA AND WHICH IS STILL NOT PUBLISHED AS ON FIRST DAY OF THE PREVIOUS YEAR. WE ARE ENCLOSING HEREWITH THE COPY OF 2001 CENSUS W HICH IS AVAILABLE AS ON THE FIRST DAY OF THE PREVIOUS YEAR IS ENCLOSED HEREWITH AND THE SAME IS MARKED AS ANNEXURE... THAT THE ASSESSEE LAND IS SITUATED AT ADALAJ WHICH IS OUTSIDE THE LIMITS OFGANDHINAGAR AND AS PER THE PROVISION, LAND SHOULD BE SITUATED CERTAIN KILOMETER AWAY FROM THE GANDHINAGAR MUNICIPALITY, A ND AS PER THE NOTIFICATION NO. 9447 DATED 06/01/1994 OF THE DEPARTMENT OF REVE NUE HAD SPECIFIED AREA UP- TO 4 K.M. FROM THE MUNICIPALITY LIMITS OF GANDHINAG AR AS URBAN AREA. FURTHER, ANY PROPERTY SITUATED OUTSIDE THE 4 KM WILL BE CONS IDERED AS THE RURAL AREA. THAT THE LETTER GIVEN BY THE GUDA CLEARLY MENTION T HAT THE LAND IS 5 KM AWAY FROM THE GANDHINAGAR MUNICIPALITY, HENCE THE ABOVE CONDITION IS FULFILLED THAT THE LAND IS AWAY FROM THE MUNICIPALITY LIMIT AND HE NCE QUALIFY THE RURAL AGRICULTURE LAND. HENCE, LOOKING TO THE ABOVE FACTS AND CIRCUMSTANCE THE LAND IN ANY CASE QUALIFY FOR THE RURAL , CAPITAL ASSETS AND IS EXEMPT FROM T HE CAPITAL GAIN.' 4. BUT LD. A.O. WAS NOT CONVINCED WITH THE CONTENTION OF THE ASSESSEE AND HELD SINCE ADALAJ VILLAGE IS SITUATED 0.8 KM FROM THE AH MEDABAD MUNICIPAL CORPORATION. THEREFORE LAND IN QUESTION IS A CAPITA L ASSETS AS PER INCOME TAX ACT AND MADE ADDITION OF RS. 22117140/- ON ACCOUNT OF LONG TERM CAPITAL GAIN. 5. AGAINST THE SAID ORDER, ASSESSEE PREFERRED FIRST ST ATUTORY APPEAL BEFORE THE LD. CIT(A) WHO ALLOWED THE APPEAL OF THE ASSESSEE BY HO LDING THAT LAND IN QUESTION ITA NO. 1794 /AHD/2017 . A.Y. 2013-1 4 4 IS SITUATED AT ADALAJ AND REVENUE DISTRICT IS GANDH INGAR AND HELD MUNICIPAL LIMIT OF GANDHINAGAR TO BE CONSIDERED WHILE CONSIDERING T HE FACT THAT WHETHER LAND IN QUESTION IS A CAPITAL ASSETS OR NOT U/S. 2(14)(I II) OF THE ACT AND HENCE CONSIDERATION RECEIVED BY THE ASSESSEE IS EXEMPT AS PER PROVISIONS OF THE ACT AND GRANTED RELIEF TO THE ASSESSEE. 6. NOW BY WAY OF SECOND APPEAL, REVENUE HAS COME BEFOR E US. 7. WE HAVE GONE THROUGH THE IMPUGNED ORDER AND HEARD B OTH THE PARTIES. UNDISPUTEDLY LAND IS SITUATED AT VILLAGE ADALAJ REV ENUE DISTRICT GANDHINAGAR AND LAND IN QUESTION IS 5 KM OUTSIDE THE RADIOUS OF GANDHINAGAR MUNICIPAL CORPORATION AND WE DRAW SUPPORT FROM THE LETTER ISS UED BY THE GANDHINAGAR URBAN DEVELOPMENT AUTHORITY JUNIOR TOWN PLANNING OF FICER WHO HAS SPECIFICALLY MENTIONED THAT LAND IN QUESTION IS SIT UATED OUTSIDE 5KM RADIOUS OF GANDHINAGAR MUNICIPAL CORPORATION VIDE LETTER NO. G UDA/TECH/692/2015 LETTER DATED 08.02.2016. 8. WE HAVE ALSO GONE THROUGH THE NOTIFICATION NO. 9447 DATED 06.01.1994 ISSUED BY THE GOVT. OF GUJARAT WHEREIN IT IS MENTIONED THA T ADALAJ (CT) (GUJ, POPULATION: 9776, CLASS-V) AND MUNICIPAL LIMIT IS A REA UP TO A DISTANCE OF 4 KM FROM THE MUNICIPAL LIMITS IN ALL DIRECTION WHEREAS LAND IN QUESTION IS OUTSIDE THE 5 KM RADIOUS OF GANDHINAGAR MUNICIPAL CORPORATION A ND AS PER SECTION 2(14)(III)(A) CAPITAL ASSET MEANS PROPERTY OF ANY K IND HOLD BY AN ASSESSEE, WHETHER OR NOT CONNECTED WITH HIS BUSINESS OR PROFE SSION AND AGRICULTURAL LAND IN INDIAN, NOT BEING LAND SITUATE (A) IN ANY AREA W HICH COMPRISED WITHIN THE JURISDICTION OF A MUNICIPALITY (WHETHER KNOWN AS MU NICIPALITY, MUNICIPAL CORPORATION, NOTIFIED AREA COMMITTEE, TOWN AREA COM MITTEE, TOWN COMMITTEE, ITA NO. 1794 /AHD/2017 . A.Y. 2013-1 4 5 OR BY ANY OTHER NAME) OR A CANTONMENT BOARD AND WHI CH HAS A POPULATION NOT LESS THAN 10,000. 9. IN THIS CASE, AGRICULTURAL LAND IN QUESTION IS SITU ATED BEYOND 5KM RADIOUS OF GANDHINAGAR MUNICIPAL CORPORATION AND IN OUR CONSID ERED OPINION, SAME IS AGRICULTURAL LAND WHICH IS NOT A CAPITAL ASSET AS P ER INCOME TAX ACT. THEREFORE, WE ARE NOT INCLINED TO INTERFERE IN THE ORDER PASSE D BY THE LD. CIT(A). THUS, WE DISMISS THIS GROUND OF APPEAL OF THE REVENUE. 10. IN THE RESULT, APPEAL FILED BY THE REVENUE IS DISMI SSED. ORDER PRONOUNCED IN OPEN COURT ON 17 - 06- 2019 SD/- SD/- (WASEEM AHMED) (MAHAVIR PRASAD) ACCOUNTANT MEMBER TRUE COPY JUDICIAL MEMBER AHMEDABAD: DATED 17/06/2019 RAJESH COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT,AHME DABAD