The ITO, Ward-8(2), Surat V. Shri Jayantibhai D.Patel, Surat

ITA 1802/AHD/2012

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 94460 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 1 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-09-2015
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 11-09-2015
• Assessment Year: 2003-2004
• Appeal Filed On: 16-08-2012
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: NARENDRA SINGH
• Keywords: Cost of acquisition
• Section: 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD B BENCH AHMADABAD , BEFORE: SHRI G. D. AGARWAL, VICE PRESIDENT SHRI RAJPAL YADAV, JUDICIAL MEMBER ITA NO. 1802/AHD/2012 ASSESSMENT YEAR :2003-04 THE INCOME-TAX OFFICER, WARD 8(2), SURAT PIN-395001 V/S . SHRI JAYANTIBHAI D. PATEL B/H. MOTI BAHUCHARJI MANDIR, VED ROAD, SURAT. PAN NO. NO PAN (APPELLANT) .. (RESPONDENT) BY REVENUE SHRI NARENDRA SINGH, SR. D.R. /BY ASSESSEE NONE /DATE OF HEARING 11.09.2015 /DATE OF PRONOUNCEMENT 29.09.2015 O R D E R PER : RAJPAL YADAV, JUDICIAL MEMBER THIS APPEAL IS DIRECTED AT THE INSTANCE OF REVENUE AGAINST THE ORDER OF LD. CIT(A)-V, SURAT, DATED 22.05.2012 PASSED FOR A.Y.20 03-04. 2. THE NOTICE OF HEARING HAS BEEN SERVED UPON THE A SSESSEE THROUGH REGISTERED POST BUT IN SPITE OF SERVICE OF NOTICE, NO-ONE HAS COME PRESENT ON ITA NO. 1802/AHD/12 A.Y. 03-04 (ITO VS. SHRI JAYANT IBHAI D. PATEL) PAGE 2 BEHALF OF THE ASSESSEE. THEREFORE, WITH THE ASSIST ANCE OF LD. SR. D.R., WE HEARD THE APPEAL EX PARTE QUA ASSESSEE. 3. THOUGH, THE REVENUE HAS RAISED THREE GROUNDS OF APPEAL BUT ITS GRIEVANCE REVOLVES AROUND A SINGLE ISSUE WHEREBY IT HAS CHALL ENGED THE DELETION OF ADDITION OF RS.50,00,000/- ADDED BY THE ASSESSING OFFICER ON ACCOUNT OF UNEXPLAINED CAPITAL GAIN ROSE TO THE ASSESSEE. 4. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E HAD NEVER FILED RETURN OF INCOME. HE HAD NOT OBTAINED PAN ALSO. A SURVEY U/ S. 133(A) OF THE INCOME TAX ACT, 1961, WAS CARRIED OUT ON 26 TH MARCH, 2009 AT THE PREMISES OF GHANSHYAM D. SUTARIYA. DURING COURSE OF SURVEY PRO CEEDINGS, SOME INCRIMINATING DOCUMENTS WERE FOUND IN THE NAME OF A SSESSEE JAYANTIBHAI D. PATEL. ONE OF THE DOCUMENT IS A COPY OF THE AGREEM ENT OF SALE FOR THE PLOT OF LAND BEARING SURVEY NO.106/4 AT KATARGAM, SURAT. T HIS DOCUMENT WAS SEIZED. AS PER THE SALE AGREEMENT, THERE WAS INSTANCES OF C ASH TRANSACTION OF SALE OF THE ABOVE LAND TO THE AMOUNT OF RS.50 LACS BY THE ASSES SEE. ON THE BASIS OF THIS DOCUMENT, A NOTICE U/S.148 OF THE INCOME TAX ACT WA S ISSUED AND SERVED UPON THE ASSESSEE. HOWEVER, THE ASSESSEE DID NOT SUBMIT ANY REPLY DISCLOSING, WHETHER HE HAD FILED HIS RETURN OF INCOME FOR A.Y. 2003-04 OR NOT. THE ASSESSEE ALSO DID NOT SEEK COPIES OF REASONS FOR REOPENING. ACCORDING TO THE LD. ASSESSING OFFICER, THE ASSESSEE WAS ASKED TO SUBMIT RETURN ALONG WITH COMPUTATION OF INCOME, CASH BOOK, BANK STATEMENT ET C. BUT HE DID NOT COMPLY WITH THE NOTICE ISSUED U/S.142(1). UNDER THESE CIR CUMSTANCES, LD. ASSESSING OFFICER HAD PROCEEDED TO PASS EX PARTE ASSESSMENT O RDER AGAINST THE ASSESSEE. ACCORDING TO HIS PAST JUDGMENT U/S/ 144 OF THE INCO ME TAX ACT, THE LD. ASSESSING OFFICER HAS PASSED THE ASSESSMENT ORDER O N 24.12.2010. HE COMPUTED CAPITAL GAIN OF RS.50 LACS IN THE HANDS OF ASSESSEE ON THE BASIS OF SALE AGREEMENT FOUND DURING THE COURSE OF SURVEY. ITA NO. 1802/AHD/12 A.Y. 03-04 (ITO VS. SHRI JAYANT IBHAI D. PATEL) PAGE 3 5. DISSATISFYING WITH THE ASSESSMENT ORDER, ASSESSE E CARRIED THE MATTER BEFORE LD. CIT(A). THE FIRST APPELLATE AUTHORITY H AS DELETED THE ADDITION BY OBSERVING AS UNDER: 6. I HAVE GONE THROUGH THE ASSESSMENT ORDER AND AL SO THE SUBMISSIONS MADE BY THE LEARNED AR OF THE APPELLANT. I AM INCLINED TO AGREE WITH THE SUBMISSION OF THE A.R. THAT SATAKHAT IS NOT AN EVIDENCE OF TRANSFER O F PROPERTY. IN THE EYE OF LAW, UNLESS THE PROPERTY IS NOT TRANSFERRED TO PURCHASER BY WAY OF EITHER POSSESSION OR REGISTRATION, THE CAPITAL GAIN CANNOT BE TAXED. THE A.O. HAS NOT BROUGHT AY EVIDENCE ON THE RECORD THAT CAN PROVE THAT THE POSSESSION OF THE PROPERTY HAS BEEN GIVEN TO THE PURCHASER OR REGISTRATION HAS BEEN COMPLETED. HENCE , IN MY OPINION, THE TAXATION OF CAPITAL GAIN ON THE BASIS OF SATAKHAT IS NOT CORREC T. ACCORDINGLY, THE ADDITION MADE ON THIS ACCOUNT IS HEREBY DELETED AND THE GROUND OF APPEAL IS ALLOWED. 7. IN THE RESULT, THE APPEAL IS ALLOWED. 6. WITH THE ASSISTANCE OF LD. D.R., WE HAVE GONE TH ROUGH THE RECORD CAREFULLY. ON DUE CONSIDERATION OF THE RECORD, WE ARE OF THE OPINION THAT ORDER OF THE LD. FIRST APPELLATE AUTHORITY IS NOT SUSTAIN ABLE AND THIS ISSUE DESERVES TO BE SET ASIDE TO THE FILE OF ASSESSING OFFICER FOR R E-ADJUDICATION. IT EMERGES OUT FROM THE RECORD THAT DURING COURSE OF SURVEY CARRIE D OUT AT THE PREMISES OF THIRD PERSON, COPY OF THE ALLEGED SALE AGREEMENT WAS FOUN D. THIS DOCUMENT HAS BEEN MADE AS A BASIS FOR CONCLUDING THAT ASSESSEE HAD SO LD A PIECE OF LAND WHICH HAS RESULTED HIM CAPITAL GAIN. LD. ASSESSING OFFICER H AS TOTALLY FAILED TO NOTICE WHETHER ASSESSEE WAS ACTUALLY OWNER OF THIS LAND. HE FAILED TO COLLECT INFORMATION FROM THE OFFICE OF THE REGISTRAR EXHIBI TING WHETHER THE LAND HAS ACTUALLY BEEN TRANSFERRED OR NOT. IF THE LAND HAD ACTUALLY BEEN TRANSFERRED THEN WHETHER A LONG TERM CAPITAL GAIN HAS RESULTED TO TH E ASSESSEE OR A SHORT TERM CAPITAL GAIN. WHAT WAS THE COST OF ACQUISITION IN THE HANDS OF THE ASSESSEE NOT DISCERNABLE, THE LD.AO HAS ADDED TOTAL SALE CONSIDE RATION AS GAIN. ON APPEAL, LD. FIRST APPELLATE AUTHORITY FAILED TO GIVE ANY FINDIN G EXHIBITING HIS SATISFACTION FOR CONCLUDING THAT NO PROPERTY WAS TRANSFERRED. T HE ASSESSMENT ORDER IS AN EX PARTE ORDER. THE ASSESSEE HAS NOT BROUGHT ANY EVID ENCE ON RECORD IN REBUTTING THE CONCLUSION OF THE ASSESSING OFFICER. THE LD. C IT(A) HAS REPRODUCED THE SUBMISSIONS OF THE ASSESSEE WHEREBY HE HAS CONTENDE D THAT PLOT IN DISPUTE WAS ITA NO. 1802/AHD/12 A.Y. 03-04 (ITO VS. SHRI JAYANT IBHAI D. PATEL) PAGE 4 OWNERED BY 15 PERSONS JOINTLY. THOUGH, AGREEMENT W AS EXECUTED BUT ALL THE OWNERS DID NOT AGREE FOR SALE OF THE PLOT AND THERE FORE, NO SALE HAD TAKEN PLACE. IN SUPPORT OF THIS, ASSESSEE HAS FILED A COPY OF FO RM NO.7/12, BUT TO OUR MIND, THIS IS NOT A CONCLUSIVE PROOF OF OWNERSHIP. THE A UTHORITIES OUGHT TO HAVE OBTAINED THE REPORT FROM THE REVENUE AUTHORITIES OF THE STATE GOVERNMENT. LD. CIT(A) ALSO DID NOT CALL FOR A REMAND REPORT FROM T HE ASSESSING OFFICER ON THIS FRESH EVIDENCE TAKEN INTO CONSIDERATION BY HIM. TH EREFORE, THE ORDER OF THE CIT(A) IS ALSO NOT SUSTAINABLE. CONSIDERING ALL TH ESE FACTORS, WE SET ASIDE THE ORDER OF THE CIT(A) AND RESTORE THIS ISSUE TO THE F ILE OF ASSESSING OFFICER FOR A FRESH ADJUDICATION. THE OBSERVATIONS MADE BY US WI LL NOT IMPAIR OR INJURE THE CASE OF THE ASSESSING OFFICER AND WILL NOT CAUSE AN Y PREJUDICE TO THE DEFENSE/EXPLANATION OF THE ASSESSEE. LD. ASSESSING OFFICER SHALL PROVIDE DUE OPPORTUNITY OF HEARING TO THE ASSESSEE. 7. IN THE RESULT, THE APPEAL OF REVENUE IS ALLOWED FOR STATISTICAL PURPOSE. THIS ORDER PRONOUNCED IN OPEN COURT ON 29.9.2015 SD/- SD/- ( G. D. AGRAWAL) (RAJPAL YADAV) VICE PRESIDENT JUDI CIAL MEMBER