SMT. KALAWANTI SACHDEV, JAIPUR V. INCOME TAX OFFICER, JAIPUR

ITA 208/JPR/2018

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 0942 (ITAT-JAIPUR)
• Duration Of Justice: 9 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-11-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 12-02-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ROSHANTA MEENA
• Assessee Lawyers: ARUN KUMAR TRIVEDI
• Keywords: Question of law
• Section: 54B; 54F

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE -B, JAIPUR JH FOT; IKY JKO] U;KF;D LNL; ,OA JH FOE FLAG ;KNO] YS[KK LNL; DS LE{K BEFORE: SHRI VIJAY PAL RAO, JM & SHRI VIKRA M SINGH YADAV, AM VK;DJ VIHY LA- @ ITA NO. 208/JP/2018 FU/KZKJ.K O'K Z @ ASSESSMENT YEAR :2009-10 SMT. KALAWANTI SACHDEV PLOT NO. 4-MA-71, JAWAHAR NAGAR, JAIPUR CUKE VS. ITO, WARD-5(3), JAIPUR LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: ALTPS1978B VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RE SPONDENT FU/KZKFJRH DH VKSJ L S@ ASSESSEE BY : SHRI ARUN KUMAR TRIVEDI (CA) JKTLO DH VKSJ LS @ REVENUE BY : SHRI ROSHANTA MEENA (JCIT) LQUOKBZ DH RKJH[ K@ DATE OF HEARING : 14/11/2018 MN?KKS'K.KK DH RKJH[ K@ DATE OF PRONOUNCEMENT: 26/11/2018 VKNS'K@ ORDER PER: VIKRAM SINGH YADAV, A.M. THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF LD. CIT(A)-2, JAIPUR DATED 17.11.2017 FOR A.Y. 2009-10. 2. THE LIMITED ISSUE UNDER DISPUTE RELATES TO NON- GRANT OF DEDUCTION U/S 54F OF THE ACT. BRIEFLY STATED, THE FACTS OF THE CA SE ARE THAT THE ASSESSEE HAS SOLD HOUSE PROPERTY FOR A TOTAL CONSIDERATION OF RS . 6,00,000/- AND HAS CLAIMED BENEFIT OF DEDUCTION U/S 54F ON ACCOUNT OF INVESTME NT OF RS. 8,42,095/- IN RESIDENTIAL HOUSE PROPERTY PURCHASED IN THE NAME OF HER HUSBAND SH. NARENDRA SETHI. THE ASSESSING OFFICER DENIED THE SAID CLAIM HOLDING THAT THE ASSESSEE CAN AVAIL DEDUCTION ONLY WHEN THE INVESTMENT IN HOU SE PROPERTY IS MADE IN THE NAME OF THE ASSESSEE ONLY. THE LD. CIT(A) RELYING ON THE DECISION OF HONBLE ITA NO. 208/JP/2018 SMT. KALAWANTI SACHDEV, JAIPUR VS. ITO, JAIPUR 2 RAJASTHAN HIGH COURT IN CASE OF KALYA VS. CIT 251 C TR 174 HAS CONFIRMED THE SAID DENIAL OF DEDUCTION U/S 54F OF THE ACT. NOW, T HE ASSESSEE IS IN APPEAL BEFORE US. 3. DURING THE COURSE OF HEARING, THE LD. AR DRAWN OUR REFERENCE TO THE DECISION OF HONBLE RAJASTHAN HIGH COURT IN CASE OF SH. MAHADEV BALAI VS. ITO (D. B. ITA NO. 136/2017 AND OTHERS DATED 07.11.2017 ) WHICH HAS CONSIDERED THE EARLIER DECISION IN CASE OF KALYA AND FOLLOWING WHICH, THE DECISION OF THIS BENCH IN CASE OF SHRI VIVEK JAIN VS. DCIT (ITA NO. 139/JP/2016 DATED 08/12/2017) WHEREIN THE DEDUCTION U/S 54F WAS ALLOW ED IN RESPECT OF RESIDENTIAL HOUSE PROPERTY PURCHASED BY THE ASSESSE E IN THE NAME OF HIS WIFE. IT WAS ACCORDINGLY SUBMITTED THAT IN VIEW OF THE SA ID DECISIONS, THE NECESSARY RELIEF MAY BE ALLOWED TO THE ASSESSEE AND THE AO MA Y BE DIRECTED TO ALLOW THE DEDUCTION U/S 54F OF THE ACT. 4. THE LD. DR IS HEARD WHO HAS RELIED ON THE ORDER OF THE LOWER AUTHORITIES. 5. IN CASE OF VIVEK JAIN (ITA NO. 139/JP/2016 DATED 08.12.2017), WE HAVE CONSIDERED THE DECISIONS OF THE HONBLE RAJASTHAN H IGH COURT IN CASE OF KALYA VS. CIT (SUPRA) AS WELL AS SUBSEQUENT DECISION OF T HE HONBLE RAJASTHAN HIGH COURT IN CASE OF SH. MAHADEV BALAI VS. ITO (SUPRA) AND OUR FINDINGS THEREIN ARE REPRODUCED AS UNDER: 9. DURING THE COURSE OF HEARING, THE LD. AR REITER ATED THE SUBMISSIONS MADE BEFORE THE LD. CIT(A). FURTHER, LD. AR ALSO DR AWN OUR REFERENCE TO THE RECENT DECISION OF HONBLE RAJASTHAN HIGH COURT IN CASE OF SH. MAHADEV BALAI VS. ITO (D.B. ITA NO. 136/2017 & OTHERS DATED 07.11 .2017) WHEREIN IN THE CONTEXT OF SECTION 54B, IT WAS HELD THAT WHERE THE INVESTMENT IS MADE IN THE ITA NO. 208/JP/2018 SMT. KALAWANTI SACHDEV, JAIPUR VS. ITO, JAIPUR 3 NAME OF THE WIFE, THE ASSESSEE SHALL BE ELIGIBLE FO R CLAIM OF DEDUCTION U/S 54B OF THE ACT. 10. IN THE SAID CASE, THE ASSESSEE HAS SOLD AGRI CULTURAL LAND AND PURCHASED ANOTHER AGRICULTURAL LAND IN THE NAME OF HIS WIFE A ND CLAIMED DEDUCTION U/S 54B OF THE ACT. THE CO-ORDINATE BENCH VIDE ITS ORDE R IN ITA NO. 333/JP/2016 DATED 26.12.2016 FOLLOWING THE DECISION OF HONBLE RAJASTHAN HIGH COURT IN CASE OF KALYA VS. CIT(SUPRA) HAD DECIDED THE ISSUE AGAINST THE ASSESSEE AND HAS CONFIRMED THE DENIAL OF DEDUCTION U/S 54B OF TH E ACT. IN THE CONTEXT OF SAID FACTS, ON APPEAL BY THE ASSESSEE, THE HONBLE RAJASTHAN HIGH COURT HAS FRAMED THE FOLLOWING SUBSTANTIAL QUESTION OF LAW: WHERE LD. ITAT WAS JUSTIFIED IN DISALLOWING THE EX EMPTION U/S 54B O F THE ACT WITHOUT APPRECIATING THAT THE FUNDS UTILIZED FOR TH E INVESTMENT FOR PURCHASE OF THE PROPERTY ELIGIBLE U/S 54B BELONGED TO THE APPEL LANT ONLY AND MERELY THE REGISTERED DOCUMENT WAS EXECUTED IN THE NAME O F TH E WIFE AND FURTHER THE WIFE HAD NOT SEPARATE SOURCE OF INCOME. 11. THE HONBLE RAJASTHAN HIGH COURT, AFTER CONSIDE RING ITS EARLIER DECISION IN CASE OF KALYA VS. CIT(SUPRA) AND THE VARIOUS OTH ER DECISIONS OF HONBLE DELHI HIGH COURT, HONBLE MADRAS HIGH COURT, HONBL E KARNATAKA HIGH COURT, HONBLE PUNJAB AND HARYANA HIGH COURT, AND HONBLE ANDHRA PRADESH HIGH COURT, AS ALSO RELIED UPON BY THE ASSESSEE, HAS HEL D THAT IT IS THE ASSESSEE WHO HAS TO INVEST AND IT IS NOT SPECIFIED IN THE LE GISLATION THAT THE INVESTMENT IS TO BE IN THE NAME OF THE ASSESSEE AND WHERE THE INVESTMENT IS MADE IN THE NAME OF WIFE, THE ASSESSEE SHALL BE ELIGIBLE FOR DEDUCTION AND HAS THUS DECIDED THE MATTER IN FAVOUR OF THE ASSESS EE. THE RELEVANT FINDINGS OF THE HONBLE RAJASTHAN HIGH COURT ARE CONTAINED A T PARA 7.2 AND 7.3 OF ITS ORDER WHICH ARE REPRODUCED AS UNDER:- ITA NO. 208/JP/2018 SMT. KALAWANTI SACHDEV, JAIPUR VS. ITO, JAIPUR 4 7.2 ON THE GROUND OF INVESTMENT MADE BY THE ASSESS EE IN THE NAME OF HIS WIFE, IN VIEW OF THE DECISION OF DELHI HIGH COURT I N SUNBEAM AUTO LTD. AND OTHER JUDGMENTS OF DIFFERENT HIGH COURTS, THE WORD USED IS ASSESSEE HAS TO INVEST, IT IS NOT SPECIFIED THAT IT IS TO BE IN THE NAME O F ASSESSEE. 7.3 IT IS TRUE THAT THE CONTENTIONS WHICH HAVE BEEN RAISED BY THE DEPARTMENT IS THAT THE INVESTMENT IS MADE BY THE AS SESSEE IN HIS OWN NAME BUT THE LEGISLATURE WHILE USING LANGUAGE HAS NOT US ED SPECIFIC LANGUAGE WITH PRECISION AND THE SECOND REASON IS THAT VIEW HAS AL SO BEEN TAKEN BY THE DELHI HIGH COURT THAT IT CAN BE IN THE NAME OF WIFE . IN THAT VIEW OF THE MATTER, THE CONTENTION RAISED BY THE ASSESSEE IS RE QUIRED TO BE ACCEPTED WITH REGARD TO SECTION 54B REGARDING INVESTMENT IN TUBEWELL AND OTHERS. IN OUR CONSIDERED OPINION, FOR THE PURPOSE OF CARRYING ON THE AGRICULTURAL ACTIVITY, TUBEWELL AND OTHER EXPENSES ARE FOR BETTE RMENT OF LAND AND THEREFORE, IT WILL BE CONSIDERED A PART OF INVESTME NT AND SAME IS REQUIRED TO BE ACCEPTED. 12. IN LIGHT OF LEGAL PROPOSITION SO LAID DOWN BY THE H ONBLE RAJASTHAN HIGH COURT IN CASE OF MAHADEV BALAI (SUPRA), WHERE THE I NVESTMENT IN THE NEW HOUSE PROPERTY HAS FLOWN FROM THE ASSESSEE, WHICH I S NOT IN DISPUTE IN THE INSTANT CASE, MERELY FOR THE REASON THAT THE NEW RE SIDENTIAL HOUSE PROPERTY HAS BEEN PURCHASED BY THE ASSESSEE IN THE NAME OF H IS WIFE, THE SAME CANNOT BE BASIS FOR THE DENIAL OF DEDUCTION CLAIMED U/S 54F OF THE ACT. 6. FOLLOWING OUR DECISION IN VIVEK JAIN (SUPRA), IN THE INSTANT CASE, WHERE THE SUBSTANTIAL CONDITION OF INVESTMENT BY THE ASSE SSEE IN THE NEW HOUSE PROPERTY FOR THE PURPOSES OF CLAIM OF DEDUCTION HAS BEEN FULFILLED, MERELY ON ACCOUNT OF THE FACT THAT THE HOUSE PROPERTY HAS NOT BEEN PURCHASED IN THE NAME OF THE ASSESSEE BUT HAS BEEN PURCHASED IN THE NAME OF THE ASSESSEES SPOUSE, THE SAME CANNOT BE A BASIS FOR DENIAL OF DE DUCTION UNDER SECTION 54F ITA NO. 208/JP/2018 SMT. KALAWANTI SACHDEV, JAIPUR VS. ITO, JAIPUR 5 OF THE ACT. IN THE RESULT, THE AO IS DIRECTED TO A LLOW THE DEDUCTION SO CLAIMED BY THE ASSESSEE UNDER SECTION 54F OF THE ACT. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWE D. PRONOUNCED IN THE OPEN COURT ON 26/11/2018. SD/- SD/- FOT; IKY JKO FOE FLAG ;KNO (VIJAY PAL RAO) (VIKRAM SINGH YADAV) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 26/11/2018 * GANESH. VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- SMT. KALAWANTI SACHDEV, JAIPUR 2. IZR;FKHZ@ THE RESPONDENT- ITO, WARD-5(3), JAIPUR 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDR@ CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR. 6. XKMZ QKBZY@ GUARD FILE {ITA NO. 208/JP/2018} VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASST. REGISTRAR