Smt. Supriya Madhukar Borge, Pune V. Income-tax Officer,

ITA 2109/PUN/2014

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 2518 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 3 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-03-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 02-02-2016
• Assessment Year: 2004-2005
• Appeal Filed On: 24-11-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K BIJU
• Keywords: Principle of natural justice; Condonation of delay
• Section: 143(3); 54F

Judgement Text

- IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH SMC , PUNE , , BEFORE MS. SUSHMA CHOWLA, JM AND SHRI PRADIP KUM AR KEDIA , AM . / ITA NO. 2109 /PN/201 4 / ASSESSMENT YEAR : 20 0 4 - 05 SMT. SUPRIYA MADHUKAR BORGE, S.NO.16/2/3, SAI RATNA APARTMENT, ANANDNAGAR, PUNE 411051 . / APPELLANT PAN: A HDPB4203G VS. THE INCOME TAX OFFICER , WARD 1( 3 ), PUNE . / RESPONDENT / APPELLANT BY : SHRI KISHORE PHADKE / RESPONDENT BY : SHRI S.K. BIJU / DATE OF HEARING : 02 . 0 2 .201 6 / DATE OF PRONOUNCEMENT: 18 . 0 3 .201 6 / ORDER PER SUSHMA CHOWLA, J M : TH IS APPEAL FILED BY THE ASSESSEE IS AGAINST THE ORDER OF CIT (A) - I , PUNE , DATED 30 . 0 4 .20 1 4 RELATING TO ASSESSMENT YEAR 20 0 4 - 05 AGAINST ORDER PASSED UNDER SECTION 143(3) OF THE INCOME - TAX ACT , 1961 (IN SH ORT THE ACT) . 2 . THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: - 1 . THE LEARNED CIT(A) - I, PUNE & THE LEARNED ITO, WARD 1(3), PUNE ERRED IN LAW AND ON FACTS IN DISALLOWING THE CLAIM OF EXEMPTION U/S 54F OF THE ITA, 1961, ON SALE OF PLOT AT WAD GAON, PUNE; ON THE REASON THAT THE APPELLANT OWNS TWO RESIDENTIAL HOUSES ON THE DATE OF SALE OF THE SAID PLOT OF LAND. 2. THE LEARNED CIT(A) & THE LEARNED ITO ERRED IN NOT APPRECIATING THAT THE APPELLANT OWNS MERELY 1 /3 RD SHARE IN BOTH THE RESIDENTIAL HO USES AND ITA NO. 2109 /PN/20 1 4 SMT. SUPRIYA MADHUKAR BORGE 2 THAT, 1/3 RD SHARE / INTEREST IN THE TWO RESIDENTIAL HOUSES IS NOT THE SAME AS OWNING TWO RESIDENTIAL HOUSES. 3. THE LEARNED CIT(A) - I, PUNE, ERRED IN LAW AND ON FACTS IN NOT APPRECIATING APPELLANT'S ENDEAVOR OF GETTING THE HOUSE PROPERTY, I.E. FL AT N O. G - I IN 'DREAM CLASSIC', KOTHRUD TRANSFERRED IN THE NAME OF APPELLANT'S TWO CHILDREN AS PER THE WISH OF THE LATE HUSBAND OF THE APPELLANT. BOTH THE AUTHORITIES OUGHT TO HAVE APPRECIATED THAT THE APPELLANT HELD THE SAID FLAT AT 'DREAM CLASSIC' ONLY AS A TRUSTEE AND ON BEHALF OF THE TWO CHILDREN. 4. THE LEARNED CIT(A) & THE LEARNED ITO FURTHER ERRED IN LAW AND ON FACTS IN TAXING 100% OF THE CAPITAL GAIN ON SALE OF THE PLOT AT WADGAON, PUNE IN THE HANDS OF THE APPELLANT. BOTH THE AUTHORITIES ERRED IN N OT APPRECIATING THAT APPELLANT HAS ONLY A 1 /3 RD SHARE IN THE SAID PLOT OF LAND AND HENCE, ONLY 1 /3 RD SHARE OF THE RIGHTFUL CAPITAL GAIN OUGHT TO HAVE BEEN TAXED IN THE HANDS OF THE APPELLANT. 5. THE APPELLANT CRAVES LEAVE TO ADD / MODIFY / ALTER / DELETE ALL / ANY OF THE GROUNDS OF APPEAL. 3 . THE ASSESSEE ALSO RAISED AN ADDITIONAL GROUND OF APPEAL, WHICH READS AS UNDER: - OUT OF THE TOTAL LONG TERM CAPITAL GAIN OF RS.5,98,447/ - , 2/3 RD PORTION THEREOF, IS ATTRIBUTABLE TO THE TWO CHILDREN OF THE APPELLANT, WHO ARE ELIGIBLE FOR EXEMPTION U/S 54F; AND AS SUCH, THE SAID 2/3 RD PORTION OF CAPITAL GAINS OUGHT NOT TO BE TAXED IN APPELLANTS HANDS. 4. THE PRESENT APPEAL WAS FILED BY THE ASSESSEE AFTER DELAY OF 17 DAYS. IN 4. THE PRESENT APPEAL WAS FILED BY THE ASSESSEE AFTER DELAY OF 17 DAYS. IN THIS REGARD, THE ASSESSEE HAS MOVED AN AP PLICATION FOR CONDONATION OF DELAY AND HAS ALSO FILED AN AFFIDAVIT BY WHICH, SHE HAS ADMITTED THAT THE APPELLATE ORDER WAS RECEIVED BY HER ON 08.09.2014. HOWEVER, THERE WAS SOME CONFUSION IN FILING THE APPEAL AND BECAUSE OF THEFT IN THE PREMISES OF COUNSE L OF THE ASSESSEE, ALL THE RELATED DOCUMENTS WERE MISSING AND ONLY THE APPELLATE ORDER WAS AVAILABLE. SINCE THE MISSING DOCUMENTS WERE REQUIRED FOR PREPARING MEMO OF APPEAL, DUPLICATE COPIES WERE OBTAINED FROM THE OFFICE OF CIT(A) - I, PUNE AND HENCE, THERE WAS DELAY OF ABOUT 15 DAYS . I N ACTUAL FACT, THE DELAY IS OF 17 DAYS. IN THE ENTIRETY OF THE ABOVE SAID FACTS AND CIRCUMSTANCES, WE CONDONE THE DELAY OF 17 DAYS AND PROCEED TO DECIDE THE PRESENT APPEAL AFTER HEARING THE LEARNED AUTHORIZED REPRESENTATIVES . 5. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE AT THE OUTSET STATED THAT THE GROUNDS OF APPEAL NO.1 TO 3 ARE NOT PRESSED AND ONLY RELIEF IS ITA NO. 2109 /PN/20 1 4 SMT. SUPRIYA MADHUKAR BORGE 3 SOUGHT VIDE GROUND OF APPEAL NO.4 IN THE ORIGINAL GROUNDS OF APPEAL. FURTHER, THE GROUND OF APPEAL NO .5 RAISED BY THE ASSESSEE WAS GENERAL IN NATURE AND HENCE, THE SAME WAS NOT MAINTAINABLE. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE THEN POINTED OUT THAT AN ADDITIONAL GROUND OF APPEAL HAS BEEN RAISED, WHICH IS PURELY LEGAL AND HENCE, THE SAM E IS MERITS TO BE ACCEPTED. 6. THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE OBJECTED TO THE ADMISSION OF ADDITIONAL GROUND OF APPEAL. 7. WE FIND THAT THE ISSUE OF CLAIM OF EXEMPTION UNDER SECTION 54F OF THE ACT BY THE TWO CHILDREN OF ASSES SEE, WHOSE INCOME IS BEING CLUBBED IN THE HANDS OF ASSESSEE IS PURELY LEGAL AND THE SAME IS ADMITTED. 8. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE FURTHER POINTED OUT THAT AFTER THE EXPIRY OF HUSBAND OF THE ASSESSEE, SH E ALONG WITH TWO MINOR CHILDREN HAD SOLD THE PROPERTY AND BY MISTAKE, THE ASSESSEE HAD DECLARED FULL CAPITAL GAINS IN HER HANDS ITSELF. THE ASSESSING OFFICER HAD DENIED THE EXEMPTION UNDER SECTION 54F OF THE ACT BECAUSE THE ASSESSEE WAS FULL OWNER OF TWO PROPERTIES. HOWEVER, B EFORE US, THE ASSESSEE HAS RAISED THE CLAIM THAT SHE HAS 1/3 RD SHARE IN THE SAID PROPERTY AND THE BALANCE 2/3RD SHARE BELONGS TO HER CHILDREN. FURTHER, VIDE GROUND OF APPEAL NO.4, THE ISSUE RAISED IS THAT ONLY 1/3 RD SHARE IN THE SALE OF THE SAID PLOT IS T O BE ADDED IN THE HANDS OF ASSESSEE. VIDE THE ADDITIONAL GROUND OF APPEAL , THE ISSUE RAISED IS THE ALLOWING OF EXEMPTION UNDER SECTION 54F OF THE ACT AGAINST THE LONG TERM CAPITAL GAINS TO BE ASSESSED IN THE HANDS OF CHILDREN OF ASSESSEE. 9. THE LEARNE D DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE PLACED RELIANCE ON THE ORDERS OF AUTHORITIES BELOW. ITA NO. 2109 /PN/20 1 4 SMT. SUPRIYA MADHUKAR BORGE 4 10. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. IN THE FACTS OF THE PRESENT CASE, FOR THE YEAR UNDER CONSIDERATION, THE ASSESSEE HAD SOLD A P LOT AT WADGAON (BK), PUNE AND HAD ALSO PURCHASED A FLAT AT SADASHIV PETH, PUNE AND CLAIMED DEDUCTION UNDER SECTION 54F OF THE ACT. ON VERIFICATION OF THE RETURN OF INCOME, THE ASSESSING OFFICER NOTED THAT THE ASSESSEE HAD DECLARED HOUSE PROPERTY INCOME FR OM TWO HOUSES I.E. FLATS OTHER THAN THE FLAT PURCHASED AT SADASHIV PETH, PUNE. IN VIEW THEREOF, AFTER CONSIDERING THE ISSUE AND EXAMINING VARIOUS EVIDENCES FILED BY THE ASSESSEE, THE ASSESSING OFFICER HELD THAT THE CLAIM OF EXEMPTION UNDER SECTION 54F OF THE ACT WAS NOT ALLOWABLE SINCE THE ASSESSEE HAD ALREADY OWNED TWO OTHER PROPERTIES. BEFORE THE ASSESSING OFFICER, THERE WAS NO CLAIM OTHER THAN, THE SAME. 11. THE CIT(A) NOTED THE CIRCUMSTANCES OF THE FAMILY OF ASSESSEE, WHERE SHE HAD LOST HER HUSBAND IN ROAD ACCIDENT ON 22.02.2001 AND HAD BECOME WIDOW AT A YOUNG AGE OF 32 YEARS AND HAD TO LOOK AFTER HER TWO MINOR CHILDREN. WIDOW AT A YOUNG AGE OF 32 YEARS AND HAD TO LOOK AFTER HER TWO MINOR CHILDREN. AFTER CONSIDERING THE ISSUE AT LENGTH, THE CIT(A) UPHELD THE ORDER OF ASSESSING OFFICER IN HOLDING THE ASSESSEE NOT ELIGIBLE FOR DEDUCTION UNDER SECTION 54F OF THE ACT SINCE SHE ALREADY OWNED TWO OTHER ASSETS ON THE DATE OF SALE OF PLOT AT WADGAON. WITH REGARD TO SECOND CONTENTION OF THE ASSESSEE THAT THE PRO PERTY WAS IN THE JOINT NAMES I.E. IN HER NAME AND TWO MINOR SONS AND SHE W A S NOT THE EXCLUSIVE OWNER OF THE SAME AND THEREFORE, SHE COULD NOT BE SAID TO BE THE OWNER OF PLOT, IN VIEW OF SECTION 54F OF THE ACT WAS ALSO DECIDED AGAINST THE ASSESSEE. HOWEVER, BEFORE US THE ASSESSEE HAS RAISED ANOTHER CLAIM THAT THE CAPITAL GAINS O N SALE OF PLOT AT WADGAON IS TO BE ASSESSED IN THE HANDS OF ASSESSEE ONLY TO THE EXTENT OF 1/3 RD SHARE IN THE PROPERTY SINCE THE BALANCE 2/3 RD SHARE BELONGS TO HER CHILDREN. FURTHER, THE ISSUE RAISED VIDE ADDITIONAL GROUND OF APPEAL IS THAT THE BENEFIT OF SECTION 54F OF THE ACT IS ALLOWABLE IN THE HANDS OF MINOR CHILDREN OF THE ASSESSEE SINCE THEY ARE ALSO JOINT OWNERS OF NEW FLAT ITA NO. 2109 /PN/20 1 4 SMT. SUPRIYA MADHUKAR BORGE 5 PURCHASED AND THEY HAVE NO OTHER ASSETS EXCEPT THE NEW FLAT . WE FIND THAT ALL THESE ASPECTS WERE NOT BEFORE THE ASSESSING OFFI CER OR CIT(A). HOWEVER, WE FIND MERIT IN THE CLAIM MADE BY THE ASSESSEE BEFORE US. IN VIEW THEREOF, FOLLOWING THE PRINCIPLES OF NATURAL JUSTICE, WE DEEM IT FIT TO RESTORE THIS ISSUE BACK TO THE FILE OF ASSESSING OFFICER, WHO SHALL CONSIDER THE CLAIM OF A SSESSEE AND DECIDE THE ISSUE IN ACCORDANCE WITH LAW AFTER AFFORDING REASONABLE OPPORTUNITY OF HEARING TO THE ASSESSEE. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE ARE THUS, PARTLY ALLOWED FOR STATISTICAL PURPOSES . 12 . IN THE RESULT, THE APPEAL OF THE AS SESSEE IS PARTLY ALLOWED FOR STATISTICAL PU R POSES . ORDER PRONOUNCED ON THIS 18 TH DAY OF MARCH , 201 6 . SD/ - SD/ - SD/ - SD/ - (PRADIP KUMAR KEDIA) (SUSHMA CHOWLA) / ACCOUNTANT MEMBER / JUDICIAL MEMBER / PUNE ; DATED : 18 TH MARCH , 201 6 . GCVSR / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APPE LLANT ; 2. / THE RESPONDENT; 3. ( ) / THE CIT(A) - I, PUNE ; 4. / THE CIT - I , PUNE ; 5. , , , - / DR SMC , ITAT, PUNE; / BY ORDER , // TRUE COP Y // / SR. PRIVATE SECRETARY , / ITAT, PUNE