ITO, Theni V. Shri M. Asokan, Theni

ITA 2124/CHNY/2016

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 7361 (ITAT-CHENNAI)
• Duration Of Justice: 2 year(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-07-2018
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2012-2013
• Appeal Filed On: 14-07-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: M MATHIVANAN
• Assessee Lawyers: R SRINIVASAN

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, CHENNAI . . . , . !'# ! , % !& BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ./ ITA NO.2124/CHNY/2016 ( )( / ASSESSMENT YEAR : 2012-13 THE INCOME TAX OFFICER, WARD 1, THENI. V. SHRI M. ASOKAN, S/O (LATE) MADASAMY, DOOR NO.61, JEGANNATHA STREET, ALLINAGARAM, THENI 625 531. PAN : ACKPA 0293 K (+,/ APPELLANT) (-.+,/ RESPONDENT) +, / 0 / APPELLANT BY : SHRI M. MATHIVANAN, ADDL. CIT -.+, / 0 / RESPONDENT BY : SHRI R. SRINIVASAN, ADVOCATE 1 / 2% / DATE OF HEARING : 28.06.2018 3') / 2% / DATE OF PRONOUNCEMENT : 17.07.2018 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER: THIS APPEAL OF THE REVENUE IS DIRECTED AGAINST T HE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) -1, MADURA I, DATED 25.04.2016 AND PERTAINS TO ASSESSMENT YEAR 2012-13. 2 I.T.A. NO.2124/CHNY/16 2. SHRI M. MATHIVANAN, THE LD. DEPARTMENTAL REPRESE NTATIVE, SUBMITTED THAT DURING THE COURSE OF SURVEY IN THE C ASE OF DR.N.R.T.R. THIAGARAJAN ON 28.11.2013, IT WAS FOUND THAT THE ASSESSEE ENTERED INTO AN AGREEMENT WITH DR. N.R.T.R . THIAGARAJAN. AS PER THE SALE AGREEMENT IMPOUNDED, THE ASSESSEE A GREED RECEIPT OF 1,14,00,000/-. SUBSEQUENTLY, ACCORDING TO THE LD. D.R., THE POWER OF ATTORNEY ISSUED BY THE OWNER IN FAVOUR OF THE ASSESSEE WAS CANCELLED AND ANOTHER POWER OF ATTORNEY WAS EXE CUTED IN FAVOUR OF THE MOTHER OF DR. N.R.T.R. THIAGARAJAN AN D ON THE SAME DAY, THE SALE DEED WAS ALSO EXECUTED IN FAVOUR OF S AID DR. N.R.T.R. THIAGARAJAN. THEREFORE, ACCORDING TO THE LD. D.R., THE ASSESSING OFFICER FOUND THAT THERE WAS A TRANSFER OF PROPERTY AND THE ASSESSEE RECEIVED 1,14,00,000/- AND COMPUTED THE PROFIT. ON APPEAL B Y THE ASSESSEE, THE CIT(APPEALS) FOUND THAT IT IS FOR THE PARTIES TO FILE CIVIL SUIT FOR RECOVERY OF 1,14,00,000/- AND IT CANNOT BE ASSESSED IN THE HANDS OF THE PRESENT ASSESSEE. ACCORDING TO THE LD . D.R., WHEN THE ASSESSEE RECEIVED THE MONEY AND RETAINED THE SA ME AND THERE WAS NO LIABILITY TO REFUND, THE SAME HAS TO BE ASSE SSED AS INCOME OF THE ASSESSEE. THEREFORE, ACCORDING TO THE LD. D.R. , THE CIT(APPEALS) IS NOT JUSTIFIED IN ALLOWING THE CLAIM OF THE ASSESSEE. 3 I.T.A. NO.2124/CHNY/16 3. ON THE CONTRARY, SHRI R. SRINIVASAN, THE LD.COUN SEL FOR THE ASSESSEE, SUBMITTED THAT THE ASSESSEE IS NOT THE OW NER OF THE LAND AND HE IS ONLY A POWER OF ATTORNEY AGENT, THEREFORE , THERE CANNOT BE ANY ASSESSMENT IN THE HANDS OF THE ASSESSEE. ACCOR DING TO THE LD. COUNSEL, WHEN THE ASSESSEE IS NOT THE OWNER OF THE PROPERTY, THERE WAS NO QUESTION OF ANY TRANSFER. AS A POWER OF ATT ORNEY AGENT, THE ASSESSEE HAS NOT PAID ANY MONEY TO THE OWNER OF THE PROPERTY. THEREFORE, ACCORDING TO THE LD. COUNSEL, THE ADVANC E RECEIVED BY THE ASSESSEE AFTER EXECUTING SALE AGREEMENT IN HIS CAPACITY AS POWER OF ATTORNEY AGENT IS NOT LIABLE FOR TAXATION. SUBSEQUENTLY, ACCORDING TO THE LD. COUNSEL, THE OWNER OF THE LAND EXECUTED GENERAL POWER OF ATTORNEY IN THE NAME OF THE MOTHER OF DR. N.R.T.R. THIAGARAJAN ON 12.05.2011 AND ON THE SAME DAY, THE POWER OF ATTORNEY WAS EXECUTED IN THE NAME OF THE ASSESSEE W AS CANCELLED. THEREFORE, ACCORDING TO THE LD. COUNSEL, THE CIT(AP PEALS) HAS RIGHTLY DELETED THE ADDITION. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. ADMITTEDLY, THE AGREEMENT SAID TO BE ENTERED INTO BETWEEN THE ASSES SEE AND TWO OTHERS WITH DR. N.R.T.R. THIAGARAJAN WAS FOUND. AS PER THE 4 I.T.A. NO.2124/CHNY/16 MATERIAL FOUND DURING THE COURSE OF SURVEY, THE ASS ESSEE RECEIVED A SUM OF 1,14,00,000/-. THE SAID AMOUNT WAS NOT RETURNED BY THE ASSESSEE TO THE LAND OWNER OR TO ANYBODY ELSE. THE ASSESSEE APPEARS TO BE IN THE BUSINESS OF REAL ESTATE. THER EFORE, WHEN THE GAIN ARISES IN THE COURSE OF REAL ESTATE BUSINESS, IT IS NOT KNOWN WHY IT SHOULD NOT BE TREATED AS BUSINESS PROFIT. WHEN D R. N.R.T.R. THIAGARAJAN ENTERED INTO AN AGREEMENT WITH THE ASSE SSEE AND TWO OTHERS, THE CIRCUMSTANCES UNDER WHICH THE SAID AGRE EMENT WAS CANCELLED AND ANOTHER POWER OF ATTORNEY WAS EXECUTE D IN FAVOUR OF DR. N.R.T.R. THIAGARAJANS OWN MOTHER AFTER CANCELL ING THE POWER OF ATTORNEY IN FAVOUR OF THE ASSESSEE AND OTHERS WAS C ANCELLED, NEEDS TO BE EXAMINED AND BROUGHT ON RECORD. THEREFORE, O RDERS OF BOTH THE AUTHORITIES BELOW ARE SET ASIDE AND THE ENTIRE ISSUE RAISED BY THE ASSESSEE IS REMITTED BACK TO THE FILE OF THE ASSESS ING OFFICER. THE ASSESSING OFFICER SHALL RE-EXAMINE THE MATTER AND T HEREAFTER DECIDE THE ISSUE AFRESH IN ACCORDANCE WITH LAW, AFTER GIVI NG A REASONABLE OPPORTUNITY TO THE ASSESSEE. 5. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S ALLOWED FOR STATISTICAL PURPOSES. 5 I.T.A. NO.2124/CHNY/16 ORDER PRONOUNCED ON 17 TH JULY, 2018 AT CHENNAI. SD/- SD/- (. !'# ! ) ( . . . ) (A. MOHAN ALANKAMONY) (N.R.S. GANESAN) % / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 5 /DATED, THE 17 TH JULY, 2018. KRI. / -267 87)2 /COPY TO: 1. +, /APPELLANT 2. -.+, /RESPONDENT 3. 1 92 () /CIT(A)-1, MADURAI 4. PRINCIPAL CIT-1, MADURAI 5. 7: -2 /DR 6. ;( < /GF.