DCIT, CHENNAI V. Smt. Sohan Kanwar Nahar, CHENNAI

ITA 2141/CHNY/2010

• Counselvise Citation: [2012] 119 COUNSELVISE.COM (IT) 7456 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 2 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-03-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 01-03-2012
• Assessment Year: 2006-2007
• Appeal Filed On: 20-12-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANIRUDH RAI
• Assessee Lawyers: T BANUSEKAR
• Keywords: Competent authority
• Section: 142(1); 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, CHENNAI BEFORE SHRI ABRAHAM P.GEORGE, ACCOUNTANT MEMBER AND SHRI VIKAS AWASTHY, JUDICIAL MEMBER ITA NO.2141/MDS/2010 (ASSESSMENT YEAR : 2 006-07) THE DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-11(1), 46, M.G.ROAD, CHENNAI-34. VS. SMT. SOHAN KANWAR NAHAR, 6/1, NAHAR DRIVE, MAHARANI CHINNAMMA ROAD, ALWARPET, CHENNAI-600 018. PAN:AAEPN4718L (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI ANIRUDH RAI, CIT DR RESPONDENT BY : SHRI T.B ANUSEKAR DATE OF HEARING : 1 ST MARCH, 2012 DATE OF PRONOUNCEMENT : 1 ST MARCH, , 2012 O R D E R PER VIKAS AWASTHY, JUDICIAL MEMBER: THE PRESENT APPEAL HAS BEEN FILED BY THE REVENUE IMPUGNING THE ORDER DATED 20 TH SEPTEMBER, 2010 PASSED BY THE CIT(A)-II, CHENNAI, WHEREBY THE LEARNED CIT( A) HAS DELETED THE ADDITION OF ` 1,12,13,079/- MADE ON ACCOUNT OF LONG TERM CAPITAL GAINS. 2. THE FACTS IN BRIEF OF THE CASE ARE THAT A SEARCH UNDER SECTION 132 OF THE INCOME TAX ACT WAS CONDUCTED BY THE ITA NO.2141/MDS/2010 2 DEPARTMENT ON 26.10.2005 AT THE PREMISES OF THE AS SESSEE. SUBSEQUENTLY, NOTICE UNDER SECTION 142(1) WAS ISSUE D ON 23.07.2007. IN RESPONSE THEREOF, THE ASSESSEE FILED RETURN FOR THE ASSESSMENT YEAR 2006-07 DECLARING TAXABLE INCOM E OF ` 5,78,785/- AND AGRICULTURAL INCOME OF ` 60,520/-. THE ASSESSING OFFICER COMPLETED THE ASSESSMENT AND MADE CERTAIN ADDITIONS. APART FROM OTHER ADDITIONS, AN A DDITION TO THE TUNE OF ` 1,12,13,079/- WAS MADE BY THE ASSESSING OFFICER AS LONG TERM CAPITAL GAINS ON SALE OF LAND SITUATED AT KANNATHUR, REDDYKUPPAM VILLAGE. WHILE MAKING THE AB OVE SAID ADDITION, THE ASSESSING OFFICER OBSERVED THAT THE ASSESSE HAS NOT SUBMITTED DETAILS OF INPUTS USED FO R THE LANDS, PURCHASE OF SEEDS AND OTHER INPUTS, EXTENT O F IRRIGATION FACILITIES, SALE PROCEEDS AND YIELD, PARTICULARS OF PURCHASES, NATURE OF CROPS CULTIVATED, AGRICULTURAL INCOME-TAX , IF ANY PAID ON THE YIELD. AS NO EVIDENCE HAS BEEN PRODUCED REGA RDING RAW MATERIALS INPUTS, IRRIGATION FACILITIES, CROPS GROWN TO SHOW THAT THE LAND HAS BEEN PUT TO AGRICULTURAL USE, THE SAME CANNOT BE TREATED AS AGRICULTURAL LAND. ITA NO.2141/MDS/2010 3 3. AGGRIEVED BY THE ASSESSMENT ORDER DATED 31.12.20 07, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT(A), INTER- ALIA, DISPUTING THE ADDITION MADE ON ACCOUNT OF THE ALLEGED LONG TERM CAPITAL GAINS ON SALE OF LAND. AS PER THE CONTENTIONS OF THE ASSESSE, THE LAND IN QUESTION IS AN AGRICULT URAL LAND AND THUS NOT LIABLE FOR LONG TERM CAPITAL GAINS. THE LE ARNED CIT(A), ACCEPTING THE CONTENTION OF THE ASSESSE, HAS DELE TED THE ADDITION MADE BY THE ASSESSING OFFICER ON ACCOUNT O F SALE OF LAND AS LONG TERM CAPITAL GAINS. THUS, THE PRESENT APPEAL IS FILED BY THE REVENUE. 4. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED T HAT A SIMILAR ISSUE IN THE CASE OF HUSBAND OF THE ASSESSE E (SHRI SAYARCHAND NAHAR) WAS DECIDED BY THE TRIBUNAL IN I TA NO.2140/MDS/2010 FOR THE ASSESSMENT YEAR 2006-07 V IDE ORDER DATED 16 TH FEBRUARY, 2012 AND THE APPEAL OF THE REVENUE WAS DISMISSED. THEREFORE, THE ISSUE IN THI S CASE IS SQUARELY COVERED BY THE AFORESAID ORDER OF THE TRIB UNAL. THE LEARNED COUNSEL FOR THE ASSESSEE HAS ALSO FILED A C OPY OF LETTER DATED 3.4.1997 ISSUED BY THE COMPETENT AUTHO RITY AND ITA NO.2141/MDS/2010 4 ASSISTANT COMMISSIONER (URBAN LAND CEILING) ALANDUR , CHENNAI, WHICH IS PLACED ON RECORD AT PAGES 35 TO 3 8 OF THE PAPER BOOK ALONG WITH ITS TRUE TRANSLATION. THE REL EVANT EXTRACT OF THE LETTER IS REPRODUCED HEREIN BELOW:- A LAND SITUATED AT S.NO. 98/17 ADMEASURING TO 0.27.0 HECTARE IS OWNED BY MS. SOHAN KANWAR DEVI, W/O. SHRI SAYAR CHAND NAHAR, A RESIDENT OF NO. 17, GENERAL MUTHAIAH STREET, SOWCARPET, CHENNAI-600 079. A NOTICE U/S 17(2) WHICH WAS ORDERED ON 02.02.1996, HAS BEEN SERVED ON 27.12.1996 TO THE SAID LAND OWNER ASKING TO SUBMIT RETURN IN RESPECT OF THE SAID LAND, IN COMPLIANCE WITH PROVISIONS OF SEC. 7(1) OF TAMIL NADU URBAN LAND CEILING ACT, 1978. FURTHER, THE SAID LANDOWNER FILED HIS OBJECTIONS IN THIS OFFICE ON 31.12.1996. 2. DEPUTY TEHSILDAR OF THIS OFFICE MADE ENQUIRY IN DETAIL AND SUBMITTED HIS ELABORATE REPORT TO THIS OFFICE. IN HIS REPORT, IT IS STATED THAT THE SAID LAND COMPRISED IN S.NO. 98/17 OF KANNATHUR REDDYKUPPAM VILLAGE, ADMEASURING TO AN EXTENT OF 0.27.0 HECTARE, WAS PURCHASED BY THE PRESENT LANDOWNER NAMELY MS.SOHAN KANWAR NAHAR VIDE A SALE DEED BEARING DOCUMENT NO. 1583/89 DATED 23.06.89 AND THAT MUTATION IN HER NAME FOR THE SAID LAND IS COMPLETE AS EVIDENT FROM PATTA NO.447. ALSO, PERUSAL OF ADANGAL COPIES FOR THE FASLI YEARS 1392, 1394, 1395, 1397 & 1400, 1404, 1405 & 1406 REVEALED THE ENTRIES OF CULTIVATION OF CASUARINAS IN THIS PARTICULAR LAND. THE SAID DEPUTY TEHSILDAR RECOMMENDED THAT SINCE THIS LAND IS AN AGRICULTURAL LAND, FURTHER PROCEEDINGS COULD BE DROPPED. ITA NO.2141/MDS/2010 5 3. ON 31.1.1997, THE UNDERSIGNED INSPECTED THE SUBJECT LAND AND FOUND THAT THE SAME IS ENCOMPASSED BY COMPOUND WALLS ON NORTHERN, SOUTHERN AND WESTERN SIDES. ALSO, SAPLINGS OF CASUARINAS AGED ABOUT 01 YEAR ARE SEEN GROWING THERE. THERE IS NO BUILDING AND WELL ON THIS LAND. 4. THE PROVISIONS OF TAMILNADU URBAN LAND CEILING ACT, 1978 IS EXTENDED TO KANNATHUR REDDY KUPPAN VILLAGE WITH EFFECT FROM 09.08.1995. AS PER THE COPIES OF ADANGAL, OTHER RECORDS AND SITE INSPECTION, IT IS CLEAR THAT THE SUBJECT LANDS CATEGORY IS NOT CHANGED BY REMAINING AS AGRICULTURAL LAND CONTINUOUSLY. 5. ON THE OTHER HAND, THE LEARNED CIT DR HAS RELIE D ON THE ORDER PASSED BY THE ASSESSING OFFICER. HOWEVER, HE HAS CONCEDED THAT IDENTICAL ISSUE HAS BEEN DECIDED BY T HE TRIBUNAL IN THE CASE OF SHRI SAYARCHAND NAHAR, HUSB AND OF THE ASSESSE. 6. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE RECORDS. WE FIND THAT A SIMILAR LETTER WAS ISSUED I N THE CASE OF SHRI SAYARCHAND NAHAR, HUSBAND OF THE ASSESSE. IN THE APPEAL FILED BY SHRI SAYARCHAND NAHAR, THE TRIBUNA L, AFTER GOING THROUGH THE FACTS OF THE CASE AND THE DOCUME NTS ON RECORD, HELD AS UNDER:- ITA NO.2141/MDS/2010 6 THE ABOVE LETTER CLEARLY SHOWS THAT THE LAND HAD CULTIVATION OF CASUARINA PLANTS THEREIN AND AS PER THE TEHSILDAR, THE LAND WAS AGRICULTURAL IN NATURE. ASSISTANT COMMISSIONER (URBAN LAND CEILING) HAD DROPPED THE PROCEEDINGS FOR LEVY OF URBAN LAND TAX. IN HIS ORDER, IT IS ALSO MENTIONED THAT THE STATUS OF THE LAND REMAINS AGRICULTURAL AND IT CONTINUOUSLY REMAINED TO BE AGRICULTURAL. THIS IS A FACTUAL CERTIFICATE, AND JUST BECAUSE THE ASSESSEE COULD NOT PRODUCE EVIDENCE REGARDING PLANTS OR SAPLINGS OR FOR PURCHASE OF INSECTICIDES AND FERTILIZERS, SU CH A FACTUAL REPORT OF COMPETENT AUTHORITY CANNOT BE BRUSHED ASIDE. UNDISPUTEDLY, THE ASSESSEE HAD SHOWN AGRICULTURAL INCOME IN ITS INCOME-TAX RETURNS AND ALSO SHOWN THE AGRICULTURAL LAND IN ITS WEALTH- TAX RETURNS FOR EARLIER YEARS THOUGH CLAIMING IT AS EXEMPT. TEHSILDAR, CHENGALPATTU, HAD ALSO CERTIFIED IN HIS LETTER DATED 7.6.2010 THAT IRRIGAT ION WAS DONE THROUGH GROUND WATER FACILITIES. ADANGAL RECORD ALSO SHOWED THAT LAND WAS AGRICULTURAL. ASSESSEE MIGHT NOT HAVE PAID AGRICULTURAL INCOME- TAX BUT AGAIN THIS WILL NOT CONVERT AN AGRICULTURAL LAND INTO A NON-AGRICULTURAL LAND. ASSESSEE WAS, I N ANY CASE, PAYING LAND REVENUE AND VILLAGE RECORDS CLEARLY SHOWED THE LAND TO BE AGRICULTURAL. THERE IS NO CASE FOR THE REVENUE THAT AT THE TIME OF SALE, THE LAND HAD BEEN DIVIDED INTO PLOTS. THE ONLY INFERENCE THAT CAN BE DRAWN IN THE ABOVE CIRCUMSTANCES IS THAT THE LAND WAS AGRICULTURAL IN NATURE. INSOFAR AS ARGUMENT OF LEARNED D.R. THAT CASUARINA PLANTATIONS WERE ONLY SPONTANEOUS GROWTH AND THERE WAS NO EFFORT WHATSOEVER OF THE ASSESSEE, WE ARE OF THE OPINION THAT DEPUTY TEHSILDAR, AFTER PERUSING OF ADANGAL COPIES, HAD CERTIFIED THAT THERE WAS A CULTIVATION OF CASUARINA PLANTATIONS. CASUARINA PLANTS CULTIVATED IN A LAND CANNOT BE CONSIDERED AS GROWING SPONTANEOUSLY THEREIN. WE ARE, THEREFORE, OF THE OPINION THAT LD . CIT(APPEALS) WAS JUSTIFIED IN TAKING A VIEW THAT TH E ITA NO.2141/MDS/2010 7 LAND WAS AGRICULTURAL IN NATURE AND GAINS ARISING O N SALE WAS NOT EXIGIBLE TO CAPITAL GAINS TAX. NO INTERFERENCE IS CALLED FOR. IN VIEW OF THE FACT THAT THE ISSUE INVOLVED IN THE PRESENT APPEAL IS IDENTICAL TO THAT OF THE CASE OF SHRI SAY ARCHAND NAGAR (SUPRA), RESPECTFULLY FOLLOWING THE ORDER OF THE CO-ORDINATE BENCH OF THE TRIBUNAL, WE DISMISS THE A PPEAL OF THE REVENUE FOR THE REASONS MENTIONED HEREINABOVE. 7. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. ORDER PRONOUNCED IN THE OPEN COURT AT THE TIME OF H EARING ON 1 ST MARCH, 2012. SD/- SD/- (ABRAHAM P.GEORGE) (VIKAS AWASTHY) ACCOUNTANT MEMBER JUDICIAL MEMBER CHENNAI, DATED THE 1 ST MARCH, 2012. SOMU COPY TO: (1) APPELLANT ( 4) CIT(A) (2) RESPONDENT (5) D.R. (3) CIT (6) G.F.