Smt. Vijayamma Syamprakash Vaidyan, Surat V. The Dy. Commissioner of Income Tax, Circle-1(3), Surat

ITA 2192/AHD/2016

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 2345 (ITAT-SURAT)
• Duration Of Justice: 4 year(s) 2 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-11-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2012-2013
• Appeal Filed On: 24-08-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANUPAMA SINGLA
• Assessee Lawyers: MEHUL K PATEL
• Keywords: Share purchase agreement; Revised return; Set aside; Capital Gains
• Section: 139(1); 13; 139

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL SURAT BENCH, SURAT BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER AND DR. ARJUN LAL SAINI, ACCOUNTANT MEMBER (VIRTUAL HEARING) . . ./ I.T.A NO.2192/AHD/2016 [ [ / ASSESSMENT YEAR: 2012-13 SMT.VIJAYAMMA SYAMPRAKASH VAIDYAN, 832, Q-TOWER, ASHIRWAD PALACE, NEAR JAMNA NAGAR BUS STAND, JIVKORNAGAR, BHATAR, SURAT 395007. [PAN: AKMPS 7570 B] VS. DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-1(3), SURAT. / APPELLANT /RESPONDENT [ /ASSESSEE BY SHRI MEHUL K.PATEL AR /REVENUE BY SMT . ANUPAMASINGLA SR.DR / DATE OF HEARING: 23 . 1 1 .20 20 /PRONOUNCEMENT ON: 23 . 1 1 .20 20 /O R D E R PER PAWAN SINGH, JUDICIAL MEMBER: 1. THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF LD. COMMISSIONER OF INCOME TAX (APPEALS)-II,[CIT(A)] SURAT DATED 10.05.2016 FOR THE A.Y. 2012-13. THE ASSESSEE RAISED THE FOLLOWING GROUNDS OF APPEAL AS UNDER: (1). THAT THE LEARNED CIT(A) HAS GRIEVOUSLY ERRED IN LAW AND ON FACTS, IN HOLDING THAT THE ASSESSMENT IS TO BE MADE AS PER THE ORIGINAL RETURN, WHEREAS THE APPELLANT HAS DULY FILED THE REVISED RETURN OF INCOME, WHEREIN THE CLAIM OF REDUCTION OF LONG TERM CAPITAL GAINS OF RS.1,25,23,073/- IS MADE, WHICH IS NOT CONSIDERED BY AO AT ALL. SMT.VIJAYAMMA S.VAIDYAN VS. DCIT, CIRCLE-1(3), SURAT/ ITA NO.2192/AHD/2016 FOR A.Y. 2012-13 2 (2) THAT, IN LAW, AND ON FACTS AND EVIDENCE ON RECORD, THE CLAIM MADE IN THE REVISED RETURN OUGHT TO HAVE BEEN CONSIDERED AND THE CORRECT TAXABLE INCOME OF THE APPELLANT OUGHT TO HAVE BEEN DETERMINED AS PER LAW. (3) THAT IN THE ALTERNATE, AND WITHOUT PREJUDICE TO THE ABOVE GROUNDS, IT IS PRAYED THAT THIS HON'BLE TRIBUNAL MAY PLEASE DIRECT THE AO TO CONSIDER THE CLAIM MADE IN THE REVISED RETURN OF INCOME, AND DETERMINE THE CORRECT TAXABLE INCOME AS PER LAW. (4) THE APPELLANT CRAVES LEAVE TO ADD, ALTER, AMEND ANY GROUND OF APPEAL. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS AN INDIVIDUAL. THE ASSESSEE FILED HER RETURN OF INCOME FOR ASSESSMENT YEAR 2012-13 ON 02.10.2012 DECLARING TOTAL INCOME OF RS. 11.62 CRORE. IN THE COMPUTATION OF TOTAL INCOME THE ASSESSEE CLAIMED LONG TERM CAPITAL GAIN OF RS. 12.39 CRORE. THE ASSESSEE ALSO FURNISHED WORKING OF CAPITAL GAIN. SUBSEQUENTLY, THE ASSESSEE FILED REVISED RETURN OF INCOME ON 26.03.2013 DECLARING TOTAL INCOME OF RS. 10.37 CRORE. THE ASSESSEE ALSO FURNISHED REVISED COMPUTATION OF INCOME. IN THE REVISED COMPUTATION OF INCOME THE ASSESSEE CLAIMED LONG TERM CAPITAL GAIN OF RS.11.14 CRORE AND ALSO FURNISHED REVISED WORKING OF THE CAPITAL GAIN, THEREBY CLAIMING REDUCTION IN CAPITAL GAIN. IN THE NOTE APPENDED BELOW THE REVISED COMPUTATION OF TOTAL INCOME, THE ASSESSEE CLAIMED THAT AS PER SHARE PURCHASE AGREEMENT (SPA) THE ASSESSEE PAID CERTAIN AMOUNT TO M/S. NEO STRUCTU CONSTRUCTION PVT. LTD. AND M/S.SPETECH PLANT EQUIPMENT PVT. LTD., AND ACCORDINGLY THE NET CONSIDERATION OF SALE OF SHARES WERE REDUCED. THE CASE WAS SELECTED FOR SCRUTINY. THE ASSESSING OFFICER (AO) WHILE PASSING THE ASSESSMENT ORDER ACCEPTED THE RETURNED INCOME FILED ORIGINALLY. IN THE ORIGINAL RETURN OF INCOME, SMT.VIJAYAMMA S.VAIDYAN VS. DCIT, CIRCLE-1(3), SURAT/ ITA NO.2192/AHD/2016 FOR A.Y. 2012-13 3 THE ASSESSEE CLAIMED LONG TERM CAPITAL GAIN OF RS.12.39 CRORES. HOWEVER, THE REDUCTION IN CAPITAL GAIN CLAIMED IN REVISED RETURN WAS NOT CONSIDERED BY PASSING THE ASSESSMENT ORDER. 3. AGGRIEVED BY THE ACTION OF AO, THE ASSESSEE FILED APPEAL BEFORE THE LD.CIT(A). BEFORE LD CIT(A), THE ASSESSEE FILED WRITTEN SUBMISSIONS DATED 04.05.2016, WHICH IS EXTRACTED BY LD CIT(A) IN PARA 5 OF THE IMPUGNED ORDER. IN THE WRITTEN SUBMISSIONS THE ASSESSEE STATED THAT IN THE REVISED RETURN OF INCOME THE ASSESSEE CLAIMED REDUCTION IN CAPITAL GAIN OF RS. 1.25 CRORE. THE AO COMPLETED THE ASSESSMENT ON THE BASIS OF ORIGINAL RETURN OF INCOME AND THAT NO REASON WAS GIVEN BY HIM FOR NOT CONSIDERING THE REVISED RETURN OF INCOME. THE ASSESSEE ALSO RELIED ON THE DECISION OF MUMBAI TRIBUNAL IN ITA NO. 3706/MUM/2011 DATED 13 TH OCTOBER 2012, WHEREIN IT WAS HELD THAT WHERE THE TIME LIMIT FOR FILING THE REVISED RETURN HAS PASSED AND THE ASSESSEE FILED REVISED COMPUTATION AND PRAYED TO TREAT THE SAME AS REVISED RETURN. THE REVISED COMPUTATION WAS NOT ACCEPTED BY AO, HOWEVER, ON SECOND APPEAL THE TRIBUNAL ACCEPTED THE REVISED COMPUTATION AND RESTORED THE MATTER BACK TO THE FILE OF AO TO CONSIDER THE CLAIM OF ASSESSEE AFRESH. THE TRIBUNAL WHILE RESTORING THE CLAIM OF THAT ASSESSEE FOLLOWED THE JUDGMENT OF HONBLE SUPREME COURT IN GURJAGRAUVREOUS P LTD (111 ITR 1 SC), WHEREIN IT WAS LAID DOWN THAT THE ASSESSEE IS NOT ONLY ENTITLED TO RAISE ADDITIONAL GROUNDS OF APPEAL BUT ALSO ENTITLED TO RAISE ADDITIONAL CLAIM. THE ASSESSEE ALSO FURNISHED REVISED RETURN OF TOTAL INCOME TO CLAIM THE REDUCTION IN HER SALE PRICE OF SHARES OF NEO STRUCTO CONSTRUCTION LTD. SMT.VIJAYAMMA S.VAIDYAN VS. DCIT, CIRCLE-1(3), SURAT/ ITA NO.2192/AHD/2016 FOR A.Y. 2012-13 4 4. THE SUBMISSION MADE BY ASSESSEE WAS NOT ACCEPTED BY LD.CIT(A). THE LD. CIT(A) AFFIRMED THE ACTION OF AO. THE LD CIT(A) WHILE AFFIRMING THE ACTION OF AO HELD THAT THE ASSESSEE FILED RETURN OF INCOME ON 02.10.2012 WHICH WAS BEYOND THE DUE DATE ON FILING RETURN UNDER SECTION 139 OF THE ACT. DUE DATE FOR FILING RETURN U/S.139 OF THE ACT WAS 31.07.2012, WHICH WAS EXTENDED BY CENTRAL BOARD OF DIRECT TAXES (CBDT) UP TO 31.08.2012, HOWEVER, THE ASSESSEE FILED RETURN OF INCOME ON 02.10.2012. AS ORIGINAL RETURN OF INCOME WAS FILED BEYOND THE DUE DATE, ACCORDINGLY THE ASSESSEE WAS NOT ENTITLED TO FILE REVISED RETURN. THE REVISED RETURN FILED ON 16.03.2013 IS INVALID RETURN. FURTHER AGGRIEVED, THE ASSESSEE HAS FILED PRESENT APPEAL BEFORE THIS TRIBUNAL. 5. WE HAVE HEARD THE SUBMISSION OF LD.AUTHORISED REPRESENTATIVE(AR) OF THE ASSESSEE AND LD.DEPARTMENTAL REPRESENTATIVE(DR) FOR THE REVENUE. WE HAVE ALSO GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. THE LD.AR OF THE ASSESSEE SUBMITS THE AO WHILE PASSING THE ASSESSMENT ORDER NOT CONSIDERED THE REVISED RETURN NOR GIVEN ANY REASON. THE ASSESSEE FILED REVISED RETURN ON 16.03.2013 AND CLAIMED REDUCTION OF CERTAIN AMOUNT PAID TO M/S. NEO STRUCTO CONSTRUCTION PVT. LTD., AND M/S SPETECH PLANT EQUIPMENT PVT. LTD., AND CLAIMED THE REDUCTION OF AMOUNT FROM THE LONG TERM CAPITAL GAIN. THE AO ACCEPTED THE ORIGINAL RETURN OF INCOME. THE ASSESSEE BEFORE FIRST APPELLATE AUTHORITY HAS RAISED SPECIFIC GROUND OF APPEAL THAT IN REVISED RETURN OF INCOME THE ASSESSEE CLAIMED CERTAIN REDUCTION ON ACCOUNT OF AMOUNT PAID TO M/S.NEO STRUCTO CONSTRUCTION PVT. LTD. AND M/S SPETECH PLANT EQUIPMENT PVT. LTD. THE LD. CIT(A) INSTEAD OF ALLOWING THE CONTENTION SMT.VIJAYAMMA S.VAIDYAN VS. DCIT, CIRCLE-1(3), SURAT/ ITA NO.2192/AHD/2016 FOR A.Y. 2012-13 5 OF THE ASSESSEE CONCLUDED THAT THE ORIGINAL RETURN FILED BY ASSESSEE WAS BEYOND THE TIME LIMIT ALLOWED BY CBDT. THE CBDT ALLOWED/EXTENDED FOR FILING OF RETURN OF INCOME FOR RELEVANT ASSESSMENT YEAR UP TO 31.08.2012. THE ASSESSEE FILED ORIGINAL RETURN ON 02.10.2012 WHICH WAS BEYOND THE EXTENDED PERIOD, THEREFORE, THE ORIGINAL RETURN WAS INVALID. THE LD.AR OF THE ASSESSEE SUBMITS THAT EVEN OTHERWISE, IF IT IS PRESUMED THAT ASSESSEE HAS NOT CLAIMED REDUCTION BY WAY OF FILING REVISED RETURN, THE ASSESSEE IS ENTITLED TO RAISE ADDITIONAL CLAIM BEFORE THE FIRST APPELLATE AUTHORITY. THE ASSESSEE ALSO RAISED HIS CLAIM BEFORE THE LD.CIT(A) AND AS PER THE DECISION OF HON'BLE JURISDICTIONAL HIGH COURT IN CIT VS. MITESH IMPEX [46 TAXMANN.COM 30] (GUJ). THE ASSESSEE HAS A RIGHT TO RAISE FRESH CLAIM. THE LD.CIT(A) INSTEAD OF CONSIDERING THE CLAIM OF ASSESSEE, DECLINE TO ENTERTAIN THE GROUNDS OF APPEAL. ON THE GROUND THAT THE ORIGINAL RETURN OF INCOME WAS FILED BEYOND THE DUE DATE. THE LD.AR OF THE ASSESSEE FURTHER SUBMITS THAT THE ASSESSEE IS LEGALLY ENTITLED TO RAISE NEW CLAIM BEFORE THE APPELLATE AUTHORITY EVEN WITHOUT REVISING RETURN BEFORE THE AO. THE LD.AR SUBMITS THAT HON'BLE SUPREME COURT IN GOTEZ (I) LTD. VS CIT [284 ITR 323] HELD THAT THE POWER TO ENTERTAIN THE FRESH/ ADDITION CLAIM BY APPELLATE AUTHORITY IS NOT RESTRICT, THOUGH AO IS NOT ENTITLED TO CONSIDER THE FRESH CLAIM IN ABSENCE OF REVISED RETURN. IN STRENGTHEN HIS SUBMISSION, THE LD. AR OF THE ASSESSEE ALSO RELIED UPON THE DECISION OF HON'BLE JURISDICTIONAL HIGH COURT IN S. R. KOSHI VS CIT 276 ITR 165 AND DECISION OF AHMEDABAD TRIBUNAL IN ADANI POWER LTD., IN ITA NO.1663 AND 1686/AHD/2014 DATED 28.06.2018. SMT.VIJAYAMMA S.VAIDYAN VS. DCIT, CIRCLE-1(3), SURAT/ ITA NO.2192/AHD/2016 FOR A.Y. 2012-13 6 THE LD.AR OF THE ASSESSEE PRAYED THAT THE GROUNDS OF APPEAL RAISED BY ASSESSEE MAY BE RESTORED TO THE FILE OF THE AO TO CONSIDER THE ADDITIONAL CLAIM RAISED BY ASSESSEE ABOUT THE REDUCTION OF AMOUNT PAID TO M/S. NEO STRUCTO CONSTRUCTION PVT. LTD. AND M/S SPETECH PLANT EQUIPMENT PVT. LTD., TO DECIDE THE ISSUE AFRESH. 6. ON THE OTHER HAND, THE LD. DEPARTMENTAL REPRESENTATIVE (DR) FOR THE REVENUE SUPPORTED THE ORDER OF LD CIT(A). THE LD DR FOR THE ASSESSEE SUBMITS THAT THE LD CIT(A) HAS CATEGORICALLY HELD THAT ORIGINAL RETURN OF INCOME WAS BEYOND THE DUE DATE AS PRESCRIBED UNDER SECTION 139(1) OF THE ACT AND WAS INVALID RETURN AND THUS, THE ASSESSEE WAS NOT ENTITLED TO FILE REVISE RETURN OF INCOME. 7. WE HAVE CONSIDERED THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND CAREFULLY GONE THROUGH THE ORDERS OF LOWER AUTHORITIES. WE HAVE ALSO DELIBERATED ON VARIOUS CASE LAWS RELIED BY THE LD. AR OF THE ASSESSEE. THERE IS NO DISPUTE THAT ORIGINAL RETURN OF INCOME WAS FILED BY THE ASSESSEE ON 02.12.2012. THE CASE WAS SELECTED FOR SCRUTINY AND PROCESSED AND WAS ACCEPTED BY THE AO, WITHOUT VARIATION OF INCOME. BEFORE, LD CIT(A), THE ASSESSEE RAISED HIS GRIEVANCES THAT HIS REVISED RETURN AND REVISED COMPUTATION OF INCOME WAS NOT CONSIDERED NOR ANY REASON WAS COMMUNICATED. THE LD CIT(A) REJECTED THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE BY TAKING VIEW THAT ASSESSEE FILED ORIGINAL RETURN OF INCOME ON 02.10.2012 WHICH WAS BEYOND THE DUE DATE ON FILING RETURN UNDER SECTION 139 OF THE ACT. DUE DATE FOR FILING RETURN UNDER SECTION 139 OF THE ACT WAS 31.07.2012, WHICH WAS EXTENDED BY CBDT UP TO 31.08.2012, HOWEVER, THE ASSESSEE FILED SMT.VIJAYAMMA S.VAIDYAN VS. DCIT, CIRCLE-1(3), SURAT/ ITA NO.2192/AHD/2016 FOR A.Y. 2012-13 7 RETURN OF INCOME ON 02.10.2012. AS ORIGINAL RETURN OF INCOME WAS FILED BEYOND THE DUE DATE, ACCORDINGLY THE ASSESSEE WAS NOT ENTITLED TO FILE REVISED RETURN. THE REVISED RETURN IS ALSO INVALID RETURN. WE HAVE NOTED THAT THE LD CIT(A) BEFORE TREATING THE ORIGINAL RETURN AS INVALID RETURN HAS NOT ISSUED SHOW CAUSE NOTICE. IN OUR VIEW, ONCE THE AO ACCEPTED THE RETURN OF INCOME AND ACCEPTED IT WITHOUT ANY VARIATION, THE LD CIT(A), BEFORE TREATING IT AS INVALID RETURN SHOULD HAVE AFFORDED THE OPPORTUNITY OF HEARING TO THE ASSESSEE. WE HAVE FURTHER NOTED THAT IN ADDITION TO THE REVISED RETURN OF INCOME, THE ASSESSEE ALSO RAISED SIMILAR CLAIM BY WAY OF ADDITIONAL CLAIM BEFORE LD CIT(A). THE LD CIT(A) TREATED BOTH THE RETURN OF INCOME AS INVALID RETURN. 8. IN OUR CONSIDERED VIEW THE ORDER OF LD. CIT(A) IN TREATING THE RETURN OF INCOME AS INVALID RETURN IS NOT JUSTIFIED WITHOUT ISSUING SHOW CASUE NOTICE TO THE ASSESSEE, PARTICULARLY WHEN THE ORIGINAL RETURN OF INCOME WAS ACCEPTED BY AO. HENCE, WE SET ASIDE THE ORDER OF LD CIT(A) AND ADMIT THE ADDITIONAL CLAIM RAISED IN REVISED RETURN OF INCOME FOR REDUCTION OF CLAIM OF LONG TERM CAPITAL GAIN AND RESTORE THE ISSUE TO THE FILE OF AO TO CONSIDER IT AFRESH AND PASS THE ORDER IN ACCORDANCE WITH LAW. IN THE RESULT THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSE. 9. IN THE RESULT THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT ON 23-11-2020. SD/- SD/- (DR.ARJUN LAL SAINI) (PAWAN SINGH) ( /ACCOUNTANT MEMBER) ( /JUDICIAL MEMBER) SMT.VIJAYAMMA S.VAIDYAN VS. DCIT, CIRCLE-1(3), SURAT/ ITA NO.2192/AHD/2016 FOR A.Y. 2012-13 8 / SURAT, DATED : 23 RD NOV , 2020 S.GANGADHARA RAO, SR.PS COPY OF ORDER SENT TO- ASSESSEE/AO/PR. CIT/ CIT (A)/ ITAT (DR)/GUARD FILE OF ITAT. BY ORDER / / TRUE COPY / / ASSISTANT REGISTRAR, SURAT