M/S MANOJ ASSOCIATES, BEAWAR V. CIT, Kota

ITA 225/JPR/2012

• Counselvise Citation: 22523114 RSA 2012
• Duration Of Justice: 1 year(s) 11 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-03-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2007-2008
• Appeal Filed On: 09-03-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUBHASH CHANDRA
• Assessee Lawyers: M C BHANDARI
• Keywords: Business income
• Section: 143(3); 260A; 263; 63

Judgement Text

IN THE INCOME TAX APPELALTE TRIBUNAL : JAIPUR BENCH : JAIPUR BEFORE SHRI HARI OM MARATHA, JUDICIAL MEMBER AND SHRI N.K. SAINI, ACCOUNTANT MEMBER. ITA NO. 225/JP/2012 (A.Y. 2007-08) M/S. MANOJ ASSOCIATES, VS. CIT, KOTA. UMED BHAWAN, KOTA (RAJASTHAN). PAN NO. AACFM 2093 B (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI M.C. BHANDARI. DEPARTMENT BY : SHRI SUBHASH CHANDRA - D.R. DATE OF HEARING : 23/01/2014. DATE OF PRONOUNCEMENT : 05/03/2014. O R D E R PER N.K. SAINI, A.M THIS IS AN APPEAL BY THE ASSESSEE AGAINST THE ORDE R DATED 10/11/2012 OF LD. CIT, KOTA. THE FOLLOWING GROUNDS HAVE BEEN RAISED IN THIS APPEAL: THE LEARNED COMMISSIONER OF INCOME TAX, KOTA ERRED IN LAW AS WELL AS ON FACTS IN PASSING THE ORDER U/SEC. 263 OF I.T. ACT, 1961 WITHOUT POINTING OUT ANY PARTICULAR ERROR IN THE ORDER OF ASSESSING OFFI CER MADE BY HIM DATED 27/11/2009. THE LEARNED COMMISSIONER OF INCOME TAX FAILED TO AP PRECIATE THAT A.O. HAS PASSED THE ASSESSMENT U/SEC. 143(3) OF I.T. ACT, 19 61 AFTER DETAIL ENQUIRY 2 AND EXAMINATION AND THEN ASSESSMENT ORDER WAS PASSE D AS PER LAW AND ALSO BASED ON TERRITORIAL HIGH COURT DECISION ON THE SIM ILAR FACTS AND CIRCUMSTANCES AND ON THE SAME ISSUE. THEREFORE, OR DER PASSED BY THE ASSESSING OFFICER HIM IS NOT ERRONEOUS NOR PREJUDIC IAL TO THE INTEREST OF REVENUE. IT IS THEREFORE, PRAYED THAT ORDER PASSED U/SEC. 2 63 BY CIT IS ILLEGAL, UNWARRANTED AND DESERVES TO BE CANCELLED/QUASHED. THE APPELLANT CRAVES YOUR HONOUR TO ALLOW, TO ADD ALTER OR AMEND OR ANY NEW GROUND OF APPEAL ON OR BEFORE THE DATE OF HEARI NG. 2 THE ONLY GRIEVANCE OF THE ASSESSEE IN THIS APPEAL RELATES TO THE ACTION OF THE LD. CIT, KOTA IN CONSIDERING THE ASSE SSMENT ORDER DATED 27/11/2009 PASSED UNDER SECTION 143(3) OF THE I.T. ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT IN SHORT) AS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE. 3. FACTS OF THE CASE, IN BRIEF, ARE THAT THE LD. CIT ISSUED A NOTICE UNDER SECTION 263 OF THE ACT TO THE ASSESSEE MENTIO NING AS UNDER:- ON PERUSAL OF RECORD IT IS OBSERVED THAT THE ASSE SSING OFFICER HAS TREATED YOUR INCOME AS INCOME FROM LONG TERM CAPITAL GAIN W HILE IT IS A BUSINESS INCOME AND THE MATTER IS YET NOT SETTLED IN YOUR OW N CASE AS AN APPEAL U/S 260A OF THE I.T. ACT IS PENDING WITH HON'BLE HIGH C OURT IN A.Y. 2003-04 ON SAME ISSUE. THE ASSESSEE SUBMITTED TO THE LD. CIT THAT THE OR DER OF THE ASSESSING OFFICER WAS VALID AS PER LAW BECAUSE THE ASSESSMENT WAS FRAMED AFTER EXAMINING THE CASE THOROUGHLY. IT WAS FURTHE R STATED THAT THE 3 ASSESSING OFFICER DETERMINED THE SURPLUS OF RS. 1,2 0,580/- AS LONG TERM CAPITAL GAIN AS PER VARIOUS DECISIONS INCLUDING THE DECISION OF HON'BLE RAJASTHAN HIGH COURT IN THE CASE OF CIT VS. SOHAN KHAN (2008) 7 DTR (RAJ.) 361 . SO, THERE WAS NO ERROR IN THE ORDER OF THE ASSES SING OFFICER. 4. THE LEARNED CIT, AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE, OBSERVED THAT IN ASSESSEES OWN CASE FOR A.Y. 2003- 04, THE INCOME FOR SALE OF LAND IN PLOT HAD BEEN ASSESSED AS BUSINESS INCOME INSTEAD OF LONG TERM CAPITAL GAIN DECLARED BY THE ASSESSEE. HE FURT HER OBSERVED THAT THE REVENUE HAD NOT ACCEPTED THE DECISION OF THE ITAT A ND FILED APPEAL UNDER SECTION 260A OF THE ACT BEFORE THE HON'BLE JURISDIC TIONAL HIGH COURT, WHICH IS REGISTERED AT DBITA NO. 482/2009 AND SINCE THE APPEAL IS PENDING, THE SAME ISSUE IS TO BE KEPT ALIVE. ACCOR DINGLY, THE ASSESSING OFFICER WAS DIRECTED TO MAKE FRESH ASSESSMENT. NOW THE ASSESSEE IS IN APPEAL. 5. LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT TH E VIEW TAKEN BY THE ASSESSING OFFICER WAS IN CONSONANCE WITH THE VI EW TAKEN BY THE ITAT IN ASSESSEES OWN CASE FOR THE A.Y. 2003-04, WHICH HAS NOT YET BEEN REVERSED. THEREFORE, THE LD. CIT WAS NOT JUSTIFIED IN CONSIDERING THE 4 ORDER PASSED BY THE ASSESSING OFFICER AS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE. RELIANCE WAS PLACED ON TH E FOLLOWING CASE LAWS:- 1. CIT VS. ALPS THEATER [65 ITR PAGE NO. 377 (SC)] 2. CIT VS. VIMAL CHAND GOLECHA [201 ITR 442 (RAJ.) (HC)] 3. CIT VS. SURESH CHAND GOYAL [298 ITR 277 (MP) (H C)] 4. CIT VS. SOHAN KHAN [(2008) 7 DTR (RAJ.) 361] 5. HINDUSTAN LIVER LTD. VS. CIT [(2011) 335 ITR 108 (CAL.) (HC)] 6. CIT VS. ANIL KUMAR SHARMA [(2011) 335 ITR 83 (DE L.) (HC)] 7. CIT VS. GANPATRAM BISHONI [(2008) 296 ITR 292 (R AJ.) (HC)] 8. RUSSELL PROPERTIES (PURCHASE) LTD. VS. ACIT [109 ITR PAGE NO. 229 (CAL.)(HC)] 9. CIT VS. ARVIND JEWELLERS [259 ITR 502 (GUJ.)(HC) ] 10. CIT VS. HINDUSTAN MARKETING & ADVERTISEMENT CO. LTD. [(2012) 341 ITR 180 (DEL.)(HC)] 11. ITO VS. DG HOUSING PROJECTS LTD. [(2012) 343 IT R 329 (DEL.)(HC)] 12. DIRECTOR OF IT VS. INSTITUTE OF CHARTERED ACCO UNTANTS OF INDIA [(2012) 347 ITR 86 (DEL.)(HC)] 13. CIT VS. INTERNATIONAL TRAVEL HOUSE LTD. [(2012) 344 ITR 554 (DEL.)(HC)] 14. MALABAR INDUSTRIAL CO. LTD. VS. CIT [243 ITR PA GE 83 (SC)] 15. CIT VS. VIKAS POLYMERS [(2012) 341 ITR 537 (DEL .)(HC)] 16. CIT VS. KELVINATOR OF INDIA LTD. [(2011) 332 IT R 231 (DEL.)(HC)] 17. GRASIM INDUSTRIES LTD. VS. CIT [(2010) 32 ITR 9 2 (BOM.)(HC)] 18. CIT VS. DELHI APARTMENTS (P) LTD. [(2013) 352 I TR 332 (DEL.)(HC)] 5 19. CIT VS. HINDUSTAN COCO COLA BEVERAGES (P) LTD. [(2011) 331 ITR 192 (DEL.) (HC)] 20. RANKA JEWELERS VS. ACIT AND ANOTHER [(201) 328 ITR 148 (BOM.) (HC)] 21. CIT VS. D.L.F. POWER LTD. [(2010) 329 ITR 289 ( DEL.)(HC)] 22. CIT VS. MAX INDIA LTD. [(2007) 295 ITR 282 (SC) ] 23. CIT VS. DLF LTD. [(2013) 350 ITR 555(DEL.)(HC)] 24. SPECTRA SHARES & SCRIPPS (P) LTD. VS. CIT [(201 3) 354 ITR 35 (AP)(HC)] 25. CIT AND ANOTHER VS.D.G. GOPALA GAWDA [(2013) 35 4 ITR 501 (KAR.)(HC)] 26. CIT VS. HINDUSTAN MARKETING & ADV. CO. LTD. [(2 012) 341 ITR 180 (DEL.)(HC)] 27. ARHAND BUILDERS DEVELOPERS AND INVESTORS (P) LT D. VS. ITAT & ANOTHER [(2005) 277 ITR 239 (MP)(HC)] 28. CIT VS. GIRDHARI LAL [(2012) 258 ITR 331 (RAJ.) (HC)] 29. CIT VS. SOHAN WOOLEN MILLS [(2008) 296 ITR 238 (HP)] 30. CIT VS. HONDA SIEL POWER PRODUCTS LTD. [(2011) 333 ITR 547 (DEL.)(HC)] 31. MODERN MINERALS VS. ACIT [(1997) 59 TTJ (JP) 73 3] 32. STERLING FOODS VS. CIT [190 ITR 275 (KAR.)(HC)] 33. STATE OF ANDHRA PRADESH VS. CTO & ANOTHER [169 ITR 564 (AP)(HC)] 34. SIEMENS INDIA LTD. VS. K. SUBRAMANIAN, ITO AND ANOTHER [143 ITR 120 & 141 (BOM.)(HC)] 6 . IN HIS RIVAL SUBMISSIONS, LEARNED D.R. SUPPORTED THE ORDER OF THE LD. CIT. 6 7 . WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE PA RTIES AND CAREFULLY GONE THROUGH THE MATERIAL AVAILABLE ON RE CORD. IN THE PRESENT CASE, IT IS AN ADMITTED FACT THAT THE ASSESSING OFF ICER ASSESSED THE SURPLUS OF RS. 1,20,580/- AS LONG TERM CAPITAL GAIN IN CONS ONANCE WITH THE VIEW TAKEN BY THE ITAT IN ASSESSEES OWN CASE HAVING IDE NTICAL FACTS. THE LD. CIT ALSO ACCEPTED THIS FACT THAT THE VIEW TAKEN BY THE ASSESSING OFFICER WAS IN ACCORDANCE WITH THE DECISION TAKEN BY THE IT AT IN ASSESSEES OWN CASE FOR THE A.Y. 2003-04. ALTHOUGH, THE LD. CIT S IMPLY STATED THAT THE SAID DECISION OF THE ITAT WAS NOT ACCEPTED BY THE D EPARTMENT, BUT NOTHING WAS BROUGHT ON RECORD TO SUBSTANTIATE THAT THE DECISION OF THE ITAT FOLLOWED BY THE ASSESSING OFFICER HAS BEEN REV ERSED BY THE HIGHER FORUM. WE, THEREFORE, ARE OF THE CONSIDERED VIEW T HAT THE LD. CIT WAS NOT JUSTIFIED IN HOLDING THAT THE ASSESSMENT FRAMED BY THE ASSESSING OFFICER WAS ERRONEOUS AND PREJUDICIAL TO THE INTERE ST OF THE REVENUE SIMPLY ON THIS BASIS THAT A SIMILAR ISSUE WAS PENDI NG BEFORE THE HON'BLE JURISDICTIONAL HIGH COURT. 8. ON A SIMILAR ISSUE, THE HON'BLE CALCUTTA HIGH COURT IN THE CASE OF RUSSELL PROPERTIES PVT. LTD. VS. ACIT AND OTHERS RE PORTED IN (1977) 109 ITR 229 HAS HELD AS UNDER:- 7 THE INCOME-TAX OFFICER HAD MERELY FOLLOWED THE DE CISION OF THE APPELLATE TRIBUNAL. IT HAD NOT BEEN POINTED OUT TH AT THERE WERE ANY MATERIALS FOR THE INCOME-TAX OFFICER NOT TO FOLLOW THE DECISION OF THE TRIBUNAL. THE PROPOSED EXERCISED OF THE POWER OF R EVISION UNDER SECTION 263 WAS ILLEGAL AND WITHOUT JURISDICTION. 9 . IN THE PRESENT CASE ALSO, THE ASSESSING OFFICER M ERELY FOLLOWED THE DECISION OF THE ITAT AND NOTHING WAS POINTED OUT TH AT THERE WERE ANY MATERIAL FOR THE ASSESSING OFFICER NOT TO FOLLOW TH E DECISION OF THE ITAT. THEREFORE, THE SAID ORDER PASSED BY THE ASSESSING O FFICER CANNOT BE SAID TO BE ERRONEOUS AND THE PROPOSED EXERCISE OF POWER FOR REVISION UNDER SECTION 263 OF THE ACT WAS ILLEGAL. AT THE MOST IT CAN BE SAID THAT THE SAID VIEW WAS A DEBATABLE, BUT IT CANNOT BE SAID TH AT THE ASSESSING OFFICER HAD NOT TAKEN A POSSIBLE VIEW. THEREFORE, THE IMPUGNED ORDER IS SET ASIDE AND THE ASSESSMENT ORDER PASSED BY THE AS SESSING OFFICER IS RESTORED. 10 . IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. (ORDER PRONOUNCED IN THE COURT ON 25 TH MARCH, 2014). SD/- SD/- (HARI OM MARATHA) (N.K.SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 25 TH MARCH, 2014. VR/- COPY TO: 8 1. THE APPELLANT 2. THE RESPONDENT 3. THE LD.CIT 4. THE CIT(A) 5. THE D.R ASSISTANT REGISTRAR, ITAT, JAIPUR.