Shri Divyesh Babulal Shah, Ahmedabad V. The Income tax Officer,Ward-13(4), Ahmedabad

ITA 2317/AHD/2012

• Counselvise Citation: 231720514 RSA 2012
• Duration Of Justice: 2 year(s) 6 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-05-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 25-02-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 16-10-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: S N DIVATIA
• Keywords: Capital asset; Opportunity of being heard; Principle of natural justice
• Section: 54F; 54

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, AHMEDABAD .. , , BEFORE SHRI BEFORE SHRI G.D. AGARWAL,VICE PRESIDEN T (AZ) AND SHRI KUL BHARAT, JUDICIAL MEMBER ./ I.T.A. NO.2317/AHD/2012 ( / ASSESSMENT YEAR : 2009-10) DIVYESH BABULAL SHAH 6/B, HARIHAR SOCIETY B/H. NAVGUJARAT COLLEGE ASHRAM ROAD, AHMEDABAD-380 014 / VS. THE ITO WARD-13(4) AHMEDABAD ! '# ./ ./ PAN/GIR NO. : ACCPS 5043 B ( !% / APPELLANT ) .. ( &'!% / RESPONDENT ) !%(' / APPELLANT BY : SHRI S.N. DIVATIA, A.R. &'!%)(' / RESPONDENT BY : SHRI DINESH SINGH, SR.DR * +) ,# / DATE OF HEARING 16/04/2015 -./0 ) ,# / DATE OF PRONOUNCEMENT 15/05/2015 '/ O R D E R PER SHRI KUL BHARAT, JUDICIAL MEMBER : THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST T HE ORDER OF THE LD.COMMISSIONER OF INCOME TAX(APPEALS)-XXI, AHMEDAB AD (CIT(A) IN SHORT) DATED 16/08/2012 PERTAINING TO ASSESSMEN T YEAR (AY) 2009-10. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF AP PEAL:- 1. THE ORDER PASSED U/S.250 ON 16-08-2012 FOR A.Y. 20 09-10 BY CIT(A)- XXI, ABAD, CONFIRMING DENIAL OF THE EXEMPTIONS CLAI MED U/S.54F AND 54(2) TOTALLING TO RS.54,08,831 IS WHOLLY ILLEGAL, UNLAWFUL AND AGAINST THE PRINCIPLES OF NATURAL JUSTICE. ITA NO.2317/AHD /2012 DIVYESH BABULAL SHAH VS. ITO ASST.YEAR 2009-10 - 2 - 2. THE LD.CIT(A) HAS GRIEVOUSLY ERRED IN LAW AND OR ON FACTS IN NOT CONSIDERING, FULLY AND PROPERLY THE EXPLANATIONS FU RNISHED AND THE EVIDENCE PRODUCED BY THE APPELLANT AS WELL AS PASSI NG A CRYPTIC, NON- REASONED ORDER. THE LD.CIT() HAS FAILED TO APPRECI ATE THAT THOUGH THE APPEAL WAS ADJOURNED TO 21-8-2012 IN RESPONSE TO TH E ADJOURNMENT APPLICATION FILED ON 19-7-2012 INSTEAD, THE IMPUGNE D ORDER WAS PASSED ON 16-8-2012 IN TOTAL DISREGARD TO THE SAID ADJOURN MENT GRANTED. THE LD.CIT(A) OUGHT TO HAVE ALLOWED THE APPELLANT FURTH ER OPPORTUNITY OF CIT(A) OUGHT TO HAVE ALLOWED THE APPELLANT FURTHER OPPORTUNITY OF PERSONAL HEARING BECAUSE HE HAD NOT OPTED FOR WRITT EN SUBMISSIONS. 3. THE LD.CIT(A) HAS GRIEVOUSLY ERRED IN LAW AND OR ON FACTS IN CONFIRMING THE DENIAL OF THE EXEMPTIONS U/S.54(2) OF RS.31,93, 831 AND U/S.54F OF RS.22.15 LACS. 4. THAT IN THE FACTS AND CIRCUMSTANCES OF THE CASE AS WELL AS IN LAW, THE LD.CIT(A) OUGHT NOT TO HAVE DENIED THE EXEMPTIONS U /S.54(2) OF RS.31,93,831 AND U/S.54F OF RS.22.15 LACS. THE LD. CIT(A) HAS GRIEVOUSLY ERRED IN UPHOLDING THAT THE APPELLANT HAD FAILED TO COMPLETE THE CONSTRUCTION OF A NEW RESIDENTIAL PROPERTY WITHIN T HE PRESCRIBED TIME AND TO UTILIZE THE AMOUNTS DEPOSITED IN CGA SCHEME SO T HAT THERE WAS FAILURE TO COMPLY WITH THE CONDITIONS SPECIFIED IN SECTION 54. 5. WITHOUT PREJUDICE TO ABOVE AND IN THE ALTERNATIVE, WHEN THE LD.CIT(A) HAS UPHELD THAT THE AMOUNT OF RS.22,15,000 SHOULD BE CH ARGED IN A.Y. 2012- 13, THE CAPITAL GAINS COULD NOT BE CHARGED IN A.Y. 2009-10. IT IS THEREFORE PRAYED THAT THE ADDITIONS TOTALING TO RS.54,08,831 ON ACCOUNT OF DENIAL OF EXEMPTIONS U/S.54 AND 54F MADE BY THE AO AND CONFIRMED BY CIT(A) SHOULD BE DELETED. 2. BRIEFLY STATED FACTS ARE THAT THE CASE OF THE A SSESSEE WAS PICKED UP FOR SCRUTINY ASSESSMENT AND THE ASSESSMENT U/S.143( 3) OF THE INCOME TAX ACT,1961 (HEREINAFTER REFERRED TO AS THE ACT) WAS FRAMED VIDE ORDER DATED 21/12/2011, THEREBY THE ASSESSING OFFICER (AO IN SHORT) MADE DISALLOWANCE IN RESPECT OF EXEMPTION CLAIMED OF RS. 31,93,981/- ON LONG- TERM CAPITAL GAIN AND DISALLOWANCE IN RESPECT OF EX EMPTION CLAIMED OF RS.22,15,000/- ON LONG-TERM CAPITAL GAIN. AGAINST THIS, THE ASSESSEE FILED ITA NO.2317/AHD /2012 DIVYESH BABULAL SHAH VS. ITO ASST.YEAR 2009-10 - 3 - AN APPEAL BEFORE THE LD.CIT(A), WHO AFTER CONSIDERI NG THE SUBMISSIONS, PARTLY ALLOWED THE APPEAL. 3. AT THE OUTSET, THE LD.COUNSEL FOR THE ASSESSEE S UBMITTED THAT BEFORE THE LD.CIT(A), THE ASSESSEE HAD FILED AN APPLICATIO N FOR SEEKING ADJOURNMENT OF HEARING. HOWEVER, THE LD.CIT(A) PRO CEEDED TO DISPOSE OF THE APPEAL. HE FURTHER SUBMITTED THAT THE ORDER OF THE LD.CIT(A) HAS NOT CONSIDERED THE WRITTEN SUBMISSIONS AND PASSED THE O RDER IN A CRYPTIC WAY. THE LD.COUNSEL FOR THE ASSESSEE DREW OUR ATTENTION TOWARDS PAGE NOS.39 AND 40 OF THE PAPER-BOOK, WHEREIN THE APPLICATION F OR SEEKING ADJOURNMENT IS ENCLOSED. 3.1. ON THE CONTRARY, LD.SR.DR SUPPORTED THE ORDER OF THE AUTHORITIES BELOW AND SUBMITTED THAT THE WRITTEN SUBMISSIONS SO FILED BY THE ASSESSEE WERE DULY CONSIDERED. 4. WE HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATERIAL AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. WE FIND THAT THE ASSESSEE HAD RAISED BEFORE THE LD. CIT(A) THE FOLLOWING GROUNDS OF APPEAL:- 1) THE LD.AO HAS GRIEVOUSLY ERRED IN LAW AND OR O N FACTS IN DENYING THE EXEMPTIONS U/S.54(2) OF RS.31,93,831 AND U/S.54 F OF RS.22.15 LACS. 2) THE LD.AO HAS GRIEVOUSLY ERRED IN LAW AND OR ON FACTS IN DENYING THE EXEMPTION U/S.54F OF RS.22.15 LACS. 3) WITHOUT PREJUDICE TO ABOVE AND IN THE ALTERNATI VE, THE LD.AO HAS FAILED TO APPRECIATE THAT EVEN PRESUMING FOR THE SA KE OF ARGUMENT THAT ITA NO.2317/AHD /2012 DIVYESH BABULAL SHAH VS. ITO ASST.YEAR 2009-10 - 4 - THE CONDITIONS SPECIFIED IN SECTION 54 AND 54F WERE NOT SATISFIED, THE AMOUNTS CLAIMED AS EXEMPT COULD NOT BE BROUGHT TO T AX IN AY 2009-10. THUS, THE AO HAD ERRED BOTH WITH REGARD TO NOT ONLY THE YEAR OF CHARGEABILITY BUT ALSO THE AMOUNTS WHICH COULD BE B ROUGHT TO TAX IN CASE OF FAILURE TO FULFILL THE CONDITIONS OF EXEMPT ION U/S.54 AND 54F. 5. GROUND NO.1 BEFORE THE LD.CIT(A) WAS THAT THE AO ERRED IN LAW AND OR ON FACTS DENYING THE EXEMPTIONS U/S.54(2) OF RS.31,93,831 AND U/S.54F OF RS.22.15 LACS. WE FIND THAT THE LD.CIT( A) HAD DECIDED THE ISSUE IN RESPECT OF FIRST ADDITION OF RS.31,93,831/ - IN PARA-4.3 OF HIS ORDER, BY OBSERVING AS UNDER:- 4.3. BEFORE ME SIMILAR SUBMISSIONS WERE MADE AS MA E BEFORE THE AO. I HAVE PERUSED THE ORDER OF AO, SUBMISSIONS MADE BY THE APPELLANT. IT IS AN ADMITTED FACT, EVEN BY THE APPELLANT, THAT TH E CONSTRUCTION OF NEW HOUSE PROPERTY WAS NOT COMPLETED WITHIN THE TIME 3 YEARS FROM THE DATE OF TRANSFER OF LONG TERM CAPITAL ASSETS. SECTION 5 4 IS VERY CLEAR THAT THE NEW HOUSE PROPERTY SHALL BE COMPLETED WITHIN 3 YEAR S FROM THE DATE OF TRANSFER OF LONG TERM CAPITAL ASSETS. THE ACTION O F THE AO DISALLOWING THE SUM RS.3193831 IS UPHELD. GROUND 1 IS DISMISSE D. 5.1. SIMILARLY, THE LD.CIT(A) HAD DECIDED THE ISSUE IN RESPECT OF SECOND ADDITION OF RS.22.15 LACS IN CONCLUDING PARA-5 OF H IS ORDER, BY OBSERVING AS UNDER:- 5. ON THE SECOND GROUND OF DISALLOWING THE SUM OF RS.2215000 I AGREE WITH THE CONTENTION OF THE AO THAT SUCH SUM W AS NOT UTILIZED WITHIN TIME ALLOWED U/S.54. THE ACTION OF AO DISAL LOWING THE SUM OF RS.2215000 IS UPHELD. 5.2. IN RESPECT OF GROUND NO.3, THE LD.CIT(A) HAD D ECIDED THE ISSUE IN PARA-6.2 OF HIS ORDER, BY OBSERVING AS UNDER:- ITA NO.2317/AHD /2012 DIVYESH BABULAL SHAH VS. ITO ASST.YEAR 2009-10 - 5 - 6.2. THE LANGUAGE OF THE PROVISO IS CLEAR THAT AN AMOUNT OF RS.2215000 SHALL BE CHARGED AS THE INCOME OF THE PR EVIOUS YEAR IN WHICH THE PERIOD OF THREE YEARS FROM THE DATE OF TH E TRANSFER OF THE ORIGINAL ASSET EXPIRES I.E. AY 2012-13. THE 3 RD GROUND IS ALLOWED. 6. FROM THE ABOVE, IT IS EVIDENT THAT THE LD.CIT(A) HAS NOT CONTROVERTED TO THE WRITTEN SUBMISSIONS OF THE ASSE SSEE MADE VIDE LETTER DATED 28/06/2012. UNDER THESE FACTS, WE ARE UNABLE TO CONFIRM THE ORDER OF THE LD.CIT(A), THEREFORE WITHOUT ENTERING INTO T HE MERIT OF THE CASE, WE HEREBY SET ASIDE THE ORDER OF THE LD.CIT(A) AND RES TORE ALL THE GROUNDS OF APPEAL TO THE FILE OF LD.CIT(A) FOR DECISION AFRESH . THE LD.CIT(A) IS HEREBY DIRECTED TO PASS A SPEAKING ORDER AFTER GIVI NG REASONABLE OPPORTUNITY OF BEING HEARD TO BOTH THE PARTIES. T HUS, GROUNDS RAISED BY THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE COURT ON FRIDAY, THE 15 TH DAY OF MAY, 2015 AT AHMEDABAD. SD/- SD/- ( .. ) ( ) ( G.D. AGARWAL ) ( KUL BHARAT ) VICE PRESIDENT (AZ) JUDICIAL MEMBER AHMEDABAD; DATED 15/ 05 /2015 4,..* , .*../ T.C. NAIR, SR. PS ITA NO.2317/AHD /2012 DIVYESH BABULAL SHAH VS. ITO ASST.YEAR 2009-10 - 6 - !'#$%&%# / COPY OF THE ORDER FORWARDED TO : 1. !% / THE APPELLANT 2. &'!% / THE RESPONDENT. 3. 567 8 / CONCERNED CIT 4. 8 ( ) / THE CIT(A)-XXI, AHMEDABAD 5. 9 :&*67 , ,670 , 5 / DR, ITAT, AHMEDABAD 6. : <= + / GUARD FILE. / BY ORDER, ' 9& //TRUE COPY// / ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD 1. DATE OF DICTATION .. 28.4.15 (DICTATION-PAD 8+ P AGES ATTACHED AT THE END OF THIS FILE) 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER ..11.5.15 3. OTHER MEMBER... 4. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S.. 5. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 6. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. P.S./P.S.15.5.15 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 15.5.15 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK ... 9. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 10. DATE OF DESPATCH OF THE ORDER