Appu Iyer Thaneer Pandal Dharmam Private Trust, CHENNAI V. ITO, CHENNAI

ITA 2340/CHNY/2015

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 8904 (ITAT-CHENNAI)
• Duration Of Justice: 6 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-07-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 18-04-2016
• Assessment Year: 2011-2012
• Appeal Filed On: 29-12-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A V SREEKANTH
• Assessee Lawyers: G SEETHARAMAN
• Keywords: Capital asset
• Section: 143(3); 2(14)

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL , C B ENCH, CHENNAI . , . , # $ BEFORE SHRI A.MOHAN ALANKAMONY, ACCOUNTANT MEMBER AND SHRI G.PAVAN KUMAR, JUDICIAL MEMBER ./ I.T.A.NO.2340/MDS/2015 ( / ASSESSMENT YEAR: 2011-12) APPU IYER THANEER PANDAL DHARMAM PRIVATE TRUST, 12, SUNDARARAJAN STREET, ABHIRAMAPURAM, CHENNAI-600 018. VS THE INCOME TAX OFFICER, BUSINESS WARD-XV(1) CHENNAI-34. PAN:BMTPS0139Q PAN: AADFK4054B ( /APPELLANT) ( /RESPONDENT) / APPELLANT BY : MR. G.SEETHARAMAN, C.A. /RESPONDENT BY : MR. A.V.SREEKANTH, JCIT /DATE OF HEARING : 18 TH APRIL, 2016 /DATE OF PRONOUNCEMENT : 1 ST JULY, 2016 / O R D E R PER A. MOHAN ALANKAMONY, AM:- THIS APPEAL IS FILED BY THE ASSESSEE AGGRIEVED BY THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (AP PEALS)- 4, CHENNAI DATED 28.10.2015 IN ITA NO.50/2014-15/2 011- 12/CIT(A)-4 PASSED UNDER SECTION 143(3) & 250(6) O F THE ACT. 2. THE ASSESSEE HAS RAISED SEVERAL GROUNDS IN ITS A PPEAL, HOWEVER, THE CRUX OF THE ISSUE IS AS FOLLOWS:- THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN CONFIRMING THE ORDER OF THE LEARNED 2 ITA NO.2340/MDS/2015 ASSESSING OFFICER ON ACCOUNT OF LEVY OF CAPITAL GAI NS TAX ON SALE OF AGRICULTURAL LANDS BY THE ASSESSEE TRUST . 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE TR UST FILED ITS RETURN OF INCOME ON 03.10.2011 FOR THE ASSESSME NT YEAR 2011-12 ADMITTING INCOME OF ` 2,38,800/-. ON SCRUTINY, THE LEARNED ASSESSING OFFICER OBSERVED THAT THE ASSESSE E HAD SOLD LAND IN SURVEY NO. 72/1, 72/2, 93/1D, 93/2, 93 /3 & 93/4 AT ULLUR VILLAGE, CHETTIMANDAPAM, KUMBAKONAM TALUK FOR ` 75,00,000/- WHICH WAS CATEGORIZED AS RESIDENTIAL LA ND BY THE TAMIL NADU REGISTRATION DEPARTMENT. THEREFORE, REL YING IN CERTAIN DECISIONS OF THE CHENNAI BENCH OF THE TRIBU NAL, THE LEARNED ASSESSING OFFICER OPINED THAT THE ASSESSEE WILL BE LIABLE FOR CAPITAL GAIN TAX BECAUSE THE LAND SOLD B Y THE ASSESSEE IS NOT AGRICULTURAL LAND. HE FURTHER ADOP TED ONE RUPEE PER SQ.FT AS THE MARKET VALUE OF THE LAND AS ON 01.04.1981 BECAUSE THE GUIDELINE VALUE FOR THE YEAR 1987 IN THAT LOCALITY WAS RS.4/- PER SQ.FT., AND NO SALE IN STANCES WAS AVAILABLE IN THE REVENUE RECORD OF THE STAMP VALUAT ION AUTHORITY DURING THE YEAR 1981. 3 ITA NO.2340/MDS/2015 4. ON APPEAL, THE LEARNED COMMISSIONER OF INCOME TA X (APPEALS) CONFIRMED THE ORDER OF THE LEARNED ASSESS ING OFFICER AGREEING WITH HIS VIEW. 5. BEFORE US, THE LEARNED AUTHORIZED REPRESENTATIVE SUBMITTED THAT THE LAND SOLD BY THE ASSESSEE WAS AG RICULTURAL LAND AS IT IS EVIDENT FROM THE KIST RECEIPTS AND PA TTA TRANSFER ORDER ISSUED BY GOVERNMENT AUTHORITIES FILED BY THE ASSESSEE BEFORE THE LEARNED ASSESSING OFFICER. FURTHER, THE LAND DID NOT FALL WITHIN THE MUNICIPALITY REGION OR CANTONME NT AREA BUT SITUATED IN THE ULLORE VILLAGE PANCHAYAT. HENCE, IT WAS PLEADED THAT THE ADDITION MADE BY THE REVENUE MAY B E DELETED. 6. THE LEARNED DEPARTMENTAL REPRESENTATIVE, ON THE OTHER HAND, RELIED ON THE ORDERS OF THE REVENUE. 7. WE HAVE HEARD BOTH THE PARTIES AND CAREFULLY PER USED THE MATERIALS AVAILABLE ON RECORD. FROM THE FACTS O F THE CASE, IT IS EVIDENT THAT THE LAND WAS USED BY THE ASSESSE E FOR AGRICULTURAL PURPOSE. THIS FACT IS CONFIRMED BY THE KIST 4 ITA NO.2340/MDS/2015 RECEIPTS AND OTHER RECORDS OF VILLAGE PANCHAYAT. IN THIS SITUATION, CLASSIFICATION OF LAND BY THE REGISTRATI ON DEPARTMENT OF TAMIL NADU FOR THE PURPOSE OF LEVYING STAMP DUTY WILL NOT CHANGE THE NATURE OF THE LAND. AS PER SECTION 2(14) (III) OF THE ACT AGRICULTURAL LAND IS EXCLUDED FROM THE DEFINI TION OF CAPITAL ASSET PROVIDED THE STIPULATED CONDITIONS MENTIONED THEREIN ARE MET. IN THE CASE OF THE ASSESSEE, THE L AND IS USED BY THE ASSESSEE FOR THE PURPOSE OF AGRICULTURE AND IT DOES NOT FALL WITHIN EIGHT KILOMETERS OF THE MUNICIPAL LIMIT . IN THIS SITUATION, WE ARE OF THE CONSIDERED VIEW THAT THE P ROVISIONS OF SECTION 45 OF THE ACT WILL NOT COME INTO PLAY. THER EFORE, WE HEREBY DIRECT THE LEARNED ASSESSING OFFICER TO DELE TE THE CAPITAL GAIN TAX IMPOSED ON THE ASSESSEE TOWARDS SA LE OF AGRICULTURAL LAND. 8. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON THE 1 ST JULY, 2016 SD/- SD/- ( . ) ( . ) (G.PAVAN KUMAR) ( A.MOHAN ALANKAMONY ) # % / JUDICIAL MEMBER % / ACCOUNTANT MEMBER 5 ITA NO.2340/MDS/2015 # /CHENNAI, ( /DATED 1 ST JULY, 2016 SOMU *+ ,+ /COPY TO: 1. APPELLANT 2. RESPONDENT 3. - () /CIT(A) 4. - /CIT 5. + 1 /DR 6. /GF