The ITO, Ward-2, Vapi V. Shri Prakash Ramanlal Shah(HUF), Vapi

ITA 2417/AHD/2009

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 80536 (ITAT-AHMEDABAD)
• Duration Of Justice: 5 year(s) 3 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-11-2014
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 15-10-2014
• Assessment Year: 2004-2005
• Appeal Filed On: 17-08-2009
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: V K SINGH
• Assessee Lawyers: VIJAY RANJAN
• Keywords: Difference of opinion; Change of opinion; Reassessment proceedings
• Section: 147; 143(3)

Judgement Text

, , , , B, IN THE INCOME TAX APPELLATE TRIBUNAL AT AHMEDABAD, B BENCH . .. . . .. . , !' !' !' !', , , , #$ #$ #$ #$ # ## #. .. .# ## #. . . . % % % %, , , , &' ( & ' &' ( & ' &' ( & ' &' ( & ' BEFORE S/SHRI G.C. GUPTA, VICE-PRESIDENT AND N.S. SAINI, ACCOUNTANT MEMBER) ITA NO.2417/AHD/2009 WITH CO NO.208/AHD/2009 [ASSTT.YEAR : 2004-2005] ITO, VAPI WARD-2 VAPI. /VS. SHRI PRAKASH RAMANLAL SHAH (HUF) NEHRU STREET, VAPI. PAN AACHP 4326 E ( (( ( *+ *+ *+ *+ / APPELLANT) ( (( ( ,-*+ ,-*+ ,-*+ ,-*+ / RESPONDENT) ( . / & / REVENUE BY : SHRI V.K. SINGH, SR.DR 12 . / & / ASSESSEE BY : SHRI VIJAY RANJAN 3 . 24' / DATE OF HEARING : 15 TH OCTOBER, 2014 567 . 24' / DATE OF PRONOUNCEMENT : 25-11-2014 &8 / O R D E R PER G.C. GUPTA, VICE-PRESIDENT: THIS IS APPEAL OF THE REVENUE AND THE CO OF THE ASSESSEE FOR THE ASSTT.YEAR 2004- 05 ARE DIRECTED AGAINST THE ORDER OF THE CIT(A). THESE ARE BEING DISPOSED OF WITH CONSOLIDATED ORDER. ITA NO.2417/AHD/2009 (REVENUES APPEAL) 2. THE GROUND NO.1 OF THE APPEAL OF THE REVENUE IS AS UNDER: ITA NO.2417/AHD/2009 WITH CO -2- 1. ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND I N LAW, THE LD.CIT(A) HAS ERRED IN QUASHING THE REASSESSMENT PROCEEDINGS U/147 OF THE ACT WITHOUT CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE CASE BROUGHT IN BY THE AO IN ITS ENTIRETY. 1.1 THE LD.CIT(A) HAS ERRED IN OBSERVING THAT NO EV IDENCES PERTAINING TO THE SALE OF AGRICULTURE PRODUCE TO SHRI DILIP J. DESAI WERE COLLECTED BY THE AO WITHOUT CONSIDERING THE FACT TH AT SHRI DILIP J. DESAI HAS CATEGORICALLY DENIED TO HAVE MADE PURCHAS E OF AGRICULTURE PRODUCE FROM THE ASSESSEE IN THE STATEM ENT RECORDED ON OATH. 1.2 THE LD.CIT(A) HAS ERRED IN OBSERVING THAT COPY OF THE STATEMENT OF SHRI DILIP J. DESAI WAS NOT PROVIDED TO THE ASSESSE E WITHOUT CONSIDERING THE FACT THAT AFFIDAVIT FIELD BY SHRI D ESAI, CONTAINING IDENTICAL CONTENTS WAS PROVIDED TO ASSESSEE FOR CRO SS EXAMINATION. 1.3 THE LD.CIT(A) HAS ERRED IN HOLDING THAT THE REA SSESSMENT WAS BASED ON CHANGE OF OPINION WITHOUT CONSIDERING THE FACT THAT THE REASSESSMENT PROCEEDINGS WERE ON THE BASIS OF DEFIN ITE AND SPECIFIC INFORMATION RECEIVED BY THE AO. 3. THE LEARNED DR SUBMITTED THAT ALTHOUGH ORIGINAL ASSESSMENT IN THIS CASE WAS FRAMED UNDER SECTION 143(3) BUT REOPENING UNDER SECTION 147 WAS DONE WITHIN FOUR YEARS FROM THE END OF THE RELEVANT ASST .YEAR 2004-05. HE SUBMITTED THAT ONE SHRI DILIP J. DESAI HAS DENIED TO HAVE MAD E PURCHASES OF AGRICULTURE PRODUCE FROM THE ASSESSMENT IN THE STATEMENT RECORD ED BY THE DEPARTMENT. HE SUBMITTED THAT THE ASSESSEE WAS PROVIDED OPPORTUNIT Y TO CROSS-EXAMINE SHRI DILIP J. DESAI AND THE ASSESSEE HAS ALREADY AVAILED THE OPPORTUNITY AND HAS CROSS-EXAMINED SHRI DILIP J. DESAI. HE SUBMITTED T HAT THE ACTION UNDER SECTION 147 WAS VALID AS IT WAS BASED ON DEFINITE AND SPECI FIC INFORMATION RECEIVED BY THE DEPARTMENT. HE RELIED ON THE ORDER OF THE AO. 4. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED T HAT THE AGRICULTURE INCOME DECLARED BY THE ASSESSEE IN THE EARLIER AND SUCCEEDING ASSESSMENT YEARS WERE ACCEPTED BY THE DEPARTMENT. THE ASSESSEE ALON GWITH THREE OTHERS HAVE 83 ACRES OF AGRICULTURE LAND WITH 1500 MANGO TREES AND 1450 CHIKOO TREES THEREON. THE ASSESSEE WAS SPECIFICALLY ASKED DURING THE COUR SE OF ORIGINAL ASSESSMENT, ITA NO.2417/AHD/2009 WITH CO -3- WHICH WAS FRAMED UNDER SCRUTINY ASSESSMENT UNDER SE CTION 143(3) BY THE AO TO FURNISH PHOTO-COPY OF AGRICULTURE PRODUCE SALES MAD E WITH NAMES AND ADDRESS AND THE AMOUNT OF SALE. THE SAME WAS EXAMINED BY T HE AO AND WAS ACCEPTED BY HIM IN THE ORIGINAL ASSESSMENT. THE ASSESSEE HA S FILED NECESSARY EVIDENCES IN THIS REGARD BEFORE THE AO. HE SUBMITTED THAT IT IS A CASE OF CHANGE OF OPINION ON THE PART OF THE AO IN REOPENING THE ASSESSMENT, WHICH WAS NOT PERMISSIBLE UNDER THE LAW. HE RELIED ON THE ORDER OF THE CIT(A ). 5. WE HAVE CONSIDERED RIVAL SUBMISSIONS REGARDING L EGAL ISSUE OF VALIDITY OF REOPENING OF THE ASSESSMENT UNDER SECTION 147 OF TH E ACT. WE FIND THAT THE REOPENING UNDER SECTION 147 IS SOUGHT WITHIN FOUR Y EARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR. THE DEPARTMENT WAS HAVIN G DEFINITE INFORMATION IN THE SHAPE OF THE STATEMENT OF SHRI DILIP J. DESAI, WHO HAS DENIED TO HAVE MADE PURCHASES OF AGRICULTURE PRODUCE FROM THE ASSESSEE IN HIS STATEMENT RECORDED ON OATH BY THE DEPARTMENT. COPY OF THE STATEMENT OF SHRI DILIP J. DESAI WAS PROVIDED TO THE ASSESSEE AND AN OPPORTUNITY TO CROS S-EXAMINE HIM WAS ALSO GRANTED BY THE DEPARTMENT TO THE ASSESSEE. IN THES E FACTS OF THE CASE, IT COULD NOT BE SAID THAT THE REOPENING OF THE ASSESSMENT UNDER SECTION 147 IS BASED ON NO INFORMATION OR IT IS A CASE OF MERE CHANGE OF OPIN ION ON THE PART OF THE AO. IN THESE FACTS OF THE CASE, WE ARE OF THE VIEW THAT TH E ACTION OF THE AO IN REOPENING THE ASSESSMENT BY ISSUE OF NOTICE UNDER SECTION 147 WAS VALID, AND ACCORDINGLY, THE GROUND NO.1 OF THE REVENUE IS ALLOWED. 6. THE GROUND NO.2 OF THE REVENUES APPEAL IS AS UN DER: 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD.CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS. 8 LACS WITHOUT CONSIDERING THE FACT THAT ASSESSEE FAILED TO DISCHA RGE THE BURDEN OF PROVING THE AGRICULTURE INCOME WITH SUBSTANTIVE EVI DENCES. 7. THE LEARNED DR SUBMITTED THAT THE ONUS WAS ON TH E ASSESSEE TO PROVE THAT THE ASSESSEE WAS HAVING AGRICULTURE INCOME OF RS.8 LAKHS DURING THE RELEVANT PERIOD AND IN THIS CASE, THE ASSESSEE HAS FAILED TO DISCHARGE ITS ONUS AND COULD ITA NO.2417/AHD/2009 WITH CO -4- NOT FILE ANY EVIDENCE IN SUPPORT OF ITS CASE. HE S UBMITTED THAT IN THESE FACTS, THE AGRICULTURE INCOME DECLARED BY THE ASSESSEE WAS RIG HTLY ASSESSED UNDER THE HEAD INCOME FROM OTHER SOURCES BY THE AO. HE RELIED O N THE ORDER OF THE AO. 8. THE LEARNED COUNSEL FOR THE ASSESSEE HAS OPPOSED THE SUBMISSION OF THE LEARNED DR. HE SUBMITTED THAT THE ASSESSEE ALONGWI TH OTHER THREE FAMILY MEMBERS OWN 83 ACRES OF FERTILE AGRICULTURE LAND WI TH ORCHARD OF 1500 MANGO TREES AND 1450 CHIKOO TREES THEREON. THE AGRICULTURE INCOME DECLARED BY THE ASSESSEE IN THE PRECEDING AND SUCCEEDING ASSESSMENT YEAR WAS ACCEPTED BY THE DEPARTMENT, EVEN IN SCRUTINY ASSESSMENT. HE SUBMIT TED THAT INITIAL ONUS PLACED ON THE ASSESSEE HAS BEEN DISCHARGED BY IT BY FILING THE NECESSARY EVIDENCE IN THE FORM OF COPY OF REVENUE RECORDS ETC. HE SUBMITTED THAT THE ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE WITH THE DECISION OF THE ITA T, AHMEDABAD IN THE CASE OF CO-OWNER OF THE AGRICULTURE LAND IN QUESTION, SMT. NIRMALABEN RAMANAL SHAH FOR THE SAME ASSTT.YEAR 2004-05 IN ITA NO.2416/AHD/ 2009 DATED 16.10.2009 WHEREIN THE TRIBUNAL HAS ACCEPTED THE AGRICULTURE I NCOME DECLARED BY THE ASSESSEE, AND HAS DECIDED THE ISSUE IN FAVOUR OF TH E ASSESSEE, AND THE REVENUES APPEAL WAS DISMISSED. HE RELIED ON THE ORDER OF TH E CIT(A). 9. WE HAVE CONSIDERED RIVAL SUBMISSION AND PERUSED THE ORDERS OF THE AO AND THE CIT(A), AND COPIES OF VARIOUS DOCUMENTS FIL ED BY THE ASSESSEE IN THE COMPILATION BEFORE US. WE FIND THAT THE AGRICULTUR E INCOME DECLARED BY THE ASSESSEE IN THE PRECEDING AND SUCCEEDING ASSESSMENT YEAR HAS BEEN ACCEPTED BY THE DEPARTMENT IN THE SCRUTINY ASSESSMENT FRAMED UN DER SECTION 143(3) OF THE ACT. FOR THE RELEVANT ASSTT.YEAR 2004-05 ALSO AGRI CULTURE INCOME DECLARED AT RS.8 LAKHS WAS ACCEPTED IN ASSESSMENT FRAMED UNDER SCRUTINY ASSESSMENT MADE BY THE AO. DURING THE COURSE OF ORIGINAL ASSESSMEN T PROCEEDINGS, THE AO HAS MADE A SPECIFIC QUERY TO THE ASSESSEE TO FURNISH PH OTO COPY OF AGRICULTURE PRODUCE SALE MADE WITH NAMES, ADDRESS AND THE AMOUN T OF AGRICULTURE PRODUCE. THE ASSESSEE HAS COMPLIED WITH THE SAID QUERY OF TH E AO, AND THEREAFTER THE AO HAS ACCEPTED THE AGRICULTURE INCOME DECLARED BY THE ASSESSEE IN ITS RETURN OF ITA NO.2417/AHD/2009 WITH CO -5- INCOME. THE ASSESSEE HAS FILED DETAILED LEDGER ACC OUNT OF AGRICULTURE INCOME ALONG WITH EVIDENCE OF SALES AND EXPENDITURE INCURR ED FOR THE RELEVANT PERIOD. THE ASSESSEE HAS ALSO FILED PHOTO COPY OF EXTRACT F ROM THE REVENUE RECORD TO PROVE THE LAND HOLDING OWNED BY THE ASSESSEE AND TH REE OTHER FAMILY MEMBERS. COPY OF WHICH HAS BEEN FILED IN THE COMPILATION BEF ORE US. WE FIND THAT THE AO IN THE IMMEDIATE SUCCEEDING ASSTT.YEAR 2005-06 HAS ACCEPTED THE AGRICULTURE INCOME DECLARED AT HIGHER FIGURE OF RS.9,39,660/- B Y THE ASSESSEE IN SCRUTINY ASSESSMENT FRAMED UNDER SECTION 143(3) OF THE ACT V IDE ORDER DATED 22.2.2007. THE ASSESSEE HAS FILED A CHART SHOWING THE DETAILS OF GROSS AGRICULTURE INCOME, EXPENSES INCURRED ON AGRICULTURE OPERATIONS ETC. FO R THE ASSTT.YEAR 2001-02 TO 2006-07. THE ASSESSEE HAS ALSO FILED COPY OF THE A GREEMENT DATED 1.5.2003 ENTERED INTO BY THE ASSESSEE WITH SHRI DILIP J. DES AI. COPIES OF THE AFFIDAVITS OF THREE NEIGHBORHOOD FARMERS CONFIRMING THAT SHRI DIL IP J. DESAI HAS PLUCKED MANGOES FROM THE LAND OF THE ASSESSEE WERE ALSO FIL ED. WE FIND THAT THE REVENUE COULD NOT CONTROVERT SINGLE EVIDENCE FILED BY THE ASSESSEE IN THIS BEHALF. THE ISSUE IS COVERED IN FAVOUR OF THE ASSE SSEE WITH THE DECISION OF THE ITAT, AHMEDABAD IN THE CASE OF CO-OWNER OF THE SAME AGRICULTURE LAND, SMT. NIRMALABEN RAMANLAL SHAH FOR THE SAME ASSTT.YEAR 20 04-05 IN ITA NO.2416/AHD/2009 DATED 16.10.2009 WHEREIN THE AGRIC ULTURE INCOME FROM THE SAME AGRICULTURE LAND INCLUDING THE FRUITS FROM THE ORCHARD DECLARED BY THE ASSESSEE, WERE ACCEPTED. THE TRIBUNAL IN ITS ORDER HAS OBSERVED THAT THE ASSESSEES CLAIM OF RECEIPT OF AGRICULTURE INCOME PER SE COULD NOT BE OUTRIGHT REJECTED AND APART FROM THIS, ONE CANNOT RULE OUT T HE POSSIBILITY OF SHRI DILIP J. DESAI TAKING A STAND, AS HE DID, FOR AVOIDING HIS T AX LIABILITY BECAUSE IN HIS CASE, THE CONSEQUENTIAL INCOME WOULD NOT BE EXEMPT AS HIS AGRICULTURE INCOME. IN THESE FACTS OF THE CASE, WE ARE OF THE VIEW THAT IN THE ABSENCE OF ANY EVIDENCE BROUGHT ON RECORD BY THE REVENUE, TO DISBELIEVE THE CLAIM OF THE ASSESSEE REGARDING AGRICULTURE INCOME DECLARED BY IT, THERE IS NO MISTAKE IN THE ORDER OF THE CIT(A) IN DECIDING THE ISSUE IN FAVOUR OF THE A SSESSEE, AND ACCORDINGLY, THE GROUND NO.2 OF THE REVENUE IS DISMISSED. ITA NO.2417/AHD/2009 WITH CO -6- CO NO.208/AHD/2009 (ASSESSEES CO) 10. THE ONLY EFFECTIVE GROUND OF THE CO OF THE ASSE SSEE IS THE GROUND NO.1, WHICH IS REPRODUCED BELOW: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE, THE CIT(A) SHOULD HAVE FURTHER HELD SPECIFICALLY THAT THE REOP ENING U/S.147/148 WAS WHOLLY VITIATED ON ACCOUNT OF DEPARTMENTS PERSISTE NT REFUSAL TO GIVE TO THE ASSESSEE A COPY OF A PURPORTED STATEMENT OF SHR I DILIP J. DESAI IN SPITE OF THE FACT THAT THE DEPARTMENT SPECIFICALLY CLAIMED THAT, THAT STATEMENT FORMED THE VERY BASIS OF REOPENING OF ASS ESSMENT U/S.147/148. 11. THE LEARNED COUNSEL FOR THE ASSESSEE HAS NOT PR ESSED THE GROUND OF THE CO, AND ACCORDINGLY, THE SAME IS DISMISSED. 12. IN THE RESULT, THE APPEAL OF THE REVENUE IS PAR TLY ALLOWED AND THE CO OF THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON THE DATE MENTIONE D HEREINABOVE. SD/- SD/- ( # ## # . .. . # ## # . . . . % % % % /N.S.SAINI) &' ( &' ( &' ( &' ( /ACCOUNTANT MEMBER ( . .. . . .. . /G.C. GUPTA) !' !' !' !' /VICE-PRESIDENT C OPY OF THE ORDER FORWARDED TO: 1) : APPELLANT 2) : RESPONDENT 3) : CIT(A) 4) : CIT CONCERNED 5) : DR, ITAT. BY ORDER DR/AR, ITAT, AHMEDABAD