Amratbhai R Rathod, Ahmedabad V. Income Tax Officer, Ward-6(3), Ahmedabad

ITA 2508/AHD/2015

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 8208 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 2 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-10-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2008-2009
• Appeal Filed On: 24-08-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: ANKIT M TALSANIA
• Keywords: Reason to believe; Reassessment proceedings
• Section: 45(5); 147

Judgement Text

ITA NO.2508/AHD/2015 AMRATBHAI R RATHOD VS. ITO ASSESSMENT YEAR: 2008-09 PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, AHMEDABAD [ BEFORE SHRI PRAMOD KUMAR, ACCOUNTANT MEMBER ] ITA NO. 2508/AHD/2015 ASSESSMENT YEAR : 2008-09 AMRATBHAI R RATHOD .............APPELLANT SATWARA SOCIETY, OPP. RAILWAY STATION, AT &TAL : DHANDHUKA, AHMEDABAD [PAN : AMJPR 7824 A] VS. THE ITO, .......................RESPONDENT WARD 6 (3), AHMEDABAD APPEARANCES BY: ANKIT M TALSANIA FOR THE APPELLANT KEYUR PATEL FOR THE RESPONDENT DATE OF CONCLUDING THE HEARING : 17.08.2017 DATE OF PRONOUNCING THE ORDER : 27.10.2017 O R D E R 1. THIS APPEAL IS DIRECTED AGAINST THE ORDER DATED 29 TH MAY 2015 PASSED BY THE CIT(A) IN THE MATTER OF ASSESSMENT UNDER SECTION 14 3(3) R.W.S. 148 OF THE INCOME- TAX ACT, 1961, FOR THE ASSESSMENT YEAR 2008-09. 2. IT IS A CASE OF REOPENED ASSESSMENT. THE REASON S FOR REOPENING THE ASSESSMENT, AS RECORDED BY THE ASSESSING OFFICER ON 11.12.2012, ARE AS FOLLOWS:- THE ASSESSEE HAS FILED HIS RETURN OF INCOME FOR A. Y. 2008-09 ON 26/02/2009 VIDE ACK. NO. 631007612 DECLARING TOTAL INCOME OF R S.15,000/-. ON VERIFICATION OF TDS CERTIFICATE, IT IS OBSERVED THAT THE ASSESSE E HAS RECEIVED PAYMENT OF RS.17,20,492/- IN THE NATURE OF INTEREST FOR DIFFER ENCE IN COMPENSATION FOR COMPULSORY ACQUISITION OF AGRICULTURE LAND FROM SAR DAR SAROVAR NIGAM LTD. CHIEF ENGINEERS S B C 6/3, M S BUILDING RACE COURSE , RAJKOT - 360001. HOWEVER, THE ASSESSEE HAS NOT SHOWN INTEREST INCOME OF RS. 17,05,492/- ON THE RECEIPT BASIS IN THE A.Y. 2008-09. THEREFORE AS PER THE DECISION OF HON'BLE SUPREME COURT HELD IN THE CASE OF CIT FARIDABAD VS GHANSHYAM (HUF) (2009) 182 TAXMAN 368 (SC) CIVIL APPEAL NOS. 4401 T O 4420, 4422 TO 4426 OF ITA NO.2508/AHD/2015 AMRATBHAI R RATHOD VS. ITO ASSESSMENT YEAR: 2008-09 PAGE 2 OF 3 2009 ON JULY 2009. THE INTEREST INCOME OF RS.17,05, 492/- HAS ESCAPED INCOME BY THE ASSESSEE. THEREFORE, I HAVE REASON TO BELIEVE THAT THE INCOME CHARGEABLE TO TAX EXCEEDING RS.1 LAC HAS ESCAPED FROM ASSESSMENT AND THE CASE OF THE ASSESSEE IS REQUIRED TO BE RE-OPENED FOR THE A.Y. 2 008-09 U/S. 147 OF THE I.T. ACT. IN VIEW OF THE ABOVE FACTS, YOUR HONOUR IS REQUESTE D TO KINDLY ACCORD NECESSARY APPROVAL FOR ISSUE OF NOTICE U/S. 148 IN THIS CASE FOR A.Y. 2008-09. 3. AGGRIEVED, INTER ALIA, BY THE REOPENING SO MADE, ASSESSEE CARRIED THE MATT ER IN APPEAL BEFORE THE CIT(A) BUT WITHOUT ANY SUCCESS . NOT SATISFIED, THE ASSESSEE IS IN FURTHER APPEAL BEFORE ME. 4. I HAVE HEARD THE RIVAL CONTENTIONS, PERUSED THE MATERIAL ON RECORD AND DULY CONSIDERED FACTS OF THE CASE IN THE LIGHT OF THE AP PLICABLE LEGAL POSITION. 5. AS LEARNED COUNSEL FOR THE ASSESSEE RIGHTLY POIN TS OUT THAT THE VERY FUNDAMENTAL REASON OF REOPENING THE ASSESSMENT, I.E . NON-CONSIDERATION OF HONBLE SUPREME COURTS JUDGMENT IN THE CASE OF GHANSHYAM H UF (SUPRA) IS INCORRECT REASONS BECAUSE THE ASSESSING OFFICER HAD DULY CONS IDERED THE SAID DECISION WHILE FRAMING THE ASSESSMENT WHICH WAS REOPENED. IT IS E VIDENT FROM THE FOLLOWING OBSERVATIONS MADE BY THE ASSESSING OFFICER IN ORIGI NAL ASSESSMENT ORDER:- IN VIEW OF THE JUDGEMENT OF HON'BLE SUPREME COURT IN CASE OF CIT V/S, GHANSHYAM HUF IN CIVIL APPEAL NO.4401 TO 4420 AND 4 422 TO 4426 OF 2009 DID. 16/07/2009, INTEREST AMOUNT RECEIVED BY THE AS SESSEE FROM SARDAR SAROVAR NIGAM WAS IN THE NATURE OF 'ENHANCED COMPEN SATION U/S. 45(5). SINCE THE ENHANCED COMPENSATION/CONSIDERATION, INCL UDING INTEREST BECOMES PAYABLE AT DIFFERENCE STAGES, THE RECEIPT OF ENHANC ED COMPENSATION/ CONSIDERATION IS TO BE TAXED IN THE YEAR OF RECEIPT , SUBJECT TO ADJUSTMENT, IF ANY UNDER S. 155(16), LATER ON. EVEN IN CASES WHERE PEN DING APPEAL, THE COURT/TRIBUNAL/AUTHORITY PERMITS THE CLAIMANT TO WI THDRAWN THE DISPUTED ENHANCED COMPENSATION AGAINST SECURITY OR OTHERWISE , THE SAME IS LIABLE TO BE TAXED UNDER SECTION 45(5). EVEN BEFORE THE INSER TION OF CL.(C) IN S..45(5) AND 155(16) W.E.F. 1ST APRIL, 2004 THE RECEIPT OF E NHANCED COMPENSATION WAS TAXABLE UNDER S, 45 (5)(B) IN THE YEAR OF RECEIPT W HICH IS ONLY REINFORCED BY INSERTION OF CL.(C).' PAYMENT RECEIVED BY THE ASSESSEE OF RS. 17,20,491/- IS IN THE NATURE OF INTEREST WHILE MAKING PAYMENT OF COMPENSATION FOR C OMPULSORY ACQUISITION OF AGRICULTURE LAND IS TREATED AS ENHANCED COMPENSATIO N, WHICH IS TAXABLE U/S 45(5) IN VIEW OF ABOVE JUDGMENT AND ADDED BACK TO T HE TOTAL INCOME OF THE ASSESSEE ITA NO.2508/AHD/2015 AMRATBHAI R RATHOD VS. ITO ASSESSMENT YEAR: 2008-09 PAGE 3 OF 3 6. THE PLEA OF THE ASSESSEE IS THUS INDEED WELL TAK EN. I UPHOLD THE PLEA AND HOLD THAT THE REASONS RECORDED FOR REOPENING, BEING FACTUALLY INCORRECT, ARE UNSUSTAINABLE IN LAW. I, THEREFORE, VACATE THE IMP UGNED REASSESSMENT PROCEEDINGS. AS THE REASSESSMENT ITSELF STANDS QUASHED, ALL OTHE R ISSUES RAISED BY THE ASSESSEE ARE ONLY ACADEMIC. THE REASSESSMENT ORDER THUS STA NDS QUASHED. 7. IN THE RESULT, THE APPEAL IS ALLOWED IN THE TERM S INDICATED ABOVE. PRONOUNCED IN THE OPEN COURT TODAY ON THE 27 TH OCTOBER, 2017. SD/- PRAMOD KUMAR (ACCOUNTANT M EMBER) AHMEDABAD, THE 27 TH DAY OF OCTOBER, 2017 **BT COPIES TO: (1) THE APPELLANT (2) THE RESPONDENT (3) COMMISSIONER (4) CIT(A) (5) DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER TRUE COPY ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCHES, AHMEDABAD 1. DATE OF DICTATION: ......TWO PAGES MANUSCRIPTS OF HONBLE AM ATTACHED....TYPED ON 27.10.2017 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE T HE DICTATING MEMBER: ... 27.10.2017........ 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR . P.S./P.S.: .... 27.10.2017... . 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE TH E DICTATING MEMBER FOR PRONOUNCEMENT: 27.10.2017 ... 5. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK : ...30.10.2017... 6. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK : . 7. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER: