The DCIT, Circle-15, Ahmedabad V. Smt. Sudhaben Balkrishna Trivedi, Ahmedabad

ITA 2658/AHD/2011

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 94475 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 11 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-09-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 21-06-2017
• Assessment Year: 2008-2009
• Appeal Filed On: 24-10-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P L KUREEL
• Assessee Lawyers: H V VORA
• Keywords: Principle of natural justice; Corroborative evidences
• Section: 2; 143(3)

Judgement Text

ITA NO . 2658 /AHD/ 20 1 1 ASSESSMENT YEAR S : 2 0 0 8 - 09 PAGE 1 OF 4 IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD D BENCH, AHMEDABAD [CORAM: PRAMOD KUMAR AM AND KUL BHARAT JM] ITA NO. 2658 / AHD / 2 0 1 1 ASSESSMENT YEAR: 20 0 8 - 09 DY. COMMISSIONER OF INCOME TAX ....... .. . ..... APPELLANT CIRCLE - 15, AHMEDABAD . VS. SUDHABEN BALKRISHNA TRIVEDI .... .................. .... .. RESPONDENT 10, SBI SOCIETY, OPP. MANEKBAUG, AMBAVADI AHMEDABAD. [PAN A CAPT 7244 H ] APPEARANCES BY: P.L. KUREEL FOR THE A PPELLANT H.V. VORA FOR THE RE SPONDENT DATE OF CONCLUDING THE HEARI NG : JU LY 16 TH , 201 5 DATE OF PRONOUNCING THE ORDER : SEPTEMBER 29 TH , 2015 O R D E R PER PRAMOD KUMAR AM: 1. BY WAY OF THIS APPEAL, THE ASSESSING OFFICER HAS CHALLENGED CORRECTNESS OF THE ORDER DATED 11 TH AUGUST, 2011 PASSED BY THE LD . CIT(A) IN THE MAT T ER OF ASSESSMENT UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961 ( THE ACT HEREINAFTER) FOR THE ASSESSMENT YEAR 200 8 - 09 , ON THE FOLLOWING GROUND S : - 1. THE LEARNED CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION AND ALLOWED THE CLAIM U/ S. 54EC OF REC BOND OF RS.50,00,000/ - , HUTMENT CHARGES PAID OF RS.5,00,000/ - AND BROKERAGE PAID OF RS.3,12,500/ - . ITA NO . 2658 /AHD/ 20 1 1 ASSESSMENT YEAR S : 2 0 0 8 - 09 PAGE 2 OF 4 2. THE LEARNED CIT(A) HAS ERRED IN LAW AND ON F A CTS IN ADMITTING THE FRESH EVI D ENC E S AND SUBMISSION WITHOUT GIVING ANY OPPORTUNITY TO THE A.O . BEING HEARD ON T HE PRINCIPLES OF LAW AND NATURAL JUSTICE AND THER E BY VIOLATED T HE PROVISION OF RULE 46A OF THE I.T. RULES. 2. BRIEFLY STATED, THE RELEVANT MATERIAL FACTS A RE LIKE THIS. DURING THE COURSE OF ASSESSMENT PROCEEDING, THE ASSESSING OFFICE R NOTICED THAT THE ASSESSEE HAS SOLD PLOT OF L A ND TO M/S DEVDEEP MLL S DEVELOPERS PVT . LTD . FOR A CONSIDERATION OF RS.7,81,00,000/ - . THE ASSESSEE HAD CLAIMED DEDUCTION OF RS.3,12,500 / - FOR BROKERAGE AND RS. 5,00,000/ - AS COMPENSATION FOR REMOVAL OF HUTMENT . IN SUPPORT OF THE CLAIM OF PAY MENT OF BROKERAGE, THE ASSESSEE HAD FILED N AFFIDAVIT FROM THE RECIPIENT BUT ASSESSING OFFICER BRUSHED ASIDE THE SAME BY OBSERVING, INTER ALIA, THAT SUCH BIG DEALS ARE UNDERTAKEN BY PERSON WHO A RE HAVING PERMANENT OFFICE, ADDRESS, TELEPHONE NUMBER, PAN AND NAME IN THE MARKET. AS REGARDS THE PAYMENT FOR REMOVAL OF HUTMENT, THE ASSESSING OFFICER BRUSHED A SIDE THE DOCUMENTS, IN SUPPORT OF THE PAYMENT, AND ST A TED THAT THERE SHOULD HAVE BEEN POLICE COMPLAINT OR ANY OTHER CIVIL SUIT TO GET THE ILLEGAL OCCUPANT VACATED AND THAT THE ASSESSEE HAS NOT TRIED TO GET THE LAND VACA T ED THROUGH LEGAL MEANS BUT PAID SIMPLY RS.5, 00,000/ - WHICH IS NOT PRACTICAL APPROACH . THE ASSESSING OFFICER FURTHER NOTED THAT THERE IS A POSSIBILITY TH AT THE ASSESSEE MIGHT HAVE TAKEN CASH FROM THESE PEOPLE . IT WAS IN THIS BACKGROUND THAT THE DISALLOWANCES OF BROKERAGE OF RS.3,12,500/ - AND HUTMENT REMOVAL EXPENSES OF RS.5,00,000/ - WERE DISALLOWED. AGGRIEVED , ASSESSEE CARRIED THE MATTER IN APPEAL BEFOR E THE LD . CIT(A) WHO DELETED THESE DISALLOWANCES BY OBSERVING AS FOLLOWS : - 3. I HAVE CAREFULLY CONSIDERED THE SUBMISSION MADE BY A.R. THE PAYMENT OF BROKERAGE FOR S A LE OF PROPERTY WHICH IS HARDLY ABOUT 0.4% OF SALES PRICE WHICH IS IN THE LINE OF TREND P REVAILING IN THE MARKET. THE PAYMENT IS MADE TO OUTSIDERS WHO ARE NOT RELATIVE . THE SOURCE OF PAYMENT IS EXPLAINED AND THE IDENTITY IS PROVED A S ITA NO . 2658 /AHD/ 20 1 1 ASSESSMENT YEAR S : 2 0 0 8 - 09 PAGE 3 OF 4 THE AFFIDAVIT IS FILLED. IN THE ABSENCE OF ANY ADVERSE FINDING BY A.O., THE CONTENT OF AFFIDAVITS A RE DEEMED TO BE ACCEPTED. THEREFORE , THE BROKERAGE OF RS.3,12,500/ - SHOULD BE ALLOWED WHILE COMPUTING THE CAPITAL G A IN. THE GROUND OF APPEAL IS ALLOWED AND THE ADDITION OF RS.3,12,500/ - IS DELETED. 4. THE SECOND GROUND OF APPEAL IS REGARDING DISALLOWANCE OF RS. 5 ,00,000/ - PAID BY THE APPELLANT AS HUTMENT EXPENSES. THE FACTS OF THE CASE ARE THAT THE APPELLANT WAS THE OWNER OF THE PROPERTY BUT THE PROPERTY WAS OCCUPIED BY FOUR PERSONS IN HUT. THE APPELLANT HAS PAID RS.5,00,000/ - TO HUT OWNERS FOR GIVING VACANT POS SESSION OF LAND . THE ASSESSING OFFICER HA S MENTIONED IN THE ASSESSMENT ORDER THAT, AS THE DETAILS ABOUT THE PERSONS TO WHOM SUCH CHARGES ARE PAID ARE NOT FILLED, THE AMOUNT CANNOT BE ALLOWED. BEFORE ME, THE LEARNED A.R. HAS SUBMITTED THAT THE LAND WAS OC CUPIED BY 4 PERSONS. THOSE FOUR PERSONS RAISE THEIR OBJECTION FOR THE SALE OF LAND. THE APPELLANT WENT TO LEGAL LINE AND ADVOCATE ISSUED NOTICE TO 4 PERSONS FOR LITTLE CLEARANCE. COPY OF OBJECTIONS RAISED BY 4 PERSONS HAVE ALREADY BEEN SUBMI TT ED TO AO A ND FILLED BEFORE ME. THE APPELLANT HAS PAID RS.5,00,000/ - THROUGH CHEQUE ON 01.06.2007. AT THE TIME OF PAYMENT THE APPELLANT MADE AN AGREEMENT WITH THOSE 4 PERSONS AND THE SAID AGREEMENT IS ALSO NOTARISED AND FILLED BEFORE ME. IT IS ALSO SUBMITTED BEFOR E ME THAT EVEN AHMEDABAD MUNICIPAL CORPORATION HAS ALSO ISSUED DIRECTION TO REMOVE HUT ON ABOVE LAND BEFORE ISSUING NO OBJECTION IN RESPECT OF LAND. THIS PROVES BEYOND DOUBT THAT THE LAND WAS OCCUPIED BY HUTMENT. COPY OF NOTICE ISSUED BY AHMEDABAD MUNICI PAL CORPORATION IS FILLED BEFORE ASSESSING OFFICER AND IS ALSO FILLED BEFORE ME. IN CONNECTION WITH OBSERVATION OF ASSESSING OFFICER FOR REGISTRATION OF DOCUMENT , IT IS ARGUED THAT REGISTRATION IS NOT COMPULSORY FOR SUCH DOCUMENT AND NO REGISTRAR WOULD RE GISTER ANY DOCUMENT WHICH IS NOT TO BE REGISTERED UNDER PROVISION OF LAW. THE APPELLANT HAD EXECUTED DOCUMENT WITH 4 PERSONS AND HAS EXECUTED DOCUMENT BEFORE NOTARY. 5. I HAVE CAREFULLY CONSIDERED THE ARGUMENTS ADVANCED BY LEARNED A.R. THE NOTICE GIVEN TO ADVOCATE AS WELL AS RECORD OF MUNICIPAL CORPORATION PROVES THAT THE LAND WAS OCCUPIED BY HUTMENT . THE APPELLANT HAS MADE PAYMENT AFTER EXECUTING AGREEMENT WHICH IS NOTARISED. THEREFORE, THE PAYMENT MADE CANNOT BE DOUBTED. AS THE VACANT POSSESSION WAS NECESSARY FOR SALE OF LAND, THE EXPENDITURE INCURRED FOR PAYMENT OF HUTMENT CHARGES IS AVAILABLE WHILE COMPUTING LONG TERM CAPITAL GAIN. THIS GROUND OF APPEAL IS THEREFORE ALLOWED AND THE DISALLOWANCE OF RS.5,00,000/ - IS DELETED. 3. THE ASSESSING OFFI CER IS AGGRIEVED OF THE RELIEF SO GRANTED BY THE LD. CIT(A) AND IS IN APPEAL BEFORE US. ITA NO . 2658 /AHD/ 20 1 1 ASSESSMENT YEAR S : 2 0 0 8 - 09 PAGE 4 OF 4 4. HAVING HEARD THE RIV A L CONTENTIONS AND HAVING PERUSED THE MATERIAL ON RECORD, WE SEE NO REASONS TO INTERFERE IN THE WELL REASONED RELIEF GRANTED BY THE LD . CIT ( A ) . AS HE RIGHTLY OBSERVES, THE DEDUCTION S CLAIMED BY THE ASSESSEE ARE REASONABLY SUPPORTED BY DOCUMENTARY EVIDENCES A ND JUST BECAUSE THE ASSESSING OFFICER HAS SOME APPREHENSIONS, WITHOUT ANY SUPPORTING MATERI A L, THE DISALLOWANCES C A NNOT BE M A DE. IT WAS NOT FOR THE ASSESSING OFFICER TO CONSIDER WHAT OUGHT TO HAVE HAPPENED IN IDEAL CIRCUMSTANCES . ALL THAT HE WAS TO SEE WHETHER THERE WERE ANY INCONSISTENCIES IN THE CLAIM MADE BY THE ASSESSEE , OR WHETHER THE CLAIM SO MADE WAS DEVOID OF SUPPORTING EVIDENCES. CL EARLY , THAT WAS NOT THE CASE. THERE WAS THUS NO GOOD REASONS TO REJECT THE CLAIM OF DEDUCTION FOR BROKERAGE AND REMOVAL OF H UTMENTS. LEARNED CIT ( A ) WAS THUS QUITE JUSTIFIED IN GIVING THE IMPUGNED RELIEF. WE APPROVE T HE RELIEF SO GRANTED BY THE LD. CIT(A ) AND DECLINE TO INTERFERE IN THE MATTER. 5. IN THE RESULT, THE APPEAL IS DISMISSED. P RONOUNCED IN THE OPEN COURT ON THIS 29 TH DAY OF SEPTEMBER, 2015. SD/ - SD/ - KUL BHARAT PRAMOD KUMAR (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) AHMEDABAD , THE 29 TH DAY OF SEPTEMBER , 201 5 PBN/* COPIES TO: (1) THE APPELLANT (2) THE RESPONDENT (3) COMMISSIONER (4) CIT(A) (5) DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCHES, AHMEDABAD