Shri Bhudarbhai M. Prajapati, Baroda V. The Income Tax Officer, Ward-3(1), Baroda

ITA 2750/AHD/2014

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 0544 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 year(s) 11 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-09-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 24-07-2019
• Assessment Year: 2010-2011
• Appeal Filed On: 15-10-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: LALIT P JAIN
• Assessee Lawyers: M K PATEL
• Keywords: Sale consideration of property below Jantri Value; Corroborative evidences
• Section: 143(3); 54B; 50C

Judgement Text

, C IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, AHMEDABAD BEFORE SHRI MAHAVIR PRASAD, JUDICIAL MEMBER &SHRI AMARJIT SINGH, ACCOUNTANT MEMBER ./I.T.A. NO. 2750/AHD/2014 ( / ASSESSMENT YEAR: 2010-11) BHUDARBHAI M PRAJAPATI 31, JAWAHARNAGAR SOCIETY, NEAR ABHILASH CHAR RASTA, NEW SAMA ROAD, BARODA- 390008 / VS. ITO WARD-3(1), AAYKAR BHAVAN, RACE COURSE CIRCLE, BARODA- 390007 ./ ./PAN/GIR NO. : ACP PP2 671 P ( /APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY : SHRI M. K. PATEL, AR / RESPONDENT BY: SHRI LALIT P. JAIN, SR. DR ! /DATE OF HEARING 24/07/2019 '# ! / DATE OF PRONOUNCEMENT 16/09/2019 $% /O R D E R PER AMARJIT SINGH - AM: THIS APPEAL FILED BY THE ASSESSEE FOR A.Y. 2010-11 , ARISE FROM ORDER OF THE CIT(A)-II, BARODA DATED 05.08.2014, IN PROCEEDINGS UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT. 2. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE ARE READ AS UNDER:- 1. THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) IS AGAINST LAW AND FACTS OF THE CASE. 2. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) -II, BARODA ERRED IN CONFIRMING THE ORDER OF THE ASSESSING OFFICER ASSES SING THE APPELLANT ON A TOTAL INCOME OF RS. 66,94,242/- U/S. 143(3) OF THE I T AC T, 1961. ITA NO. 2750/AHD/2014 [BHUDARBHAI M PRAJAPATI VS. ITO] A.Y. 2010-11 2 3. THE LEARNED COMMISSIONER OF INCOME TAX ERRED IN SUMMARILY HOLDING THAT THE APPELLANT HAS NOT REBUTTED THE FINDINGS OF THE ASSE SSING OFFICER WITH ANY RELIABLE EVIDENCE. 4. THE LEARNED COMMISSIONER OF INCOME TAX, ERRED IN NOT DECIDING UPON FOLLOWING ALTERNATIVE GROUNDS OF APPEAL RAISED BY T HE APPELLANT. A. GROUND NO. VI) THE LEARNED ASSESSING OFFICER ERRED IN HOLDING THA T THE APPELLANT IS NOT ENTITLED TO THE DEDUCTION FOR RS. 42,29,500/- PAID BY THE PURCHASER IN GOVERNMENT ACCOUNT FOR CONVERTING THE LAND FROM UNDER NEW COND ITION TO UNDER OLD CONDITION. B. GROUND NO. VII) THE LEARNED ASSESSING OFFICER ERRED IN NOT ALLOWIN G DEDUCTION U/S 54B OF THE INCOME TAX ACT, 1961 IN RESPECT OF AGRICULTURAL LAN D PURCHASED BY THE APPELLANT WITHIN THE TIME LIMIT PRESCRIBED U/S. 54B. 5. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) -II, ERRED IN NOT PROPERLY APPRECIATING THE FACTS OF THE CASE AND SUBMISSIONS MADE ON BEHALF OF THE APPELLANT. 6. IT IS PRAYED THAT THE ADDITION OF RS. 64,35,862/ - ON ACCOUNT OF LONG TERM CAPITAL GAIN BE DELETED. 3. THE FACT IN BRIEF IS THAT RETURN OF INCOME DECLA RING INCOME OF RS. 2,58,380/- WAS FILED ON 28.10.2010. THE AO HAS FINALIZED THE ASSESSMENT U/S. 143(3) OF THE ACT, ON 01.03.2013 AND DETERMINED THE TOTAL INCOME AT RS . 66,94,242/- AFTER MAKING ADDITION ON ACCOUNT OF LONG TERM CAPITAL GAIN OF RS . 64,35,862/-. THE FACT PERTAINED TO THE ADDITION MADE IS THAT TH ERE WAS AN AIR INFORMATION ARTICULATING THAT ASSESSEE HAS SOLD IMMOVABLE PROPE RTY FOR THE CONSIDERATION OF RS. 57,29,500/- ON 27.08.2009 AND THIS TRANSACTION WAS NOT REFLECTED IN THE RETURN OF INCOME. DURING THE ASSESSMENT THE ASSESSEE WAS SHOW -CAUSED FOR NOT SHOWING ANY TRANSACTION OF CAPITAL GAIN ON THE SALE OF THE SAID PROPERTY. ON VERIFICATION OF THE DETAIL SUBMITTED BY THE ASSESSEE, IT WAS DISCERNED TO THE AO THAT THE IMMOVABLE PROPERTY WAS IN THE NAME OF SHRI SURENDRABHAI JASHB HAI AMIN AND SHRI JITENDRA JASHBHAI AMIN. THIS OWNERS OF THE IMMOVABLE PROPER TY HAVE EXECUTED IRREVOCABLE POWER OF ATTORNEY IN FAVOUR OF ASSESSEE ON 15.06.19 98. THE IMMOVABLE PROPERTY BEARING R.S. NO. 477 HAS BEEN SOLD BY THE ASSESSEE AS A POWER OF ATTORNEY HOLDER FOR CONSIDERATION OF RS. 57,29,500/- VIDE SALE DEED EXE CUTED ON 27.08.2009. THE SALE ITA NO. 2750/AHD/2014 [BHUDARBHAI M PRAJAPATI VS. ITO] A.Y. 2010-11 3 VALUE OF THE PROPERTY AS PER STAMP DUTY PAID WAS TO THE AMOUNT OF RS. 84,95,000/. THE ASSESSEE CONTENDED THAT HE HAD SOLD THE SAID LAND A S A POWER OF ATTORNEY HOLDER OF THE LAND ON BEHALF OF THE OWNERS SHRI SURENDRA JASHBHAI AMIN AND SHRI JITENDRA JASHBHAI AMIN BOTH RESIDING AT VILLAGE SAMA, DISTRICT VADODA RA. THE AO HAS NOT AGREED WITH THE CONTENTION OF THE ASSESSEE AND OBSERVED THAT AS SESSEE HAS TAKEN OVER THE FULL OWNERSHIP OF THE LAND BY IRREVOCABLE POWER OF ATTOR NEY EXECUTED ON 15.07.1998. THE AO HAS ALSO OBSERVED THAT ASSESSEE HAS EXECUTED THE SALE DEED IN THE CAPACITY OF POWER OF ATTORNEY HOLDER AND THERE WAS NO SIGNATURE OR APPROVAL OF THE LAND OWNER ON THE SALE SEED AND THE BUYER OF THE PROPERTY HAVE AL SO CONFIRMED IN THEIR STATEMENT THAT THEY HAVE PURCHASED THE AFORESAID IMMOVABLE PROPERT Y FROM THE ASSESSEE. CONSEQUENTLY, THE AO HAS MADE ADDITION OF RS. 64,35 ,862/- AS LONG TERM CAPITAL GAIN EARNED ON THE SALE OF THE AFORESAID PROPERTY AS PER PROVISION OF SEC. 50C (1) OF THE ACT IN THE HAND OF THE ASSESSEE. THE AO HAS ALSO STATE D THAT ASSESSEE WILL NOT GET ANY BENEFIT U/S. 54B OF THE ACT AS THE LAND WHICH WAS S OLD ON 27.08.2009 HAVING R.S. NO. 477 WAS NOT BEING USED FOR AGRICULTURE PURPOSE AND ALSO HELD THAT ASSESSEE WILL NOT GET BENEFIT ON DEDUCTION OF SALE CONSIDERATION OF THE P REMIUM PAID FOR THE CHANGE FROM NEW CONDITION TO OLD CONDITION AMOUNTING TO RS. 42, 29,500/- AS THE PAYMENT HAS BEEN MADE BY THE PURCHASER DIRECTLY TO THE GOVERNMENT AC COUNT. 4. AGGRIEVED ASSESSEE HAS FILED APPEAL BEFORE THE L D. CIT(A). LD. CIT(A) HAS DISMISSED THE APPEAL OF THE ASSESSEE RETREATING THE FINDING OF THE AO. 5. DURING THE COURSE OF APPELLATE PROCEEDING BEFORE US THE LD. COUNSEL HAS FURNISHED PAPER BOOK COMPRISING DETAILS AND COPIES OF DOCUMENTS FILED BEFORE THE AO AND CIT(A) AT THE TIME OF HEARING. THE LD. COUNSEL HAS CONTENDED THAT LD. CIT(A) HAS SIMPLY DISMISSED THE APPEAL OF THE ASSESSEE BY RETREATING THE FINDING OF THE AO WITHOUT CONSIDERING THE SUBMISSION AND DETAIL FURNI SHED BY THE ASSESSEE AGAINST THE ADDITION MADE BY THE AO. HE HAS FURTHER STATED THA T LD. CIT(A) HAS NOT PASSED SPEAKING ORDER WHILE ADJUDICATING THE APPEAL OF THE ASSESSEE. THE RELEVANT DECISION OF THE LD. CIT(A) IS REPRODUCED AS UNDER:- ITA NO. 2750/AHD/2014 [BHUDARBHAI M PRAJAPATI VS. ITO] A.Y. 2010-11 4 3.2.3. DURING THE APPELLATE PROCEEDINGS BEFORE ME , THE FINDINGS OF THE ASSESSING OFFICER HAVE NOT BEEN REBUTTED WITH ANY RELIABLE EV IDENCE. THE APPELLANT HAS NOT BEEN ABLE TO DEMONSTRATE AS TO HOW THE SO CALLED OWNERS HAE SHOWN THE INCOME IN THEIR HANDS. EVEN THE WIFE OF THE ASSESSEE SMT. HANSA BH UDARBHAI PRAJAPATI HAS RECEIVED SUM OF RS. 15,00,000/- ON 27.08.2009 AS PART OF SAL E CONSIDERATION IN WHOSE NAME THE ASSESSEE HAD MADE ONE BANAKHAT ON 28.08.1998. TH IS HAS NOT BEEN DISPUTED BY THE APPELLANT. HOWEVER, ON VERIFICATION OF THE RETURN OF INCOME OF SMT. HANSA BHUDARBHAI PRAJAPATI FOR A.Y. 2010-11, IT IS SEEN T HAT SHE HAS NOT OFFERED THIS AMOUNT OF RS. 15,00,000/- FOR TAX IN VIEW OF THE DETAILED FACTS MENTIONED IN PARA 3.2.2 ABOVE, THE CONTENTION OF THE ASSESSEE IS NOT ACCEPTABLE AN D THE ADDITION MADE BY THE ASSESSING OFFICER IS CONFIRMED. 6. ON THE OTHER HAND, THE LD. DR HAS SUPPORTED THE ORDER OF THE LOWER AUTHORITIES. 7. WE HAVE HEARD BOTH THE SIDES AND PERUSED THE MA TERIAL ON RECORD. THE ISSUE IN THE APPEAL FILED BY THE ASSESSEE IS PERTAINED TO TH E ADDITION OF RS. 64,35,862/- OF LONG TERM CAPITAL GAIN ON SALE OF AGRICULTURAL LAND BY T HE ASSESSEE ACTING UNDER POWER OF ATTORNEY GRANTED BY THE OWNER OF AGRICULTURAL LAND. THE LD. COUNSEL HAS BROUGHT TO OUR NOTICE THAT AT THE TIME OF ASSESSMENT PROCEEDIN G AND APPELLATE PROCEEDING THE ASSESSEE HAS EXPLAINED THAT HE HAS EXCLUSIVELY EXER CISED THE POWER ON THE BEHALF OF LAND OWNER AND HE HAS NOT BEEN CONFERRED ANY RIGHT OF OWNERSHIP TO THE SOLD PROPERTY AND THE ENTIRE SALE CONSIDERATION WAS PAID IN TO TH E STATE BANK OF INDIA BY THE PURCHASERS ON BEHALF OF THE SELLERS FOR CONVERSION OF LAND FOR NEW CONDITION TO OLD CONDITION AND NO PART OF CONSIDERATION WAS PAID TO THE ASSESSEE IN ANY MANNER. THE ASSESSEE HAS ALSO SUBMITTED A COPY OF ORDER OF COLL ECTOR OF VADODARA ON THE APPLICATION MADE BY THE BOTH THE LAND OWNER FOR DEP OSITING MINIMUM AMOUNT OF RS. 42,29,500/- PLACED AT PAGE NO. 39 AND 40 OF THE PAP ER BOOK. THE ASSESSEE HAS ALSO FURNISHED BEFORE THE LD. CIT(A) A COPY OF INDEX FRO M THE SUB-REGISTER OFFICE SHOWING THE NAME OF PERSON WHO HAVE SOLD THE PROPER TY AS WELL AS THE NAME OF PERSON WHO HAVE PURCHASED THE PROPERTY AND THE SAME WAS AL SO PLACED IN THE PAPER BOOK. THE LD. COUNSEL HAS ALSO SUBMITTED THAT LOWER AUTHO RITIES HAVE NOT CONSIDERED THE SUPPORTING EVIDENCES THAT THE SOLD LAND WAS ALSO BE ING USED FOR AGRICULTURE PURPOSE AND ON ASSUMPTION BASIS THE ALTERNATIVE CLAIM OF TH E ASSESSEE FOR DEDUCTION U/S. 54B WAS DENIED. ITA NO. 2750/AHD/2014 [BHUDARBHAI M PRAJAPATI VS. ITO] A.Y. 2010-11 5 IN THE LIGHT OF THE ABOVE FACTS AND CIRCUMSTANCES WE OBSERVE THAT LD. CIT(A) HAS NOT ADJUDICATED THE CASE OF THE ASSESSEE BY PAS SING A SPEAKING ORDER. IT IS CLEAR FROM THE ABOVE FACTS THAT ALL THE ISSUES AND MATERI AL FURNISHED BY THE ASSESSEE DURING THE COURSE OF APPELLATE PROCEEDING BEFORE THE LD. C IT(A) HAS NOT BEEN CONSIDERED BY THE LD. CIT(A) WHILE ADJUDICATING THE APPEAL OF THE ASSESSEE. THE PROVISION OF SEC. 250(6) OF THE ACT WHICH REQUIRE THAT WHILE DISPOSIN G THE APPEAL OF THE ASSESSEE THE ORDER OF THE CIT(A) SHALL BE IN WRITING AND SHALL S TATE THE POINTS FOR DETERMINATION THE DECISION THEREON AND RAISING FURTHER DECISION. IN THE LIGHT OF THE ABOVE FACTS AND CIRCUMSTANCES WE RESTORE THIS APPEAL TO THE FILE OF THE LD. CIT(A) FOR DECIDING A FRESH AFTER B Y PASSING A SPEAKING ORDER AFTER CONSIDERING THE RELEVANT DETAIL AND INFORMATION FUR NISHED BY THE ASSESSEE. THEREFORE, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTIC AL PURPOSE. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSE. SD/- SD/- (MAHAVIR PRASAD) (AMARJIT SINGH) JUDICIAL MEMBER ACCOUNT ANT MEMBER AHMEDABAD: DATED 16/09/2019 TANMAY TRUE COPY / COPY OF ORDER FORWARDED TO:- 1. / REVENUE 2. $ / ASSESSEE 3. &' ( / CONCERNED CIT 4. ( - / CIT (A) 5. )*+ ' , ! ' , ,-$&$ / DR, ITAT, AHMEDABAD 6. +. / / GUARD FILE. BY ORDER / $% , 0 / , ! ' , ,-$&$ 1 THIS ORDER PRONOUNCED IN OPEN COURT ON 16/09/2019