Shri Sanjaykumar Mansukhlal Shah, Bhavnagar V. The ACIT, Circle-1, Bhavnagar

ITA 2842/AHD/2017

• Counselvise Citation: [2022] 105 COUNSELVISE.COM (IT) 5575 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 year(s) 3 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-03-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2013-2014
• Appeal Filed On: 12-12-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V.K. SINGH
• Assessee Lawyers: P B PARMAR
• Keywords: Sale consideration of property below Jantri Value
• Section: 143(3); 2(14)

Judgement Text

, ‘C’ । IN THE INCOME TAX APPELLATE TRIBUNAL “C” BENCH, AHMEDABAD (Convened through Virtual Court) BEFORE SMT. ANNAPURNA GUPTA, ACCOUNTANT MEMEBR & SHRI MAHAVIR PRASAD, JUDICIAL MEMEBR आयकर अपील सं./I.T.A. No. 2842/Ahd/2017 ( Assess ment Ye ar : 2013-14) Sa nj ay ku ma r M a n su kh la l Sh ah 10 1, Sa rt hi k Co mp l ex, Ata bh ai C ho wk , Ta laj a Ro ad, B ha vn ag ar / V s . As sis ta nt C o mmi s s io ner of In co me T ax Cir cl e - 1 , 2 n d F lo o r, Aa ya k ar B ha va n, N r. Jas on at h Ch ow k Na ku bau g, B ha vn a gar यी ल सं./ ीआ आर सं./P A N / G IR N o . : A B T P S 4 8 3 5 R (अपील Appellant) . . ( य / Respondent) अपील र स /Appellant by : Sh ri P B Pa r mar , A .R. य क र स / Respondent by : Shri V. K. Singh, Sr.D.R. स क र D a t e o f H e a r i n g 24/03/2022 !"# क र /D a t e o f P r o n o u n c e m e n t 31/03/2022 ORDER PER MAHAVIR PRASAD, JM: The captioned ap peal has been filed at th e instan ce of the ass essee ag ainst th e ord er of the Co mmissioner of ITA No. 2842/Ahd/2017 (Sanjaykumar M. Shah vs. ACIT ) AY 2013-14 - 2 - Inco me Tax ( Ap peals)-6, Ah med abad (‘ CI T(A)’ in short) vide App eal No. CI T( A)-6/77/16-17, dated 26.10.2017 arising in th e as sess ment ord er d ated 28.03.2016 passed by the Ass essing Of ficer (AO) under s. 143(3) of the Inco me Tax Act, 1961 (the Act) con cerning AY. 2013-14. 2. The grounds of appeal r ais ed by the ass essee r ead as under: “ 1 . T h e l e a r n e d C I T ( A ) h a s e r r e d b o t h i n l a w a n d o n t h e f a c t s o f t h e c a s e i n c o n f i r m i n g t h e a c t i o n o f A O o f h o l d i n g t h a t t h e l a n d i s a c a p i t a l a s s e t w i t h i n t h e m e a n i n g o f s . 2 (14 ) o f t h e A c t a n d t h u s l i a b l e f o r c a p i t a l g a i n t a x . 2 . T h e l e a r n e d C I T ( A ) h a s e r r e d b o t h i n l a w a n d o n t h e f a c t s o f t h e c a s e h i t a k i n g a i d o f s . 2 ( 1 4 ) o f t h e A c t a s a m en d e d w . e . f . 0 1 . 0 4 . 2 0 1 4 w h i c h i s n o t a t a l l a p p l i c a b l e t o t h e c as e o f t h e a p p e l l a n t . 3 . T h e l e a r n e d C I T ( A ) h a s e r r e d b o t h i n l a w a n d o n t h e f a c t s o f t h e c a s e i n c o n f i r m i n g t h e a d d i t i o n o f R s . l 1 , 0 5 , 0 00 / - u / s . 5 0 C o f t h e A c t . 4 . T h e l e a r n e d C I T ( A ) h a s e r r e d b o t h i n l a w a n d o n t h e f a c t s o f t h e c a s e h i n o t a d j u d i c a t i n g g r o u n d c h a l l e n g i n g , a cc e p t a n c e o f D V O ' s v a l u a t i o n w i t h o u t a p p r e c i a t i n g t h e d i s t i n gu i s h i n g f e a t u r e s r e s p o n s i b l e f o r l e s s e r v a l u e a s s t a t e d i n t h e s a l e s d e e d . 5 . B o t h t h e l o w e r a u t h o r i t i e s h a v e p a s s e d t h e o r d er s w i t h o u t p r o p e r l y a p p r e c i a t i n g t h e f a c t s a n d t h e y f u r t h e r e rr e d i n g r o s s l y i g n o r i n g v a r i o u s s u b m i s s i o n s , e x p l a n a t i o n s a n d i n f o r m a t i o n s u b m i t t e d b y t h e a p p e l l a n t f r o m t u n e t o t i m e w h i c h o u g h t t o h a v e b e e n c o n s i d e r e d b e f o r e p a s s i n g t h e i m p u g n e d o r d e r . T h i s a c t i o n o f t h e l o w e r a u t h o r i t i es i s i n c l e a r b r e a c h o f l a w a n d P r i n c i p l e s o f N a t u r a l J u s t ic e a n d t h e r e f o r e d e s e r v e s t o b e q u a s h e d . 6 . T h e l e a r n e d C I T ( A ) h a s e r r e d i n l a w a n d o n f a c ts o f t h e c a s e i n c o n f i r m i n g a c t i o n o f t h e I d . A O i n l e v y i n g i n t e re s t u / s . 2 3 4 A / B / C o f t h e A c t . ITA No. 2842/Ahd/2017 (Sanjaykumar M. Shah vs. ACIT ) AY 2013-14 - 3 - 7 . T h e l e a r n e d C I T ( A ) h a s e r r e d i n l a w a n d o n f a ct s o f t h e c a s e i n c o n f i r m i n g a c t i o n o f t h e I d . A O i n i n i t i a t i n g p en a l t y u / s . 2 7 1 ( l ) ( c ) o f t h e A c t . ” 3. In this cas e, assessee sold a land and did not show an y gains fro m th e sale of same. When asked b y the AO, contention of the ass ess ee was that the land sold was agricultural land . But the AO did not agree with th e contention of th e ass ess ee and added Rs .11,05 ,000/- under S.50C of th e Act. 4. Ther eafter, ass es see filed appeal against th e order of the AO b efor e th e CIT( A) . The learned CI T(A) h eld th at as per the CBDT n otified such distance fro m lo cal limits o f municip ality vid e Gazette Notification No. [S O 9 447] (File No. 164/3/87 - ITA. I) d ated 6.1.1994. As per this notification, distance in r espect of Bh avnag ar municipality is notified as follows:- 7 . Bh a v n a g a r A r e a s u p t o a d i s t a n c e o f 8 K m s . f r o m t h e m u n i c i p a l l i m i t s i n a l l d i r e c t i o n s . Thus, land within area of 8 Kms from the municipal limits of Bhavn ag ar, is not consid ered 'agricultur al land ' for the purpose of Section 2(14) of the Act. Th e land sold by th e appellant is at a distance of only 5.2 k ms fro m Bh avnag ar . Ther e is no substan ce in th e contention of th e ass ess ee that population of village Budh el as per last census is o nly 7760, hence th e s econd condition in clause ( a) of Sectio n 2(14) of the Act is not satisfied. This contention is based on ITA No. 2842/Ahd/2017 (Sanjaykumar M. Shah vs. ACIT ) AY 2013-14 - 4 - misinterpr etation of the above p rovision. Hen ce, the land has b een rightly held to be non-ag ricultural land by the AO. In view of dis cussion above, CI T(A) held th at the AO was justified in making addition of Rs. 11,05,000/- u/s 50 C of the Act. Accordingly, addition of Rs. 11,05,000/- was upheld b y him. 5. On the oth er h and, learn ed DR h as relied o n the ass ess ment ord er. 6. We h ave gon e through the relevant r ecord and impugned order. The dispute bef ore us is whether sold land is a ‘capital ass et’ or ‘agricultural land’. In support of its contention , ass essee h as filed a judg ment of co-ordinate bench in th e cas e of ITO vs. Ak ash Deep Far ms P. Ltd . in ITA No.2138/Ahd/2012 & Anr. order dated 11.08.2015 wher ein it is h eld that: "CBDT CIRCULAR NO -17/2015, Dated: October 06, 2015 Subject:- Measurement of the distance for the purpose of section 2(14)(iii)(b) of the Income-tax Act for the period prior to Assessment year 2014-15 "Agricultural Land" is excluded from the definition of capital asset as per section 2(14)(iii) of the Income-tax Act based, inter-alia, on its proximity to a municipality or cantonment board. The method of measuring the distance of the said land from the municipality, has given rise to considerable litigation. Although, t h e a m e n d m e n t b y t h e F i n a n c e A c t , 2 0 1 3 w .e . f . 1 . 0 4 . 2 0 1 4 p r e s c r i b e s t h e m e a s u r e m e n t o f t h e d i s t a n c e t o b e t ak e n a e r i a l l y , a m b i g u i t y p e r s i s t s i n r e s p e c t o f e a r l i e r p e r i o d s . 2 . T h e m a t t e r h a s b e e n e x a m i n e d i n l i g h t o f j u d i c i al d e c i s i o n s o n t h e s u b j e c t . T h e N a g p u r B e n c h o f t h e H o n . B o m b a y H ig h C o u r t V i d e o r d e r d a t e d 3 0 . 0 3 . 2 0 1 5 i n I T A 1 5 1 o f 2 0 1 3 i n th e c a s e o f S m t . M a l t i b a i R K a d u h a s h e l d t h a t t h e a m e n d m e n t p r e s c r ib i n g d i s t a n c e ITA No. 2842/Ahd/2017 (Sanjaykumar M. Shah vs. ACIT ) AY 2013-14 - 5 - t o b e m e a s u r e d a e r i a l l y , a p p l i e s p r o s p e c t i v e l y i . e . i n r e l a t i o n t o a s s e s s m e n t y e a r 2 0 1 4 - 1 5 a n d s u b s e q u e n t a s s e s s m e n t ye a r . F o r t h e p e r i o d p r i o r t o a s s e s s m e n t y e a r 2 0 1 4 - 1 5 , t h e H i g h Co u r t h e l d t h a t t h e d i s t a n c e b e t w e e n t h e m u n i c i p a l l i m i t a n d t h e a gr i c u l t u r a l l a n d i s t o b e m e a s u r e d h a v i n g r e g a r d t o t h e s h o r t e s t r o ad d i s t a n c e . T h e s a i d d e c i s i o n o f t h e H i g h C o u r t h a s b e e n a c c e p t e d an d t h e a f o r e s a i d d i s p u t e d i s s u e h a s n o t b e e n f u r t h e r c o n t es t e d . 3 . B e i n g a s e t t l e d i s s u e , n o a p p e a l s m a y h e n c e f o r t h b e f i l e d o n t h i s g r o u n d b y t h e o f f i c e r s o f t h e D e p a r t m e n t a n d a p p e a ls a l r e a d y f i l e d , i f a n y , o n t h i s i s s u e b e f o r e v a r i o u s C o u r t s /T r i b u n a l s m a y b e w i t h d r a w n / n o t p r e s s e d u p o n . T h i s m a y b e b r o u g h t t o t h e n o t i c e o f a l l c o n c e r n e d . [ F . N o . 2 7 9 / M i s c . / 1 4 0 / 2 0 1 5 - I T J ] ( D S C h a u d h r y ) C I T ( A & J ) , C B D T " 6.1 Apart fro m the afores aid judg ment, learned AR also cited the order o f Jaipur Tribunal in cas e of Dinesh Ku mar Jain vs . I TO [ 2017] 78 tax mann.co m 53 (J aipur-Trib.), wher ein it is h eld as under: “ S e c t i o n 2 ( 1 4 ) o f t h e I n c o m e - t a x A c t , 1 9 6 1 - C a p i t al g a i n s - C a p i t a l a s s e t ( A g r i c u l t u r a l l a n d ) - A s s e s s m e n t y e a r 2 0 1 1 - 1 2 - W h e t h e r a m e n d m e n t t o s e c t i o n 2 ( 1 4 ) b y Fi n a n c e A c t , 2 0 1 3 c a n n o t a p p l y t o a s s e s s m e n t y e a r 2 0 1 1 - 1 2 - H e l d , y e s - W h e t h e r f o r y e a r u n d e r c o n s i d e r a t i o n , d i s t a n c e o f a g r i c u l t ur a l l a n d f r o m n e a r e s t mu n i c i p a l i t y w a s t o b e m e a s u r e d b y a p pr o a c h r o a d ; s a m e c o u l d n o t b e m e a s u r e d a e r i a l l y a s p e r a me n d m e n t b r o u g h t t o s e c t i o n 2 ( 1 4 ) b y Fi n a n c e A c t , 2 0 1 3 - H e ld , y e s [ P a r a s 6 . 8 a n d 6 . 1 0 ] [ M a t t e r r e m a n d e d ] ” 6.2 After h earing both the, we ar e of the confir med view that distan ce cannot be measur ed on the b asis of Goggle Map . As in the present case, learned AO h as measured th e distance with th e h elp of Goggle Map, ther efor e, we s et asid e this matter to the file of the AO to measure th e distance of the land from th e outer limit of Bhavn agar Municip ality without political / jurisdictional ma p as in th e ITA No. 2842/Ahd/2017 (Sanjaykumar M. Shah vs. ACIT ) AY 2013-14 - 6 - relevant ass ess ment year when assess ee claimed benefit of agricultural land . Th er eafter, AO shall decid e th e matter as per law. 7. In the result, appeal filed b y th e Assess ee is allo wed for statistical purposes. Sd/- Sd/- (ANNAPURNA GUPTA) (MAHAVIR PRASAD) ACCOUNTANT MEMB ER JUDICIAL MEMBER Ahmedabad: Dated 31/03/2022 True Copy S.K.SINHA ेश ! " #े" / Copy of Order Forwarded to:- $. र / Revenue 2. आ दक / Assessee '. सं(ं)* आयकर आय + / Concerned CIT 4. आयकर आय + - अपील / CIT (A) .. / 0 1ीय 2 2 )*3 आयकर अपील य अ)*कर#3 अ45द ( द / DR, ITAT, Ahmedabad 6. 1 78 9 ल / Guard file. By order/आद श स 3 उप/स4 यक पं ीक र आयकर अपील य अ)*कर#3 अ45द ( द । This Order pronounced in Open Court on 31/03/2022