Esther Jasper, CHENNAI V. ITO Non Corp. Ward 1(5), CHENNAI

ITA 2883/CHNY/2017

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 5052 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 6 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-05-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 21-03-2019
• Assessment Year: 2009-2010
• Appeal Filed On: 28-11-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: S BHARATH
• Assessee Lawyers: T BANUSEKAR
• Keywords: Capital asset; Principle of natural justice; Assessment record
• Section: 143(3); 54F; 133(6); 148; 263; 2

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL , A BENCH, CHENNAI . , . , BEFORE SHRI A.MOHAN ALANKAMONY, ACCOUNTANT MEMBER AND SHRI DUVVURU RL REDDY, JUDICIAL MEMBER ./ I.T.A.NO.2883 & 2884/CHNY/2017, 2040 & 2041/CHNY/2018 / ASSESSMENT YEARS: 2009-10 & 2010-11) SMT. ESTHER JASPER, NEW NO.52, OLD NO.30, 3 RD MAIN ROAD, R.A. PURAM, CHENNAI 600 028. VS THE INCOME TAX OFFICER, NON CORPORATE WARD 1(5), CHENNAI. PAN: AGEPS4809F ( /APPELLANT) ( /RESPONDENT) & ./ I.T.A.NO.3132/CHNY/2017 / ASSESSMENT YEAR: 2010-11) THE INCOME TAX OFFICER, NON CORPORATE WARD 1(5), CHENNAI. VS SMT. ESTHER JASPER, NEW NO.52, OLD NO.30, 3 RD MAIN ROAD, R.A. PURAM, CHENNAI 600 028. PAN: AGEPS4809F ( /APPELLANT) ( /RESPONDENT) /ASSESSEE BY : SHRI T. BANUSEKAR, CA /REVENUE BY : SHRI S. BHARATH, JCIT /DATE OF HEARING : 10.04.2019 /DATE OF PRONOUNCEMENT : 30.05.2019 / O R D E R PER A. MOHAN ALANKAMONY, AM:- THESE APPEALS BY THE ASSESSEE ARE DIRECTED AGAINST THE COMMON ORDER PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-13, DATED 29.09.2017 IN ITA NO.18 & 19/CIT(A)-2/2016-17 FOR THE ASSESSMENT YEARS 2009-10 & 2010-11 PASSED U/S.250(6) 2 ITA NOS.2883, 2884 & 3132/CHNY/2017 & ITA NOS.2040 & 2041/CHNY/2018 R.W.S. 143(3) R.W.S. 147 OF THE ACT. THE REVENUE HAS ALSO RAISED AN APPEAL AGAINST THE ORDER OF THE LD.CIT(A) FOR THE ASSESSMENT YEAR 2010-11. THE OTHER TWO APPEALS ARE FILED BY THE ASSESSEE AGAINST THE ORDER PASSED BY THE LEARNED PRINCIPAL COMMISSIONER OF INCOME TAX, CHENNAI BOTH DATED 21.03.2018 U/S.263 OF THE ACT AGAINST THE ORDER PASSED BY THE LD.AO DATED 17.03.2016 & 28.03.2016 IN C.NO.218/9/PCIT/2017-18 & C.NO.218/10/PCIT-1/2017-18 FOR THE ASSESSMENT YEARS 2009-10 & 2010-11 RESPECTIVELY. 2. ASSESSEES APPEAL IN ITA NOS. 2883 & 2884/CHNY/2017 FOR THE ASSESSMENT YEARS 2009-10 & 2010-11:- THE ASSESSEE HAS RAISED SEVERAL IDENTICAL GROUNDS FOR BOTH THE ASSESSMENT YEARS 2009-10 & 2010-11 HOWEVER THE CRUXES OF THE ISSUES ARE THAT I. THE LD.CIT(A) HAS ERRED IN CONFIRMING THE ORDER OF THE LD.AO WITH RESPECT TO REOPENING OF THE ASSESSMENT U/S.147 / 148 OF THE ACT. II. THE LD.CIT(A) HAS CONFIRMED THE ORDER OF THE LD.AO FOR TREATING THE LAND SOLD BY THE ASSESSEE AS NON-AGRICULTURAL 3 ITA NOS.2883, 2884 & 3132/CHNY/2017 & ITA NOS.2040 & 2041/CHNY/2018 LAND AND THEREBY ASSESSED THE LONG TERM CAPITAL GAIN IN THE HANDS OF THE ASSESSEE. III. FOR THE ASSESSMENT YEAR 2010-11, THE ASSESSEE HAS RAISED AN ADDITIONAL GROUND AGGRIEVED BY THE ORDER OF LD.CIT(A) FOR HAVING CONFIRMED THE ORDER OF THE LD.AO WHO HAD ONLY PARTLY ALLOWED THE CLAIM OF DEDUCTION U/S.54F OF THE ACT. 3. REVENUES APPEAL IN ITA NO.3132/CHNY/2017, ASSESSMENT YEAR 2010-11 :- THE REVENUE HAS RAISED SEVERAL GROUNDS IN ITS APPEAL HOWEVER THE CRUX OF THE ISSUE IS THAT THE LD.CIT(A) HAS ERRED IN TREATING THE SALE CONSIDERATION IN RESPECT OF LAND SOLD DURING THE FINANCIAL YEAR 2009-10 AT RS.95 LAKHS AS AGAINST RS.148 LAKHS RECEIVED BY THE POWER OF ATTORNEY HOLDER ON BEHALF OF THE ASSESSEE. 4. ASSESSEES APPEAL IN ITA NOS. 2040 & 2041/CHNY/2018, ASSESSMENT YEAR 2009-10 & 2010-11:- THE ASSESSEE HAS RAISED SEVERAL IDENTICAL GROUNDS FOR BOTH THE ASSESSMENT YEARS 2009-10 & 2010-11 AGAINST THE ORDERS OF THE LD.PCIT U/S.263 OF THE ACT AND THE SAME IS EXTRACTED HEREIN BELOW FOR REFERENCE:- 4 ITA NOS.2883, 2884 & 3132/CHNY/2017 & ITA NOS.2040 & 2041/CHNY/2018 1. FOR THAT THE ORDER OF THE COMMISSIONER OF INCOME TAX IS WITHOUT JURISDICTION, CONTRARY TO LAW, FACTS AND CIRCUMSTANCES OF THE CASE AND AT ANY RATE IS OPPOSED TO THE PRINCIPLES OF EQUITY, NATURAL JUSTICE AND FAIR PLAY. 2. FOR THAT THE COMMISSIONER OF INCOME TAX DOES NOT HAVE JURISDICTION TO INVOKE THE PROVISIONS OF SECTION 263 SINCE THE ASSESSMENT ORDER HAS ALREADY MERGED WITH THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) 3. FOR THAT WITHOUT PREJUDICE TO THE ABOVE, THE COMMISSIONER OF INCOME TAX FAILED TO APPRECIATE THAT THERE WAS NO ERROR OR PREJUDICE MUCH LESS BOTH TO WARRANT THE INVOCATION OF THE POWERS CONFERRED UNDER SECTION 263. 4. FOR THAT WITHOUT PREJUDICE TO THE ABOVE, THE COMMISSIONER OF INCOME TAX FAILED TO APPRECIATE THAT THE ASSESSING OFFICER HAS APPLIED HIS MIND IN ALLOWING EXEMPTION UNDER SECTION 54F 5. FOR THAT THE COMMISSIONER OF INCOME TAX FAILED TO APPRECIATE THAT THE APPELLANT HAD FULFILLED ALL THE CONDITIONS FOR CLAIMING EXEMPTION U/S.54F 6. FOR THAT THE COMMISSIONER OF INCOME TAX FAILED TO APPRECIATE THAT THE DEMOLITION OF THE RESIDENTIAL HOUSE PURCHASED' WILL NOT AMOUNT TO TRANSFER OF THE SAID PROPERTY AS PER SECTION 2(47). 7. FOR THAT THE COMMISSIONER OF INCOME TAX FAILED TO APPRECIATE THAT FOR INVOKING THE PROVISIONS OF SECTION 54F(3) THE NEW ASSET SHOULD HAVE BEEN TRANSFERRED AND NOT WHEN THE SAME IS DEMOLISHED AND RECONSTRUCTED. 8. FOR THAT THE COMMISSIONER OF INCOME TAX FAILED TO APPRECIATE THAT THE ADDITIONAL INVESTMENT OF RS.1.5 CRORES MADE TO SECURE RELEASE OF RIGHT OVER PROPERTY PURCHASED WOULD CONSTITUTE COST OF THE SAID PROPERTY PURCHASED FOR THE PURPOSE OF CLAIMING EXEMPTION U/S.54F. 5. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS AN INDIVIDUAL FILED HER RETURN OF INCOME FOR THE ASSESSMENT YEARS 2009- 10 & 2010-11 ON 30.07.2009 & 22.07.2010 ADMITTING TOTAL INCOME OF 5 ITA NOS.2883, 2884 & 3132/CHNY/2017 & ITA NOS.2040 & 2041/CHNY/2018 RS.2,11,400/- & RS.2,66,470/- RESPECTIVELY. SUBSEQUENTLY THE CASE WAS REOPENED U/S.147 OF THE ACT VIDE NOTICE U/S.148 OF THE ACT ISSUED ON 10.03.2015 & 18.02.2015 FOR THE ASSESSMENT YEARS 2009- 10 & 2010-11 RESPECTIVELY. IN RESPONSE THE ASSESSEE REQUESTED THE RETURN FILED BY THE ASSESSEE ON 30.07.2009 AS THE RETURN FILED IN RESPONSE TO THE NOTICE U/S.148 OF THE ACT FOR THE ASSESSMENT YEAR 2009-10 HOWEVER FOR THE ASSESSMENT YEAR 2010-11, THE ASSESSEE FILED RETURN OF INCOME AFRESH ON 11.03.2015. 6. DURING THE COURSE OF SCRUTINY ASSESSMENT PROCEEDINGS FOR THE ASSESSMENT YEAR 2009-10, IT WAS OBSERVED BY THE LD.AO THAT THE ASSESSEE HAD SOLD 14 ACRES OF LAND OUT OF HER 78.052 ACRE OF LAND IN SURVEY NO.15/2A2A1BA (COMPRISED IN PATTA NO.65) SITUATED IN KOMMAKADU VILLAGE, YERCAUD TALUK, SALEM DIST., ON 23.05.2008 TO M/S. MEENAKSHI NARAYANAN RESIDING AT NEW NO.507, FOURTH SOUTH MAIN ROAD, KAPALEESWAR NAGAR, NEELANGARAI FOR SALE CONSIDERATION OF RS.7,35,00,000/- WHICH WORKS OUT TO RS.52,50,000/- PER ACRE. IT WAS ALSO REVEALED THAT THE PURCHASER OF THE LAND IS AN INVESTING COMPANY AND HAS PURCHASED THE LAND FOR OTHER THAN AGRICULTURE PURPOSE. IT WAS ALSO OBSERVED THAT NO AGRICULTURAL ACTIVITY HAD TAKEN 6 ITA NOS.2883, 2884 & 3132/CHNY/2017 & ITA NOS.2040 & 2041/CHNY/2018 PLACE IN THE LAND FROM THE YEAR 2007 AS PER THE ADANGAL RECEIVED FROM THE TAHSILDAR, YERCAUD TALUK. THE ASSESSEE HAD ALSO NOT OFFERED ANY AGRICULTURAL INCOME IN HER RETURN OF INCOME. THE ASSESSEE HAS ALSO NOT CARRIED OUT ANY AGRICULTURAL OPERATION IN HER ENTIRE STRETCH OF LAND. THE LD.AO ON FURTHER VERIFYING THE RECORDS FROM THE REVENUE DEPARTMENT OPINED THAT THE LAND BEARING SURVEY NO.15/2A2A1B1 WAS CLASSIFIED AS RESIDENTIAL AREA. FROM THE GOOGLE MAP, IT WAS REVEALED THAT THE LAND SOLD BY THE ASSESSEE WAS LOCATED AT A DISTANCE OF 3.3 KMS., FROM YERCAUD. FROM THE ABOVE FACTS, THE LD.AO CAME TO THE CONCLUSION THAT THE LAND SOLD BY THE ASSESSEE DOES NOT FALL IN THE EXEMPT CATEGORY OF AGRICULTURAL LAND AS SPECIFIED U/S.2(14)(III) OF THE ACT AND THEREFORE HELD IT TO BE CAPITAL ASSET SALE OF WHICH WOULD ATTRACT CAPITAL GAIN TAX. WHEN THE ASSESSEE WAS CONFRONTED WITH THE ABOVE FACTS, THE LD.AR FOR THE ASSESSEE CONTESTED BEFORE THE LD.AO, NOTWITHSTANDING THE CLAIM OF AGRICULTURAL LAND, FOR GRANTING DEDUCTION U/S.54F OF THE ACT, AS THE ASSESSEE HAD INVESTED THE ENTIRE SALE CONSIDERATION TOWARDS PURCHASE OF A RESIDENTIAL HOUSE PROPERTY AGGREGATING TO RS.6,40,50,160/- AND FURTHER INCURRED EXPENDITURE TOWARDS RECONSTRUCTION OF RESIDENTIAL HOUSE IN THE LAND PURCHASED. AS THE ASSESSEE WAS ELIGIBLE FOR THE 7 ITA NOS.2883, 2884 & 3132/CHNY/2017 & ITA NOS.2040 & 2041/CHNY/2018 CLAIM OF DEDUCTION U/S.54 OF THE ACT, THE LD.AO GRANTED THE SAME AND COMPUTED THE LONG TERM CAPITAL GAIN OF THE ASSESSEE AS NIL. SIMILARLY DURING THE ASSESSMENT YEAR 2010-11, THE ASSESSEE HAD SOLD ANOTHER EXTENT OF LAND BEARING THE SAME SURVEY NUMBER AND PATTA NUMBER TO VARIOUS PERSONS THROUGH HER POWER AGENT SMT. E.T. MOHANA FOR AN AGGREGATE SALE CONSIDERATION OF RS.1,48,36,510/-. HOWEVER THE LD. ASSESSING OFFICER OBSERVED THAT THE ASSESSEE HAD DECLARED THE SALE CONSIDERATION ONLY FOR RS.95,00,000/-. THEREFORE THE LD.AO KEEPING INTO CONSIDERATION OF THE ACTUAL SALE CONSIDERATION ADOPTED THE AMOUNT OF RS.1,48,36,510/- AS THE SALE AMOUNT FOR COMPUTING THE LONG TERM CAPITAL GAIN. FURTHER SINCE THE ASSESSEE HAS CLAIMED RS.1,42,85,500/- AS EXPENSES INCURRED TOWARDS RECONSTRUCTION OF HER RESIDENTIAL HOUSE IN THE RESIDENTIAL PROPERTY PURCHASED BY HER WHICH WAS SUPPORTED BY VALUATION CERTIFICATE, THE LD.AO GRANTED DEDUCTION OF RS.48,35,660/- U/S.54F OF THE ACT BY THE FOLLOWING COMPUTATION:- A) SALE CONSIDERATION RECEIVED ON THE EARLIER ASSESSMENT YEAR 2009-10 RS.6,40,50,160/- B) CONSTRUCTION EXPENDITURE INCURRED IN THE EARLIER ASSESSMENT YEAR 2009-10 - RS. 94,49,840/- ============= TOTAL RS.7,35,00,000/- ============ 8 ITA NOS.2883, 2884 & 3132/CHNY/2017 & ITA NOS.2040 & 2041/CHNY/2018 A) SALE CONSIDERATION RECEIVED ON THE EARLIER ASSESSMENT YEAR 2009-10 RS.6,40,50,160/- B) CONSTRUCTION EXPENDITURE INCURRED IN THE ASSESSMENT YEAR 2010-11 RS.1,42,85,500/- ============= TOTAL RS.7,83,35,660/- C) LESS AMOUNT OF DEDUCTION U/S.54F OF THE ACT GRANTED IN THE EARLIER YEAR RS.7,35,00,000/- ============ D) DEDUCTION U/S.54F GRANTED FOR THE ASSESSMENT YEAR 2010-11 RS. 48,35,660/- 7. AGGRIEVED BY THE ORDER OF THE LD.AO FOR BOTH THE ASSESSMENT YEARS 2009-10 & 2010-11, THE ASSESSEE CARRIED THE MATTER BEFORE THE LD.CIT(A). ON MERITS WITH RESPECT TO THE CLAIM OF AGRICULTURAL LAND, THE LD.CIT(A) OBSERVED AS FOLLOWS:- I. THE CHITTA ADANGAL FILED BEFORE THE LD.AO AVAILABLE IN THE ASSESSMENT RECORDS FOR THE ASSESSMENT YEAR 2010-11 REVEALED THAT IN SURVEY NO.15/27, 15/2A2A1B1 FOR FASALI YEAR 1425, NO CROPS WAS MENTIONED. II. THE VILLAGE OFFICERS REMARK IN THE CHITTA AND ADANGAL IS THAT THERE IS BUILDING EXISTING ON THE LAND. III. THE ASSESSEE WAS CHANGING HER STAND FROM AGRICULTURAL LAND TO NON-AGRICULTURAL AND VENTURED INTO CLAIMING DEDUCTION U/S.54F OF THE ACT. 9 ITA NOS.2883, 2884 & 3132/CHNY/2017 & ITA NOS.2040 & 2041/CHNY/2018 WITH THE ABOVE OBSERVATION, THE LD.CIT(A) CONCURRED WITH THE VIEW OF THE LD.AO AND HELD THAT THE LAND SOLD BY THE ASSESSEE IN BOTH THE ASSESSMENT YEARS IS NON-AGRICULTURAL LAND EXIGIBLE FOR LONG TERM CAPITAL GAIN TAX. 8. BEFORE US THE LD.AR VEHEMENTLY ARGUED STATING THAT THE LAND SOLD BY THE ASSESSEE IS AGRICULTURAL LAND. HE FURTHER ARGUED BY STATING THAT THE ASSESSEE HAD A LARGE EXTENT OF LAND TO THE TUNE OF APROX. 78 ACRES BEARING SURVEY NO.15/2A2A1BA COMPRISED IN PATTA NO.65 SITUATED IN KOMMAKADU VILLAGE, YERCAUD TALUK. HE FURTHER REFERRED TO THE PAPERBOOK PAGE NO.31 TO 33 REGARDING THE LETTER ADDRESSED BY THE TAHSILDAR, YERCAUD TO THE INCOME TAX OFFICER VIZ., LETTER NO. CA NO.1947/2015 (B) DATED 14.09.2015 ALONG WITH THE ENGLISH TRANSLATION, WHEREIN IT IS STATED THAT IN THE LAND BEARING SURVEY NO. 15/2A2A1B PATTA NO. 65 FOR THE FASALI YEARS 1416 AND 1417 IT HAS BEEN RECORDED THAT CROPS SUCH AS COFFEE, ORANGE, GUAVA, JACKFRUIT AND LEMON WERE PLANTED ON THE LAND, WHICH PROVES THAT THE LAND IS AGRICULTURAL LAND. THE LD.AR FURTHER ARGUED STATING THAT THE LD.REVENUE AUTHORITIES MIGHT HAVE ARRIVED AT SUCH ERRONEOUS 10 ITA NOS.2883, 2884 & 3132/CHNY/2017 & ITA NOS.2040 & 2041/CHNY/2018 DECISION BASED ON THE INFORMATION GATHERED FROM THE LAND REGISTRATION DEPARTMENT THAT THE LAND WAS CLASSIFIED AS RESIDENTIAL CLASS V TYPE I FOR THE PURPOSE OF STAMP DUTY WHICH IS IRRELEVANT FOR THE PURPOSE INCOME TAX WHILE AS CLASSIFICATION OF THE BY THE LAND REVENUE DEPARTMENT IS RELEVANT FOR THE PURPOSE OF INCOME TAX. THE LD.AR FURTHER SUBMITTED BEFORE US THAT THE ASSESSEE HAD CULTIVATED VARIOUS CROPS SUCH AS ORANGE, GUAVA, JACKFRUIT AND LEMON TREES IN THE LAND AND THAT HAS BEEN ESTABLISHED FROM THE CERTIFICATE ISSUED BY THE THASILDAR. IT WAS FURTHER ARGUED THAT THE LAND WAS INHERITED BY THE ASSESSEE FROM HER FATHER AND THE LAND WAS CONSISTENTLY USED FOR AGRICULTURAL PURPOSE. THE LD.AR FURTHER EXPLAINED THAT THE LAND WAS LOCATED IN ERSTWHILE YERCAUD TALUK BUT NOW CLASSIFIED UNDER THE PANCHAYAT UNION COMPRISING OF 9 REVENUE VILLAGES AND 67 HAMLETS AND THE POPULATION OF THE ERSTWHILE YERCAUD TALUK WAS ONLY 39,080. THE LD.AR FURTHER VEHEMENTLY ARGUED THAT IN THE SALE DEED ALSO, THE LAND WAS STATED AS AGRICULTURAL LAND WHICH WAS ACCEPTED BY THE REGISTRATION DEPARTMENT. THE LD.AR FURTHER SUBMITTED THAT THE LETTER FROM THE TAHSILDAR CERTIFYING, THE LAND TO BE AGRICULTURAL LAND WHEREIN AGRICULTURAL OPERATIONS WERE BEING CARRIED OUT, WAS OBTAINED BY THE LD.AO HIMSELF WHICH HE HAS SIMPLY REJECTED. THE LD.AR FURTHER 11 ITA NOS.2883, 2884 & 3132/CHNY/2017 & ITA NOS.2040 & 2041/CHNY/2018 REFERRED TO THE P.B STATING THAT NOTICE U/S.17 OF THE WEALTH TAX ACT WAS ISSUED TO THE ASSESSEE FOR REOPENING HER ASSESSMENT FOR THE ASSESSMENT YEAR 2009-10 WITH RESPECT TO THE LAND HELD BY HER AND IN RESPONSE THE ASSESSEE HAD REPLIED WITH PARTICULARS MENTIONING THAT THE LAND HELD BY HER IS AGRICULTURAL LAND AND THEREFORE NOT ASSESSABLE FOR WEALTH TAX. THEREAFTER NOTHING WAS HEARD FROM THE DEPARTMENT WHICH IMPLIES THAT THE WEALTH TAX ASSESSMENT WAS DROPPED. IT WAS THEREFORE PLEADED THAT THE LAND MAY BE TREATED AS AGRICULTURAL LAND AND THE LEVY OF LONG TERM CAPITAL GAIN TAX MAY BE DELETED. THE LD.DR ON THE OTHER HAND VEHEMENTLY ARGUED IN SUPPORT OF THE ORDER OF THE LD.REVENUE AUTHORITIES. 9. WE HAVE HEARD THE RIVAL SUBMISSIONS AND CAREFULLY PERUSED THE MATERIALS ON RECORD. FROM THE FACTS OF THE CASE IT IS OBVIOUS THAT THE ASSESSEE HAS INHERITED THE ENTIRE EXTENT OF 78.052 ACRES OF LAND FROM HER PARENTS. IT IS ALSO EVIDENT THAT THE LAND IS SITUATED IN KOMMAKADU VILLAGE, YERCAUD TALUK. NORMALLY SUCH LARGE EXTENT OF LAND IN SUCH LOCATION IS AGRICULTURAL LAND. MOREOVER THE LD.AO HIMSELF HAS OBTAINED THE LETTER FROM THE TAHSILDAR; CA NO.1947/2015(B) DATED 14.09.2015 WHEREIN IT IS STATED THAT THE LAND 12 ITA NOS.2883, 2884 & 3132/CHNY/2017 & ITA NOS.2040 & 2041/CHNY/2018 IN SURVEY NO.15/2A2A1B SITUATED AT KOMMAKADU VILLAGE COMPRISED IN PATTA NO.65, AGRICULTURAL OPERATIONS WAS CARRIED OUT AND THE SAME IS PLACED ON RECORD IN THE PAPER BOOK FILED BY THE LD.DR AT PAGE NO.55,56,56(A) ALONG WITH ENGLISH TRANSLATION AND THE ASSESSEES PAPER BOOK PAGE NO.31 TO 33 ALONG WITH THE ENGLISH TRANSLATION FILED BEFORE THE TRIBUNAL BY THE LD.AR ON 20 TH JULY, 2018. FOR REFERENCE THE ENGLISH TRANSLATION OF THE LETTER FROM THE THASILDAR IS EXTRACTED HEREIN BELOW FOR REFERENCE:- ENGLISH TRANSLATION OF PAGE NOS. 31 AND 32 FROM MR. M. KRISHNAN TAHSILDAR, YERCAUD TO THE INCOME TAX OFFICER DOOR NO. 304, THIRD FLOOR, VANAPADI BLOCK, 121, NUNGAMBAKKAM MAIN ROAD, CHENNAI600034 CA NO. 1947/2015 (B), DATED 14.09.2015 SIR, SUB: INFORMATION - REGARDING INFORMATION SOUGHT UNDER SECTION 133(6) OF THE INCOME TAX ACT 1961, ABOUT MRS. JASPER ESTHER, RESIDING AT DOOR NO. 30, NEW DOOR NO. 52, RA PURAM, CHENNAI - REG. INFORMATION: LETTER FROM YOUR OFFICE, NUMBERED PAN AABPE6028P/NCWJ (5), 2014-2015, DATED 22.07.2015 ********** WITH REFERENCE TO THE INFORMATION SOUGHT FOR ABOUT MRS. JASPER ESTHER, RESIDING AT DOOR NO. 30, NEW DOOR NO. 52, RA PURAM, CHENNAI, UNDER SECTION 133(6) OF THE INCOME TAX ACT 1961, PLEASE FIND MY REPORT AS GIVEN BELOW: 13 ITA NOS.2883, 2884 & 3132/CHNY/2017 & ITA NOS.2040 & 2041/CHNY/2018 1. KOMMAKADU VILLAGE OF YERCAUD TALUK, SALEM DISTRICT WHICH IS CURRENTLY UNDER THE ADMINISTRATIVE CONTROL OF YERCAUD TALUK, HAS BEEN CLASSIFIED AS A VILLAGE. PRIOR TO THE YEAR 2000, THE YERCAUD TALUK WAS A TOWN PANCHAYAT. THE YERCAUD TALUK HAS NOW BEEN CLASSIFIED AS PANCHAYAT UNION COMPRISING OF 9 REVENUE VILLAGES AND 67 HAMLETS. THE POPULATION OF THE ERSTWHILE YERCAUD TALUK WAS 39,080. 2. KOMMAKADU VILLAGE IN YERCAUD TALUK IS LOCATED ADJACENT TO THE YERCAUD TOWN VILLAGE. 3. THE TOTAL AREA OF LAND BEARING SURVEY NO. 15/2A2A1B, SITUATED AT KOMMAKADU VILLAGE IS 31.79.5 HECTARES AND AS PER PATTA NO. 65 IT IS JOINTLY HELD BY MATHEWS (1), S. ESTHER GNANAMBAL (2) AND KANNAYYA (3). THE ABOVE REFERRED LAND, VIDE TALUK OFFICE RECORD NO. 8A/17/1418, DATED 01.08.2008 WAS SUBDIVIDED AND REGISTERED AS PATTA NOS. 65, 190 AND 191. 4. IN THE VILLAGE ACCOUNTS NO.2 ADANGAL RECORD FOR THE FASALI YEARS 1416 AND 1417 PERTAINING TO LAND BEARING SURVEY NO.15/2A2A1B1 SITUATED AT KOMMAKADU VILLAGE, IT HAS BEEN RECORDED THAT CROPS VIZ., COFFEE, ORANGE, GUAVA, JACKFRUIT AND LEMON WERE PLANTED. SUBSEQUENTLY, IN THE RECORDS PERTAINING TO FASALI YEARS 1418,1419,1420 NOTINGS ABOUT CULTIVATION OF THE SAID CROPS HAVE NOT BEEN MADE. I WOULD ALSO LIKE TO STATE THAT VILLAGE ACCOUNTS, PHOTOCOPY OF 'A' REGISTER, PHOTOCOPY OF CHITTA, ADANGAL PERTAINING TO SURVEY NO. 15/2A2A1B1 ARE ENCLOSED WITH THIS LETTER. ATTACHMENTS: AS LISTED ABOVE SD./- M. KRISHNAN TAHSILDAR, YERCAUD DATED 14.09.2015 WHEN THE FACT BEING SO YET THE LD. DR HAS ARGUED BEFORE US BY STATING THAT THE LAND IN QUESTION IS NOT AGRICULTURAL LAND HOWEVER, HE 14 ITA NOS.2883, 2884 & 3132/CHNY/2017 & ITA NOS.2040 & 2041/CHNY/2018 HAS NOT PRODUCED ANY EVIDENCE TO COUNTER THE CERTIFICATE ISSUED BY THE TAHSILDAR ENCLOSED IN THE PAPER BOOKS. THE REVENUE HAS ALSO NOT ESTABLISHED THAT THE LAND IS SITUATED OUTSIDE THE LIMITS PRESCRIBED IN U/S. 2(14)(III) OF THE ACT IN ORDER TO CLASSIFY THE LAND AS CAPITAL ASSET NOT FALLING IN THE EXEMPT CATEGORY. THE OBSERVATION OF THE LD.AO THAT AS PER THE ADANGAL RECEIVED FROM THE TAHSILDAR, YERCAUD TALUK, THERE WAS NO AGRICULTURAL ACTIVITY IN THE LAND DOES NOT HOLD ANY WATER BECAUSE IT WAS NOT SUBSTANTIATED WITH ANY EVIDENCE WHILE AS THE LETTER FROM THE TAHSILDAR SUBMITTED BY THE ASSESSEE STATES THAT AGRICULTURAL ACTIVITY WAS CARRIED OUT IN THE LAND DURING THE PAST. IT IS PERTINENT TO MENTION THAT, THE LAND IN QUESTION SHOULD BE AGRICULTURAL LAND AND IT IS NOT MANDATORY THAT DURING THE RELEVANT ASSESSMENT YEAR AGRICULTURAL OPERATIONS TO BE CARRIED OUT FOR THE LAND TO FALL IN THE EXEMPT CATEGORY U/S.2(14) OF THE ACT. THE OBSERVATION BY THE LD.AO THAT THE GOOGLE MAP REVEALED THE LAND SOLD BY THE ASSESSEE IS LOCATED AT THE DISTANCE OF 3.3 KMS FROM YERCAUD IS ALSO OF NO RELEVANCE BECAUSE NOTHING IS PRODUCED BEFORE US TO ESTABLISH THAT THE LAND IS SITUATED OUTSIDE THE LIMITS STIPULATED U/S.2(14)(III) OF THE ACT TO HOLD THE LAND HELD BY THE ASSESSEE AS CAPITAL ASSET EXIGIBLE FOR CAPITAL GAIN TAX. THE LD.REVENUE AUTHORITIES CONTENTION THAT THE 15 ITA NOS.2883, 2884 & 3132/CHNY/2017 & ITA NOS.2040 & 2041/CHNY/2018 ASSESSEE HAS BEEN CHANGING HER STAND ALSO DOES NOT HAVE ANY MERIT BECAUSE WHEN THE LD.REVENUE AUTHORITIES OPINED THAT THE LAND IS NON-AGRICULTURAL LAND, THE ASSESSEE HAD NO OTHER OPTION BUT TO CLAIM DEDUCTION U/S.54F OF THE ACT, AS SHE HAD INVESTED THE SALE CONSIDERATION IN RESIDENTIAL HOUSE PROPERTY. FURTHER FROM THE PAPER BOOK SUBMITTED BEFORE US, WE FIND THAT THERE WERE CORRESPONDENCE BETWEEN THE ASSESSEE AND THE WEALTH TAX OFFICER REGARDING THE ASSESSMENT OF HER WEALTH TAX; HOWEVER IT APPEARS THAT NO WEALTH WAS ASSESSED IN THE HANDS OF THE ASSESSEE. THE CLAIM OF THE ASSESSEE IS THAT THERE WAS NO RESPONSE FROM THE WEALTH TAX OFFICER SUBSEQUENT TO SUCH CORRESPONDENCE AND NO WEALTH TAX ASSESSMENT IS MADE WHICH ESTABLISHES THE FACT THAT THE WEALTH TAX OFFICER HAD ACCEPTED THE CONTENTION OF THE ASSESSEE THAT THE LAND HELD BY THE ASSESSEE IS AGRICULTURAL LAND. MOREOVER WITH RESPECT TO THE WEALTH TAX ASSESSMENT OF THE ASSESSEE THE LD.DR COULD NOT PRODUCE ANY EVIDENCE TO NEGATE THE SUBMISSION OF THE LD.AR. FURTHER FROM THE PAPER BOOK SUBMITTED BY THE LD.DR, WE FIND THAT THE LETTER FROM THE TAHSILDAR, YERCAUD DATED 14.09.2015 IS ENCLOSED IN THE PAPER BOOK, WHEREIN IT IS STATED THAT THE LAND OWNED BY THE ASSESSEE IS AGRICULTURAL LAND AND AGRICULTURAL OPERATIONS WERE CARRIED OUT IN THE 16 ITA NOS.2883, 2884 & 3132/CHNY/2017 & ITA NOS.2040 & 2041/CHNY/2018 LAND, WHICH SHOWS THAT THE REVENUE IS SEIZED OF THE MATTER AND HAS NOT CONFRONTED WITH THE SAME. MOREOVER IT IS NOT THE CASE OF THE REVENUE THAT THE ASSESSEE HAD CONVERTED THE LAND INTO RESIDENTIAL PLOTS. FURTHER THE MANNER IN WHICH THE PURCHASER HAD DEALT WITH THE LAND IS OF NO RELEVANCE TO THE CASE OF THE ASSESSEE. IN THIS SITUATION, CONSIDERING THE FACTS AND CIRCUMSTANCE OF THE CASE WE DO NOT HAVE ANY OTHER OPTION BUT TO ACCEPT THE CERTIFICATE ISSUED BY THE TAHSILDAR AND HOLD THE LAND SOLD BY THE ASSESSEE IS AGRICULTURAL LAND. ACCORDINGLY WE HEREBY HOLD THAT THE LAND HELD AND SOLD BY THE ASSESSEE IS AGRICULTURAL LAND SATISFYING THE CONDITIONS STIPULATED IN U/S.2(14)(III) OF THE ACT AND THEREFORE NOT EXIGIBLE FOR LONG TERM CAPITAL GAIN TAX. HENCE WE HEREBY DIRECT THE LD.AO TO DELETE THE LONG TERM CAPITAL GAIN ASSESSED IN THE HANDS OF THE ASSESSEE. 10. SINCE THE ASSESSEE HAS SUBMITTED AN AFFIDAVIT BEFORE US FOR WITHDRAWING THE GROUNDS WITH RESPECT TO REOPENING OF THE ASSESSMENT, WE RESTRAIN FROM ADJUDICATING THE SAME. 11. AS WE HAVE HELD THAT THE LAND SOLD BY THE ASSESSEE WITH RESPECT TO BOTH THE ASSESSMENT YEARS TO BE AGRICULTURAL LAND AND 17 ITA NOS.2883, 2884 & 3132/CHNY/2017 & ITA NOS.2040 & 2041/CHNY/2018 THEREFORE THE ASSESSEE SHALL NOT BE LIABLE TO BE TAXED UNDER THE HEAD LONG TERM CAPITAL GAINS, THE OTHER GROUNDS RAISED BY THE ASSESSEE IN THE APPEALS HAVE BECOME INFRACTUOUS AND DISMISSED AS SUCH. FOR THE SAME REASON WE HEREBY HOLD THE APPEAL OF THE ASSESSEE IN ITA NO.2040 & 2041 OF 2018 AGGRIEVED BY THE ORDER OF THE LD.PCIT U/S.263 OF THE ACT HAS ALSO BECOME INFRUCTUOUS AND DISMISSED AS SUCH BECAUSE THE ORDER OF THE LD.PCIT U/S 263 OF THE ACT DOES NOT SURVIVE. FURTHER FOR THE SAME REASON THE APPEAL OF THE REVENUE IN ITA NO.3132 OF 2017 HAS ALSO BECOME INFRUCTUOUS AND ACCORDINGLY DISMISSED. 12. IN THE RESULT, THE APPEALS OF THE ASSESSEE, IN ITA NO.2883 & 2884 OF 2017 ARE PARTLY ALLOWED AND APPEALS IN ITA NOS.2040 & 2041 OF 2018 ARE DISMISSED AS INFRUCTUOUS AND THE APPEAL OF THE REVENUE IN ITA NO.3132 OF 2017 IS ALSO DISMISSED AS INFRUCTUOUS. ORDER PRONOUNCED ON THE 30 TH MAY, 2019 AT CHENNAI. SD/- SD/- ( ) (DUVVURU R.L REDDY) /JUDICIAL MEMBER ( . ) (A. MOHAN ALANKAMONY) / ACCOUNTANT MEMBER /CHENNAI, /DATED 30 TH MAY, 2019 18 ITA NOS.2883, 2884 & 3132/CHNY/2017 & ITA NOS.2040 & 2041/CHNY/2018 RSR /COPY TO: 1. /ASSESSEE 2. /REVENUE 3. ( )/CIT(A) 4. /CIT 5. /DR 6. /GF