Deputy Commissioner of Income-tax, V. Tilakraj Janakraj Tandon, Pune

ITA 293/PUN/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 88923 (ITAT-PUNE)
• Duration Of Justice: 11 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-02-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2009-2010
• Appeal Filed On: 14-02-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B C MALAKAR
• Assessee Lawyers: CHETAN DHOOT
• Keywords: Capital asset; Revised return
• Section: 43B; 143(3); 139(5)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B, PUNE BEFORE SHRI G.S. PANNU, ACCOUNTANT MEMBER AND MS. SUSHMA CHOWLA, JUDICIAL MEMBER ITA NO.293/PN/2014 ASSESSMENT YEAR: 2009-10 THE ASST. COMMISSIONER OF INCOME TAX, CIRCLE 8, PUNE . APPELLANT VS. TILAKRAJ JANAKRAJ TANDON 15, GOODWILL SOCIETY, AUNDH, PUNE 411007 . RESPONDENT PAN: AAIPT7612F APPELLANT BY : B.C. MALAKAR RESPONDENT BY : CHETAN DHOOT DATE OF HEARING : 22-01-2015 DATE OF PRONOUNCEMENT : 11-02-2015 ORDER PER SUSHMA CHOWLA, JM: THIS APPEAL FILED BY THE REVENUE IS AGAINST THE ORDER OF CI T(A)-V, PUNE, DATED 25.11.2013 RELATING TO ASSESSMENT YEAR 2009 -10 AGAINST THE ORDER PASSED UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961. 2. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL:- 1. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) WAS JUSTIFIED IN ALLOWING THE DEDUCTION OF RS.50 LAKHS CLAIMED U/S 54EC OF THE IT ACT 1961, WHEN NO SUCH CLAIM HAS B EEN MADE BY THE ASSESSEE IN THE RETURN OF INCOME FILED BY HIM AND THE REQUEST WAS MADE BEFORE THE AO THROUGH A LETTER AFTER THE T IME LIMIT PRESCRIBED U/S 139(5) HAD EXPIRED? 2. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) WAS JUSTIFIED IN ALLOWING THE DEDUCTION OF RS.50 LAKHS CLAIMED U/S 54EC OF THE IT ACT 196, CLAIMING THAT THE PRINCIP LE LAID DOWN BY HON'BLE SUPREME COURT IN THE CASE OF GOETZ (INDIA) LT D. VS. CIT {2006} 284 ITR 323 (SC) ARE NOT APPLICABLE TO THE CIT (A), WHEN IN ITA NO.293/PN/2014 TILAKRAJ JANAKRAJ TANDON 2 FACT, IT IS CLEARLY MENTIONED IN THE SAID ORDER OF HON 'BLE APEX COURT THAT THE PRINCIPLE LAID DOWN IN THE SAID ORDER ARE NO T APPLICABLE TO APPELLATE TRIBUNAL AND THERE IS NO MENTION OF CIT(A)? 3. THE APPELLANT CRAVES LEAVE TO ADD, AMEND OR ALTER ANY OF THE ABOVE GROUNDS OF APPEAL. 3. THE ONLY ISSUE RAISED IN THE PRESENT APPEAL IS AGAINST THE DECISION OF CIT(A) IN ALLOWING DEDUCTION OF RS.50 LAKHS CLAIMED UNDER SEC TION 54EC OF THE ACT WHEN NO SUCH CLAIM WAS MADE IN THE RETU RN OF INCOME FILED BY THE ASSESSEE. 4. THE BRIEF FACTS OF THE CASE ARE THAT, DURING THE YEAR UNDER CONSIDERATION THE ASSESSEE HAD DECLARED INCOME FROM LONG TERM CAPITAL GAINS ON TRANSFER OF CAPITAL ASSETS. THE NET LONG TERM CA PITAL GAINS WERE WORKED OUT TO RS.1,94,36,067/- WHICH IS NOT DISPUTED. THE ASSESSEE IN THE RETURN OF INCOME DID NOT CLAIM ANY DEDUCTION UNDER SE CTION 54EC OF THE ACT. HOWEVER, THE FACTS OF THE CASE ARE THAT THE A SSESSEE HAD MADE AN INVESTMENT IN REC BONDS OF RS.50 LAKHS ON 30.06.2008 I.E. WITHIN THE PRESCRIBED LIMIT ALLOWED UNDER THE ACT. THE ASSESSING OFFICE R REJECTED THE CLAIM OF THE ASSESSEE AS THE ASSESSEE HAD NEITHER M ADE THE CLAIM AT THE TIME OF FILING HIS RETURN OF INCOME NOR MADE ANY CLAIM BY FILING REVISED RETURN OF INCOME. THE ASSESSING OFFICER PLACED RELIA NCE ON THE RATIO LAID DOWN BY THE HONBLE SUPREME COURT IN GOETZ (I NDIA) LTD. VS. CIT (2006) 284 ITR 323 (SC). 5. THE CIT(A) HOWEVER, HELD THAT THE ASSESSEE WAS ENTITLE D TO THE CLAIM OF THE SAID DEDUCTION UNDER SECTION 54EC OF THE ACT, IN VIEW OF THE INVESTMENT IN THE REC BONDS MADE BY THE ASSESSEE ON 30.06.2008. RELIANCE IN THIS REGARD WAS PLACED ON THE RATIO LAID DOWN B Y THE HONBLE BOMBAY HIGH COURT IN CIT, CENTRAL-1 VS. M/S. PRUTHVI BROK ERS AND ITA NO.293/PN/2014 TILAKRAJ JANAKRAJ TANDON 3 SHAREHOLDERS PVT. LTD. IN INCOME TAX APPEAL NO.3908 OF 201 0, ORDER DATED 21.06.2012. 6. THE REVENUE IS IN APPEAL AGAINST THE ORDER OF CIT(A). T HE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE PLACED RELIAN CE ON THE ORDER OF ASSESSING OFFICER. 7. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSE E PLACED RELIANCE ON THE ORDER OF CIT(A). 8. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. THE ONLY ISSUE ARISING IN THE PRESENT APPEAL IS IN RELATION TO THE CLAIM OF DEDUCTION UNDER SECTION 54EC OF THE ACT AMOUNTING TO RS .50 LAKHS. THE ASSESSEE HAD SHOWN INCOME FROM LONG TERM CAPITAL GAINS ON SALE OF CAPITAL ASSETS, BUT IN THE RETURN OF INCOME FILED FOR THE Y EAR UNDER CONSIDERATION, THE ASSESSEE HAD FAILED TO MAKE ANY CLAIM UN DER SECTION 54EC OF THE ACT THOUGH THE INVESTMENT IN REC BONDS WER E MADE BY THE ASSESSEE ON 30.06.2008. THE RETURN OF INCOME WAS FILED BY THE ASSESSEE ON 31.07.2009. THE ASSESSEE DID NOT FURNISH ANY REVISED RETURN AGAINST THE SAID CLAIM OF DEDUCTION UNDER SECTION 54EC OF THE ACT . THE ASSESSING OFFICER REJECTED THE CLAIM OF THE ASSESSEE IN VIEW OF THE RATIO LAID DOWN BY THE HONBLE SUPREME COURT IN GOETZ (INDIA) LT D. VS. CIT (SUPRA). HOWEVER, THE CIT(A) ALLOWED THE CLAIM OF THE ASSESSE E OBSERVING AS UNDER:- 10. I HAVE CAREFULLY CONSIDERED THE FACTS OF THE CAS E AS WELL AS REPLY OF THE APPELLANT. IN THIS CASE, IT IS SEEN THAT TH E APPELLANT WAS ALLOTTED 500 RURAL ELECTRIFICATION CORPORATION LTD (REC) BONDS AT THE FACE VALUE OF 10,000/- EACH TOTALLING AT 50 LACS ON 30.06.2008. THE APPELLANT SHOULD HAVE CLAIMED THE SAME IN THE RETU RN OF INCOME WHICH WAS NOT DONE BY HIM. THE STAND OF THE ASSESSING OFFICER WAS JUSTIFIED IN VIEW OF HON'BLE SUPREME COURT'S DECISIO N IN THE CASE OF GOETZ (INDIA) LTD. V/S CIT 284 ITR 323. HOWEVER, SINCE THE APPELLANT IS ENTITLED TO THIS DEDUCTION U/S. 54EC OF INCOME-TAX ACT, THE RESTRICTIONS IMPOSED BY HON'BLE SUPREME COURT ARE NOT APPLICABLE IN RESPECT OF APPELLATE AUTHORITIES. THE SAME VIEW HAS BEE N TAKEN BY ITA NO.293/PN/2014 TILAKRAJ JANAKRAJ TANDON 4 HON'BLE BOMBAY HIGH COURT IN THE CASE OF CIT, CENTRA L-L VS. M/S. PRUTHVI BROKERS AND SHAREHOLDERS PVT. LTD IN ITA 3908 OF 2010, PASSED ON 21.06.2012. IN THAT CASE, THE CLAIM OF THE AP PELLANT REGARDING DEDUCTION OF 40 LACS U/S. 43B OF INCOME-TAX ACT WAS ALLOWED AT THE LEVEL OF CIT(A) WHICH UPHELD BY THE TRIBUN AL TOO. THIS VIEW WAS FURTHER UPHELD BY HON'BLE BOMBAY HIGH COURT IN T HE ABOVE MENTIONED JUDGMENT. THEREFORE, RELYING ON THE ABOVE ME NTIONED DECISION OF HON'BLE BOMBAY HIGH COURT, THE ASSESSING OFFICER IS DIRECTED TO ALLOW DEDUCTION U/S.54EC OF INCOME-TAX ACT , AMOUNTING TO 50 LACS. THUS, THE GROUND IS ALLOWED. 9. WE ARE IN CONFORMITY WITH THE FINDING OF CIT(A) THAT THE A SSESSEE IS ENTITLED TO THE SAID CLAIM AS THE RESTRICTIONS IMPOSED BY T HE HONBLE SUPREME COURT WERE NOT APPLICABLE IN RESPECT OF THE APPE LLATE AUTHORITIES. THE ASSESSEE HAVING INVESTED IN THE REC BO NDS ON 30.06.2008 AMOUNTING TO RS.50 LAKHS I.E. WITHIN THE PERIOD PRE SCRIBED UNDER THE ACT, IS ENTITLED TO THE CLAIM OF DEDUCTION UNDER SECTION 54EC OF THE ACT AGAINST THE INCOME FROM LONG TERM CAPITAL GAINS DE CLARED BY THE ASSESSEE. ACCORDINGLY, WE UPHOLD THE ORDER OF CIT(A) AND DISMISS THE GROUNDS OF APPEAL RAISED BY THE REVENUE. 10. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED ON THIS 11 TH DAY OF FEBRUARY, 2015. SD/- SD/- (G.S. PANNU) (SUSHMA CHOWLA) ACCOUNTANT MEMBER JUDICIAL MEMBER PUNE, DATED: 11 TH FEBRUARY, 2015. GCVSR COPY OF THE ORDER IS FORWARDED TO : - 1) THE DEPARTMENT; 2) THE ASSESSEE; 3) THE CIT(A)-V, PUNE; 4) THE CIT-V, PUNE; 5) THE DR B BENCH, I.T.A.T., PUNE; 6) GUARD FILE. BY ORDER //TRUE COPY// ASSISTANT REGISTRAR I.T.A.T., PUNE