Vishnu Chithan Rajam, CHENNAI V. ITO Non Corporate Ward 2(2), CHENNAI

ITA 3031/CHNY/2017

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 5193 (ITAT-CHENNAI)
• Duration Of Justice: 6 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-06-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2013-2014
• Appeal Filed On: 11-12-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ASISH TRIPATHY
• Assessee Lawyers: S V VENKATESHWARAN
• Keywords: Cost of acquisition
• Section: 54B

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, CHENNAI . . . , . !'# ! , % !& BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ./ ITA NO.3031/CHNY/2017 ( )( / ASSESSMENT YEAR : 2013-14 SHRI VISHNU CHITHAN RAJAM, NEW NO.27, OLD NO.11, SATHYA NARAYANA AVENUE, OFF BOAT CLUB ROAD, R.A. PURAM, CHENNAI - 600 028. PAN : AKCPR 3287 N V. THE INCOME TAX OFFICER, NON CORPORATE WARD - 2(2), CHENNAI - 600 034. (+,/ APPELLANT) (-.+,/ RESPONDENT) +, / 0 / APPELLANT BY : SHRI S.V. VENKATESHWARAN, CA -.+, / 0 / RESPONDENT BY : SHRI ASISH TRIPATHY, JCIT 1 / 2% / DATE OF HEARING : 22.05.2018 3') / 2% / DATE OF PRONOUNCEMENT : 14.06.2018 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER: THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) -2, CHENNA I, DATED 27.09.2017 AND PERTAINS TO ASSESSMENT YEAR 2013-14. 2 I.T.A. NO.3031/CHNY/17 2. SHRI S.V. VENKATESHWARAN, THE LD. REPRESENTATIVE FOR THE ASSESSEE, SUBMITTED THAT THE ONLY ISSUE ARISES FOR CONSIDERATION IS DISALLOWANCE OF DEDUCTION CLAIMED BY THE ASSESSEE U NDER SECTION 54B OF THE INCOME-TAX ACT, 1961 (IN SHORT 'THE ACT' ). ACCORDING TO THE LD. REPRESENTATIVE, THE ASSESSEE OWNED AN AGRIC ULTURAL LAND AT INJAMBAKKAM AND SOLD THE SAME ON 08.01.2013. AFTER ADJUSTING THE INDEX COST OF ACQUISITION, THE IMPROVEMENT AND OTHE R EXPENDITURE, THE CAPITAL GAIN WAS COMPUTED AT 3,58,24,032/-. ACCORDING TO THE LD. REPRESENTATIVE, THE ASSESSEE CLAIMED DEDUCTION OF 50 LAKHS UNDER SECTION 54EC OF THE ACT AND THE BALANCE OF 3.08 CRORES UNDER SECTION 54B OF THE ACT. ACCORDING TO THE LD. REPRESENTATIVE, THE ASSESSEE HAD INVESTED LONG TERM CAPITAL GAINS T O THE EXTENT OF 2.63 CRORES IN THE CAPITAL GAINS ACCOUNT SCHEME AND 50 LAKHS WAS PAID AS ADVANCE TO HIS FATHER SHRI SRINATH RAJA M TO ACQUIRE AN AGRICULTURAL LAND AT BURLIAR VILLAGE, COONOOR, THER EFORE, LONG TERM CAPITAL GAIN WAS NOT AVAILABLE FOR TAXATION. 3. SHRI S.V. VENKATESHWARAN, THE LD. REPRESENTATIVE FOR THE ASSESSEE FURTHER SUBMITTED THAT WITH REGARD TO INVE STMENT MADE BY THE ASSESSEE, THERE IS NO DISPUTE. HOWEVER, ACCORD ING TO THE LD. REPRESENTATIVE, THE ASSESSING OFFICER DISPUTES THAT THE LAND SOLD BY 3 I.T.A. NO.3031/CHNY/17 THE ASSESSEE AT INJAMBAKKAM VILLAGE, SHOLINGANALLUR , IS NOT AN AGRICULTURAL LAND. ACCORDING TO THE LD. REPRESENTA TIVE, THE LAND OWNED BY THE ASSESSEE WAS CLASSIFIED AS DRY LAND IN THE STATE REVENUE RECORDS. THE ASSESSEE HAS CULTIVATED THE L AND WITH COCONUT TREES. THE LD. REPRESENTATIVE FURTHER CLAR IFIED THAT THE LAND IN QUESTION IS SITUATED ADJACENT TO THE SEASHORE AT INJAMBAKKAM, THEREFORE, IT IS ALSO NOT FIT FOR CULTIVATION. ON A QUERY FROM THE BENCH AS PER THE COASTAL ZONE REGULATIONS, HOW IT WAS CLA SSIFIED? THE LD. REPRESENTATIVE CLARIFIED THAT IT WAS CLASSIFIED AS CRZ III. SINCE IT WAS CLASSIFIED AS CRZ III, ACCORDING TO THE LD. REP RESENTATIVE, NO CONSTRUCTION ACTIVITIES PERMITTED. ON A FURTHER QU ERY FROM THE BENCH, IF IT IS CLASSIFIED AS CRZ III, THEN HOTEL / RESORT AND GAME RELATING TO WATER MAY BE DEVELOPED WITH PREVIOUS AP PROVAL OF THE COASTAL ZONE REGULATION AUTHORITY? THE LD. REPRESE NTATIVE SUBMITTED THAT NO SUCH PERMISSION CAN BE OBTAINED F OR DEVELOPMENT OR CONSTRUCTION. 4. THE LD. REPRESENTATIVE FOR THE ASSESSEE WAS VERY FAIR ENOUGH IN BRINGING TO THE NOTICE OF THE BENCH THAT IN THE CASE OF CO- OWNER IN RESPECT OF THE VERY SAME PROPERTY, THE SAM E ISSUE WAS REMITTED BACK TO THE ASSESSING OFFICER BY AN ORDER DATED 4 I.T.A. NO.3031/CHNY/17 28.12.2017. THE LD. REPRESENTATIVE HAS ALSO CLARIF IED THAT IN THE CASE OF CO-OWNER, THE ADANGAL EXTRACT WAS NOT FILED BEFORE THE AUTHORITIES BELOW, THEREFORE, THIS TRIBUNAL REMITTE D BACK THE MATTER TO THE FILE OF THE ASSESSING OFFICER. IN THIS PRES ENT CASE, ACCORDING TO THE LD. REPRESENTATIVE, THE ADANGAL EXTRACT, PAT TA, VILLAGE [10(1)] ACCOUNT ARE PRODUCED BOTH BEFORE THE LOWER AUTHORIT IES AND BEFORE THIS TRIBUNAL, THEREFORE, THE CASE OF THE ASSESSEE IS DISTINGUISHABLE FROM THE CASE OF THE CO-OWNER THAT WAS DECIDED BY T HIS TRIBUNAL. THE LD. REPRESENTATIVE HAS ALSO PLACED HIS RELIANCE ON THE JUDGMENT OF MADRAS HIGH COURT IN SAKUNTALA VEDACHALAM V. ACI T IN T.C.A. NO.566 & 567/2013. 5. ON THE CONTRARY, SHRI ASISH TRIPATHY, THE LD. DE PARTMENTAL REPRESENTATIVE, SUBMITTED THAT THE LAND IN QUESTION AT INJAMBAKKAM WAS CLASSIFIED AS RESIDENTIAL LAND BY THE STATE REG ISTRATION DEPARTMENT. MERELY BECAUSE THE ASSESSEE HAS PLANTE D SOME COCONUT TREES, THE LAND WILL NOT BE CONSTRUED AS AG RICULTURAL LAND. ACCORDING TO THE LD. D.R., THE LAND IN QUESTION WAS CLASSIFIED AS DRY LAND BY THE STATE GOVERNMENT. IT WAS ALSO REPORTED AS RESIDENTIAL LAND BY THE STATE REGISTRATION DEPARTMENT. THEREFO RE, ACCORDING TO THE LD. D.R., THE CIT(APPEALS) HAS RIGHTLY FOUND TH AT IT IS NOT AN 5 I.T.A. NO.3031/CHNY/17 AGRICULTURAL LAND. THE LD. D.R. FURTHER SUBMITTED THAT THE LAND IS SITUATED WITHIN CITY LIMITS. THE EXISTENCE OF COCO NUT TREES MAY BE INCIDENTAL. IT DOES NOT ALTER THE CHARACTER OF THE LAND. 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. IN THE CASE OF THE CO-OWNER SHRI KESHAV SUNDERAM RAJAM IN I.T.A. NO.1758/MDS/2017, THIS TRIBUNAL BY ORDER DATED 28.1 2.2017, REMITTED THE MATTER BACK TO THE FILE OF THE ASSESSI NG OFFICER. THE ASSESSING OFFICER WAS DIRECTED TO RE-EXAMINE THE MA TTER AFRESH IN THE LIGHT OF THE MATERIAL THAT MAY BE PRODUCED BY T HE ASSESSEE AND THEREAFTER DECIDE THE ISSUE AFRESH IN ACCORDANCE WI TH LAW, AFTER GIVING A REASONABLE OPPORTUNITY TO THE ASSESSEE. S INCE THE PRESENT ASSESSEE IS ALSO ONE OF THE CO-OWNERS OF THE PROPER TY, FOR THE SAKE OF CONSISTENCY, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE MATTER NEEDS TO BE RE-EXAMINED BY THE ASSESSING OFF ICER. ACCORDINGLY, THE ORDERS OF BOTH THE AUTHORITIES BEL OW ARE SET ASIDE AND THE ISSUE RAISED BY THE ASSESSEE IS REMITTED BA CK TO THE FILE OF THE ASSESSING OFFICER. THE ASSESSING OFFICER SHALL RE-EXAMINE THE MATTER IN THE LIGHT OF THE MATERIAL THAT MAY BE PRO DUCED BY THE ASSESSEE, MORE PARTICULARLY THE ADANGAL EXTRACT AND OTHER RELEVANT 6 I.T.A. NO.3031/CHNY/17 DOCUMENTS, AND THEREAFTER DECIDE THE ISSUE AFRESH I N ACCORDANCE WITH LAW, AFTER GIVING A REASONABLE OPPORTUNITY TO THE ASSESSEE. 7. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON 14 TH JUNE, 2018 AT CHENNAI. SD/- SD/- (. !'# ! ) ( . . . ) (A. MOHAN ALANKAMONY) (N.R.S. GANESAN) % / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 5 /DATED, THE 14 TH JUNE, 2018. KRI. / -267 87)2 /COPY TO: 1. +, /APPELLANT 2. -.+, /RESPONDENT 3. 1 92 () /CIT(A)-2, CHENNAI-34 4. PRINCIPAL CIT-1, CHENNAI 5. 7: -2 /DR 6. ;( < /GF.