SHWETA AVARSEKAR, MUMBAI V. ASST CIT CEN CIR 8(2), MUMBAI

ITA 304/MUM/2017

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 1109 (ITAT-MUMBAI)
• Duration Of Justice: 3 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-05-2017
• Appeal Filed By: Assessee
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 13-01-2017
• Court: TRIBUNAL
• Department Lawyers: SUNIL JHA
• Keywords: Question of law; Revised return
• Section: 54F; 153A; 147; 54; 139

Judgement Text

THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, MUMBAI BEFORE SHRI B.R. BASKARAN (AM) I.T.A. NO. 304 /MUM/ 201 7 (ASSESSMENT YEAR 20 10 - 1 1 ) MRS. SHWETA AVARSEKAR 1401, 4 TH FLOOR SHRUSHTI APARTMENT OLD PRABHADEVI ROAD PRABHADEVI MUMBAI - 400 025. VS. ACIT CC - 8(2) ERSTWHILE ACIT CENTRAL CIRCLE - 45 MUMBAI. ( APPELLANT ) ( RESPONDENT ) PAN NO . AAEPA22585 ASSESSEE BY SHRI VIJAY MEHTA DEPARTMENT BY SHRI SUNIL JHA DATE OF HEARING 4 . 5. 201 7 DATE OF PRONOUNCEMENT 4 .5 . 201 7 O R D E R THE APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 15.11.2016 PASSED BY THE LEARNED CIT(A) - 52, MUMBAI AND IT RELATES TO A.Y. 2010 - 11. THE ASSESSEE IS AGGRIEVED BY THE DECISION OF THE LEARNED CIT(A) IN CONFIRMING THE DISALLOWANCE OF EXEMPTION CLAIMED BY TH E ASSESSEE U/S. 54F OF THE ACT. 2. THE FACTS RELATING TO THE ISSUE ARE STATED IN BRIEF. THE ASSESSEE FILED HER RETURN OF INCOME U/S. 139(1) FOR THE YEAR UNDER CONSIDERATION ON 21.9.2011. THE ASSESSEE WAS SUBJECTED TO SEARCH ON 10.2.2012. CONSEQUENT THERET O, THE ASSESSEE FILED RETURN OF INCOME IN RESPONSE TO THE NOTICE ISSUED U/S. 153 OF THE ACT ON 14.12.2012. IN BOTH THE RETURNS THE ASSESSEE HAD DECLARED LONG TERM CAPITAL GAIN ON SALE OF COMMERCIAL PROPERTY. THE ASSESSEE DID NOT CLAIM ANY DEDUCTION U/S. 54 F OF THE ACT. SUBSEQUENTLY, THE ASSESSEE FILED A REVISED RETURN U/S. 153A OF THE ACT ON 31.1.2014, WHEREIN THE ASSESSEE CLAIMED DEDUCTION U/S. 54F OF THE ACT IN RESPECT OF A NEW FLAT PURCHASED BY HER. MRS. SHWETA AV ARSEKAR 2 3. THE ASSESSING OFFICER REJECTED THE CLAIM OF TH E ASSESSEE ON THE FOLLOWING GROUNDS : - (A) THE ASSESSEE ALREADY OWNS A PROPERTY AT AVASEKAR HEIGHTS AND THE SAME HAS BEEN LET OUT. T HE ASSESSEE IS STAYING IN ANOTHER RESIDENTIAL HOUSE PROPERTY , WHICH MEANS THAT SHE ALSO OWNS ONE MORE PROPERTY WHICH HAS NOT BEEN DISCLOSED IN THE RETURN OF INCOME. SINCE THE ASSESSEE HOLDS MORE THAN ONE RESIDENTIAL HOUSE PROPERTY ON THE DATE OF SALE OF COMMERCIAL ASSET, SHE HAS NOT ENTITLED FOR DEDUCTION U/S. 54F OF THE ACT. (B) HON'BLE APEX COURT IN THE CASE OF SUN ENGINEERING W ORKS PVT. LTD. (198 ITR 297) HAS HELD THAT THE ASSESSMENT U/S. 147 IS FOR THE BENEFITS OF THE REVENUE. 4 . BEFORE THE LEARNED CIT(A), THE ASSESSEE SUBMITTED THAT SHE WAS HOLDING ONLY ONE RESIDENTIAL FLAT AT AVASEKAR HEIGHTS AND SHE HAS PURCHASED ONE MORE FLAT AT SUMER TRINITY TOWER BY USING PRO CEEDS OF C OMMERCIAL PROPERTY. ACCORDINGLY , SHE SUBMITTED THAT SHE IS ELIGIBLE FOR DEDUCTION U/S. 54F OF THE ACT , AS SHE HELD ONLY ONE HOUSE ON THE DATE OF SALE OF COMMERCIAL ASSET . SHE SUBMITTED THAT THE FLAT, WHERE SHE RESIDES, DOES NOT BELONG TO HER. ACCORDINGLY T HE ASSESSEE CONTENDED THAT THE INFERENCE DR A WN BY THE ASSESSING OFFICER THAT SHE IS HOLDING ONE MORE PROPERT Y WHERE SHE RESIDES IS BASED ON P R E SUMPTION S ONLY. 5. HOWEVER, THE LEARNED CIT(A) TOOK THE VIEW THAT THE ASSESSEE CANNOT MAKE FRESH CLAIM S IN THE RETURN FILED U/S. 153A OF THE ACT AND IN THIS REGARD HE PLAC ED RELIANCE ON THE FOLLOWING CASE LAWS : - (A) CHARCHIT AGARWAL VS. CIT (129 TTJ 438)(DEL) (B) GENMAL KOTHARI VS. DCIT (139 ITD 297) AGGRIEVE D BY THE ORDER PASSED BY THE LEARNED CIT(A) THE ASSESSEE HAS FILED THIS APP E AL BEFORE US. 6 . WE HAVE HEARD THE PARTIES AND PERUSED THE RECORD. PRESUMPTION DRAWN BY THE ASSESSING OFFICER THAT THE ASSESSEE ALSO OWNS A PROPERTY WHERE SHE RESIDES IS ACCORDING TO LEARNED AR NOT BASED ON FACTS. HE SUBMITTED THAT THE MRS. SHWETA AV ARSEKAR 3 PROPERTY WHERE SHE RESIDES DOES NOT BELONG TO THE ASSESSEE. HE FURTHER SUBMITTED THAT THE DECISION RENDERED BY HON'BLE SUPREME COURT IN THE CASE OF SUN ENGINEERING WORKS PVT. LTD. (SUPRA) IS RELATED THE PROCEEDINGS U/S. 147 OF THE ACT, WHEREAS THE CURRENT PROCEEDINGS IS RELATED U/S. 153 A OF THE ACT. HE FURTHER SUBMITTED THAT THE CASE LAWS RELIED UPON BY LD CIT(A) (SUPRA) ARE RELATED TO UNABATED ASSESSMENT YEARS, WHEREAS THE YEAR UNDER CONSIDERATION IS ABATED ASSESSMENT. IN THE CASE OF ABATED ASSESSMENTS, THE ENTIRE ASSESSMENT IS OPEN BEFORE THE AO, SINCE THE ASSESSMENTS, IF ANY, PENDING SHALL ABATE. THE L EARNED AR SUBMITTED THAT HON'BLE BOMBAY HIGH COURT HAS CONSIDERED AN IDENTIC AL ISSUE IN THE CAS E OF CIT VS. B.G. SH I R KE CONSTRUCTION TECHNOLOGY ( P ) LTD. (2017) 293 CTR (BOM) 505, WHEREIN HON'BLE BOMBAY HIGH COURT HAS HELD THAT THE ASSESSEE COULD MAKE FRESH CLAIM BEFORE THE ASSESSING OFFICER IN 153A PROCEEDINGS, EVEN IF THE SAID CLAIM IS NOT MAKE IN THE RETURN FILED UNDER THAT SECTION . 6. LEARNED DEPARTMENTAL REPRESENTATIVE , ON THE CONTRARY, PLACED RELIANCE ON THE ORDER PASSED BY THE LEARNED CIT(A). 7. HAVING HEARD THE RIVAL CONTENTIONS, I AM OF THE VIEW THAT THERE IS MERIT IN THE CONTENTION OF TH E ASSESSEE , AS THE CLAIM OF THE ASSESSEE IS SUPPORTED BY THE DECISION RENDERED BY HON'BLE BOMBAY HIGH COURT IN THE CASE OF B.G. SHIRKE CONSTRUCTION TECHNOLOGY P. LTD. (SUPRA). THERE IS NO DISPUTE WITH REGARD TO THE FACT THAT THE PRESENT ASSESSMENT FALLS IN THE CATEGORY OF ABATED ASSESSMENT AND HENCE THE ENTIRE ASSESSMENT IS OPEN BEFORE THE AO. THIS ASPECT HAS BEEN CONSIDERED BY HONBLE BOMBAY HIGH COURT IN THE ABOVE SAID CASE AND F OR THE SAKE OF CONVENIENCE , I EXTRAC T BELOW THE RELEVANT OBSERVATION MADE BY HON'BLE BOMBAY HIGH COURT: - 10. THE RELIANCE ON THE DECISION OF THE APEX COURT IN CIT VS. SUN ENGINEERING WORKS (P) LTD. (SUPRA) BY THE REVENUE IS MISPLACED. THE ABOVE CASE DEALT WITH REOPENING OF AN ASSESSMENT UNDER S. 147 OF THE ACT. IT WAS IN THAT CON TEXT THAT THE APEX COURT OBSERVED THAT THE ORDER PASSED UNDER SS. 147/148 AND THE AO IS PRIMARILY RESTRICTED TO SUCH INCOME WHICH HAS ESCAPED ASSESSMENT AND DOES NOT PERMIT MRS. SHWETA AV ARSEKAR 4 RECONSIDERATION OF ISSUE WHICH ARE CONCLUDED IN THE EARLIER ASSESSMENT YEARS IN FAV OUR OF THE REVENUE. 11. IN THE PRESENT FACTS FOR THE SUBJECT ASSESSMENT YEARS IT IS AN UNDISPUTED POSITION THAT THE PENDING ASSESSMENT BEFORE THE AO CONSEQUENT TO RETURN FILED UNDER S. 139(1) OF THE ACT FOR THE SUBJECT ASSESSMENT YEARS HAD ABATED. THIS WAS ON ACCOUNT OF THE SEARCH AND AS PROVIDED IN SECOND PROVISO TO S. 153A(1) OF THE ACT. THE CONSEQUENCE OF NOTICE UNDER S. 153A(1) OF THE ACT IS THAT ASSESSEE IS REQUIRED TO FURNISH FRESH RETURN OF INCOME FOR EACH OF THE SIX ASSESSMENT YEARS IN REGARD TO WHICH A NOTICE HAS BEEN ISSUED. IT IS THIS RETURN WHICH IS FILED CONSEQUENT TO THE NOTICE WHICH WOULD BE SUBJECT OF ASSESSMENT BY THE REVENUE FOR THE FIRST TIME IN THE CASE OF ABATED ASSESSMENT PROCEEDINGS. CONSEQUENT TO NOTICE UN DER S. 153A OF THE ACT THE EARLIER RETURN FLIED FOR THE PURPOSE OF ASSESSMENT WHICH IS PENDING, WOULD BE TREATED AS NON - EST IN LAW. FURTHER, S. 153A(1) OF THE ACT ITSELF PROVIDES ON FILING OF THE RETURN CONSEQUENT TO NOTICE, THE PROVISIONS OF THE ACT WILL APPLY TO THE RETURN OF IN COME SO FILED. CONSEQUENTLY, THE RETURN FILED UNDER S. 153A(1) OF THE ACT IS A RETURN FURNISHED UNDER SECTION 139 OF THE ACT. CONSEQUENTLY, THE RESPONDENT - ASSESSEE IS BEING ASSESSED IN RESPECT OF ABATED ASSESSMENT FOR THE FIRST TIME UNDER THE ACT. THEREF ORE THE PROVISIONS OF THE ACT WHICH WOULD BE OTHERWISE APPLICABLE IN CASE OF RETURN FILED IN THE REGULAR COURSE UNDER S. 139(1) OF THE ACT WOULD ALSO CONTINUE TO APPLY IN CASE OF RETURN FILED UNDER S. 153A OF THE ACT AND THE CASE LAWS ON THE PROVISION OF T HE ACT WOULD EQUALLY APPLY. 12. THIS COURT IN CIT VS. PRUTHV I BROKERS & SHAREHOLDERS (P) LTD. (SUPRA) WHILE DEALING WITH A RETURN OF INCOME FILED UNDER S. 139(1) OF THE ACT HAS HELD THAT AN ASSESSEE IS ENTITLED TO RAISE A FRESH CLAIM BEFORE THE APPELLATE AUTHORITIES, EVEN IF THE SAME WAS NOT RAISED BEFORE THE AO AT THE TIME OF FILING RETURN OF INCOME OR BY FILING A REVISED RETURN OF INCOME. THIS COURT ALSO PLACED RELIANCE UPON DECISION OF THE APEX COURT IN NATTORTCJ.1 THERMAL POWER CO. LTD. VS. CIT (1999) 157 CTR (SC) 249: (1998) 229 ITR 383 (SC) WHEREIN WHILE DEALING WITH THE POWERS OF THE AO IT HAD HELD THAT A CLAIM NOT MADE IN THE RETURN OF INCOME, THE COURT MAY LEAD TO NON - ENTERTAINMENT OF CLAIM BY THE AO. HOWEVER, THIS RESTRICTION IN THE POWER OF THE A O WILL NOT AFFECT THE POWER OF THE TRIBUNAL TO ENTERTAIN A FRESH CLAIM. 13. IN VIEW OF THE FACT THAT THE ISSUE STANDS CONCLUDED BY THE DECISION OF II THIS COURT IN CIT VS. PRUTHVI BROKERS & SHAREHOLDERS 'P) LTD. (SUPRA) THE QUESTION AS PROPOSED DOES NOT G IVE RISE TO ANY SUBSTANTIAL QUESTION OF LAW. THUS NOT ENTERTAINED . IS TLD A. T E OF 'TD, NT OF IS ND MRS. SHWETA AV ARSEKAR 5 8. THUS I NOTICE THAT THE CLAIM OF THE ASSESSEE FOR DEDUCTION U/S 54F OF THE ACT CAN BE ENTERTAINED IN THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE. THE ASSESSEE HAS ALSO DEMONSTRATED BEFORE LD CIT(A) THAT SHE IS HOLDING ONLY ONE RESIDENTIAL HOUSE ON THE DATE OF SALE OF COMMERCIAL PROPERTY. IT HAS BEEN SUBMITTED THAT THE HOUSE, WHERE SHE RESIDES, DOES NOT BELONG TO HER. IF THAT BE THE CASE, THE ASSESSEE SHALL BE ENTITLED FOR DEDUCTION U/S. 54F OF THE ACT. HOWEVER, THE ASSESSEE HAS CHOSEN NOT TO DISCLOSE THE OWNERSHIP DETAILS OF THE HOUSE WHERE SHE IS RESIDING, I.E., WHETHER IT BELONGS TO SOME OTHER FAMILY MEMBERS OR IT WAS RENTED FLAT. ACCORDINGLY I SET ASIDE THE ORDER PASSED BY LD CI T(A) AND RESTORE THE SAME TO THE FILE OF THE ASSESSING OFFICER WITH THE DIRECT ION TO ALLOW THE CLAIM OF THE ASSESSEE U/S. 54F OF THE ACT AFTER SATISFYING HIMSELF ABOUT THE CLAIM OF THE ASSESSEE . 9. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER HAS BE EN PRONOUNCED IN THE COURT ON 4 . 5 . 201 7. SD/ - (B.R.BASKARAN) ACCOUNTANT MEMBER MUMBAI ; DATED : 4 / 5 / 20 1 7 COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. BY ORDER, //TRUE COPY// ( DY./ASSTT. REGISTRAR) PS ITAT, MUMBAI