Girdhari Lal, Ghaziabad V. ITO, Ghaziabad

ITA 3213/DEL/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 91149 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-06-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 07-05-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 21-05-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: T VASANTHAN
• Keywords: Sale consideration of property below Jantri Value; Opportunity of being heard; Principle of natural justice
• Section: 143(3); 50C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: C NEW DELHI BEFORE SHRI G. C. GUPTA, HON BLE VICE - PRESIDENT AND SHRI INTURI RAMA RAO , ACCOUNTANT MEMBER I .T.A .NO. - 3213/DEL/2013 (ASSESSMENT YEAR - 2007 - 0 8 ) GIRDHARI LAL VS. ITO C/O AKHILESH KUMAR, ADVOCATE WARD - 1(2), CHAMBER NO. 206 - 207, ANSAL SATYAM GHAZIABAD. RDC RAJ NAGAR, GHAZIABAD PAN: A ALPL5099D (APPELLANT) (RESPONDENT) ASSESSEE BY: - SH. A KHILESH KUMAR , ADV . REVENUE BY: - SH. T VASAN THAN, SR. DR DATE OF HEARING: 07 /05/2015 DATE OF PRONOUNCEMENT: 12 /06/2015 ORDER PER INTURI RAMA RAO , AM : THIS IS AN APPEAL FILED BY THE ASSESSEE DIRECTED AGAINST THE ORDER OF LD. CIT(A) , GHAZIABAD IN APPEAL NO.116/2009 - 10/GZB DATED 2 6 . 03 .201 3 FOR THE ASSESSMENT YEAR 200 7 - 0 8 . THE SE GROUNDS RAISED IN THIS APPEAL ARE AS UNDER : I.T.A .NO. - 3213/DEL/2013 2 1. BECAUSE, THE ORDER OF LEARNED LOWER AUTHORITY IS BAD IN LAW AND AGAINST THE FACTS AND CIRCUMSTANCES OF THE CASE AND HENCE IS UNSUSTAINABLE. 2. BECAUSE, THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) GROSSL Y ERRED IN NOT APPRECIATING THE FACT THAT THE LD. AO HAS TOTALLY FAILED TO CONSIDER THE CLAIM U/S 2(14)(III)/45 BEING GAIN FROM SALE OF AGRICULTURAL LAND/STORES SITUATED BEYOND 12 KM FROM THE MUNICIPAL LIMITS AND INSTEAD REJECTED THE SAME SUMMARILY WHILE N ONE OF THE LOWER AUTHORITY NEITHER CONSIDERED THE EVIDENCES/MATERIAL ON THE RECORD NOR CONDUCTED ANY ENQUIRY ABOUT THE SAME. HENCE ORDERS OF BOTH THE LOWER AUTHORITIES ARE AGAINST PROVISIONS OF NATURAL JUSTICE AND THERE IS NO SPEAKING/REASONED ORDER. 3. BE CAUSE, WITHOUT PREJUDICE TO ABOVE BUT AS AN ALTERNATIVE, LEARNED COMMISSIONER OF INCOME TAX (APPEALS) FURTHER FAILED TO APPRECIATE THE FACT THAT THE LD. AO HAS NOT EVEN CONSIDERED THE FACT THAT EVEN IF SALE OF ROOMS/ STORES ARE NOT TO BE CONSIDERED U/S 2(14 ) AS ABOVE THAN THE CLAIM ABOUT THE LAND SHOULD HAVE BEEN CONSIDERED U/S 2(14). 4. BECAUSE, LEARNED COMMISSIONER OF INCOME TAX (APPEALS) GROSSLY ERRED IN NOT APPRECIATING THE FACT THAT SECTION 50C HAS NO APPLICABILITY AS PROPERTY UNDER QUESTION IS A RURAL AGRICULTURAL LAND AT THE RELEVANT TIME. I.T.A .NO. - 3213/DEL/2013 3 5. BECAUSE, WITHOUT PREJUDICE TO ABOVE BUT ONLY AS AN ALTERNATIVE, LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN NOT APPRECIATING THE UNUSUAL SURROUNDING CIRCUMSTANCES OF THE CASE ON THE RECORD UNDER WHICH IT WAS REQUIRED TO REFER MATTER TO DVO U/S 50C(2)(B) OF THE ACT. AS SUCH REJECTION OF CLAIM U/S 2(14)(III) AND APPLICATION OF PROVISIONS OF SECTION 50C ARE ILLEGAL AND CONSEQUENT ADDITION OF RS.3381514/ - IS NOT SUSTAINABLE HENCE IT IS HEREBY PRAYED T HAT THE TOTAL ADDITION MAY KINDLY BE QUASHED. WITHOUT PREJUDICE TO THE ABOVE BUT ONLY IN ALTERNATIVE, IF IT IS NOT POSSIBLE TO ALLOW THE ABOVE PRAYER THAN IT IS ALTERNATIVELY PRAYED THAT LD. AO MAY KINDLY BE DIRECTED TO EXAMINE THE ISSUE AFRESH IN THE INTE REST OF JUSTICE AS DEEMED FIT BY THE HON BLE COURT. 2. B RIEFLY STATED THE FACTS OF THE CASE ARE THAT THE APPELLANT IS INDIVIDUAL AND DERIVED INCOME UNDER THE HEAD OF CAPITAL GAINS AND INCOME FROM OTHER SOURCES. THE RETURN OF INCOME FOR THE A.Y. 2007 - 08 WA S FILED ON 31 ST MARCH 2008, DECLARING INCOME OF RS.1,45,140/ - . AFTER PROCESSING THE RETURN OF INCOME UNDER THE PROVISION OF SECTION 143(1) OF THE INCOME TAX ACT, THE CASE WAS SELECTED FOR SCRUTINY ASSESSMENT BY ISSUING NOTICE U/S 143(2) OF THE I.T. ACT AND THE ASSESSMENT WAS COMPLETED U/S 143(3) OF THE I.T. ACT VIDE ORDER DATED I.T.A .NO. - 3213/DEL/2013 4 18 TH DECEMBER 2009 A T TOTAL INCOME OF RS.33,92,830/ - BY MAKING ADDITION OF RS.33,81,514/ - UNDER THE PROVISIONS OF SECTION 50C OF THE ACT IN RESPECT OF LAND SOLD BY HIM. 3. AGGRIEVED BY THIS ASSESSMENT ORDER AN APPEAL WAS FILED BEFORE THE LD. CIT(A) GHAZIABAD , CONTENDING INTER ALIA THAT THE PROVISIONS OF SECTION 50C CANNOT BE APPLIED IN THE INSTANT CASE, INASMUCH AS THE PROPERTY SOLD WAS AGRICULTURE LAND SITUATED BEYOND 12 K.M. FROM T HE MUNICIPAL CORPORATION LIMITS. THEREFORE, THE LAND IS COVERED BY THIS PROVISION OF SECTION 2(14)(III) OF THE ACT THEREFORE, HE CONTENDED THAT THE PROVISIONS OF SECTION 50C CANNOT BE MADE APPLICABLE TO THIS TRANSACTION . H OWEVER, THE L D. CIT(A) WITHOUT GOING INTO THIS ISSUE WHETHER THE PROPERTY SOLD IS AGRICULTURE LAND WITHIN THE MEANING OF PROVISIONS OF SECTION 2(14)(III) OF THE ACT OR NOT SIMPLY AFTER REFERRING TO CERTAIN CASE LAWS GOVERNING THE PROVISIONS OF SECTION 50C OF THE ACT, DISMISS ED THE APPE AL OF THE A PPELLANT . BEING AGGRIEVED, THE APPELLANT HAD COME UP WITH THE PRESENT APPEAL. I.T.A .NO. - 3213/DEL/2013 5 4. IT WAS ARGUED ON BEHALF OF THE APPELLANT THAT THE TRANSACTION IS COVERED BY PROVISIONS OF SECTION 2(14)(III) OF THE ACT, AND THEREFORE, THE QUESTION OF INVOKING TH E PROVISIONS OF SECTION 50C DOES NOT ARISE INASMUCH AS THE GAINS IF ANY, ARISING OUT OF TRANSACTION ARE EXEMPT FROM CAPITAL GAINS. ON THE OTHER HAND THE LD. DR RELIED ON THE ORDERS OF THE LOWER AUTHORITIES. 5 . WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSE D THE RELEVANT MATERIAL PLACED ON RECORD. IT APPEARS THAT THE AO HAD NOT CONSIDERED THE ISSUE WHETHER THE LAND IS AGRICULTURE LAND OR NOT. EVEN THE LD. CIT(A) DESPITE FILING THE EVIDENCE BEFORE HIM SIMPLY IGNORED THE SUBMISSIONS MADE IN THIS REGARD W ITHOUT ASSIGNING ANY REASONS . T HEREFORE, IN THE INTEREST OF JUSTICE, WE RESTORE THE MATTER TO THE FILE OF THE AO TO CONSIDER THE EVIDENCE BROUGHT ON RECORD AND TAKE A VIEW WHETHER THE LAND SOLD AGRICULTURE IS OR NOT. IF THE LAND SOLD WAS AGRICULTURE LAND WITHIN THE MEANING OF PROVISION OF SECTION 2(14)(III) OF THE ACT THEN THE QUESTION OF INVOKING THE PROVISIONS OF SECTION 50C DOES NOT ARISE. ACCORDINGLY, WITH THE ABOVE DIRECTIONS, THE MATTER IS I.T.A .NO. - 3213/DEL/2013 6 RESTORED TO THE FILE OF THE AO FOR SUCH DISPOSAL AFTER GIVING ADEQUA TE OPPORTUNITY OF BEING HEARD TO THE APPELLANT. 6 . IN THE RESULT, APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 12 /06/2015. SD/ - SD/ - ( G. C. GUPTA ) ( INTURI RAMA RAO ) VICE - PRESIDENT ACCOUNTANT MEMBER DATED: 12 /06/2015 *AK VERMA* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR I.T.A .NO. - 3213/DEL/2013 7 DATE INITIAL 1. DRAFT DICTATED ON 11 /06/2015 PS 2. DRAFT PLACED BEFORE AUTHOR 11 /06/2015 PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS PS/PS 6. KEPT FOR PRONOUNCEMENT ON PS 7. FILE SENT TO THE BENCH CLERK PS 8. DATE ON WHICH FILE GOES TO THE AR 9. DATE ON WHICH FILE GOES TO THE HEAD CLERK. 10. DATE OF DISPATCH OF ORDER.