Shri Mangubhai Rambhai Patel, Surat V. The Income tax Officer,Ward-9(3), Surat

ITA 3257/AHD/2008

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 5710 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 9 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-07-2010
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 30-06-2010
• Assessment Year: 2000-2001
• Appeal Filed On: 23-09-2008
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A K KHENDELWAL
• Assessee Lawyers: J P SHAH
• Keywords: Unexplained investment
• Section: 69A; 148; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AT AHMEDABAD AHMEDABAD A BENCH (BEFORE S/SHRI G.D. AGARWAL, VICE-PRESIDENT AND MUKUL SHRAWAT, JUDICIAL MEMBER) ITA NO.3257/AHD/2008 [ASSTT.YEAR : 2000-2001] MANGUBHAI RAMBHAI PATEL PATEL FALIA, NANA VARACHHA SURAT. PAN : ATKPP 8674 N VS. ITO, WARD-9 (3) SURAT. ASSESSEE BY : SHRI J.P. SHAH REVENUE BY : SHRI A.K.KHENDELWAL O R D E R PER G.D. AGARWAL, VICE-PRESIDENT : THIS IS ASSESSEES APPEAL AGAINST THE ORDER OF THE CIT(A)-V, SURAT DATED 03.0 7.2008 ARISING OUT OF THE ORDER OF THE ASSESSING OFFICER PASSED UNDER SECTION 144 R.W.S. 147 OF THE INCOME TAX ACT, 1961. 2. IN THIS APPEAL, THE ASSESSEE HAS RAISED THE FOLL OWING GROUNDS: 1. THE CIT(A) ERRED IN UPHOLDING THE VALIDITY OF N OTICE UNDER SEC1248 THOUGH IT WAS BAD IN LAW, NOT FULFILLING TH E REQUIREMENTS UNDER THE I.T.ACT, 1961. 2. THE CIT(A) ERRED IN UPHOLDING THE ADDITION OF RS .70,00,000/- AS ALLEGED UNEXPLAINED MONEY. 3. THE CIT(A) ERRED IN NOT TAKING INTO CONSIDERATIO N THE EVIDENCE PRODUCED BEFORE HIM ON THE PRETEXT THAT THEY WERE N OT PRODUCED BEFORE THE AO BUT BEFORE DOING SO COMPLETELY OVERLO OKED THE FACTS AND CIRCUMSTANCES AS STATED BY THE ASSESSEE B EFORE HIM. 4. THE CIT(A) GROSSLY ERRED IN NOT APPRECIATING THE OVERALL FACTS AND CIRCUMSTANCES OF THE CASE AND IN THE PROCESS UP HELD THE ADDITION. PAGE - 2 ITA NO.3257/AHD/2008 -2- 3. AT THE TIME OF HEARING BEFORE US, THE LEARNED CO UNSEL FOR THE ASSESSEE DID NOT PRESS GROUND NO.1. ACCORDINGLY, THE SAME IS RE JECTED. 4. WITH REGARD TO GROUND NO.2 IT IS SUBMITTED BY TH E LEARNED COUNSEL THAT THE AO MADE THE ADDITION OF RS.70,00,000/- AS UNEXP LAINED MONEY UNDER SECTION 69A BEING SALE CONSIDERATION ON THE SALE OF LAND. HE HAS SUBMITTED THAT FOR THE SALE CONSIDERATION ON THE SALE OF THE LAND, CAN NEVER BE TREATED AS UNEXPLAINED INVESTMENT UNDER SECTION 69A. THE SALE CONSIDERATION ON THE SALE OF A LAND IS CHARGEABLE TO CAPITAL GAIN TAX IN THE YEAR IN WHICH THE LAND IS TRANSFERRED. HE HAS SUBMITTED THAT EVEN THE CAPITA L GAIN IS NOT CHARGEABLE IN THE ASSESSMENT YEAR UNDER CONSIDERATION I.E. THE ASSESS MENT YEAR 2000-2001, BECAUSE THE LAND WAS NOT TRANSFERRED DURING THE ACC OUNTING YEAR RELEVANT TO THE ASSESSMENT YEAR UNDER CONSIDERATION. HE FURTHER SU BMITTED THAT EVEN IN THE YEAR OF TRANSFER OF THE LAND NO CAPITAL GAIN TAX WO ULD BE CHARGEABLE BECAUSE THE LAND IS AGRICULTURAL LAND. 5. THE LEARNED DR, ON THE OTHER HAND, RELIED UPON T HE ORDERS OF THE AUTHORITIES BELOW. HE POINTED OUT THAT DURING THE COURSE OF SURVEY, IN THE CASE OF M/S.OHM CONSTRUCTION, SURAT, INFORMATION WAS GAT HERED THAT THE ASSESSEE HAD SOLD THE LAND TO THEM FOR CONSIDERATION OF RS.7 0 LAKHS. NO RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION WAS FURNISH ED BY THE ASSESSEE AND THEREFORE NOTICE UNDER SECTION 148 WAS ISSUED. HOW EVER, EVEN IN RESPONSE TO THE NOTICE UNDER SECTION 148 NO RETURN WAS FILED BY THE ASSESSEE. THE ASSESSEE ALSO DID NOT RESPOND TO ANY OF THE NOTICES ISSUED B Y THE AO. IN THE ABOVE CIRCUMSTANCES, THE AO WAS LEFT WITH NO OPTION BUT T O ASSESS THE ENTIRE SUM OF RS.70 LAKHS AS THE INCOME OF THE ASSESSEE. HE THER EFORE SUBMITTED THAT IN VIEW OF NON-COOPERATION OF THE ASSESSEE, THE ORDER MADE BY THE AO MAY BE CONFIRMED OR ALTERNATIVELY, THE SAME MAY BE SET ASI DE TO THE FILE OF THE AO AND DIRECTION MAY BE GIVEN TO THE ASSESSEE FOR FURNISHI NG ENTIRE DETAILS BEFORE THE AO. PAGE - 3 ITA NO.3257/AHD/2008 -3- 6. WE HAVE CAREFULLY CONSIDERED THE ARGUMENTS OF BO TH THE SIDES AND PERUSED MATERIALS PLACED BEFORE US. THE AO ASSESSE D THE SUM OF RS.70 LAKHS IN THE HANDS OF THE ASSESSEE WITH THE FOLLOWING NARRAT ION: SALE CONSIDERATION ON SALE OF LAND TREATED AS UNEX PLAINED MONEY U/S.69A AS DISCUSSED ABOVE. IN OUR OPINION, THE SALE CONSIDERATION ON SALE OF T HE LAND, IS CHARGEABLE TO CAPITAL GAIN TAX IN THE YEAR IN WHICH THE LAND IS T RANSFERRED. HOWEVER, THE SAME CANNOT BE ASSESSED AS UNEXPLAINED MONEY UNDER SECTI ON 69A. BEFORE US, THE RELEVANT FACTS WERE NOT PLACED BY EITHER SIDE, SO A S TO ASCERTAIN TAXABILITY OF THE CAPITAL GAIN. IN FACT IT SEEMS THAT ALL THE RELEVAN T DETAILS WERE NOT PRODUCED BY THE ASSESSEE EVEN BEFORE THE AO. IN THE ABOVE CIRC UMSTANCES, IN OUR OPINION, IT WOULD MEET ENDS OF THE JUSTICE, IF THE ORDERS OF TH E LOWER AUTHORITIES ARE SET SIDE AND THE MATTER IS RESTORED BACK TO THE FILE OF THE AO. WE ORDER ACCORDINGLY AND WE DIRECT THE AO TO ALLOW ADEQUATE OPPORTUNITY TO T HE ASSESSEE TO PRODUCE ALL THE RELEVANT DETAILS IN THIS REGARD. WE ALSO DIREC T THE ASSESSEE TO PRODUCE NECESSARY DETAILS WITH REGARD TO THE RECEIPT OF THE MONEY BY THE ASSESSEE, AND ALSO THE TRANSFER OF THE LAND. 7. IN THE RESULT, THE ASSESSEES APPEAL IS DEEMED T O BE PARTLY ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT 2 ND JULY, 2010. SD/- SD/- (MUKUL SHRAWAT) JUDICIAL MEMBER (G.D. AGARWAL) VICE-PRESIDENT PLACE : AHMEDABAD DATE : 02-07-2010 COPY OF THE ORDER FORWARDED TO: 1) : ASSESSEE PAGE - 4 ITA NO.3257/AHD/2008 -4- 2) : RESPONDENT 3) : CIT(A) 4) : CIT CONCERNED 5) : DR, ITAT. BY ORDER AR, ITAT, AHMEDABAD