ITO, WARD- 6(2), Nagpur V. SHRI DEVIDAS GOVINDRAO KIRPANE, Nagpur

ITA 337/NAG/2014

• Counselvise Citation: [2016] 121 COUNSELVISE.COM (IT) 4521 (ITAT-NAGPUR)
• Duration Of Justice: 2 year(s) 2 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-09-2016
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 18-08-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 20-06-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: AGNES P THOMAS
• Assessee Lawyers: HIMESH DEMBLE

Judgement Text

1 ITA NO. 337/NAG/2014. IN THE INCOME TAX APPELLATE TRIBUNAL, NAGPUR BENCH, NAGPUR BEFORE SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER. (S.M.C.) I.T.A. NO.337/NAG/2014. ASSESSMENT YEAR : 2009 - 10. THE INCOME - TAX OFFICER, SHRI DEVIDAS GOVINDRAO KIRPANE, WARD - 6(2), NAGPUR. VS. NAGPUR. PAN ADEPR 3256D. APPELLANT. RESPONDENT. APPELLANT BY : SMT. AGNES P. THOMAS. RESPONDENT BY : SHRI HIMESH DEMBLE. DATE OF HEARING : 08 - 09 - 2016 DATE OF PRONOUNCEMENT : 19 TH SEPT., 2016 O R D E R THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF LEARNED CIT(APPEALS) - II, NAGPUR DATED 04 - 03 - 2014 AND PERTAINS TO ASSESSMENT YEAR 2009 - 10. THE GROUNDS OF APPEAL READ AS UNDER : 1. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LEARNED CIT(APPEALS) HAS ERRED IN DECIDING THE ISSUE BY RELYING ONLY ON THE SUBMISSIO N OF THE ASSESSEE THAT HE AGREED TO PAY THE TAXES TREATING THE PROFIT AS SHORT TERM CAPITAL GAIN BY MISCONCEPTION, WITHOUT APPRECIATING THE FACT THAT THE ASSESSEE IS GUIDED BY A PROFESSIONAL I.E. THE CHARTERED ACCOUNTANT EXPECTED TO BE COMPLETELY DILIGEN T, CAUTIOUS AND CAREFUL WHILE PREPARING AND FINALIZING THE BUSINESS AFFAIRS OF HIS/HER CLIENT. 2. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LEARNED CIT(APPEALS) HAS ERRED IN NOT APPRECIATING THE FACT THAT THE ASSESSEE IS INTO REAL EST ATE BUSINESS AND HAS ACCORDINGLY COMPUTED THE TOTAL INCOME AND FILED THE RETURN OF INCOME. 2 ITA NO. 337/NAG/2014. 2. IN THIS CASE THE ASSESSEE HAS SOLD LAND FOR RS.76,79,000/ - . THE ASSESSEE HAS CLAIMED THE SAME TO BE AGRICULTURAL LAND. THE ENQUIRIES CONDUCTED BY THE AO SHOWED TH AT NO AGRICULTURAL ACTIVITY WAS CARRIED ON AND THE LAND WAS SOLD OUT OF A SHORT PERIOD OF 13 MONTHS. ON QUERY BY THE AO IN THIS REGARD THE ASSESSEE OFFERED THE PROFI T S ON SALE OF LAND UNDER THE HEAD SHORT TERM CAPITAL GAIN. 3. BEFORE THE LEARNED CIT(APPEALS) THE ASSESSEE SUBMITTED T HAT THE ASSESSEE HAD ERRONEOUSLY ACCEPTED TO PAY TAX IN THE AFORESAID SALE OF AGRICULTURAL LAND. LEARNED CIT(APPEALS) ACCEPTED THIS SUBMISSION AND PROCEEDED TO EXAMINE THE ISSUE. HE AGREED WITH THE AS SESSEE THAT NO CAPITAL GAIN WAS EXIGIBLE AS THE SALE OF THAT AGRICULTURAL LAND. 4. AGAINST THE ABOVE ORDER, THE REVENUE IS IN APPEAL BEFORE THE ITAT. 5. I HAVE HEARD BOTH THE COUNSEL AND PERUSED THE RECORDS. I FIND THAT IN EXPLANATION TO THE QUERY BY THE A O THE ASSESSEE HAS AGREED TO OFFER THE CAPITAL GAIN TAX ON THE SALE OF AFORESAID LAND. THUS THE ASSESSEE CLEARLY STOP PED THE AO FROM MAKING ANY FURTHER ENQUIRY/INVESTIGATION. BEFORE THE LEARNED CIT(APPEALS) THE ASSESSEE CHANGED I T S STANCE AND CLAIMED THA T IT WAS ON ACCOUNT OF WRONGFUL ADVISE THAT HE HAD AGREED TO PAY THE TAX. THEREAFTER THE LEARNED CIT(APPEALS) EXAMINED THE ASSESSEES SUBMISSION AND CAME TO THE CONCLUSION THAT THE ASSESSEES CLAIM WAS CORRECT. 6. IN THIS REGARD I FIND THAT PRINCIPLE OF NA TURAL JUSTICE APPLY TO THE ASSESSEE AS WELL AS THE REVENUE. AFTER THE AO HAS BEEN STOPPED IN MAKING ANY FURTHER ENQUIRY/INVESTIGATION BY THE ADMISSION OF THE ASSESSEE IN OFFERING THE SALE OF LAND AS CAPITAL GAIN IT WAS INCUMBENT UPON THE LEARNED CIT(APPEAL S) TO SEND THE SUBMISSIONS OF THE ASSESSEE REGARDING HIS CLAIM OF AGRICULTURAL LAND FOR REMAND/EXAMINATION BY THE AO. ADMITTEDLY IN THIS CASE LEARNED CIT(APPEALS) HAS NOT DONE ANY SUCH ACTIVITY. HENCE IN MY CONSIDERED OPINION THE ORDER OF 3 ITA NO. 337/NAG/2014. LEARNED CIT(APPEA LS) SUFFERS FROM INFIRMITY. THE AO DESERVES THE CHANCE TO EXAMINE THE SUBMISSION OF THE ASSESSEE BEFORE THE LEARNED CIT(APPEALS). HENCE I REMIT THIS ISSUE TO THE FILE OF THE AO. THE AO IS DIRECTED TO EXAMINE THE VERACITY OF ASSESSEES SUBMISSION REGARDING THE CLAIM OF SALE OF LAND AS AGRICULTURAL LAND SALE. 7. IN THE RESULT, THIS APPEAL FILED BY THE REVENUE STANDS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 19 TH DAY OF SEPT., 2016. SD/ - ( SHAMIM YAHYA) ACCOUNTANT MEMBER. NAGPUR, DATED: 19 TH SEPT., 2016. COPY FORWARDED TO : 1. SHRI DEVIDAS GOVINDRAO KIRPANE, 7, SHASHI BHAWAN, R.M.S. COLONY, OLD SUBHEDAR LAYOUT , NAGPUR - 440024. 2. I.T.O., WARD - 6(2) , NAGPUR. 3. C.I.T. - III , NAGPUR. 4. CIT(APPEALS), - II , NAGPUR. 5. D.R., ITAT, NAGPUR. 6. GUARD FILE TRUE COPY BY ORDER ASSISTANT REGISTRAR, INCOME TAX APPELLATE TRIBUNAL, NAGPUR BENCH, NAGPUR. WAKODE.