Siddharth Garg, Agra V. Dy. C.I.T., Circle - 4(1), Agra

ITA 34/AGR/2012

• Counselvise Citation: 3420314 RSA 2012
• Duration Of Justice: 1 year(s) 10 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-12-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 17-12-2013
• Assessment Year: 2008-2009
• Appeal Filed On: 31-01-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: WASEEM ARSHAD
• Assessee Lawyers: MAHESH AGARWAL
• Section: 143(3); 54B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AGRA BENCH, AGRA BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMMBER AND SHRI PRAMOD KUMAR, ACCOUNTANT MEMBER ITA NO. 34/AGRA/ 2012 ASSESSMENT YEAR2008-09 SIDDHARTH GARG VS. DY. COMMISSIONER OF INCOME-TA X 10, KHANDELWAL COLONY, CIRCLE- 4(1), RING ROAD, AGRA. AGRA. (PAN AEPPG 4246 K) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI MAHESH AGARWAL, C.A. RESPONDENT BY : SHRI WASEEM ARSHAD, SR. D.R. DATE OF HEARING : 17.12.2013 DATE OF PRONOUNCEMENT : 20.12.2013 ORDER PER PRAMOD KUMAR,ACCOUNTANT MEMBER: 1. BY WAY OF THIS APPEAL, THE ASSESSEE-APPELLANT HA S CALLED INTO QUESTION CORRECTNESS OF LEARNED CIT(A)S ORDER DATED 8 TH DECEMBER, 2011, IN THE MATTER OF ASSESSMENT U/S. 143(3) OF THE INCOME TAX ACT 1961 F OR THE ASSESSMENT YEAR 2008- 09, ON THE FOLLOWING GROUNDS:- ITA NO.34/AGRA/2012 A.Y.2008-09 2 1. THAT UNDER THE FACTS AND CIRCUMSTANCES OF THE C ASE AND IN LAW THE LD. AUTHORITIES HAVE ERRED IN DISALLOWANCE U/S 54B OF RS.60,80,000/- AS CLAIMED BY THE APPELLANT IN THEIR RETURN OF INCOME FOR THE RELEVANT ASSESSMENT YEAR. 2. THAT THE LD. AUTHORITIES HAVE ERRED BOTH IN FACT S AND IN LAW TO HOLD THAT SUBJECT LAND WAS NEITHER USED BY THE ASSE SSEE OR HIS PARENTS FOR AGRICULTURAL PURPOSES. LD. AUTHORITIES FURTHER FAILED TO CORRECTLY INTERPRET THE STATUTORY PROVISION AS P RESCRIBED U/S 54B WHICH REQUIRE AGRICULTURAL USE OF THE LAND IN T HE PAST TWO YEARS AND NOT THE DECLARATION OF AGRICULTURAL INCOM ES, AS ALLEGED BY THE LD. AUTHORITIES, FROM THE DECLARATIO N OF AGRICULTURAL INCOMES, AS ALLEGED BY THE LD. AUTHORI TIES, FROM THE LAND IN THE IMMEDIATELY PRECEDING TWO PREVIOUS YEARS. 3. THAT WHILE MAKING THE IMPUGNED DISALLOWANCE THE LD. DCIT HAS GROSSLY ERRED BY IGNORING THE MATERIAL EVIDENCE S ON RECORDS WITHOUT ASSIGNING THE REASONS FOR DOING SO AND HAS GIVEN WEIGHT AND CONSIDERATION TO THE IRRELEVANT AND INCO RRECT SELF IMAGINED FACTS. 4. THAT LD. AUTHORITIES FAILED TO APPRECIATE THAT T HE APPARENT WAS NOT REAL AND THE BURDEN ON REVENUE TO ESTABLISH THE FACT AND BASIS OF CONTENTION COULD NOT BE DISCHARGED IN ABSE NCE OF ANY POSITIVE AND COGENT MATERIAL AND HENCE NO ADVERSE I NFERENCE COULD BE DRAWN AGAINST THE ASSESSEE. 5. THAT THE ADDITIONS HAVE BEEN MADE ON MERE SUSPIC ION. THIS IS A WELL-ESTABLISHED LAW THAT SUSPICIOUS HOWSOEVER STRO NG CANNOT TAKE PLACE OF EVIDENCE AND ADVERSE INFERENCE CANNOT BE TAKEN AGAINST THE ASSESSEE MERELY ON THE BASIS OF SUSPICI OUS. 2. TO ADJUDICATE ON THIS APPEAL, ONLY A FEW MATERIA L FACTS NEED TO BE TAKEN NOTE OF. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, TH E ASSESSING OFFICER NOTED THAT THE ASSESSEE HAS OFFERED LONG TERM CAPITAL GAIN OF RS.14,75,000/- AFTER CLAIMING DEDUCTION OF RS.60,80,000/- U/S. 54B. HOWEVER, THE SAID DEDUCTION U/S 54B, ITA NO.34/AGRA/2012 A.Y.2008-09 3 ACCORDING TO THE ASSESSING OFFICER, WAS NOT AVAILAB LE IN RESPECT OF SALE OF AGRICULTURAL LAND UNLESS THE SAME WAS USED, IN THE TWO YEARS IMMEDIATELY PRECEDING THE YEAR IN WHICH TRANSFER TOOK PLACE, FOR AGRICULT URAL PURPOSES. THE ASSESSING OFFICER WAS OF THE VIEW THAT THERE IS NO EVIDENCE W HATSOEVER OF THE LAND TRANSFERRED ACTUALLY HAVING BEEN USED FOR AGRICULTURAL PURPOSES . ACCORDINGLY, DEDUCTION U/S. 54B WAS DECLINED. AGGRIEVED, ASSESSEE CARRIED THE M ATTER IN APPEAL BEFORE THE CIT(A) BUT WITHOUT ANY SUCCESS. THE ASSESSEE IS NOW IN SECOND APPEAL BEFORE US. 3. LEARNED COUNSEL HAS INVITED OUR ATTENTION TO A D ECISION OF THE COORDINATE BENCH, IN THE CASE OF M.A. ALAGAPPAN VS. I.T.O. (29 ITD 69) WHICH, INTER ALIA , OBSERVES AS FOLLOWS:- IT WAS ARGUED ON BEHALF OF THE REVENUE THAT THIS S ECTION IMPOSED A FURTHER CONDITION THAT THE LAND SHOULD BE USED BY T HE ASSESSEE FOR AGRICULTURAL PURPOSES WITHIN A PERIOD OF TWO YEARS PRIOR TO THE SALE AND IT WOULD NOT BE SUFFICIENT THAT IF THE LANDS AR E FOUND TO BE AGRICULTURAL LANDS, THOUGH REMAINING FALLOW. WE DO NOT THINK THAT PARLIAMENT COULD HAVE INTENDED TO IMPOSE SUCH A RES TRICTION ON THE RELIEF UNDER S. 54B. AS POINTED OUT BY THE SUPREME COURT, ONE OF THE OBJECTS OF THE EXEMPTION IS TO ENCOURAGE CULTIVATIO N. THEREFORE, IT STANDS TO REASON THAT AN ASSESSEE, WHO IS UNABLE TO CULTIVATE THE LAND IN HIS POSSESSION, SHOULD BE ENCOURAGED TO REPLACE IT WITH LAND WHICH HE CAN CULTIVATE. THAT IS WHY THE FINANCE ACT, 1970 , WHILE BRINGING TO TAX AGRICULTURAL LANDS WITHIN THE LIMITS OF A MUNIC IPALITY, SIMULTANEOUSLY GRANTED RELIEF UNDER S. 54B FOR REIN VESTMENT OF THE PROCEEDS. THE EXPRESSION USED FOR AGRICULTURAL PUR POSES IN THIS SECTION COULD ONLY BE THE DESCRIPTION OF THE AGRICU LTURAL LAND WHICH IS THE SUBJECT OF THE TRANSFER AND NOT A CONDITION PRE CEDENT FOR GRANTING THE RELIEF UNDER S. 54B. ITA NO.34/AGRA/2012 A.Y.2008-09 4 4 IT IS THUS CONTENDED THAT THE ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE. LEARNED DEPARTMENTAL REPRESENTATIVE COULD NOT PRODU CE ANY JUDICIAL PRECEDENT TO THE CONTRARY OR POINT OUT ANY GOOD REASONS AS TO WH Y WE SHOULD NOT FOLLOW THE SAID DECISION BY COORDINATE BENCH. A COPY OF THE SAID DE CISION IS DEEMED TO BE ATTACHING TO AND FORMING PART OF THIS MATTER. RESPE CTFULLY FOLLOWING THE SAME, WE UPHOLD THE GRIEVANCE OF THE ASSESSEE AND DIRECT THE A.O. TO GRANT DEDUCTION U/S 54B AS CLAIMED. THE ASSESSEE GETS THE RELIEF ACCORDINGL Y. 5 IN THE RESULT, THE APPEAL IS ALLOWED IN THE TERMS INDICATED ABOVE. (ORDER PRONOUNCED IN THE OPEN COURT) SD/- SD/- (BHAVNESH SAINI) (PRAMOD KUMAR) JUDICIAL MEMBER ACCOU NTANT MEMBER AMIT/ COPY OF THE ORDER FORWARDED TO:- APPELLANT, RESPONDENT, CIT (APPEALS) CONCERNED CIT CONCERNED, D.R., ITAT, AGRA BENCH, AGRA GUARD FILE. BY ORDER SR. PRIVATE SECRETARY INCOME TAX APPELLATE TRIBUNAL, AGRA TRUE COPY