Shri Kanubhai Shamalbhai Patel, Gandhinagar V. The Income Tax Officer, Ward-2, Gandhinagar

ITA 3662/AHD/2015

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 8317 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 4 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-05-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2011-2012
• Appeal Filed On: 30-12-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Principle of natural justice; Additional evidence
• Section: 54F

Judgement Text

, . . , IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, AHMEDABAD , , BEFORE SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER & MS. MADHUMITA ROY, JUDICIA L MEMBER 1. ./ I.T.A. NO.3662/AHD/2015 2. ./ I.T.A. NO.3663/AHD/2015 ( / ASSESSMENT YEAR : 2011-12 ) 1-2. KANUBHAI SAHAMALBHAI PATEL PLOT NO.201/2 SURYANARAYAN SOCIETY SECTOR-25 GANDHINAGAR / VS. 1-2. THE I.T.O. WARD-2 GANDHINAGAR % ./ ./ PAN/GIR NO. : ABOPP 6909 Q ( %( / APPELLANT ) .. ( )%( / RESPONDENT ) %(* / APPELLANT BY : SHRI M.K. PATEL, AR )%( +* / RESPONDENT BY : SHRI SAURABH SINGH, SR.DR ,- + / DATE OF HEARING 02/05/2018 ./01 + / DATE OF PRONOUNCEMENT 08/05/2018 / O R D E R PER MS. MADHUMITA ROY - JM: BOTH THE APPEALS PREFERRED BY THE SAME ASSESSEE ARE DIRECTED AGAINST THE SEPARATE ORDERS OF THE CIT(A)-GANDHINAG AR, AHMEDABAD DATED 28/09/2015 PASSED FOR THE ASSESSMENT YEAR ( AY) 2011-12. ITA NOS.3662 & 3663/AHD/2015 KANUBHAI SAHAMALBHAI PATEL VS. ITO ASST.YEAR 2011-12 - 2 - 2. SINCE BOTH THE APPEALS ARE INTER-CONNECTED, THESE ARE BEING DISPOSED OF BY WAY OF A CONSOLIDATED ORDER FOR THE SAKE OF C ONVENIENCE. 3. FIRST WE SHALL TAKE UP THE ASSESSEES APPEAL IN ITA NO.3662/AHD/2015 FOR AY 2011-12 WHERE THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL:- (1) THAT ON FACTS AND IN LAW THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS GRIEVOUSLY ERRED IN REJECTING THE PLEA FOR ADMISSION OF ADDITIONAL EVIDENCE. (2) THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL S) HAS GRIEVOUSLY ERRED IN CONFIRMING THE ADDITION OF LONG TERM CAPITAL GAINS OF RS.16,60,423/- IGNORING THE FACT THAT THE APPELLANT COULD BE TAXED ONLY FOR HIS SHARE. 4. BRIEF FACTS OF THE CASE IS THIS THAT THE ASSESSE E HAS FILED ITS RETURN OF INCOME FOR THE YEAR UNDER APPEAL ON 31.01.2011 DECL ARING TAXABLE INCOME OF RS.3,10,210/- WHICH WAS PROCESSED U/S.143(1) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS 'THE ACT'). THERE AFTER, THE CASE WAS SELECTED FOR SCRUTINY THROUGH CASS AND STATUTORY NO TICES WERE ISSUED AND WERE SERVED UPON THE ASSESSEE. AS PER THE DETAILS AVAILABLE IN CASS, THE ITA NOS.3662 & 3663/AHD/2015 KANUBHAI SAHAMALBHAI PATEL VS. ITO ASST.YEAR 2011-12 - 3 - ASSESSEE HAS SOLD IMMOVABLE PROPERTY OF RS.83,90,00 0/- BUT HAD NOT SHOWN ANY INCOME UNDER THE HEAD INCOME FROM CAPITA L GAIN. DETAILS OF THE SAID TRANSACTION WERE CALLED FOR BY THE ASSESSI NG OFFICER (AO) AND UPON VERIFICATION OF THE SALE-DEED, IT WAS NOTICED BY THE AO THAT THE ASSESSEE HAD RECEIVED AN AMOUNT OF RS.33,56,000/- B EING 2/5 TH SHARE OF THE TOTAL CONSIDERATION. THE ASSESSEE CONTENDED BE FORE THE AO THAT THE DISTRIBUTION OF HIS LATE FATHERS SHARE WERE MADE T O HIS BROTHERS AND MOTHER. HOWEVER, SUCH CONTENTION WAS NOT ACCEPTED BY THE AO SINCE IT WAS NOT MENTIONED IN THE AGREEMENT RELIED UPON BY T HE ASSESSEE. OBSERVING THAT NO DOCUMENTARY EVIDENCE WAS SUBMITTE D BY THE ASSESSEE IN SUPPORT OF HIS CONTENTION MADE IN THE FORM OF AN Y LEGAL DOCUMENT, THE AO REWORKED 54F OF THE ACT AND TAXABLE LONG TERM C APITAL GAIN (LTCG) WAS WORKED OUT AT RS.16,60,423/-. 5. THE ASSESSEE PREFERRED APPEAL AGAINST THE SAID ORDER BEFORE THE LD.CIT(A) AND THE LD.CIT(A) DISMISSED THE SAME AFFI RMING THE ORDER PASSED BY THE AO. 6. WE HAVE HEARD BOTH THE REPRESENTATIVES OF THE PA RTIES FOR THE ASSESSEE AS WELL AS FOR THE REVENUE. WE HAVE PERUS ED THE RELEVANT MATERIAL AVAILABLE ON RECORDS. WE HAVE GONE THROUG H THE ORDERS PASSED BY THE LD.CIT(A). WE FIND THAT DURING THE APPELLAT E PROCEEDINGS, THE ASSESSEE MADE A WRITTEN SUBMISSION STATING THAT THE ASSESSEE MADE ITA NOS.3662 & 3663/AHD/2015 KANUBHAI SAHAMALBHAI PATEL VS. ITO ASST.YEAR 2011-12 - 4 - REPRESENTATION TO THE AO CONTENDING THAT ADDITIONAL 1/5 TH SHARE RELATED TO LATE FATHER OF THE ASSESSEE IN THE HANDS OF THE ASS ESSEE COULD BE AN ASSET OF HUF AND NOT INDIVIDUAL. THE ASSESSEE FURTHER ADDED THAT BEFORE MAKING ADDITION, NO OPPORTUNITY WAS GIVEN BY THE AO TO TH E ASSESSEE EITHER TO MAKE AFFIDAVIT TO CLEAR THE FACT, NOR THE AO ISSUED ANY SHOW-CAUSE NOTICE TO THE ASSESSEE FOR FURTHER CLARIFICATION. HOWEVER, ADDITIONAL DOCUMENTS IN SUPPORT OF THE CLAIM OF THE ASSESSEE B EING THE AFFIDAVIT AFFIRMED ON 18.08.2015 AS WELL AS THE PHOTOCOPY OF THE PASSBOOK THROUGH WHICH THE ASSESSEE HAS DISTRIBUTED THE AMOUNT TO OT HER FAMILY MEMBERS WERE SUBMITTED BEFORE THE LD.CIT(A) UPON WHICH NO D ELIBERATIONS HAVE BEEN MADE BY THE LD.CIT(A) AND THEN CONFIRMED THE O RDER PASSED BY THE AO. WE FIND SOME MERIT IN THE PLEA ADVANCED ON BE HALF OF THE ASSESSEE THAT THE ORDER PASSED BY THE CIT(A) IS IN VIOLATION OF PRINCIPLES OF NATURAL JUSTICE. 7. IN THAT VIEW OF THE MATTER, WE ARE INCLINED TO REMIT THE MATTER BACK TO THE FILE OF LD.CIT(A) WITH A DIRECTION TO DECIDE TH E ISSUE RAISED BY THE ASSESSEE ON MERIT AFTER CONSIDERING THE ADDITIONAL DOCUMENTS SUBMITTED BY THE ASSESSEE AND UPON GIVING REASONABLE AND PROP ER OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. IT IS NEEDLESS TO MEN TION THAT THE ASSESSEE SHOULD CO-OPERATE IN THE APPELLATE PROCEEDINGS AS A ND WHEN CALLED FOR BY THE LD.CIT(A). ITA NOS.3662 & 3663/AHD/2015 KANUBHAI SAHAMALBHAI PATEL VS. ITO ASST.YEAR 2011-12 - 5 - 8. IN THE RESULT, ASSESSEES APPEAL IN ITA NO.3662/ AHD/2015 FOR AY 2011-12 IS ALLOWED FOR STATISTICAL PURPOSES. ASSESSEES APPEAL IN ITA NO.3663/AHD/2015 FOR AY 20 11-12. 9. THIS APPEAL PREFERRED BY THE ASSESSEE IS DIRECT ED AGAINST THE ORDER OF THE CIT(A)-GANDHINAGAR, AHMEDABAD DATED 28/09/20 15 FOR AY 2011- 12 ARISING OUT OF THE PENALTY ORDER DATED 25/07/201 4 WHEREBY AND WHEREUNDER PENALTY OF RS.3,44,132/- HAS BEEN LEVIED AGAINST THE ASSESSEE. SINCE THE QUANTUM PROCEEDINGS HAVE NOT ACHIEVED FIN ALITY AND IN VIEW OF THE FACT THAT APPELLATE ORDER OF CIT(A) IN QUANTUM PROCEEDINGS HAVE BEEN SET ASIDE FOR FRESH ADJUDICATION, THE PENALTY ORDER U/S.271(1)(C) DOES NOT SURVIVE. THE IMPUGNED PENALTY ORDER PASSED BY AO U /S.271(1)(C) IS THUS SET ASIDE AND QUASHED. THE AO SHALL BE AT LIBERTY TO PASS FRESH ORDER UNDER S.271(1)(C) IN THE LIGHT OF QUANTUM PROCEEDIN GS IF HE SO CONSIDERS IT EXPEDIENT, IN ACCORDANCE WITH LAW. 10. IN THE RESULT, ASSESSEES APPEAL IN ITA NO.3663 /AHD/2015 FOR AY 2011-12 IS ALSO ALLOWED FOR STATISTICAL PURPOSES. 11. IN THE COMBINED RESULT, ASSESSEES APPEAL IN IT A NO.3662/AHD/2015 FOR AY 2011-12 IS ALLOWED FOR STA TISTICAL PURPOSES. ITA NOS.3662 & 3663/AHD/2015 KANUBHAI SAHAMALBHAI PATEL VS. ITO ASST.YEAR 2011-12 - 6 - SIMILARLY, ASSESSEES APPEAL IN ITA NO.3663/AHD/20 15 FOR AY 2011-12 IS ALSO ALLOWED FOR STATISTICAL PURPOSES. THIS ORDER PRONOUNCED IN OPEN COURT ON 08 /05/2018 SD/- SD/- ( ) ( ) ( PRADIPKUMAR KEDIA ) ( MS. MADHUMITA ROY ) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED 08/ 05 /2018 5 ..,,. ,../ T.C. NAIR, SR. PS !'#' / COPY OF THE ORDER FORWARDED TO : 1. %( / THE APPELLANT 2. )%( / THE RESPONDENT. 3. 67 8 / CONCERNED CIT 4. 8 ( ) / THE CIT(A)-GANDHINAGAR, AHMEDABAD 5. 9:; ,7 , 7 1 , 6 / DR, ITAT, AHMEDABAD 6. ;=>- / GUARD FILE. / BY ORDER, )9 //TRUE COPY// / ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD 1. DATE OF DICTATION .. 3.5.18 (DICTATION-PAD 13- P AGES ATTACHED AT THE END OF THIS APPEAL-FILE) 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 3.5.18 3. OTHER MEMBER 4. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S.. 5. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 6. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S.8.5.18 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 8.5.18 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK ... 9. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 10. DATE OF DESPATCH OF THE ORDER