Sh. Chuni Lal Bhagat, Jalandhar V. The Income Tax Officer, Jalandhar

ITA 393/ASR/2015

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 0690 (ITAT-AMRITSAR)
• Duration Of Justice: 11 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-06-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2007-2008
• Appeal Filed On: 23-07-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: BHAWANI SHANKER
• Assessee Lawyers: K BHAGAT
• Keywords: Salary income; Revised return; Reassessment proceedings
• Section: 147

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR. (CAMP AT JALANDHAR) BEFORE SH. A.D. JAIN, JUDICIAL MEMBER AND SH. T.S. KAPOOR, ACCOUNTANT MEMBER ITA NO.393(ASR)/2015 ASSESSMENT YEAR:2007-08 PAN: AADPL3986F SH. CHUNI LAL BHAGAT, VS. INCOME TAX OFFICER, 2015, J.P. NAGAR, WARD-1(1), JALANDHAR, JALANDHAR. (APPELLANT) (RESPONDENT) APPELLANT BY: SH.K. BHAGAT, CA RESPONDENT BY: SH. BHAWANI SHANKER, DR DATE OF HEARING: 23/06/2016 DATE OF PRONOUNCEMENT: 28/06/2016 ORDER PER A.D. JAIN, JM; THIS IS THE ASSESSEES APPEAL FOR THE ASSESSMENT Y EAR 2007-08, AGAINST THE ORDER DATED 26.05.2015, PASSED BY THE LD. CIT(A )-1, JALANDHAR. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL : 1. THAT THE ORDER OF WORTHY CIT(A, JALANDHAR DATED 0.5.06.2015 IS AGAINST THE LAW AND FACTS OF THIS CASE. 2. THAT THE WORTHY CIT(A), HAS WRONGLY CONFIRMED TH E ADDITION OF RS.3,37,49,994/- ON ACCOUNT OF LONG TERM CAPITAL GA IN BY RELYING UPON CERTAIN JUDGMENTS QUITE DISTINGUISHABLE FROM T HE CASE OF THE ASSESSEE. 3. THAT THE WORTHY CIT(A), HAS WRONGLY CONFIRMED TH E ADDITION REGARDING AMOUNT OF CONSIDERATION RECEIVED IN ASSES SMENT YEAR 2 ITA NO.393(ASR)/2015 A.Y. 2007-08 2 2008-09 AND NO CREDIT HAS BEEN GIVEN REGARDING TAX PAID AMOUNTING TO RS.11,37,914/- IN ASSESSMENT YEAR 2008 -09 IN THE REVISED RETURN FILED BY THE ASSESSEE. 2. THE FACTS OF THE CASE ARE THAT THE ASSESSEE, BEI NG AN MLA DERIVES INCOME FROM SALARY, PENSION AND AGRICULTURE. HE FILED HIS RETURN OF INCOME ON 31.11.2007 DECLARING THEREIN AN INCOME OF RS.2,98,8 90/- PLUS AGRICULTURAL INCOME OF RS.96,000/- WHICH WAS PROCESSED U/S 143(1 ) OF THE ACT. THE ASSESSEE HAD ALSO FIALED REVISED RETURN ON 30.10.20 09 DECLARING THEREIN AN INCOME OF RS.19,43,830/- PLUS AGRICULTURAL INCOME O F RS.96,000/-. THE REASSESSMENT PROCEEDINGS U/S 147 WERE INITIATED AGA INST THE ASSESSEE, AS THE ASSESSEE HAD NOT DECLARED ENTIRE LONG TERM CAPITAL GAINS ACCRUED TO HIM FROM TRANSFER OF HIS IMMOVABLE PROPERTY. IN RESPONSE TO NOTICE U/S 148, THE ASSESSEE SUBMITTED THAT THE REVISED RETURN FILED BY HIM ON 3 0.10.2009 MAY BE TREATED AS HIS RETURNED FILED IN RESPONSE TO THE SAID NOTICE. THE REASSESSMENT IN THIS CASE WAS COMPLETED BY THE AO VIDE ORDER DATED 13.02.201 5 AT AN ASSESSED INCOME OF RS.3,56,93,826/- PLUS AGRICULTURE INCOME OF RS.9 6,000/-. WHILE COMPLETING ASSESSMENT, THE AO COMPUTED LONG TERM CAPITAL GAINS ACCRUING TO THE ASSESSEE AT RS.3,53,94,940/- AND ADDED IT TO THE ORIGINALLY DECLARED INCOME OF THE ASSESSEE. 3. ON APPEAL, THE LD. CIT(A), CONFIRMED THE ORDER OF THE ASSESSING OFFICER. NOW, AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFORE TH IS BENCH. 3 ITA NO.393(ASR)/2015 A.Y. 2007-08 3 4. AT THE OUTSET, THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ISSUE IN DISPUTE IS SQUARELY COVERED BY THE DECISION OF T HE HONBLE HIGH COURT, IN THE CASE OF C.S. ATWAL VS. THE COMMISSIONER OF INCOME TAX, LUDHIANA AND ANOTHER, VIDE ORDER DATED 22.07.2015, PASSED IN ITA NO.200 OF 2013 (O & M), REPORTED AT 279 ITR 330 (P&H). 5. THE LD. DR, ON THE OTHER, RELIED ON THE IMPUGNED ORDER. 6. HAVING HEARD THE RIVAL CONTENTIONS IN THE LIGHT OF THE MATERIAL PLACED ON RECORD, WE ARE OF THE VIEW THAT THE CASE OF THE AS SESSEE IS SQUARELY COVERED BY THE DECISION OF THE HONBLE HIGH COURT OF PUNJAB & HARYANA IN THE CASE OF CHARANJIT SINGH ATWAL VS. CIT, VIDE ORDER, DATED 22.07.2015, PASSED IN ITA NO.200 OF 2013 (O&N), REPORTED AS 279 CTR 330 (P&H) , WHEREIN, IT HAS BEEN HELD THAT SINCE NO POSSESSION HAD BEEN GIVEN BY THE TRANSFEROR TO THE TRANSFEREE OF THE ENTIRE LAND IN PART PERFORMANCE OF JDA DATED 25.02.2007 SO AS TO FALL WITHIN THE DOMAIN OF SECTION 53A OF THE TRANSFER ACT AND CONSEQUENTLY, SECTION 2(47)(V) OF THE I.T. ACT, DID NOT APPLY, TH AT FURTHER, WILLINGNESS TO PERFORM THEIR PART OF THE CONTRACT WAS ABSENT ON TH E PART OF THE DEVELOPERS, OR IT COULD NOT BE PERFORMED BY THEM, WHICH WAS ONE OF T HE CONDITIONS PRECEDENT FOR APPLYING SECTION 53A OF THE TRANSFER ACT; THAT IN CLAUSE 26 OF THE JDA DATED 25.02.2007, THE PRINCIPLE OF FORCE MAJEURE H AD BEEN PROVIDED FOR, WHICH WOULD BE APPLICABLE WITH FULL VIGOUR IN THE CIRCU MSTANCES; THAT FROM THE CUMULATIVE EFFECT OF THE COVENANTS CONTAINED IN TH E JDA READ WITH THE 4 ITA NO.393(ASR)/2015 A.Y. 2007-08 4 REGISTERED SPECIAL POWER OF ATTORNEY DATED 26.02.2 007, IT COULD NOT BE HELD THAT THE MANDATORY REQUIREMENTS OF SECTION 53A OF T HE TRANSFER ACT WERE COMPLIED WITH, WHICH STOOD INCORPORATED IN SECTION 2(47)(V) OF THE ACT; THAT ONCE THAT WAS SO, IT COULD NOT BE SAID THAT THE AS SESSEES WERE LIABLE TO CAPITAL GAIN TAX IN RESPECT OF THE REMAINING LAND WHICH WAS NOT TRANSFERRED BY THEM TO THE DEVELOPER/BUILDER BECAUSE OF SUPERVISING EVENT AND NOT ON ACCOUNT OF ANY VOLITION ON THEIR PART; AND THAT VIEWED FROM ANOTHE R ANGLE, IT COULD NOT BE SAID THAT ANY INCOME CHARGEABLE TO CAPITAL GAINS TAX IN RESPECT OF THE REMAINING LAND HAD ACCRUED OR ARISEN TO THE ASSESSEE IN THE F ACTS OF THE CASE. 7. THEREFORE, RESPECTFULLY FOLLOWING THE DECISION O F HONBLE HIGH COURT OF PUNJAB & HARYANA IN THE CASE OF CHARANJIT SINGH AT WAL VS. CIT (SUPRA), AS THE FACTS OF THE PRESENT CASE ARE EXACTLY SIMILAR AS TH OSE DECIDED BY THE HONBLE HIGH COURT, THE APPEAL OF THE ASSESSEE IS ALLOWED. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. ORDER PRONOUNCED IN THE OPEN COURT ON 28/ 06/2016. SD/- SD/- (T. S. KAPOOR) (A.D. JAIN) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 28/06/2016. /SKR/ COPY OF THE ORDER FORWARDED TO: (1) THE ASSESSEE:SH. CHUNI LAL BHAGAT, JALANDHA R. (2) THE ITO WARD-1(1), JALANDHAR. (3) THE CIT(A), JLR (4) THE CIT, JLR (5) THE SR DR, I.T.A.T. TRUE COPY 5 ITA NO.393(ASR)/2015 A.Y. 2007-08 5 BY ORDER