ITO, Rewari V. Mool Chand HUF, Rewari

ITA 4214/DEL/2016

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 1216 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 11 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-07-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Assessment Year: 2006-2007
• Appeal Filed On: 01-08-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Capital asset; TDS
• Section: 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCH: FRIDAY NEW DELHI BEFORE SHRI O.P. KANT, ACCOUNTANT MEMBER AND SHRI KULDIP SINGH, JUDICIAL MEMBER [THROUGH VIDEO CONFERENCING] ITA NO.4214/DEL/2016 ASSESSMENT YEAR: 2006-07 ITO, WARD-2, MODEL TOWN, REWARI VS. MOOL CHAND HUF, C/O- SMT. SHANTI DEVI, W/O- LATE SH. MOOL CHAND, NEAR POLICE STATION, DHARUHERA, REWARI PAN : N.A. (APPELLANT) (RESPONDENT) ORDER PER O.P. KANT, AM: THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST ORDE R DATED 16/05/2016 PASSED BY THE LEARNED COMMISSIONER OF IN COME TAX (APPEALS), ROHTAK (HARYANA) [IN SHORT THE LD. CIT( A)] FOR ASSESSMENT YEAR 2006-07 RAISING FOLLOWING GROUNDS: 1. CIT(A) HAS ERRED IN LAW IN DELETING THE ADDITION OF RS.8,89,12,500/- MADE BY THE AO ON ACCOUNT OF LONG TEMR CAPITAL GAIN, ACCEPTING THE PLEA OF THE ASSESSEE THAT THE P ROTECTIVE ASSESSMENT IN THE NAME OF ALL CO-OWNERS IN THEIR IN DIVIDUAL CAPACITY APPELLANT BY SH. ATIQ AHMED, SR.DR RESPONDENT BY SH. MAHAVIR SINGH, ADV. DATE OF HEARING 02.07.2021 DATE OF PRONOUNCEMENT 09.07.2021 2 ITA NO.4214/DEL/2016 HAVE BEEN MADE AND CONFIRMED BY THE CIT(A). THE CIT (A) HAS DELETED THE ADDITION WITHOUT APPRECIATING THE FACT THAT THE LAND SOLD WAS ANCESTRAL AND BELONGS TO MOOL CHAND, HUF. APPEA L AGAINST THE ORDERS OF THE CIT(A) IN CASE OF CO-OWNERS IN THEIR INDIVIDUAL CAPACITY ARE ALSO PENDING BEFORE THE HONBLE ITAT. 2. WE HAVE HEARD RIVAL SUBMISSION OF THE PARTIES ON TH E ISSUE IN DISPUTE, WHO APPEARED THROUGH VIDEO CONFERENCING FACILITY AND FILED VARIOUS DOCUMENTS ELECTRONICALLY. 2.1 BRIEF FACTS OF THE CASE ARE THAT LATE SH. MOOLCH AND OWNED AN AGRICULTURAL LAND WHICH WAS SITUATED IN MUNICIPAL L IMITS OF DHARUHERA (HARYANA). AN FORMATION WAS RECEIVED BY T HE INCOME TAX DEPARTMENT THAT SAID LAND WAS SOLD BY FIVE PERS ONS, NAMELY, SMT. SHANTI DEVI, SH. AJIT SINGH, SH. SUNIL KUMAR, SMT. SHASHI BALA AND SMT. SAVITA DEVI. THE ASSESSING OFFICER WA S OF THE VIEW THAT AFTER THE DEATH OF SH. MOOLCHAND, THE LAND EXI STED IN THE NAME OF SH. MOOLCHAND HUF, THEREFORE HE REOPENED TH E CASE OF THE ASSESSEE I.E. MOOLCHAND HUF BY WAY OF ISSUE OF NOTICE UNDER SECTION 148 OF THE INCOME-TAX ACT, 1961 (IN SHORT THE ACT) AND ASSESSED THE CAPITAL GAIN ON TRANSFER OF THE LAND I N THE HANDS OF MOOLCHAND HUF ON SUBSTANTIVE BASIS. THE ASSESSING O FFICER ALSO ASSESSED THE SAID CAPITAL GAIN IN THE HAND OF FIVE INDIVIDUALS I.E. SONS AND DAUGHTER OF LATE SH. MOOLCHAND ON PROTECTI VE BASIS. THE FIVE INDIVIDUALS ALONG WITH THE ASSESSEE FILED APPE AL BEFORE THE LD. CIT(A). THE LEARNED CIT(A) TREATED THE INCOME ON TR ANSFER OF LAND ON SUBSTANTIVE BASIS IN THE HANDS OF FIVE INDIVIDUA LS AND DELETED THE ADDITION IN THE HANDS OF THE ASSESSEE, HOLDING THAT NO DOUBLE ADDITION CAN BE MADE FOR THE SAME TRANSACTION. 3 ITA NO.4214/DEL/2016 2.2 BEFORE US, LEARNED COUNSEL OF THE ASSESSEE SUBMITT ED THAT REVENUE HAS NOT PREFERRED ANY APPEAL AGAINST THE OR DER OF THE LEARNED CIT(A) IN THE CASE OF THE FIVE INDIVIDUALS WHERE INCOME ON TRANSFER OF THE LAND HAS BEEN ASSESSED ON SUBSTANTI VE BASIS AND THEREFORE NOW THE REVENUE IS NOT JUSTIFIED IN SEEKI NG ASSESSMENT OF THE SAME INCOME IN THE HANDS OF THE MOOLCHAND HU F ON SUBSTANTIVE BASIS. THE LEARNED COUNSEL ALSO SUBMITT ED THAT AT THE TIME OF THE TRANSFER OF LAND, THE LAND WAS DULY REC ORDED IN THE NAME OF THE FIVE INDIVIDUALS IN THE LAND REVENUE RE CORDS AND THEY HAVE TRANSFERRED THEIR INDIVIDUAL SHARE IN THE LAND TO THE BUYER AND THEREFORE ASSESSMENT OF SAME TRANSACTION IN THE HANDS OF THE ASSESSEE, I.E., THE MOOLCHAND HUF IS WITHOUT ANY EVIDENCE OF OWNERSHIP IN THE HANDS OF HUF AND MERELY BASED O N IMAGINATION OF THE ASSESSING OFFICER. DURING THE HE ARING OF APPEAL BEFORE US, THE LEARNED DR WAS DIRECTED, TO CONFIRM THIS FACT AND FILE GROUNDS OF APPEAL, IF ANY SUCH APPEALS HAVE BE EN PREFERRED BY THE REVENUE IN THE CASE OF THOSE FIVE INDIVIDUALS. DESPITE REPEATED OPPORTUNITIES THE LD. DR FAILED TO PROVIDE DETAILS OF ANY SUCH APPEALS FILED BY THE REVENUE. THESE FIVE INDIVIDUAL S HAVE ONLY FILED APPEAL CHALLENGING THE ADDITION OF LONG-TERM CAPITAL GAIN ON MERIT ONLY AND SUBSTANTIVE NATURE HAS NOT BEEN CHAL LENGED. IN ONE SUCH APPEAL IN THE CASE OF SMT. SAVITA D/O MOOL CHAND IN ITA NO. 2642/DEL/2016 FOR ASSESSMENT AT 2006-07, THE TR IBUNAL ALLOWED THE GROUND CHALLENGING VALIDITY OF THE RE-A SSESSMENT. THE RELEVANT FINDING OF THE TRIBUNAL (SUPRA) IS REPRODU CED AS UNDER: 9. BE THAT AS IT MAY, THE FACT REMAINS THAT IN BOT H THE SETS OF REASONS, THERE IS A REFERENCE TO THE SUBSTANTIVE AS SESSMENT THAT WAS IN THE HANDS OF MOOL CHAND, HUF AND IT IS ONLY CONS EQUENT THERETO THE PROTECTIVE ASSESSMENT WAS SAID TO BE MADE IN TH E HANDS OF THE 4 ITA NO.4214/DEL/2016 ASSESSEE. IT IS, THEREFORE, CLEAR THAT WHEN THE FAC T DOES NOT ADMIT OF ANY DOUBT THAT THE SUBSTANTIVE ASSESSMENT IN THE HA NDS OF MOOL CHAND, HUF ON 28.3.13, IT WOULD NOT HAVE BEEN POSSI BLE FOR THE AO TO RECORD THE REASONS IN THIS CASE ON 26.03.2013. I T SUGGESTS THAT THE REASONS AND THE NOTICE U/S 148 OF THE ACT ARE ANTE DATED OR AT THE LEASE THAT THEY ARE NOT PROPERTY RECORDED. 10. IN THIS SET OF FACTS AND CIRCUMSTANCES, IT IS D IFFICULTY TO SAY THAT THERE WAS PROPER ISSUANCE OF SERVICE OF NOTICE U/S 148 OF THE ACT AND NO RELIANCE COULD BE MADE ON THE REASONS RECORDED I N THIS MATTER. WE, THEREFORE, HOLD THAT THERE IS NO PROPER ISSUEAN CE AND SERVICE OF NOTICE U/S 148 IN THIS MATTER AND CONSEQUENTLY, THE ASSESSMENT ORDER IS LIABLE TO BE QUASHED. APPEAL OF THE ASSESS EE IS ALLOWED ACCORDINGLY. 2.3 IN THE CASE OF ANOTHER INDIVIDUAL SH. AJIT SINGH A LSO, THE TRIBUNAL HAS QUASHED THE RE-ASSESSMENT PROCEEDING I N ITA 4042/DEL/2016, FOLLOWING THE FINDING IN THE CASE OF SMT. SAVITA (SUPRA). 2.4 THUS, WE DERIVE THAT THE REVENUE HAS AT LEAST ACCE PTED INCOME ON SUBSTANTIVE BASIS IN THE HANDS OF THOSE F IVE INDIVIDUALS. IN SUCH CIRCUMSTANCES, THE SAME INCOME CANNOT BE ASSESSED ON SUBSTANTIVE BASIS IN THE HANDS OF THE A SSESSEE. FURTHER, ON PERUSAL OF COPY OF LAND REVENUE RECORD, WHICH IS A COPY DATED 28/03/2006, WHEREIN NAME OF FIVE INDIVID UALS IS RECORDED AS OWNER OF THE LAND. IN VIEW OF THIS DOCU MENT ALSO THOSE FIVE INDIVIDUALS ARE OWNER OF THEIR RESPECTIVE SHAR ES, AND NO EVIDENCE OF ANY OWNERSHIP IN THE HANDS OF MOOLCHAND HUF HAS BEEN FILED BY THE REVENUE BEFORE US. 2.5 IN VIEW OF THE ABOVE FACTS AND CIRCUMSTANCES, W E ARE OF OPINION THAT THE FINDING OF THE LD. CIT(A) ON THE I SSUE IN DISPUTE IS WELL REASONED AND WE DO NOT FIND ANY ERROR IN TH E SAME. ACCORDINGLY, WE DISMISS THE GROUND RAISED BY THE RE VENUE. 3. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMIS SED. ORDER PRONOUNCED IN THE OPEN COURT ON 9 TH JULY, 2021 5 ITA NO.4214/DEL/2016 SD/- SD/- ( KULDIP SINGH ) ( O.P. KANT ) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 9 TH JULY, 2021. RK/- (DTDS) COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ASST. REGISTRAR, ITAT, NEW DELHI