Mir Sarif, Bhubaneswar V. ITO, Ward-2(4), Bhubaneswarer

ITA 451/CTK/2017

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 4030 (ITAT-CUTTACK)
• Duration Of Justice: 8 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-08-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 09-08-2018
• Assessment Year: 2013-2014
• Appeal Filed On: 22-11-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: S K AGRAWALLA
• Keywords: Capital asset
• Section: 2(14); 142(1)

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL CUTTACK BENCH CUTTACK BEFORE SHRI N.S.SAINI, AM & SHRI PA V AN KUMAR GADALE, JM . / ITA NO. 451 /CTK/201 7 ( [ [ / ASSESSMENT YEAR : 20 13 - 20 14 ) MIR SARIF, MAIN ROAD, JADUPUR, BHUBANESWAR - 751019 VS. ITO, WARD - 2(4), BHUBANESWAR ./ ./ PAN/GIR NO. : EXZPS 8206 Q ( / APPELLANT ) .. ( / RESPONDENT ) [ /AS SESSEE BY : SHRI S.K.AGRAWALLA , AR /REVENUE BY : SHRI SUBHENDU DATTA , DR / DATE OF HEARING : 0 9 / 0 8 /201 8 / DATE OF PRONOUNCEMENT 10 / 0 8 /201 8 / O R D E R PER SHRI PA V AN KUMAR GADALE, JM : TH IS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF CIT( A) - 1 , BHUBANESWAR , DATED 24.08.2017 PASSED IN I.T.APPEAL NO. 0500 / 15 - 16 FOR THE ASSESSMENT YEAR 201 3 - 1 4 . 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL : - 1. THAT, THE LD. AUTHORITIES BELOW WRONGLY INTERPRETED THE PROVISIONS OF SECTION 2(14) OF THE ACT AND WRONG IN HOLDING THAT THE AGRICULTURAL LAND SO SOLD BY THE APPELLANT AS IS A CAPITAL ASSET WITHIN THE MEANING OF SECTION 2(14) OF THE ACT AND THEREFORE THE LONG TERM CAPITAL GAIN ARISING FROM TRANSFER OF THE AGRICULTURAL LAND IS NOT TAXABLE. 2. THAT, THE LD. ASSESSING OFFICER IS WRONG IN IMPOSING THE TAX OF 53,52,410 AS LONG TERM CAPITAL GAIN TAX IN VIEW OF THE FACT THAT THE ASSET SO SOLD IS NOT A CAPITAL ASSET WITHIN THE MEANING OF THE PROVISIONS OF SECTION 2(14) OF THE ACT AND THE LD. COMM ISSIONER OF INCOME TAX (APPEALS) IS WRONG IN HOLDING THAT THE AGRICULTURAL LAND SO SOLD IS A CAPITAL ASSET AND THE PROFITS AND GAIN ARISING FROM TRANSFER OF AGRICULTURAL LAND IS TAXABLE UNDER THE HEAD CAPITAL GAIN THEREFORE IMPOSITION OF TAX IS ILLEGAL AND LIABLE TO BE DELETED. ITA NO. 451 /CTK/201 7 2 3. THAT, THE LD. COMMISSIONER OF INCOME TAX (APPEALS) IS NOT CORRECT IN ENHANCING THE INCOME OF THE APPELLANT AND WRONG IN TREATING THE ON MONEY RECEIVED FROM TRANSFER OF AGRICULTURAL LAND IS TAXABLE AS INCOME FROM OTHER SOURCES. T HEREFORE THE ENHANCEMENT OF INCOME IS LIABLE TO BE DELETED. 4. THAT, THE APPELLANT CRAVES TO ALTER, AMEND, MODIFY OR ADD ANY OTHER GROUND THAT MAY BE CONSIDERED NECESSARY IN THE COURSE OF APPEAL PROCEEDING. . 3. BRIEF FACTS OF THE CASE ARE THAT ASSESSEE FILED THE RETURN OF INCOME FOR THE ASSESSMENT YEAR 201 3 - 201 4 ON 06.05.2014 DISCLOSING TOTAL INCOME AT RS. 3,22,140/ - . SUBSEQUENTLY, THE CASE WAS SELECTED FOR SCRUTINY UNDER CASS AND NOTICES U/S.143(2) & 142(1) OF THE ACT WERE ISSUED TO THE ASSESSEE. IN COMP LIANCE, LD. AR OF THE ASSESSEE APPEARED AND THE CASE WAS DISCUSSED. THEREAFTER THE AO COMPLETED THE ASSESSMENT U/S.143(3) OF THE ACT MAKING ADDITION AND PASSED ORDER DATED 29.02.2016 4. AGGRIEVED BY THE ORDER OF AO, THE ASSESSEE FILED AN APPEAL BEFORE THE CIT(A). IN THE APPELLATE PROCEEDINGS, LD. AR OF THE ASSESSEE REITERATED THE SUBMISSIONS AS WAS MADE BEFORE THE AO AND THE CIT(A) CONSIDERING THE SUBMISSION OF THE ASSESSEE AND FINDINGS OF AO, HAS ENHANCED THE ASSESSMENT . 5. AGAINST THE ORDER OF CIT(A), THE ASSESSEE IS IN FURTHER APPEAL BEFORE US. 6. LD. AR BEFORE US SUBMITTED THAT THE CIT(A) ERRED IN ENHANCING THE INCOME AND TAXING THE INCOME FROM OTHER SOURCES AND ALSO OVERLOOKED THE FACT THAT THE INCOME IS OF THE AGRICULTURE LAND. LD.AR FURTHER SUBMI TTED THAT THE APPLICATION OF GOOGLE MAP / AERIALLY U/S.2(14)(B) OF THE ACT IS EFFECTIVE FROM 2014 - 2015, WHEREAS THE ASSESSMENT YEAR IN RELATION TO THE ASSESSEE IS 2013 - 2014 FOR CALCULATING THE DISTANCE OF AGRICULTURE LAND. LD. AR ALSO ITA NO. 451 /CTK/201 7 3 SUBMITTED THE DETAILS OF OTHER C O - OWNERS WHO HAVE SOLD THE LAND AND ALSO SUBSTANTIATED WITH THE PAPER BOOK EVIDENCING THE REPORT IN RESPECT OF DISTANCE OF AGRICULTURE LAND AND PRAYED FOR ALLOWING THE APPEAL. 7. CONTRA, L D. DR RELIED ON THE ORDERS OF LOWER AUTHORITIES. 8. WE HAVE HEARD R IVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. THE SOLE CONTENTION OF THE LD. AR THAT THE ASSESSEE HAS SOLD THE AGRICULTURE LAND ALONG WITH CO - OWNER AND THE DEPOSITS IN THE BANK REPRESENTS THE AGRICULTURAL RECEIPTS AND THEY ARE NOT LIABLE FOR PAYMENT OF TAX. LD. AR FURTHER ENVISAGED THAT THE LAND IS SITUATED BEYOND THE LIMIT PRESCRIBED UNDER THE PROVISIONS OF SECTION 2(14)(B) OF THE ACT AND ALSO NEW AMENDMENT TO THE PROVISION HAS BEEN INTRODUCED FROM THE ASSESSMENT YEAR 2014 - 2015 AND FURTHER DEMONSTR ATED BEFORE US THAT THE DISTANCE OF AGRICULTURAL LAND FROM BHUBANESWAR MUNICIPAL CORPORATION IS 9 KM BY ROAD AND, THEREFORE, ASSESSEE SATISFIES THE CONDITION FOR CLAIM OF EXEMPTION OF AGRICULTURAL LAND AS PER LAW. WHEN THE QUERY WAS RAISED BY THE BENCH AS TO WHETHER THIS CER TIFICATE PROVIDED TO THE ASSESSING OFFICER, THE EXPLANATION OF LD. AR WAS NOT SATISFACTORY. WE FOUND THE ASSESSMENT ORDER WAS PASSED U/S.143(3) OF THE ACT ON 29.02.2016, WHEREAS THE OFFICE LETTER OF THE REVENUE INSPECTOR REFERRED BY LD. AR AT PAGE 20 OF T HE PAPER BOOK IS DATED 30.03.2016 , ON COMPARING THE DATES, WE ARE OF THE FIRM OPINION THAT THIS LETTER WAS NOT AVAILABLE TO THE ASSESSING OFFICER FOR PURPOSE OF DETERMINING THE NATURE OF LAND. FURTHER, WE FOUND STRENGTH IN THE ARGUMENTS OF THE LD. AR THAT THE PROVISIONS OF SECTION 2(14)III)(B) OF ITA NO. 451 /CTK/201 7 4 THE ACT WAS AMENDED FOR CALCULATION OF DISTANCE AERIALLY FROM 01.04.2014. SECTION 2(14)(III)(B) READS AS UNDER : - 2(14)(III)(B) IN ANY AREA WITHIN THE DISTANCE, MEASURED AERIALLY, (I) NOT BEING MORE THAN TWO KI LOMETRES, FROM THE LOCAL LIMITS OF ANY MUNICIPALITY OR CANTONMENT BOARD REFERRED TO IN ITEM (A) AND WHICH HAS A POPULATION OF MORE THAN TEN THOUSAND BUT NOT EXCEEDING ONE LAKH; OR (II) NOT BEING MORE THAN SIX KILOMETRES, FROM THE LOCAL LIMITS OF ANY MUNI CIPALITY OR CANTONMENT BOARD REFERRED TO IN ITEM (A) AND WHICH HAS A POPULATION OF MORE THAN ONE LAKH BUT NOT EXCEEDING TEN LAKH; OR (III) NOT BEING MORE THAN EIGHT KILOMETRES, FROM THE LOCAL LIMITS OF ANY MUNICIPALITY OR CANTONMENT BOARD REFERRED TO IN ITEM (A) AND WHICH HAS A POPULATION OF MORE THAN TEN LAKH. WE FOUND THE SUBMISSION S OF THE ASSESSEE AND THE EVIDENCE FILED BY WAY OF PAPER BOOK, I.E. THE LETTER DATED 30.03.2016 IS CRUCIAL FOR DETERMINING THE NATURE OF LAND AND WAS NOT A VAILABLE WITH THE AO AND THE AO WAS ALSO DEPRIVED TO VERIFY AND EXAMINE THE SAME. ACCORDINGLY, IN THE INTEREST OF SUBSTANTIAL JUSTICE, WE REMIT THIS DISPUTED ISSUE TO THE FILE OF AO TO CONSIDER THE EVIDENCE FILED BEFORE US AND PASS ORDER IN ACCORDANCE WIT H LAW AFTER PROVIDING ADEQUATE OPPORTUNITY OF HEARING TO THE ASSESSEE. 9 . IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES . O RDER PRONOUNCED IN THE OPEN COURT ON THIS 10 / 0 8 / 201 8 . SD/ - ( N.S.SAINI ) SD/ - ( PAVAN KUMAR GADALE ) / ACCOUNTANT MEMBER / JUDICIAL MEMBER CUTTACK ; DATED 10 / 0 8 /201 8 . . / PKM , SENIOR PRIVATE SECRETARY ITA NO. 451 /CTK/201 7 5 / COPY OF THE ORDER FORWARDED TO : / BY ORDER, ( SENIOR PRIVATE SECRETARY ) , / ITAT, CUTTACK 1. / THE APPELLANT - MIR S ARIF, MAIN ROAD, JADUPUR, BHUBANESWAR - 751019 2. / THE RESPONDENT - ITO, WARD - 2(4), BHUBANESWAR 3. ( ) / THE CIT(A) 4. / CIT 5. , , / DR, ITAT, CUTTACK 6. [ / GUARD FILE. //TRUE COPY//