Shri.Nikesh Nalinkant Gujjar , Bagalkot V. Income Tax Officer Ward-1 , Bagalkot

ITA 454/BANG/2018

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 4668 (ITAT-BANGALORE)
• Duration Of Justice: 3 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-06-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 16-02-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR MANOJ KUMAR G
• Keywords: Opportunity of being heard
• Section: 28; 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH : BANGALORE BEFORE SHRI. SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI. INTURI RAMA RAO , ACCOUNTANT MEMBER ITA NO. 454 /BANG/201 8 ASSESSMENT YEAR : 2010 - 11 SHRI. NIKESH NALINKANT GUJJAR, V T GUJJAR COMPOUND, BASAVESHWAR CIRCLE, NEAR JANATA BAZAR, STATION ROAD, BAGALKOT. PAN : AOEPG 9683 D VS. THE INCOME-TAX OFFICER, WARD 1, BAGALKOT. APPELLANT RESPONDENT ASSESSEE BY : SHRI. B ALACHANDRAN, ADVOCATE REVENUE BY : DR. MANOJ KUMAR G , ADDL. CIT DATE OF HEARING : 0 4 . 0 6 .201 8 DATE OF PRONOUNCEMENT : 08 . 0 6 .201 8 O R D E R PER SUNIL KUMAR YADAV, JUDICIAL MEMBER THIS APPEAL IS PREFERRED BY THE ASSESSEE AGAINST THE ORDER OF THE CIT(A), INTER ALIA , ON FOLLOWING GROUNDS: (1) IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(APPEALS) ERRED IN NOT APPRECIATING THE FACTS OF THE CASE AND DENYING EXEMPTION UNDER SECTION 10(37) OF THE I.T. ACT, 1961, IN THE LIGHT OF THE HON'BLE SUPREME COURT DECISION IN THE CASE OF CIT V. GHANSHYAM (HUF) 315 ITR 1 (SC) (2) IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(APPEALS) ERRED IN UPHOLDING THE ACTION OF THE AO IN TAXING THE INTEREST UNDER SECTION 28 OF THE LAND ACQUISITION ACT, 1894, UNDER ITA NO. 454/BANG/2018 PAGE 2 OF 3 SECTION 56(2)(VIII) OF THE I.T. ACT, 1961 THOUGH IT IS NOT A INTEREST COVERED BY THE SAID PROVISIONS OF THE I.T. ACT, 1961 (3) IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(APPEALS) ERRED IN IGNORING THE DECISION OF ITAT, PANAJI BENCH, PANAJI IN THE CASE OF THE CHIEF ACCOUNTS OFFICER, LA, UPPER KRISHNA PROJECT, BAGALKOT IN ITA NO.64/PNJ/2011 FOR A.Y. 2009-10 DATED 13.4.2011 WHEREIN, IT WAS HELD THAT INTEREST UNDER SECTION 28 OF THE LAA, 1894, IS AN ACCRETION TO THE VALUE AND HENCE IT IS PART OF ENHANCED COMPENSATION AND AS SUCH, PROVISIONS OF SECTION 194L ARE NOT APPLICABLE IN RESPECT OF INTEREST U/S 28 OF THE LAA, 1894 IS CONCERNED. (4) THE APPELLANT PRAYS FOR HIS RELIANCE ON THE DECISION OF HON'BLE GUJARAT HIGH COURT IN MOVALIYA BHIKHUBHAI BALABHAI VS. ITO (TDS) AND ANOTHER 388 ITR (2016) 343 (GUJ), WHEREIN, IT WAS HELD THAT THE INTEREST UNDER SECTION 28 OF THE LAA, 1894, IS NOT INTEREST REFERRED TO IN SECTION 56(2)(VIII) OF THE I.T. ACT, 1961. (5) THE APPELLANT FURTHER PRAYS FOR RELIANCE ON THE DECISION OF ITAT, IN THE CASE SHRI. MALLANGOUDAR SHANKARGOUDA NAGANAGOUDAR , BILAGI BAGALKOT, THE HON'BLE ITAT, BENGALURU BENCH VIDE ITS ORDER IN ITA NO.1120(B)/2015 DT 30/12/15 RELYING ON THE DECISION IN THE CASE OF CIT VS. GHANSHYAM (HUF) CONCLUDED THAT INTEREST U/S.28 IS A PART OF THE COMPENSATION AND INTEREST U/S.34 IS CHARGEABLE AS REVENUE RECEIPT. (6) WITHOUT PREJUDICE TO THE ABOVE, THE LEARNED CIT(APPEALS) ERRED IN IGNORING HIS AWN DECISION IN THE CASE OF SMT.RESHMA K DOSHI, BAGALKOT IN ITAT NO.388/CIT(A)/BGM/2012-13 DATED 29.12.2017 FOR A.Y. 2010-11, WHEREIN, ON SIMILAR IDENTICAL ISSUE, ADDITION MADE BY THE ASSESSING OFFICER HAS BEEN DELETED. (7) THE APPELLANT PRAYS TO ADD, ALTER OR AMEND ANY OF THE FOREGOING GROUNDS OF APPEAL AT THE TIME OF HEARING. 2. DURING THE COURSE OF HEARING, OUR ATTENTION WAS INVITED TO THE FACT THAT THE CIT(A) HAS DISPOSED OFF THE APPEAL EX-PARTE WITHOUT AFFORDING PROPER OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. THEREFORE, THE ORDER OF THE CIT(A) IS SET ASIDE AND MATTER BE RESTORED BACK TO HIS FILE WITH A DIRECTION TO READJUDICATE THE APPEAL AFRESH AFTER AFFORDING PROPER OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. THE LEARNED DR PLACED RELIANCE UPON THE ORDER OF THE CIT(A). ITA NO. 454/BANG/2018 PAGE 3 OF 3 3. HAVING CAREFULLY PERUSED THE ORDER OF THE CIT(A), WE FIND THAT CIT(A) HAS RECORDED FEW DATES OF HEARING IN HIS ORDER BUT IT IS NOT CLEAR FROM HIS ORDER AS TO WHETHER THE NOTICE OF HEARING WAS EVER SERVED UPON THE ASSESSEE. WE THEREFORE SET ASIDE THE ORDER OF THE CIT(A) AND RESTORE THE MATTER TO HIS FILE WITH A DIRECTION TO READJUDICATE THE APPEAL AFRESH AFTER AFFORDING OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 4. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON 08 TH JUNE, 2018. SD/- SD/- BANGALORE. DATED: 08 TH JUNE, 2018. /NS/* COPY TO: 1. APPELLANTS 2. RESPONDENT 3. CIT 4. GUARD FILE BY ORDER SR. PRIVATE SECRETARY, ITAT, BANGALORE. ( INTURI RAMA RAO ) (SUNIL KUMAR YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBER