SMT. TRAPTI AGRAWAL, Indore V. The ACIT 5(1), Indore

ITA 458/IND/2014

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 5697 (ITAT-INDORE)
• Duration Of Justice: 2 year(s) 4 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-10-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 20-09-2016
• Assessment Year: 2008-2009
• Appeal Filed On: 10-06-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MOHD JAVED
• Assessee Lawyers: GIRISH AGRAWAL
• Keywords: Capital asset; Additional evidence; Accommodation entries; Competent authority

Judgement Text

SMT. TRAPTI AGRAWAL ITA NO. 458/IND/2014 1 , , IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE .., ..!', #$ # !% BEFORE SHRI D.T. GARASIA, JUDICIAL MEMBER AND SHRI O.P. MEENA, ACCOUNTANT MEMBER I.T.A. NO. 458/IND/2014 ASSESSMENT YEAR: 2008-09 SMT. TRAPTI AGRAWAL INDORE PAN ABTPG 6999C :: APPELLANT VS ACIT 5(1) INDORE :: RESPONDENT /APPELLANT BY SHRI GIRISH AGRAWAL RESPONDENT BY SHRI MOHD. JAVED ! DATE OF HEARING 20.9.2016 '#$% ! DATE OF PRONOUNCEMENT 20.10.2016 ' O R D E R PER SHRI D.T. GARASIA, JM THIS APPEAL HAS BEEN PREFERRED BY THE ASSESSEE AGAINST THE ORDER OF THE LEARNED CIT(A)-II, INDORE, DATED 27. 2.2014. SMT. TRAPTI AGRAWAL ITA NO. 458/IND/2014 2 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS AN INDIVIDUAL DOING THE BUSINESS IN THE NAME AND STYLE OF M/S SUBHASH ENTERPRISES AS C&F AGENT FOR M/S RANE BRAKE LININGS LIMITED, CHENNAI. DURING THE COURSE OF ASSESS MENT PROCEEDINGS IT WAS FOUND THAT THE ASSESSEE HAS SOLD RUR AL AGRICULTURAL LAND SITUATED BEYOND THE LIMITS OF INDORE MUNICIPALITY DURING THE YEAR LOCATED AT GRAM BOCHOLI HAPSI, PATWARI HALKA NO. 25, SURVEY NO. 16 & 17 PAKI AND CLAIMED THE LONG TERM CAPITAL GAIN ON THE SAME TRANSACTION AS EXEMPT IN THE SUM OF RS.22,36,790/-. THE ASSESSI NG OFFICER WAS OF THE VIEW THAT THIS LAND IS WITHIN 8 KMS FROM MUNICIPALITY, THEREFORE, IT IS A CAPITAL ASSET. THEREF ORE, THE ASSESSING OFFICER HAS DISALLOWED LONG TERM CAPITAL GAIN . 3. DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER OBTAINED LETTER FROM TEHSILDAR DATED 23.11.2010 AND HELD THAT THE ASSESSEE IS LIABLE FOR LON G TERM CAPITAL GAIN ON SALE OF AGRICULTURAL LAND AND HE SMT. TRAPTI AGRAWAL ITA NO. 458/IND/2014 3 ACCORDINGLY MADE THE ADDITION. THE LEARNED CIT(A) CONFIRMED THE ADDITION WITH THE FOLLOWING OBSERVATIO NS :- I HAVE GONE THROUGH THE DETAILED REASONS BROUGHT OUT BY THE A.O. IN THE ASSESSMENT ORDER AND REMAND REPORT. I HAVE ALSO GONE THROUGH THE WRITTEN SUBMIS SIONS OF THE APPELLANT ON THE ISSUE, ADDITIONAL EVIDENCES AND COMMENTS ON THE REMAND REPORT OF A.O. WHICH ARE REPRODUCED ABOVE. THE A.O. HAS DISCUSSED THE ISSUE OF DISTANCE OF LAND FROM INDORE MUNICIPALITY ELABORATE LY AND CONCLUSIVELY. THE TEHSILDAR IS COMPETENT AUTHOR ITY TO CERTIFY THE DISTANCE OF KHASRA NO. OF ANY LAND F ROM MUNICIPAL LIMITS. THE A.O. HAS DULY OBTAINED THE CERTIFICATE FROM THE TEHSILDAR, INDORE. THERE IS NO REASON WHY THE ADDITIONAL EVIDENCE ON THIS ISSUE OBTAINED FROM SOME OTHER AUTHORITIES, NOT COMPETENT TO ISSUE SUCH CERTIFICATES SHOULD BE ACCEPTED. THE REMAND REPORT OF A.O. IS MORE THAN CLEAR TO BRING OUT THAT SUFFICIEN T SMT. TRAPTI AGRAWAL ITA NO. 458/IND/2014 4 OPPORTUNITIES WERE PROVIDED TO THE APPELLANT TO FIL E DOCUMENTARY EVIDENCES TO SUPPORT THE CONTENTIONS. THEREFORE, THE ADDITIONAL EVIDENCE IN THE FORM OF CERTIFICATE FROM MUNICIPALITY INDORE IS NOT ADMISSI BLE. HOWEVER, I HAVE GONE THROUGH THE CERTIFICATE ISSUE D BY THE SAID AUTHORITY AND OBSERVED THAT IT CERTIFIES T HE DISTANCE OF BICHOLI GRAM FROM THE THE MUNICIPAL LIM ITS OF INDORE. IT DOES NOT SPECIFY THE DISTANCE OF RELEVAN T KHASRA NUMBERS FROM THE MUNICIPAL LIMITS OF INDORE. THEREFORE, TECHNICALLY ON MERIT ALSO THE FACTS BROU GHT OUT IN THE CERTIFICATE ARE NOT ACCEPTABLE PARTICULARLY IN VIEW OF CONCLUSIVE CERTIFICATE OF TEHSILDAR, INDORE, THE COMPETENT AUTHORITY. FURTHER, DURING THE COURSE OF APPEAL PROCEEDINGS ON 12.08.2013, THE APPELLANT HAS FILED A CERTIFICATE FROM PWD, INDORE AND REQUESTED FOR ADMISSIONS OF THE SAME AS ADDITIONAL EVIDENCE. AS DISCUSSED ABOVE, WHEN THE ISSUE OF DISTANCE HAS BEE N SMT. TRAPTI AGRAWAL ITA NO. 458/IND/2014 5 SETTLED BY THE COMPETENT FINAL AUTHORITY I.E. THE TEHSILDAR, INDORE, THERE IS NOT REASON TO ADMIT THE CERTIFICATE FROM ANY OTHER AUTHORITY WHO IS NOT COMPETENT. THEREFORE, THE CERTIFICATE HAS NOT BEEN ADMITTED AS ADDITIONAL EVIDENCE AS DISCUSSED IN THE NOTE SHEET DATED 12.08.2013. REGARDING ADDITIONAL EVIDENCES IN SUPPORT OF THE CONTENTION FOR OAYMENT OF BROKERAGE, IT IS SEEN THAT THE RETURN OF INCOME BY THESE TWO LADIES SMT. NEETA NAHATA AND SMT. SANDHYA BAFNA HAVE BEEN FILED FOR THE RELEVANT ASSESSMENT Y EAR ON 30.03.2009 AND 06.04.2009 RESPECTIVELY. THE ASSESSMENT IN THIS CASE HAS BEEN COMPLETED ON 29.11.2010. THEREFORE, I DO NOT FIND ANY REASON AS WHY THESE ROI WERE NOT FILED BEFORE THE A.O. DURING THE COURSE OF ASSESSMENT PROCEEDINGS. IN FACT, IT IS A CLEAR CASE WHERE THE APPELLANT WANTED TO AVOID FURTHER INQUIRIES BY FILING THESE DOCUMENTS DURING THE COUR SE OF SMT. TRAPTI AGRAWAL ITA NO. 458/IND/2014 6 ASSESSMENT PROCEEDINGS. HOWEVER, DURING THE COURSE OF APPELLATE PROCEEDINGS ALSO, THE APPELLANT WAS REQUI RED TO FILE DETAILS OF ROIS FILED BY THESE LADIES INCOR PORATING INCOME ON ACCOUNT OF BROKERAGE IN EARLIER AND SUBSEQUENT ASSESSMENT YEARS. THE COUNSEL OF THE APPELLANT DURING THE COURSE OF APPELLATE PROCEEDING S HAS FAILED TO FILE ANY SUCH DETAILS. THEREFORE, K A M CONVINCED WITH A CONCLUSION DRAWN BY THE A.O. THAT THESE ARE THE ACCOMMODATION ENTRIES. THEREFORE, AFT ER CONSIDERING THE FACTS BROUGHT OUT IN THE ASSESSMENT ORDER, REMAND REPORT, WRITTEN SUBMISSIONS, I AM OF THE OPINION THAT THE A.O. WAS JUSTIFIED IN WORKING OUT THE LONG TERM CAP[ITAL GAIN AFTER CONSIDERING VARIOUS F ACTORS AND DISALLOWING THE BROKERAGE AMOUNTING TO RS.3 LAC S. THESE GROUNDS OF APPEAL ARE DISMISSED. 4. BEFORE US, THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE HAD MADE APPLICATION TO PWD SMT. TRAPTI AGRAWAL ITA NO. 458/IND/2014 7 ENGINEER AND HE CERTIFIED THAT THE SAID PROPERTY IS 6 KMS FROM BENGALI CHOURAHA TO GRAM BICHOLI HAPSI AND CERTIFICATE WAS PRODUCED. THAT EVIDENCE WAS NOT TAKEN O N RECORD. MOREOVER, THERE ARE THREE CERTIFICATES ISSUED BY THREE GOVERNMENT AGENCIES WHICH ARE ON RECORD ONE TEHSILDAR CERTIFICATE ONE MUNICIPAL CORPORATION LETTE R - ONE CERTIFICATE ISSUED BY PWD. THEREFORE, THE EXACT D ISTANCE BETWEEN THE PROPERTY AND MUNICIPAL LIMIT CANNOT BE ASCERTAINED. THEREFORE, THE MATTER MAY BE RESTORED TO THE ASSESSING OFFICER FOR DECIDING THE EXACT MEASUREMENT BETWEEN THE DISPUTED LAND AND MUNICIPAL LIMIT OF INDOR E MUNICIPAL CORPORATION. THE LEARNED DR OBJECTED TO IT ON THE GROUND THAT THE PROPERTY IS SITUATED WITHIN 8 KM S FROM THE MUNICIPAL LIMIT, THEREFORE, NO PURPOSE WILL BE S ERVED IFN THE MATTER IS RESTORED TO THE ASSESSING OFFICER. 5. WE HAVE HEARD BOTH THE SIDES. LOOKING TO THE FACTS AND CIRCUMSTANCES OF THE CASE, WE FIND THAT SECTION SMT. TRAPTI AGRAWAL ITA NO. 458/IND/2014 8 2(14)(III)(B) OF THE ACT PROVIDES THAT IN ANY AREA WIT HIN THE DISTANCE, MEASURED AERIALLY, NOT BEING MORE THAN EIGHT KILOMETRES FROM THE LOCAL LIMITS OF ANY MUNICIPALITY O R CANTONMENT BOARD REFERRED TO IN ITEM (A), AS THE CENTRAL GOVERNMENT MAY, HAVING REGARD TO THE EXTENT OF, AND S COPE FOR, URBANISATION OF THAT AREA AND OTHER RELEVANT CONSIDERATIONS, SPECIFY IN THIS BEHALF BY NOTIFICATION IN THE OFFICIAL GAZETTE. IN THIS CASE THE ASSESSING OFFICER OBTAINED THE CERTIFICATE FROM TEHSILDAR BUT THE COPY OF THE CE RTIFICATE WAS NOT PROVIDED TO THE ASSESSEE. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE HAS ALSO PRODUCED A COPY OF LETTER FROM MUNICIPALITY AND PWD. THEREFORE, THERE ARE THREE LETTERS. IN SUCH A SITUATION, WE ARE OF THE V IEW THAT THE TEHSILDAR IS THE COMPETENT AUTHORITY TO DECI DE THE DISTANCE BETWEEN THE MUNICIPAL LIMIT AND THE DISPUTED LAND. THEREFORE, THE ASSESSING OFFICER IS DIRECTED T O GIVE COPY OF THE LETTER OF TEHSILDAR TO THE ASSESSEE AND I F THE SMT. TRAPTI AGRAWAL ITA NO. 458/IND/2014 9 ASSESSEE IS NOT SATISFIED WITH THIS CERTIFICATE, HE MA Y APPLY TO TEHSILDAR FOR FRESH CERTIFICATE AND AFTER OBTAINING T HE EXACT DISTANCE FROM THE TEHSILDAR, THE ASSESSING OFFIC ER IS TO DECIDE THE MATTER AFRESH AS PER LAW. HOWEVER, IF T HE ASSESSEE FAILS TO OBTAIN THE CERTIFICATE FROM TEHSILDAR THEN THE ASSESSING OFFICER IS AT LIBERTY TO REPEAT THE ADD ITION. 6. IN THE RESULT, THE APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. THE ORDER HAS BEEN PRONOUNCED IN OPEN COURT ON 20 OCTOBER, 2016. SD/- SD/- ( ..!') (..) #$ ( (O.P.MEENA) (D.T.GARASIA) ACCOUNTANT MEMBER J UDICIAL MEMBER (') / DATED : 20 TH OCTOBER2, 2016. DN/ SMT. TRAPTI AGRAWAL ITA NO. 458/IND/2014 10