ANIL KUMAR OMKAR SINGH AURORA, MUMBAI V. ITO 12(3)(4), MUMBAI

ITA 4648/MUM/2013

• Counselvise Citation: 464819914 RSA 2013
• Duration Of Justice: 4 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-11-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2009-2010
• Appeal Filed On: 14-06-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Revised return
• Section: 54; 139; 54F

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, MUMBAI BEFORE S/SHRI B.R.MITTAL,(JM) AND RAJENDRA (AM) . . , , ./I.T.A. NO.4648/MUM/2013 ( / ASSESSMENT YEAR:2009-10) ANIL KUMAR OMKAR SINGH AURORA FLAT NO.13, AL-JABERY COURT, 69, MARINE DRIVE, MUMBAI-400020 / VS. INCOME TAX OFFICER - 12(3)(4), MUMBAI. ( & / APPELLANT) .. ( ' & / RESPONDENT) ./ ./PAN/GIR NO. : AACPA0369C & / APPELLANT BY : SHRI MANDAR VAIDYA ' & * /RESPONDENT : SHRI JAVED AKHTAR * - / DATE OF HEARING : 30.10.2013 * - /DATE OF PRONOUNCEMENT : 6.11.2013 / O R D E R PER B.R.MITTAL, JM: THE ASSESSEE HAS FILED THIS APPEAL FOR ASSESSMENT YEAR 2009-10 AGAINST ORDER OF LD. CIT(A) DATED 30.03.2013 ON FOLLOWING GROUNDS : 1. THE LD. CIT(A) ERRED IN UPHOLDING THE REJECTION OF THE APPELLANTS CLAIM OF DEDUCTION U/S 54F ON THE GROUND THAT UTILIZATION OF SALE CONSIDERATION WAS NOT WITHIN THE DUE DATE OF RETURN AS U/S 139(1) BUT WITHIN THE DUE DATE OF FILING RETURN AS UNDER SECTION 139(4); 2. THE LD. CIT(A) FELL IN ERROR OF LAW IN NOT APPRE CIATING THAT THE APPELLANT/ ASSESSEE IS ENTITLED FOR THE EXEMPTION U/S 54F IF THE SALE CONSIDERATION UTILIZED FOR INVESTMENT IN NEW RESIDENTIAL PROPERTY WITHIN T HE DUE DATE STIPULATED UNDER SECTION 139(4) OF THE ACT. 3. THE LD. CIT(A) WAS NOT JUSTIFIED IN NOT CONSIDER ING THE DECISION OF THE HONBLE HIGH COURT AND THE HONBLE TRIBUNAL WHICH WERE BOUGHT TO HIS NOTICE. 2. RELEVANT FACTS CONCERNING TO THIS ISSUE ARE THAT THE ASSESSEE FILED HIS RETURN OF INCOME ON 25.9.2009 DECLARING TOTAL INCOME AT RS.3 ,23,410/- AND FILED REVISED RETURN OF INCOME ON 5.4.2010 DECLARING TOTAL INCOME AT RS.3,3 3,630/-. IT IS SEEN FROM THE AIR I.T.A. NO.4648/MUM/2013 2 INFORMATION THAT ASSESSEE HAS SOLD A PROPERTY OF R S.70 LAKHS DURING THE YEAR UNDER CONSIDERATION AND ASSESSEE HAS NOT DISCLOSED THIS S ALE IN THE ORIGINAL RETURN AND CLAIMED DEDUCTION U/S 54F. THIS SALE OF PROPERTY WAS SHOWN ONLY IN THE REVISED RETURN FILED ON 5.4.2010. 2.1 DURING THE COURSE OF ASSESSMENT PROCEEDINGS, TH E AO OBSERVED THAT THE ASSESSEE HAS SHOWN SALE OF UNIT NO.365, A TO Z INDU STRIAL ESTATE FOR TOTAL CONSIDERATION OF RS.70 LAKHS ON 21.11.2008. AO ALSO NOTED THAT ASSESSEE ENTERED INTO A MOU ON 1.8.2009 WITH M/S ORLANDO TRADING PVT. LTD FOR PUR CHASE OF THE PROPERTY ALONG WITH OTHER FAMILY MEMBERS FOR TOTAL CONSIDERATION OF RS .1,11,84,000/-. THE ASSESSEE CLAIMED EXEMPTION U/S 54F ON ENTIRE GAIN ON PURCHAS E OF RESIDENTIAL HOUSE PURCHASED. THE TRANSFER DEED WAS MADE ON 15.10.2009 AND THE P AYMENT OF RS.10 LAKHS WAS MADE ON 1.8.2009 AND THE BALANCE WAS PAID BY OCTOBER, 2 009. AO CALLED UPON THE ASSESSEE TO EXPLAIN AS TO WHETHER THE CONSIDERATION RECEIVED WAS UTILIZED BEFORE THE DATE OF FURNISHING OF RETURN OF INCOME U/S 139(1) AND IF NO T, WHETHER THE SAME WAS DEPOSITED IN CAPITAL GAIN SCHEME ACCOUNT BEFORE THE DUE DATE OF FILING OF RETURN AS PER THE PROVISIONS OF SECTION 139(1). THE DATE OF FILING IN CASE OF ASSESSEE WAS 31.7.2009. 2.2 IN REPLY, THE ASSESSEE STATED THAT PURCHASE OF FLAT WAS FINALIZED BEFORE 23.7.2009. SINCE THERE WAS NO CLEAR TITLE, MOU WAS PREPARED ON 29.7.2009 BUT EXECUTED ON 1.8.2009. FURTHER PAYMENT WAS MADE IN AUGUST, 2009 AND OCTOBER, 2009. THE ASSESSEE STATED THAT HE HAS NOT MADE ANY INVES TMENT IN CAPITAL GAIN SCHEME BEFORE THE DUE DATE OF FILING OF RETURN U/S 139(1) AS THE PURCHASE OF FLAT WAS VIRTUALLY FINALIZED AND INVESTMENT IN CAPITAL GAIN SCHEME FOR A BRIEF PERIOD WAS NOT FEASIBLE. THE ASSESSEE CONTENDED THAT TRANSACTION WAS COMPLETED BEFORE 31.7.2009. HENCE, HE IS ELIGIBLE FOR EXEMPTION U/S 54F OF THE ACT. THE AS SESSEE STATED THAT THE FLAT WAS PURCHASED ON 15.10.2009 AND THEREFORE CAPITAL GAIN FOR THE PURCHASE OF PROPERTY HAD BEEN UTILIZED BEFORE THE EXTENDED DUE DATE OF FILIN G OF RETURN U/S 139(4) I.E. 31.3.2010. IN SUPPORT OF HIS CONTENTION, HE RELIED ON THE DECI SION OF HONBLE KARNATAKA HIGH COURT IN THE CASE OF FATIMABAI V/S ITO (2009) 32 DTR 243 AND THE DECISION OF HONBLE GUWAHATI HIGH COURT IN THE CASE OF CIT V/S RAJESH KUMAR JALAN REPORTED IN 206 CTR 361. THE ASSESSEE ALSO ACCEPTED THAT THERE WAS AN I NADVERTENT MISTAKE ON HIS PART IN NOT DISCLOSING THE TRANSACTION IN THE ORIGINAL RETU RN. 2.3 AO DID NOT FIND FAVOUR WITH THE ASSESSEE. HE OB SERVED THAT SECTION 54F(4) IS CLEAR THAT THE AMOUNTS SHOULD BE UTILIZED PRIOR TO THE DUE DATE FOR FILING OF RETURN SPECIFIED U/S 139(1) I.E.BEFORE 31.7.2009, EVEN IF IT WAS NOT UTILIZED BY THAT DATE THE I.T.A. NO.4648/MUM/2013 3 ASSESSEE WAS ELIGIBLE FOR EXEMPTION IN VIEW OF THE PROVISIONS OF SECTION 54F(1) WHICH PROVIDES THAT THE PROPERTY CAN BE PURCHASED WITHIN TWO YEARS AFTER THE DATE OF TRANSFER, BUT AS ON THE DATE OF FILING OF RETURN THE AMOUNT S HOULD BE DEPOSITED IN CAPITAL GAIN SCHEME ACCOUNT. THEREFORE, AO WAS OF THE VIEW THA T ASSESSEE HAD NOT UTILIZED THE NET CONSIDERATION BEFORE THE DUE DATE OF FILING OF RETU RN U/S 139(1) AND NOR DEPOSITED THE NET CONSIDERATION IN THE CAPITAL GAIN ACCOUNT SCHEM E BEFORE DUE DATE. THEREFORE, ASSESSEE IS NOT ELIGIBLE FOR EXEMPTION U/S 54F. HE WAS ALSO OF THE VIEW THAT ASSESSEE HAS NOT UTILIZED THE AMOUNT PRIOR TO THE RETURN FIL ED BY HIM U/S 139(4) ON 25.9.2009. THEREFORE, AO DID NOT ALLOW EXEMPTION U/S 54F AND A DDED ENTIRE AMOUNT OF RS.69.94 TO THE TOTAL INCOME UNDER THE HEAD CAPITAL GAIN. BEING AGGRIEVED, ASSESSEE FILED APPEAL BEFORE THE FIRST APPELLATE AUTHORITY. LD. CIT(A) UPHELD THE ACTION OF THE AO. HENCE, ASSESSEE IS IN FURTHER APPEAL BEFORE US. 3. AT THE TIME OF HEARING, LD.AR REITERATED THE FAC TS AS SUBMITTED BEFORE THE LOWER AUTHORITIES AND CONTENDED THAT THE VERY ISSUE HAS CAME UP BEFORE THE HONBLE MUMBAI BENCH OF TRIBUNAL IN THE CASE OF KISHORE H GALAIYA V/S ITO [2012] 24 TAXMANN.COM 11 (MUM), WHEREIN ON IDENTICAL FACTS AND CIRCUMSTANCES , THE ISSUE HAS BEEN DECIDED IN FAVOUR OF THE ASSESSEE AND IN SUPPORT OF HIS CONTEN TION HE PLACED A COPY OF ORDER PASSED IN KISHOR H GALAIYA (SUPRA). HE SUBMITTED THAT TH E ISSUE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF MUMBAI BENCH O F TRIBUNAL IN THE CASE OF KISHOR H GALAIYA(SUPRA). TO CORROBORATE HIS SUBMISSIONS, HE ALSO PLACED COPIES OF ORDERS IN SMT.RITA CHETAN NAIK IN ITA NO.3986/MUM/2012 (AY- 2008-09) DATED 10.7.2013, CIT V/S RAJESH KUMAR JAIN (2006) 286 ITR 274 (GAUHATI), FATHIMA BAI V/S ITO (2009) 32 DTR (KAR) 243, TRUSTEES OF TULSIDAS GOPALJI CHARI TABLE AND CHALESHWAR TEMPLE TRUST(1994) 207 ITR 368 (BOM), CIT V/S JAGTAR SINGH CHAWLA (2013) 215 TAXMAN 154 AND P.R.KULKARNI AND SONS (HUF) V/S ADDL.CIT (201 1) 135 TTJ (BANG) 630. 4. LD. DR JUSTIFIED THE ORDERS OF AUTHORITIES BELOW . HE FURTHER SUBMITTED THAT SIMILAR ISSUE WAS ALSO CONSIDERED BY ITAT DELHI BE NCH IN THE CASE OF TARANBIR SINGH SAWHNEY V/S DCIT [2006] 5 SOT 417 (DELHI), WHEREIN, THE EXEMPTION U/S 54F OF THE ACT WAS DENIED TO THE ASSESSEE WHERE THE ASSESSEE FAILED TO APPROPRIATE THE NET CONSIDERATION TOWARDS PURCHASE OF RESIDENTIAL PROP ERTY AND NOR WAS DEPOSITED IN THE GAIN SPECIFIED IN TERMS OF SECTION 54F (4) BEFORE THE DUE DATE OF FILING OF THE RETURN U/S 139 (1) OF THE ACT. I.T.A. NO.4648/MUM/2013 4 5. WE HAVE CAREFULLY CONSIDERED THE SUBMISSIONS OF LD. REPRESENTATIVES OF THE PARTIES AND ORDERS OF AUTHORITIES BELOW. WE HAVE A LSO CONSIDERED THE ORDERS CITED BEFORE US BY LD. REPRESENTATIVES IN SUPPORT OF THEI R SUBMISSIONS. 6. ONLY ISSUE INVOLVES IN THIS APPEAL IS AS TO WHET HER EXTENDED PERIOD AS PER SECTION 139(4) HAS TO BE CONSIDERED FOR THE PURPOSE OF UTILIZATION OF AMOUNT OF CAPITAL GAIN FOR THE PURPOSE OF CLAIMING EXEMPTION U/S 54F OF THE ACT. THE ABOVE ISSUE IS SQUARELY COVERED BY THE DECISION OF HONBLE PUNJAB AND HARYANA HIGH COURT IN THE CASE OF CIT V/S MS. JAGRITI AGGARWAL (2011) 339 ITR 61 0 (P&H), WHEREIN, THEIR LORDSHIPS HAVE HELD THAT PROVISION OF SECTION 139(4) IS NO T AN INDEPENDENT PROVISION, BUT IS RELATED TO TIME CONTEMPLATED UNDER THE PROVISION O F SECTION 139(1) OF THE ACT. ACCORDINGLY, SECTION 139(4) HAD TO BE READ ALONG WI TH SUB-SECTION (1) OF SECTION 139 AND THE DUE DATE FOR FURNISHING THE RETURN OF INCOM E U/S 139(1) IS SUBJECT TO THE EXTENDED PERIOD PROVIDED U/S 139(4). HENCE, EXT ENDED PERIOD U/S 139(4) HAS TO BE CONSIDERED FOR THE PURPOSE OF UTILIZATION OF THE CA PITAL GAIN AMOUNT. THE ITAT, MUMBAI FOLLOWING THE DECISION OF THE HONBLE PUNJAB AND H ARYANA HIGH COURT IN THE CASE OF KISHORE GALAIYA V/S ITO (137 ITD 229) HAS HELD THAT WHEN THE ASSESSEE HAD UTILIZED THE AMOUNT WHICH WAS MORE THAN THE CAPITAL GAIN EARNED TOWARDS CONSIDERATION OF NEW RESIDENTIAL HOUSE WITHIN EXTENDED PERIOD U/S 139(4) OF THE ACT, THE CLAIM MADE BY ASSESSEE FOR EXEMPTION U/S 54F OF THE ACT COULD NO T BE DENIED. 7. THE SIMILAR ISSUE HAD ALSO COME UP BEFORE THE H ONBLE GUWAHATI HIGH COURT IN THE CASE OF CIT V/S RAJESH KUMAR JALAN (SUPRA) AN D THE HONBLE HIGH COURT HAS HELD THAT IF THE ASSESSEE FULFILS THE CONDITION FOR EXEM PTION U/S 54 WITHIN THE EXTENDED TIME OF FILING OF RETURN U/S 139(4) OF THE ACT, THE ASS ESSEE IS ENTITLED TO EXEMPTION U/S 54 OF THE ACT. IN VIEW OF ABOVE, WE HOLD THAT THE ASSES SEE IS ENTITLED TO CLAIM DEDUCTION U/S 54F OF THE ACT FOR UTILIZATION OF SALE CONSIDERATI ON FOR INVESTMENT IN NEW RESIDENTIAL PROPERTY WITHIN DUE DATE AS STIPULATED U/S 139 OF THE ACT. HENCE, GROUNDS OF APPEAL TAKEN BY ASSESSEE ARE ALLOWED BY REVERSING THE ORDE RS OF AUTHORITIES BELOW. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. ORDER PRONOUNCED IN THE OPEN COURT ON THE 6 TH NOVEMBER, 2013 * 1 2 6TH NOVEMBER, 2013 * SD SD ( /RAJENDRA ) ( . . /B.R.MITTAL) / ACCOUNTANT MEMBER / JUDICIAL MEMBER MUMBAI; 2 DATED 6/ 11/2013 I.T.A. NO.4648/MUM/2013 5 . . ./ SRL , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. & / THE APPELLANT 2. ' & / THE RESPONDENT. 3. 6 ( ) / THE CIT(A)- CONCERNED 4. 6 / CIT CONCERNED 5. 7 '9 , - 9 , / DR, ITAT, MUMBAI CONCERNED 6. / GUARD FILE. / BY ORDER, TRUE COPY (ASSTT. REGISTRAR) - 9 , /ITAT, MUMBAI