Krishan Tanwar, New Delhi V. ITO, New Delhi

ITA 4823/DEL/2016

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 3307 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 5 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-03-2018
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2012-2013
• Appeal Filed On: 09-09-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: ASHIMA NEB SENIOR
• Assessee Lawyers: PIYUSH KUMAR KAMAL S
• Keywords: Opportunity of being heard; Principle of natural justice; Fair market value
• Section: 37; 10

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH A : NEW DELHI) BEFORE SHRI B.P. JAIN, ACCOUNTANT MEMBER AND SHRI KULDIP SINGH, JUDICIAL MEMBER ITA NO.4822/DEL./2016 (ASSESSMENT YEAR : 2012-13) SHRI BAL KRISHAN TANWAR, VS. ITO, WARD 45 (1), WZ 377, BASAI DARAPUR, NEW DELHI. NEW DELHI 110 015. (PAN : AAUPT5171B) ITA NO.4823/DEL./2016 (ASSESSMENT YEAR : 2012-13) SHRI KRISHAN TANWAR, VS. ITO, WARD 45 (1), WZ 377, BASAI DARAPUR, NEW DELHI. NEW DELHI 110 015. (PAN : AGGPT9188C) (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI GAUTAM JAIN AND SHRI PIYUSH KUMAR KAMAL, ADVOCATES REVENUE BY : SMT. ASHIMA NEB, SENIOR DR DATE OF HEARING : 15.02.2018 DATE OF ORDER : 08.03.2018 O R D E R PER KULDIP SINGH, JUDICIAL MEMBER : SINCE COMMON QUESTIONS OF FACTS AND LAW HAVE BEEN R AISED IN BOTH THE AFORESAID APPEALS, THE SAME ARE BEING D ISPOSED OF BY WAY OF CONSOLIDATED ORDER TO AVOID REPETITION OF DI SCUSSION. ITA NOS.4822 & 4823/DEL./2016 2 2. THE APPELLANTS, SHRI BAL KRISHAN TANWAR AND SHRI KRISHAN TANWAR (HEREINAFTER REFERRED TO AS THE ASSESSEES) BY FILING THE PRESENT APPEALS, SOUGHT TO SET ASIDE THE IMPUGNED O RDER BOTH DATED 28.07.2016 PASSED BY LD. CIT(APPEALS)-15, NEW DELHI QUA THE ASSESSMENT YEAR 2012-13 ON THE SIMILAR MODIFIED-CUM -ADDITIONAL GROUNDS INTER ALIA THAT :- DENIAL OF EXEMPTION UNDER S. 10(37) 1. THAT THE LEARNED ASSESSING OFFICER HAS ERRED ON FACTS AND IN LAW IN DENYING THE APPELLANT-ASSESSEE THE EXEMPTION UNDER S. 10(37) OF THE ACT IN RESPECT OF CAPITAL GAIN ARISING FROM THE COMPULSORY ACQUISITIO N OF AGRICULTURAL LAND. 2. THAT THE LEARNED ASSESSING OFFICER HAS ERRED IN NOT ALLOWING THE APPELLANT-ASSESSEE SUFFICIENT AND PROPER OPPORTUNITY TO BE HEARD AND SUPPORT THE AFORESAID CLAIM OF EXEMPTION. 3. THAT, THEREFORE, THE' DENIAL OF THE AFORESAID EXEMPTION AND INCLUSION OF CAPITAL GAIN OF RS.L,93,48,567/ - IN THE ASSESSEE'S TOTAL INCOME IS AGAINST THE LAW AND FACTS AND' IS IN BREACH' OF THE PRINCIP LES OF NATURAL JUSTICE. ERROR IN THE AMOUNT OF COMPENSATION 4. THAT, WITHOUT PREJUDICE TO THE GROUNDS 1 TO 3 ABOVE, THE LEARNED ASSESSING OFFICER HAS ERRONEOUSL Y ADOPTED THE COMPENSATION RECEIVED BY THE APPELLANT- ASSESSEE DURING THE SUBJECT ASSESSMENT YEAR AT RS.2,11,40,528/- AS AGAINST THE CORRECT AMOUNT OF RS.2,10,98,909/-. ITA NOS.4822 & 4823/DEL./2016 3 FAIR MARKET VALUE AS ON 1 ST APRIL 1981 5. THAT, WITHOUT PREJUDICE TO THE GROUNDS 1 TO 3 ABOVE, THE LEARNED ASSESSING OFFICER HAS ERRED IN ARBITRARILY ADOPTING THE FAIR MARKET VALUE OF THE S UBJECT LAND AS ON 1ST APRIL 1981 AT RS.115 PER SQUARE METE R. 6. THAT THE LEARNED ASSESSING OFFICER HAS ERRED IN NOT ALLOWING THE APPELLANT-ASSESSEE SUFFICIENT AND PROPER OPPORTUNITY TO BE HEARD AND SHOW AND ESTABLI SH THE FAIT MARKET VALUE OF THE LAND AS ON 1 ST APRIL 1981. 2. BRIEFLY STATED THE FACTS NECESSARY FOR ADJUDICA TION OF THE CONTROVERSY AT HAND ARE : THE EXEMPTION CLAIMED BY ASSESSEES, SHRI KRISHAN TANWAR AND SHRI BAL KRISHAN TANWAR TO THE T UNE OF RS.2,11,40,528/- EACH UNDER SECTION 10 (37) OF THE INCOME-TAX ACT, 1961 (FOR SHORT THE ACT) ON ACCOUNT OF CAPITAL GA INS ARISING OUT OF COMPULSORY ACQUISITION OF LAND MEASURING 2 BIGHAS A ND 12 BISWAS OR 2191.68 SQ.MTRS. BEARING KHASRA NO.3682/2619/224 6 SITUATED IN VILLAGE BASAI DARAPUR, DELHI IN AY 2012-13 VIDE AWA RD DATED 01.09.2010, HAS BEEN DISALLOWED BY THE ASSESSING OF FICER ON THE GROUND THAT THE NATURE OF USE OF LAND IN TWO YEARS PRECEDING THE DATE OF AWARD WAS STATED TO BE COMMERCIAL, SO, THE AO HAS MADE ADDITION OF RS.1,93,48,567/- EACH ON ACCOUNT OF LON G TERM CAPITAL GAINS IN CASE OF BOTH THE ASSESSEES, SHRI KRISHAN T ANWAR AND SHRI BAL KRISHAN TANWAR. ITA NOS.4822 & 4823/DEL./2016 4 3. ASSESSEES CARRIED THE MATTER BY WAY OF FILING AP PEALS BEFORE THE LD. CIT (A) WHO HAS CONFIRMED THE ADDITIONS MAD E BY THE AO BY DISMISSING THE APPEAL. FEELING AGGRIEVED, THE A SSESSEES HAVE COME UP BEFORE THE TRIBUNAL BY WAY OF FILING THE PR ESENT APPEALS. 4. WE HAVE HEARD THE LD. AUTHORIZED REPRESENTATIVES OF THE PARTIES TO THE APPEAL, GONE THROUGH THE DOCUMENTS R ELIED UPON AND ORDERS PASSED BY THE REVENUE AUTHORITIES BELOW IN T HE LIGHT OF THE FACTS AND CIRCUMSTANCES OF THE CASE. 5. UNDISPUTEDLY, THE LAND MEASURING MEASURING 2 BIG HAS AND 12 BISWAS OR 2191.68 SQ.MTRS. EACH BELONGING TO ASSESS EES, SHRI KRISHAN TANWAR AND SHRI BAL KRISHAN TANWAR WAS ACQU IRED VIDE AWARD DATED 01.09.2010. IT IS ALSO NOT IN DISPUTE THAT BOTH THE ASSESSEES, NAMELY, SHRI KRISHAN TANWAR AND SHRI BAL KRISHAN TANWAR CLAIMED EXEMPTION OF RS.2,11,40,528/- EACH U /S 10 (37) OF THE ACT ON ACCOUNT OF COMPENSATION RECEIVED FROM GO VERNMENT FOR COMPULSORY ACQUISITION OF THEIR LAND MEASURING 2 BI GHAS AND 12 BISWAS. IT IS ALSO NOT IN DISPUTE THAT TO BE ELIGI BLE FOR GETTING EXEMPTION U/S 37 OF THE ACT, THE ASSESSEES ARE REQU IRED TO PROVE THAT THE LAND IN QUESTION WAS UNDER CULTIVATION / B EING USED FOR AGRICULTURE DURING THE PERIOD OF TWO YEARS PRECEDIN G THE DATE OF TRANSFER. FOR FACILITY OF REFERENCE, PROVISIONS CO NTAINED U/S 10(37) OF THE ACT ARE REPRODUCED AS UNDER FOR READY PERUSA L :- ITA NOS.4822 & 4823/DEL./2016 5 10 IN COMPUTING THE TOTAL INCOME OF A PREVIOUS YEAR OF ANY PERSON, ANY INCOME FALLING WITHIN ANY OF THE FOLLOWING CLAUSES SHALL NOT BE INCLUDED (37) IN THE CASE OF AN ASSESSEE, BEING AN INDIVIDUA L OR A HINDU UNDIVIDED FAMILY, ANY INCOME CHARGEABLE UNDER THE HEAD 'CAPITAL GAINS' ARISING FROM THE TRANSFER OF AGRICULTURAL LAND, WHERE (I) SUCH LAND IS SITUATE IN ANY AREA REFERRED TO IN ITE M (A) OR ITEM (B) OF SUB-CLAUSE (III) OF CLAUSE (14) OF SECTION 2; (II) SUCH LAND, DURING THE PERIOD OF TWO YEARS IMMEDIATELY PRECEDING THE DATE OF TRANSFER, WAS BEING USED FOR AGRICULTURAL PURPOSES BY SUCH HINDU UNDIVIDED FAMILY OR INDIVIDUAL OR A PARENT OF HIS; (III) SUCH TRANSFER IS BY WAY OF COMPULSORY ACQUISITION UNDER ANY LAW, OR A TRANSFER THE CONSIDERATION FOR WHICH IS DETERMINED OR APPROVED BY THE CENTRAL GOVERNMENT OR THE RESERVE BANK OF INDIA; (IV) SUCH INCOME HAS ARISEN FROM THE COMPENSATION OR CONSIDERATION FOR SUCH TRANSFER RECEIVED BY SUCH ASSESSEE ON OR AFTER THE 1ST DAY OF APRIL, 2004. EXPLANATION.FOR THE PURPOSES OF THIS CLAUSE, THE EXPRESSION 'COMPENSATION OR CONSIDERATION' INCLUDES THE COMPENSATION OR CONSIDERATION ENHANCED OR FURTH ER ENHANCED BY ANY COURT, TRIBUNAL OR OTHER AUTHORITY; 6. FROM THE FACTS AND CIRCUMSTANCES OF THE CASE, OR DERS PASSED BY THE REVENUE AUTHORITIES BELOW, GROUNDS RAISED BY THE ASSESSEES AND THE ARGUMENTS ADDRESSED BY THE LD. REPRESENTATI VES OF THE ITA NOS.4822 & 4823/DEL./2016 6 PARTIES TO THE APPEAL, THE SOLE QUESTION ARISES FOR DETERMINATION IN THIS CASE IS :- AS TO WHETHER THE LAND IN QUESTION MEASURING 2 BIG HAS AND 12 BISWAS OWNED BY ASSESSEES, SHRI KRISHAN TANWAR AND SHRI BAL KRISHAN TANWAR TO THE EXTENT OF 1/3 RD SHARE EACH COMPRISED IN KHASRA NO.3682/2619/2246 SITUATED IN VILLAGE BASAI DARAPUR , DELHI WAS BEING USED FOR AGRICULTURE PURPOSE BY THE ASSESSEES DURING THE PERIOD OF TWO YEARS IMMEDIATEL Y PRECEDING THE DATE OF TRANSFER ENTITLING THE ASSESS EES TO CLAIM EXEMPTION U/S 10(37) OF THE ACT.? 7. UNDISPUTEDLY, THIS IS A FACTUAL ISSUE WHICH IS R EQUIRED TO BE DECIDED BY THE AO, CIT (A) AND THE TRIBUNAL ON THE BASIS OF FACTS SUPPORTED WITH REVENUE RECORDS AND THE ATTENDING CI RCUMSTANCES. IT IS ALSO NOT IN DISPUTE THAT ON ONE PART OF THE L AND IN QUESTION MEASURING 42 BISWAS, PETROL PUMP HAS BEEN RUNNING S INCE 1967. IT IS ALSO NOT IN DISPUTE THAT THE LAND IN QUESTION IS ADJOINING TO RESIDENTIAL AREA OF MANSAROVAR GARDEN. 8. PERUSAL OF THE AWARD DATED 01.09.2010, AVAILABLE AT PAGES 18 TO 26 OF THE PAPER BOOK, CATEGORICALLY REFERS TO TH E REPORT GIVEN BY DELHI DEVELOPMENT AUTHORITY (DDA) AT PAGE 21 THAT T HE LAND IN QUESTION IS COMING UNDER 60 METERS ROAD R/W AND I S COVERED UNDER TRANSPORTATION LAND USED. THE LAND IN QUEST ION IS ADJOINING ITA NOS.4822 & 4823/DEL./2016 7 TO EXISTING PETROL PUMP AND RESIDENTIAL AREA OF MAN SAROVAR GARDEN AND THE AREA SURROUNDING THE SITE OF ACQUISITION IS RESIDENTIAL AS PER REPORT OF DDA AND HAS BEEN TAKEN AS SUCH FOR DETERM INING THE AWARD. REPORT OF DDA HAS NOT BEEN CONTROVERTED BY THE ASSESSEES BEFORE AO AS WELL AS LD. CIT (A) OR BEFORE THE BENC H. 9. WHEN WE FURTHER EXAMINE LAND ACQUISITION AWARD A T PAGES 21 TO 23 OF THE PAPER BOOK, THE LAND ACQUISITION CO LLECTOR (LAC) HAS DETERMINED THE AWARD BY COMPARING THE SAME WITH ADJOINING PROPERTY WHEREUPON SHOPS AND BASEMENTS HAVE BEEN CO NSTRUCTED AND IN ALL THE ADJOINING KHASRA NUMBERS, MULTI-STOR EYED BUILDING OF MANSAROVAR GARDEN HAS BEEN CONSTRUCTED WITH WHICH T HE LAND IN QUESTION HAS BEEN COMPARED FOR DETERMINING THE COMP ENSATION. CONSEQUENTLY, LAC DETERMINED THE MARKET VALUE OF TH E LAND IN QUESTION AT RS.21,800/- PER METER. 10. UNDISPUTEDLY, THE LAND WAS ACQUIRED VIDE AWARD DATED 01.09.2010 AND POSSESSION WAS TAKEN OVER BY THE GO VERNMENT ON 23.08.2010. TO DETERMINE THE FACT IF ANY PIECE OF LAND REMAINED UNDER CULTIVATION DURING THE PERIOD OF PRECEDING TW O YEARS OF DATE OF TRANSFER, THE PRIMARY EVIDENCE IS REVENUE RECOR D WHICH IS PREPARED BY THE HALKA PATWARI BY MAKING PHYSICAL VE RIFICATION OF THE CROPS STANDING ON THE LAND IN QUESTION AFTER EV ERY SIX MONTHS I.E. RABI AND KHARIF. REVENUE RECORD I.E. JAMABAND I AND KHASRA ITA NOS.4822 & 4823/DEL./2016 8 GIRDWARI FOR THE TWO YEARS IMMEDIATELY PRECEDING TH E DATE OF TRANSFER I.E. 23.08.2010 HAVE NOT SEEN THE LIGHT OF THE DAY. SINCE THE ONUS IS ON THE ASSESSEES TO PROVE THAT THE LAND IN QUESTION HAD BEEN CONTINUOUSLY USED FOR AGRICULTURE PURPOSE, THE ASSESSEE WAS DUTY BOUND TO BRING ON RECORD THE JAMABANDI AND KHA SRA GIRDWARI BEFORE AO AND THEN CIT (A) OR AT THE MOST THE ASSES SEE COULD HAVE PRODUCED THE REVENUE RECORD BEFORE THE BENCH FOR PE RUSAL. 11. HOWEVER, THE ASSESSEE BROUGHT ON RECORD JAMABAN DI FOR THE YEAR 1960-61 AND KHASRA GIRDWARI FOR KHARIF 1997 AN D RABI 1998, AVAILABLE AT PAGES 14 TO 16 OF THE PAPER BOOK, WHIC H ARE OF NO SUPPORT TO THE ASSESSEES. 12. PERUSAL OF PARAS 15 & 16 OF THE ASSESSMENT ORDE R APPARENTLY GOES TO PROVE THAT A DISCREET FACT FINDING ENQUIRY HAS BEEN CONDUCTED BY THE AO TO MAKE OUT IF THE LAND IN QUES TION WAS BEING USED FOR AGRICULTURE PURPOSE TWO YEARS PRIOR TO ITS TRANSFER TO THE GOVERNMENT, BUT THE ASSESSEE HAS FAILED TO BRING AN Y SUCH DOCUMENT BEFORE AO. MOREOVER, WHEN COMPENSATION HA S BEEN DETERMINED BY THE LAC BY COMPARING THE LAND IN QUES TION WITH THE ADJOINING LAND WHEREUPON RESIDENTIAL BUILDINGS AND PETROL PUMP HAVE BEEN RUNNING, THE ASSESSEES IS ESTOPPED BY ITS OWN ACTS AND CONDUCT BY CLAIMING THAT THE LAND IN QUESTION IS AN AGRICULTURE LAND ITA NOS.4822 & 4823/DEL./2016 9 PARTICULARLY WHEN THE ENTIRE RELEVANT REVENUE RECOR D HAS BEEN SUPPRESSED. 13. THE LD. AR FOR THE ASSESSEE BY RELYING UPON THE DECISION RENDERED BY HONBLE PUNJAB & HARYANA HIGH COURT IN JASWANT RAI VS. COMMISSIONER OF WEALTH-TAX (1977) 107 ITR 477 (P&H) CONTENDED THAT WHEN LAND IN POSSESSION OF OTHER CO- SHARER OF THE ASSESSEES, NAMELY, RAMESH SINGH TANWAR HAS BEEN SUB JECTED TO LOWER RATE OF TAXATION BY AWARDING HIM THE SIMILAR EXEMPTION U/S 10(37) OF THE ACT BY THE REVENUE AUTHORITIES, THE A DDITION MADE BY THE AO AND CONFIRMED BY THE LD. CIT (A) IS NOT SUST AINABLE. 14. HOWEVER, WE ARE OF THE CONSIDERED VIEW THAT SIN CE THE ISSUE IN QUESTION HAS BEEN DECIDED BY THE REVENUE AUTHORI TIES BELOW ON THE BASIS OF FACTS IN THE LIGHT OF THE STATUTE PARI TY WITH OTHER CASES CANNOT BE CLAIMED AS THERE IS NO ESTOPPEL AGAINST S TATUTE. FOR ONE REASON OR THE OTHER, IN CASE THE APPARENT FACTS HAV E BEEN OVERLOOKED BY THE REVENUE AUTHORITIES TO DECIDE THE IDENTICAL ISSUE, THE ASSESSEES CANNOT CLAIM BENEFIT OF THE WRONG COMMITT ED BY A REVENUE OFFICER AS THE PRINCIPLE OF RES JUDICATA IS NOT APPLICABLE IN TAX MATTERS. SO, IN THESE CIRCUMSTANCES, THE JUDGM ENT RELIED UPON BY THE LD. AR FOR THE ASSESSEES IS NOT APPLICABLE T O THE FACTS AND CIRCUMSTANCES OF THE CASE. ITA NOS.4822 & 4823/DEL./2016 10 15. THE LD. AR FOR THE ASSESSEE ALSO RELIED UPON TH E CASES OF HONBLE HIGH COURT OF MADRAS IN CIT VS. S. MUTHUKAR UPAN (2007) 163 TAXMAN 45 (MAD.) AND CIT, CHENNAI VS. KUMARARANI SMT. MEENAKSHI ACHI (2007) 158 TAXMAN 4 (MADRAS) WHICH ARE ALSO NOT APPLICABLE TO THE FACTS AND CIRCUMSTANCES OF THE CASE BECAUSE THE CASE IN HAND HAS BEEN DECIDED BY THE AO AS WELL AS CIT (A) ON THE BASIS OF FACTS PROVED AND THEN ADMIT TED ON RECORD BY THE ASSESSEE. 16. IN VIEW OF WHAT HAS BEEN DISCUSSED ABOVE, FINDI NG NO ILLEGALITY OR PERVERSITY IN THE FINDINGS RETURNED B Y THE LD. CIT (A), PRESENT APPEALS BEARING ITA NO.4822/DEL./2016 AND I TA NO.4823/DEL/2016 ARE HEREBY DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON THIS 8 TH DAY OF MARCH, 2018. SD/- SD/- (B.P. JAIN) (KULDIP SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED THE 8 TH DAY OF MARCH, 2018 TS ITA NOS.4822 & 4823/DEL./2016 11 COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT(A)-15, NEW DELHI. 5.CIT(ITAT), NEW DELHI. AR, ITAT NEW DELHI.