DCIT CC 40, MUMBAI V. MAMTA PAREKH, MUMBAI

ITA 4881/MUM/2013

• Counselvise Citation: [2015] 120 COUNSELVISE.COM (IT) 9229 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 9 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-03-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 20-04-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 25-06-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N PADMANABAN
• Keywords: Capital asset; Revised return

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, MUMBAI , , BEFORE SHRI VIJAY PAL RAO, JUDICIAL MEMBER AND SHRI N.K . BILLAIYA, A CCOUNTANT M EMBER / I .T.A. NO . 4881/MUM/2013 ( / ASSESSMENT YEAR : 2009 - 10 THE DCIT, CC - 40, AAYAKAR BHAVAN, MUMBAI - 400 020 / VS. SMT. MAMTA PAREKH, ZAVER MAHAL, 19/B, 3 RD FLOOR, MARINE DRIVE, MUMBAI ./ ./ PAN/GIR NO. : AAACPP 7775R ( / APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY: SHRI N. PADMANABAN / RESPONDENT BY : SHRI NEELKANTH KHANDELWAL / DATE OF HEARING : 23 . 0 3 .2015 / DATE OF PRONOUNCEMENT : 25 .03 .2015 / O R D E R PER N.K. BILLAIYA, AM: THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF THE LD. CIT(A)36, MUMBAI DT. 19.3.2013 PERTAINING TO ASSESSMENT YEAR 2009 - 10. 2. THE GRIEVANCE OF THE REVENUE READ AS UNDER : 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN NOT CONSIDERING THE SALE PROCEEDS FROM THE SALE OF LAND AS LONG TERM CAPITAL GAINS ITA. NO. 4881/M/2013 2 WITHOUT APPRECIATING THE FACT THAT THE NATURE OF THE LAND WHICH WAS SOLD WAS GAVAT, MEANING NON CULTIVABLE. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN NOT CONSIDERING THE SALE PROCEEDS FROM THE SALE OF LAND AS LONG TERM CAPITAL GAINS WITHOUT APPRECIATING THE FACT THAT THE DESCRIPTION OF THE PROPERTIES MENTIONED IN THE PURCHASE DEED KHARABA & POT KHARABA PROVE THE FACT THAT THE LAND WAS NOT PUT TO USE FOR AGRICULTURE. 3. ON THE FACTS AND IN THE CIRCU MSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN NOT CONSIDERING THE SALE PROCEEDS FROM THE SALE OF LAND AS LONG TERM CAPITAL GAINS WITHOUT APPRECIATING THE FACT THAT THE PROPERTY WHICH WAS CLAIMED BY THE ASSESSEE AS AGRICULTURAL LAND WAS SOLD ALON G WITH SPACIOUS HOUSE WHICH INDICATES THAT THE PROPERTY SOLD WAS IN THE NAME OF FARM HOUSE AND NOT OF AGRICULTURAL LAND. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN NOT CONSIDERING THE SALE PROCEEDS FROM THE S ALE OF LAND AS LONG TERM CAPITAL GAINS WITHOUT CONSIDERING ALL THE RELEVANT FACTS BROUGHT OUT IN THE ASSESSMENT ORDER AND THE REMAND REPORTS. 3. BRIEFLY STATED THE FACTS OF THE CASE ARE THAT IN THIS CASE, THE ASSESSEE FILED ORIGINAL RETURN OF INCOME ON 24.7.2009 DECLARING TOTAL INCOME AT RS. 19,663/ - . THE SAID RETURN WAS REVISED ON 8.11.2010 DECLARING TOTAL INCOME AT RS. 5,36,17,330/ - . THIS RETURN WAS SELECTED FOR SCRUTINY ASSESSMENT AND STATUTORY NOTICES WERE ACCORDINGLY ISSUED AND SERVED ON THE ASS ESSEE. 3.1. THE ASSESSING OFFICER NOTICED THAT IN THE ORIGINAL RETURN OF INCOME, THE ASSESSEE HAS NOT SHOWN THE LONG TERM CAPITAL GAIN AND THE SAME HAS BEEN OFFERED FOR TAXATION IN THE REVISED RETURN OF INCOME. THE ASSESSMENT WAS COMPLETED BY ACCEPTING THE REVISED RETURN OF INCOME. ITA. NO. 4881/M/2013 3 4. THE ASSESSEE CARRIED THE MATTER BEFORE THE LD. CIT(A) AND STRONGLY CONTENDED THAT THE CAPITAL GAIN ARISING ON SALE OF LAND WAS OUT OF SALE OF AGRICULTURAL LAND AND THE SAME IS EXEMPT U/S. 10(1) OF THE ACT. THE ASSESSEE BROUGHT TO THE NOTICE OF THE LD. CIT(A) LETTER WRITTEN BY HER DT. 21.12.2011 STATING THAT GAINS ARISING OUT OF THE SALE OF LAND IS NOT TAXABLE AND FILED A REVISED COMPUTATION OF TOTAL INCOME. IT WAS STRONGLY CONTENDED THAT THE AO HAS NOT CONSIDERED THI S SUBMISSIONS WHILE COMPLETING THE ASSESSMENT ORDER. AN AFFIDAVIT TO THIS EFFECT WAS ALSO FILED BEFORE THE LD. CIT(A). THE LD. CIT(A) TRANSMITTED THE AFFIDAVIT TO THE AO AND CALLED FOR A REMAND REPORT. THE LD. CIT(A) OBSERVED THAT IN HIS REMAND REPORT, THE AO STATED THAT THE ASSESSEE HAS CHANGED HER OPINION AT THE APPEAL STAGE THAT THE AGRICULTURAL LAND AT MANDVA IS NOT A CAPITAL ASSET. THE LD. CIT(A) FURTHER OBSERVED THA T THE AO HAS IN HIS REMAND REPORT STATED THAT THERE ARE TREES, LEAVES, STONES, PUCCA HOUSE IN THE SAID LAND. IN HIS REMAND REPORT, THE AO HAS FURTHER STATED THAT THE ASSESSEE HAS MADE INVESTMENT IN LAND TO SELL ON APPRECIATION AND NOT FOR CULTIVATION. 4. 1. AFTER CONSIDERING THE FACTS AND THE SUBMISSIONS AND ON FINDING THE FACT THAT THE LAND WAS SUBJECTED TO LAND REVENUE , T HE LD. CIT(A) HELD THAT WHAT HAS BEEN SOLD BY THE ASSESSEE IS AGRICULTURAL LAND AND IT IS NOT AT ALL NECESSARY THAT LAND SHOULD BE CUL TIVATED. IT IS ENOUGH THAT THE LAND IS CLASSIFIED AS AGRICULTURAL LAND IN THE LAND RECORD AND SUBJECTED TO LAND REVENUE. IN DELETING THE ADDITION MADE BY T HE AO, THE LD. CIT(A) RELIED UPON THE DECISION OF THE HONBLE JURISDICTIONAL HIGH COURT IN 288 ITR 618. 5. AGGRIEVED BY THIS, THE REVENUE IS BEFORE US. 6. THE LD. DEPARTMENTAL REPRESENTATIVE STRONGLY SUPPORTED THE FINDINGS OF THE AO. IT IS THE SAY OF THE LD. DR THAT THE ASSESSEE HAS ITA. NO. 4881/M/2013 4 NEVER SHOWN AGRICULTURAL INCOME FROM THE SAID LAND WHICH IN ITSEL F SHOW S THAT NO AGRICULTURAL OPERATION WAS CARRIED ON BY THE ASSESSEE , THEREFORE, THE LAND CANNOT BE SAID TO BE AGRICULTURAL LAND. 7. PER CONTRA, THE LD. COUNSEL FOR THE ASSESSEE REITERATED WHAT HAS BEEN SUBMITTED BEFORE THE LOWER AUTHORITIES. 8. WE H AVE CAREFULLY PERUSED THE ORDERS OF THE AUTHORITIES BELOW AND THE RELEVANT DOCUMENTARY EVIDENCE BROUGHT ON RECORD BEFORE US. IT IS AN UNDISPUTED FACT THAT IN THE ORIGINAL RETURN OF INCOME, THE ASSESSEE HAS ONLY RETURN ED THE INCOME FR OM OTHER SOURCES. IT IS ALSO AN UNDISPUTED FACT THAT IN THE REVISED RETURN OF INCOME, THE ASSESSEE SUO MOTO OFFERED CAPITAL GAINS ON SALE OF IMPUGNED LAND. DOCUMENTARY EVIDENCE ON RECORD SHOW THAT ON 21.12.2011 I.E. DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS, THE ASSESSE E REVISED THE COMPUTATION OF INCOME CLAIMING THAT THE IMPUGNED LAND IS AN AGRICULTURAL LAND AND IS NOT A CAPITAL ASSET AND THEREFORE NOT LIABLE FOR CAPITAL GAIN TAX. SURPRISINGLY, THERE IS NO MENTION OF THIS LETTER IN THE BODY OF THE ASSESSMENT ORDER. A PERUSAL OF THE ORDER OF THE LD. CIT(A) SHOW THAT DURING THE COURSE OF THE APPELLATE PROCEEDINGS, AN AFFIDAVIT WAS FILED BEFORE THE LD. CIT(A) STATING THAT LETTER DT. 21.12.2011 WAS FILED BEFORE THE AO. THE LD. CIT(A) HAS TRANSMITTED THIS AFFIDAVIT TO THE AO CALLING FOR A REMAND REPORT, NO ADVERSE INFERENCE HAS BEEN DRAWN BY THE AO IN THIS MATTER. THEREFORE, THE CONTENTS OF THE AFFIDAVIT STAND PROVED IN FAVOUR OF THE ASSESSEE. 8.1. WE FURTHER FIND THAT THE IMPUGNED LAND IS JOINTLY OWNED BY THE ASSESSEE W ITH TWO OTHER RELATED PERSON S HAVING 1/3 RD SHARE EACH. THERE IS NOTHING ON RECORD TO SHOW THAT ANY ADVERSE INFERENCE HAS BEEN DRAWN IN THE CASE OF THE OTHER TWO OWNERS. ON THE CONTRARY, THE ASSESSEE HAS FILED ASSESSMENT DETAILS OF THE CO - OWNERS NAMELY S MT. AMI KARTIK PAREKH AND ITA. NO. 4881/M/2013 5 SMT. RUPOOM JAYANT PAREKH. WE FIND THAT BOTH THESE CO - OWNERS HAVE SHOWN THE LONG TERM CAPITAL GAIN IN THEIR RESPECTIVE CAPITAL ACCOUNTS AND NOT IN THE RETURN OF INCOME. WE ALSO FIND THAT IN THE REVENUE RECORD PLACED AT PAGES 26, 27 AND 30 OF THE PAPER BOOK, THE IMPUGNED LAND IS SHOWN AS AGRICULTURAL LAND. CONSIDERING ALL THESE FACTS IN TOTALITY, WE HAVE NO HESITATION TO HOLD THAT THE IMPUGNED LAND WAS AN AGRICULTURAL LAND. CONSIDERING THE GROUNDS OF APPEAL RAISED BY THE REVENUE, WE DECLINE TO INTERFERE WITH THE FINDINGS OF THE LD. CIT(A). 9. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS DISMISSED. OR DER PRONOUNCED IN THE OPEN COURT ON 25 TH MARCH, 2015 SD/ - SD/ - ( VIJAY PAL RAO ) (N.K. BILLAIYA) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; DATED : 25 TH MARCH, 2015 . . ./ RJ , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE . / BY ORDER, //TRUE COPY// / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI