Aditya Gupta, New Delhi V. ITO, New Delhi

ITA 4945/DEL/2016

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 6649 (ITAT-DELHI)
• Duration Of Justice: 4 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-02-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC 1
• Next Hearing Date: 08-12-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 16-09-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: F R MEENA
• Assessee Lawyers: O P PAHUJA
• Keywords: Sale consideration of property below Jantri Value; Salary income; Opportunity of being heard; Additional evidence
• Section: 50C

Judgement Text

I.T.A .NO.-4945/DEL/2016 ADITYA GUPTA VS ITO IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: SMC-I NEW DELHI BEFORE SMT DIVA SINGH, JUDICIAL MEMBER I.T.A .NO.-4945/DEL/2016 (ASSESSMENT YEAR-2009-10) ADITYA GUPTA, 2936/43, BEADON PURA, KAROL BAGH, NEW DELHI-110005. PAN-AFHPG9234N ( APPELLANT) VS ITO, WARD-71(1), NEW DELHI. (RESPONDENT) ASSESSEE BY SH.O.P.PAHUJA, ADV. REVENUE BY SH.F.R.MEENA, SR.DR DATE OF HEARING 08 . 12 .2016 DATE OF PRONOUNCEMENT 15.02.2017 ORDER THE PRESENT APPEAL HAS BEEN FILED BY THE ASSESSEE A SSAILING THE CORRECTNESS OF THE ORDER DATED 16.06.2016 OF CIT(A)-21, NEW DELHI PERT AINING TO 2009-10 ASSESSMENT YEAR ON VARIOUS GROUNDS INCLUDING GROUND NO.1.3 IN THE PRES ENT APPEAL ON WHICH THE PARTIES WERE HEARD. ACCORDINGLY, FOR READY-REFERENCE, GROUND NO .1 IS REPRODUCED HEREUNDER:- 1.1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE ID. CIT ( A) ERRED IN NOT DECIDING THE APPLICATION DATED 21 .07.2014 FIELD BY THE APPELLANT FOR PERMISSION TO RAISE ADDITIONAL GROUND OF APPEAL ATTACHED AS ANNEXURE B. 1.2. THE LD. CIT(A) ERRED IN LAW AND FACTS OF THE C ASE IN NOT ADMITTING AND DECIDING THE ADDITIONAL GROUNDS OF APPEAL RAISED BY THE APPELLANT VIDE LETTER DATED 21.07.2014. 1.3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE AND IN LAW, THE ID. CIT (A) ERRED IN REJECTING APPLICATION UNDER RULE 4 6A OF THE IT RULES, 1962 ATTACHED AS ANNEXURE C ' 1.4. THE LD. CIT(A) ERRED IN LAW AND FACTS AND IN THE CIRCUMSTANCES OF THE CASE IN DECIDING THE APPEAL WITHOUT THE FINAL REPOR T OF THE DVO DULY CALLED BY ITS PREDECESSOR CIT (A) VIDE LETTER NO, CIT(A) XXX/RE MAND REPORT/2017- 15/10 DATED 12.08.2014 WHEREBY INSTRUCTIONS WERE IS SUED TO DVO THROUGH THE AO VIDE LETTER DATED 28.08.2014 TO GIVE THE APPELLA NT THE OPPORTUNITY OF HEARING BEFORE SUBMITTING THE FINAL REPORT. 2. IT WAS SUBMITTED BY THE LD.AR INVITING ATTENTION TO THE ADDITION SUSTAINED IN APPEAL THAT RELEVANT EVIDENCES WERE NOT CONSIDERED BY THE CIT(A). INVITING ATTENTION TO THE IMPUGNED ORDER VIS-A-VIS GROUND NO.1.3 AND THE PAP ER BOOK PAGE NO.93 TO 104 ON RECORD WHICH CONTAINS THE WRITTEN SUBMISSIONS OF THE ASSES SEE ALONGWITH THE REMAND REPORT DATED 11.08.2014 AND 17.12.2013 ON RECORD IT WAS SU BMITTED THAT THE ASSESSEE COULD NOT PLACE THE EVIDENCE BEFORE THE AO AND SOUGHT TO FILE FRESH EVIDENCE BEFORE THE CIT(A) PAGE 2 OF 5 I.T.A .NO.-4945/DEL/2016 ADITYA GUPTA VS ITO CONSISTING OF THE AGREEMENT DATED 16.05.2008 AS IN ADVERTENTLY IT REMAINED WITH HIS UNCLE AND THE ASSESSEE WHO HAD LOST HIS FATHER ON 12.10.2 007 AFTER PROLONGED ILLNESS WAS LEFT TO COPE WITH HIS TRAUMATIZED MOTHER. BEING EMPLOYED I N GURGAON THE ASSESSEE THEN BEING ONLY 30 YEARS OLD BORROWED FROM FRIENDS, RELATIVES AND HIS UNCLE AT SAHARANPUR THUS THE FINANCIAL DETAILS REMAINED WITH HIS UNCLE. SINCE HUGE AMOUNT WAS INVESTED IN THE TREATMENT OF HIS FATHER, THE FINANCIAL AFFAIRS FOR THE TREATMENT AND MANAGEMENT OF OTHER AFFAIRS ETC. WERE HANDLED AND MANAGED BY THE SAID U NCLE. THUS, SINCE THE LAND IN QUESTION COULD ALSO NOT BE DISPOSED OF IN A HURRY TO PAY TH E DEBTS AND THE ASSESSEE WAS EMPLOYED AT GURGAON AND RECEIVING ONLY SALARY, THE DOCUMENTS REMAINED WITH THE UNCLE BY OVERSIGHT. IT WAS SUBMITTED THAT AS A RESULT OF THIS REASON TH EY COULD NOT BE PRODUCED BEFORE THE AO, IT WAS ONLY WHEN DISCUSSING HIS AFFAIRS WITH HIS UN CLE THAT THE UNCLE RECALLED THAT THE DOCUMENTS WERE WITH HIM AND GAVE THEM TO THE ASSESS EE. THUS, IT WAS ARGUED THAT THE SALE OF THE SPECIFIC PIECE OF LAND BELOW THE CIRCLE RATE WAS ON ACCOUNT OF THE PECULIAR FACTS AND CIRCUMSTANCES CREATED DUE TO THE NEED AND NECES SITY OF MONEY FOR TREATMENT OF HIS FATHER. HOWEVER, SINCE THE SUPPORTING DOCUMENT INA DVERTENTLY COULD NOT BE PLACED BEFORE THE AO, IN THESE CIRCUMSTANCES, IT WAS HIS PRAYER T HAT THE TAX AUTHORITIES MAY BE DIRECTED TO ADMIT THE EVIDENCE AND CONSIDER THE ALLOWABILITY O F THE ASSESSEES CLAIM AFTER TAKING RELEVANT AND CRUCIAL DOCUMENTS ON RECORD. 2.1. THE IMPUGNED ORDER, IT WAS SUBMITTED WAS FURTH ER NOT MAINTAINABLE AS THE DIRECTIONS GIVEN BY THE CIT(A), NEW DELHI DATED 12.08.2014 AND 28.08.2014 PLACED AT PAPER BOOK PAGE 105 AND 108 DIRECTING THE DVO TO PROVIDE AN OP PORTUNITY OF BEING HEARD TO THE ASSESSEE BEFORE SUBMITTING THE FINAL REPORT HAS NO T BEEN PROVIDED. IT WAS SUBMITTED THE DVOS REPORT WAS CONFRONTED FOR THE FIRST TIME TO T HE ASSESSEE AT THE APPELLATE STAGE, THE ASSESSEE WAS TO BE CONFRONTED BY THE DVO DURING THE REMAND PROCEEDINGS. FOR THE SAID PURPOSE THE ASSESSEE HAD RAISED ADDITIONAL GROUNDS WHICH IS ADDRESSED IN PARA 5 OF THE STATEMENTS OF FACTS FILED IN THE PRESENT APPEAL AND ADDRESSED IN GROUND NO.1.1 AND 1.2 IN PAGE 3 OF 5 I.T.A .NO.-4945/DEL/2016 ADITYA GUPTA VS ITO THE PRESENT APPEAL. REFERRING TO THE RECORD IT WAS SUBMITTED THAT THE CIT(A) HAS NOT EVEN CARED TO ADDRESS THE ADDITIONAL GROUNDS RAISED BEFO RE HIM. 2.2. ACCORDINGLY, IT WAS HIS LIMITED PRAYER THAT TH E IMPUGNED ORDER MAY BE SET ASIDE AND RESTORED TO THE CIT(A) WITH A DIRECTION TO ADMIT FR ESH EVIDENCES AND THE ASSESSEES OBJECTION TO THE DVOS REPORT MAY BE DIRECTED TO BE CONSIDERED AS THE FINAL REPORT WAS FILED WITHOUT HEARING THE ASSESSEE FOR WHICH ADDITIONAL G ROUND WAS REQUIRED TO BE RAISED. 3. LD. SR.DR CONSIDERING THE PECULIAR FACTS AND CIR CUMSTANCE, THE WRITTEN SUBMISSIONS TO THE REMAND REPORT AVAILABLE IN THE PAPER BOOK AN D THE COPY OF APPLICATION FILED SEEKING PERMISSION TO RAISE ADDITIONAL GROUNDS BEFORE THE C IT(A) AT PAGE 89 TO 92 OF THE PAPER BOOK, HAD NO OBJECTION IF THE ISSUES ARE REMANDED T HE CIT(A) IN ORDER TO CONSIDER THE PRAYER OF THE ASSESSEE. 4. I HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED T HE MATERIAL AVAILABLE ON RECORD. IT IS SEEN THAT THE ASSESSEE RETURNED AN INCOME FROM SALARY, CAPITAL GAIN AND INCOME FROM OTHER SOURCES AMOUNTING TO RS.4.10.030/-. THE RETU RN WAS PICKED UP FOR SCRUTINY THROUGH CASS AFTER ISSUANCE OF NOTICE U/S 143(2) AND THE AS SESSMENT WAS CONCLUDED AT AN INCOME OF RS.19,29,330/-. THE ASSESSEE HAS CHALLENGED THE ADDITION OF RS.15,90,300/- IN THE PRESENT PROCEEDINGS. THE FACTS RELATABLE THERETO A RE THAT LAND AT VILLAGE-MALHIPUR PARGANA, TEHSIL & DISTRICT SAHARANPUR WAS SOLD ON 16.01.200 9 FOR RS.23 LACS. THE SALE WAS REGISTERED FOR AN AMOUNT OF RS.54,11,000/- ON WHICH STAMP DUTY OF RS.3,68,800/- WAS PAID. AS PER THE DETAILS TAKEN INTO CONSIDERATION, THE LA ND WAS SOLD BY THE ASSESSEE AND SMT. SHASHI GUPTA (HALF PART FOR SMT. RAHISA BEGAM) FOR THE SAID AMOUNT BY WHICH CAPITAL GAIN OF RS.10,91,800/- WAS CLAIMED AND SHOWN TO HAVE BEE N PURCHASED FOR RESIDENTIAL HOUSES AT CHANDER NAGAR, SHARAHANPUR ON 18.02.2009 FOR RS.11, 28,000/-. THE ASSESSEE WAS PUT TO NOTICE WHY SECTION 50C SHOULD NOT BE APPLIED AS STA MP DUTY WAS PAID AT THE SALE CONSIDERATION OF RS.54,11,000/- AND NOT RS.23 LACS. THE ASSESSEE CLAIMED THAT IN THE SPECIFIC AREA, THE OFFICIAL CIRCLE RATE VIS-A-VIS T HE ACTUAL RATE WAS MUCH HIGHER WHICH CLAIM PAGE 4 OF 5 I.T.A .NO.-4945/DEL/2016 ADITYA GUPTA VS ITO WAS REJECTED IN THE ASSESSMENT PROCEEDINGS. BEFORE THE CIT(A), THE ASSESSEE SOUGHT TO PLACE ADDITIONAL EVIDENCE BY WAY OF AGREEMENT TO SA LE IN REGARD TO THE SALE OF THE SAID PROPERTY AND ALSO SOUGHT RELY UPON INSTANCES OF SAL E AT THE RELEVANT POINT OF TIME. IN SUPPORT OF THE ADDITIONAL EVIDENCE, AFFIDAVIT OF SH . SALIL GUPTA, UNCLE IS FOUND TO BE PLACED ON RECORD. ACCORDINGLY CONSIDERING THE PECULIAR FA CTS AND CIRCUMSTANCES OF THE PRESENT CASE, I FIND THAT THE IMPUGNED ORDER CANNOT BE UPHE LD. THE PRAYER OF THE ASSESSEE FOR ADMISSION OF ADDITIONAL EVIDENCES IN THE PECULIAR F ACTS AND CIRCUMSTANCES OF THE CASE, I FIND WAS FULLY JUSTIFIED. NOT ONLY THE EVIDENCE IS RELE VANT AND CRUCIAL FOR DETERMINING THE ISSUES EVEN OTHERWISE THE EXPLANATION OFFERED IN SUPPORT O F ADMISSION OF THE SAME I.E. THE ACUTE FINANCIAL NEED OF THE ASSESSEE PRIOR TO THE SALE ON ACCOUNT OF THE ASSESSEES FATHER SUFFERING FROM CANCER AND FINALLY SUCCUMBING TO THE DISEASE WHERE THE FINANCIAL NEEDS FOR THE TREATMENT ETC. WAS SOURCED FROM FRIENDS, RELATI VES AND THE AFORESAID UNCLE THUS THE RELEVANT DOCUMENT REMAINING WITH THE UNCLE IS NOT A FAR-FETCHED STORY AND IS AN ACCEPTABLE EXPLANATION. EVEN OTHERWISE, I FIND THAT THE CIT(A ) IN THE FACTS OF THE PRESENT CASE HAS NOT CARED TO ENSURE THAT COMPLIANCE IS MADE OF THE DIRE CTIONS GIVEN BY HIS PREDECESSOR CIT(A) DATED 08.12.2014 COMMUNICATED TO THE DVO THROUGH AO VIDE LETTER DATED 28.08.2014. A PERUSAL OF THE SAME SHOWS THAT THE SAID AUTHORITY W AS DIRECTED THAT THE ASSESSEE BE PROVIDED AN OPPORTUNITY OF BEING HEARD BY THE DVO B EFORE SUBMITTING THE FINAL REPORT WHICH ISSUE IS FOUND ADDRESSED VIDE GROUND NO.1.4 O F THE PRESENT PROCEEDINGS. THE SALE INSTANCE RELIED UPON BY THE ASSESSEE, IT IS FOUND H AVE ALSO NOT BEEN TAKEN INTO CONSIDERATION AS FOUND ADDRESSED IN GROUND NO.2.2. ACCORDINGLY IN VIEW OF THESE OBVIOUS AND PATENT DEFICIENCIES, THE IMPUGNED ORDER IS SET ASIDE AND THE ISSUES ARE RESTORED TO THE CIT(A) WITH THE DIRECTION TO ADMIT THE FRESH EVIDEN CES AND CONFRONT THE SAME TO THE AO BY WAY OF A REMAND REPORT. IN CASE THE DVOS REPORT IS RELIED UPON THEN AN OPPORTUNITY OF BEING HEARD TO THE ASSESSEE BY THE DVO BE PROVIDED BEFORE SUBMITTING A FINAL REPORT WHICH AS PER LAW IS REQUIRED TO BE CONFRONTED TO TH E ASSESSEE BEFORE THE PASSING OF THE PAGE 5 OF 5 I.T.A .NO.-4945/DEL/2016 ADITYA GUPTA VS ITO ORDER. SIMILARLY, THE SALE INSTANCE OF LAND IN THE VICINITY RELIED UPON BY THE ASSESSEE IN SUPPORT OF HIS PRAYER ARE EVIDENCES WHICH NEED TO B E ADDRESSED AND THE CIT(A) CANNOT AVOID ADJUDICATION ON THE PRAYER MADE AND THE EVIDE NCES FILED. ACCORDINGLY, IN VIEW OF THE ABOVE REASONING, THE IMPUGNED ORDER IS SET ASIDE AN D THE ISSUE IS RESTORED BACK TO THE CIT(A) WITH THE DIRECTION TO PASS A SPEAKING ORDER IN ACCORDANCE WITH LAW. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 15 TH OF FEBRUARY 2017. SD/- (DIVA SINGH) JUDICIAL MEMBER *AMIT KUMAR* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI