ITO, New Delhi V. Tapash Kumar Chaterjee, New Delhi

ITA 5036/DEL/2013

• Counselvise Citation: 503620114 RSA 2013
• Duration Of Justice: 1 year(s) 8 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-05-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: H
• Next Hearing Date: 07-05-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 30-08-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: J P CHANDRAKER
• Assessee Lawyers: GINI GANDHI
• Keywords: Gift; Salary income; Additional evidence; Cost of acquisition; Revised return
• Section: 143(3); 54F

Judgement Text

ITA NO. 50 36 / DEL/ 2013 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH H , NEW DELHI BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI J.S. REDDY, ACCOUNTANT MEMBER I.T.A. NO. 50 36 /DEL/2013 A.Y. : 2009 - 10 INCOME TAX OFFICER, WARD 41(4), ROOM NO. 206, 2 ND FLOOR, B - BLOCK, CIVIC CENTRE, NEW DELHI VS. SH. TAPASH KUMAR CHATERJEE, A - 502, DEFENCE OFFICERS APARTMENTS, SECTOR - 4, PLOT 33, DWARKA, NEW DELHI 110 075 (PAN: AIPC9760B) (APPELLANT) (RESPONDENT) DEPARTMENT BY : SH. J.P. CHANDRAKER, SR. DR ASSESSEE BY : MS. GINI GANDHI, CA DATE OF HEARING : 08 - 05 - 201 5 DATE OF ORDER : 1 2 - 05 - 201 5 ORDER PER H.S. SIDHU : J M TH IS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE O RDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS ) - XXX, NEW DELHI DATED 03 . 6 .201 3 P ERTAINING TO ASSESSMENT YEAR 2009 - 10 ON THE FOLLOWING GROUNDS: - ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED IN 1. DELETING OF RS. 26,85,470/ - ON ACCOUNT OF CAPITAL GAIN CLAIMED AS EXEMPT WHIC H WAS NEVER DISCLOSED TO THE DEPARTMENT AND TREATING REVISED COMPUTATION OF ASSESSMENT PROCEEDINGS AFTER DETECTING THE SAME BY DEPARTMENT AS REVISED RETURN. ITA NO. 50 36 / DEL/ 2013 2 2. DELETING OF ADDITIONS OF RS. 10,25,000/ - MADE ON ACCOUNT OF UNEXPLAINED CASH DEPOSIT. 3. ACCEPTIN G ADDITIONAL EVIDENCE WITHOUT GRANTING EXTENSION OF TIME TO AO FOR SUBMISSION OF REPORT CALLED FOR WHICH IS IN CONTRAVENTION OF RULE 46A. THE APPELLANT CRAVES THE RIGHT TO ALTER, AMEND, ADD OR SUBSTITUTE THE GROUNDS OF APPEAL. 2. THE BRIEF FACTS OF T HE CASE ARE THAT THE RETURN DECLARING INCOME OF RS. 5,38,479/ - WAS FILED ON 21.8.2009.THE CASE WAS SELECTED FOR SCRUTINY THROUGH CASS/AIR. NOTICE U/S. 143(2) FIXING THE CASE FOR 15.9.2010 WAS ISSUED. AGAIN NOTICE U/S. 143(2) WAS ISSUED ON 4.10.2011/23.11. 2011 ON 30.11.2011 AND ON THE SAID DATE ASSESSEE S COUNSEL APPEARED BEFORE THE AO AND FILED THE PART DETAILS. IN THIS CASE THE ASSESSEE IS AN ARMY OFFICER AND FILED RETURN OF INCOME DECLARING ONLY SALARY INCOME. DURING THE ASSESSMENT PROCEEDINGS AO F OUND THAT THE ASSESSEE HAS SOLD ONE PLOT OF LAND AND BOOKED A FLAT CLAIMING FULL EXEMPTION ON ACCOUNT OF CAPITAL GAIN. ASSESSEE HA S NOT DISCLOSE D IT IN HIS RETURN OF INCOME TAX. THE ASSESSEE WAS ASKED TO FILE COPIES OF PURCHASE AND SALE DEEDS OF PROPERTIES, DETAILS OF BANKS AND ENTRIES FROM WHERE TRANSACTIONS TOOK PLACE, SHARE OF OWNERSHIP OF ASSESSEE AND HIS WIFE, DATE OF PAYMENTS TO BUILDER AND MATCHING ENTRIES IN BANK STATEMENT S, RECEIPTS COPIES FROM BUILDER AND STATEMENT OF AFFAIRS TO ASCERTAIN THE GENUINENESS OF THE ASSESSEE S CLAIM FOR EXEMPTION ON ACCOUNT OF CAPITAL GAIN. AO HAS FOUND THAT ONLY 69120/ - HAS BEEN PAID BY THE ASSESSEE AND THE LEASE DEED WAS IN THE NAME OF THE ASSESSEE AND MRS. BHARMAR CHATTERJEE WIFE OF THE ASSESSEE AS CO - OWNER. THE ASSESSEE FURNISHED TWO BANK ACCOUNTS ONE PUNJAB NATIONAL BANK AND ANOTHER ICICI BANK. ACCORDING TO THE AO THE PAYMENTS AND RECEIPTS ON ACCOUNT OF SALE AND PURCHASE OF PROPERTY ITA NO. 50 36 / DEL/ 2013 3 DID NOT MATCHES WITH THE SCHEDULES / DATE / AMOUNT OF PAYMENTS, WHICH ESTABLISHES THAT THE ASSESSEE IS EITHER HIDING ANOTHER BANK ACCOUNTS OR NOT FILING THE TRUE AND CORRECT POSITION REGARDING SALES AND PURCHASE. AO FURTHER OBSERVED THAT THE ASSESSSEE COULD N OT PROVE THE NEXUS BETWEEN SALE OF PROPERTY AND INVESTMENT OF THOSE FUND WITHIN THE TIME LIMIT PRESCRIBED TO CLAIM EXEMPTION U/S. 54F. AO ASKED THE ASSESSEE TO PROVIDE THE POSSESSION LETTER / ELECTRICITY / WATER BILL OF THE PROPERTY AS UNDER SECTION 54F OF THE I.T. ACT . AS PER AO THE COMPLETION OF CONSTRUCTION SHOULD BE COMPLETED WITHIN THREE YEAR OF TRANSFER OF ORIGINAL ASSET THAT IS FROM 1.4.2008 TO 31.3.2011 BUT THE ASSESSEE FAILED TO SUBMIT ANY PROOF OF COMPLETION OF THE PROPERTY B EFORE THE AO . A SSE SSEE HAS ALSO NOT PROVIDED THE CURRENT STATUS OF THE PROPERTY, ITS STAGE OF COMPLETION AND WHETHER HE IS STILL OWNER OF IT OR NOT . ASSESSEE DID NOT SUBMIT THE STATEMENT OF AFFAIRS, THEREFORE, AO OBSERVED THAT IT IS NOT POSSIBLE TO KNOW HOW MANY OTHER PROPE RTIES HE HAD INVESTED IN. SINCE ASSESSEE PROVIDED ONLY A PART OF SALE DEED OF PLOT, THEREFORE, IT WAS NOT POSSIBLE TO KNOW OTHER DETAIL SUCH AS HISTORY OF PLOT. IN VIEW OF ABOVE, AO COMPLETED THE ASSESSMENT BY MAKING VARIOUS ADDITIONS U/S. 143(3) OF TH E ACT VIDE ORDER DATED 28.12.2014. 3. BEING AGGRIEVED WITH THE ASSESSMENT ORDER DATED 28.12.2014, ASSESSEE APPEALED BEFORE THE LD. CIT(A), WHO VIDE IMPUGNED ORDER DATED 3.6.2013 HAS PARTLY ALLOWED THE APPEAL OF THE ASSESSEE. 4. NOW THE REVENUE IS AGGRIEV ED AGAINST THE IMPUGNED ORDER AND FILED THE PRESENT APPEAL BEFORE THE TRIBUNAL. 5. LD. SR. DR RELIED ORDER OF THE AO. ON THE OTHER HAND, LD. COUNSEL OF THE ASSESSEE RELIED UPON THE ORDER OF THE LD. CIT(A). ITA NO. 50 36 / DEL/ 2013 4 6. WE HAVE HEARD BOTH THE COUNSEL AND PERUSE D AND CONSIDERED THE RELEVANT RECORD AVAILABLE WITH US SPECIALLY THE IMPUGNED ORDERS PASSED BY THE REVENUE AUTHORITIES. 6.1 WITH REGARD TO GROUND NO. 1 REGARDING DELETION OF ADDITION OF RS. 26,85,470/ - ON ACCOUNT OF CAPITAL GAIN CLAIMED AS EXEMPT WHICH WAS NEVER DISCLOSED TO THE DEPARTMENT AND TREATING THE REVISED COMPUTATION WHICH WAS FILED BY THE ASSESSEE DURING THE COURSE O F ASSESSMENT PROCEEDINGS AFTER DETECTING THE SAME BY DEPARTMENT AS REVISED RETURN. WE FIND THAT LD. FIRST APPELLATE AUTHORITY HAS CONCLUDED THAT THE ADDITION OF RS. 2 6,85,470/ - ON ACCOUNT OF CAPITAL GAINS IS NOT JUSTIFIED AND IS EXCESSIVE. LD. CIT(A) H AS OBSERVED THAT TOTAL GAIN COMPUTATION WAS AS UNDER: - SALE CONSIDERATION RS. 41,76,000 LESS: INDEXED COST OF ACQUISITION RS. 13,59,081 RS. 28,16,919 LESS: EXEMPTION U/S. 54F ON ACCOUNT OF INVESTMENT OF RS. 56, 74,279/ - RS. 28,16,919 CAPITAL GAIN NIL AND / OR CAPITAL GAIN COMPUTATION OF ASSESSEE S SHARE WAS AS UNDER: - SALE CONSIDERATION RS. 20,88,000 LESS: INDEXED COST OF ACQUISITION RS. 6,79,540 RS. 14,08,4 60 LESS : EXEMPTION U/S. 54F ON ACCOUNT OF INVESTMENT OF RS. 30,56,000 RS. 14,08,460 CAPITAL GAIN NIL ITA NO. 50 36 / DEL/ 2013 5 6. 2 LD. CIT(A) HAS OBSERVED THAT THE CASE IS RIGHTY COVERED U/S. 49(1) OF THE I.T. ACT. THE COST OF ACQUISITION WHICH IS INDEXED I S TAKEN TO BE COST TO THE PREVIOUS OWNER. 6. 3 THE ASSESSEE HAD MADE THE TOTAL PAYMENT WITHIN THE TIME FRAME U/S. 54F OF AND THEREFORE, TRANSFER SHOULD BE DEEMED TO HAVE TAKEN PLACE. THE EXEMPTION U/S. 54F IS ALLOWABLE IN THE LIGHT OF THE FOLLOWING JUDGMENTS : - CIT VS. SARDARMAL KOTHARI [2008] 302 ITR 286 (MAD.) - CIT VS. SAMBANDAM UDAYKUMAR (2012) 81 CCH 151 KAR. HC - COMMISSIONER OF INCOME TAX VS. RL SOOD. HELD THAT MERELY BECAUSE THE BUILDER FAILED TO HAND OVER POSSESSION OF THE FLA T TO THE ASSESSEE WITHIN THE PERIOD, THE ASSESSEE CANNOT BE DENIED THE BENEFIT OF THE SAID BENEVOLENT PROVISION . 6. 4 KEEPING IN VIEW OF THE FACTS AND CIRCUMSTANCES AND PRECEDENTS, WE FIND THAT LD. CIT(A) HAS PASSED A REASONABLE ORDER ON THIS ISSUE BY DELETING THE ADDITION OF RS. 26,85,47 0 / - , WHICH DOES NOT NEED ANY INTERFERENCE ON OUR PART, HENCE, WE UPHOLD THE SAME BY DISMISSING THE GROUND NO. 1 RAISED BY THE REVENUE. 7. WITH REGARD TO GROUND NO. 2 REGARDING DELETION OF ADDITION OF RS. 10,25,000/ - M ADE ON ACCOUNT OF UNEXPLAINED CASH DEPOSIT IS CONCERNED, WE FIND THAT LD. CIT(A) HAS OBSERVED THAT THE OPENING CASH AS ON 1.4.2008 SHOULD BE DEEMED AS ACCEPTABLE. HE OBSERVED THAT GIFT FROM MOTHER IS FULLY SUBSTANTIATED AS COPIES OF HER INCOME TAX RETURNS OF LA S T AND RELEVANT YEAR ALONGWITH DOCUMENT EVIDENCE ITA NO. 50 36 / DEL/ 2013 6 OF SOURCE IS RIGHTLY PRODUCED. LD. CIT(A) FURTHER NOTED THAT THE CASH WITHDRAWN FROM THE BANK IS EVIDENCED BY THE BANK STATEMENT. WE FIND CONSIDERABLE COGENCY IN THE FINDING OF THE LD. CIT(A) THAT G IFT FROM MOTHER - IN - LAW DOES NOT SEEM VERY EXCESSIVE. CONSIDERING SHE OWNS A AGRICULTURAL LAND AS IS SUBSTANTIATE WITH THE DOCUMENTARY EVIDENCE. THEREFORE, THE CONCLUSION DRAWN BY THE LD. CIT(A) IS QUITE RIGHT IN DELETING THE ADDITION OF RS. 10,25,000/ - ON ACCOUNT OF UNEXPLAINED CASH. 7.1 KEEPING IN VIEW OF THE FACTS AND CIRCUMSTANCES, WE FIND THAT LD. CIT(A) HAS PASSED A WELL REASONED ORDER ON THIS ISSUE BY DELETING THE ADDITION OF RS. 10,25,000/ - , WHICH DOES NOT NEED ANY INTERFERENCE ON OUR PART, H ENCE, WE UPHOLD THE SAME BY DISMISSING THE GROUND NO. 2 RAISED BY THE REVENUE. 8 . WITH REGARD TO GROUND NO. 3 REGARDING ACCEPTING ADDITIONAL EVIDENCE WITHOUT GRANTING EXTENSION OF TIME TO AO FOR SUBMISSION OF THE REMAND REPORT, WHICH IS IN CONTRAVENTION OF RULE 46A IS CONCERNED, WE FIND THAT LD. CIT(A) HAS CALLED THE REMAND REPORT FROM THE ITO, WARD 41(4), DELHI VIDE HIS OFFICE LETTER DATED 26.2.2013, BUT TILL THE DATE OF APPELLATE ORDER I.E. 3.6.2013, THE AO DID NOT GIVE HIS REMAND REPORT WHICH IS MORE THAN 3 MONTHS. IN THIS REGARD, MS. GINI GANDHI, CA/ AR OF THE ASSESSEE ALSO PERSUADED THE AO FOR REMAND REPORT BUT COULD NOT GET IT TOO AND THEN MS. GINI GANDHI REQUESTED FOR DISPOSAL OF THIS APPEAL. IN THIS REGARD, THE ASSESSEE S SUBMISSIONS BEFO RE THE LD. CIT(A) WERE A S UNDER: - ITA NO. 50 36 / DEL/ 2013 7 'PLEASE DISPOSE OF THE APPEAL AFTER GIVING THE OPPORTUNITY FOR HEARING AND ON THE BASIS OF THE SUBMISSIONS ATTACHED ALONG WITH THE WRITTEN SUBMISSION EARLIER GIVEN DATED 26 - 02 - 2013. IT IS BROUGHT TO YOUR GOODSELF THAT THE APPELLANT'S A.R HAD LAST HEARING WITH YOU ON 26 - 02 - 2013, WHERE AFTER YOU HAD DIRECTED FOR REMAND REPORT FROM THE CONCERNED A.O. THE CONCERNED ASSESSING OFFICER SEND LETTER FOR CLARIFICATIONS VIDE LETTER DATED 18 - 03 - 2013 AND THEREAFTER VIDE LETTER DATED 09 - 05 - 2013 GIVING DATE OF HEARING FOR 29 - 03 - 2013 AND 20 - 05 - 2013 RESPECTIVELY. THE REPLIES OF THE SAME WERE GIVEN VIDE LETTERS DATED 08 - 04 - 2013 AND 20 - 05 - 2013. IN SPITE OF CONTINUOUS PERUSAL WITH THE CONCERNED OFFICER THE REMAND REPORT HAS NOT BEEN SENT TILL D ATE TO YOUR OFFICE. THE APPELLANT IS REALLY FACING FINANCIAL DIFFICULTIES AS HE HAS ALREADY DEPOSITED A PORTION OF TAX DUE AND HIS ACCOUNT IS ALSO ATTACHED BY THE INCOME TAX DEPARTMENT AGAINST THE DEMAND DUE. BECAUSE THE APPELLANT HAS BEEN COOPERATIVE IN F ILING SUBMISSIONS YOUR GOODSELF MAY CONSIDER THE SAME ON MERITS AND DECIDE ACCORDINGLY.' 8.1 WE FIND THAT LD. CIT(A) HAS CONCLUDED THAT THE APPEAL BE DISPOSED OFF ON THE RECORDS AVAILABLE AS IT HAS BEEN AROUND 3 MONTHS AND NO REPORT HAS BEEN RECEIVED FILL DATE AND FURTHER THERE DOES NOT SEEM TO BE ANY DELAY FROM THE A SSESSEE DURING REMAND PROCEEDINGS . FROM THE ABOVE, WE DO NOT FIND ANY VIOLATION ON THE ITA NO. 50 36 / DEL/ 2013 8 PART OF THE LD. CIT(A) UNDER RULE 46A. IN THE BACKGROUND OF THE AFORESAID FACTS AND CIRCUMSTANCES, WE FIND THAT LD. CIT(A) HAS PASSED A WELL REASONED ORDER ON THE ISSUE IN DISPUTE, WHICH DOES NOT NEED ANY INTERFERENCE ON OUR PART, HENCE, WE UPHOLD THE SAME BY REJECTING THE GROUND NO. 3 RAISED BY THE REVENUE. 9 . IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 1 2 /0 5 /2015. S D / - S D / - [ J.S. REDDY ] [ H.S. SIDHU ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATE 1 2 / 5 /201 5 SRBHATNAGAR COPY FORWARDED TO: - 1. APPELLANT - 2. RESPONDENT - 3. CIT 4. CIT (A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR, ITAT, DELHI BENCHES ITA NO. 50 36 / DEL/ 2013 9