Bimal Orgo Chem Private Limited, Ahmedabad V. The Deputy Commissioner of Income Tax, Circle-1(1)(1), Ahmedabad

ITA 505/AHD/2017

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 2474 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 9 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-12-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Next Hearing Date: 04-12-2019
• Assessment Year: 2013-2014
• Appeal Filed On: 28-02-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Section: 271(1)(c)

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, AHMEDABAD BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI WASEEM AHMED, ACCOUNTANT MEMBER ITA NO. 505/AHD/2017 ASSESSMENT YEAR : 2013-14 BIMAL ORGO CHEM PVT. LTD., ROOM NO. 402, HEMKOOT BUILDING, ASHRAM ROAD, AHMEDABAD PAN : AAACB 7697 K VS DEPUTY COMMISSIONER OF INCOME-TAX, CIRCLE 1 (1)(1), AHMEDABAD / (APPELLANT) / (RESPONDENT) ASSESSEE BY : SHRI PARIMAL SINGH B. PARMAR, AR REVENUE BY : SHRI VIDHYUT TRIVEDI, SR DR / DATE OF HEARING : 04/12/2019 / DATE OF PRONOUNCEMENT: 05/12/2019 / O R D E R PER RAJPAL YADAV, JUDICIAL MEMBER :- THE PRESENT APPEAL IS DIRECTED AT THE INSTANCE OF T HE ASSESSEE AGAINST THE ORDER OF LEARNED CIT(A)-1, AHMEDABAD DATED 29 TH DECEMBER 2016 PASSED FOR ASSESSMENT YEAR 2013-14. 2. THE ASSESSEE HAS TAKEN FOUR GROUNDS OF APPEAL; O UT OF WHICH GROUND NO.2 IS A GENERAL GROUND OF APPEAL, WHICH DOES NOT CALL FOR RECORDING OF ANY SPECIFIC FINDING; HENCE REJECTED. 3. IN GROUND NOS. 3 & 4, THE ASSESSEE HAS CHALLENGE D LEVY OF INTEREST UNDER SECTION 234A/B/C/D OF THE ACT AND INITIATION OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT. AS FAR AS INITIATIO N OF PENALTY IS CONCERNED, THIS ISSUE IN THE PRESENT FORM IS PREMATURE. THE ASSESSE E WILL GET AN OPPORTUNITY TO INDEPENDENTLY CONTEST THE LEVY OF PENALTY. CHAR GING OF INTEREST IS CONCERNED, IT IS CONSEQUENTIAL IN NATURE; HENCE, BO TH THE GROUNDS ARE REJECTED. ITA NO. 505/AHD/2017 BIMAL ORGO CHEM PVT LTD VS. DCIT AY : 2013-14 2 4. IN GROUND NO.1 THE GRIEVANCE OF THE ASSESSEE IS THAT THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ADDITION OF RS.1 2,27,384/-. 5. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E HAS FILED ITS RETURN OF INCOME ON 24.09.2013 DECLARING TOTAL INCOME OF RS.8 ,89,20,991/-. THE ASSESSEE HAS SOLD ONE LAND AT BLOCK NO. 256, PLOT N O.237 FOR A CONSIDERATION OF RS.9 CRORES AND ACCORDINGLY THE CAPITAL GAIN INC OME OF RS.8,89,20,991/- HAS BEEN SHOWN IN THE RETURN OF INCOME. THE ASSESS ING OFFICER HAS OBSERVED THAT THERE WAS A FACTORY BUILDING ON THE L AND SOLD. AFTER TAKING DUE PERMISSION, THE ASSESSEE HAS SOLD IT TO SATYAM DEVELOPERS FOR A CONSIDERATION OF RS.9 CRORES. ACCORDING TO THE ASSE SSING OFFICER, A SUM OF RS.12,27,384/- HAS BEEN TRANSFERRED TO THE FACTORY BUILDING AND AMOUNT OF RS.8,84,21,549/- HAS BEEN TRANSFERRED TO THE PROFIT ON SALE OF LAND ACCOUNT. HE, THEREFORE, HARBORED A BELIEF THAT THE CAPITAL G AIN SHOWN BY THE ASSESSEE IS SHORT BY RS.12,27,384/-. WHEN HE CONFRONTED IT TO THE ASSESSEE, THEN IT WAS CONTENDED THAT NO FACTORY BUILDING WAS TRANSFERRED ONLY THE LAND WAS TRANSFERRED. THE CLERK HAS BY MISTAKE MADE AN ENTR Y; OTHERWISE IN THE SALE DEED IT HAS NOWHERE BEEN PROVIDED THAT SEPARATE CON SIDERATION TOWARDS FACTORY BUILDING WAS RECEIVED AMOUNTING TO RS.12,27 ,384/-. LEARNED ASSESSING OFFICER WITHOUT VERIFYING THESE FACTS MAD E AN ADDITION OF RS.12,27,384/-. 6. APPEAL TO THE LEARNED CIT(A) DID NOT BRING ANY R ELIEF TO THE ASSESSEE. BEFORE US, LEARNED COUNSEL FOR THE ASSESSEE CONTEND ED THAT THE ASSESSEE HAS SOLD ONLY LAND. NO AMOUNT WAS RECEIVED REPRESENTIN G THE SALE OF FACTORY BUILDING. THEREFORE, THERE SHOULD NOT BE ANY ADDIT ION ON ACCOUNT OF SHORT TERM CAPITAL GAIN AND ON SALE OF FACTORY BUILDING. ON THE OTHER HAND, LEARNED DEPARTMENTAL REPRESENTATIVE RELIED UPON THE ORDERS OF THE REVENUE AUTHORITIES. ITA NO. 505/AHD/2017 BIMAL ORGO CHEM PVT LTD VS. DCIT AY : 2013-14 3 7. WE HAVE DULY CONSIDERED THE RIVAL CONTENTIONS AND G ONE THROUGH THE RECORD CAREFULLY. WE FIND THAT WHEN THE ASSESSING OFFICER HAS CONFRONTED THE ASSESSEE ABOUT THE ENTRY IN THE BOOKS, THEN IT WAS SUBMITTED THAT SUCH AN ENTRY WAS BY-MISTAKE AND NO AMOUNT WAS RECEIVED BY THE AS SESSEE REPRESENTING SALE OF FACTORY BUILDING. THE ASSESSING OFFICER HAS NEIT HER VERIFIED THESE FACTS FROM THE ACCOUNTING DETAILS NOR FROM THE VENDEE. IT IS A QUESTION OF FACT WHETHER THE FACTORY BUILDING WAS ALSO SOLD FOR WHICH CONSIDERAT ION OF RS.12,27,384/- WAS RECEIVED. FROM THE SALE DEED, IT IS NOT DISCERNIBLE . THE SALE DEED IS ONLY FOR LAND. THERE IS NO MENTION ABOUT SALE OF FACTORY BU ILDING. IN THIS SITUATION, THERE SHOULD NOT BE AN ASSUMED CONSIDERATION OF RS. 12,27,384/- REPRESENTING SALE OF FACTORY BUILDING. TAKING INTO CONSIDERATION THE ABOVE FACTS, WE DEEM IT APPROPRIATE TO REMIT THIS ISSUE T O THE FILE OF THE ASSESSING OFFICER TO DETERMINE THE CORRECT AMOUNT OF GAIN ARI SING TO THE ASSESSEE ON SALE OF LAND ONLY. IF A SUM OF RS.12,27,384/- HAS BEEN TRANSFERRED TOWARDS SALE OF BUILDING, THEN IT IS TO BE FOUND OUT WHETHE R IT HAS BEEN EXCLUDED FROM THE ALLEGED RS.9 CRORES CONSIDERATION SHOWN FOR THE SALE OF LAND. AFTER VERIFYING ALL THESE FACTS, HE HAS TO READJUDICATE T HE CORRECT QUANTUM OF THE SALE CONSIDERATION RECEIVED BY THE ASSESSEE ON SALE OF THE LAND AND THEREAFTER HE WILL DETERMINE THE GAIN REQUIRED TO BE TAXED IN THE HANDS OF THE ASSESSEE. IN VIEW OF THE ABOVE DISCUSSION, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED FOR ST ATISTICAL PURPOSES. ORDER PRONOUNCED IN THE COURT ON 5 TH DECEMBER, 2019 AT AHMEDABAD. SD/- SD/- ( WASEEM AHMED ) (RAJPAL YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD, DATED 05/12/2019 *BT ITA NO. 505/AHD/2017 BIMAL ORGO CHEM PVT LTD VS. DCIT AY : 2013-14 4 / COPY OF THE ORDER FORWARDED TO : 1. ! / THE APPELLANT 2. '! / THE RESPONDENT. 3. & ( / CONCERNED CIT 4. ( ) ( / THE CIT(A)- 5. & , & , /DR,ITAT, AHMEDABAD, 6. 1 / GUARD FILE. / BY ORDER, TRUE COPY (ASSTT. REGISTRAR) & ITAT, AHMEDABAD 1. DATE OF DICTATION- 04.12.2019 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 04.12.2019 OTHER MEMBER 05.12.2019. 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S. - 05.12.2019 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 05.12.2019.. 5. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK05. 12.2019 6. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK . 7. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER 8. DATE OF DESPATCH OF THE ORDER