MOOL CHAND SHARMA, Jaipur V. ITO, Jaipur

ITA 524/JPR/2014

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 2125 (ITAT-JAIPUR)
• Duration Of Justice: 2 year(s) 8 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-04-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2006-2007
• Appeal Filed On: 22-07-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJ MEHRA CIT DHK
• Keywords: Opportunity of being heard; Additional evidence; Cost of acquisition; Valuation report
• Section: 54B; 54F; 142(1); 144

Judgement Text

+VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES (SMC), JAIPUR JH HKKXPAN] YS[KK LNL; ] DS LE{K BEFORE: SHRI BHAGCHAND, ACCOUNTANT MEMBER VK;DJ VIHY LA-@ ITA NO. 524/JP/2014 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2006-07 MOOL CHAND SHARMA, VILLAGE- SARANGPURA, TEHSIL- SANGANER, JAIPUR. CUKE VS. INCOME TAX OFFICER, WARD 7(2), JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: BNBPS 2467 L VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI MANISH AGARWAL (CA) JKTLO DH VKSJ LS@ REVENUE BY : SHRI RAJ MEHRA (ADDL.CIT) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 06/04/2017 MN?KKS'K.KK DH RKJH[K @ DATE OF PRONOUNCEMENT : 11/04/2017 VKNS'K@ ORDER PER: BHAGCHAND, A.M. THIS IS AN APPEAL FILED BY THE ASSESSEE EMANATES FR OM THE ORDER DATED 12/06/2014 PASSED BY THE LD CIT(A)-III, JAIPU R FOR THE A.Y. 2006- 07, WHEREIN THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL:- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE T HE LD. CIT(A) HAS GROSSLY ERRED IN UPHOLDING THE ACTION OF THE LD.AO IN COMPLETING THE ASSESSMENT U/S 144 WITHOUT APPRECIATING THE FACT THAT NOTICE U/S 142(1) DATED 14.02.2007 AND 07.06.2007 REQUIRING THE ASSESSEE TO FILE HIS RETURN OF INCOME ALLEGEDLY SENT BY REGISTERED P OST WAS NEVER SERVED UPON THE ASSESSEE THUS THE SUBSEQUENT ITA 524/JP/2014_ MOOL CHAND SHARMA VS ITO 2 ASSESSMENT FRAMED U/S 144 FOR NON-COMPLIANCE OF NOTI CE IS INVALID, ILLEGAL AND BAD IN LAW AND DESERVES TO BE HOLD AS ANNULLED / CANCELLED MORE PARTICULARLY WHEN THE ASS ESSEE HAS ALREADY FILED THE RETURN OF INCOME 06.08.07 FOR WHICH NO COGNIZANCE WAS TAKEN. WITHOUT PREJUDICE TO GROUND NOS. 1 THE FOLLOWING G ROUNDS ARE TAKEN ON MERIT OF THE CASE: 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E THE CIT(A) HAS GROSSLY ERRED IN ENHANCING THE INCOME AT RS. 17,70,920/- ON ACCOUNT OF LONG TERM CAPITAL GAIN AS AGAINST THE ADDITION OF RS. 15,78,480/- MADE BY LD. AO, WITHOUT FOLLOWING THE PROCEDURE U/S 251(2) OF THE I NCOME TAX ACT, 1961. 2.1 THAT THE LD. CIT(A) HAS FURTHER ERRED IN ESTIMA TING THE COST OF ACQUISITION AT RS. 4,563/- AS AGAINST RS. 2,00,00 0/- CLAIMED BY THE ASSESSEE ARBITRARILY WITHOUT ANY BAS IS, THUS THE COST OF ACQUISITION BE TAKEN AT RS. 2,00,000/- FO R COMPUTING THE LONG TERM CAPITAL GAIN. 3. THE LD. CIT(A) HAS ERRED IN NOT ALLOWING THE DED UCTION U/S 54B OF THE INCOME TAX ACT, 1961 OF RS. 2,75,000/- CL AIMED BY THE ASSESSEE BEING INVESTMENT MADE IN AGRICULTUR E LAND OUT OF SALE PROCEEDS IN THE NAME OF HIS FAMILY MEMB ERS, THUS DEDUCTION AS CLAIMED DESERVES TO BE ALLOWED TO THE ASSESSEE. 4. THE LD. CIT(A) HAS ERRED IN NOT ALLOWING THE DED UCTION U/S 54F OF THE INCOME TAX ACT, 1961 ON ACCOUNT OF INVES TMENT IN CONSTRUCTION OF HOUSE PROPERTY, ARBITRARILY BY W RONGLY OBSERVING THAT THE CONSTRUCTION WAS STARTED IN 2009 AND FINISHED ON MAY, 2010 WHEN IN FACT AS PER VALUATION REPORT AT POINT NO. 41 IT IS CLEARLY STATED THAT CONSTRUCT ION WAS COMMENCED IN MAY 2005 AND FINISHED ON APRIL 2008 AN D DATE OF VALUATION REPORT IS 25.05.2010, THUS OBSERV ATION OF ITA 524/JP/2014_ MOOL CHAND SHARMA VS ITO 3 THE LD. CIT(A) BASED ON WRONG FACTS DESERVES TO BE IGNORED AND EXCLUDED AND DEDUCTION U/S 54F AS CLAIMED BY TH E ASSESSEE DESERVES TO BE ALLOWED. 2. IN THIS CASE, THE ASSESSMENT ORDER WAS PASSED EX PARTE DUE TO NON-APPEARANCE OF THE ASSESSEE. THE ASSESSING OFFICE R HAS OBSERVED IN HIS ASSESSMENT ORDER THAT SEVERAL OPPORTUNITIES FOR COMPLIANCE OF THE NOTICES WERE GIVEN TO THE ASSESSEE, BUT HE FAILED. TH EREFORE, HE ASSESSED TOTAL INCOME OF THE ASSESSEE AT RS. 16,28,480/-. 3. BEFORE THE LD. CIT(A) THE ASSESSEE HAS SUBMITTED ADDITIONAL EVIDENCE, WHICH WERE ADMITTED, HOWEVER, THE LD. CIT(A) HAS NOT PASSED A SPEAKING ORDER. THE ADDITIONAL EVIDENCES WERE NOT PRO PERLY APPRECIATED. 4. BEFORE THE TRIBUNAL, THE LD. AR OF THE ASSESSEE H AS SUBMITTED THAT THE ASSESSING OFFICER HAS DECIDED THE APPEAL EX PAR TE WITHOUT GIVING PROPER AND EFFECTIVE OPPORTUNITY OF HEARING. THE LD. CIT(A) HAS DECIDED THE APPEAL WITHOUT GOING INTO THE MERIT OF EVIDENCES , THEREFORE, HE PRAYED TO RESTORE THE MATTER BACK TO THE FILE OF TH E ASSESSING OFFICER. THE AR PLEADED THAT THE ASSESSING OFFICER MAY BE DIRECT ED TO GIVE PROPER AND EFFECTIVE OPPORTUNITY OF BEING HEARD. 5. ON THE CONTRARY, THE LD. SR. DR HAS VEHEMENTLY S UPPORTED THE ORDERS OF THE AUTHORITIES BELOW AND FURTHER SUBMITTE D THAT THE ASSESSING ITA 524/JP/2014_ MOOL CHAND SHARMA VS ITO 4 OFFICER HAD GIVEN SEVERAL OPPORTUNITIES TO THE ASSE SSEE BUT THE ASSESSEE DOES NOT WANT TO PURSUE HIS MATTER. THE LD. CIT(A) HAS RIGHTLY DECIDED THE APPEAL, THEREFORE HE PRAYED TO SUSTAIN THE ORDE R OF THE LD. CIT(A). 7. I HAVE HEARD BOTH THE PARTIES AND HAVE ALSO GON E THROUGH THE RECORDS. FROM PERUSAL OF THE RECORDS, IT TRANSPIRES THAT THE ASSESSING OFFICER GAVE OPPORTUNITY TO THE ASSESSEE. HOWEVER, T HERE IS NO EVIDENCE ON RECORD TO JUSTIFY OR CONFIRM THE FACT THAT ASSES SEE WAS PROVIDED ADEQUATE AND EFFECTIVE HEARING WITH REGARD TO THE DI RECTION SOUGHT AND PROVIDED. THE FACTS OF THE CASE SHOWS THAT THE ASSE SSEE HAS NOT BEEN PROVIDED AN EFFECTIVE OPPORTUNITY OF BEING HEARD WIT H REGARD TO DIRECTIONS ISSUED BY THE ASSESSING OFFICER, WHICH IS A MANDATOR Y REQUIREMENT OF LAW. THEREFORE, BY KEEPING IN VIEW OF ALL THESE FACTS, I RESTORE ALL THE ISSUES TO THE FILE OF THE ASSESSING OFFICER TO DECI DE DE NOVO AFTER GIVING ADEQUATE AND SUFFICIENT OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. THE ASSESSEE IS ALSO DIRECTED TO COOPERATE WITH THE ASSE SSING OFFICER IN DECIDING THE CASE IN ACCORDANCE WITH LAW. IF THE ASSE SSEE FAILS IN COOPERATING THE ASSESSING OFFICER THEN NO FURTHER O PPORTUNITY WOULD BE GIVEN TO HIM. ACCORDINGLY, THIS APPEAL IS RESTORE B ACK TO THE FILE OF THE ASSESSING OFFICER. ITA 524/JP/2014_ MOOL CHAND SHARMA VS ITO 5 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES ONLY. ORDER PRONOUNCED IN THE OPEN COURT ON 11/04/2017. SD/- HKKXPAN (BHAGCHAND) YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 11 TH APRIL, 2017. *RANJAN VKNS'K DH IZFRFYFI VXZSFKR @ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ @ THE APPELLANT- SHRI MOOL CHAND SHARMA, JAIPUR. 2. IZR;FKHZ @ THE RESPONDENT- THE ITO, WARD-7(2), JAIPUR. 3. VK;DJ VK;QDR @ CIT 4. VK;DJ VK;QDRVIHY @ THE CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ @ DR, ITAT, JAIPUR 6. XKMZ QKBZY @ GUARD FILE (ITA NO. 524/JP/2014) VKNS'KKUQLKJ @ BY ORDER, LGK;D IATHDKJ @ ASST. REGISTRAR