ITO, Jaipur V. SMT. KAMLA DEVI SHARMA, Jaipur

ITA 526/JPR/2011

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 82749 (ITAT-JAIPUR)
• Duration Of Justice: 3 year(s) 2 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-08-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 28-12-2011
• Assessment Year: 2007-2008
• Appeal Filed On: 30-05-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D C SHARMA
• Keywords: Capital asset; Additional evidence; Cost of acquisition
• Section: 54B; 2(14); 142(1); 144

Judgement Text

IN THE INCOMETAX APPELLATE TRIBUNAL JAIPUR BENCH: JAIPUR (BEFORE SHRI R.P. TOLANI AND SHRI T.R. MEENA) I.T.A. NO. 526/JP/2011 ASSTT. YEAR- 2007-08 PAN NO. BMXPK 7965 G THE I.T.O., SMT. KAMLA DEVI SHARMA, WARD 7(2), JAIPUR. VRS. W/O- SHRI NARAIN SAHAI S HARMA, VILLAGE- MUHANA, TEHSIL-SANGANER, DISTRICT- JAIPUR. (APPELLANT) (RESPONDENT) DEPARTMENT BY :- SHRI D.C. SHARMA. ASSESSEE BY :- WRITTEN SUBMISSION. DATE OF HEARING : 07/08/2014 DATE OF PRONOUNCEMENT : 28/08/2014 O R D E R PER: T.R. MEENA, A.M. THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER DATED 23/03/2011 OF THE LEARNED C.I.T.(A)-II, JAIPUR FOR T HE A.Y. 2007-08. THE SOLE GROUND OF APPEAL IS AGAINST THE LAND LOCATED IN KHA SRA NO. 319/320 IN SANJHARIA VILLAGE ON SANGANER TEHSIL WAS NOT A CAPITA L ASSET U/S 2(14) OF THE ACT. 2. THE ASSESSING OFFICER OBSERVED THAT THE ASSESSEE SOLD HER LAND TO M/S VATIKA LTD. ON 19/05/2006 FOR A SALE CONSIDERATION OF RS. 67,20,000/-. THE ASSESSEE WAS GIVEN FOUR NOTICES U/S 142(1) OF THE IN COME TAX ACT, 1961 ITA 526/JP/2011 ITO VS. SMT. KAMLA DEVI SHARMA 2 (HEREINAFTER REFERRED AS THE ACT), WHICH WERE PARTL Y COMPLIED WITH. WHEN THERE WAS NO COOPERATION FROM THE ASSESSEE, THE ASSESSING OFFICER ASSESSED THE ASSESSEES INCOME U/S 144 OF THE ACT. IT IS OBSERVE D BY THE LEARNED ASSESSING OFFICER THAT JAIPUR NAGAR NIGAM HAD SUPPLIED A SCAL ED MAP OF ITS MUNICIPAL LIMITS, FROM WHICH THE LAND IN DISPUTE, IN THE CASE WAS WITHIN 8 K.MS OF MUNICIPAL LIMITS OF JAIPUR NAGAR NIGAM. APART FROM THIS, THE LEARNED ASSESSING OFFICER ALSO MENTIONED THAT THE SAID LAND WAS ALSO WI THIN 8 KMS FROM BAGRU, A TOWN HAVING A POPULATION OF MORE THAN 10,000 AS PER THE CENSUS OF YEAR 2001. THESE FACTS WERE BROUGHT TO THE NOTICE OF THE ASSESSE E. IT WAS ALSO FOUND BY THE ASSESSING OFFICER THAT IN THE PAST ALSO, THE LA ND SOLD TO M/S VATIKA LTD. WAS TREATED AS A CAPITAL ASSET U/S 2(14) OF THE ACT BY THE THEN ASSESSING OFFICER, WHERE DETAILED FILED INQUIRIES WERE ALSO CONDUCTED IN THIS REGARD. AFTER CONSIDERING THE VARIOUS DETAILS PARTLY SUBMITTED BY THE ASSESSEE AND COLLECTED BY THE ASSESSING OFFICER DURING THE COURSE OF ASSES SMENT PROCEEDINGS, HE HELD THAT THE LAND SOLD BY THE ASSESSEE IS A CAPITAL ASS ETS AS ENVISAGED U/S 2(14) OF THE ACT. THE LEARNED ASSESSING OFFICER CONSIDERED SI MILAR CASE OF SHRI RAM NIWAS, SHRI JAGDISH PRASAD SHARMA AND SHRI RAMESHWAR SHARMA, WHICH WERE DECIDED BY HIM. THE COST OF ACQUISITION AS ON 01/4/2 981 WAS TAKEN AT RS. 4312.56 PER BIGHA. SINCE NO DETAILS REGARDING RATE OF LAND AS ON 01/4/1981 WAS FURNISHED BY THE ASSESSEE. THE ASSESSEE HAD SOLD PART OF LAND MEASURING TO 3.36 BIGHAS OF LAND. THE ASSESSING OFFICER CALCUL ATED LONG TERM CAPITAL GAIN ITA 526/JP/2011 ITO VS. SMT. KAMLA DEVI SHARMA 3 AT RS. 66,44,797/-. THE ASSESSEE CLAIMED EXEMPTION A T RS. 20,12,000/- AND EXPENDITURE AGAINST THE SALE PROCEEDS AT RS. 66,81, 020/- INCLUDING DEDUCTION U/S 54B AND 54D OF THE ACT. THE ASSESSING OFFICER OB SERVED THAT THE ASSESSEE WAS UNABLE TO BRING OUT ANY EVIDENCE REGARDING THE E XPENDITURE OF RS. 45,06,577/- OF THE ACT, THEREFORE, HE COMPUTED LONG TERM CAPITAL GAIN AT RS. 45,06,577/- AFTER ALLOWING THE EXEMPTION 54 OF THE A CT AT RS. 21,38,220/-. 3. BEING AGGRIEVED BY THE ORDER OF THE LEARNED ASSE SSING OFFICER, THE ASSESSEE CARRIED THE MATTER TO THE LEARNED CIT(A), WHO HAD ALLOWED THE APPEAL BY OBSERVING AS UNDER:- I HAVE CAREFULLY CONSIDERED THE FACTS OF THE CASE AND SUBMISSIONS OF LEARNED A.R. ON PERUSAL OF THE RELEVANT RECORDS, IT IS OBSERVED THAT THE MAIN ISSUE INVOLVED IN THIS GROUND OF APPEAL IS AS TO WHETHER THE LEARNED A.O. WAS JUSTIFIED IN ASSESSING THE APPELLA NTS TOTAL INCOME AT RS. 45,13,470/-, WHICH, WHICH INCLUDED AN AMOUNT OF R S. 45,06,577/- AS LONG TERM CAPITAL GAIN AND AN AMOUNT OF RS. 6,893/- AS INCOME FROM OTHER SOURCES (BANK INTEREST). IN THIS REGARD, IT I S SEEN THAT THE APPELLANT HAD SOLD HER AGRICULTURAL LAND, MEASURING 0.84 HECT ARES (BEARING KHASRA NO.319 AND 320 IN VILLAGE SANJHARIYA, TEHSIL SANGANE R, DISTRICT- JAIPUR FOR RS. 67,20,000/- TO M/S VATIKA LAND BASE PVT. LT D. ON 18/5/2006. FURTHER, IT IS SEEN THAT THE SAID AGRICULTURAL LAND WAS TREATED AS CAPITAL ASSET U/S 2(14)(III)(B) OF THE I.T. ACT, BY THE A.O. , ON THE GROUND THAT THE SAME WAS LOCATED WITH 8 KMS. OF THE LIMITS OF JAI PUR NAGAR NIGAM AND ACCORDINGLY, THE A.O. WORKED OUT THE LONG TERM C APITAL GAIN OF RS. 45,06,577/-, IN RESPECT OF SALE OF THE SAID AGRICUL TURAL LAND, IN THE APPELLANTS CASE. WHEREAS, ON THE OTHER HAND, LEARN ED A.R. HAS CLAIMED THAT THE AFORESAID AGRICULTURAL LAND WAS LOCATED BEY OND 8 KMS OF THE LIMITS OF JAIPUR NAGAR NIGAM AND HENCE, THE SAME WAS NOT A CAPITAL ASSET U/S 2(14) OF THE I.T. ACT. IN THIS REGARD, I F IND THAT AS MENTIONED EARLIER IN PARA 2.3 ABOVE, THE LEARNED A.O. HAS REP ORTED IN HIS REMAND ITA 526/JP/2011 ITO VS. SMT. KAMLA DEVI SHARMA 4 REPORT, BASED ON THE SPECIFIC REPORT OF THE CONCERN ED LAND REVENUE AUTHORITY, THAT THE AFORESAID AGRICULTURAL LAND SOL D BY THE APPELLANT WAS LOCATED AT A DISTANCE OF ABOUT 9 KMS. (I.E. MORE TH AN 8 KMS.) FROM THE LIMITS OF THE JAIPUR NAGAR NIGAM. THEREFORE, ON THES E FACTS, IT IS HELD THAT THE AGRICULTURAL LAND SOLD BY THE APPELLANT, I N QUESTION, CANNOT BE TREATED AS A CAPITAL ASSET U/S 2(14) OF THE I.T. AT AND CONSEQUENTLY, THE APPELLANT CANNOT BE MADE LIABLE FOR THE IMPUGNED LO NG TERM CAPITAL GAIN ON SALE OF SUCH AGRICULTURAL LAND. THUS, THE A.O. IS DIRECTED TO DELETE THE IMPUGNED ADDITION OF RS. 45,06,577/- MADE AS LONG T ERM CAPITAL GAIN, IN THE APPELLANTS CASE. FURTHER, AS THE LEARNED A.R. S MAIN ARGUMENT, CLAIMING THAT THE APPELLANT WAS NOT LIABLE TO ANY CA PITAL GAINS IN RESPECT OF SALE OF HER AGRICULTURAL LAND WHICH WAS NOT A CAPI TAL ASSET, HAS BEEN ACCEPTED, THE ALTERNATIVE ARGUMENTS, RELATING TO TH E DEDUCTIONS U/S 54 OF THE I.T. ACT, AS WELL AS THE ADDITIONAL EVIDENCES SUBMITTED IN SUPPORT THEREOF, HAVE BECOME INFRUCTUOUS AND THUS, THE SAME ARE REJECTED. HOWEVER, THE OTHER ADDITION OF RS. 6,893/- MADE AS I NCOME FROM OTHER SOURCES, IS CONFIRMED, BECAUSE THE APPELLANT HAS, U NDISPUTEDLY, EARNED INTEREST TO THAT EXTENT ON HER BANK DEPOSITS. CONSE QUENTLY, THIS GROUND OF APPEAL IS TREATED AS PARTLY ALLOWED. 4. NOW THE REVENUE IS IN APPEAL BEFORE US. 5. THE LEARNED D.R. SUPPORTED THE ORDER OF THE LEARN ED ASSESSING OFFICER. HOWEVER, THE APPELLANT HAS MADE WRITTEN REPLY AND SUB MITTED THAT THE LEARNED ASSESSING OFFICER HIMSELF ADMITTED SANJHARIYA VILLA GE ON THE BASIS OF REPORT OF REVENUE AUTHORITY AT A DISTANCE OF 9 KMS. THE SAME R EPORT WAS RECEIVED BY THE COMMISSIONER (APPEALS)-III, JAIPUR ON 21/3/2011 . THE LEARNED ASSESSING OFFICER QUOTED THE CASE OF SHRI LAL RAM SHARMA, WHIC H IS NOT APPLICABLE ON THE CASE OF THE ASSESSEE. THE REVENUE LAND OF SANJHARIA VILLAGE IS LOCATED AROUND THE VILLAGE HAVING DISTANCE FROM MUNICIPAL LIMIT OF KHASRA NO. 315 TO OTHER ITA 526/JP/2011 ITO VS. SMT. KAMLA DEVI SHARMA 5 MANY KHASARAS OF AGRICULTURAL LAND IN BETWEEN 7 KMS TO 12.5 KMS. THE LAND UNDER CONSIDERATION WAS LOCATED AT THE DISTANCE OF 9 KMS I.E. MORE THAN 8 KMS I.E. THE EXEMPTED LIMIT TO TREAT CAPITAL ASSET FOR CAPITAL GAIN CONSIDERATION. IN CASE OF LAL RAM SHARMAS APPEAL NO. 365/JPR/2009 -10 DATED 28/3/2011, THERE IS NO ANY REPORT OF TEHSILDAR CLARIFYING THE D ISTANCE MORE THAN 8 KMS BY QUOTING IRRELEVANT EXAMPLE NOT FULFILLING THE CONDI TIONS SIMILAR TO SMT. KAMALA DEVI IS MEANINGLESS AND HAVE NO NEGATIVE VALUE AGAI NST THE ASSESSEE. IT IS FURTHER ARGUED THAT TEHSILDAR OF JAIPUR NAGAR NIGAM HAD SENT A LETTER NO. 451 ON 14/2/2011 AND CLARIFIED THAT AGRICULTURAL LAND O F KHASRA NO. 319 AND 320 IN VILLAGE SANJHARIYA, TEHSIL SANGANER IS OUTSIDE THE MUNICIPAL LIMIT, WHICH ENDS ON LAST REVENUE VILLAGE HASAMPURA BAS BHAKROTA, KHA SRA NO. 315 IN WEST SIDE OF THIS VILLAGE. THE ASSESSEE KHASRA NUMBER IN VILLA GE SANJHARIYA IS SITUATED AT A DISTANCE OF 9 KMS FROM THE MUNICIPAL LIMIT. SHE F URTHER RELIED ON THE DECISION OF HONBLE ALLAHABAD HIGH COURT IN CASE OF CIT VS. S MT. SANJEEDA BEGUM (2006) 154 TAXMAN 346 AND PRAYED TO CONFIRM THE ORDE R OF THE LEARNED CIT(A). 6. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL AVAILABLE ON THE RECORD AS WELL AS GONE THROUGH THE WRITTEN RE PLY SUBMITTED BY THE ASSESSEE. ON PERUSAL OF EVIDENCE SUBMITTED ALONGWITH THE SUBMISSION REVEALED THAT THE TEHSILDAR, JAIPUR NAGAR NIGAM HAD CERTIFIED THAT BOTH THE KHASRAS NUMBERS ARE OUTSIDE LIMIT OF JAIPUR NAGAR NIGAM AND ARE SITUATED AT A DISTANCE ITA 526/JP/2011 ITO VS. SMT. KAMLA DEVI SHARMA 6 OF 9 KMS FROM THE OUTER LIMIT OF THE NIGAM. THE LEAR NED CIT(A) HAS CALLED REMAND REPORT FROM THE ASSESSING OFFICER WHO HAS ACC EPTED THE FACT OF THE CASE, THEREFORE, WE CONFIRM THE ORDER OF THE LEARNED CIT(A). ACCORDINGLY, WE DISMISS THE APPEAL OF THE REVENUE. 7. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D. ORDER PRONOUNCED IN THE OPEN COURT ON 28/08/2014. SD/- SD/- (R.P. TOLANI) (T.R. MEENA) JUDICIAL MEMBER ACCOUNTANT MEMBER JAIPUR, DATED : 28 TH AUGUST, 2014 * RANJAN COPY FORWARDED TO :- 1. THE ITO, WARD 7(2), JAIPUR. 2. SMT. KAMLA DEVI SHARMA, JAIPUR. 3. THE CIT (A) 4. THE CIT 5. THE D/R GUARD FILE (I.T.A. NO. 526/JP/2011) BY ORDER, AR ITAT JAIPUR.