MAHENDRA L. SHAH (HUF), MUMBAI V. ITO 21(1)-3, MUMBAI

ITA 5308/MUM/2011

• Counselvise Citation: [2012] 119 COUNSELVISE.COM (IT) 8769 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 2 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-09-2012
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 18-09-2012
• Assessment Year: 2007-2008
• Appeal Filed On: 13-07-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Opportunity of being heard

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL 'B' BENCH, MUMBAI BEFORE SHRI D. MANMOHAN, VICE PRESIDENT AND SHRI RAJENDRA, ACCOUNTANT MEMBER ITA NO. 5308/MUM/2011 (ASSESSMENT YEAR: 2007-08) MAHENDRA L. SHAH (HUF) INCOME TAX OFFICER - 21(1)-3 A-11, 4TH FLOOR, MAJITHIA APTS ROOM NO. 605, PRATYA KSHAKAR ABOVE IRLA NURSING HOME, IRLA VS. BHAVAN, B.K.C., BANDRA (E) VILE PARLE (W), MUMBAI 400056 MUMBAI 400051 PAN - AAAHM 6182 K APPELLANT RESPONDENT APPELLANT BY: NONE RESPONDENT BY: SHRI SANDEEP GOEL DATE OF HEARING: 18.09.2012 DATE OF PRONOUNCEMENT: 18.09.2012 O R D E R PER D. MANMOHAN, V.P. THIS APPEAL IS FILED AT THE INSTANCE OF THE ASSESSE E HUF AND IT IS DIRECTED AGAINST THE ORDER DATED 27.04.2011 PASSED BY THE CIT(A)-32, MUMBAI. 2. ASSESSMENT OF PROFIT OF ` 28,85,820/- ON SALE OF LAND IS THE SUBJECT MATTER OF DISPUTE BEFORE US. NONE APPEARED ON BEHALF OF TH E ASSESSEE. HOWEVER, WRITTEN SUBMISSIONS DATED 17 TH SEPTEMBER, 2012 WERE FILED WITH A REQUEST TO DECIDE THE MATTER IN ACCORDANCE WITH LAW. THEREFORE WE HAVE CAREFULLY GONE THROUGH THE WRITTEN SUBMISSIONS AND ALSO HEARD THE LEARNED D.R. 3. THE FACTS IN SHORT ARE THAT THE ASSESSEE HUF DECLAR ED LONG TERM CAPITAL GAINS ON SALE OF AGRICULTURAL LAND AT KILA PARDI. ACCORDING TO THE ASSESSEE THE AGRICULTURAL LAND WAS SOLD FOR A CONSI DERATION OF ` 30,00,000/- AND HENCE IT WAS EXEMPT FROM CAPITAL GAIN TAX. IN S UPPORT OF ITS CONTENTION ITA NO. 5308/MUM/2011 MAHENDRA L. SHAH (HUF) 2 THAT IT WAS AN AGRICULTURAL LAND, THE REPRESENTATIV E OF THE ASSESSEE VIDE LETTER DATED 21.11.2009, SUBMITTED THAT AS PER 7/12 EXTRAC T IT WAS AGRICULTURAL LAND SINCE THE LAND WAS USED FOR AGRICULTURAL PURPO SES. IN OTHER WORDS IT SATISFIES THE CONDITIONS PRESCRIBED IN SECTION 2(1A ) R.W.S. 2(14)(III)(A). 4. IT MAY BE NOTICED HERE THAT AS PER THE ABOVE MENTIO NED PROVISIONS MERE AGRICULTURAL OPERATIONS ALONE WILL NOT SATISFY THE TEST OF IT BE CONSIDERED AS AGRICULTURAL LAND SINCE THE PRIMARY CONDITION IS THAT IT SHOULD BE BEYOND 8 KMS FROM THE MUNICIPAL LIMITS. IN THIS REGARD THE ASSESSEE SUBMITTED A CERTIFICATE FORM THE CITY SURVEY OFFICE OF PARDI MU NICIPALITY CERTIFYING THAT THE AGRICULTURAL PROPERTY IS OUTSIDE THE CITY LIMIT S OF MUNICIPALITY. 5. THE AO DEPUTED THE WARD INSPECTOR TO COLLECT NECESS ARY DOCUMENTS FROM THE LAND AUTHORITY AT PARDI. THE TALATHI OF PA RDI PROVIDED A MAP TO IDENTIFY THE LOCATION OF THE LAND AND ALSO CONFIRME D IN WRITING THAT THE AFORESAID LAND WAS SITUATED AROUND 2 KMS FROM THE M UNICIPAL LIMITS OF PARDI. WHEN THE SAME WAS PUT TO THE ASSESSEE IT WAS STATED THAT THE KARTA OF THE HUF IS NOT STAYING IN PARDI SINCE HE HAS GONE F OR EMPLOYMENT IN DUBAI, HENCE OTHER THAN RELYING UPON THE CERTIFICATE FROM THE CITY SURVEYOR HE HAS NOTHING MORE TO ADD. 6. THE AO OBSERVED THAT IN THE LIGHT OF THE CERTIFICAT E ISSUED BY THE TALATHI THE LAND IS WITHIN 8 KMS FROM THE NEAREST M UNICIPALITY AND HENCE THE INCOME EARNED ON SALE OF THE SAID LAND IS NOT E XEMPT FROM TAX. HE ACCORDINGLY BROUGHT TO TAX ` 28,85,820/- UNDER THE HEAD LONG TERM CAPITAL GAINS. 7. AGGRIEVED ASSESSEE CONTENDED BEFORE THE CIT(A) THAT THE CLARIFICATION GIVEN BY THE TALATHI VIDE LETTER DATED 29.12.2009 W AS ACCEPTED BY THE AO IN HURRY BY PASSING AN ORDER ON 31 ST DECEMBER, 2009 SINCE THE ASSESSMENT WAS GETTING BARRED BY LIMITATION AND HENCE THE ASSE SSEE WAS NOT GIVEN REASONABLE OPPORTUNITY OF BEING HEARD. THE CERTIFIC ATE ISSUED BY THE CITY SURVEY SUPERINTENDENT WAS AGAIN PLACED BEFORE THE C IT(A) TO CONTEND THAT THE IMPUGNED LAND IS OUTSIDE THE MUNICIPAL LIMITS. ITA NO. 5308/MUM/2011 MAHENDRA L. SHAH (HUF) 3 8. THE LEARNED CIT(A) OBSERVED THAT THE AO HAS PUT TO THE ASSESSEE THE INFORMATION GATHERED BY HIM BY SPECIFICALLY POINTIN G OUT THAT IN THE WAKE OF THE CERTIFICATE FROM THE TALATHI OF PARDI THE ASSES SEE HAS TO PROVE THAT THE SAID LAND WAS OUTSIDE THE MUNICIPAL LIMITS OF PARDI BUT THE ASSESSEE COULD NOT FURNISH ANY DOCUMENT. HE FURTHER NOTED THAT THE LETTER ISSUED BY THE SURVEYOR MERELY SAYS THAT THE LAND IS OUTSIDE THE M UNICIPAL LIMITS BUT DOES NOT SPEAK OF THE DISTANCE FROM THE MUNICIPAL LIMITS , I.E. WHETHER IT IS BEYOND 8 KMS OR LESS THAN 8 KMS, HENCE IT CANNOT BE TAKEN AS AN EVIDENCE TO PROVE THAT IT IS AN AGRICULTURAL LAND WITHIN THE MEANING OF THE I.T. ACT. HAVING REGARD TO THE CIRCUMSTANCE OF THE CASE THE LEARNED CIT(A) CONFIRMED THE ORDER PASSED BY THE AO. 9. FURTHER AGGRIEVED, ASSESSEE IS IN APPEAL BEFORE US. IT IS STATED THAT IN THE LIGHT OF THE LETTER ISSUED BY THE CITY SURVEY O FFICE, VAPI HAVING ITS OFFICE AT PARDI, THE IMPUGNED LAND HAS TO BE TREATED AS AN AGRICULTURAL LAND AND IF THE AO OR THE CIT(A) HAVE ANY DOUBT AS TO THE DISTA NCE FROM THE MUNICIPAL LIMIT, FRESH INFORMATION COULD HAVE BEEN CALLED FOR OR THE CIT(A) COULD HAVE CALLED FOR REMAND REPORT. 10. ON THE OTHER HAND, THE LEARNED D.R. STRONGLY RELIED UPON THE ORDERS PASSED BY THE TAX AUTHORITIES. 11. WE HAVE CAREFULLY PERUSED THE RECORD. IT IS WELL SE TTLED THAT IN ORDER TO CLAIM EXEMPTION FROM TAX THE ASSESSEE HAS TO PROVE THAT THE LAND SOLD BY THE ASSESSEE IS AN AGRICULTURAL LAND BEYOND 8 KMS FROM THE MUNICIPAL LIMITS. IN THE INSTANT CASE NO SUCH EVIDENCE WAS FURNISHED BY THE ASSESSEE EITHER BEFORE THE AO OR BEFORE THE CIT(A) EXCEPT MERELY SU BMITTING THAT THE AGRICULTURAL LAND FALLS OUTSIDE THE MUNICIPAL LIMIT S. AGRICULTURAL LAND FALLING OUTSIDE THE MUNICIPAL LIMITS IS NOT AUTOMATICALLY E XEMPT UNLESS IT IS BEYOND 8 KMS FROM THE BOUNDARIES OF THE NEAREST MUNICIPALI TY. THE CERTIFICATE ISSUED BY THE TALATHI OF PARDI CATEGORICALLY STATES THAT IT IS WITHIN 2 KMS FROM THE MUNICIPAL LIMITS AND IN THE ABSENCE OF ANY INFORMATION CONTRADICTING THE CONTENTS OF THE AFOREMENTIONED CE RTIFICATE WE ARE OF THE VIEW THAT THE ORDER PASSED BY THE CIT(A) DOES NOT C ALL FOR ANY INTERVENTION. ITA NO. 5308/MUM/2011 MAHENDRA L. SHAH (HUF) 4 UNDER THE CIRCUMSTANCES, AS PRONOUNCED IN THE OPEN COURT, THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 18TH SEPTEMBE R 2012. SD/- SD/- (RAJENDRA) (D. MANMOHAN) ACCOUNTANT MEMBER VICE PRESIDENT MUMBAI, DATED: 18 TH SEPTEMBER 2012 COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 32, MUMBAI 4. THE CIT 21, MUMBAI CITY 5. THE DR, B BENCH, ITAT, MUMBAI BY ORDER //TRUE COPY// ASSISTANT REGISTRAR ITAT, MUMBAI BENCHES, MUMBAI N.P.