Sri.Ajai Joseph, Cochin V. The ITO(International taxation), Cochin

ITA 539/COCH/2015

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 7656 (ITAT-COCHIN)
• Duration Of Justice: 10 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-10-2016
• Appeal Filed By: Assessee
• Bench Allotted: DB
• Next Hearing Date: 13-10-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 02-12-2015
• Court: TRIBUNAL
• Department Lawyers: A DHANARAJ
• Assessee Lawyers: C B M WARRIER
• Keywords: Revised return
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN BEFORE SHRI GEORGE GEORGE K., JUDICIAL MEMBER I.T.A. NO. 539 /COCH/201 5 ASSESSMENT YEAR : 200 9 - 10 SHRI AJAI JOSEPH, DIRECTOR, M/S. CONSOLIDATED SHIPPING LINE INDIA (P) LTD., 37/1491-A, NETHAJI NAGAR, KADAVANTHRA P.O., ELAMKULAM, KOCHI-682 020. [PAN:AFLPJ 0176N] VS. THE ITO(INTERNATIONAL TAXATION-1) COCHIN. (ASSESSEE - APPELLANT) (REVENUE - RESPONDENT) ASSESSEE BY SHRI C.B.M. WARRIER, CA REVENUE BY SHRI A. DHANARAJ, SR.DR DATE OF HEARING 13/10 / 201 6 DATE OF PRONOUNCEMENT 14 TH /10/ 201 6 O R D E R PER GEORGE GEORGE K., JUDICIAL MEMBER THIS APPEAL AT THE INSTANCE OF THE ASSESSEE IS D IRECTED AGAINST THE ORDER OF THE CIT(A)-III, KOCHI DATED 07/09/2015. THE RELEVANT A SSESSMENT YEAR IS ASSESSMENT YEAR 2009-10. 2. THE GROUNDS RAISED BY THE ASSESSEE READS AS FOL LOWS:- 1. THE APPELLANT IS AJAI JOSEPH, COCHIN AND IN REGA RD TO AY 2009-10, THE ASSESSING OFFICER HAS WRONGLY ASSESSED THE CAPITAL GAIN IN RESPECT OF THE SALE OF PROPERTY BELONGING TO THE APPELLANTS WIFE AS APPEL LANTS INCOME AND COMMISSIONER OF INCOME TAX (APPEALS) HAS GONE WRONG IN CONFIRMING THE SAME. I.T.A. NO.539/COCH/2015 2 2. THE PROPERTY IS PURCHASED BY OWN SOURCES OF THE APPELLANTS WIFE AND HENCE THE FULL AMOUNT OF CAPITAL GAIN IS ASSESSABLE IN TH E CASE OF THE APPELLANTS WIFE AND CIT(APPEALS) HAS GONE WRONG IN UPHOLDING THE AS SESSMENT BY THE OFFICER. 3. FOR THE ABOVE REASON AND THE OTHER ARGUMENTS T HOSE MAY BE PUT FORWARD AT THE TIME OF HEARING THE APPELLANT MAY SUBMIT THA T THE FULL AMOUNT OF CAPITAL GAIN IS ASSESSABLE IN THE CASE OF APPELLANTS WIFE AND THE ASSESSMENT IN THE CASE OF APPELLANT MAY BE CANCELLED. 3. BRIEFLY STATED THE FACTS OF THE CASE ARE AS FO LLOWS: THE ASSESSEE, AN INDIVIDUAL IS AN NRI. THE RE TURN OF INCOME FOR THE ASSESSMENT YEAR 2009-10 WAS FILED ON 11/06/2009 DEC LARING TOTAL INCOME OF RS.4,50,650/-. THE ASSESSING OFFICER, IN THE COURS E OF ASSESSMENT PROCEEDINGS, NOTICED THAT FOR THE RELEVANT ASSESSMENT YEAR THE A SSESSEE AND HIS WIFE (SMT. SHINEY BLOSSOM JOSEPH) HAD JOINTLY SOLD A PROPERTY FOR A CONSIDERATION OF RS.37,65,600/-. THE ASSESSMENT WAS COMPLETED U/S. 143(3) OF THE ACT, VIDE ORDER DATED 22/12/2011. THE ASSESSING OFFICER HELD THAT THE ASSESSEE HAD NOT DISCLOSED THE CAPITAL GAIN IN THE RETURN OF INCOME AND BROUGH T TO TAX CAPITAL GAIN OF RS.5,66,672/- BEING 50% OF ASSESSEES SHARE. 4. AGGRIEVED, THE ASSESSEE PREFERRED APPEAL TO TH E FIRST APPELLATE AUTHORITY. IT WAS CONTENDED BEFORE THE FIRST APPELLATE AUTHORITY THAT THE IMPUGNED PROPERTY WAS PURCHASED WITH THE FUNDS PROVIDED BY THE ASSESSEES WIFE AND THEREFORE, THE ENTIRE CAPITAL GAIN WAS OFFERED IN THE HANDS OF HIS WIFE B Y FILING THE REVISED RETURN OF INCOME FOR THE CONCERNED ASSESSMENT YEAR. IT WAS S UBMITTED THAT THE ADDITION IN I.T.A. NO.539/COCH/2015 3 THE HANDS OF THE ASSESSEE IS NOT LEGALLY CORRECT. THE CIT(A), HOWEVER REJECTED THE CONTENTIONS AND DISMISSED THE APPEAL OF THE ASSESSE E. 5. AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFORE TH E TRIBUNAL. THE LD. AR SUBMITTED THAT THE WIFE OF THE ASSESSEE HAD PURCHAS ED THE PROPERTY AND HAD DISCLOSED THE ENTIRE CAPITAL GAIN IN HER HANDS. IT WAS SUBMITTED THAT THE LIABILITY TO TAX 50% OF THE CAPITAL GAIN IN THE HANDS OF THE ASS ESSEE AMOUNTS TO DOUBLE TAXATION. IT WAS PRAYED THAT IF ONE MORE OPPORTUNI TY IS PROVIDED, THE NECESSARY PROOF EVIDENCING THAT THE IMPUGNED PROPERTY WAS PUR CHASED OUT OF THE FUNDS OF THE ASSESSEES WIFE COULD BE FURNISHED . IT WAS SUBMITTED THAT IN THE INTEREST OF JUSTICE AND EQUITY THE MATTER MAY BE REMANDED TO TH E FILE OF THE ASSESSING OFFICER FOR DE NOVO CONSIDERATION. THE LD. DR WAS DULY HEA RD. 6. I HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED MATERIAL ON RECORD. ADMITTEDLY, IN THIS CASE, THE WIFE OF THE ASSESSEE HAD DECLARED THE ENTIRE CAPITAL GAIN IN HER REVISED RETURN AND PAID THE TAX ON THE SAME. THEREFORE, THERE IS DOUBLE TAXATION TO A CERTAIN EXTENT. IT IS THE CASE OF THE ASSESSEE THAT THE IMPUGNED PROPERTY HAS BEEN PURCHASED ENTIRELY OUT O F THE FUNDS OF HIS WIFE AND HENCE, THE LIABILITY OF 50% OF CAPITAL GAIN IN HIS HANDS IS UNJUSTIFIED. THIS CONTENTION OF THE ASSESSEE IS NOT SUPPORTED WITH NE CESSARY EVIDENCE ON RECORD. HOWEVER, SINCE THE WIFE OF THE ASSESSEE HAD ALREADY DISCLOSED THE ENTIRE CAPITAL GAIN IN HER RETURN OF INCOME, I AM OF THE VIEW THAT IN THE INTEREST OF JUSTICE AND I.T.A. NO.539/COCH/2015 4 EQUITY, ONE MORE OPPORTUNITY NEEDS TO BE GRANTED TO THE ASSESSEE TO PROVE THAT THE IMPUGNED PROPERTY IS PURCHASED ENTIRELY OUT OF THE FUNDS OF THE ASSESSEES WIFE AND NO CAPITAL GAIN IS LIABLE TO BE TAXED IN H IS HANDS. THEREFORE, THE ISSUE IS RESTORED TO THE FILE OF THE ASSESSING OFFICER. THE ASSESSING OFFICER SHALL DISPOSE OFF THE MATTER AFTER AFFORDING REASONABLE OPPORTUNITY O F HEARING TO THE ASSESSEE. IT IS ORDERED ACCORDINGLY. 7. IN THE RESULT, THE APPEAL FILED BY THE ASSES SEE IS ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON 14 TH -10-2016 SD/- (GEORGE GEORGE K.) JUDICIAL MEMBER PLACE: KOCHI DATED: 14 TH OCTOBER, 2016 GJ COPY TO: 1. SHRI AJAI JOSEPH, DIRECTOR,M/S. CONSOLIDATED SHI PPING LINE INDIA (P) LTD., 37/1491-A, NETHAJI NAGAR, KADAVANTHRA P.O., ELAMKULA M, KOCHI-682 020. 2. THE INCOME TAX OFFICER (INTERNATIONAL TAXATION-1 ), KOCHI. 3. THE COMMISSIONER OF INCOME-TAX(APPEALS)-III, KOC HI. 4. THE PRINCIPAL COMMISSIONER OF INCOME-TAX, KOCHI. 5. D.R., I.T.A.T., COCHIN BENCH, COCHIN. 6. GUARD FILE. BY ORDER (ASSISTANT REGISTRAR ) I.T.A.T., COCHIN I.T.A. NO.539/COCH/2015 5