ITO, Kota V. SHRI BABA LAKHVINDER SINGH, Kota

ITA 553/JPR/2012

• Counselvise Citation: 55323114 RSA 2012
• Duration Of Justice: 2 year(s) 6 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-12-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2008-2009
• Appeal Filed On: 06-06-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MRS NEENA JEEPH
• Keywords: Additional evidence
• Section: 54B; 148

Judgement Text

ITA NO. 553/JP/2012 THE ITO WARD- 2 (1) VS. BABA LAKHVINDER SINGH 1 IN THE INCOME TAX APPELLATE TRIBUNAL JAIPUR BENCH, JAIPUR (BEFORE SHRI R.P. TOLANI AND SHRI T.R. ME ENA) ITA NO. 553/JP/2012 ASSESSMENT YEAR: 2008-09 PAN : CVYPS 1642 F THE ITO VS. SHRI BABA LAKHVINDER SINGH WARD- 2 (1) S/O SHRI GURUDAYAL SINGH KOTA GURUDWARA AGAMGARH GRAM BADGAON, TEHSIL. LADPURA KOTA (APPELLANT) (RESPONDENT) DEPARTMENT BY: MRS. NEENA JEEPH ASSESSEE BY : SHRI P.C. PARWAL DATE OF HEARING: 30-10-2014 DATE OF PRONOUNCEMENT: 12-12-2014 ORDER PER R.P. TOLANI, JM THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF THE LD. LD. CIT(A), KOTA DATED 30-03-20129 WHEREIN THE REVENUE HAS RAISED FOLLOWING GROUND IN ITS APPEAL. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE , THE LD. CIT(A) HAS ERRED IN:- (I) REDUCING ADDITION OF RS. 1,08,24,248/- MADE BY AO ON ACCOUNT OF LONG TERM CAPITAL GAIN ACCRUING T O ASSESSEE RS. 50 LACS BY ACCEPTING THE CLAIM OF THE ASSESSEE FOR EXEMPTION OF RS. 50 LACS U/S 54B SINCE THE ASSESSEE HAD FAILE D TO PROVE THAT ITA NO. 553/JP/2012 THE ITO WARD- 2 (1) VS. BABA LAKHVINDER SINGH 2 HE HAD UTILIZED CAPITAL GAIN FOR PURCHASE OF AGRICU LTURAL LAND FOR RS. 50 LACS. 2.1 BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE I S HEAD PRIEST (HEAD GRANTHI) OF GURDWARA AGAMGARH, GRAM BADGAO, KOTA. T HE ASSESSEE HAD SOLD A LAND TO M/S. GURUMAHADEV BUILDCOM (P) LTD. T HROUGH ITS DIRECTOR SHRI BALDEV MONGA AMOUNTING TO RS. 84,23,027/-. THE STAMP DUTY VALUATION OF THIS PROPERTY WAS ADOPTED BY THE REGISTRAR AT RS . 1,23,50,000/-. ON THE BASIS OF THIS INFORMATION, THE AO ISSUED NOTICE U/S 148 OF THE ACT TO THE ASSESSEE. THE ASSESSEE VIDE LETTER DATED 15-12-2010 REPLIED AS UNDER:- 1. THAT I HAVE NOT SOLD ANY LAND TO ANYBODY AS I DID NOT OWN THE SAID LAND. 2. THAT I SIMPLY GOT EXECUTE4D THE SALE DOCUMENT AS A POWER OF ATTORNEY HOLDER OF MAJOR POORAN SINGH. 3. THUS, THE TAX LIABILITY IF ANY, ARISES THE SAME SHA LL BE THE RESPONSIBILITY OF THE SELLER. 4. I AM ENCLOSING HEREWITH A PHOTOSTAT COPY OF THE SALE DOCUMENT AS WAS AVAILABLE IN MY RECORDS FOR YOUR KIND PERUSA L. THE AO ASKED FURTHER QUESTION TO WHICH THE ASSESSEE REITERATED THE STAND THAT HIS ROLE IN THE SALE OF LAND WAS AS A ATTORNEY OF S AID MAJOR POORAN SINGH AND THE RESULTANT TAX LIABILITY IS PAYABLE BY HIM. ACCO RDING TO THE AO, THE ASSESSEE ATTENDED THE PROCEEDINGS ON 20-12-2010 AND ACCEPTED THAT HE HAD SOLD THE LAND AND HE WAS ACTUAL OWNER OF THE LAND A ND WAS READY TO PAY THE ITA NO. 553/JP/2012 THE ITO WARD- 2 (1) VS. BABA LAKHVINDER SINGH 3 TAX LIABILITY BY WAY OF CAPITAL GAIN. THE ASSESSEE DEPOSITED AN AMOUNT OF RS. 5.00 LACS ALSO ON 22-12-2010 U/S 140A OF THE ACT. T HUS IN VIEW OF THE ABOVE, THE ASSESSEE WAS HELD TO BE LIABLE FOR LONG TERM CAPITAL GAIN OF RS. 1,08,24,248/-. 2.2 AGGRIEVED, THE ASSESSEE PREFERRED FIRST APPEAL BEFORE THE LD. CIT(A) WHERE THE ADDITIONAL EVIDENCE WAS FILED TO THE EFFE CT THAT ASSESSEE HAVING REINVESTED THE CAPITAL GAINS IN PURCHASE OF AGRICUL TURAL LAND WAS ELIGIBLE FOR EXEMPTION U/S 54B WHICH MAY BE ALLOWED TO ASSESSEE IN ACCORDANCE WITH LAW. THE LD. CIT(A) FORWARDED THE SAME AND CALLED F OR THE REMAND REPORT OF THE AO WHICH WAS DULY SUBMITTED VIDE LETTER DATED 2 9-03-2012. THE EVIDENCE WAS ADMITTED AND IN CONSIDERATION OF THE RECORD, THE LD. CIT(A) HELD THAT THE ASSESSEE WAS ELIGIBLE FOR EXEMPTION U /S 54B AMOUNTING TO RS. 50 LACS BY FOLLOWING OBSERVATION. 5.22 DISCUSSION AND THE APPELLATE DECISIONS ON GROUND NOS. 1 & 2 THE ASSESSEE DID NOT PRESS THE GROUND OF APPEAL IN RELATION TO PROCEEDINGS U/S 147, ACCORDINGLY, THE SAME IS TREATED AS DISMISSED. REGARDING ADDITION OF RS. 84,23,027/-, THE ASSESSE E REQUESTED THAT THE ASSESSEE MAY BE ALLOWED EXEMPTIO N U/S 54B OF THE I.T. ACT AS ASSESSEE HAS INVESTED RS. 50,00, 000/- FOR PURCHASE OF AGRICULTURE LAND OUT OF SALE CONSIDERAT ION OF RS. 84,23,027/-. ITA NO. 553/JP/2012 THE ITO WARD- 2 (1) VS. BABA LAKHVINDER SINGH 4 IN THIS REGARD, THE ADDITIONAL EVIDENCE (IKRARNAMA FOR PURCHASE OF LAND) WAS ADMITTED AND THE A.O. WAS ASK ED TO SUBMIT HIS COMMENTS / REPORT AS PER RULE 46A OF THE I.T. ACT. THE A.O. VIDE LETTER DATED 29.03.2012 SUBMITTED AS UNDER:- IN THIS CONTEXT, IT IS SUBMITTED THAT I HAVE EXAM INED THE POSSESSION OF AGRICULTURE LAND AS STATED BY ASSESS EE 'PURCHASED BY HIM LOCATED AT KHASRA NO. 807 MEASURI NG 0.95 HECTARE AT BUNDI ROAD, KOTA AS ON DATE OF INSPECTIO N I.E. 28.03.2012 AND FOUND THAT THE SAID AGRICULTURE LAN D WAS ACTUALLY PURCHASED BY ASSESSEE ON 03-07-2008 (F.Y. 2008-09) AT KHASRA NO. 807 MEASURING 0.95 HECTARES LOCATED A T BUNDI ROAD, KOTA IN CONSIDERATION OF RS. 50,00,000/- AS P ER COPY OF AGREEMENT PROVIDED BY THE ASSESSEE DURING THE APPEA L PROCEEDING BEFORE YOUR HONOUR. IT IS FOUND THAT SUB SEQUENTLY THE SAID AGRICULTURE LAND HAS GOT TRANSFERRED TO TH E PURCHASER (ASSESSEE) VIDE REGISTERED DEED DATED 28.04.2010 (F .Y. 2010- 11) TREATING AS SALE CONSIDERATION DLC RATE AT RS. 64,92,658/ - AS PER COPY OF DEED PROVIDED BY THE ASSESSEE DURIN G THE APPEAL PROCEEDINGS BEFORE YOUR HONOUR AS ON 28.03.2012, TH E SAID LAND UNDER QUESTION IS IN POSSESSION OF GUNRDWARA AGAMGARH SAHIB, BUNDI ROAD, KOTA AND THERE IS CROP OF WHEAT STANDING WITH OWNERSHIP OF THE APPELLANT. IN THIS REGARD, IT IS ALSO SUBMITTED THAT THE ASSES SEE SOLD HIS AGRICULTURE LAND TO M/S GURU MAHADEV BUILD HO ME PVT. LTD. JAIPUR IN CONSIDERATION OF RS. 84,23,027/- AN D AS PER DLC RATE IT WAS TAKEN AT RS.1,23,50,000/- ON 26-06-200 7 (F.Y. 2007-08). SUBSEQUENTLY, THE ASSESSEE PURCHASED AN A NOTHER AGRICULTURE LAND ON 03-07-2008 (F.Y. 2008-09) IN CO NSIDERATION OF RS. 50,00,000/- WHICH HAS GOT REGISTERED ON 28-0 42010 (F.Y. 2010-11). THE ASSESSEE DID NOT TAKE/ OPEN ANY LONG TERM CAPITAL GAIN ACCOUNT WITH BANK.' FROM THE ABOVE, IT WAS SEEN THAT THE AO CONFIRMED THE CONTENTIONS OF THE ASSESSEE, HOWEVER POINTED OUT TH AT NO CAPITAL GAIN ACCOUNT WAS OPENED BY THE ASSESSEE. ITA NO. 553/JP/2012 THE ITO WARD- 2 (1) VS. BABA LAKHVINDER SINGH 5 AS PER SECTION 54B(2), THE ASSESSEE IS REQUIRED TO DEPOSIT UNUTILIZED AMOUNT IN CAPITAL GAIN SCHEME BEFORE FUR NISHING RETURN OF INCOME U/S 139(1). AS PER SECTION 139(1), THE DATE OF FILING RETURN IN THE CASE OF ASSESSEE WAS 31.07.200 8. THE ASSESSEE UTILIZED THE AMOUNT TOWARDS PURCHASE OF LA ND ON 03.07.2008. ACCORDINGLY, THE CONDITIONS MENTIONED U /S 54B WERE SATISFIED AND THERE WAS NO NEED TO DEPOSIT TH E AMOUNT IN CAPITAL GAIN ACCOUNT. IN VIEW OF THE ABOVE, IT IS HELD THAT ASSESSEE WAS ENTITLED TO RELIEF OF RS. 50,00,000/- U/S 54B OF THE I.T. AC T. THE AO IS DIRECTED TO ALLOW RELIEF OF RS. 50,00,000 /- U/S 54B OF THE I.T. ACT IN RELATION TO PURCHASE OF LAND . 2.3 AGGRIEVED, THE REVENUE IS BEFORE US; THERE IS N O GROUND ABOUT THE ADMISSION OF ADDITIONAL EVIDENCE; THE ONLY ISSUE CO NTENDED BY LD DR IS TO THE EFFECT THAT FROM THE DATE OF SALE OF AGRICULTUR AL LAND TILL THE INVESTMENT IN NEW AGRICULTURAL LAND AND FOR CLAIM U/S 54B OF TH E ACT, THE ASSESSEE WAS OBLIGED TO DEPOSIT THE AMOUNT IN CAPITAL GAIN ACCO UNT SCHEME. SINCE THIS CONDITION WAS NOT COMPLIED WITH, THEREFO RE, THE EXEMPTION U/S 54B IS NOT ELIGIBLE TO THE ASSESSEE. 2.4 THE LD. COUNSEL FOR THE ASSESSEE ON THE OTHER H ANDS CONTENDS THAT SECTION 54B(2) PROVIDES THAT EXEMPTION U/S 54B WILL BE ELIGIBLE IF THE CAPITAL GAINS ARE RE-INVESTED IN PURCHASE OF AGRICULTURAL L AND BEFORE DUE DATE OF FILING OF RETURN. IN CASE THE ASSESSEE DELAYS THE P URCHASE OF NEW AGRICULTURAL LAND BEFORE THE DUE DATE OF RETURN THAT IN THAT CAS E THE AMOUNT IS TO BE ITA NO. 553/JP/2012 THE ITO WARD- 2 (1) VS. BABA LAKHVINDER SINGH 6 DEPOSITED IN CAPITAL GAIN ACCOUNT SCHEME. IT HAS BE EN ACCEPTED BY THE AO IN THE REMAND REPORT THAT DUE DATE OF FILING OF THE RE TURN IN THE ASSESSEES CASE WAS 31-07-2008 AND THE ASSESSEE HAD PURCHASED ANOTH ER AGRICULTURAL LAND ON 03-07-2008 WHICH IS PRIOR TO DUE DATE OF FILING OF RETURN. THUS THE ORDER OF THE LD. CIT(A) IS PERFECTLY ON THE LINES OF PROVIS ION OF SECTION 54B OF THE ACT AND THE SAME IS RELIED ON BY THE LD. AR OF THE ASSESSEE. 2.5 WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. WE FIND MERIT IN THE ARGUMENTS OF THE LD. COUNSEL FOR THE ASSESSEE THAT SECTION 54B (2) PROVIDES TWO TYPE S OF INVESTMENT IN AGRICULTURAL LAND FOR CLAIM OF EXEMPTION. (I) EITHER THE ASSESSEE SHOULD REINVEST THE AMOUNT OF CAPITAL GAIN IN PURCHASE OF NEW LAND BEFORE THE DUE DATE OF FILING OF THE RETURN. (II) IF THE PURCHASE IS MADE AFTER DUE DATE OF FILI NG OF THE RETURN THEN THE AMOUNT SHOULD BE DEPOSITED IN THE C APITAL GAIN ACCOUNT SCHEME. THE DATE OF PURCHASE AND DUE DATE OF FILING OF RETU RN ARE NOT DISPUTED BY THE DEPARTMENT. THUS UNDER THESE CIRCUMSTANCES OF THE C ASE, THE CLAIM OF THE ASSESSEE ABOUT EXEMPTION SQUARELY FALLS IN THE FIRS T LIMB OF SECTION 54B (2) OF THE ACT. HENCE IN VIEW OF THESE FACTS AND CIRCUM STANCES OF THE CASE, WE ITA NO. 553/JP/2012 THE ITO WARD- 2 (1) VS. BABA LAKHVINDER SINGH 7 FIND NO INFIRMITY IN THE ORDER LD. CIT(A) WHO HAS H ELD THE ASSESSEE'S CASE TO BE COVERED IN THE FIRST LIMB OF SECTION 54B(2) OF T HE ACT. THUS THE ORDER OF THE LD. CIT(A) IS UPHELD AND REVENUES APPEAL IS DI SMISSED. 3.0 IN THE RESULT, THE APPEAL OF THE REVENUE IS DIS MISSED. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 12- 12-2014 SD/- SD/- (T.R. MEENA) (R.P. TOLANI) ACCOUNTANT MEMBER JUDICIAL MEMBER JAIPUR DATED: 12 TH DEC. 2014 *MISHRA COPY FORWARDED TO:- 1.THE ITO, WARD- 2 (1), KOTA 2. SHRI BABA LAKHVINDER SINGH, KOTA 3. THE LD. CIT(A) 4. THE LD. CIT BY ORDER 5..THE LD. DR 6.THE GUARD FILE (IT NO. 553JP/2012) AR ITAT, JAIPUR ITA NO. 553/JP/2012 THE ITO WARD- 2 (1) VS. BABA LAKHVINDER SINGH 8