M/s Land & Acquisition Officer, Rajgarh V. The Income Tax Officer (TDS), Ujjain

ITA 561/IND/2010

• Counselvise Citation: 56122714 RSA 2010
• Duration Of Justice: 1 year(s) 1 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-10-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Next Hearing Date: 29-08-2011
• Assessment Year: 2004-2005
• Appeal Filed On: 01-09-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ARUN DEWAN
• Assessee Lawyers: MANOJ PHADNIS
• Keywords: Competent authority
• Section: 2(14)

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI R.C. SHARMA, ACCOUNTANT MEMBER ITA NOS.561 & 562/IND/2010 A.YS. 2004-05 & 2005-06 LAND & ACQUISITION OFFICER, KILCHIPUR, JEERAPUR DIST. RAJGARH (MP) PAN BPLSI 0888 D ... APPELLANT VS ITO(TDS), UJJAIN ... RESPONDENT APPELLANT BY : SHRI MANOJ PHADNIS DEPARTMENT BY : SHRI ARUN DEWAN, SR. DR DATE OF HEARING : 14.10.2011 DATE OF PRONOUNCEMENT : 14.10.2011 O R D E R PER JOGINDER SINGH THESE APPEALS ARE BY THE ASSESSEE CHALLENGING THE O RDER OF LEARNED COMMISSIONER OF INCOME TAX (APPEALS) DAT ED 2 9.7.2010 ON THE GROUND THAT THE LD. FIRST APPELLATE AUTHORITY ERRED IN HOLDING THAT THE ASSESSEE FAILED TO DEDUCT TAX AT SOURCE FROM THE COMPENSATION PAID FOR ACQUISITION OF AGRIC ULTURAL LAND U/S 194LA OF THE ACT ESPECIALLY WHEN THE SECTION SP ECIFICALLY EXEMPTS AGRICULTURAL LAND. 2. DURING HEARING OF THESE APPEALS, WE HAVE HEARD S HRI MANOJ PHADNIS, LD. COUNSEL FOR ASSESSEE AND SHRI AR UN DEWAN, LEARNED SR. DR. THE CRUX OF ARGUMENTS ON BE HALF OF THE ASSESSEE IS THAT THE IMPUGNED LAND FOR WHICH COMPENSATION WAS GIVEN IS AN AGRICULTURAL LAND, THE REFORE, THE COMPETENT AUTHORITY IS NOT SUPPOSED TO DEDUCT TDS. THE FACTUM OF ACQUISITION OF AGRICULTURAL LAND WAS NOT CONTROVERTED BY THE REVENUE. HOWEVER, THE LEARNED SR. DR DEFEND ED THE IMPUGNED ORDER. 2. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PER USED THE MATERIAL AVAILABLE ON FILE. BRIEF FACTS OF THE CASE ARE THAT SOME LAND WAS ACQUIRED BY THE GOVERNMENT. THE ITO, TDS, UJJAIN, SOUGHT INFORMATION FROM THE LAND ACQUISITIO N 3 OFFICER REGARDING PAYMENT OF RS. 1 LAC OR MORE MADE TO THE LAND OWNERS WHOSE LAND WAS ACQUIRED BY THE GOVERNME NT. THE ASSESSING OFFICER WAS OF THE VIEW THAT SINCE THE CO MPETENT AUTHORITY (LAND ACQUISITION OFFICER) WAS GUILTY OF NOT DEDUCTING TAX AT SOURCE U/S 201(1)/201(1A) OF THE ACT, HE DIR ECTED THE LAND ACQUISITION OFFICER TO DEPOSIT THE SAID AMOUNT . THE LAND ACQUISITION OFFICER WAS DIRECTED TO DEPOSIT RS.21,9 34/- (FOR THE ASSESSMENT YEAR 2004-05) AND RS. 24,66,064/- (FOR T HE ASSESSMENT YEAR 2005-06). THE STAND OF THE ASSESSEE WAS THAT SINCE THE LAND, IN QUESTION, WAS AGRICULTURAL LAND, THEREFORE, TDS WAS NOT REQUIRED TO BE DEDUCTED THEREON. THE ST AND OF THE ASSESSING OFFICER WAS AFFIRMED BY THE LEARNED COMMI SSIONER OF INCOME TAX (APPEALS) WHICH IS UNDER CHALLENGE BEFOR E THE TRIBUNAL. IN VIEW OF THESE FACTS, WE ARE REPRODUCI NG HEREUNDER SECTION 194LA OF THE ACT :- PAYMENT OF COMPENSATION ON ACQUISITION OF CERTAIN I MMOVABLE PROPERTY. 194LA. ANY PERSON RESPONSIBLE FOR PAYING TO A RESIDENT ANY SUM, BEING IN THE NATURE OF COMPENSATION OR THE ENHANCED COMPENSATION OR THE CONSIDERATION OR THE ENHANCED CONSIDERATION ON ACCOUNT OF COMPULSORY ACQ UISITION, UNDER ANY LAW FOR THE TIME BEING IN FORCE, OF ANY IMMOVABLE PROPERTY (OTHER THAN AGRICULTURAL LAND), SHALL, AT THE TIME OF PAYMENT OF SUCH SUM IN CASH O R BY ISSUE OF A CHEQUE OR DRAFT OR 4 BY ANY OTHER MODE, WHICHEVER IS EARLIER, DEDUCT AN AMOUNT EQUAL TO TEN PER CENT OF SUCH SUM AS INCOME-TAX THEREON: PROVIDED THAT NO DEDUCTION SHALL BE MADE UNDER THIS SECTION WHERE THE AMOUNT OF SUCH PAYMENT OR, AS THE CASE MAY BE, THE AGGREGATE AMOUNT OF SUCH PAYMENTS TO A RESIDENT DURING THE FINANCIAL YEAR DOES NOT EXCEED ONE HUNDRED THOUSAND RUPEES. EXPLANATION.FOR THE PURPOSES OF THIS SECTION, (I) AGRICULTURAL LAND MEANS AGRICULTURAL LAND IN INDIA INCLUDING LAND SITUATE IN ANY AREA REFERRED TO IN ITEMS (A) AND (B ) OF SUB-CLAUSE (III) OF CLAUSE (14) OF SECTION 2 ; (II) IMMOVABLE PROPERTY MEANS ANY LAND (OTHER TH AN AGRICULTURAL LAND) OR ANY BUILDING OR PART OF A BUILDING.] IF THE AFORESAID SECTION IS ANALYSED, WE FIND THAT SECTION 194LA CASTS OBLIGATION UPON ON A PERSON/COMPETENT AUTHORI TY DISTRIBUTING COMPENSATION TO DEDUCT TAX AT SOURCE I N RESPECT OF PAYMENT FOR IMMOVABLE PROPERTY, WHICH DOES NOT INCL UDE AGRICULTURAL LAND. THE MEANING OF AGRICULTURAL LAND AS GIVEN IN SECTION 2(14) CANNOT BE IMPORTED FOR THE PURPOSES O F SECTION 194LA OF THE ACT. OUR VIEW IS FORTIFIED FROM THE D ECISION OF THE HON'BLE KARNATAKA HIGH COURT IN MYSORE DEVELOPMENT AUTHORITY VS. ITO (2008) 175 TAXMAN 307 (KARN.). 3. IN VIEW OF THE ABOVE DISCUSSION, ASSESSING OFFIC ER IS DIRECTED TO VERIFY THE RESPECTIVE PAYMENTS MADE FOR ACQUISITION OF LAND AND IF IT IS FOUND THAT THE PAYMENT OF COMP ENSATION IS MADE FOR ACQUISITION OF LAND, THEN THE ACQUISITION OFFICER IS NOT 5 UNDER ANY OBLIGATION TO DEDUCT TDS THEREON. WE DIRE CT ACCORDINGLY. SINCE THE FACTS ARE IDENTICAL IN BOTH THE APPEALS, THEREFORE, THESE APPEALS OF THE ASSESSEE ARE ALLOWE D FOR STATISTICAL PURPOSES . FINALLY, THE APPEALS OF THE ASSESSEE ARE ALLOWED F OR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT AT THE CONCLUSI ON OF THE HEARING. SD SD (R.C.SHARMA) (JOGINDER SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 14.10.2011 COPY TO: APPELLANT, RESPONDENT, CIT, CIT(A), DR, GU ARD FILE DN/- 6