The Income Tax Officer, IV(2), Jalandhar V. Sh Jagjit Chaudhary ,S/o Sh. Gurbanta Singh, Jalandhar

ITA 563/ASR/2015

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 8820 (ITAT-AMRITSAR)
• Duration Of Justice: 3 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-02-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2007-2008
• Appeal Filed On: 02-11-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R K SHARDA
• Assessee Lawyers: RAVISH SOOD
• Section: 54F; 263

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR BEFORE SH. A.D.JAIN, HONBLE JUDICIAL MEMBER AND SH. T.S. KAPOOR, HONBLE ACCOUNTANT MEMBER I.T.A NO.563(ASR)/2015 ASSESSMENT YEAR: 2007-08 THE INCOME TAX OFFICER, IV(2), JALANDHAR. VS. SHRI JAGJIT SINGH CHAUDHARY S/O SH. GURBANTA SINGH, VPO DHALIWAL, TEHSIL & DISTRICT. JALANDHAR THROUGH L/H SH. SURINDER SINGH CHAUDHARY. PAN:CFNPS4917N (APPELLANT) (RESPONDENT) APPELLANT BY: SH. R.K. SHARDA (DR.) RESPONDENT BY: SH. RAVISH SOOD (ADV.) DATE OF HEARING: 24.02.2016 DATE OF PRONO UNCEMENT: 29.02.2016 ORDER PER T. S. KAPOOR (AM): THIS IS AN APPEAL FILED BY THE REVENUE AGAIN ST THE ORDER OF LEARNED CIT(A), JALANDHAR, DATED 27.08.2015, FOR THE ASST. YEAR 2007-08. 2. THE FOLLOWING GROUNDS OF APPEAL HAS BEEN TAKEN B Y THE REVENUE. (I) THAT THE LD. CIT(A) HAS ERRED IN LAW ON FACT S OF THE CASE IN DELETING THE ADDITION OF LONG TERM CAPITAL GAIN OF RS.1,49,25,000/- FOLLOWING THE DECISION OF HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF SHRI C.S. ATWAL AND OTHER VS. CIT IN IT A NO.200 OF 2013 WHICH HAS NOT ATTAINED FINALITY BEING CHALLENG ED IN SLP IN HONBLE SUPREME COURT BY THE DEPARTMENT . (II) IT IS PRAYED THAT THE ORDER OF THE LD. COMMI SSIONER OF INCOME TAX(APPEALS) BE SET ASIDE AND THAT OF THE ASSESSING OFFICER BE RESTORED. ITA NO.5 63(ASR)/2015 ASST. YE AR: 2007-08 2 3. THE BRIEF FACTS OF THE CASE AS NOTED IN THE ORDE R OF CIT(A) ARE THAT THE ASSESSEE IS A MEMBER OF HOUSING SOCIETY OF MLAS AND EX MLAS, NAMED AS THE PUNJABI CO-OPERATIVE HOUSE BUILDING SO CIETY LTD. MOHALI AND THE SOCIETY IN A TRIPARTITE JOINT DEVELOPMENT A GREEMENT WITH M/S HASH BUILDERS (PVT.) LIMITED, CHANDIGARH AND TATA H OUSING DEVELOPMENT COMPANY HAD ENTERED INTO AN AGREEMENT B Y WHICH THE SOCIETY WOULD TRANSFER ITS LAND FOR DEVELOPMENT IN LIEU OF MONETARY CONSIDERATION AND ALSO CONSIDERATION IN KIND TO THE MEMBERS OF THE SOCIETY. SINCE ASSESSEE WAS ALSO A MEMBER OF THE SA ID SOCIETY AND THE TOTAL CONSIDERATION WITH ASSESSEE WAS SETTLED AT RS .82,50,000/- IN CASH PLUS ALLOTMENT OF ONE FLAT OF 2250 SQ. FEET OF AREA VALUING AT RS.1,01,25,000/- OUT OF WHICH ASSESSEE HAD RECEIVED PART PAYMENT DURING THE YEAR UNDER CONSIDERATION. THE ASSESSEE D ID NOT DECLARE CAPITAL GAINS ON THE SALE OF SUCH LAND AND THEREFOR E, THE CASE OF THE ASSESSEE WAS REOPENED U/S 147, HOWEVER, THE REASSES SMENT WAS COMPLETED AT THE RETURNED INCOME. THE ORDER PASSED BY ASSESSING OFFICER WAS CONSIDERED TO BE ERRONEOUS AND LEARNED CIT SET ASIDE THE ORDER OF ASSESSING OFFICER BY PASSING AN ORDER U/S 263 AND IN VIEW OF THE ORDER PASSED U/S 263 THE ASSESSING OFFICER MADE THE ADDITION OF RS.1,49,25,000/- TO THE RETURNED INCOME ON ACCOUNT OF ALLEGED UNDECLARED LONG TERM CAPITAL GAIN. ITA NO.5 63(ASR)/2015 ASST. YE AR: 2007-08 3 4. AGGRIEVED WITH THE ORDER THE ASSESSEE FILED APP EAL BEFORE LEARNED CIT(A) AND LEARNED CIT(A) RELYING UPON THE ORDER OF HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF SHRI C.S. ATWAL & ORS. VS. CIT, 123 DTR 49 ALLOWED THE RELIEF TO THE ASSESSEE BY HOLDIN G AS UNDER: I HAVE CONSIDERED THE OBSERVATIONS OF THE ASSESSI NG OFFICER AS MADE BY HIM IN THE ORDER DATED 26.12.2014 WHICH IS UNDER CH ALLENGE. I HAVE ALSO CONSIDERED THE WRITTEN SUBMISSIONS FILED BY THE ASS ESSEE VIDE LETTER DATED 27.08.2015. I HAVE FURTHER CONSIDERED JUDICIA L PRONOUNCEMENTS RELIED UPON BY THE LD. AR OF THE ASSESSEE MORE SPEC IFICALLY THE ORDER OF THE HONORABLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF SHRI C. S. ATWAL & OTHERS VS CIT [ITA NO. 200 OF 20 13] DATED 22.07.2015 REPORTED ST (2015) 123 DTR (P&H) 49 AND OTHER MATERIAL BROUGHT ON RECORD. ON CAREFUL CONSIDERATIO N OF THE RIVAL CONTENTIONS, IT HAS BEEN NOTICED THAT THE SIMILAR A DDITION MADE UNDER IDENTICAL FACTS HAS BEEN DELETED BY THE HONOR ABLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF SHRI C. S. ATWAL & OTHERS VS CIT VIDE ITS ORDER IN ITA NO. 200 OF 20 :3 DATED 22 .07.2015 BY OBSERVING IN THE RELEVANT PARAS OF THE ORDER AS UND ER:- 46. WE SUMMARIZE OUR CONCLUSION, AS UNDER:- 1. PERUSAL OF TH JDA DATED 25.02.2007 READ WI TH SALE DEEDS DATED 02.03.007 AND 25.04.2007 IN RESPECT OF 3.08 ACRES A ND 4.62 ACRES RESPECTIVELY WO ! D REVEAL THAT THE PARTIES HAD AGREED FOR PRO-RATA T RANSFER OF LAND. 2. NO POSSESSION HAD BEEN GIVEN BY THE TRANSF EROR TO THE TRANSFEREE OF THE ENTIRE LAND IN PARI PERFORMANCE OF JDA DATED 25.2.2 007 SO A TO FALL WITHIN THE DOMAIN OF N.CTION 53A OF 1882 ACT. 3. THE POSSESSION DELIVERED, IF AT ALL. WAS AS A LICENCEE FOR THE DEVELOPMENT OF THE PROPERTY AND NOT IN THE CAPACITY OF A TRANSF EREE. ITA NO.5 63(ASR)/2015 ASST. YE AR: 2007-08 4 4. FURTHER SECTION 53A OF 882 ACT. BY INCORPORAT ION, STOOD EMBODIED IN SECTION 2(47)(V) OF THE ACT AND ALL THE ESSENTIAL I NGREDIENTS OF SECTION 53A OF 1882 ACT WERE REGISTERED TO BE FULFILLED. IN THE AB SENCE OF REGISTRATION OF JDA DATED 25.2.2007 HAVING BEEN EXECUTED AFTER 24.9.200 1, THE AGREEMENT DOES NOT FALL UNDER SECTION 53A OF 1882 ACT AND CONSEQUE NTLY SECTION 2(47)(V) OF THE ACT DOES NOT APPLY. 5. IT WAS SUBMITTED BY LEARNED COUNSEL FOR THE A SSESSEE-APPELLANT THAT WHATEVER AMOUNT WAS RECEIVED FROM THE DEVELOPER, CA PITAL GAINS TAX HAS ALREADY BEEN PAID ON THAT AND SALE DEEDS HAVE ALSO BEEN EXECUTED. IN VIEW OF CANCELLATION OF JDA DATED 25.2.2007, NO FURTHER AMO UNT HAS BEEN RECEIVED AND NO ACTION THEREON HAS BEEN TAKEN. IT WAS URGED THAT AS AND ANY AMOUNT IS RECEIVED, CAPITAL GAIN TAX SHALL BE DISCHARGED THER EON IN ACCORDANCE WITH LAW. IN VIEW OF THE AFORESAID STAND, WHILE DISPOSING OF THE APPEALS, WE OBSERVE THAT THE ASSESSEE APPELLANTS SHALL REMAINS BOUND BY THEI R SAID STAND. 6. THE ISSUE OF EXIGIBILITY TO CAPITAL GAINS TAX HAVING BEEN DECIDED IN FAVOUR OF THE ASSESSEE, THE QUESTION OF EXEMPTION UNDER SE CTION 54F OF THE ACT WOULD NOT SURVIVE ANY LONGER AND HAS BEEN RENDERED ACADEM IC. 7. THE TRIBUNAL AND AUTHORITIES BELOW WERE NOT R IGHT IN HOLDING THE ASSESSEE-APPELLANT TO BE LIABLE TO CAPITAL GAINS TA X IN RESPECT OF REMAINING LAND MEASURING 13.5 ACRES FOR WHICH NO CONSIDERATIO N HAD BEEN RECEIVED AND WHICH STOOD CANCELLED AND INCAPABLE OF PERFORMANCE AT PRESENT DUE TO VARIOUS ORDERS PASSED BY THE SUPREME COURT AND THE HIGH COU RT IN PILS. THEREFORE, THE APPEALS ARE ALLOWED. 47. CONSEQUENTIALLY, THE SUBSTANTIAL QUESTION OF LA W AS REPRODUCED IN THE BEGINNING OF THE JUDGMENT ARE AN SWERED IN THE MANNER INDICATED HEREINBEFORE AND THE APPEALS OF TH E ASSESSEE ARE DISPOSED OF ACCORDINGLY. 9.4 IN VIEW OF THE ABOVE STATED FACTS AND IN THE CI RCUMSTANCES OF THE CASE AND RESPECTFULLY FOLLOWING THE DECISION OF THE HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF SHRI C.S. ATWAL & ORS. VS. CIT IN ITA NO.200 OF 2013 DATED 22.07.2015 IN THE CASE OF WHIC H SIMILAR ADDITION UNDER IDENTICAL FACTS WAS MADE, I AM HAVING NO HESI TATION IN DELETING THE ADDITION OF RS.1,49,25,000/- MADE BY THE ASSESSING OFFICER IN THE CASE ITA NO.5 63(ASR)/2015 ASST. YE AR: 2007-08 5 OF THE ASSESSEE ON ACCOUNT OF ALLEGED UNDECLARED LT CG. THE ADDITION OF RS.1,49,25,000/- MADE BY THE ASSESSING OFFICER IS, THEREFORE, DIRECTED TO BE DELETED. IN THE RESULT, THE GROUNDS NO.6,7 AND 8 OF APPEAL TAKEN BY THE ASSESSEE ARE ALLOWED. 5. AGGRIEVED THE REVENUE IS IN APPEAL BEFORE US. 6. AT THE OUTSET, THE LEARNED DR SUBMITTED THAT THE DEPARTMENT HAS NOT ACCEPTED THE DECISION OF HONBLE PUNJAB & HARYA NA HIGH COURT IN THE CASE OF SH. C.S. ATWAL & ORS. VS. CIT (SUPRA) A S THE DEPARTMENT HAS FILED SLP IN THE SUPREME COURT. 7. THE LEARNED AR, HEAVILY RELIED UPON THE ORDER OF LEARNED CIT(A). 8. WE HAVE HEARD BOTH THE PARTIES AND HAVE GONE THR OUGH THE MATERIAL PLACED ON RECORD. WE FIND THAT LEARNED CIT (A) HAD ALLOWED RELIEF TO THE ASSESSEE AFTER RELYING UPON THE DECIS ION OF HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF SH. C. S. ATWAL & ORS. VS. CIT (SUPRA) AND THIS PRONOUNCEMENT BY HONBLE PUNJAB & HARYANA HIGH COURT IN ITA 200 OF 2013 WAS MADE ON 22.07.2015 WHE REIN THE HONBLE HIGH COURT HAD DECIDED THE ISSUE IN FAVOUR OF ASSES SEE UNDER SIMILAR FACTS AND CIRCUMSTANCES. THE LEARNED CIT(A) HAS REP RODUCED THE ORDER PASSED BY THE HONBLE COURT WHICH HAS ALSO BEEN MA DE PART OF THIS ORDER. THE GRIEVANCE OF THE REVENUE IS MISPLACED AS LEARNED DR WAS NOT ABLE TO BRING TO OUR NOTICE AS TO WHETHER HONBLE S UPREME COURT HAD STAYED THE ORDER OF PUNJAB & HARYANA HIGH COURT, TH EREFORE, ITA NO.5 63(ASR)/2015 ASST. YE AR: 2007-08 6 RESPECTFULLY FOLLOWING THE JUDGMENT OF HONBLE PUNJ AB AND HARYANA HIGH COURT IN THE CASE OF SH. C. S. ATWAL & ORS. V S. CIT (SUPRA), WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF LEARNED CIT( A) AND THEREFORE, THE APPEAL FILED BY REVENUE IS DISMISSED. 9. IN VIEW OF THE ABOVE, THE APPEAL FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 29 TH FEBRUARY, 2016. SD/- SD/- (A.D. JAIN) (T. S. KAPOOR) JUDICIAL MEMBER ACCOUNTANT MEMBE R DATED:29.02.2016. /PK/PS. COPY OF THE ORDER FORWARDED TO: (1) THE ASSESSEE: (2) THE (3) THE CIT(A), (4) THE CIT, (5) THE SR DR, I.T.A.T., TRUE COPY BY ORDER (ASSISTANT REGISTRAR) INCOME TAX APPELLATE TRIBUNAL, AMRITSAR BENCH: AMRITSAR.