ACIT, Circle-9(1), Hyderabad, Hyderabad V. L. Vijaylaxmi, Hyderabad, Hyderabad

ITA 576/HYD/2017

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 6455 (ITAT-HYDERABAD)
• Duration Of Justice: 1 year(s) 3 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-07-2018
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2007-2008
• Appeal Filed On: 30-03-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: M NARMADA
• Keywords: Gift
• Section: 54F; 148

Judgement Text

ITA NOS 576 AND 574 OF 2017 L VIJAYALAXMI HYDERABA D. PAGE 1 OF 4 IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD A BENCH, HYDERABAD BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI S.RIFAUR RAHMAN, ACCOUNTANT MEMBER ITA NO.576/HYD/2017 (ASSESSMENT YEAR: 2007-08) ASSTT. COMMISSIONER OF INCOME TAX, CIRCLE 9(1) HYDERABAD VS SMT. LATTUPALLY VIJAYALAXMI HYDERABAD PAN: ABHPL3633J (APPELLANT) (RESPONDENT) ITA NO.574/HYD/2017 (ASSESSMENT YEAR 2007-08) ASSTT. COMMISSIONER OF INCOME TAX, CIRCLE 9(1) HYDERABAD VS SHRI. L. VIJAYA KUMAR REDDY HYDERABAD PAN: AB DPL5104G (APPELLANT) (RESPONDENT) FOR REVENUE : SMT. M. NARMADA, DR FOR ASSESSEE : SHRI K.C. DEVDAS O R D E R PER SMT. P. MADHAVI DEVI, J.M. BOTH ARE REVENUES APPEALS FOR THE A.Y 2007-08 AGAINST THE ORDER OF THE CIT (A)-7, HYDERABAD DATED 16.09.2016. THE ASSESSEES HEREIN ARE BOTH HUSBAND AND WIFE AND THE ISSUE INVOLVED IS COMMON AND THEREFORE, THESE APPEALS WER E HEARD TOGETHER AND ARE DISPOSED OF BY THIS COMMON AND CON SOLIDATED DATE OF HEARING: 16. 07. 201 8 DATE OF PRONOUNCEMENT: 27.07.2018 ITA NOS 576 AND 574 OF 2017 L VIJAYALAXMI HYDERABA D. PAGE 2 OF 4 ORDER. THE GROUNDS RAISED BY THE REVENUE IN THE CA SE OF SHRI L. VIJAYA KUMAR REDDY ARE AS FOLLOWS: 1. THE LEARNED CIT (A) ERRED IN LAW AND ON FACTS OF THE CASE. 2. THE LEARNED CIT (A) ERRED IN ALLOWING DEDUCTION U/S 54F OF RS.1,39,16,267 TO THE ASSESSEE DESPITE THERE BEI NG NO CLAIM EITHER IN THE RETURN OF INCOME ORIGINALLY FIL ED OR THE ONE FILED IN RESPONSE TO NOTICE U/S 148. 3. THE LEARNED CIT (A) ERRED IN CONCLUDING THAT THE ASSESSEE DID NOT OWN MORE THAN ONE RESIDENTIAL HOUSE WITHOUT ASCERTAINING SUCH FACT FROM THE AO. 4. THE LEARNED CIT (A) OUGHT TO HAVE REMANDED THE M ATTER TO THE AO FOR PROPER ENQUIRIES ON THE ISSUE OF ELIGIBI LITY OF DEDUCTION U/S 54F . 2. BRIEF FACTS OF THE CASE ARE THAT BOTH THE ASSESS EES ARE HUSBAND AND WIFE AND OWNED A PROPERTY ALONG WITH OT HERS WHICH WAS GIVEN FOR DEVELOPMENT TO M/S. CHOICE INFRASTRUC TURE PROJECTS (P) LTD ON 7.7.2006 ON 50:50 BASIS. AS PER THE AGRE EMENT, THE ASSESSEE HAD TO FOREGO 50% OF HIS LAND AND IN CONSI DERATION THEREOF, HE WOULD GET CONSTRUCTED AREA IN THE FORM OF THREE FLATS. ON BEHALF OF THE LAND OWNER, ONE OF THE LAND OWNER HAD RECEIVED AN AMOUNT OF RS.84.00 LAKHS TOWARDS REFUNDABLE ADVA NCE. THE ASSESSEE MR. L.V.K. REDDY WAS TO RECEIVE THREE FLAT S WHICH HE HAD GIFTED TO HIS WIFE SMT. L. VIJAYALAXMI ON 29.08.200 8. THE ASSESSEE MR. L.VIJAY KUMAR REDDY CONTENDED THAT HE HAS NOT R ECEIVED ANY SALE CONSIDERATION AND HENCE CAPITAL GAINS CANNOT B E BROUGHT TO TAX IN HIS HANDS. SIMILARLY, THE ASSESSEE, SMT. VIJ AYALAKSHMI, ALSO RECEIVED FLATS TOWARDS HER SHARE OF LAND. THE AO HO WEVER, HELD THAT BOTH THE ASSESSEES HAVE RECEIVED THE FLATS AND ACCORDINGLY COMPUTED THE CAPITAL GAINS AT RS.1,39,16,267. AGGRI EVED, THE ITA NOS 576 AND 574 OF 2017 L VIJAYALAXMI HYDERABA D. PAGE 3 OF 4 ASSESSEES PREFERRED APPEALS BEFORE THE CIT (A), ALS O MAKING AN ALTERNATIVE CLAIM THAT THE ASSESSEE IS ENTITLED TO EXEMPTION U/S 54F OF THE ACT. THE CIT (A), AFTER REPRODUCING THE ASSESSEES CONTENTIONS AT LENGTH, ACCEPTED THE ASSESSEES CONT ENTION AND ALLOWED THE DEDUCTION U/S 54F OF THE ACT. 3. THE LEARNED DR SUBMITTED THAT THE ASSESSEE HAD N OT CLAIMED EXEMPTION U/S 54F IN THE RETURN OF INCOME O RIGINALLY FILED OR IN THE RETURN FILED IN RESPONSE TO NOTICE U/S 14 8 AND THE CIT (A), WITHOUT EVEN VERIFYING WHETHER THE ASSESSEE FU LFILLS THE OTHER CONDITIONS OF SECTION 54F OF THE ACT, HAS ALLOWED T HE EXEMPTION U/S 54F OF THE ACT. 4. THE LEARNED COUNSEL FOR THE ASSESSEE, ON THE OTH ER HAND, SUPPORTED THE ORDERS OF THE CIT (A). 5. HAVING REGARD TO THE RIVAL CONTENTIONS AND THE M ATERIAL ON RECORD, WE FIND THAT THE CIT (A) WAS SATISFIED T HAT THE ASSESSEES ARE ELIGIBLE FOR DEDUCTION U/S 54F OF THE ACT ON TH E CAPITAL GAIN THAT HAS ARISEN BY VIRTUE OF THE DEVELOPMENT AGREEM ENT. HOWEVER, HE HAS NOT GIVEN ANY FINDING AS TO WHETHER THE ASSE SSEES HAVE FULFILLED THE OTHER CONDITIONS OF SECTION 54F OF TH E ACT. IN VIEW OF THE SAME, WE DEEM IT FIT AND PROPER TO REMAND THE I SSUE TO THE FILE OF THE AO WITH A DIRECTION TO VERIFY THE CLAIM OF D EDUCTION U/S 54F IN THE HANDS OF EACH OF THE ASSESSEES BEFORE US AN D IF IT IS FOUND THAT THE ASSESSEE FULFILLS THE OTHER CONDITIONS U/S 54F, BOTH SHALL ITA NOS 576 AND 574 OF 2017 L VIJAYALAXMI HYDERABA D. PAGE 4 OF 4 BE GRANTED DEDUCTION U/S 54F OF THE ACT. REVENUES APPEALS ARE THEREFORE, TREATED AS ALLOWED FOR STATISTICAL PURPO SES. 6. IN THE RESULT, REVENUES APPEALS ARE TREATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 27 TH JULY, 2018. SD/- SD/- (S.RIFAUR RAHMAN) ACCOUNTANT MEMBER (P. MADHAVI DEVI) JUDICIAL MEMBER HYDERABAD, DATED 27 TH JULY 2018. VINODAN/SPS COPY TO: 1 ASSTT. COMMISSIONER OF INCOME TAX, CIRCLE 9(1) RO OM NO.245, BLOCK D, SECOND FLOOR, IT TOWERS, AC GUARDS, MASAB TANK, HYDERABAD 2 SMT. LATTUPALLY VIJAYALAXMI, H.NO.17-1-383/11-33- 33/1 VINAYA NAGAR COLONY, SAIDABAD, HYDERABAD 3 CIT (A) - 7 HYDERABAD 4 PR. CIT 7, HYDERABAD 5 THE DR, ITAT HYDERABAD 6 GUARD FILE BY ORDER