THE ITO, Rajahmundry V. Bonagiri Satyathi,

ITA 580/VIZ/2014

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 1145 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 1 year(s) 6 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-05-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2007-2008
• Appeal Filed On: 29-10-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D KOMALI KRISHNADR
• Keywords: Additional evidence
• Section: 54B

Judgement Text

ITA NO.579 TO 581/VIZAG/2014 B. SURYA RATHNA NARASIMHA MURTHY AND OTHERS 1 , , IN THE INCOME TAX APPELLATE TRIBUNAL, VISAKHAPATNAM BENCH, VISAKHAPATNAM . , . , $ BEFORE SHRI V. DURGA RAO, JUDICIAL MEMBER & SHRI G. MANJUNATHA, ACCOUNTANT MEMBER ./I.T.A.NO.579/VIZAG/2014 ( / ASSESSMENT YEAR: 2007-08) ITO, WARD - 3, RAJAHMUNDRY VS. B. SURYA RATHNA NARASIMHA MURTHY, PALACHARLA VILLAGE, E.G. DIST. [PAN: AMZPB9391A ] ( % / APPELLANT) ( &'% / RESPONDENT) ./I.T.A.NO.580/VIZAG/2014 ( / ASSESSMENT YEAR: 2007-08) ITO, WARD - 3, RAJAHMUNDRY VS. SHRI BONAGIRI SATYAVATHI, PALACHARLA VILLAGE, E.G. DIST. [PAN: ARSPB0758M ] ( % / APPELLANT) ( &'% / RESPONDENT) ./I.T.A.NO.581/VIZAG/2014 ( / ASSESSMENT YEAR: 2007-08) ITO, WARD - 3, RAJAHMUNDRY VS. SHRI B. VEERA VENKATA RAJU, PALACHARLA VILLAGE, E.G. DIST. [PAN: APHPB5967K ] ( % / APPELLANT) ( &'% / RESPONDENT) / APPELLANT BY : SMT. D. KOMALI KRISHNA,DR / RESPONDENT BY : SHRI G.V.N. HARI, AR ITA NO.579 TO 581/VIZAG/2014 B. SURYA RATHNA NARASIMHA MURTHY AND OTHERS 2 / DATE OF HEARING : 06.05.2016 / DATE OF PRONOUNCEMENT : 27.05.2016 / O R D E R PER V. DURGA RAO, JUDICIAL MEMBER: THESE APPEALS FILED BY THE REVENUE ARE AGAINST THE COMMON ORDER OF CIT(A), VISAKHAPATNAM DATED 25.8.2014 FOR THE AS SESSMENT YEAR 2007-08. SINCE THE FACTS ARE IDENTICAL, THEY ARE C LUBBED, HEARD TOGETHER AND DISPOSED OFF, BY WAY OF THIS COMMON ORDER FOR T HE SAKE OF CONVENIENCE. 2. FACTS ARE IN BRIEF THAT THE ASSESSEE HAS SOLD TH E LAND ALONG WITH THE OTHER FAMILY MEMBERS. ACCORDING TO THE ASSESSE E, THE LAND SOLD WAS SITUATED BEYOND 8 KMS. FROM THE MUNICIPAL LIMITS OF RAJAHMUNDRY AND NO CAPITAL GAIN ARISES OUT OF TRANSFER OF THE LAND. HOWEVER, THE A.O. OF THE OPINION THAT THE LAND SOLD BY THE ASSESSEE WITH OTHERS IS WITHIN THE MUNICIPAL LIMITS OF RAJAHMUNDRY AND THE GAINS RECEI VED BY THE ASSESSEE ARE ASSESSABLE UNDER THE HEAD LONG TERM CAPITAL GA INS AND ASSESSMENT WAS COMPLETED. THE ASSESSEE CARRIED MATTER IN APPE AL BEFORE THE CIT(A). THE LD. CIT(A) HAS CONFIRMED THE ORDER OF THE A.O. THE ASSESSEE FURTHER CARRIED THE MATTER IN APPEAL BEFOR E THE ITAT, ITA NO.579 TO 581/VIZAG/2014 B. SURYA RATHNA NARASIMHA MURTHY AND OTHERS 3 VISAKHAPATNAM. MEANWHILE, THE A.O. HAS INITIATED T HE PENALTY PROCEEDINGS U/S 271(1)(C) OF THE INCOME TAX ACT, 19 61 (HEREINAFTER CALLED AS 'THE ACT'). BEFORE THE A.O., THE ASSESSE E HAS SUBMITTED THAT THE ASSESSEE NEITHER CONCEALED THE INCOME NOR FILED INACCURATE PARTICULARS. HE ONLY MADE A CLAIM THAT THE LAND SI TUATED BEYOND THE 8 KMS. OF MUNICIPAL LIMITS AND PRAYED THAT PENALTY PR OCEEDINGS MAY BE DROPPED. HOWEVER, THE LD. A.O. IS NOT SATISFIED WI TH THE EXPLANATION GIVEN BY THE ASSESSEE AND IMPOSED A PENALTY U/S 271 (1)(C) OF THE ACT BY OBSERVING THAT THE ASSESSEE HAS NOT FILED THE RETUR N OF INCOME AND ONLY BECAUSE OF SURVEY IN THE CASE OF M/S. GODAVARI TOWN SHIPS PVT. LTD., IT CAME TO THE NOTICE OF THE DEPARTMENT. THEREAFTER, THE ASSESSEE HAS MADE A CLAIM THAT THE LAND IS AN AGRICULTURAL LAND. WITH THE ABOVE OBSERVATIONS, THE LD. A.O. LEVIED THE PENALTY U/S 2 71(1)(C) OF THE ACT. 3. ON BEING AGGRIEVED, ASSESSEE CARRIED MATTER IN A PPEAL BEFORE THE CIT(A). IT WAS SUBMITTED BEFORE THE LD. CIT(A) THA T THE CLAIM MADE BY THE ASSESSEE WAS BASED ON A CERTIFICATE ISSUED BY T HE A.E., R&B, RAJAHMUNDRY AND THE ASSESSEE HAS NEITHER CONCEALED THE INCOME NOR FILED INACCURATE PARTICULARS AND THEREFORE, NO PENA LTY CAN BE LEVIED. THE LD. CIT(A) AFTER CONSIDERING THE EXPLANATIONS OF TH E ASSESSEE, HE HAS DELETED THE PENALTY LEVIED BY THE A.O. BY OBSERVING AS UNDER: ITA NO.579 TO 581/VIZAG/2014 B. SURYA RATHNA NARASIMHA MURTHY AND OTHERS 4 6. I HAVE CONSIDERED THE SUBMISSIONS AND DETAILS FIL ED. AT THE OUTSET THE INFORMATION IN THE FORM OF CERTIFICATE FROM ASS ISTANT ENGINEER (R&B) AND DETAILS RELATING TO PURCHASE OF LAND FOR THE PU RPOSE OF SECTION 54B CANNOT BE CONSIDERED AS ADDITIONAL EVIDENCE AS THES E INFORMATION WAS ALREADY FILED BEFORE THE ASSESSING OFFICER. FURTHER IT IS NOTED THAT THESE ISSUES ARE ALREADY AGITATED BEFORE THE CIT(A) IN TH E QUANTUM APPEAL AND THE LEARNED CIT(A) IN HIS ORDER DTD.25.01.2012 HAS ADJUDICATED THESE ISSUES AND GIVEN HIS FINDINGS. THEREFORE THE ONLY ISSUE TO BE RESOLVED IS WHETHER THE ASSESSEE CAN BE SAID TO HAV E CONCEALED PARTICULARS OF HIS INCOME FOR THE PURPOSE OF SECTIO N 271(1)(C). IT IS TO BE NOTED THAT IN THE RETURN OF INCOME FILED IN RESP ONSE TO NOTICE U/S.142(1), THE ASSESSEE HAS DISCLOSED THE IMPUGNED TRANSACTION, BUT, HOWEVER CLAIMED THE CAPITAL GAINS TO BE EXEMPT ON T HE GROUND THAT THE SUBJECT LAND IS SITUATED MORE THAN 8 KM FROM MUNICI PAL LIMITS. IT IS ALSO NOTED THAT THE CLAIM REGARDING DISTANCE WAS ON THE BASIS OF A CERTIFICATE ISSUED BY THE ASSISTANT ENGINEER (R&B). I FIND APPA RENTLY THERE IS NO BASIS TO TAKE A VIEW THAT THE ASSESSEE HAS CONCEALE D PARTICULARS OF HIS INCOME, AS THE PARTICULARS RELATING TO THE IMPUGNED TRANSACTION HAVE BEEN DISCLOSED IN THE RETURN FILED AND ACCORDINGLY THE A SSESSING OFFICER'S VIEW THAT THE ASSESSEE HAS CONCEALED INCOME IS NOT JUSTI FIED. IT MAY ALSO BE RELEVANT TO SEE WHETHER THE ASSESSEE CAN BE SAID TO HAVE FURNISHED INACCURATE PARTICULARS OF INCOME. IN THIS REGARD IT HAS TO BE SEEN THAT THE ASSESSEE HAS TAKEN THE DISTANCE AT 9 KM BASED ON CERTIFICATE ISSUED BY ASSISTANT ENGINEER (R&B). THE ASSESSING OFFICER HAS TAKEN THE DISTANCE TO 7.7 KM BASED ON THE INSPE CTOR'S INQUIRY REPORT. THOUGH THE VIEW TAKEN BY THE ASSESSING OFFI CER HAS BEEN UPHELD BY THE CIT(A), IT CANNOT BE SAID THAT THE CL AIM MADE BY THE ASSESSEE WAS NOT BONA FIDE, AS THE ASSESSEE HAS MAD E THE CLAIM BASED ON A CERTIFICATE ISSUED BY A GOVERNMENT AGENC Y. IN THESE FACTUAL CIRCUMSTANCES, THE ASSESSEE CANNOT BE SAID TO HAVE FURNISHED INACCURATE PARTICULARS OF INCOME. TAKING INTO ACCOUNT THE OVERALL FACTS AND CIRCUMSTANCES OF THE CASE, I AM OF THE VIEW THAT THE ASSESSING OFFICER IS NOT JUSTIFIED IN LEVY ING THE IMPUGNED PENALTY U/S.271(1)(C) OF THE ACT. ACCORDINGLY THE A SSESSING OFFICER IS DIRECTED TO CANCEL THE IMPUGNED PENALTY U/S 271( 1)(C). 4. ON BEING AGGRIEVED, REVENUE CARRIED MATTER IN AP PEAL BEFORE THE TRIBUNAL. THE LD. D.R. SUPPORTED THE ORDER PASSED BY THE A.O. 5. ON THE OTHER HAND, THE LD. COUNSEL FOR THE ASSES SEE HAS SUBMITTED THAT WHETHER THE LAND WHICH IS IN DISPUTE IS SITUAT ED WITHIN 8 KMS. OR BEYOND 8 KMS. WAS ALREADY CONSIDERED BY THE TRIBUNA L IN THE ASSESSEES ITA NO.579 TO 581/VIZAG/2014 B. SURYA RATHNA NARASIMHA MURTHY AND OTHERS 5 OWN CASE FOR THE VERY SAME ASSESSMENT YEAR IN ITA N OS.280, 281 & 284/VIZAG/2012 DATED 2.3.2016 AND HELD THAT THE LAN D IS SITUATED BEYOND 8 KMS. OF RAJAHMUNDRY MUNICIPAL LIMITS AND S UBMITTED THAT THE ASSESSEE NEITHER CONCEALED THE INCOME NOR FILED INA CCURATE PARTICULARS AND FURTHER SUBMITTED THAT THE ORDER PASSED BY THE CIT(A) MAY BE UPHELD AND THE APPEAL FILED BY THE REVENUE MAY BE D ISMISSED. 6. WE HAVE HEARD BOTH THE PARTIES, PERUSED THE MATER IALS AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHOR ITIES BELOW. IN THIS CASE, THE ASSESSEE ALONG WITH OTHER FAMILY MEMBERS SOLD THE AGRICULTURAL LAND AND NO RETURN WAS FILED. SUBSEQUENTLY, THERE IS A SURVEY CONDUCTED IN THE CASE OF M/S. GODAVARI TOWNSHIPS PVT. LTD., R AJAHMUNDRY TO WHOM THE ASSESSEE SOLD THE LANDS. BASED ON THE SURVEY, A NOTICE WAS ISSUED TO THE ASSESSEE AND ASSESSEE FILED A RETURN OF INCO ME, WHEREIN HE HAS SUBMITTED THAT THE LAND SOLD BY THE ASSESSEE IS NOT A CAPITAL GAIN AND IT IS AN AGRICULTURAL LAND AND NO INCOME WAS OFFERED F OR TAXATION ON THE GROUND THAT IT IS BEYOND 8 KMS. OF THE RAJAHMUNDRY MUNICIPAL LIMITS. ACCORDING TO THE A.O., IT IS WITHIN THE 8 KMS. OF R AJAHMUNDRY MUNICIPALITY AND A.O. HAS CONCLUDED THAT ASSESSEE I S ASSESSABLE UNDER THE HEAD LONG TERM CAPITAL GAINS. ACCORDINGLY, A SSESSMENT WAS COMPLETED. ON APPEAL, CIT(A) CONFIRMED THE SAME. WHEN MATTER ITA NO.579 TO 581/VIZAG/2014 B. SURYA RATHNA NARASIMHA MURTHY AND OTHERS 6 CARRIED TO THE ITAT, VISAKHAPATNAM BENCH, THE TRIBU NAL HAS CONSIDERED ALL THE DETAILS IN ITA NOS.279 TO 281, 283 & 284/VI ZAG/2012 DATED 2.3.2016 HAS HELD THAT THE LAND SOLD BY THE ASSESSE E IS BEYOND 8 KMS. OF THE RAJAHMUNDRY MUNICIPAL LIMITS. IN VIEW OF THE A BOVE, WE FIND THAT THE ASSESSEE NEITHER CONCEALED THE INCOME NOR FILED INACCURATE PARTICULARS. IT HAS ONLY MADE CLAIM BEFORE THE A.O . THAT THE LAND SOLD BY THE ASSESSEE IS AN AGRICULTURAL LAND. THE CLAIM MA DE BY THE ASSESSEE IS ACCEPTED BY THE TRIBUNAL. IN VIEW OF THE ABOVE, BY TAKING INTO FACTS AND CIRCUMSTANCES OF THE CASE, WE ARE OF THE OPINION TH AT IT IS NOT A FIT CASE TO IMPOSE PENALTY U/S 271(1)(C) OF THE ACT. THUS, WE FIND NO REASON TO INTERFERE WITH THE ORDER PASSED BY THE CIT(A) AND A PPEALS FILED BY THE REVENUE ARE DISMISSED. 7. IN THE RESULT, THE APPEALS FILED BY THE REVENUE ARE DISMISSED . THE ABOVE ORDER WAS PRONOUNCED IN THE OPEN COURT ON 27 TH MAY16. SD/- SD/- ( . ) ( . ) (G. MANJUNATHA) (V. DURGA RAO) /ACCOUNTANT MEMBER /JUDICIAL MEMBER ! /VISAKHAPATNAM: % /DATED : 27.05.2016 VG/SPS ITA NO.579 TO 581/VIZAG/2014 B. SURYA RATHNA NARASIMHA MURTHY AND OTHERS 7 '! (! /COPY OF THE ORDER FORWARDED TO:- 1. / THE APPELLANT THE ITO, WARD-3, RAJAHMUNDRY, E. G. DIST. 2. / THE RESPONDENT SHRI BONAGIRI SURYA RATNA NARAS IMHA MURTHY, S/O RAMA KRISHNA RAO, D.NO.2-114, PALACHERLA VILLAGE, R AJANAGARAM MANDAL, E.G. DIST. 3. / THE RESPONDENT SHRI BONAGIRI SATYAVATHI, W/O S RI SURYA RATNA NARASIMHA MURTHY, D.NO.2-114, PALACHERLA VILLAGE, R AJANAGARAM MANDAL, E.G. DIST. 4. / THE RESPONDENT SHRI BONAGIRI VEERA VENKATA RAJ U, S/O RAMA KRISHNA RAO, 2-5A, PALACHERLA VILLAGE, RAJANAGARAM MANDAL, E.G. DISTRICT. 5. ) / THE CIT, VISAKHAPATNAM 6. ) ( ) / THE CIT(A), VISAKHAPATNAM 7. ! , , , , ! / DR, ITAT, VISAKHAPATNAM 8 . / GUARD FILE / BY ORDER // TRUE COPY // /0 , (SR.PRIVATE SECRETARY) , , ! / ITAT, VISAKHAPATNAM