The Income Tax Officer, Muktsar V. Sh. Harinderpal Singh, Muktsar

ITA 617/ASR/2015

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 7736 (ITAT-AMRITSAR)
• Duration Of Justice: 1 year(s) 11 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-10-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 29-06-2017
• Assessment Year: 2007-2008
• Appeal Filed On: 30-11-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAHUL DHAWANLD
• Assessee Lawyers: ASHWANI KUMAR LD
• Keywords: Capital asset; Question of law; Revised return; Reassessment proceedings
• Section: 143(3); 54F; 260A; 139(5); 147; 27; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIB UNAL AMRITSAR BENCH; AMRITSAR BEFORE SH.T.S. KAPOOR, ACCOUNTANT MEMBER AND SH.N.K.CHOUDHRY, JUDICIAL MEMBER I.T.A. NO.617(ASR)/2015 ASSESSMENT YEAR:2007-08 INCOME TAX OFFICER, WARD-II(2), MUKTSAR. VS. BHAI HARNIRPAL SINGH C/O BHAI NARINDER SINGH SUDARSHAN KUMAR, NEW GRAIN MARKET, MUKTSAR. PAN:ARHPS-4295F (APPELLANT) (RESPONDENT) APPELLANT BY: SH. RAHUL DHAWAN (LD. DR) RESPONDENT BY: SH. ASHWANI KUMAR (LD. CA.) DATE OF HEARING:17.08.2017 DATE OF PRONOU NCEMENT:31.10.2017 ORDER PER N. K. CHOUDHRY : THE INSTANT APPEAL HAS BEEN PREFERRED BY THE REVENUE DEPARTMENT, ON FEELING AGGRIEVED AGAINST THE ORDER D ATED 18.09.2015 PASSED IN APPEAL NO.20-IT/CIT(A)/BTI/2014-15 BY THE L D. CIT(A), BATHINDA FOR ASST. YEAR 2007-08. 2. THE REVENUE DEPARTMENT HAS RAISED THE FOLLOWING GRO UNDS OF APPEAL. 1. THE LD. CIT(A) HAS ERRED IN DELETING PENALTY I MPOSED U/S 217(1)(C) IN CASE, IGNORING THE FACT THAT THE ASSES SEE FAILED TO DISCLOSED THE AMOUNT OF SALE CONSIDERATION RECEIVED BY HIM DURING THE YEAR ON ACTUAL TRANSFER OF PROPORTIONATE SHARE OF LAND TO THE DEVELOPER. 2. THE LD. CIT(A) HAS ERRED IN FAILING TO TAKE INTO ACCOUNT THAT PENALTY U/S 271(L)(C) HAS BEEN HELD TO BE A CI VIL LIABILITY BY THE HON'BLE SUPREME COURT IN UNION OF INDIA VS. DHARMENDRA TEXTILE PROCESSORS AND ORS (166 TAXMAN 6 5) AND I TA NO. 617(ASR)/2015 ASST. YEAR: 2007-08 2 THIS BEING THE CASE, THE AO HAS DISCHARGE THE BURDE N ON HIM OF ESTABLISHING NECESSARY INGREDIENTS OF SECTION 27 1(1)(C) AND HAS CORRECTLY LEVIED PENALTY. 3. THE CIT (A) HAS ERRED IN FAILING TO CONSIDER THA T THE ADDITION MADE BY THE A.O. ON THE ISSUE STANDS CONFI RMED UP TO ITAT AND ALSO BY HON'BLE HIGH COURT TO THE EXTEN T OF PROPORTIONATE SALE CONSIDERATION ACCRUING TO THE AS SESSEE ON ACTUAL TRANSFER OF LAND DURING THE YEAR. 4. THE CIT (A) HAS ERRED ON FAILING TO CONSIDER TH AT THE PUNJAB AND HARYANA HIGH COURT WHILE DECIDING THE CASE OF C.S. ATWAL VS. CIT, LUDHIANA & ANOTHER'S WITH WHICH ASSESSEE'S CASE WAS LINKED HAS NOTED THE ADMISSION MADE ON BEHALF OF THE ASSESSEES THAT CAPITAL GAIN WAS EXIGIBLE ON PROPORTIONATE SALE CONSIDERATION AND AL SO RECORDED THEIR UNDERTAKING TO PAY BALANCE CAPITAL GAIN TAX AND IN THE LIGHT OF SUCH ADMISSION IT WAS A CLEAR CASE OF CONCEALMENT OF INC OME AND PENALTY HAD BEEN RIGHTLY IMPOSED. 5. THE CIT(A) HAS ERRED IN HOLDING THAT THE ISSUE INVOLVED WAS DEBATABLE AND SUBJECTED TO LITIGATION WITH VARI ED RESULTS AND, THEREFORE, NO PENALTY COULD BE LEVIED AND IN S O HOLDING FAILED TO APPRECIATE THAT EVERY ISSUE IS DEBATABLE AND MERELY BECAUSE ASSESSEE CHOOSE TO LITIGATE AND LITIGATION HAS VARIED RESULTS WOULD NOT DETRACT FORM PENAL PROVISIONS OF THE STATUTE PROVIDED THE NECESSARY INGREDIENTS FOR INVOKING SUC H PROVISION WERE ESTABLISHED AS THESE WERE IN THE INS TANT CASE . 3. THE BRIEF FACTS OF THE CASE ARE AS UNDER: THAT THE ASSESSEE WAS BEING A MEMBER OF THE PUNJABI CO- OPERATIVE HOUSE BUILDING SOCIETY (IN SHORT SOCIETY) WAS ASSESSED U/S 147/143(3) ON 24.12.2010 FOR A.Y.2007-08, WHEREBY HITHERTO UNDECLARED LONG TERM CAPITAL GAINS O F RS.1,63,25,982/-, PURSUANT TO THE TRANSFER OF LAND WAS ASSESSED TO TAX. SUBSEQUENTLY, INVOKING THE PROVISIONS OF EXPLA NATION 1(A) APPENDED TO SECTION 271(1)(C) OF THE INCOME TAX ACT, 196 1. THE PENALTY OF RS.36,63,550/- VIDE ORDER DATED 24.03 .2014, WHICH IS EQUIVALENT TO 100% OF THE AMOUNT OF TAX SOUGH T TO BE EVADED BY REASON OF THE PURPORTED CONCEALMENT OF THE PARTICULARS OF INCOME ARISING ON ACCOUNT OF LONG TERM CAP ITAL GAINS. I TA NO. 617(ASR)/2015 ASST. YEAR: 2007-08 3 4. ON FEELING AGGRIEVED AGAINST THE PENALTY ORDER , THE ASSESSEE PREFERRED THE FIRST APPEAL BEFORE THE LD. CIT(A), WH O WHILE RELYING UPON THE ORDER PASSED BY THE JURISDICTIONAL HIGH COURT DELETED THE PENALTY BY HOLDING AS UNDER: 22. AFTER A DETAILED DELIBERATION ON THE AFORESAID ISSU ES, THE HONBLE HIGH COURT SUMMARIZED THEIR CONCLUSION IN PARA 46 O F THEIR ORDER DATED 22 ND OF JULY, 2015. IT WOULD NOT BE INAPPROPRIATE TO LO OK AT THE SAID CONCLUSION IN ORDER TO ADJUDICATE THE ISSUE OF IMPO SITION OF PENALTY. WE SUMMARIZE OUR CONCLUSIONS AS UNDER:- 1. PERUSAL OF THE JDA DATED 25.02.2007 READ WITH SA LE DEEDS J DATED 02.03.2007 AND 25.04.2007 IN RESPECT OF 3.08 ACRES AND 4.62 ACRES RESPECTIVELY WOULD REVEAL THAT THE PARTI ES HAD AGREED FOR PRO-RATA TRANSFER OF LAND. 2. NO POSSESSION HAD BEEN GIVEN BY THE TRANSFEROR T O THE TRANSFEREE OF THE ENTIRE LAND IN PART PERFORMANCE O F JDA DATED 25.02.2007 SO AS TO FALL WITHIN THE DOMAIN OF SECTI ON 53-A OF 1882 ACT. 3. THE POSSESSION DELIVERED, IF AT ALL, WAS A LICEN SEE FOR THE DEVELOPMENT OF THE PROPERTY AND NOT IN THE CAPACITY OF A TRANSFEREE. 4. FURTHER SECTION 53-A OF 1882 ACT, BY INCORPORATI ON, STOOD EMBODIED IN SECTION 2(47)(V) OF THE ACT AND ALL THE ESSENTIAL INGREDIENTS OF SECTION 53-A OF 1882 ACT WERE REQUIR ED TO BE FULFILLED. IN THE ABSENCE OF REGISTRATION OF JDA DATED 25.02.2 007 HAVING BEEN EXECUTED AFTER 24.09.2001, THE AGREEMENT DOES NOT F ALL UNDER SECTION 53-A OF 1882 ACT AND CONSEQUENTLY SECTION 2 (47)(V) OF THE ACT DOES NOT APPLY. 5. IT WAS SUBMITTED BY LEARNED COUNSEL FOR THE ASSE SSEE- APPELLANT THAT WHATEVER AMOUNT WAS RECEIVED FROM TH E DEVELOPER, CAPITAL GAINS TAX HAS ALREADY BEEN PAID ON THAT AND SALE DEEDS HAVE ALSO BEEN EXECUTED. IN VIEW OF CANCELLATION OF JDA DATED 25.02.207, NO FURTHER AMOUNT HAS BEEN RECEIVED AND NO ACTION THEREON HAVE BEEN TAKEN. IT WAS URGED THAT AS AND WHEN ANY AMOUNT IS RECEIVED, CAPITAL GAINS TAX SHALL BE DISC HARGED THEREON IN ACCORDANCE WITH LAW. IN VIEW OF THE AFORESAID STAND , WHILE DISPOSING OF THE APPEALS, WE OBSERVE THAT THE ASSES SEE APPELLANT SHALL REMAIN BOUND BY THE SAID STAND. 6. THE ISSUE OF EXIGIBILITY TO CAPITAL GAINS TAX HA VING BEEN DECIDED IN FAVOUR OF THE ASSESSEE, THE QUESTION OF EXEMPTION UNDER I TA NO. 617(ASR)/2015 ASST. YEAR: 2007-08 4 SECTION 54F OF THE ACT WOULD NOT SURVIVE ANY LONGER AND HAS BEEN RENDERED ACADEMIC. 7. THE TRIBUNAL AND THE AUTHORITIES BELOW WERE NOT RIGHT IN HOLDING THE ASSESSEE- APPELLANT TO BE LIABLE TO CAP ITAL GAINS TAX IN RESPECT OF REMAINING LAND MEASURING 13.5 ACRES FOR WHICH NO CONSIDERATION HAD BEEN RECEIVED AND WHICH STOOD CAN CELLED AND INCAPABLE OF PERFORMANCE AT PRESENT DUE TO VARIOUS ORDERS PASSED BY THE SUPREME CURT AND THE HIGH COURT IN PILS. THE REFORE, THE APPEALS AREA ALLOWED. 23. THE AFORESAID JUDGMENT/DECISION OF THE HONBL E PUNJAB AND HARYANA HIGH COURT MAKES IT QUITE CLEAR THAT THE AP PELLANT WAS NOT OBLIGED TO PAY TAX ON THE AMOUNT/CONSIDERATION WHIC H HAD NOT BEEN RECEIVED BY THE APPELLANT DURING THE YEAR UNDER CON SIDERATION. THIS WAS THE STAND OF THE APPELLANT IN NOT DISCLOSING THE AC CRUAL OF CAPITAL GAINS IN HIS RETURN OF INCOME. HOWEVER SINCE THE HONBLE HIG H COURT HAS HELD THAT THE APPELLANT HAD AGREED FOR PRO-RATA TRANSFER OF L AND, CAPITAL GAINS TAX HAS TO BE PAID ON WHATEVER AMOUNT HAS BEEN RECEIVED AND THAT WHENEVER FURTHER AMOUNTS ARE RECEIVED, IT SHALL BE TAXABLE. THE ASSESSING OFFICER SHALL LOOK INTO THIS ASPECT OF THE INSTANT CASE. TH E APPELLANT IS REQUIRED TO PAY TAX ON THE AMOUNT OF CONSIDERATION RECEIVED AND DO THE SAME WHENEVER ANY FURTHER AMOUNT IS RECEIVED IN RESPECT OF TRANSFER OF HIS PART OF LAND IN THE SOCIETY AS PER THE DECISION OF THE H ONBLE HIGH COURT. 24. ADVERTING NOW TO THE ISSUE OF EXIGIBILITY OF P ENALTY AFTER THE ISSUE IN DISPUTE STANDS DECIDED BY THE HONBLE HIGH COURT OF PUNJAB AND HARYANA, IT NEEDS NO ELABORATION TO SAY THAT THE MA TTER WAS CLEARLY DEBATABLE IN AS MUCH AS THE DECISION OF THE HONBLE TRIBUNAL WAS OVERTURNED BY THE JUDGMENT OF THE HONBLE HIGH COUR T. THE APPELLANT CANNOT, THEREFORE, BE SAID TO HAVE GIVEN OR OFFERED AN EXPLANATION FOR NOT INCLUDING THE PURPORTED CAPITAL GAINS IN HIS RETURN OF INCOME AS FALSE OR INDICATING OF AN ACT OF FRAUD, OR GROSS OR WILLFUL NEGLIGENCE. THE APPELLANT, DURING THE REASSESSMENT PROCEEDINGS, HAD RAISED A L EGAL CONTENTION RAISING A BONAFIDE CLAIM THAT THE AMOUNT OF CONSIDE RATION RECEIVED BY THE DEVELOPER WAS ONLY AN ADVANCE AND NOT TAXABLE TILL THE ENTIRE CONSIDERATION WAS RECEIVED. MERELY BECAUSE SUCH A C LAIM OF THE APPELLANT WAS REJECTED SUCCESSIVELY BY THE ASSESSING OFFICER, THE THEN ID. CIT (A) AND THE HONBLE ITAT, THE APPELLANTS EXPLANATION C ANNOT BE SAID TO BE FANCIFUL, BASELESS OR UNACCEPTABLE, BRANDING THE SA ME AS AN ACT OF CONCEALMENT. CONCEALMENT OF INCOME FOR WHICH PENALT Y UNDER THE PROVISIONS OF SECTION 271(1)(C) OF THE ACT IS LEVIE D, CANNOT BE INFERRED FROM THE ACT OF THE APPELLANT ONLY BECAUSE THE ASSESSING OFFICER, ON A STRENUOUS REASONING CAME TO A CONCLUSION THAT LONG TERM CAPITAL GAINS HAD ACCRUED TO THE APPELLANT. IT IS APPARENT, POST THE DECISION OF THE HONBLE HIGH COURT OF PUNJAB AND HARYANA THAT THE EXPLANATION/CLAIM/CONDUCT OF THE APPELLANT WAS REAS ONABLE ON HUMAN PROBABILITIES AND WAS DEFINITELY NOT IN THE NATURE OF VIOLATING SETTLED LEGAL POSITION ON THE MATTER. THE INTERPRETATION OF THE A PPELLANT IN TREATING THE RECEIPT OF CONSIDERATION AMOUNT AS ONLY AN ADVANCE PENDING FINAL PAYMENT OF THE ENTIRE CONSIDERATION INCLUDING THE B UILT UP FLAT WAS THUS NOT WHOLLY UNKNOWN TO LAW OR CONTRARY TO ALL KNOWN PROPOSITIONS. IT HAS BEEN CONSISTENTLY HELD BY VARIOUS HIGH COURTS INCLU DING THE I TA NO. 617(ASR)/2015 ASST. YEAR: 2007-08 5 JURISDICTIONAL HIGH COURT THAT CONCEALMENT PENALTY IS NOT LEVIABLE ON ISSUES OF ADDITION WHICH ARE DEBATABLE OR CAPABLE O F HAVING TWO VIEWS ON THE MATTER. IN FACT, IT HAS BEEN HELD IN MANY CASES THAT THE MOMENT THE IMPUGNED ISSUES ARE ADMITTED BY THE HONBLE HIGH CO URT UNDER THE PROVISIONS OF SECTION 260A OF THE ACT ON GROUNDS OF SUBSTANTIAL QUESTION OF LAW, THE DEBATABLITY OF THE IMPUGNED ISSUES GET ENDORSED AND CREDENCE IS LENT TO THE BONAFIDES OF THE CLAIM OF THE ASSESS EE. IN THE INSTANT CASE, THE FINDINGS RETURNED IN THE JUDGMENT OF THE HONBL E HIGH COURT ALMOST CONCURS WITH THE EXPLANATION/CLAIM OF THE APPELLANT . IN THIS VIEW OF THE MATTER, IMPOSITION OF CONCEALMENT PENALTY ON THE AP PELLANT CANNOT BE HELD TO BE JUSTIFIED. THE ASSESSING OFFICER IS DIRE CTED TO DELETE THE PENALTY. 5. ON FEELING AGGRIEVED AGAINST THE ORDER PASSED BY T HE LD. CIT(A), THE REVENUE DEPARTMENT PREFERRED THE INSTANT APPEAL AND SUBMITTED THE FOLLOWING STATEMENTS OF FACTS. THE ASSESSEE FILED HIS RETURN DECLARING INCOME OF RS.4,37,050/- ON 31.03.2008 FOR THE A.Y. 2007-08. THE SOURCE OF INCO ME WERE SHOWN BY THE ASSESSEE AS 'PENSION' AND 'BANK INTEREST'. SUBS EQUENTLY, A REVISED RETURN WAS FILED BY THE ASSESSEE ON 27.11.2009 DECL ARING INCOME OF RS.18,46,910/- WHICH CANNOT BE 'REVISED U/S 139(5) AND AS SUCH, THE REVISED RETURN FILED BY THE ASSESSEE WAS NOT A VALI D RETURN IN THE EYES OF LAW. SUBSEQUENTLY CERTAIN TANGIBLE INFORMATION CAME TO THE NOTICE OF THE THEN AO THAT THE LONG TERM CAPITAL GAIN AROSE TO TH E ASSESSEE CONSEQUENT UPON TRANSFER OF CERTAIN LAND BELONGING TO THE ASSE SSEE, WAS NOT DISCLOSED IN THE RETURN OF INCOME. ACCORDINGLY, REC OURSE TO THE PROCEEDINGS U/S 147 OF THE ACT WAS TAKEN AND NOTICE U/S 148 OF THE ACT WAS ISSUED ON 31.12.2009. ON COMPLETION OF THE ASSE SSMENT PROCEEDINGS U/S 143(3) READ WITH SECTION 148 OF THE ACT BY THE THEN AO VIDE ORDER DATED 24.12.2010, TOTAL INCOME WAS ASSESSED AT RS.1 ,81,72,890/- MAKING AN ADDITION OF RS.1,83,75,000/- ON ACCOUNT O F LONG TERM CAPITAL GAIN. THE ASSESSEE WAS A MEMBER OF THE PUNJABI COOP ERATIVE HOUSE BUILDING SOCIETY LIMITED, MOHALI WHICH WAS OWNER OF 21.2 ACRES OF LAND IN VILLAGE KANSAL, DISTT. SAS NAGAR, PUNJAB. LATER ON THE SOCIETY ENTERED INTO A TRIPARTITE AGREEMENT WITH M/S TATA HOUSING D EVELOPMENT COMPANY LTD., AND M/S HASH BUILDERS PVT. LTD., ON 2 5.02.2007. UNDER THE JOINT DEVELOPMENT AGREEMENT (JDA) DATED 25.02.2 007, IT WAS AGREED THAT HASH AND THDC (THE DEVELOPERS) SHALL UNDERTAKE DEVELOPMENT OF 21.2 ACRES OF LAND OWNED AND REGISTERED IN THE NAME OF THE SOCIETY AND AGREED CONSIDERATION WILL BE DISBURSED BY THDC THRO UGH HASH TO EACH INDIVIDUAL MEMBER OF THE SOCIETY HAVING PLOT SIZE O F 2250 SQ. YARD PARTLY IN MONETARY TERMS (RS.82,50,000/-) AND PARTLY IN TH E SHAPE OF FURNISHED PLOT MEASURING 2250 SQ.FT TO BE CONSTRUCTED BY M/S TATA HOUSING DEVELOPMENT COMPANY LTD. THE COST OF FURNISHED FLAT @ RS.4500 PER SQ. FT. HAVING AREA OF 2250 SQ.FT. EACH WAS DETERMINED AT RS.1,01,25,000/-. OUT OF THE TOTAL CONSIDERATION, AN AMOUNT OF RS.15, 00,000/- WAS RECEIVED BY THE ASSESSEE ON 25.02.2007 DURING THE YEAR UNDER CONSIDERATION. WHILE FRAMING ASSESSMENT, THE ASSESSING OFFICER HEL D THAT AS PER JDA, THE OWNER HAD TRANSFERRED ALL THE RIGHTS WHICH AN OWNER HAVE IN AN I TA NO. 617(ASR)/2015 ASST. YEAR: 2007-08 6 IMMOVABLE PROPERTY. ACCORDINGLY, THE AO CONSIDERATI ON THE ENTIRE AMOUNT OF RS.82,50,000/- AS WELL AS THE MARKET VALU E OF PLOT AT RS.1,01,25,000/- AS SALE CONSIDERATION WITHIN THE M EANING OF CLAUSES (II) (V) AND (VI) OF SECTION 2(47) OF THE ACT AND WORKED OUT THE CAPITAL GAINS ACCORDINGLY FOR THE A.Y. 2007-08. 1.2 INVOKING THE PROVISIONS OF SECTION 271(L)(C) OF THE INCOME TAX ACT, 1961. PENALTY PROCEEDINGS WERE INITIATED FOR CONCEA LMENT OF INCOME VIDE PENALTY NOTICE DATED 24.12.2010 BY THEN AO. 2.1 THE ASSESSEE'S 1 ST AND 2 ND APPEAL AGAINST THE ORDER PASSED U/S 147/143(3) WAS DISMISSED- BOTH BY ID. CIT(A), BATHI NDA AND ITAT, AMRITSAR RESPECTIVELY. KEEPING IN VIEW THE PROVISIO NS OF SECTION 275, PENALTY PROCEEDED WERE DECIDED BY IMPOSING A PENALT Y OF RS.36,63,550/- FOR CONCEALMENT OF INCOME IN THE SHAPE OF STCGS, VI DE ORDER DATED 24.03.2014. 2.2 AGGRIEVED WITH THE ORDER PASSED U/S 271 (1 )( C) OF THE INCOME TAX ACT, 1961, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE LD. CIT(A), BATHINDA, WHO VIDE HIS ORDER PASSED IN APPEAL NO. 2 0/IT/CIT(A)/BTI/14- 15 DATED 18.09.2015 ALLOWED APPEAL OF THE ASSESSEE BY OBSERVING THAT CONCEALMENT PENALTY IS NOT LEVIABLE ON ISSUES OF AD DITIONS WHICH ARE DEBATABLE OR CAPABLE OF HAVING TWO VIEWS ON THE MAT TER. THE LD. C1T(A) HELD THAT THE TRIBUNAL WAS OVERTURNED BY THE JUDGME NT OF HON'BLE HIGH COURT. THEREFORE THE ASSESSEE CANNOT BE PAID SAID T O HAVE GIVEN OR OFFERED AN EXPLANATION FOR NOT INCLUDING THE PURPOR TED CAPITAL GAINS IN HIS RETURN OF INCOME AS FALSE OR INDICATING OF AN A CT OF FRAUD OR GROSS OR WILLFUL NEGLIGENCE. 2.3. THE ORDER OF THE LD. CIT(A) DOES NOT SEEM TO BE ACCEPTABLE AS THE ADDITION MADE BY AO ON ACCOUNT OF CAPITAL GAIN ACCR UED TO THE ASSESSEE HAS BEEN CONFIRMED BY LD. CIT(A) AS WELL AS BY THE HON'BLE ITAT. 2.4 FOR THE SAKE OF CONVENIENCE, IT IS SUBMITTED THAT THE HON'BLE HIGH COURT ALSO CONFIRMED THE ADDITION TO THE EXTENT A P ROPORTIONATE SALE CONSIDERATION ACCRUED TO THE ASSESSEE WHILE DECIDIN G THE CASE OF C.S. ATWAL VS. CIT. THE DEPARTMENT IS FILLING SLP BEFORE THE HON'BLE SUPREME COURT SEPARATELY AGAINST THE VERDICT OF HON'BLE HIG H COURT. 3.1 THE LD. CIT(A) HAS NOT APPRECIATED THE FACT T HAT THE ASSESSEE HAD RECEIVED AN AMOUNT OF RS.15,00,000/- ON 25.02.2007 ON ACTUAL TRANSFER OF PROPORTIONATE SHARE OF LAND IN FAVOUR OF THE DEV ELOPER DURING THE RELEVANT FINANCIAL YEAR AND HENCE THE AMOUNT OF SAL E CONSIDERATION RECEIVED BY THE ASSESSEE CANNOT BE TERMED AS ADVANC E BY ANY STRETCH OF IMAGINATION. 3.2 THE QUANTUM ADDITION MADE BY AO ON ACCOUNT O F CAPITAL GAIN ACCRUED TO THE ASSESSEE HAS BEEN CONFIRMED BY LD. C 1T(A) AS WELL AS BY THE HON'BLE ITAT, AMRITSAR. THE HON'BLE HIGH COURT, IN THE CASE OF ASSESSEE, WHILE DECIDING THE CASE OF C.S. ATWAL VS. LUDHIANA HAS CONFIRMED THE ADDITION TO THE EXTENT OF PROPORTIONA TE SALE CONSIDERATION ACCRUED TO THE ASSESSEE ON ACTUAL TRANSFER OF LAND DURING THE YEAR. THEREFORE, THE OBSERVATION OF THE LD. CIT(A) THAT T HE ISSUE OF ADDITION IN THE CASE OF THE ASSESSEE IS DEBATABLE DOES NOT APPE AR TO BE CORRECT. THE ONLY DEBATABLE ISSUE IN THE MATTER IS WHETHER CAPIT AL GAIN TAX IS EXIGIBLE ON THE BALANCE PORTION OF LAND WHICH WAS NOT TRANSF ERRED IN THE NAME OF DEVELOPER AND POSSESSION THEREOF WAS, ACCORDING TO THE AO HANDED OVER TO THE DEVELOPER IN PART PERFORMANCE OF JDA DATED 2 5.02.2007. I TA NO. 617(ASR)/2015 ASST. YEAR: 2007-08 7 IN VIEW OF THE FOREGOING FACTS, IT IS PRAYED THAT T HE ORDER OF THE CIT(A). BATHINDA MAY KINDLY BE SET ASIDE AND THAT O F THE ASSESSING OFFICER MAY KINDLY BE RESTORED BACK. 6. ON THE OTHER HAND, THE LD. AR SUBMITTED THAT IN THE SIMILAR AND IDENTICAL CASES, THE JURISDICTIONAL HIGH COURT VIDE ORDE R DATED 22 ND JULY, 2015 IN PARA NO.46 IN THE CASE OF C.S. ATWAL VS. CIT, LUDHIANA & ANORS. ANALYZED THE POSITION AND DETERMINED THAT THE CAPITAL GAINS TAX HAS TO BE PAID ON WHATEVER AMOUNT HAS BEEN RECEIVED AN D THAT WHENEVER FURTHER AMOUNTS ARE RECEIVED, IT SHALL BE TA XABLE SUBSEQUENTLY. 7. AS IN THE INSTANT CASE, ALTHOUGH THE REVENUE DEPARTMEN T HAS TAKEN THE STAND THAT IN THE INSTANT CASE, THE RETURN W AS FILED ONLY ON 31 ST MARCH, 2008 BY DECLARING INCOME OF RS.4,37,050/- FOR T HE A.Y. 2007-08, HOWEVER, THE SAME WAS SUBSEQUENTLY REVISED ON DATED 27.11.2009 DECLARING INCOME OF RS.18,46,910/-, IN FACT THE BELATED RETURN CANNOT BE REVISED AND THEREFORE, CANNOT BE TREA TED AS VALID RETURN IN THE EYES OF LAW. WE HAVE GONE THOUGHTFUL CONSIDERATION TO THE AFORESAI D CONTENTION OF THE REVENUE DEPARTMENT AS THE HONBLE IT AT, DELHI BENCH, IN THE CASE OF ACIT, PANIPAT VS. ASHOK RAJ NATH, IN ITS ORDER DATED 31.08.2012 HAS HELD THAT WHERE A REVISED RETURN WAS FOUND TO BE INVALID BUT THE EXPLANATION MADE BY ASSESSEE IN HIS R EVISED RETURN WAS BONAFIDE, NO PENALTY U/S 271(1)(C) CAN BE MADE. I TA NO. 617(ASR)/2015 ASST. YEAR: 2007-08 8 FURTHER, WE FIND THAT HON'BLE PUNJAB & HARYANA HIGH CO URT IN THE CASE OF SH. RANJIT SINGH BRAHAMPURA, IN ITA NO.250 OF 2017 VIDE ITS ORDER DATED 18.07.2017, UNDER SIMILAR FACTS AND CIRCUMSTA NCES HAS DELETED THE PENALTY BY HOLDING AS UNDER: 3. WE HAVE HEARD LEARNED COUNSEL FOR THE APPELLANT . 4. THE MATTER IS NO LONGER RES INTEGRA. IN C.S. ATWAL S CASE (SUPRA) IN ITA NO. 200 OF 2013 DECIDED ON JULY 22, 2015, THE I SSUE INVOLVED IN THIS APPEAL STANDS DECIDED BY THIS COURT. IN THE SA ID CASE, THE FOLLOWING ISSUES EMERGED FOR CONSIDERATION:- (I) SCOPE AND LEGISLATIVE INTENT OF SECTION 2(47)(II), (V) AND (VI) OF THE ACT; (II) THE ESSENTIAL INGREDIENTS FOR APPLICABILITY OF SECT ION 53A OF 1882 ACT; (III) MEANING TO BE ASSIGNED TO THE TERM POSSESSION? (IV) WHETHER IN THE FACTS AND CIRCUMSTANCES, ANY TAXABLE CAPITAL GAINS ARISES FROM THE TRANSACTION ENTERED BY THE AS SESSEE? AFTER CONSIDERING THE RELEVANT STATUTORY PROVISIONS AND THE CASE LAW, THE FOLLOWING CONCLUSIONS WERE DRAWN:- (1) PERUSAL OF THE JDA DATED 25.02.2007 READ WITH SALE DEEDS DATED 2.03.2007 AND 25.04.2007 IN RESPECT OF 3.08 A CRES AND 4.62 ACRES RESPECTIVELY WOULD REVEAL THAT THE PARTIES HA D AGREED FOR PRO- RATA TRANSFER OF LAND. (2) NO POSSESSION HAD BEEN GIVEN BY THE TRANSFEROR TO THE TRANSFEREE OF THE ENTIRE LAND IN PART PERFORMANCE OF JDA DATED 25.02.2007 SO AS TO FALL WITHIN THE DOMAIN OF SECTION 53A OF 1882 ACT. (3) THE POSSESSION DELIVERED, IF AT ALL, WAS AS A L ICENSEE FOR THE DEVELOPMENT OF THE PROPERTY AND NOT IN THE CAPACITY OF A TRANSFEREE. (4) FURTHER SECTION 53A OF 1882 ACT, BY INCORPORATI ON, STOOD EMBODIED IN SECTION 2(47)(V) OF THE ACT AND ALL THE ESSENTIAL INGREDIENTS OF SECTION 53A OF 1882 ACT WERE REQUIRE D TO BE FULFILLED. IN THE ABSENCE OF REGISTRATION OF JDA DATED 25.02.2 007 HAVING BEEN EXECUTED AFTER 24.09.2001, THE AGREEMENT DOES NOT F ALL UNDER SECTION 53A OF 1882 ACT AND CONSEQUENTLY SECTION 2( 47)(V) OF THE ACT DOES NOT APPLY. I TA NO. 617(ASR)/2015 ASST. YEAR: 2007-08 9 (5) IT WAS SUBMITTED BY LEARNED COUNSEL FOR THE ASS ESSEE-APPELLANT THAT WHATEVER AMOUNT WAS RECEIVED FROM THE DEVELOPE R, CAPITAL GAINS TAX HAS ALREADY BEEN PAID ON THAT AND SALE DE EDS HAVE ALSO BEEN EXECUTED. IN VIEW OF CANCELLATION OF JDA DATED 25.02.2007, NO FURTHER AMOUNT HAS BEEN RECEIVED AND NO ACTION THER EON HAS BEEN TAKEN. IT WAS URGED THAT AS AND WHEN ANY AMOUNT IS RECEIVED CAPITAL GAINS TAX SHALL BE DISCHARGED THEREON IN AC CORDANCE WITH LAW. IN VIEW OF THE AFORESAID STAND, WHILE DISPOSIN G OF THE APPEALS, WE OBSERVE THAT THE ASSESSEE APPELLANTS SHALL REMAI N BOUND BY THEIR SAID STAND. (6) THE ISSUE OF EXIGIBILITY TO CAPITAL GAINS TAX HAVING BEEN DECIDED IN FAVOUR OF THE ASSESSEE, THE QUESTION OF EXEMPTIO N UNDER SECTION 54F OF THE ACT WOULD NOT SURVIVE ANY LONGER AND HAS BEEN RENDERED ACADEMIC. (7) THE TRIBUNAL AND THE AUTHORITIES BELOW WERE NOT RIGHT IN HOLDING THE ASSESSEE-APPELLANT TO BE LIABLE TO CAPITAL GAIN S TAX IN RESPECT OF REMAINING LAND MEASURING 13.5 ACRES FOR WHICH NO CO NSIDERATION HAD BEEN RECEIVED AND WHICH STOOD CANCELLED AND INC APABLE OF PERFORMANCE AT PRESENT DUE TO VARIOUS ORDERS PASSED BY THE SUPREME COURT AND THE HIGH COURT IN PILS. THEREFORE , THE APPEALS ARE ALLOWED. 5. LEARNED COUNSEL FOR THE APPELLANT HAS NOT BEEN A BLE TO CONTROVERT THE APPLICABILITY OF THE DECISION RENDERED IN C.S. ATWALS CASE (SUPRA) AND THAT NO CAPITAL GAINS ON UNREALIZED AMOUNT WOULD AC CRUE OR ARISE TO THE ASSESSEE. ONCE THAT IS SO, NO PENALTY UNDER SECTION 271(1) (C) OF THE ACT WOULD BE EXIGIBLE. THE SUBSTANTIAL QUESTIONS OF LAW CLAIMED IN THIS APPEAL ARE ANSWERED ACCORDINGLY. CONSEQUENTLY, THE APPEAL STANDS DISMISSED. AS IT IS WELL SETTLED LAW THAT ASSESSMENT PROCEEDINGS AND PE NALTY PROCEEDINGS ARE ENTIRELY DISTINCT FROM EACH OTHER, THE REFORE, WE ARE OF THE CONSIDERED VIEW THAT ALTHOUGH, THE REVISED RETURN CANNOT BE TAKEN INTO CONSIDERATION AS VALID RETURN, HOWEVER, THE SAME IS HAVING IMPORTANCE FOR ADJUDICATING THE ISSUE RELATED TO THE P ENALTY PROCEEDINGS. AS THE JURISDICTIONAL HIGH COURT IN THE SIMILAR AND ID ENTICAL CASES CLEARLY HELD THAT THE ACTUAL RECEIPT CAN BE SUBJECT TO TH E CAPITAL GAIN, I TA NO. 617(ASR)/2015 ASST. YEAR: 2007-08 10 BUT NOT ON THE ACCRUAL BASIS WHICH MAY OR MAY NOT COMES T O THE END OF THE HANDS OF THE ASSESSEE. RESULTANTLY, AS IN THE INSTANT CASE, THE ASSESSEE HAS SHOWN THE RECEIVED AMOUNT IN ITS REVISED RETURN OF INCOME, THEREF ORE, IT CANNOT BE TREATED AS CONCEALMENT OF THE PARTICULARS OF INCOME. HEN CE, WE ARE INCLINED TO DISMISS THE APPEAL OF THE REVENUE DEPARTMEN T. 7. IN THE RESULT, THE APPEAL FILED BY THE REVENUE DEPA RTMENT STANDS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 31.1 0.2017. SD/- SD/- (T. S. KAPOOR) (N.K.CHOUDHR Y) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED:31.10.2017. /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