Assistant Commissioner of Income-tax, V. Mr. Vilas Keshavrao Atudade, Aurangabad

ITA 66/PUN/2014

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 1173 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 7 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-08-2015
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 14-07-2015
• Assessment Year: 2005-2006
• Appeal Filed On: 13-01-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: S K JADAV
• Keywords: Capital asset; Opportunity of being heard; Additional evidence; Capital receipt
• Section: 143(3); 147; 148; 263

Judgement Text

] IQ.KS ] IQ.KS ] IQ.KS ] IQ.KS IQ.KS IQ.KSIQ.KS IQ.KS IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A, PUNE , . . , # BEFORE MS. SUSHMA CHOWLA, JM AND SHRI R.K. PANDA, AM . / ITA NO.66/PN/2014 % % / ASSESSMENT YEAR : 2005-06 ITO, WARD-2(3), AURANGABAD . / APPELLANT V/S MR. VILAS KESHAVRAO AUTADE, PLOT NO.42, SECTOR-H, N-5, CIDCO, AURANGABAD PAN NO.ABEPA5536G . / RESPONDENT / APPELLANT BY : SHRI S.K. JADAV / RESPONDENT BY : NONE . SINGH / ORDER PER R.K. PANDA, AM : THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAINST THE OR DER DATED 31-10-2013 OF THE CIT(A), AURANGABAD RELATING TO A SSESSMENT YEAR 2005-06. 2. THE NOTICE ISSUED THROUGH RPAD BY THE REGISTRY WAS R ETURNED UNSERVED BY THE POSTAL AUTHORITIES WITH THE REMARKS UN CLAIMED. SUBSEQUENTLY, THE NOTICE WAS ISSUED THROUGH THE REVENU E. EVEN THEN ALSO, THERE WAS NO RESPONSE FROM THE ASSESSEE, THE REFORE, THE / DATE OF HEARING : 14.07.2015 / DATE OF PRONOUNCEMENT:31.08.2015 2 ITA NO.66/PN/2014 MATTER IS BEING DECIDED ON THE BASIS OF MATERIAL AVAILABLE O N RECORD AND AFTER HEARING THE LD. DEPARTMENTAL REPRESENTATIVE. 3. FACTS OF THE CASE, IN BRIEF, ARE THAT THE ASSESSEE IS AN INDIVIDUAL. HE SOLD RESIDENTIAL PLOTS AT GUT NOS. 222/1 TO 22 2/6 AT KUMBHELPHAL, TALUK & DIST. AURANGABAD JOINTLY WITH 5 OTHER CO- OWNERS VIDE SALE DEED DATED 01-07-2014 TO BHOSALE BUILD ERS AND DEVELOPERS PVT. LTD. THE A.O. NOTICED THAT THE ASSESSEE H AS NOT FURNISHED RETURN OF INCOME DECLARING LONG TERM CAPITAL GAIN O N ACCOUNT OF SALE OF THE ABOVE MENTIONED PLOTS. HE, THEREFOR E, ISSUED NOTICE U/S 148 OF THE ACT DATED 07-08-2008. THE ASSES SEE FILED OBJECTION TO THE SAID NOTICE VIDE SUBMISSION DATED 22-1 2-2009. THE A.O. AFTER CONSIDERING THE SUBMISSION OF THE ASSESSEE DROPP ED THE PROCEEDINGS ON 29-12-2009 INITIATED BY ISSUING NOTICE U/S 148 OF THE ACT. THE CIT, AURANGABAD VIDE ORDER U/S 263 DATED 21-0 3-2012 TREATED THE ORDER OF THE A.O. DROPPING THE RE-ASSESSMEN T PROCEEDINGS AS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVE NUE AND SET- ASIDE THE SAID ORDER. THE RELEVANT PORTION OF THE ORDER O F CIT, AURANGABAD IS REPRODUCED BELOW : 'IN THE LIGHT OF ABOVE DIRECTIONS OF THE HON'BLE ITA T, THE AO HAS REFRAMED THE ASSESSMENT IN THESE THREE CASES. DURING THE COURSE OF PROCEEDINGS, IT WAS OBSERVED BY THE AO THAT THE ADDITIONAL EVIDENCE P LACED BEFORE THE ITAT I.E. COPY OF COMPROMISE DECREE IN CIVIL SUIT NO . 623/2008 WAS NOT HONORED WITHIN STIPULATED PERIOD AND THEREAFTER, A F RESH COMPROMISE TOOK PLACE ON 19.11.2011, WHEREIN ALL THE DISPUTES P ERTAINING TO THE SAID SALE TRANSACTIONS EXECUTED ON 30.06.2004 HAD BEEN RESOL VED. IT IS ALSO OBSERVED FROM THE RECORDS AND STATEMENT ON OATH RECORD ED BY THE AO U/SEC. 131(1)(B) OF THE ACT OF THESE THREE PERSONS THAT THEY HAVE ADMITTED THAT ALL THE DISPUTED ISSUES HAVE BEEN SETTLED VIDE COMPROMISE DEED 19.11.2011 AND THE SALE OF PLOTS OF LAND AT KHUM BHEPHAL EXECUTED ON 30.06.2004 RELEVANT TO A. Y. 2005-06 ATTRACTS CAP ITAL GAIN TAX AND ACCORDINGLY, THE CO-OWNERS HAVE PAID THE TAX FOR A. Y. 2005-06. THE COPY OF SAID COMPROMISE DEED EXECUTED ON 19.11.2011 WAS ALSO BROUGHT ON RECORD BY THE AO, WHEREIN THE PRESENT ASSESSEE IS ALSO ONE OF THE BENEFICIARIES. HOWEVER, DURING THE COURSE OF REVISION PROCEEDINGS, IT WAS CONTENDED BY THE ASSESSEE THAT AGREEMENT TO SALE TO THE EXTENT OF HIS PORTION HAS BEEN CONCEALED AND NOW THE LAND IN QUESTI ON IS IN HIS 3 ITA NO.66/PN/2014 POSSESSION. IT WAS FURTHER CONTENDED THAT IN THE LAND RE CORDS HIS NAME HAS BEEN ENTERED BY THE REVENUE AUTHORITIES AND STATED THAT AS NO SALE TRANSACTION HAS BEEN EXECUTED THERE IS NO CASE OF CAPIT AL GAIN TAX PAYABLE BY HIM. I HAVE CONSIDERED THE SUBMISSIONS CAREFULLY AND I AM OF THE CONSIDERED OPINION THAT THE ISSUES RAISED IN THE SHOW CAU SE NOTICE REQUIRES FRESH VERIFICATION. THEREFORE, IN EXERCISE OF THE POWERS CONFERRED UPON BY THE PROVISIONS OF SECTION 263 OF THE I. T. ACT, 1961, I AM OF THE OPINION THAT IT WOULD BE FAIR AND JUST, I F THE MATTER IS RESTORED BACK TO THE AO. FOR RECONSIDERATION OF THE ABOVE ISSUE S IN THE LIGHT OF THE SUBMISSIONS MADE BY THE ASSESSEE VIDE LETTER DATED 21.03.20 12 AND THE FACTS DISCUSSED ABOVE. THAT BEING SO, THE ORDER PASSED BY THE ITO, WD- 2(3), AURANGABAD BY DROPPING THE PROCEEDINGS U/S. 147 OF THE ACT, ARE HEREBY SET ASIDE WITH A DIRECTIONS THAT THE ASSESSMENT OR DER SHOULD BE REFRAMED AS PER THE PROVISIONS OF LAW AFTER CONSIDERING PROPER FACTS AND SUBMISSIONS OF THE ASSESSEE. THE ASSESSEE MAY BE GIVEN REASONABL E OPPORTUNITY OF BEING HEARD BEFORE PASSED FRESH ASSESSMENT ORDER.' 4. CONSEQUENT UPON THE ORDER U/S.263 OF THE ACT, THE A O ISSUED NOTICE U/S.142(1) ON 22-03-2012 REQUIRING THE ASSESSEE T O SUBSTANTIATE HIS CLAIMS MADE BEFORE THE CIT, AURANGABAD IN THE PROCEEDINGS U/S.263 OF THE ACT WITH DOCUMENTARY EVIDENCE . SINCE THERE WAS NO COMPLIANCE TO THIS NOTICE AND TO THE 3 OT HER NOTICES ISSUED SUBSEQUENTLY THE AO ISSUED A NOTICE U/S.144/142(1 ) OF THE ACT IN COMPLIANCE TO WHICH THE ASSESSEE ATTENDED AND FILED CERTAIN DETAILS. SUBSEQUENTLY, THE ASSESSEE FURNISHED A RETURN O F INCOME ON 08-01-2013 WITH A REMARK IN RESPONSE TO NOTICE U/S.148 OF THE ACT AT 07-08-2008 DECLARING BANK INTEREST OF RS.258/- AND E XEMPT AGRICULTURAL INCOME OF RS.1,78,058/. THE AO, THEREFORE, ISSUED NOTICE U/S.143(2) AND 142(1). AFTER CONSIDERING THE VARIOUS SUBMISS IONS MADE BY THE ASSESSEE THE AO MADE ADDITION OF RS.39,75,000 /- TO THE TOTAL INCOME OF THE ASSESSEE. WHILE DOING SO, THE AO POINTE D OUT IN THE ASSESSMENT ORDER THAT IN THE CASE OF OTHER CO OWN ERS., THE A.O. HAS MADE ADDITION ON ACCOUNT OF CAPITAL GAIN WHICH HAS BE EN CONFIRMED BY THE CIT(A). THE TRIBUNAL, HOWEVER, WHILE DECIDING THE APPEALS OF THE OTHER CO-OWNERS HAS SET-ASIDE THE ORDER OF CIT(A) VIDE 4 ITA NO.66/PN/2014 ORDER ELATED 17-05-2010 WITH THE DIRECTION THAT 'THE A .O. SHALL ADMIT THE ADDITIONAL EVIDENCE AND ANY OTHER EVIDENCE THAT MAY BE PRODUCED BY THE ASSESSEE WHICH MAY GO INTO THE ROOT OF THE MATT ER AND ADJUDICATE THE ISSUE AFRESH AFTER GIVING AN OPPORTUNITY OF BEING HEARD TO THE ASSESSEE.' THE ASSESSMENT ORDERS U/S 143(3) R.W .S. 254 DATED 09-12-2011 IN THE CASES OF THE SAID OTHER CO-OWNERS HA VE BEEN PASSED BY THE A.O. AND THE CAPITAL GAIN HAS BEEN ASSESSED IN THEIR HANDS. THE SAID CO-OWNERS HAVE ALSO PAID THE DEMANDS BY ACCEPTING THE CAPITAL GAIN TAXED BY THE A.O. 5. IN THE CASE OF THE ASSESSEE, THE A.O. HAS TAXED AN AMOUNT OF RS.39,75,000/- IN THE HANDS OF THE ASSESSEE UNDER THE HE AD 'INCOME FROM OTHER SOURCES' HOLDING THAT THE SAID AMOUNT FORFEITED BY THE ASSESSEE WHICH HAS BEEN RECEIVED AS PER THE SALE DEED DATED 01-07-2004 AS REVENUE RECEIPT AND IS TAXABLE UNDER THE HEAD 'INCOME FROM OTHER SOURCES'. AFTER CONSIDERING THE VARIOUS SUBMIS SIONS MADE BY THE ASSESSEE THE AO MADE ADDITION OF RS.39,75,000/- TO THE TOTAL INCOME OF THE ASSESSEE IN VIEW OF THE FOLLOWING REASONS AS SUMMARISED BY LD.CIT(A) AT PARA 5.1 OF HIS ORDER AND WHICH READS AS UNDER : 1. THE MONEY RECEIVED BY THE ASSESSEE AMOUNTING TO RS.3 9,75,000/- IS NOT TOWARDS ANY ADVANCE OR OTHER MONEY AS ENVISA GED IN SECTION 51 OF THE ACT. (2) THE CAPITAL ASSET ON PREVIOUS OCCASION IS TO BE SUBJ ECT OF NEGOTIATION OF TRANSFER, WHEREAS IN THE CASE UNDER APP EAL THE AMOUNT WAS RECEIVED AS PER SALE DEED AFTER FINALIZATION OF NEGOT IATIONS. (3) THE ADVANCE OR EARNEST MONEY IS RECEIVED BEFORE E XECUTION OF SALE DEED AND IS RETAINED WHERE THERE IS DEFAULT ON THE PA RT OF PURCHASER TO HONOUR THE PROPOSED DEED. IN THE CASE UNDER APPEAL, T HE SALE DEED HAS BEEN ENTERED INTO AND AN AMOUNT OF RS.39,75,000/- HA S BEEN RECEIVED BY CHEQUES AFTER THE DATE OF SALE DEED I.E. DURING 31/07 /2004 TO 02/11/2004. THEREFORE, THE AMOUNT RECEIVED BY THE A SSESSEE IS NOT AN ADVANCE OR EARNEST MONEY BUT IS MONEY GIVEN TOWARDS SAL E CONSIDERATION OF THE TRANSACTION. 5 ITA NO.66/PN/2014 (4) THE 'OTHER MONEY' IN THE CONTEXT OF THE PROVISIO NS OF SECTION 51 INCLUDES DEPOSIT MADE BY THE PURCHASER FOR GUARANTEE O F DUE PERFORMANCE OF THE CONTRACT AND NOT FORMING PART OF CONSIDERATION AS LAID DOWN BY HON'BLE SUPREME COURT IN THE CASE OF TRAVANC ORE RUBBER & TEA CO. LTD. VS. CIT (2000) 243 ITR 158. IN THE CASE UND ER APPEAL, THE AMOUNT OF RS.39,75,000/- IS PART OF SALE CONSIDERATION. (5) IF THE PAYMENT IS MADE ONLY TOWARDS PART CONSIDERA TION AND NOT INTENDED AS EARNEST MONEY, THE FORFEITURE CLAUSE, WIL L NOT APPLY AS LAID DOWN BY HON'BLE SUPREME COURT IN THE CASE OF SATISH B ATRA VS. SUDHIR RAWAL (C.A. NO.7588 OF 2012 ARISING OUT OF SLP CIVIL NO.4605 OF 2012) VIDE ORDER DATED 18/10/2012. (6) THERE IS NO STIPULATION ABOUT FORFEITURE OF THE AMOUNT PAID IN THE SALE DEED DATED 01/07/2004. (7) WHETHER THE RECEIPT IS CAPITAL OR REVENUE IS TO BE DECIDED ON THE FACTS AND CIRCUMSTANCES OF EACH CASE. THERE IS NO THUMB RULE TO DECIDE THE ISSUE. (8) THE ADVANCE RECEIPT IS REVENUE RECEIPT AND ACCRU ED AS INCOME AS SOON AS IT IS RECEIVED AND IS CHARGEABLE TO TAX. (9) RECEIPT FROM TERMINATION OF AGREEMENT IS REVENU E RECEIPT. (10) THE LAND WAS PURCHASED BY THE APPELLANT FOR RS.64 ,000/- AS AGAINST THE SAME HE HAS RETAINED AN AMOUNT OF RS.39,75,000/-. THEREFORE, AFTER DEDUCTING THE COST, THE REMAINING AMOUNT WOULD BE SUR PLUS OF RS.39,11,000/-, WHICH HAS BEEN CLAIMED BY THE ASSESSEE AS CAPITAL RECEIPT. THIS IS NOT THE INTENTION OF LEGISLATURE FOR INTRODUCING SECTION 51 OF THE ACT AND THE INTENTION IS THAT THE ASSESSEE SHOULD PAY MORE CAPITAL GAIN TAX BY REDUCING THE EARNEST MONEY FORFEITED. (11) INCOME FROM OTHER SOURCES AS PER SECTION 56(1) COV ERS INCOME OF EVERY KIND WHICH IS NOT TO BE EXCLUDED FROM THE TOTA L INCOME UNDER THE ACT. (12) THE AMOUNT OF RS.39,75,000/- FORFEITED BY THE A PPELLANT CANNOT BE TREATED AS CAPITAL RECEIPT AS ENVISAGED IN SECTION 51 OF THE ACT AND ON THE FACTS AND CIRCUMSTANCES OF THE CASE. 6. BEFORE CIT(A) IT WAS ARGUED THAT THE AMOUNT OF RS.39,75,0 00/- FORFEITED BY THE ASSESSEE IS A CAPITAL RECEIPT. THE AO IGN ORED THE FACT THAT IN RESPECT OF THE LAND RETAINED BY THE ASSESSEE, TH E ASSESSEE HAS PAID AN AMOUNT OF RS.25 LAKHS TO THE OTHER CO-OWNERS TO WARDS THEIR SHARES IN THE JOINT PROPERTY. IT WAS ARGUED THAT THE P URCHASER OF THE LAND, M/S BHOSALE BUILDERS & DEVELOPERS PVT. LTD. HAS NOT FULFILLED THE TERMS AND CONDITIONS OF THE SALE DEED DATED 01-07- 2004 ENTERED 6 ITA NO.66/PN/2014 INTO BY THE ASSESSEE AND OTHER CO-OWNERS AND HAS NOT PAID FULL AMOUNT AS PREVIOUSLY AGREED AND HAS FRAUDULENTLY CLAIMED THE SAID LAND AS N.A. LAND WITHOUT PAYING 'NAZRANA' TO THE COLLECTOR AND HENCE CIVIL SUIT HAS BEEN FILED AGAINST THE PURCHASER WITH C IVIL JUDGE, SENIOR DIVISION, AURANGABAD IN F.Y.2008-09 WHICH HAS B EEN REGISTERED AS SPECIAL CIVIL SUIT NO.623/2008. THE SAID SUIT HA S BEEN DECIDED VIDE ORDER DATED 12-10-2011 AND THE SDO(REVENU E), AURANGABAD HAS ORDERED THAT THE LAND SOLD AT GUT NO.22 2/13 ADMEASURING 4 ACRES 32 R (1 H 92 R) AND MUTATION ENTRY NO.3003 HAS BEEN ENTERED IN 7/12 EXTRACT VESTING THE OWNERSHIP OF THE LAND IN THE NAME OF M/S. BHOSALE BUILDERS & DEVELOPERS PVT. LTD. IS TO BE CANCELLED. IN VIEW OF THIS ORDER, FRESH MUTATION ENTRY NO.336 2 HAS BEEN MADE ON 7/12 EXTRACT OF THE LAND SHOWING ASSESSEE S OWNERSHIP ON THE SAID LAND. IN SUPPORT OF THIS CONTENTION, THE ASS ESSEE FILED WITH THE A.O., THE 7/12 EXTRACT OF THE IMPUGNED LAND FOR T HE YEAR 2004-05 DATED 12-01-2013 AS PER WHICH THE OWNER AND THE CULTIVATOR OF THE LAND HAS BEEN STATED TO BE SHRI VILAS KESHAVRAO AUTADE. THE ASSESSEE ALSO FILED WITH THE A.O., A COPY OF NOTINGS IN RESPEC T OF THE IMPUGNED LAND ABOUT CHANGES IN THE OWNERSHIP OF THE LAND MAINTAINED BY REVENUE AUTHORITIES. THE ASSESSEE, LIKE OTHER CO- OWNERS, HAS NOT OPTED TO SELL HIS SHARE IN THE IMPUGNED LA ND TO THE PURCHASER COMPANY AS CAN BE NOTED FROM THE COMPROMIS E OF THE PARTIES BEFORE HONBLE SPECIAL DISTRICT COURT, AURANGABAD A ND HENCE ASSESSEES SHARE/PORTION OF THE IMPUGNED LAND HAS BEEN RE-VESTED IN THE ASSESSEES OWN NAME. IT WAS ARGUED THAT THE PROVISIONS O F SECTION 51 COULD NOT BE READ IN ISOLATION AND WITHOUT CONSIDERING T HE FACTS OF THE CASE OF THE ASSESSEE WHICH ARE EXCEPTIONAL. THE AS SESSEE ARGUED THAT THE AMOUNT OF RS.39,75,000/- RECEIVED AGAINST SALE IS TO BE 7 ITA NO.66/PN/2014 REGARDED AS OTHER MONEY WITHIN THE MEANING OF SECTION 51 OF THE ACT. THE AMOUNT RECEIVED RS.39,75,000/- IS IN RESPECT OF CAPITAL ASSET, I.E. LAND AND HENCE THE FORFEITURE OF THE SAME IS A CAPITAL REC EIPT AND NOT REVENUE RECEIPT. IT WAS ARGUED THAT THE FACTS OF THE CASES RELIED ON BY THE A.O. ARE TOTALLY DIFFERENT AND ARE NOT APPLICABLE TO THE FACTS OF THE CASE OF THE ASSESSEE. REFERRING TO THE DECISION OF THE M UMBAI BENCH OF THE TRIBUNAL IN THE CASE OF SMT. SMITA N. SHAH VS. JCIT RE PORTED IN 95 TTJ 640 IT WAS SUBMITTED THAT ONCE THE SALE OF PROP ERTY DOES NOT FRUCTIFY AND THE ADVANCE IS FORFEITED BY THE ASSESSEE , THE FORFEITED AMOUNT CANNOT BE CONSIDERED TO BE CAPITAL GAIN AS NO TR ANSFER OF ASSET IS EFFECTED. 7. BASED ON THE ARGUMENTS ADVANCED BY THE ASSESSEE T HE LD.CIT(A) DIRECTED THE AO TO DELETE THE ADDITION OF RS.39,75,0 00/- BY OBSERVING AS UNDER : 5.3 I HAVE CAREFULLY CONSIDERED THE FACTS OF THE CA SE AND RIVAL CONTENTIONS. ON PERUSAL OF THE SAME, IT HAS BEEN NOTIC ED THAT THE APPELLANT HAS ENTERED INTO A SALE DEED AND RECEIVED PART CONSIDERATION AGAINST THE SALE TO THE EXTENT OF RS.39,75,000/-. AS M /S BHOSALE BUILDERS & DEVELOPERS PVT. LTD. HAS NOT FULFILLED THE TERMS AND C ONDITIONS OF THE SALE DEED DATED 01/07/2004 ENTERED INTO BY THE APPEL LANT AND OTHER CO- OWNERS AND HAS NOT PAID FULL AMOUNT AS PREVIOUSLY AGREE D AND HAS FRAUDULENTLY CLAIMED THE SAID LAND AS N.A. LAND WITHO UT PAYING 'NAZRANA' TO THE COLLECTOR AND HENCE CIVIL SUIT HAS BEEN FILED AGAINST THE PURCHASER WITH CIVIL JUDGE, SENIOR DIVISION, AURANGABAD IN F.Y .2008-09 WHICH HAS BEEN REGISTERED AS SPECIAL CIVIL SUIT NO.623/2008. FU RTHER, AS PER ORDER OF THE SDO (REVENUE), AURANGABAD, THE MUTATION ENTR Y NO.3362 HAS BEEN MADE ON 7/12 EXTRACT OF THE LAND SHOWING APPELLANT'S OWNERSHIP ON THE SAID LAND. THEREFORE, THE SAID DEED WAS CANCELLED AS FA R AS APPELLANT IS CONCERNED. THE SAID AMOUNT OF RS.39,75,000/- RECEIVED AS PART CONSIDERATION TOWARDS SALE OF LAND WHICH HAS BEEN LATER ON CANCELLED HAS BEEN FORFEITED BY THE APPELLANT. IT IS UNDISPUTED FAC T THAT THE SAID CONSIDERATION HAS BEEN RECEIVED IN RESPECT OF THE LAND WHICH IS A CAPITAL ASSET, THEREFORE, IN MY CONSIDERED VIEW THE RECEIPT OF RS.39,75,000/- IS ALSO CAPITAL RECEIPT WHICH IS NOT LIABLE TO TAX. AS RE GARDS, THE CONTENTION OF THE A.O. THAT AT LEAST THE AMOUNT OF RS.39,11,000/ - [RS.39,75,000/- (-) RS.64,000/-], FORFEITED IN EXCESS OF THE COST OF THE LA ND IS TO BE TREATED AS INCOME FROM OTHER SOURCES CONSIDERING THE LEGISLATIVE I NTENT, IT HAS BEEN NOTICED THAT THIS ISSUE IS COVERED BY THE RATIO LAID DO WN BY THE DECISION IN THE CASE OF SMT.SMITA N. SHAH VS. JCIT (2005) 94 ITD 492 (MUMBAI). THE CONTENTION OF THE APPELLANT IS ALSO SUPPORTED BY THE R ATIO LAID DOWN IN 8 ITA NO.66/PN/2014 THE CASE OF TRAVANCORE RUBBER & TEA CO. LTD. VS. CIT (2000) 243 ITR 158 (SC). IN VIEW OF THE ABOVE FACTS AND DISCUSSION, I AM O F THE CONSIDERED VIEW THAT THE AMOUNT OF RS.39,75,000/- FORFEITED WHI CH HAS BEEN RECEIVED IN RESPECT OF SALE OF LAND WHICH HAS BEEN CA NCELLED ON LATER DATE CANNOT BE REGARDED AS REVENUE RECEIPT IN THE HANDS OF THE APPELLANT AND THE SAME IS NOT LIABLE TO TAX BEING CAPITAL RECEIPT. THE CONTENTION OF THE A.O. IS ACCORDINGLY REJECTED. THE A.O. IS DIRECTED T O DELETE THE ADDITION OF RS.39,75,000/-. GROUND NOS. 1 & 2 ARE ALLOWED. 6. GROUND NO.3 IS THAT THE AO. HAS NOT CONSIDERED THE FACT THAT THE APPELLANT HAS MADE PAYMENT OF RS.25,00,000/- TO OTHER CO-OWNERS FOR RELINQUISHMENT OF THEIR RIGHT IN THE SHARE OF THE LAN D RETAINED BY THE APPELLANT. THE LD.AR OF THE APPELLANT HAS ARGUED TH AT THE SAID AMOUNT PAID TO THE CO-OWNERS IS TO BE ADDED TO THE COST OF TH E LAND AND THE TOTAL COST OF THE LAND THEREAFTER SHOULD HAVE BEEN REDUCED BY AMOUNT FORFEITED AND THE BALANCE AMOUNT OF RS.14,11,000/- [RS.39,75,00 0 (-) RS.64,000/- (-) RS.25,00,000/- IS TO BE TREATED AS CAPITAL RECEIPT NOT LIABLE TO TAX IN VIEW OF PROVISIONS OF SECTION 51 OF THE ACT AND THE DE CISION IN THE CASE OF SMT.SMITA N. SHAH VS. JCIT (2005) 94 ITD 492 (MUMBAI ). IT HAS BEEN NOTICED FROM THE ASSESSMENT ORDER THAT THE AO. HAS NOT CONSIDERED/REBUTTED THE ABOVE CONTENTION OF THE APPE LLANT. HOWEVER, AS THE TOTAL ADDITION OF RS.39,75,000/- HAS BEEN DELETED WHILE DECIDING GROUND NOS.1 & 2, THIS GROUND HAS BECOME ACADEMIC AND HENCE NOT REQUIRED TO BE ADJUDICATED. 8. AGGRIEVED WITH SUCH ORDER OF THE CIT(A) THE REVENUE IS IN APPEAL BEFORE US WITH THE FOLLOWING GROUNDS : 1) WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE HONBLE CIT(A) WAS JUSTIFIED IN CONSIDERING FORFEITED AMOUNT OF RS.39,75,000/- AS CAPITAL RECEIPT NOT LIABLE TO TAX B Y APPLYING PROVISION OF SEC.51, IGNORING THE FACT THAT THERE WAS NO TRANSFER O F CAPITAL ASSET AS ENVISAGED U/S.2(47) OF THE ACT? 2. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE, THE HONBLE CIT(A) WAS RIGHT IN NOT CONSIDERING THE DECISI ON OF THE HONBLE SC IN THE CASE OF TRAVANCORE RUBBER & TEA CO. LTD. R EPORTED IN 243 ITR 158, WHEREIN THE HONBLE COURT HAS SPECIFICALLY EXCLU DED THE MONEY WHICH IS FORMING PART OF CONSIDERATION WHILE DENOTING OTHER MONEY AS ENVISAGED U/S.51 OF THE ACT? 3. THE ORDER OF THE AO BE RESTORED AND THAT OF THE H ONBLE CIT(A) BE VACATED. 4. THE APPELLANT CRAVES LEAVE TO ADD, AMEND, OR ALTE R ANY GROUNDS OF APPEAL. 9. THE LD. DEPARTMENTAL REPRESENTATIVE OBJECTED TO THE ORDER OF THE CIT(A). HE SUBMITTED THAT SINCE THERE WAS NO TRANSFE R OF CAPITAL ASSET AS ENVISAGED U/S.2(47) OF THE ACT, THE CIT(A) WAS NOT JUSTIFIED IN 9 ITA NO.66/PN/2014 CONSIDERING THE FORFEITED AMOUNT OF RS.39,75,000/- AS CAPITAL RECEIPT NOT LIABLE TO TAX. HE SUBMITTED THAT THE OTHER CO-OWNER S HAVE ADMITTED THE CAPITAL GAIN IN THEIR RESPECTIVE HANDS. THER EFORE, THE ASSESSEE BEING ONE OF THE CO-OWNER CANNOT ESCAPE FROM THE TAX LIABILITY. 10. WE HAVE CONSIDERED THE ARGUMENTS ADVANCED BY THE LD. DEPARTMENTAL REPRESENTATIVE, PERUSED THE ORDERS OF THE AO AND CIT(A) AND THE PAPER BOOK FILED ON BEHALF OF THE ASSESSEE. WE FIND IN THE INSTANT CASE THE ASSESSEE ALONG WITH 5 OTHER CO-OW NERS HAD SOLD RESIDENTIAL PLOTS TO BHOSALE BUILDERS AND DEVELOPERS PVT. LT D. VIDE SALE DEED DATED 01-07-2004. SINCE THE ASSESSEE HAS NOT DECLARED ANY INCOME IN HIS HANDS FROM THIS TRANSACTION, THE AO TAXED TH E AMOUNT OF RS.39,75,000/- IN THE HANDS OF THE ASSESSEE UNDER TH E HEAD INCOME FROM OTHER SOURCES HOLDING THAT THE SAID AMOUNT FORFEITED BY THE ASSESSEE WHICH HAS BEEN RECEIVED AS PER THE SALE D EED DATED 01-07-2004 IS REVENUE RECEIPT AND IS TAXABLE UNDER THE HEAD INCOME FROM OTHER SOURCES. WE FIND IN APPEAL THE LD.CIT(A) HELD TH AT THE AMOUNT OF RS.39,75,000/- FORFEITED BY THE ASSESSEE WHICH HA S BEEN RECEIVED IN RESPECT OF SALE OF LAND WHICH HAS BEEN CANCELLED ON A LATER DATE CANNOT BE REGARDED AS REVENUE RECEIPT IN THE HAN DS OF THE ASSESSEE AND THE SAME IS NOT LIABLE TO TAX BEING CAPITAL R ECEIPT. WE FIND IN THE CASE OF THE OTHER CO-OWNERS THE AO OF THE CO-OWNERS ON THE BASIS OF THE DIRECTION OF THE TRIBUNAL HAS TREATED THE AM OUNT AS CAPITAL GAIN AND THE RESPECTIVE CO-OWNERS HAVE ALSO ACCE PTED THE CAPITAL GAIN TAXED BY THE AO AND PAID THE DEMAND. THE L D.CIT(A) HAS NOT GIVEN ANY REASON AS TO WHY AND HOW THE ORDER OF THE TRIBUNAL IN THE CASE OF THE OTHER CO-OWNERS UNDER IDENTICAL FACTS IS NOT APPLICABLE TO THE ASSESSEE. CONSIDERING THE TOTALITY OF THE FACTS OF THE 10 ITA NO.66/PN/2014 CASE AND IN THE INTEREST OF JUSTICE, WE DEEM IT PROPER TO RESTORE THE ISSUE TO THE FILE OF THE AO WITH A DIRECTION TO DECIDE THE ISSUE IN THE LIGHT OF THE DIRECTION GIVEN BY THE TRIBUNAL IN THE CASE OF T HE OTHER CO- OWNERS AND IN ACCORDANCE WITH LAW. NEEDLESS TO SAY THE AO SHALL GIVE DUE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE AS PER LAW. WE HOLD AND DIRECT ACCORDINGLY. 11. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 31-08-2015. SD/- SD/- ( SUSHMA CHOWLA ) ( R.K. PANDA ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER IQ.KS PUNE ; DATED : 31 ST AUGUST, 2015. LRH'K ' (*+ ,+ / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. $ ( ) / THE CIT(A), AURANGABAD 4. $ / THE CIT, AURANGABAD 5. ' **+, +, IQ.KS / DR, ITAT, A PUNE; 6. / / GUARD FILE. / BY ORDER , ' * //TRUE C ' * //TRUE COPY// 12 * + / SR. PRIVATE SECRETARY +, IQ.KS / ITAT, PUNE