Smt. Madhu Gupta W/o Sh. Ved Parkash Gupta, Sangrur V. ACIT, Circle, Sangrur

ITA 672/CHANDI/2018

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 5324 (ITAT-CHANDIGARH)
• Duration Of Justice: 8 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-01-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2013-2014
• Appeal Filed On: 10-05-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANJIT SINGH
• Assessee Lawyers: N K GARG SHRI VIBOUR GARG

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, B, CHANDIGARH , ! '# $ % & '# , () BEFORE SHRI SANJAY GARG, JUDICIAL MEMBER AND MS. ANNAPURNA GUPTA, ACCOUNTANT MEMBER ./ ITA NO. 672/CHD/2018 / ASSESSMENT YEAR : 2013-14 SMT. MADHU GUPTA, W/O SH. VED PARKASH GUPTA, SHANTI KUNJ, AGGAR NAGAR, ST.NO.3, SANGRUR THE ACIT, CIRCLE, SANGRUR ./PAN NO: ACEPG2747A / APPELLANT /RESPONDENT ! /ASSESSEE BY : SHRI N.K. GARG, ADVOCATE SHRI VIBOUR GARG, CA ' ! / REVENUE BY : SHRI MANJIT SINGH, SR.DR # $ % /DATE OF HEARING : 15.01.2019 &'() % / DATE OF PRONOUNCEMENT : 29.01.2019 (* / ORDER PER SANJAY GARG, JUDICIAL MEMBER: THE PRESENT APPEAL HAS BEEN PREFERRED BY THE ASSESS EE AGAINST THE ORDER DATED 28.2.2018 OF THE COMMISSIONER OF INCOME TAX (APPEALS )- 3, LUDHIANA [HEREINAFTER REFERRED TO AS CIT(A)]. 2. THE ASSESSEE IN THIS APPEAL HAS TAKEN FOLLOWING GROUNDS OF APPEAL: 1. THAT THE IMPUGNED APPELLATE ORDER IS BAD BOTH ON FACTS AND LAW. 2. THAT THE LD. APPELLATE AUTHORITY HAS WRONGLY AND ILLEGALLY HELD THAT GOA NO. 2,THAT THE LD.AO HAS WRONGLY AND ILLEGALLY DISALLOWED THE EXPENDIT URE ON THE IMPROVEMENT OF ASSETS IGNORING THE M ATERIAL ON RECORD MERELY ON GUESS AND SURMISES' IS OF GENE RAL NATURE AND HAVING NO NEED TO GIVE ANY SPECIFIC COMMENTS. ITA NO. 672/CHD/2018- SMT. MADHU GUPTA, SANGRUR 2 3. THAT THE LD. APPELLATE AUTHORITY, IN PARA 4.2 OF IMPUGNED ORDER, HAS WRONGLY AND ILLEGALLY HELD THAT APPELLANT HAS NOT CONTESTED THE ADDITION OF RS. 5,97,465/- IN APPEAL I.E. FORM NO. 35 IGNORING THE GOA NO. 2 AND THE WRITTEN SUBMISSIONS AND CONSEQUENTLY WRONGLY AND ILLEGALLY DISMISSED THE GOA. 4. THAT THE LD. APPELLATE AUTHORITY WRONGLY AND ILLEGALLY CONFIRMED THE ADDITION OF RS. 58,000/- ON ACCOUNT OF DISALLOWANCE OF COMMISSION PAID ON SALE OF PROPERTY. 5. THAT THE LD. APPELLATE AUTHORITY WRONGLY AND ILLEGALLY CONFIRMED THE REJECTION OF CLAIM OF AGRIC ULTURE INCOME OF RS.3,25,000/- AND CONSEQUENTLY CONFIRMED THE ADDITION IGNORING THE PLEADINGS AND MATERIAL ON REC ORD. 6. THAT THE APPELLANT CRAVES PERMISSION TO ADD, AMEND, ALTER OR DELETE ANY GOA AT THE TIME OF HEARING. 3. GROUND NO.1 IS GENERAL IN NATURE AND DOES NOT REQUIRE ANY SPEC IFIC ADJUDICATION. 4. GROUND NOS. 2 & 3 : THE ASSESSEE THROUGH GROUND NOS. 2 & 3 HAS AGITATED THE ACTION OF THE CIT(A) IN CONFIRMING THE ADDITION OF RS. 5,97,645/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF DISALLOWANCE OF EXPENDITURE CLAIMED BY THE ASSESSEE TO HAVE BEEN IN CURRED ON IMPROVEMENT OF ASSTS. 5. THE BRIEF FACTS RELATING TO THE ISSUE ARE THAT T HE ASSESSEE DECLARED INCOME OF RS. 30,39,900/- AS SHORT TERM CAPITAL GA IN ON SALE OF LAND SITUATED AT LUDHIANA AND CLAIMED DEDUCTION U/S 48 O F THE INCOME-TAX ACT, 1961 (IN SHORT 'THE ACT') IN RESPECT OF THE EXPENDI TURE INCURRED ON THE IMPROVEMENT OF THE ASSETS. THE ASSESSEE CLAIMED THA T EARTH FILLING AND LEVELLING IN THE PLOT WAS DONE, BECAUSE OF WHICH TH E ASSESSEE COULD FETCH A GOOD PRICE ON THE SALE OF THE PLOT. HOWEVER, THE AS SESSING OFFICER DISALLOWED THE ABOVE EXPENDITURE OBSERVING THAT THE ASSESSEE COULD NOT ITA NO. 672/CHD/2018- SMT. MADHU GUPTA, SANGRUR 3 PRODUCE DOCUMENTARY EVIDENCE I.E. NAME AND ADDRESSE S OF THE PARTIES TO WHOM THESE CHARGES FOR EARTH FILLING AND LEVELLIN G OF THE PLOT WAS MADE. 6. IN APPEAL, THE LD. CIT(A) CONFIRMED THE FINDING S OF THE ASSESSING OFFICER ON THIS ISSUE OBSERVING THAT THE ASSESSEE HAS TAKEN A GENERAL GROUND REGARDING DISALLOWANCE OF EXPENDITURE ON IMPROVEME NT OF ASSETS AND HAS NOT SPECIFICALLY TAKEN THE GROUND OF DISALLOWANCE O F EXPENDITURE ON EARTH FILLING AND LEVELLING OF THE PLOT. 7. BEING AGGRIEVED BY THE ABOVE ORDER OF THE LD. CI T(A), THE ASSESSEE HAS COME IN APPEAL BEFORE US. 8. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND HAV E ALSO GONE THROUGH THE RECORDS. A PERUSAL OF THE IMPUGNED ORDER OF THE ASSESSING OFFICER AS WELL AS ORDER OF THE LD. CIT(A) REVEAL BEYOND DOUB T THAT THE ASSESSEE HAS SPECIFICALLY CLAIMED EARTH FILLING AND LEVELING EXP ENDITURE OF RS. 5,97,465/- AS COST OF IMPROVEMENT OF ASSET. NO OT HER EXPENDITURE TOWARDS COST OF IMPROVEMENT OF ASSETS HAS BEEN CLAIMED. HEN CE, THE FINDINGS OF THE CIT(A) THAT THE ASSESSEE HAS NOT SPECIFICALLY TAK EN THIS GROUND BEFORE HIM IS WRONG AND ILLEGAL AS THE ASSESSEE VIDE GROUND NO .2 BEFORE THE CIT(A) HAS SPECIFICALLY TAKEN THE GROUND OF DISALLOWANCE O F EXPENDITURE ON IMPROVEMENT OF ASSETS. 9. THE ASSESSEE BEFORE THE CIT(A) HAS SUBMITTED THA T THE EARTH FILLING AND LEVELLING WAS REQUIRED TO BE DONE AS THE PLOT W AS DEEP AND BECAUSE OF THE EARTH FILLING, THE ASSESSEE WAS ABLE TO GET GO OD PRICE OF THE PLOT. THAT THE ASSESSEE HAD APPOINTED ONE WORK ATTENDANT NAMEL Y SHRI AMAN JAIN TO LOOK AFTER THE WORK OF EARTH FILLING IN THE PLOT. S HRI AMAN JAIN HAS GIVEN DETAILS OF DAY TO DAY EXPENDITURE AND HAS DULY VERI FIED THE SAME. THE ITA NO. 672/CHD/2018- SMT. MADHU GUPTA, SANGRUR 4 COPIES OF THE DATE-WISE DETAILS OF EXPENDITURE HAVE BEEN PLACED AT PAGES 1 TO 12 OF THE PAPER BOOK. THE ASSESSEE HAS ALSO PROV IDED THE REGISTRATION NUMBER OF THE TRACTOR TROLLEY / VEHICLES THROUGH WH ICH THE WORK OF EARTH FILLING WAS GOT DONE. IT HAS ALSO BEEN EXPLAINED TH AT THE WORK OF EARTH FILLING IS GENERALLY PERFORMED BY CAUSAL LABOUR / T RANSPORTER AND NO SPECIFIC BILLS ARE ISSUED IN THIS RESPECT. 10. CONSIDERING THE ABOVE SUBMISSIONS OF THE ASSESS EE AND ALSO AFTER GOING THROUGH THE EVIDENCES FURNISHED BY THE ASSES SEE, WE ARE OF THE VIEW, THAT THE ASSESSEE HAS FURNISHED NECESSARY DETAILS INCLUDING DATE WISE EXPENDITURE ALONG WITH DETAIL OF THE TRACTOR - TRO LLEY NUMBERS ALONGWITH THE AMOUNT PAID, WHICH HAVE BEEN DULY VERIFIED BY S HRI AMAN JAIN, WORK ATTENDANT. IN VIEW OF THE ABOVE, WE DO NOT FIND ANY JUSTIFICAT ION ON THE PART OF THE LOWER AUTHORITIES IN MAKING THE AFORESAID DISAL LOWANCE. THIS DISALLOWANCE MADE BY THE LOWER AUTHORITIES IS ORDER ED TO BE DELETED. 11. GROUND NO.4 : VIDE GROUND NO.4, THE ASSESSEE HAS AGITATED THE ACTION OF THE LOWER AUTHORITIES IN MAKING THE ADDIT ION OF RS. 58,000/- CLAIMED ON ACCOUNT OF COMMISSION PAID FOR FACILITAT ING THE SALE OF PROPERTY. THE ASSESSEE HAS SPECIFICALLY NAMED THE P ERSON SHRI HARBHAJAN SINGH GILL TO WHOM THE AFORESAID COMMISSION OF RS. 58,000/- WAS PAID. HOWEVER, THE ASSESSING OFFICER DISALLOWED THE CLA IM ON THE GROUND THAT THE ASSESSEE HAS NOT PRODUCED THE CONFIRMATION FRO M THE AFORESAID PERSON. HOWEVER, THE PLEA OF THE ASSESSEE IS THAT IT IS A F ACT OF COMMON KNOWLEDGE THAT THE PURCHASE AND SALE OF PROPERTIES ARE GENERA LLY DONE THROUGH BROKERS FOR WHICH A NOMINAL COMMISSION IS REQUIRED TO BE PA ID. THAT A NOMINAL ITA NO. 672/CHD/2018- SMT. MADHU GUPTA, SANGRUR 5 COMMISSION OF RS. 58,000/- WAS PAID TO SHRI HARBHAJ AN SINGH GILL OF LUDHIANA 12. CONSIDERING THE SMALLNESS OF THE COMMISSION AMO UNT AND ALSO THE MARKET TREND THAT THE BROKERS DO PLAY A PART IN FAC ILITATING THE SALE / PURCHASE OF THE PROPERTY AND THE FACT THAT THE ASSE SSEE HAS SPECIFICALLY GIVEN THE NAME AND ADDRESSES OF THE PERSON TO WHOM COMMISSION WAS PAID, WE DO NOT FIND ANY REASON TO SUSPECT THE AFORESAID PAYMENT OF COMMISSION ON THE PART OF THE LOWER AUTHORITIES. 13. IN VIEW OF THE ABOVE, THIS GROUND OF APPEAL IS ALLOWED AND THE ADDITION MADE ON THIS ISSUE IS ORDERED TO BE DELETE D. 14. GROUND NO.5 : VIDE GROUND NO. 5 THE ASSESSEE HAD CONTESTED THE ACTION OF THE LOWER AUTHORITIES IN REJECTING THE CL AIM OF AGRICULTURE INCOME OF RS. 3,25,000/- AND CONSEQUENTLY MAKING THE ADDIT ION OF THE AFORESAID AMOUNT INTO THE TAXABLE INCOME OF THE ASSESSEE. 15. THE LOWER AUTHORITIES REJECTED THE AFORESAID CL AIM ON THE GROUND THAT THE ASSESSEE HAD NOT PRODUCED THE RELIABLE DOCUMENT ARY EVIDENCE IN THE SHAPE OF J FORM ETC. TO PROVE THAT THE ASSESSEE H AD SOLD ANY AGRICULTURAL PRODUCE FROM THE AGRICULTURAL LAND IN QUESTION. 16. BEFORE US, THE LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT THE ASSESSEE OWNS SUFFICIENT AGRICULTURAL LAND, IS NOT DISPUTED. THE ASSESSEE HAS PRODUCED ON FILE THE COPIES OF THE LEASE AGREEM ENT, WHEREBY, THE ASSESSEE HAS GIVEN AGRICULTURAL LAND ON LEASE FOR P ERFORMING OF AGRICULTURAL OPERATIONS. THE ASSESSEE IN THIS RESPECT HAS RELIED UPON THE AGREEMENT EXECUTED BETWEEN THE ASSESSEE AND ONE SHRI LABH SIN GH, WHEREBY, THE AFORESAID SHRI LABH SINGH HAS TAKEN 04 ACRES OF LAN D OF THE ASSESSEE ON ITA NO. 672/CHD/2018- SMT. MADHU GUPTA, SANGRUR 6 LEASE / BATAI AND HAD AGREED TO PAY A SUM OF RS. 1,92,000/- FOR THE YEAR 2012-13. IT IS ALSO PROVIDED IN THE AGREEMENT THAT THE LAND IS AN IRRIGATED LAND WITH ELECTRIC MOTOR AND BORE. THE ASSESSEE HAS FURTHER PRODUCED ON THE FILE AN AGREEMENT WITH ONE SHRI CHAMKAUR SINGH S/O SH. LABH SINGH, WHEREBY, THE ASSESSEE HAS SOLD THE STANDING TREES O N HIS LAND FOR A LUMP SUM AMOUNT OF RS. 1,37,500/- . THE OWNERSHIP OF THE AGRICULTURAL LAND OF THE ASSESSEE HAS NOT BEEN DISPUTED BY THE LOWER AUT HORITIES. IT IS THE CASE OF THE ASSESSEE THAT SHE HERSELF DID NOT CARRY THE AGR ICULTURAL OPERATION BUT SHE HAD GIVEN HER LAND ON LEASE / BATAI AND FURTHER S TANDING TREES ON THE OTHER PART OF THE LAND WERE SOLD DURING THE YEAR. THE NAM ES AND ADDRESSES OF THE PERSONS WITH WHOM THE AFORESAID CONTRACT OF LEASE / BATAI AND SALE OF STANDING TREES HAS ALSO BEEN DULY MENTIONED IN THE COPIES OF THE AGREEMENT PRODUCED ON THE FILE. 17. IN VIEW OF THIS, WE DO NOT FIND ANY JUSTIFICATI ON ON THE PART OF THE LOWER AUTHORITIES IN MAKING THE IMPUGNED DISALLOWAN CE. THE ADDITION MADE ON THIS ISSUE IS ALSO HEREBY ORDERED TO THE DELETED . 18. GROUND NO.6 IS GENERAL IN NATURE AND DOES NOT REQUIRE ANY SPEC IFIC ADJUDICATION. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS HEREBY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 29.01.2019 SD/- SD/- ( $ % & '# / ANNAPURNA GUPTA) () / ACCOUNTANT MEMBER ( / SANJAY GARG) / JUDICIAL MEMBER DATED : 29.01.2019 .. ITA NO. 672/CHD/2018- SMT. MADHU GUPTA, SANGRUR 7 '+ ,- .- / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. # / / CIT 4. # / ( )/ THE CIT(A) 5. -01 2 , % 2 , 34516 / DR, ITAT, CHANDIGARH 6. 15 7$ / GUARD FILE '+ # / BY ORDER, 8 ' / ASSISTANT REGISTRAR