Mamta Anchalia, Kolkata V. DCIT, Circle-32, Kolkata, Kolkata

ITA 678/KOL/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 1582 (ITAT-KOLKATA)
• Duration Of Justice: 9 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-01-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2013-2014
• Appeal Filed On: 07-04-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Gift; Cost of acquisition
• Section: 143(3); 54F

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH (A), KOLKATA [BEFORE SHRI P.M. JAGTAP, AM & SHRI ABY. T. VARKEY, JM] I.T.A. NO. 678/KOL/2017 ASSESSMENT YEAR: 2013-14 MAMTA ANCHALIA...............................................................APPELLANT 31B, JHOWTALA ROAD, KOLKATA 700 017 [PAN: ACPPJ 5431 M] D.C.I.T., CIR 32, KOLKATA....................RESPONDENT 10B, MIDDLETON ROW, KOLKATA 700 071 APPEARANCES BY: SHRI SUNIL SURANA, FCA APPEARING ON BEHALF OF THE ASSESSEE. SHRI PINAKI MUKHERJEE, ADDL. CIT APPEARING ON BEHALF OF THE REVENUE. DATE OF CONCLUDING THE HEARING : DECEMBER 20, 2017 DATE OF PRONOUNCING THE ORDER : JANUARY 31, 2018 ORDER PER P.M. JAGTAP, A.M. THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF LD. CIT(APPEALS) 9, KOLKATA DATED 29.03.2017 AND THE ONLY ISSUE INVOLVED THEREIN RELATES TO THE DISALLOWANCE MADE BY THE A.O. AND CONFIRMED BY THE LD. CIT(A) ON ACCOUNT OF ASSESSEES CLAIM FOR EXEMPTION UNDER SECTION 54F OF THE INCOME TAX ACT, 1961. 2. THE ASSESSEE IN THE PRESENT CASE IS AN INDIVIDUAL WHO FILED HER RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION ON 31.03.2013 DECLARING A TOTAL INCOME OF RS. 8,20,140/-. IN THE SAID RETURN, LONG TERM CAPITAL GAIN ARISING FROM THE SALE OF SILVER UTENSILS WAS SHOWN BY THE ASSESSEE AT RS. 8,03,397/- AND EXEMPTION U/S 54F WAS CLAIMED ON ACCOUNT OF INVESTMENT MADE IN PURCHASE OF ONE RESIDENTIAL HOUSE TO THE TUNE OF RS. 27,20,759/-. IT WAS EXPLAINED BY THE ASSESSEE IN THIS 2 I.T.A. NO. 678/KOL/2017 ASSESSMENT YEAR: 2013-14 MAMTA ANCHALIA REGARD BEFORE THE ASSESSING OFFICER DURING THE COURSE OF ASSESSMENT PROCEEDINGS THAT SHE HAD RECEIVED THE SILVER UTENSILS WEIGHING 25.210 KGS. AS GIFT FROM SHRI BIJAY KARAN ANCHALIA (HUF) AND THE SAME WERE SOLD DURING THE YEAR UNDER CONSIDERATION TO M/S. BHATTER SILVER (P) LTD. FOR A CONSIDERATION OF RS 13,86,550/-. AFTER DEDUCTING THE INDEXED COST OF ACQUISITION OF THE SILVER UTENSILS AMOUNTING TO RS. 5,83,153/- FROM THE SAID SALE CONSIDERATION, LONG TERM CAPITAL GAIN OF RS. 8,03,397/- WAS WORKED OUT WHICH WAS CLAIMED TO BE EXEMPT UNDER SECTION 54F ON ACCOUNT OF INVESTMENT MADE IN PURCHASE OF ONE RESIDENTIAL HOUSE PROPERTY AT RS. 27,20,759/-. THE A.O., HOWEVER NOTED FROM THE BALANCE SHEET OF THE ASSESSEE THAT SHE WAS ALREADY POSSESSING SEVERAL PROPERTIES INCLUDING SOME LAND AND BUILDINGS. HE ALSO OBSERVED THAT THERE WAS A FAILURE OF THE ASSESSEE TO FURNISH EVEN THE DETAILS OF INVESTMENT CLAIMED TO BE MADE IN THE NEW HOUSE PROPERTY DURING THE YEAR UNDER CONSIDERATION FOR CLAIMING EXEMPTION UNDER SECTION 54F. HE ACCORDINGLY DISALLOWED THE CLAIM OF THE ASSESSEE FOR EXEMPTION UNDER SECTION 54F AND MADE AN ADDITION OF RS. 27,20,759/- TO THE TOTAL INCOME OF THE ASSESSEE IN THE ASSESSMENT COMPLETED UNDER SECTION 143(3) VIDE AN ORDER DATED 28.03.2016. 3. AGAINST THE ORDER PASSED BY THE A.O. UNDER SECTION 143(3), AN APPEAL WAS FILED BY THE ASSESSEE BEFORE THE LD. CIT(A) CHALLENGING INTER ALIA THE DISALLOWANCE MADE BY THE A.O. ON ACCOUNT OF HER CLAIM FOR EXEMPTION UNDER SECTION 54F. DURING THE COURSE OF APPELLATE PROCEEDINGS BEFORE THE LD. CIT(A), IT WAS SUBMITTED BY THE ASSESSEE THAT THE LONG TERM CAPITAL GAIN EARNED BY THE ASSESSEE AND CLAIMED AS EXEMPT UNDER SECTION 54F WAS ONLY TO THE TUNE OF RS 8,03,397/- AND 3 I.T.A. NO. 678/KOL/2017 ASSESSMENT YEAR: 2013-14 MAMTA ANCHALIA THEREFORE, THE A.O. WAS NOT JUSTIFIED IN MAKING THE ADDITION OF RS. 27,20,759/- ON ACCOUNT OF DISALLOWANCE OF CLAIM UNDER SECTION 54F. IT WAS ALSO CONTENDED BY THE ASSESSEE BEFORE THE LD. CIT(A) THAT EVEN THOUGH THE ASSESSEE HAD POSSESSED SEVERAL PROPERTIES AS REFLECTED IN HER BALANCE SHEET, THEY WERE COMMERCIAL IN NATURE AND THE ASSESSEE DID NOT OWN ANY RESIDENTIAL HOUSE PROPERTY ON THE DATE OF SALE OF SILVER UTENSILS. IT WAS CONTENDED THAT THE ASSESSEE THUS WAS ENTITLED FOR EXEMPTION UNDER SECTION 54F AND THE A.O. WAS NOT JUSTIFIED IN DISALLOWING THE SAID EXEMPTION. THE LD. CIT(A) DID NOT FIND MERIT IN THIS CONTENTION RAISED ON BEHALF OF THE ASSESSEE AND PROCEEDED TO CONFIRM THE DISALLOWANCE MADE BY THE A.O. ON ACCOUNT OF ASSESSEES CLAIM FOR EXEMPTION UNDER SECTION 54F. AGGRIEVED BY THE SAME, THE ASSESSEE HAS PREFERRED THIS APPEAL BEFORE THE TRIBUNAL. 4. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AND ALSO PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. THE LEARNED COUNSEL FOR THE ASSESSEE AT THE OUTSET HAS INVITED OUR ATTENTION TO THE COPY OF ASSESSEES BALANCE SHEET AS ON 31.03.2013 PLACED AT PAGE NO 15 OF THE PAPER BOOK TO POINT OUT THAT THE PROPERTIES REFLECTED THEREIN WERE ALL COMMERCIAL PROPERTIES. HE HAS CONTENDED THAT THE ONLY RESIDENTIAL PROPERTY REFLECTED IN THE SAID BALANCE SHEET WAS THE ONE WHICH THE ASSESSEE HAD PURCHASED DURING THE YEAR UNDER CONSIDERATION AND CLAIMED EXEMPTION UNDER SECTION 54F IN RESPECT OF THE SAME. HE HAS CONTENDED THAT THE ASSESSEE THUS WAS NOT OWNING ANY RESIDENTIAL PROPERTY ON THE DATE OF SALE OF SILVER UTENSILS AND IT WAS FULLY ENTITLED FOR EXEMPTION UNDER SECTION 54F AS CLAIMED. HE HAS ALSO CONTENDED THAT THE LONG TERM CAPITAL GAIN THAT HAD ARISEN TO THE 4 I.T.A. NO. 678/KOL/2017 ASSESSMENT YEAR: 2013-14 MAMTA ANCHALIA ASSESSEE ON TRANSFER OF SILVER UTENSILS IN RESPECT OF WHICH EXEMPTION UNDER SECTION 54F WAS CLAIMED WAS ONLY RS. 8,03,397/- AND THE A.O. WAS WRONG IN MAKING ADDITION OF RS. 27,20,759/- ON ACCOUNT OF DISALLOWANCE UNDER SECTION 54F. 5. THE LEARNED DR, ON THE OTHER HAND, HAS CONTENDED THAT THERE IS NOTHING BROUGHT ON RECORD BY THE ASSESSEE TO SHOW THAT PROPERTIES REFLECTED IN HER BALANCE SHEET WERE ALL COMMERCIAL PROPERTIES. HE HAS CONTENDED THAT THE CLAIM MADE BY THE LEARNED COUNSEL FOR THE ASSESSEE THAT THE SAID PROPERTIES ARE COMMERCIAL PROPERTIES AND NOT RESIDENTIAL REQUIRES VERIFICATION BY THE A.O. AND THE MATTER THEREFORE, MAY BE SENT BACK TO THE A.O. FOR SUCH VERIFICATION AS WELL AS THE VERIFICATION OF THE EXACT QUANTUM OF DISALLOWANCE, IF ANY, TO BE MADE UNDER SECTION 54F. WE FIND MERIT IN THIS CONTENTION OF THE LEARNED DR AND SINCE THE LEARNED COUNSEL FOR THE ASSESSEE HAS ALSO NOT RAISED ANY OBJECTION IN THIS REGARD, WE SET ASIDE THE IMPUGNED ORDER OF THE LD. CIT(A) ON THIS ISSUE AND RESTORE THE MATTER TO THE FILE OF THE A.O. FOR DECIDING THE SAME AFRESH AFTER GIVING THE ASSESSEE AN OPPORTUNITY TO SUPPORT AND SUBSTANTIATE HER CLAIM THAT THE PROPERTIES REFLECTED IN HER BALANCE SHEET AT THE RELEVANT TIME WERE COMMERCIAL PROPERTIES AND NOT RESIDENTIAL. THE A.O. SHALL ALSO TAKE INTO CONSIDERATION THE EXACT AMOUNT OF EXEMPTION CLAIMED BY THE ASSESSEE UNDER SECTION 54F AND IF THE CLAIM OF THE ASSESSEE FOR THE SAME IS NOT FOUND TO BE ALLOWABLE, HE SHALL MAKE THE ADDITION ONLY TO THE EXTENT OF EXEMPTION ACTUALLY CLAIMED BY THE ASSESSEE UNDER SECTION 54F. 5 I.T.A. NO. 678/KOL/2017 ASSESSMENT YEAR: 2013-14 MAMTA ANCHALIA 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 31 ST JANUARY, 2018. SD/- SD/- (ABY.T. VARKEY) (P.M. JAGTAP) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 31/01/2018 BISWAJIT, SR. PS COPY OF ORDER FORWARDED TO: 1. MAMTA ANCHALIA, 31B, JHOWTALA ROAD, KOLKATA 700 017. 2. DCIT, CIR-32, 10B, MIDDLETON ROW, KOLKATA 700 071. 3. THE CIT(A) 4. THE CIT 5. DR TRUE COPY, BY ORDER, SR. P.S. / H.O.O. ITAT, KOLKATA