ITO, New Delhi V. Sh Madhusudan Lal Nanda, Noida

ITA 7/DEL/2010

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 8060 (ITAT-DELHI)
• Duration Of Justice: 2 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-03-2010
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Assessment Year: 1997-1998
• Appeal Filed On: 01-01-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PRATIMA KAUSHIK
• Assessee Lawyers: MADHUSUDAN LAL NANDA
• Section: 143(3); 54

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH E: NEW DELHI BEFORE SHRI C.L. SETHI, JUDICIAL MEMBER & SHRI K.D. RANJAN, ACCOUNTANT MEMBER ITA NO. 7/DEL/2010 ASSESSMENT YEAR : 1997-98 INCOME TAX OFFICER WARD 30(1), ROOM NO. 111, DRUM SHAPED BUILDING, NEW DELHI VS. SH. MADHUSUDAN LAL NANDA PROP. M/S. WAZIR CHAND NANDA & CO., D-110, SECTOR 26, NOIDA (U.P.) (APPELLANT) (RESPONDENT) APPELLANT BY : MS. PRATIMA KAU SHIK, SR. DR RESPONDENT BY : SH. MADHUSUDAN LAL NANDA O R D E R PER: C.L. SETHI, J.M. THE REVENUE IS IN APPEAL AGAINST THE ORDER DATED 2 1.10.2009 PASSED BY THE LD. CIT(A) IN THE MATTER OF AN ASSESSMENT U/ S. 143(3) OF THE INCOME TAX ACT, 1961 (THE ACT) MADE BY THE AO FOR THE A. Y. 1997-98. 2. THE ONLY GROUND RAISED BY THE REVENUE IS AS UNDE R: IN THE FACTS AND THE CIRCUMSTANCES OF THE CASE, TH E LD. CIT(A) HAS ERRED IN ALLOWING EXEMPTION UNDER SECTION 54 OF THE I.T. ACT, AS DEDUCTION U/S. 54 IS LIMITED TO ONE HOUSE ONLY. 3. WE HAVE HEARD BOTH THE PARTIES. 4. IN THIS CASE, THE ASSESSMENT WAS ORIGINALLY MADE ON 28.08.2000 U/S. 143(3), AGAINST WHICH THE ASSESSEE PREFERRED AN APP EAL BEFORE THE CIT(A). THIS APPEAL BEFORE THE CIT(A) WAS INSTITUTED ON 10. 03.2000 AND WAS ITA NO. 7/DEL/2010 PAGE 2 OF 5 REGISTERED AS APPEAL NO. 55/1999-2000 IN THE OFFICE OF THE LD. CIT(A). THE LD. CIT(A) DISPOSED OFF THIS APPEAL VIDE HIS OR DER DATED 06.11.2002. THE ISSUE WITH REGARD TO THE ASSESSEES CLAIM OF DE DUCTION U/S. 54 HAS BEEN DECIDED BY THE LD. CIT(A) VIDE PARA 5 OF HIS ORDER DATED 06.11.2002, WHICH READS AS UNDER:- 5. HOWEVER, THE ASSESSEE IS ENTITLED TO THE EXEMPTION U/S. 54 IN COMPUTING THE CAPITAL GAIN FRO M THE DALE OF HOUSE NO. 302, GK II, NEW DELHI. (THE 1/ 5 TH SHARE IN HOUSE NO. 14/56, PUNJABI BAGH, NEW DELHI W AS SOLD ON 24.08.1998 AND THEREFORE THE SAID TRANSFER DOES NOT FALL IN THE FINANCIAL YEAR UNDER CONSIDERATION AT ALL). THE GK HOUSE WAS SOLD FOR RS. 76 LACS ON 16.07.1996 AND THE ASSESSEE PURCHASED A NEW HOUSE AT NOIDA ON 29.05.1998 FOR A CONSIDERATION OF RS. 1700000/-. S INCE THE NEW HOUSE WAS PURCHASED WITHIN TWO YEARS OF THE SALE OF THE G.K. HOUSE, THE ASSESSING OFFICER IS DIRECTE D TO COMPUTE AND ALLOW THE EXEMPTION UNDER SECTION 54 AGAINST THE CAPITAL GAIN FROM THE SALE OF THE G.K. HOUSE. 5. AGAINST THE AFORESAID ORDER OF THE CIT(A) DATED 06.11.2002, DEPARTMENT DID NOT PREFER ANY APPEAL BEFORE THE TRI BUNAL. HOWEVER, THE ASSESSEE FILED AN APPEAL AGAINST THE AFORESAID ORDE R DATED 06.11.2002 PASSED BY THE LD. CIT(A) IN RESPECT OF SOME OTHER G ROUNDS, WHICH WERE DECIDED AGAINST THE ASSESSEE. WHILE DECIDING THE A SSESSEES APPEAL NUMBERED AS ITA NO. 4931/DEL/2002, TRIBUNAL IN ITS ORDER DATED 07.12.2005 HAS RESTORED THE MATTER WITH REGARD TO T HE COMPUTATION OF CAPITAL GAIN ON SALE OF STOCK EXCHANGE TICKET AND S OME OTHER ISSUES, BACK TO THE CIT(A) FOR HIS FRESH ADJUDICATION. WHILE RE STORING THE VARIOUS ISSUES BACK TO THE CIT(A), THE TRIBUNAL HAS MADE AN OBSERVATION THAT ITA NO. 7/DEL/2010 PAGE 3 OF 5 DEDUCTION ALREADY GRANTED U/S. 54 OF THE ACT TO THE ASSESSEE SHALL NOT BE WITHDRAWN. THE RELEVANT PARA OF THE TRIBUNALS ORD ER DATED 07.12.2005 IS AS UNDER:- 11. IN THE LAST GROUND, THE ASSESSEE CONTENDS THAT INCOME FROM SALE OF STOCK EXCHANGE TICKET WAS NOT LIABLE TO CAPITAL GAINS AND THE SET OFF OF CAPITAL GAIN HAS ALSO NOT BEEN ALLOWED AGAINST OTHER INCOME. SINCE THE MATTER HAS BEEN RESTORED BACK TO THE LEARNED CIT(A) . HE SHALL ALSO EXAMINE THIS CLAIM OF THE ASSESSEE IN ACCORDANCE WITH LAW. HOWEVER, THE DEDUCTION ALREAD Y GRANTED UNDER SECTION 54 OF THE ACT TO THE ASSESSEE SHALL NOT BE WITHDRAWN. 6. IN CONSEQUENCE TO THE ORDER DATED 07.12.2005 PAS SED BY THE TRIBUNAL, THE LD. CIT(A) HAS TAKEN UP CERTAIN ISSUE S AFRESH FOR HIS CONSIDERATION AND PASS THE IMPUGNED ORDER DATED 21. 10.2009. IN THE AFORESAID ORDER DATED 21.10.2009, THE LD. CIT(A) HA S MADE AN OBSERVATION WITH REGARD TO THE ASSESSEES CLAIM OF DEDUCTION U/ S. 54 BY STATING AS UNDER:- 7.7.3 FURTHER, SINCE THE APPELLANT PURCHASED A RESIDENTIAL HOUSE AT NOIDA WITHIN 2 YEA RS FROM THE DATE OF TRANSFER OF THE PROPERTY AT GK I I, DEDUCTION U/S. 54 IS ADMISSIBLE. THIS IS ALSO ALLO WABLE AS PER THE DIRECTION OF THE HONBLE ITAT IN THEIR ORDE R DATED 07.12.2005. 7. IN THE LIGHT OF THE AFORESAID FACTS, THE ASSESSE ES CLAIM OF DEDUCTION U/S. 54 OF THE ACT STOOD ALREADY CONCLUDED VIDE LD. CIT(A)S ORDER DATED 06.11.2002, AND OBSERVATION HAS BEEN MADE BY THE TR IBUNAL IN ITS ORDER TO THAT EFFECT THAT THE DEDUCTION ALREADY GRANTED U/S. 54 TO THE ASSESSEE SHALL ITA NO. 7/DEL/2010 PAGE 4 OF 5 NOT BE WITHDRAWN WHILE ADJUDICATING THE VARIOUS OTH ER ISSUES WHICH WERE RESTORED BACK TO THE FILE OF THE CIT(A) FOR HIS FRE SH ADJUDICATION. THE LD. CIT(A) ALSO IN HIS ORDER DATED 21.10.2009 HAS MENTI ONED THAT THE DEDUCTION U/S. 54 IS ALLOWABLE AS PER THE DIRECTION OF THE HONBLE ITAT IN ITS ORDER DATED 07.12.2005. IT IS, THUS, CLEAR THA T THE ISSUE NOW RAISED BY THE DEPARTMENT STOOD CONCLUDED, AND THIS MATTER CAN NOT BE RAISED NOW BY THE DEPARTMENT IN THIS APPEAL FILED AGAINST THE CIT (A)S FRESH ORDER DATED 21.10.2009 PASSED IN THE SECOND ROUND. WE, THEREFO RE, REJECT THE GROUND RAISED BY THE REVENUE. 8. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED. 9. THIS DECISION HAS ALREADY BEEN PRONOUNCED ON 03. 03.2010 IMMEDIATELY AFTER THE HEARING WAS OVER. SD/- (K.D. RANJAN) ACCOUNTANT MEMBER SD/- (C.L. SETHI) JUDICIAL MEMBER DATED: 03 RD MARCH, 2010 *NITASHA COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT, NEW DELHI. BY ORDER ITA NO. 7/DEL/2010 PAGE 5 OF 5 DEPUTY REGISTRAR