DCIT, Coimbatore V. C.L.Aswin, Coimbatore

ITA 707/CHNY/2017

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 5228 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-04-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 12-04-2018
• Assessment Year: 2007-2008
• Appeal Filed On: 22-03-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: K RAGHU
• Keywords: Capital asset
• Section: 147; 148; 263; 132

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, CHENNAI . . . , . !' , $ % BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ./ ITA NO.707/CHNY/2017 ' (' / ASSESSMENT YEAR : 2007-08 THE DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE I, AAYAKAR BHAVAN, 63, RACE COURSE ROAD, COIMBATORE 641 018. V. SHRI C.L. ASWIN, NEW NO.12, OLD NO.65, SYRIAN CHURCH ROAD NO.3, COIMBATORE 641 001. PAN : ACLPA 5362 L (*+/ APPELLANT) (,-*+/ RESPONDENT) *+ . / / APPELLANT BY : SHRI AR.V. SREENIVASAN, JCIT ,-*+ . / / RESPONDENT BY : SHRI K. RAGHU, CA 0 . 1$ / DATE OF HEARING : 12.04.2018 2!( . 1$ / DATE OF PRONOUNCEMENT : 19.04.2018 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER: THIS APPEAL OF THE REVENUE IS DIRECTED AGAINST T HE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) -18, CHENNAI, DATED 20.12.2016 AND PERTAINS TO ASSESSMENT YEAR 2007-08. 2. THERE WAS A DELAY OF 2 DAYS IN FILING THIS APPEA L BY THE REVENUE. THE REVENUE HAS FILED A PETITION FOR CONDONATION OF DELAY. WE HAVE 2 I.T.A. NO.707/CHNY/17 HEARD THE LD. D.R. AND THE LD. REPRESENTATIVE FOR T HE ASSESSEE. WE FIND THAT THERE WAS SUFFICIENT CAUSE FOR NOT FILING THE APPEAL BEFORE THE STIPULATED TIME. THEREFORE, WE CONDONE THE DELAY A ND ADMIT THE APPEAL. 3. SHRI AR.V. SREENIVASAN, THE LD. DEPARTMENTAL REP RESENTATIVE, SUBMITTED THAT THE ASSESSEE CLAIMED EXEMPTION ON TH E PROFIT OF SALE OF LANDED PROPERTY. HOWEVER, THE ASSESSING OFFICER FO UND THAT THERE WAS SHORT TERM CAPITAL GAIN ON THE SALE OF LAND AND ASS ESSED ACCORDINGLY. ON APPEAL BY THE ASSESSEE, ACCORDING TO THE LD. D.R., THE CIT(APPEALS) FOUND THAT THE PROPERTY WAS SITUATED BEYOND 8 KMS R ADIUS FROM THE OUTER LIMIT OF COIMBATORE MUNICIPAL CORPORATION. ACCORDI NGLY, HE DELETED THE ADDITION HOLDING THAT THE LAND IN QUESTION IS NOT A CAPITAL ASSET. ON FURTHER APPEAL BY THE REVENUE BEFORE THIS TRIBUNAL, ACCORDING TO THE LD. D.R., IT WAS FOUND THAT THE LAND IN QUESTION IS AN AGRICULTURAL LAND. ACCORDINGLY, THE ORDER OF THE CIT(APPEALS) WAS CONF IRMED. ACCORDING TO THE LD. D.R., SUBSEQUENTLY, THE ADMINISTRATIVE COMM ISSIONER INITIATED PROCEEDING UNDER SECTION 263 OF THE INCOME-TAX ACT, 1961 (IN SHORT 'THE ACT') HOLDING THAT THE PROFIT RECEIVED ON SALE OF A GRICULTURAL LAND WAS INCOME FROM BUSINESS. ACCORDING TO THE LD. D.R., T HE ASSESSEE CHALLENGED THE ORDER OF THE ADMINISTRATIVE COMMISSI ONER PASSED UNDER SECTION 263 OF THE ACT BEFORE THIS TRIBUNAL. THIS TRIBUNAL FOUND THAT THE ISSUE TAKEN IN THE PROCEEDING BY THE ADMINISTRATIVE COMMISSIONER UNDER SECTION 263 OF THE ACT WAS ALREADY ADJUDICATED BY T WO APPELLATE 3 I.T.A. NO.707/CHNY/17 AUTHORITIES INCLUDING THIS TRIBUNAL HOLDING THAT TH E LAND IN QUESTION IS AGRICULTURAL LAND AND THEREFORE, EXEMPTED FROM TAXA TION. ACCORDINGLY, AS PER THE LD. D.R., THE ORDER OF THE ADMINISTRATIVE C OMMISSIONER WAS FOUND TO BE BAD IN LAW. 4. THE LD. DEPARTMENTAL REPRESENTATIVE FURTHER SUBM ITTED THAT SUBSEQUENTLY THERE WAS SEARCH PROCEEDING UNDER SECT ION 132 OF THE ACT IN THE RESIDENTIAL PREMISES OF THE ASSESSEE AT COIM BATORE ON 27.11.2013. DURING THE COURSE OF SEARCH PROCEEDING, ACCORDING T O THE LD. D.R., SOME INCRIMINATING MATERIAL, INCLUDING TITLE DEEDS, LEDG ER ACCOUNT OF SHRI KRISHNA KUMAR, ETC WERE FOUND. ON THE BASIS OF MAT ERIAL FOUND DURING THE COURSE OF SEARCH OPERATION, ACCORDING TO THE LD . D.R., THE ASSESSING OFFICER FOUND THAT DOMINANT INTENTION OF THE ASSESS EE WAS TO MAKE PROFIT FROM REAL ESTATE. ACCORDINGLY, HE REOPENED THE ASS ESSMENT BY ISSUING NOTICE UNDER SECTION 148 OF THE ACT AND THE PROFIT ON SALE OF LAND WAS ASSESSED AS INCOME FROM BUSINESS. ACCORDING TO THE LD. D.R., THE ASSESSMENT WAS REOPENED ON THE BASIS OF THE MATERIA L FOUND DURING THE COURSE OF SEARCH OPERATION, THEREFORE, THE CIT(APPE ALS) IS NOT JUSTIFIED IN QUASHING THE ASSESSMENT ORDER PASSED BY THE ASSESSI NG OFFICER. 5. WE HEARD SHRI K. RAGHU, THE LD. REPRESENTATIVE F OR THE ASSESSEE ALSO. ADMITTEDLY, THE ASSESSING OFFICER INITIALLY REJECTED THE CLAIM OF THE ASSESSEE AND HELD THAT THE LAND IN QUESTION IS NOT AN AGRICULTURAL LAND 4 I.T.A. NO.707/CHNY/17 AND IT WAS SITUATED WITHIN THE 8 KMS RADIUS OF COIM BATORE MUNICIPALITY, THEREFORE, IT IS A CAPITAL ASSET. ACCORDINGLY, HE ASSESSED THE PROFIT ON SALE OF LAND AS SHORT TERM CAPITAL GAIN. ON FURTHE R APPEAL BY THE ASSESSEE BEFORE THE CIT(APPEALS), IT WAS FOUND THAT THE LAND IN QUESTION WAS SITUATED BEYOND 8 KMS RADIUS FROM THE MUNICIPAL LIMIT OF COIMBATORE MUNICIPAL CORPORATION. ACCORDINGLY, THE CIT(APPEAL S) FOUND THAT THE LAND IN QUESTION IS AN AGRICULTURAL LAND. THIS ORDER OF THE CIT(APPEALS) WAS CONFIRMED BY THIS TRIBUNAL ON THE APPEAL FILED BY T HE REVENUE. SUBSEQUENTLY, THE ADMINISTRATIVE COMMISSIONER REOPE NED THE ASSESSMENT HOLDING THAT THE PROFIT ON SALE OF SUCH LAND WAS TO BE ASSESSED AS BUSINESS PROFIT. THIS ORDER OF THE ADM INISTRATIVE COMMISSIONER WAS ALSO SET ASIDE BY THIS TRIBUNAL HO LDING THAT THE ADMINISTRATIVE COMMISSIONER CANNOT REVISE THE ORDER OF THE ASSESSING OFFICER SUBSEQUENT TO THE ORDER PASSED BY THE TRIBU NAL CONFIRMING THE ORDER OF THE CIT(APPEALS). 6. NOW, THE ASSESSING OFFICER ON THE BASIS OF THE M ATERIAL SAID TO BE FOUND DURING THE COURSE OF SEARCH OPERATION, AGAIN REOPENED THE ASSESSMENT UNDER SECTION 147 OF THE ACT AND ASSESSE D THE PROFIT AS BUSINESS PROFIT. THIS TRIBUNAL IS OF THE CONSIDERE D OPINION THAT WHEN THE ISSUE OF ASSESSMENT OF PROFIT ON SALE OF LAND WAS C ONCLUDED BY THE ORDER OF THIS TRIBUNAL IN TWO ROUNDS OF LITIGATION, THE A SSESSING OFFICER IS NOT JUSTIFIED IN AGAIN REOPENING THE ASSESSMENT UNDER S ECTION 147 OF THE ACT. 5 I.T.A. NO.707/CHNY/17 IF AT ALL THERE IS ANY MATERIAL FOUND DURING THE CO URSE OF SEARCH OPERATION, THAT MAY BE A BASIS FOR CHALLENGING THE ORDER OF TH IS TRIBUNAL BEFORE THE HIGHER FORUMS AS PER THE PROCEDURE PROVIDED UNDER T HE LAW. THE ASSESSING OFFICER IS NOT EXPECTED TO TAKE THE LAW I N HIS OWN HANDS AND REOPEN THE ASSESSMENT BY ISSUING NOTICE UNDER SECTI ON 148 OF THE ACT AFTER THE ASSESSMENT ORDER WAS MERGED WITH THE ORDE R OF THIS TRIBUNAL. THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT WHE N THE ASSESSMENT ORDER WAS MERGED WITH THE ORDER OF THIS TRIBUNAL, T HE ASSESSING OFFICER CANNOT REOPEN THE ASSESSMENT MERELY BECAUSE THERE W AS SOME MATERIAL FOUND DURING THE COURSE OF SEARCH OPERATION IN RESP ECT OF THE VERY SAME ISSUE. THEREFORE, THE CIT(APPEALS) HAS RIGHTLY QUA SHED THE ORDER OF THE ASSESSING OFFICER. THIS TRIBUNAL DO NOT FIND ANY R EASON TO INTERFERE WITH THE ORDER OF THE LOWER AUTHORITY AND ACCORDINGLY TH E SAME IS CONFIRMED. 7. IN THE RESULT, THE APPEAL FILED BY THE REVENUE S TANDS DISMISSED. ORDER PRONOUNCED ON 19 TH APRIL, 2018 AT CHENNAI. SD/- SD/- (. !' ) ( . . . ) (A. MOHAN ALANKAMONY) (N.R.S. GANESAN) $ / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 4 /DATED, THE 19 TH APRIL, 2018. KRI. 6 I.T.A. NO.707/CHNY/17 . ,156 76(1 /COPY TO: 1. *+ /APPELLANT 2. ,-*+ /RESPONDENT 3. 0 81 () /CIT(A)-18, CHENNAI-34 4. PRINCIPAL CIT, CENTRAL-2, CHENNAI. 5. 69 ,1 /DR 6. :' ; /GF.