Anil Kumar, New Del;hi V. ITO, Ward-44(4), New Delhi

ITA 7459/DEL/2018

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 7318 (ITAT-DELHI)
• Duration Of Justice: 5 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-04-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2015-2016
• Appeal Filed On: 26-11-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Capital receipt
• Section: 28; 2(14)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH SMC NEW DELHI BEFORE SHRI AMIT SHUKLA, JUDICIAL MEMBER I.T.A. NO.7459/DEL/2018 ASSESSMENT YEAR: 2015-16 ANIL KUMAR, C/O R. KHARE & ASSOCIATES, 7/6 (LFG), SARVA PRIYA VIHAR, NEW DELHI. V. ITO, WARD-44(4), NEW DELHI. TAN/PAN: AKAPK1373N (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI RAHUL KHARE, ADV. RESPONDENT BY: SHRI S.L. ANURAGI, SR.D.R. DATE OF HEARING: 15 04 2019 DATE OF PRONOUNCEMENT: 26 04 2019 O R D E R THE AFORESAID APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE IMPUGNED ORDER DATED 28.08.2018 PASSED BY THE COMMISSIONER OF INCOME TAX (APPEALS)-XV, NEW DELHI FOR THE QUANTUM OF ASSESSMENT PASSED U/S.143(3) FOR THE ASSESSMENT YEAR 2015-16. IN THE GROUNDS OF APPEAL, THE ASSESSEE HAS CHALLENGED THE ORDER OF THE LD. CIT (A ) ON THE GROUND THAT THE SAME HAS BEEN PASSED EX-PARTE AND; SECONDLY INTEREST U/S.28 RECEIVED ON ACCOUNT OF COMPENSATION ON ACQUISITION OF LAND HAS BEEN TREATED AS REVENUE REC EIPT INSTEAD OF CAPITAL RECEIPT. 2. THE FACTS IN BRIEF ARE THAT THE ASSESSEE IS A FA RMER AND HIS LAND WAS ACQUIRED BY THE GOVERNMENT UNDER THE L AND ACQUISITION ACT AND HAS RECEIVED COMPENSATION. HOWE VER, AFTER THE COURTS DIRECTION, ENHANCED COMPENSATION WAS I.T.A. NO.7459/DEL/2018 2 AWARDED AMOUNTING TO RS.76,11,500/- U/S. 28 OF THE LAND ACQUISITION ACT. THE LD. ASSESSING OFFICER HAS TREA TED THE SAID AMOUNT AS INTEREST AND HAS TAXED THE SAME AFTER INV OKING THE PROVISION OF SECTION 57(IV) AND HAS DISALLOWED 50% OF THE AMOUNT, I.E. RS.38,05,750/-. 3. LD. CIT (A) HAS PASSED THE EX PARTE ORDER STATING THAT NOTICE WAS SENT ON THE ADDRESS MENTIONED IN FORM NO .35 AND NO COMPLIANCE HAS BEEN MADE BY THE ASSESSEE. 4. BEFORE US, LEARNED COUNSEL SUBMITTED THAT THE AS SESSEE IS A FARMER LIVING IN AN AVERAGE. THE SAID NOTICES COULD NOT BE SERVED UPON HIM, FURTHER HERE THE LAND ACQUIRED WAS AGRICULTURE LAND IN WHICH ASSESSEE WAS CARRYING OUT AGRICULTURE ACTIVITY, THEREFORE, IN VIEW OF SECTION 10(37), SUCH AN AMOUNT CANNOT BE TAXED AS REVENUE RECEIPT. 5. LD. DR ON THE OTHER HAND, SUBMITTED THAT THE CON DITIONS LAID DOWN IN SECTION 10(37) NEEDS TO BE SATISFIED, I.E., WHETHER THE SAID LAND WAS AN AGRICULTURE LAND IN TERMS OF S ECTION 2(14) AND THE SAID LAND USED FOR AGRICULTURE PURPOSES. TH EREFORE, THE MATTER SHOULD BE RESTORED BACK TO THE FILE OF T HE ASSESSING OFFICER SO THAT ALL THESE CONDITIONS CAN BE VERIFIE D. 6. AFTER CONSIDERING THE AFORESAID SUBMISSIONS AND ON PERUSAL OF THE MATERIAL REFERRED TO BEFORE HIM AT T HE TIME OF HEARING, I FIND THAT ENTIRE ISSUE REVOLVES AROUND T AXING OF ENHANCED COMPENSATION RECEIVED BY THE ASSESSEE IN T ERMS OF SECTION 28 OF LAND ACQUISITION ACT, 1894. THE LD. A SSESSING OFFICER HAS TAXED 50% OF THE SAID ENHANCED COMPENSA TION AS INTEREST U/S.56 (2)(VII) AND 57(IV). HOWEVER, IF TH E ASSESSEE HAS I.T.A. NO.7459/DEL/2018 3 RECEIVED COMPENSATION UNDER COMPULSORY ACQUISITION UNDER ANY LAW AND SUCH A LAND IS SITUATED IN THE AREA REF ERRED TO IN ITEM (A) OR ITEM (B) OF SUB CLAUSE (III) OF CLAUSE (14) OF SECTION 2; AND SUCH LAND DURING THE PERIOD OF TWO YEARS IMM EDIATELY PRECEDING THE DATE OF TRANSFER WAS BEING USED FOR A GRICULTURE PURPOSES, THEN IN TERMS OF SECTION 10(37) THE SAME CANNOT BE TAXED. IN MY OPINION THIS ISSUE SHOULD BE REMANDED BACK TO THE FILE OF ASSESSING OFFICER, WHO SHALL EXAMINE TH E CONDITIONS GIVEN IN SECTION 10(37) AND GIVE APPROPRIATE RELIEF TO THE ASSESSEE. THE ASSESSEE SHALL CO-OPERATE WITH THE AS SESSING OFFICER IN SUBSTANTIATING THE CONDITION LAID DOWN U /S.10 (37). WITH THIS OBSERVATION, APPEAL OF THE ASSESSEE IS TR EATED AS ALLOWED FOR STATISTICAL PURPOSES. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 26 TH APRIL, 2019. SD/- [AMIT SHUKLA] JUDICIAL MEMBER DATED: 26 TH APRIL, 2019 PKK: