Sh. Parabhdip Singh, Patiala V. ITO, W-3, Patiala

ITA 762/CHANDI/2018

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 4505 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 year(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-05-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2014-2015
• Appeal Filed On: 24-05-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N D GUPTA
• Keywords: Unexplained expenditure; Revised return; Set aside
• Section: 69C

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BENCH SMC CHANDIGARH , ! BEFORE: SMT. DIVA SINGH, JM ./ ITA NO. 762/CHD/2018 / ASSESSMENT YEAR : 2014-15 SHRI PARABHDIP SINGH, #79-84, PANJLAND ESTATE, VILL. RAUNI, OPP-CHAHAL PALACE, PATIALA. VS THE ITO, WARD-3, PATIALA. ./ PAN NO. : ADHPS8007M / APPELLANT / RESPONDENT / ASSESSEE BY : SHRI VIBHOR GARG / REVENUE BY : SHRI N.D.GUPTA, JCIT ! ' # / DATE OF HEARING : 22.05. 2019 $%&' # / DATE OF PRONOUNCEMENT : 31.05.2019 '#/ ORDER THE PRESENT APPEAL HAS BEEN FILED BY THE ASSESSEE A SSAILING THE CORRECTNESS OF THE ORDER DATED 05.03.2018 OF CIT(A)-3 LUDHIANA PER TAINING TO 2014-15 ASSESSMENT YEAR ON THE FOLLOWING GROUNDS : 1. THAT THE IMPUGNED ORDER IS BAD BOTH ON FACTS AND LA W. 2. THAT THE LD APPELLATE AUTHORITY HAS WRONGLY AND ILL EGALLY UPHELD THE ADDITION OF RS 10,30,502/- ON ACCOUNT OF UNEXPLAINED EXPENDITURE FOR EARNING A GRICULTURAL INCOME U/S 69C OF INCOME TAX ACT 1961 IN THE HANDS OF THE APPELLANT ALTHOUGH IT IS ACCEPTED THAT THE AGRICULTURAL INCOME BELONGS TO HUF. 3. THAT THE APPELLANT CRAVES PERMISSION TO AMEND, ALTER, ADD, DELETE ANY GROUND OF APPEAL . 2. THE RELEVANT FACTS OF THE CASE ARE THAT THE ASSE SSEE IN THE YEAR UNDER CONSIDERATION HAS RETURNED AN INCOME OF RS. 5,17,41 0/- PLUS AGRICULTURE INCOME OF RS. 25,76,255/-. THE AO PUT THE ASSESSEE TO NOTICE OF THE FACT THAT FROM THE CLAIM OF GROSS AGRICULTURAL INCOME EXPENSES NEED TO BE REDUC ED THEREFROM. ACCORDINGLY, AFTER MAKING SOME LOCAL FIELD ENQUIRIES FROM AN INSPECTOR , HE CONFRONTED THE SAME TO THE ITA 762/CHD/2018 A.Y. 2014-15 PAGE 2 OF 4 ASSESSEE AND THUS REDUCED THE AGRICULTURE INCOME BY ESTIMATING THE EXPENSES TO THE TUNE OF RS. 10,30,502/-. ADDITION TO THE SAID AMOUN T WAS MADE. 3. THE ASSESSEE CARRIED THE ISSUE IN APPEAL BEFORE THE CIT(A) WHO CONFIRMED THE ADDITION. 4. AGGRIEVED THE ASSESSEE IS IN APPEAL BEFORE THE I TAT. 5. THE LD. AR ADDRESSING THE GRIEVANCE SUBMITTED TH AT THE ASSESSEE WAS IGNORANT ABOUT THE CONCEPT OF GROSS AND NET INCOME AND WHAT WAS SHOWN AS HIS GROSS AGRICULTURE INCOME WAS INFACT THE ASSESSEE'S NET AG RICULTURE INCOME. APART FROM THAT, IT WAS HIS SUBMISSION THAT EVEN OTHERWISE, IT WAS N OT HIS EXCLUSIVE INCOME. THE SAID INCOME, IT WAS SUBMITTED, HAD BEEN WRONGLY SHOWN I N THE HANDS OF THE ASSESSEE AS IT WAS FROM HUF PROPERTY WHEREIN THE LAND BELONGED TO HIM AND HIS FATHER. ATTENTION WAS INVITED TO PAPER BOOK PAGE 29 TO SHOW THAT TRAN SLATION OF THE KURSINAMA PREPARED BY HALKA PATWARI WOULD SHOW THAT THE SPECI FIC LAND FROM SHRI ISSAR SINGH WAS INHERITED BY SHRI BALDEV SINGH, ASSESSEE'S FATH ER AND SINCE THE LAND WAS UNDERSTOOD TO BE DIVIDED BETWEEN THE ASSESSEE AND H IS FATHER, THOUGH NO DIVISION BY MUTATION HAD TAKEN PLACE HE WAS NOT SURE OF THE STA TUS. RELIANCE WAS PLACED UPON DECISION IN THE CASE OF KARAN BIR SINGH VS ITO 1982 (4) TMI 127-ITAT CHANDIGARH TTJ 014, 528 IT WAS HIS SUBMISSION THAT SINCE THE LAND DID NOT SOLELY BELONGE TO THE ASSESSEE, THE ADDITION ON FACTS WAS WRONGLY MADE AN D SUSTAINED AND THE ASSESSEE'S ATTEMPT TO FILE REVISED RETURN WAS REJECSTED BY THE DEPARTMENT AS BEING TIME BARRED. RELEVANT EXTRACT OF THE AFORESAID DECISION RELIED U PON IS EXTRACTED HEREUNDER : 5. COMING TO GROUND NOS. 2 & 3 WHICH ARE IN RESPECT OF CAPITAL GAIN COMPUTED IN RESPECT OF 'SHAMLAT' LAND, FROM PERUSAL OR ORDERS OF THE TWO L OWER AUTHORITIES ON THIS ISSUE AND FROM THE SUBMISSIONS OF BOTH THE PARTIES BEFORE US, WE FIND NO CONTROVERSY ABOUT THE FACT THAT THE LAND IN QUESTION DID NOT BELONG TO THE ASSESSEE AS AN INDIV IDUAL IN THE STATUS OF WHICH THE ASSESSMENT UNDER CONSIDERATION HAS BEEN MADE AND THE LAND IN Q UESTION WAS REALLY A 'SHAMLAT' LAND AND IN THE SAID LAND THE ASSESSEE WAS HOLDING A SHARE ONLY AS KARTA OF THE SAME. WHEN THESE ARE THE UNCONTROVERTED FACTS THE CONTENTION OF THE ID COUNS EL FOR THE ASSESSEE THAT NO CAPITAL GAINS ARISES IN THE HANDS OF THE ASSESSEE AS INDIVIDUAL IS NOT W ITHOUT FORCE AND THEREFORE, THE CAPITAL GAINS COMPUTED IN RESPECT OF 'SHAMLAT' LAND IN THE HANDS OF THE ASSESSEE IS DIRECTED TO BE DELETED. ITA 762/CHD/2018 A.Y. 2014-15 PAGE 3 OF 4 5.1 RELYING ON CONSISTENCY, IT WAS ALSO SUBMITTED T HAT THE ASSESSEE IN THE EARLIER YEARS HAS BEEN DISCLOSING AGRICULTURE INCOME IN HIS RETURNS FOR RATE PURPOSES ON A SIMILAR MANNER AND AT NO POINT OF TIME ADDITION IN THIS ARBITRARY MANNER WAS MADE IN THE HANDS OF THE ASSESSEE. HOWEVER, ON PRIMARY FACTS, IT WAS HIS SUBMISSION THAT TILL PARTITION IS AFFECTED, THE LAND CAN NOT BE SAI D TO BELONG TO THE ASSESSEE. 6. THE LD. SR.DR SHRI N.D.GUPTA RELYING UPON ORDERS SUBMITTED THAT THE AGRICULTURE PROCEEDS WERE DEPOSITED BY THE ASSESSEE IN HIS BANK ACCOUNT AND ON THE PAST HISTORY OF THE ISSUE, HE SAID HE WAS UNABLE TO COMMENT IN THE ABSENCE OF ANY RELEVANT DISCUSSION IN THE ORDERS. SIMILARLY ON THE CLAIM NOW BEING MADE THAT THE OWNERSHIP OF THE LAND ALSO DID NOT VEST WITH THE AS SESSEE, HE SUBMITTED THAT THERE WAS NO DISCUSSION AS THE ISSUE HAD NOT BEEN RAISED BY THE ASSESSEE BEFORE EITHER THE AO OR THE CIT(A). 7. I HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED T HE MATERIAL AVAILABLE ON RECORD. ADMITTEDLY, THE ISSUE OF OWNERSHIP OF THE LAND WAS NEVER RAISED BY THE ASSESSEE BEFORE THE TAX AUTHORITIES. THOUGH THE SAL E PROCEEDS FROM THE AGRICULTURAL ACTIVITY IS SAID TO HAVE BEEN DEPOSITED IN THE ASSE SSEE'S BANK ACCOUNT, THE FACT REMAINS THAT OWNERSHIP OF AGRICULTURAL LAND NEEDS T O BE ADDRESSED. ACCORDINGLY, IN THE LIGHT OF THE SUBMISSIONS OF THE PARTIES BEFORE THE BENCH, IT IS DEEMED APPROPRIATE TO SET ASIDE THE IMPUGNED ORDER BACK TO THE FILE OF THE AO WITH THE DIRECTION TO CONSIDER THE CLAIM OF PAST HISTORY OF THE ISSUE I.E . SIMILAR RETURN OF AGRICULTURE INCOME FOR THE RATE PURPOSES IN THE HANDS OF THE ASSESSEE. THE AO SHALL ALSO CONSIDER THE MERITS OF THE CLAIM MADE NAMELY THAT THE ASSESSEE O VER THE YEARS WAS NOT IN A POSITION TO UNDERSTAND THE DIFFERENCE BETWEEN GROSS AND NET AGRICULTURE INCOME AS ARGUED AND ONLY NET INCOME WRONGLY DESCRIBED AS GRO SS INCOME WAS BEING SHOWN FOR RATE PURPOSES. THE AO SHALL ALSO CONSIDER THE CLAI M MADE NAMELY THAT THE OWNERSHIP OF THE LAND VESTED WITH THE FATHER OF THE ASSESSEE SHRI BALDEV SINGH. ACCORDINGLY, THE IMPUGNED ORDER IS SET ASIDE BACK TO THE AO WITH DIR ECTION TO PASS A SPEAKING ORDER IN ACCORDANCE WITH LAW AFTER GIVING THE ASSESSEE A REA SONABLE OPPORTUNITY OF BEING ITA 762/CHD/2018 A.Y. 2014-15 PAGE 4 OF 4 HEARD. THE ASSESSEE IN ITS OWN INTERESTS IS ADVISED TO PARTICIPATE FULLY AND FAIRLY AS FAILING WHICH IN THE EVENTUALITY OF ABUSE OF THE TR UST REPOSED, THE AO WILL BE AT LIBERTY TO PASS AN ORDER ON THE BASIS OF MATERIAL AVAILABLE ON RECORD. SAID ORDER WAS PRONOUNCED IN THE OPEN COURT AT THE TIME OF HEARING ITSELF. 8. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 31 ST MAY 2019. SD/- ( ) (DIVA SINGH) ! / JUDICIAL MEMBER % & %( )* +* / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT - 2. / THE RESPONDENT - 3. ! , / CIT 4. ! , ( )/ THE CIT(A) 5. *-. / , # / , 012.3 / DR, ITAT, CHANDIGARH 6. .2 4' / GUARD FILE %( ! / BY ORDER, 5 / ASSISTANT REGISTRAR