Chinnanna Bobbili, Hyderabad V. Income Tax Officer, Ward-2, Nizambad, Nizambad

ITA 772/Hyd/2020

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 3106 (ITAT-HYDERABAD)
• Duration Of Justice: 6 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-06-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2014-2015
• Appeal Filed On: 14-12-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N SRIKANTH
• Assessee Lawyers: D V ANJANEYULU
• Keywords: Sale consideration of property below Jantri Value; Principle of natural justice; Additional evidence
• Section: 56(2)(vii)(b); 147; 148

Judgement Text

ITA NO 772 OF 2020 CHINNANNA BOBBILI HYDERABAD PAGE 1 OF 5 IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD SMC BENCH, HYDERABAD (THROUGH VIDEO CONFERENCING) BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER ITA NO.772/HYD/2020 ASSESSMENT YEAR: 2014-15 SRI CHINNANNA BOBBILI HYDERABAD PAN:BIYPB7062G VS. INCOME TAX OFFICER WARD 2 NIZAMABAD (APPELLANT) (RESPONDENT) ASSESSEE BY: SRI D.V.ANJANEYULU REVENUE BY : SRI N. SRIKANTH, DR DATE OF HEARING: 09/06/2021 DATE OF PRONOUNCEMENT: 17/06/2021 ORDER THIS IS ASSESSEES APPEAL FOR THE A.Y 2014-15 AGAIN ST THE ORDER OF THE CIT (A)-5, HYDERABAD, DATED 23.09. 2019. 2. BRIEF FACTS OF THE CASE ARE THAT THE REVENUE REC EIVED INFORMATION THAT THE ASSESSEE INDIVIDUAL, HAS PURCH ASED AN OPEN LAND IN SURVEY NO.1072 & 1073, SHIVAR, NIZAMABAD TO THE EXTENT OF 30 GUNTAS IN THE FINANCIAL YEAR 2013-14 FOR A CO NSIDERATION OF RS.24,00,000/- AS AGAINST THE MARKET VALUE OF RS.54 ,45,000/-. THEREFORE, THE ASSESSING OFFICER WAS OF THE OPINION THAT THE PROVISIONS OF SECTION 56(2)(VII)(B) OF THE I.T. ACT ARE APPLICABLE TO THIS CASE AND THAT THE DIFFERENCE BETWEEN THE STAMP DUTY VALUE AND THE PURCHASE CONSIDERATION IS TAXABLE UNDER THE HEAD INCOME FROM OTHER SOURCES IN THE HANDS OF THE PUR CHASER I.E. THE ASSESSEE HEREIN. HE ALSO OBSERVED THAT THE ASSESSEE HAS NOT FILED THE RETURN OF INCOME FOR THE A.Y 2014-15 AND THEREF ORE, BELIEVING THAT THERE IS AN ESCAPEMENT OF INCOME, THE ASSESSIN G OFFICER ITA NO 772 OF 2020 CHINNANNA BOBBILI HYDERABAD PAGE 2 OF 5 INITIATED PROCEEDINGS U/S 147 OF THE ACT BY ISSUANC E OF NOTICE U/S 148 OF THE ACT. 3. IN RESPONSE THERETO, THE ASSESSEE FILED A LETTER DATED 11.9.2017 STATING THAT THE RETURN OF INCOME FILED O N 25.01.2016 BE TREATED AS RETURN OF INCOME FILED IN RESPONSE TO THE NOTICE U/S 148 OF THE ACT. THE ASSESSING OFFICER THEREAFTER, A SKED THE ASSESSEE TO FILE THE DETAILS WHICH WERE FILED BY TH E ASSESSEE. 4. AFTER PERUSAL OF THE DETAILS FILED BY THE ASSESS EE AND HEARING THE ASSESSEE, THE ASSESSING OFFICER OBSERVE D THAT THE ASSESSEE HAS NOT SHOWN THE DIFFERENCE BETWEEN THE S ALE CONSIDERATION OF RS.24,00,000/- AND THE MARKET VALU E OF RS.54,45,000/- AS INCOME FROM OTHER SOURCES IN HI S RETURN OF INCOME. THEREFORE, HE BROUGHT IT TO TAX U/S 56(2)(V II)(B) OF THE I.T. ACT. HE FURTHER ALSO DISALLOWED AN AMOUNT OF RS.73, 230/- BEING THE CLAIM OF DEDUCTION UNDER CHAPTER VI OF THE ACT SINCE THE ASSESSEE DID NOT FILE THE PROOF THEREOF. 5. AGAINST THIS ORDER OF THE ASSESSING OFFICER, THE ASSESSEE FILED AN APPEAL BEFORE THE CIT (A) WHO DIS MISSED THE APPEAL IN LIMINI ON ACCOUNT OF DELAY AND ALSO FOR N ON-APPEARANCE OF THE ASSESSEE. THERE WAS A DELAY OF 133 DAYS IN F ILING OF THE APPEAL AND THE CIT (A) WAS NOT SATISFIED WITH THE R EASONS GIVEN FOR THE DELAY. AGAINST THIS ORDER OF THE CIT (A), THE A SSESSEE IS IN APPEAL BEFORE THE TRIBUNAL BY RAISING THE FOLLOWING GROUNDS OF APPEAL. 1. THE ORDER OF LD. CIT(A) IN DISMISSING THE APPEA L IN LIMINI ON ACCOUNT OF DELAY IN FILING APPEAL AND OBSERVING THAT IT IS ALSO LIABLE FOR DISMISSAL ON NON-PROSECUTION AND ME RITS IS ERRONEOUS IN LAW AND AGAINST THE PRINCIPLES OF EQUI TY AND NATURAL JUSTICE. ITA NO 772 OF 2020 CHINNANNA BOBBILI HYDERABAD PAGE 3 OF 5 2. LD. CIT(A) OUGHT TO HAVE CONDONED THE DELAY IN F ILING THE APPEAL BEFORE HIM ULS 249(3) BY 133 DAYS AS THE APP ELLANT WAS PREVENTED BY SUFFICIENT CAUSE IN FILING THE APP EAL AS THE DELAY IS PURELY DUE TO TECHNICAL REASONS AND ASSESS EE WAS IN GENUINE BELIEF THAT APPEAL WAS FILED IN TIME AND FILING FEE WAS ALSO PAID IN TIME ON 19.01.2018 AND SUCH DELAY OUGHT TO HAVE BEEN CONDONED TO MEET THE ENDS OF JUSTICE A S HELD IN THE CASE OF COLLECTOR, LAND ACQUISITION V MST. KATI JI & OTHERS [1987J 167 ITR 471 (SC). 3. SUBJECT TO ABOVE, ON MERITS THE LD. CIT(A) ERRED IN LAW BY NOT APPRECIATING IN PROPER PERSPECTIVE THE FACT THA T APPELLANT HAS ENTERED INTO AN AGREEMENT FOR SALE ON 15/03/2013 AND HAS PAID THE SALE CONSIDERATION OVER THE PERIOD OF MARCH AND APRIL, 2013, THE SALE DEED WAS REGISTERED ON 05/08/2013. THE AMENDMENT IN SECTION 56(2)(VII)(B) BY INTRODUCTION OF SUB CLAUSE (II) W. E.F AY 2014- 15 AND THE PROVISIONS OF THE ACT EXISTING AS ON THE DATE OF AGREEMENT NEEDS TO BE APPLIED AND THE ACTION OF AO IN APPLYING THE PROVISIONS RETROSPECTIVELY IS BAD IN L AW AND AS SUCH THE VERY ORDER IS VOID AB-INTIO AS HELD IN [20 20] 429 ITR 97 (MAD) CIT VS VUMMUDI AMARENDRAN AND [2020] 2 07 TT J (VISAKHA) 239 ASST. CIT VS ANALA ANJIBABU. 4. LD. CIT(A) OUGHT TO APPRECIATED THAT AS THERE IS NO ESCAPEMENT OF TAXABLE INCOME AS ENVISAGED UNDER THE PROVISIONS OF SECTION 147 OF THE ACT AND THEREFORE ISSUANCE OF NOTICE ULS 148 WITHOUT RECORDING PROPER REASONS FOR JUSTIFYING THE RE-OPENING IS BAD IN LAW AND THE VER Y ORDER IS INVALID. 5. SUBJECT TO GROUND NO. 3, LD. CIT(A) OUGHT TO HAV E APPRECIATED THE FACT THAT REFERENCE TO VALUATION OF FICER THOUGH INTRODUCED SUBSEQUENTLY BY THE FINANCE ACT, 2014 IS A PROCEDURAL PROVISION AND AO WAS REQUIRED TO REFER THE MATTER TO VALUATION OFFICER, FAILURE TO DO SO HAS R ESULTED IN VITIATING THE ORDER. 6. FOR THESE AND OTHER REASONS THAT MAY BE URGED AT THE TIME OF HEARING, THE APPELLANT PRAYS THE HONORABLE TRIBUNAL TO KINDLY DELETE THE ADDITION MADE BY AO AND CONFIR MED BY CIT(A). 6. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED T HAT HE HAS ENTERED INTO AN AGREEMENT OF SALE ON 15.5.20 18 FOR PURCHASE OF PROPERTY FOR A CONSIDERATION OF RS.24,0 0,000/- AND HAS ALSO PAID PART OF THE CONSIDERATION OF RS.15.00 LAKHS IN MARCH, 2013 AND THE BALANCE WAS PAID IN THE MONTHS OF APRIL & ITA NO 772 OF 2020 CHINNANNA BOBBILI HYDERABAD PAGE 4 OF 5 AUGUST, 2013. HE SUBMITTED THAT THE PROVISIONS OF S ECTION 56(2)(VII)(B) WERE EFFECTIVE FROM 1.4.2014 AND THER EFORE, THE SALE CONSIDERATION WHICH WAS FIXED PRIOR TO SUCH DATE HA S TO BE TAKEN INTO CONSIDERATION AND IN SUCH CIRCUMSTANCES, THE P ROVISIONS OF SECTION 56(2)(VII)(B) WOULD NOT GET ATTRACTED. IN S UPPORT OF THIS CONTENTION, HE PLACED RELIANCE UPON THE DECISION OF THE HON'BLE MADRAS HIGH COURT IN THE CASE OF CIT VS. VUMMUDI AM ARENDRAN REPORTED IN (2020)429 ITR 97 (MAD.) AND THE DECISIO N IN THE CASE OF ACIT VS. ANALA ANJIBABU RENDERED BY ITAT VISAKHA PATNAM IN ITA NO.415/VIZ/2019 DATED 17.8.2020 REPORTED IN (20 20) 270 TTJ (VISAKHA)239. THE ASSESSEE HAS ALSO FILED ADDITIONA L EVIDENCE BEING THE COPIES OF THE AGREEMENT OF SALE AND THE S ALE DEED IN SUPPORT OF HIS CONTENTION. THE LEARNED COUNSEL FOR THE ASSESSEE THUS PRAYED FOR RELIEF ACCORDINGLY. 7. THE LEARNED DR, HOWEVER, SUPPORTED THE ORDERS OF THE CIT (A). 8. HAVING REGARD TO THE RIVAL CONTENTIONS AND THE M ATERIAL ON RECORD, I FIND THAT THE CIT (A) HAS NOT DISPOSED OF THE ASSESSEES APPEAL ON MERITS BUT HAS DISMISSED THE A PPEAL BY NOT CONDONING THE DELAY OF 133 DAYS. I FIND THAT THE AS SESSEE HAS EXPLAINED THE REASONS FOR THE DELAY AS THE ILLNESS OF HIS OLD AGED FATHER (80 YEARS) WHO ULTIMATELY DIED ON 23.9.2020. I FIND THAT THE ASSESSEE HAD NOT GIVEN THESE DETAILS IN THE AFFIDAV IT FILED BEFORE THE CIT (A) FOR CONDONATION OF DELAY. FURTHER, THE ADDITIONAL EVIDENCE FILED BY THE ASSESSEE SUCH AS THE AGREEMEN T OF SALE ETC., ALSO NEEDS TO BE VERIFIED. THEREFORE, IN THE INTERE ST OF JUSTICE, I DEEM IT FIT AND PROPER TO REMAND THE ISSUE TO THE F ILE OF THE CIT (A) WITH A DIRECTION TO THE ASSESSEE TO FILE PROPER AFF IDAVIT EXPLAINING ITA NO 772 OF 2020 CHINNANNA BOBBILI HYDERABAD PAGE 5 OF 5 THE REASONS FOR THE DELAY AND ALSO DIRECT THE CIT ( A) TO CONSIDER THE EVIDENCE FILED BY THE ASSESSEE AND RE-ADJUDICAT E THE ISSUES ON MERITS AS WELL, IF HE IS INCLINED TO CONDONE THE DE LAY. 9. IN THE RESULT, ASSESSEES APPEAL IS TREATED AS A LLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 17 TH JUNE, 2021. SD/- (P. MADHAVI DEVI) JUDICIAL MEMBER HYDERABAD, DATED 17 TH JUNE, 2021. VINODAN/SPS COPY TO: S.NO ADDRESSES 1 SRI CHINNANNA BOBBILI C/O M/S.ANJANE YULU & CO. C.A, 30 BHAGYALAKSHMI NAGAR, GANDHINAGAR, HYDERABAD 500080 2 INCOME TAX OFF ICER WARD - 2 NIZAMABAD 3 CIT (A) - 5, HYDERABAD 4 PR. CIT 5, HYDERABAD 5 DR, ITAT HYDERABAD BENCHES 6 GUARD FILE BY ORDER