ITO, Jaipur V. BHAIRURAM BAGRO S/O DEVA, Jaipur

ITA 780/JPR/2010

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 47951 (ITAT-JAIPUR)
• Duration Of Justice: 11 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-06-2011
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2006-2007
• Appeal Filed On: 16-06-2010
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: P C PORWAL
• Keywords: Capital asset; Opportunity of being heard; Additional evidence
• Section: 2(14); 142(1); 144

Judgement Text

1 ITA 780-10 IN THE INCOME TAX APPELLATE TRIBUNAL JAIPUR BENCH B JAIPUR BEFORE SHRI R.K. GUPTA AND SHRI N.L. KALRA ITA NO. 780/JP/2010 ASSTT. YEAR : 2006-07. THE INCOME-TAX OFFICER, VS. SHRI BHAIRURAM BAGRA, S/O WARD 7(2), JAIPUR. SHRI DEVA, VILL. JAISINGHPUR A, BHANKROTA, JAIPUR. (APPELLANT) (RESPONDENT) C.O. NO. 50/JP/2011 ( ARISING OUT OF ITA NO. 780/JP/2010 ) ASSTT. YEAR : 2006-07. SHRI BHAIRURAM BAGRA, VS. THE INCOME-TAX OFFICER, JAIPUR. WARD 7(2), JAIPUR. (CROSS OBJECTOR) (RESPONDENT) APPELLANT BY : SHRI SUNIL MATHUR RESPONDENT BY : SHRI P.C. PORWAL ORDER DATE OF ORDER : 10/06/2011. PER BENCH : THIS IS AN APPEAL BY DEPARTMENT AND A CROSS OBJECT ION BY ASSESSEE AGAINST THE ORDER OF LD. CIT (A) RELATING TO ASSESSMENT YEAR 20 06-07. 2. THE DEPARTMENT IS OBJECTING IN ACCEPTING THE ADD ITIONAL EVIDENCE UNDER RULE 46A. RELIANCE HAS BEEN PLACED IN THE CASE OF CIT VS. SHA NKAR LAL VED PRAKASH, 212 CTR 47 (DEL.), AND DELETING THE ADDITION OF RS. 1,20,02,25 3/- MADE ON ACCOUNT OF UNEXPLAINED BANK DEPOSIT TREATING ENTIRE DEPOSITS AS SALE PROCE EDS OF AGRICULTURAL LAND AND TO TAX IT AS 2 LONG TERM CAPITAL GAIN ON THE BASIS OF EVIDENCES PR ODUCED BY THE ASSESSEE DURING APPELLATE PROCEEDINGS. 3. ASSESSMENT IN THIS CASE WAS COMPLETED UNDER SECT ION 144 ON AN INCOME OF RS. 1,20,02,253/-. BEFORE COMPLETING THE ASSESSMENT UN DER SECTION 144, NOTICE UNDER SECTION 142(1) OF THE ACT WAS ISSUED ON THE BASIS OF INFORM ATION RECEIVED FROM CENTRAL BANK OF INDIA IN RESPECT TO VARIOUS DEPOSITS IN ACCOUNT OF THE ASSESSEE. HOWEVER, NONE APPEARED BEFORE AO. THEREFORE, AO PROPOSED EX PARTE ASSESSME NT ORDER BY MAKING IMPUGNED ADDITION. IT WAS SUBMITTED BEFORE LD. CIT (A) THAT NO RETURN WAS RECEIVED FROM THE AO, THEREFORE, THE ORDER OF AO IS BAD IN LAW. IN RESPE CT TO ADDITION, IT WAS ARGUED THAT IN THE BANK ACCOUNT THE ASSESSEE DEPOSITED THE AMOUNT OUT OF SALE OF AGRICULTURAL LAND AND IT WAS SUBMITTED THAT AGRICULTURAL LAND LOCATED AT VILLAGE JAISINGHPURA IN WHICH THE ASSESSEE HAD 1/3 RD SHARE WHICH WAS AGREED TO BE SOLD TO RAJASTHAN LAN D DEVELOPERS AS PER AGREEMENT OF SALE DATED 24.10.2005 AND OUT OF TOTAL CONSIDERA TION OF RS. 1.29 CRORES OR ODD, THE ASSESSEE HAD RECEIVED RS. 1.20 CRORES. THE POSSESS ION HAS NOT BEEN GIVEN AND REGISTRATION HAS NOT BEEN MADE. THEREFORE, NO CAPITAL GAIN CAN B E ASSESSED IN THE YEAR UNDER CONSIDERATION. IN SUPPORT OF THE ABOVE DETAILS, THE ASSESSEE FILED COPY OF BANK ACCOUNT, COPY OF AGREEMENT AS WELL AS COPIES OF CHEQUES SHOW ING RECEIPT OF RS. 1.20 CRORES. IT WAS ALSO SUBMITTED THAT THESE DETAILS COULD NOT BE FILED BEFORE THE AO AS NO NOTICE WAS RECEIVED FROM THE AO, THEREFORE, THEY SHOULD BE ADM ITTED UNDER RULE 46A. COPY OF THE WRITTEN SUBMISSION ALONG WITH THE AFOREMENTIONED DE TAILS WAS SENT TO THE AO FOR HIS OBJECTION/COMMENT SIN TERMS OF RULE 46A. FIRSTLY, THE AO OBJECTED IN ADMITTING THE ADDITIONAL EVIDENCE AS AMPLE OPPORTUNITY WAS GIVEN BY HIM. SECONDLY, ON MERIT IT WAS SUBMITTED THAT THE AMOUNT IS TAXABLE AS THE LAND IN QUESTION SITUATED WITHIN 8 KM OF 3 MUNICIPAL LIMIT. THE LEGAL GROUND THAT NOTICE WAS SERVED WAS REJECTED BY LD. CIT (A) AS NOTICE WAS SENT THROUGH VALID METHOD. ON MERIT, IT WAS HELD BY LD. CIT (A) THAT THE AMOUNT IS RECEIVED ON ACCOUNT OF SALE CONSIDERATION OF LAND, THEREFORE, THE SAME IS ASSESSABLE AS LONG TERM CAPITAL GAIN. ACCORDINGLY, THE AO WAS DIRECTED TO TAX ON THE BASIS OF CAPITAL GAIN. HOWEVER, THE CONTENTION OF T HE ASSESSEE THAT THE AMOUNT IS NOT TAXABLE IN TERMS OF SECTION 2(14) READ WITH SECTION 2(47) THAT NEITHER THE POSSESSION HAS BEEN GIVEN NOR REGISTRATION HAS BEEN MADE, THEREFOR E, THE AMOUNT OF RS. 1.20 CRORES CANNOT BE ASSESSED IN THE YEAR UNDER CONSIDERATION FOR THE REASON THAT NO EVIDENCE IN THIS RESPECT WAS FILED BEFORE HIM. 4. NOW BOTH ARE IN APPEAL HERE BEFORE THE TRIBUNAL . 5. THE LD. D/R FIRSTLY SUBMITTED THAT ADDITIONAL EV IDENCE ADMITTED BY LD. CIT (A) WERE NOT ADMITTED CORRECTLY AS AMPLE OPPORTUNITY WA S GIVEN BY AO AND THEY HAVE NOT BEEN AVAILED. THEREFORE, LD. CIT (A) SHOULD NOT HAV E ACCEPTED THE ADDITIONAL EVIDENCE. 6. IN RESPECT TO GROUND NO. 2, IT WAS SUBMITTED THA T IF THE FIRST CONTENTION OF THE DEPARTMENT IS ACCEPTED THEN THE ADDITION MADE BY AO IS LIABLE TO BE CONFIRMED AND IF THE FIRST GROUND IS NOT ACCEPTED THEN SECOND GROUND OF THE DEPARTMENT WILL BECOME INFRUCTUOUS IN NATURE. 7. ON THE OTHER HAND, THE LD. A/R FIRSTLY STATED TH AT IN RESPECT TO ADDITIONAL EVIDENCES THEY HAVE BEEN ADMITTED BY LD. CIT (A) AFTER DULY A LLOWING OPPORTUNITY TO THE AO. EVEN THE LD. CIT (A) HAS WIDER POWER AND HE CAN ADMIT TH E ADDITIONAL EVIDENCE OF HIS OWN. HOWEVER, IN THE PRESENT CASE THE AO HAS GIVEN REPLY ON MERIT ALSO. THEREFORE, THERE IS NO QUESTION OF NOT ADMITTING THE ADDITIONAL EVIDENCE. ALL THE EVIDENCES FILED GOES TO THE ROOT 4 OF THE CASE. THEREFORE, IN VIEW OF MEETING THE ENDS OF JUSTICE, THE EVIDENCES SHOULD HAVE BEEN ADMITTED AND THEY HAVE RIGHTLY BEEN ADMITTED. 8. IN RESPECT TO ISSUE ON MERIT, IT WAS SUBMITTED T HAT AT THAT POINT OF TIME NO EVIDENCE WAS AVAILABLE IN RESPECT TO TRANSFER OF LAND IN QUE STION. HOWEVER, NOW THEY ARE AVAILABLE. THE POSSESSION IS STILL WITH THE ASSESSEE. THE SAL E DEED HAS NOT BEEN EXECUTED AND THE LAND IN QUESTION IS MORTGAGED BY THE ASSESSEE WITH THE BANK AGAINST LOAN TAKEN BY HIM. ALL THESE EVIDENCES ARE PLACED ON RECORD AND IT WAS SUBMITTED THAT EVIDENCES GO TO THE ROOT OF THE CASE AND, THEREFORE, THEY SHOULD BE ADM ITTED AND THEY SHOULD BE SENT BACK TO THE AO TO EXAMINE THE SAME. IT WAS FURTHER SUBMITT ED THAT IF THIS CONTENTION OF ASSESSEE IS ADMITTED THEN THE CROSS OBJECTION NEED NOT TO BE ADJUDICATED. 9. AFTER HEARING RIVAL SUBMISSIONS AND CONSIDERING THE MATERIAL ON RECORD, WE FIND THAT LD. CIT (A) WAS JUSTIFIED IN ADMITTING THE ADD ITIONAL EVIDENCES FILED BEFORE HIM. THEY ARE NOTHING BUT IN SUPPORT OF THE CLAIM THAT THE DE POSITS IN THE BANK WERE OUT OF SALE OF AGRICULTURAL LAND. THE AO WAS ALLOWED OPPORTUNITY A LSO. THEREFORE, THE CONTENTIONS OF THE DEPARTMENT ARE REJECTED THAT THE LD. CIT (A) WAS NO T CORRECT IN ADMITTING THE SAME. HOWEVER, NOW ASSESSEE HAS FILED SOME FURTHER ADDITI ONAL EVIDENCES AND THEY GO TO THE ROOT OF THE CASE AS THEY RELATED TO TRANSFER OF PRO PERTY AS WELL AS POSSESSION OF PROPERTY WHICH HAS NOT BEEN GIVEN BY THE ASSESSEE AND THE LA ND IN QUESTION IS MORTGAGED TO THE BANK AGAINST LOAN FACILITY. THESE EVIDENCES WERE N OT FILED BEFORE THE LOWER AUTHORITY. THEREFORE, TO CONSIDER THESE EVIDENCES AND TO EXAMI NE THE ISSUE AFRESH IN LIGHT OF THESE EVIDENCES, WE RESTORE THE MATTER TO THE FILE OF AO TO PASS A FRESH ORDER AFTER AFFORDING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESS EE. WE ORDER ACCORDINGLY. 5 10. SINCE WE HAVE SET ASIDE THE ORDER OF LD. CIT (A ) AND RESTORED THE MATTER TO THE FILE OF AO, THEREFORE, THERE IS NO NEED TO DECIDE THE CR OSS OBJECTION SEPARATELY. 11. IN THE RESULT, APPEAL OF THE DEPARTMENT IS ALLO WED FOR STATISTICAL PURPOSES AND CROSS OBJECTION IS DISPOSED OFF ACCORDINGLY. 12. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 10 .6.2011. SD/- SD/- ( N.L. KALRA ) ( R.K. GUPTA ) ACCOUNTANT MEMBER JUDICIAL MEMBER JAIPUR, D/- COPY FORWARDED TO :- THE ITO WARD 7(2), JAIPUR. SHRI BHAIRURAM BAGRA, JAISINGHPURA, BHANKROTA, JAIP UR. THE CIT (A) THE CIT THE D/R GUARD FILE (ITA NO. 780(2)/JP/2010) BY ORDER, AR ITAT JAIPUR.