Dy. Commissioner of Income Tax , Circle-11(1), Hyderabad V. Gottumukkala Rama Rao , Hyderabad

ITA 790/Hyd/2019

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 6068 (ITAT-HYDERABAD)
• Duration Of Justice: 2 year(s) 3 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-09-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB-B
• Next Hearing Date: 24-08-2021
• Assessment Year: 2008-2009
• Appeal Filed On: 17-05-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ROHIT MAJUMDAR
• Assessee Lawyers: B SAI PRASAD
• Keywords: Capital asset; Reason to believe; Capital Gains
• Section: 143(3); 131; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD B BENCH, HYDERABAD. BEFORE SHRI S.S. GODARA, JUDICIAL MEMBER AND SHRI L . P . SAHU, ACCOUNTANT MEMBER (THROUGH VIRTUAL HEARING) ITA NO. 790 /HYD/20 19 (ASSESSMENT YEAR : 20 08 - 09 ) DY. COMMISSIONER OF INCOME TAX, CIRCLE 11(1), HYDERABAD. ..APPELLANT. VS. SHRI GOTTUMUKKALA RAMA RAO, HYDE RABAD. PAN AEHPG 8391P ..RESPONDENT. APPELLANT BY : SHRI ROHIT MAJUMDAR (D.R.) RESP ONDENT BY : SHRI B SAI PRASAD. DATE OF HEARING : 24.08 . 2021. DATE OF PRONOUNCEMENT : 08 .0 9 .2021. O R D E R PER SHRI S.S. GODARA, J.M. : THIS ASSESSEES APPEAL FOR ASST. YEAR 20 08 - 09 ARISES FROM THE COMMISSIONER OF INCOME TAX (APPEALS) - 7 , HYDERABAD S ORDER DT. 20.03.2019 PASSED IN CASE NO. 077/CIT(A) - 7/2018 - 19 IN PROCEEDINGS UNDER SECTION 143(3) R.W.S. 147 OF INCOME TAX ACT, 1961 (THE ACT) . HEARD BOTH PARTIES. CASE FILE PERUSED . 2 ITA NO. 790/HYD/2019 2. COMING TO THE SOLE SUBSTANTIVE ISSUE OF CORRECTNESS OF THE LEARNED CIT(A)S ACTION DELETING LONG TERM CAPITAL GAINS (LTCG) ADDITION AMOUNTING TO RS.2,98,49,374 MADE IN THE COURSE OF REASSESSMENT FRAMED ON 31.03.2016, BOTH THE LEARNED REPRESENTATIVES INVITED OUR ATTENTION TO LOWER APPELLATE DISCUSSION TO THIS EFFECT READ ING AS UNDER : 3 ITA NO. 790/HYD/2019 4 ITA NO. 790/HYD/2019 5 ITA NO. 790/HYD/2019 6 ITA NO. 790/HYD/2019 3. WE HAVE GIVEN OUR THOUGHTFUL CONSIDERATION TO RIVAL PLEADINGS AGAINST AND IN SUPPORT OF THE CIT(A)S FOREGOING CONCLUSION DECIDING THE ISSUE OF A SSESSMENT OF LTCG IN ASSESSEE'S FAVOUR. CASE FILE SUGGESTS THAT THE ASSESSING OFFICER HAD MADE A PROTECTIVE ADDITION IN ASSESSMENT YEAR 2007 - 08 WHICH STOOD DELETED IN THE TRIBUNALS ORDER (SUPRA) 7 ITA NO. 790/HYD/2019 ON THE GROUND THAT NO TRANSFER WITHIN THE MEANING OF SECTI ON 2 ( 47 ) (V) R.W.S. 53A OF THE ACT HAD TAKEN PLACE THEREIN. THE FACTUAL POSITION IS NO DIFFERENT IN THE IMPUGNED A.Y. 2008 - 09 AS WELL AS THE RELEVANT TRANSFER STOOD COMPLETED AFTER 25.09.2012 ONLY (SUPRA). 4. WE FURTHER NOTE DURING THE COURSE OF H EARING THAT THE ASSESSING OFFICERS REOPENING REASONS RECORDED ALSO MAKE A FIT CASE TO HOLD THE SAID SECTION 148 / 147 MECHANISM BEING INVOKED HERE AS NOT SUSTAINABLE IN LAW. WE DEEM IT APPROPRIATE AT THIS STAGE TO REPRODUCE THE ASSESSING OFFICERS REAS ONS TO THIS EFFECT AS UNDER : AS PER THE SWORN STATEMENT OF SRI G. RAMA RAO, RECORDED ON 0 9 .11.2011 U/S 131 OF THE I.T. A CT, 1961 FOR THE QUESTION NO. 7 REGARDING FILING OF ALL THE DUE RETURNS OF INCOME CONSIDERING THE SUBSTANTIVE TRANSACTIONS FOR SELF AND FAMILY MEMBERS, THE ASSESSEE STATED THAT, 'IT IS TRUE THAT THERE ARE TRANSACTIONS STARTING FROM THE A.Y 2007 - 08 TO 2011 - 12 WHEREIN THE INCOME WAS REQUIRED TO BE OFFERED AND HOWEVER SOME OF THE INCOME WAS NOT OFFERED AND THE TAX ON IS YET TO BE PAID. T HOUGH THE RETURNS OF INCOME OF MYSELF AND MY WIFE HAVE BEEN FILED UPTO A. Y . 2008 - 09, CONSIDERING THE SUBSTANTIVE ISSUES AND THE INCOMES WHICH ARE REQUIRED TO BE OFFERED BY ME AND THE TAX THEREOF I WILL FILE THE RETURNS / REVISE MY RETURNS OF INCOME. IN VIEW OF THE ABOVE, I HAVE REASON TO BELIEVE THAT INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT FOR THE AY 2008 - 09 AS PER PROVISIONS OF SECTION 147 OF THE LT. ACT, 1961. 5. LEARNED DEPARTMENT REPRESENTATIVE FAILS TO DIS P UTE THE ASSESSING OFFICER S FOREGOING REOPENING REASONS 8 ITA NO. 790/HYD/2019 NOWHERE INDICATE AS TO WHETHER THE ASSESSEE HAD TRANSFERRED HIS CAPITAL ASSET IN THE RELEVANT PREVIOUS YEAR 2007 - 08 OR NOT. HONBLE BOMBAY H IGH C OURT S IN HINDUSTAN LEVER LIMITED VS. R.B. WADEKAR (2014) 268 ITR 332 (BOM) HAS HELD LONG BACK THAT THE ASSESSING OFFICERS REOPENING REASONS HAVE TO BE READ ON STANDALONE BASIS WITHOUT ANY SCOPE FOR ADDITION, DELETION OR SUBSTITUTION THEREIN AT A LATER STAGE. WE THEREFORE QUASH THE IMPUGNED REASSESSMENT AS WELL ON ACCOUNT OF THE AS SESSING OFFICERS FAILURE TO ADD LTCG WITHOUT INVOKING SECTION 2 ( 47 ) (V) OF THE ACT GOING BY STRICTER INTERPRETATION PRINCIPLE IN TAX PROCEEDINGS . 6. THIS REVENUES APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 8TH SEPT., 2021. SD/ - SD/ - (L .P. SAHU) (S.S. GODARA) ACCOUNTANT MEMBER JUDICIAL MEMBER HYDERABAD, DT. 08 .09 .2021. * REDDY GP COPY TO : 1. SRI GOTTIMUKKALA RAMA RAO, PLOT NO.817, VIVEKANANDA NAGAR COLONY, KUKATPALLY, HYDERABAD - 500 072 2. DCIT, CIRCLE 11(1), HYDERABAD. 3. PR. C I T - 5 , HYDERABAD. 4. CIT(APPEALS) - 7, HYDERABAD. 5. DR, ITAT, HYDERABAD. 6. GUARD FILE. BY ORDER SR. PVT. SECRETARY, ITAT, HYDERABAD.