Ramesh Chand Jain, Uttar Pradesh V. ITO, Shamli

ITA 807/DEL/2015

• Counselvise Citation: 80720114 RSA 2015
• Duration Of Justice: 7 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-09-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC 2
• Next Hearing Date: 11-08-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 10-02-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MRS RAKHI VIMAL
• Keywords: Sale consideration of property below Jantri Value
• Section: 143(3); 50C; 147; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES : SMC-2 NEW DELHI BEFORE SHRI J.SUDHAKAR REDDY ACCOUNTANT MEMBER ITA NO: 807/DEL/2015 ASSTT. YEAR : - 2009-10 RAMESH CHAND JAIN VS. ITO S/O SHRI JAI CHAND JAIN, WARD-1, JAIN MOHALLA, SHAMLI, SHAMLI. DISTT. SHAMLI, UTTAR PRADESH 247776 (PAN AAMPJ9915K) (APPELLANT) (RESPON DENT) APPELLANT BY : SHRI GAUTAM JAIN, ADVOCATE RESPONDENT BY :MRS. RAKHI VIMAL, JCIT DATE OF HEARING :11.8.2015 DATE OF PRONOUNCEMENT :11. 9.2015 O R D E R PER J.SUDHAKAR REDDY, ACCOUNTANT MEMBER THIS IS AN APPEAL FILED BY THE ASSESSEE DIR ECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS), MUZAFFARNAGAR DATED 17.11.2014 FOR THE ASSESSMENT YEAR 2009-10. 2. FACTS IN BRIEF : THE ASSESSEE IS AN INDIVIDUA L AND A SENIOR CITIZEN.THREE PLOTS OF LAND WAS SOLD BY THE ASSESSEE FOR THE TOTAL CONSIDE RATION OF RS. 14,77,000/- DURING THE ASSESSMENT YEAR 2009-10. THE NOTICE U/S 148 , D ATED 27.1.2011 WAS ISSUED TO THE ASSESSEE AND IN RESPONSE THE ASSESSEE FILED ITS RETURN OF INCOME ON 23.2.2011 DECLARING LONG TERM CAPITAL GAIN OF RS. 71,630/- AN D INCOME FROM OTHER SOURCES AT RS.10,601/-. NOTICE U/S 143(2) WAS ISSUED AND SCRUT INY ASSESSMENT WAS COMPLETED ITA NO. 807/DEL/2015 RAMESH CHAND JAIN VS. ITO 2 ON 21.12.2011 ACCEPTING THE INCOME RETURNED. DURING THE COURSE OF THESE ASSESSMENT PROCEEDINGS, THE AO HAD WRITTEN TO THE D EPARTMENTAL VALUATION OFFICER ON 2.9.2011, TO EVALUATE THE COST OF THE SAID THREE PLOTS OF LAND. 3. THE DEPARTMENTAL VALUATION OFFICER GAVE HIS VA LUATION REPORT ON 26.10.2012. BASED ON THIS DVOS REPORT, A NOTICE U/S 148 OF THE ACT WAS ISSUED FOR THE SECOND TIME ON 8.11.2012. THEREAFTER THE AO COMPLETED THE ASSESSMENT U/S 143(2) R.W.SECTION 147 BY INVOKING SECTION 50C AND DETERMI NING THE LONG TERM CAPITAL GAIN AT RS. 6,78,630/-. AGGRIEVED THE ASSESSEE CARRIED T HE MATTER IN APPEAL WITHOUT SUCCESS. FURTHER AGGRIEVED THE ASSESSEE IS BEFORE U S. 4. AFTER HEARING RIVAL CONTENTIONS WE ARE OF THE CONSIDERED VIEW THAT THE REOPENING IN QUESTION IS BAD IN LAW FOR THE REASON THAT THE A O HAS NOT OBTAINED THE MANDATORY APPROVAL OF THE JOINT/ADDITIONAL COMMISSIONER OF IN COME TAX U/S 151 OF THE ACT. THE HONBLE DELHI HIGH COURT IN THE CASE OF COMMISSIONE R OF INCOME-TAX VS. SPLS SIDDHARTHA LTD. (2012) 345 ITR 223 (DELHI) HELD AS FOLLOWS :- WHEN A STATUTE REQUIRES A THING TO BE DONE IN A CE RTAIN MANNER, IT SHALL BE DONE IN THAT MANNER ALONE AND THE COURT WOULD NOT E XPECT ITS BEING DONE IN SOME OTHER MANNER. SECTION 116 OF THE INCOME TAX AC T, 1961, DEFINES THE INCOME-TAX AUTHORITIES AS DIFFERENT AND DISTINCT AU THORITIES. SUCH DIFFERENT AND DISTINCT AUTHORITIES HAVE TO EXERCISE THEIR POWERS IN ACCORDANCE WITH LAW AS PER THE POWERS GIVEN TO THEM IN SPECIFIED CIRCUMSTA NCES. IF A STATUTORY AUTHORITY HAS BEEN VESTED WITH JURISDICTION, HE HAS TO EXERCISE IT ACCORDING TO ITS OWN DISCRETION. IF DISCRETION IS EXERCISED UNDE R THE DIRECTION OR IN COMPLIANCE WITH SOME HIGHER AUTHORITIES INSTRUCTION , THEN IT WILL BE A CASE OF FAILURE TO EXERCISE DISCRETION ALTOGETHER. HELD, THAT UNDER SECTION 151 OF THE ACT, IT WAS ONL Y THE JOINT COMMISSIONER OR ADDITIONAL COMMISSIONER, WHO COULD GRANT THE APPROV AL FOR ISSUE OF NOTICE UNDER SECTION 148. THE APPROVAL WAS NOT GRANTED BY THE JOINT COMMISSIONER. INSTEAD, IT WAS TAKEN FROM THE COMMISSIONER OF INCO ME-TAX. THIS WAS NOT AN IRREGULARITY CURABLE UNDER SECTION 292B. THE NOTICE WAS NOT VALID. ITA NO. 807/DEL/2015 RAMESH CHAND JAIN VS. ITO 3 HONBLE ALLAHABAD HIGH COURT IN THE CASE OF RELIABL E FINHOLD LTD. VS. UNION OF INDIA (2014) 369 ITR 419 (ALL) HELD AS UNDER :- REASSESSMENT NOTICE AFTER FOUR YEARS CONDITION PRECEDENT SATISFACTION OF COMMISSIONER OR CHIEF COMMISSIONER NO SANCTION OR PERMISSION OF COMMISSIONER OBTAINED- REASSESSMENT NOT VALID. 5. THUS REOPENING HAS TO BE HELD AS BAD IN LAW. 6. THE NOTICE U/S 148 OF THE ACT WAS ISSUED BY THE AO ORIGINALLY TO THE ASSESSEE ON THE VERY SAME ISSUE OF SALE OF THREE PLOTS OF LA ND. THE ASSESSMENT ORDER WAS PASSED U/S 143(3) R.W. SECTION 148 ON 21.12.2011. O N THE VERY SAME ISSUE, THE AO ISSUED ANOTHER NOTICE U/S 148, ON A CHANGE OF OPINI ON. BE AS IT MAY BE REOPENING WAS BASED ON THE REPORT OF THE DEPARTMENT VALUATION OFFICER. THIS ACTION CANNOT BE UPHELD IN VIEW OF THE DECISION OF THE HONBLE DELHI HIGH COURT IN THE CASE OF ACIT VS., DHARIYA CONSTRUCTION CO. (2010) 328 ITR 515 (S C) WHEREIN IT IS HELD AS FOLLOWS :- THE OPINION GIVEN BY THE DISTRICT VALUATION OFFICE R IS NOT PER SE INFORMATION FOR THE PURPOSE OF REOPENING AN ASSESSMENT UNDER SE CTION 147 OF THE INCOME- TAX ACT, 1961. 7. HENCE WE QUASH THE REOPENING PROCEEDINGS AND ALLOW THE APPEAL OF THE ASSESSEE. 8. IN THE RESULT APPEAL OF THE ASSESSEE IS A LLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 1 1 TH SEPTEMBER, 2015. SD/- (J. SUDHAKAR REDDY) ACCOUNTANT MEMBER DATED: THE 11 TH SEPTEMBER, 2015 ITA NO. 807/DEL/2015 RAMESH CHAND JAIN VS. ITO 4 VEENA COPY OF THE ORDER FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR 6. GUARD FILE BY ORDER DY. REGISTRAR SL. NO. DESCRIPTION DATE 1. DATE OF DICTATION BY THE AUTHOR 11.8.2015 2. DRAFT PLACED BEFORE THE DICTATING MEMBER 14.8.2 015 3. DRAFT PLACED BEFORE THE SECOND MEMBER 4. DRAFT APPROVED BY THE SECOND MEMBER 5. DATE OF APPROVED ORDER COMES TO THE SR. PS 6. DATE OF PRONOUNCEMENT OF ORDER 7. DATE OF FILE SENT TO THE BENCH CLERK 8. DATE ON WHICH FILE GOES TO THE HEAD CLERK 9. DATE OF DISPATCH OF ORDER