Asstt. CIT cir. 2 Nasik, Nashik V. Dyshyant (Bigger) Gopal Naik HUF,

ITA 81/PUN/2009

• Counselvise Citation: [2010] 135 COUNSELVISE.COM (IT) 3273 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 8 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-09-2010
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2005-2006
• Appeal Filed On: 16-01-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANJU AJWANI
• Section: 143(3); 54EC

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES B, PUNE BEFORE SHRI SHAILENDRA KUMAR YADAV, JM AND SHRI D. KARUNAKARA RAO, AM I.T.A. NO. 81/PN/2009: ASSTT. YEAR 2005-06 ASSTT. CIT CIR. 2, NASIK APPELLANT VS. DUSHYANT (BIGGER) GOPAL NAIK HUF 1893 TIWANDHA CHOWK, NASIK PAN AABHN 6422 L RESPONDENT APPELLANT BY : SMT. MANJU AJWANI RESPONDENT BY: NONE ORDER PER SHAILENDRA KUMAR YADAV, JM THIS APPEAL HAS BEEN FILED BY THE REVENUE AGAINST THE ORDER OF THE CIT(A)-II NASIK DATED 17-10-2008 ON TH E POINT OF DELETION OF ADDITION OF RS. 21,80,000/- ALLOWING EX EMPTION U/S 54EC OF THE ACT. 2. THE ASSESSEE IS A HUF. DURING THE ASSESSMENT PROCEEDINGS U/S 143(3) FOR THE YEAR UNDER CONSIDERA TION, THE A.O DISALLOWED EXEMPTION CLAIMED UNDER THE PROVISIO NS OF SECTION 54EC OF THE ACT. IN APPEAL, THE CIT(A) GRA NTED RELIEF AFTER CONSIDERING THE CONTENTIONS RAISED ON BEHALF OF THE ASSESSEE. ITA NO. 81/PN/2008 DUSHYANT (BIGGER) GOPAL NAIK HUF A.Y. 2005-06 , 2 3. DURING THE YEAR UNDER CONSIDERATION, THE ASSESSE E SOLD A PROPERTY BEARING PLOT NO. 28, SURVEY NO. 465 FOR A CONSIDERATION OF RS. 23,00,000/- AND INVESTED THE S AID SUM IN NABARD CAPITAL GAIN BONDS AND CLAIMED EXEMPTION U/S 54EC OF THE ACT. THE SAID TRANSACTION TOOK PLACE A S PER THE DEVELOPMENT AGREEMENT DATED 28-6-2004 AND THE SAID BONDS WERE PURCHASED ON 12-2-2005. THE CIT(A) ON PERUSAL OF THE DEVELOPMENT AGREEMENT OBSERVED THAT IT DOES NOT GIV E THE DETAILS OF POSSESSION OF THE PROPERTY. THE VALIDIT Y OF THE AGREEMENT IS FOR A PERIOD OF 9 MONTHS AND THE LAST INSTALLMENT OF THE CONSIDERATION WAS RECEIVED ON 7-2-2005. THE POSSESSION WAS HANDED OVER ON 12-1-2005 AND IT WAS DOCUMENTED ON KABJA PAVATI THIS DOCUMENT WAS SIG NED BY BOTH THE PARTIES ALONG WITH TWO WITNESSES. THEREFO RE, THE POSSESSION DOCUMENT COULD NOT HAVE BEEN REJECTED BY THE A.O AS NOT A VALID EVIDENCE. THE A.O ALSO FAILED TO BR ING ANY MATERIAL ON RECORD TO ESTABLISH THAT EITHER THE POS SESSION WAS GIVEN BEFORE THE SAID DATE OR PROVED THAT THE POSSE SSION WAS GIVEN AS PER THE DEVELOPMENT AGREEMENT. THE A.O SI MPLY REJECTED THE KABJA PAVATI. AS PER THE DETAILED S UBMISSIONS AND PERUSAL OF THE DEVELOPMENT AGREEMENT, THE CIT(A ) OBSERVED THAT THERE WAS NO PASSING OF OR TRANSFERRI NG OF COMPLETE CONTROL OVER THE PROPERTY IN FAVOUR OF THE DEVELOPER IN THE INSTANT CASE, HENCE THERE WAS NO TRANSFER AS PE R THE SAID DEVELOPMENT AGREEMENT AS ON 28-6-2004. THUS, CONSI DERING ITA NO. 81/PN/2008 DUSHYANT (BIGGER) GOPAL NAIK HUF A.Y. 2005-06 , 3 THE FACTS AND CIRCUMSTANCES OF THE CASE, THE CIT(A) OBSERVED THAT THE A.O WAS NOT JUSTIFIED TO STATE THAT THE TR ANSFER TOOK PLACE ON 28-6-2004 AS PER THE DEVELOPMENT AGREEMENT SINCE IT WAS NOT COUPLED WITH POSSESSION. EVEN AS PER THE A GREEMENT, THE LAST CONSIDERATION WAS RECEIVED ON 7-2-2005 BEF ORE THE VALIDITY OF THE AGREEMENT AND THE POSSESSION WAS GI VEN ONLY ON 12-1-2005. TAKING THE DATE OF POSSESSION AS PER TH E DOCUMENT FURNISHED ON BEHALF OF THE ASSESSEE, THE C IT(A) RIGHTLY OBSERVED THAT INVESTMENT IN NABARD CAPITAL GAIN BONDS MADE BY THE ASSESSEE WAS WITHIN THE PRESCRIBE D TIME OF THE PROVISIONS OF SECTION 54EC OF THE ACT. THEREFO RE, THE DISALLOWANCE OF EXEMPTION MADE BY THE A.O WAS NOT J USTIFIED AND THE SAME WAS RIGHTLY DELETED BY THE CIT(A). WE UPHOLD THE SAME. 4. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. PRONOUNCED IN THE OPEN COURT ON 24 TH SEPTEMBER 2010. SD/- SD/- (D. KARUNAKARA RAO) (SHAILENDRAKUMAR YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBER PUNE,DATED THE 24 TH SEPTEMBER 2010 ANKAM COPY FORWARDED TO: (1) ASSESSEE (2) DEPARTMENT (3) CIT- I NASIK (4) CIT(A)-II NASIK (5) THE D.R. B BENCH, PUNE TRUE COPY BY ORDER, ASSISTANT REGISTRAR ITA NO. 81/PN/2008 DUSHYANT (BIGGER) GOPAL NAIK HUF A.Y. 2005-06 , 4 INCOME-TAX APPELLATE TRIBUNAL, PUNE BENCHES, PUNE