Andela Ramakrishna, Hyd, Hyderabad V. ITO, Ward-6(1), Hyd, Hyderabad

ITA 813/HYD/2016

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 6084 (ITAT-HYDERABAD)
• Duration Of Justice: 9 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-03-2017
• Appeal Filed By: Assessee
• Bench Allotted: B
• Assessment Year: 2005-2006
• Appeal Filed On: 31-05-2016
• Court: TRIBUNAL
• Department Lawyers: MOHAN REDDY
• Assessee Lawyers: S RAMA RAO
• Keywords: Sale consideration of property below Jantri Value; Opportunity of being heard; Principle of natural justice; Cost of acquisition
• Section: 50C; 147; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES B (SMC), HYDERABAD BEFORE SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER I.T.A. NO. 813/HYD/2016 ASSESSMENT YEAR: 2005-06 ANDELA RAMAKRISHNA, HYDERABAD [PAN: AJZPA7745E] VS INCOME TAX OFFICER, WARD-6(1), HYDERABAD (APPELLANT) (RESPONDENT) FOR ASSESSEE : SHRI S. RAMA RAO, AR FOR REVENUE : SHRI MOHAN REDDY, DR DATE OF HEARING : 06-03-2017 DATE OF PRONOUNCEMENT : 10-03-2017 O R D E R THIS IS AN APPEAL BY ASSESSEE AGAINST THE ORDER OF TH E COMMISSIONER OF INCOME TAX (APPEALS)-9, HYDERABAD D ATED 23-12-2015. ASSESSEE IS AGGRIEVED ON THE ORDER OF D IRECTION ISSUED BY THE CIT(A), AFTER ACCEPTING ASSESSEES CONTENTIONS W ITH REFERENCE TO THE STATUS IN WHICH THE INCOME IS TO BE ASSESSED. 2. THE APPEAL IS FILED WITH A DELAY OF 42 (FORTY TW O) DAYS. IN THE CONDONATION PETITION FILED, IT WAS SUBMITTED THAT ASSESSEE WAS SUFFERING FROM ENTERIC FEVER AND WAS UNDERGOING MED ICAL TREATMENT. HE HAS ENCLOSED THE CERTIFICATE FROM M/S. SADANAND NU RSING HOME, HYDERABAD DT. 29-05-2016. IT WAS SUBMITTED THAT THE APPEAL WAS TO BE FILED ON OR BEFORE 19-04-2016 AND THE APPEAL WAS FILED ON 31-05-2016 AFTER REMITTING THE APPEAL FEE ON 30-05-2016. IT WAS PRAYED THAT THE DELAY MAY BE CONDONED. AFTER CON SIDERING I.T.A. NO. 813/HYD/2016 ANDELA RAMAKRISHNA :- 2 - : THE OBJECTIONS FROM THE DR, I AM SATISFIED THAT THERE IS A SUFFICIENT CAUSE FOR FILING THE APPEAL BELATEDLY AND ACCORDINGL Y THE DELAY IN FILING THE APPEAL IS CONDONED AND APPEAL IS ADMITTED. 3. BRIEFLY STATED, ASSESSEE IS A MILK VENDOR AND ALON G WITH HIS FATHER AND THREE BROTHERS, SOLD A PROPERTY WHICH WAS H ELD IN JOINT OWNERSHIP. THE ENTIRE PROPERTY WAS SOLD FOR RS. 22 LAKHS AND ASSESSEES SHARE WAS 1/5 TH BEING 4,40,000/-. ASSESSING OFFICER (AO) ISSUED A NOTICE IN THE CAPACITY OF AN INDIVIDUA L AND ON THE LAST DAY OF TIME BARRING DATE, ASSESSEE FILED A NIL RETURN . AO HAS COMPLETED THE ASSESSMENT ON THE VERY SAME DAY. AO BROU GHT TO TAX AN AMOUNT OF RS. 9,08,902/- AS ASSESSEES SHARE OF P ROPERTY ADOPTING THE SRO VALUE. IT WAS THE CONTENTION OF ASSESS EE THAT PROPERTY BELONGS TO THE HUF, THE PROPERTY SOLD WAS NO T LAND OR BUILDING BUT TENANCY RIGHTS AND THE ADOPTION OF SRO VAL UE U/S. 50C DOES NOT ARISE IN ASSESSEES CASE. IT WAS ALSO C ONTENDED THAT THE INFORMATION RECEIVED FOR ISSUANCE OF NOTICE WAS TH AT AN AMOUNT OF RS. 46,15,635/- WAS INVESTED IN PURCHASE OF PROP ERTY, WHEREAS ASSESSEE HAS NOT INVESTED IN ANY PROPERTY BUT SOLD DU RING THE YEAR. AO ACCEPTED THE ABOVE CONTENTION BUT ON ISSUE O F SALE CONSIDERATION, HE ADOPTED THE SRO VALUE AND BROUGHT 1/5 TH OF ASSESSEES SHARE TO TAX. 4. BEFORE THE LD.CIT(A), ASSESSEE CONTENDED THAT THE CAP ITAL GAIN AROSE IN THE HANDS OF HUF AND AO INSPITE OF BRINGING IT TO HIS NOTICE DURING THE ASSESSMENT PROCEEDINGS, CHOSE TO A SSESS IN THE HANDS OF THE INDIVIDUAL ITSELF. THE SUBMISSIONS OF A SSESSEE WERE SENT TO THE AO ON REMAND. IN THE REMAND REPORT, AS MEN TIONED IN THE ORDER OF THE CIT(A) VIDE PARA 4.2, AO HAS ACCEPT ED THAT THE I.T.A. NO. 813/HYD/2016 ANDELA RAMAKRISHNA :- 3 - : TRANSACTION PERTAIN TO HUF AND NOT TO THE INDIVIDUAL. HO WEVER, THE AO TOOK THE STAND THAT ASSESSEE HAS NOT INFORMED THE SAM E DURING THE ASSESSMENT PROCEEDINGS AND THEREFORE, A DIRECTION MAY BE GIVEN U/S. 153(3) R.W.S. 150(2), TO ENABLE THE AO TO INITIATE THE PROCEEDINGS U/S. 147 IN THE HANDS OF ANDELA SATTAIAH, HUF AND ANDELA RAMAKRISHNA, HUF. LD.CIT(A) HAS ACCEPTED THE FINDINGS OF THE AO AND GAVE A DIRECTION TO BRING THE NECESSARY CAP ITAL GAINS TO TAX IN THE HANDS OF SHRI A. RAMAKRISHNA, HUF. THE O RDER OF THE LD.CIT(A) IS AS UNDER: 4.4. I HAVE CAREFULLY CONSIDERED THE ASSESSMENT OR DER, THE SUBMISSIONS OF THE ASSESSEE, THE FACTS OF THE CASE AND ALSO THE REMAND REPORT SUBMITTED BY THE ASSESSING OFFICER. I HAVE ALSO PERUSED THE SALE DEED IN QUESTION I.E. THE DEED DT. 18.12.2004 VIDE REGISTERED DEED NO. 223/2005 AND IT IS OBSERVED THAT AS AVERRED BY BOTH THE ASSESSEE AND THE ASSESSING OFFICER, THE SUBJECT PROPERTY SOLD IS HUF PROPERTY AND NOT INDIVIDUAL PROPERTY. THE ASSESSING OFFICER COMPLET ED THE ASSESSMENT IN INDIVIDUAL CAPACITY INSTEAD OF HUF CAPACITY AS THE ASSESSEE FILED RETURN OF INCOME ON 31.12.2007 BY TREATING THE SAID PROPERTY AS INDIVIDUAL PROPERTY. 4.5. FURTHER, THE ASSESSEES CONTENTIONS THAT WHAT WAS TRANSFERRED IS ONLY TERRACE RIGHTS AND NOT VACANT LAND IS NOT A DJUDICATED UPON AS THE ASSESSEE HAS NOT RAISED THIS ISSUE IN THE GROUNDS O F APPEAL. HOWEVER, SINCE THE SAID PROPERTY RELATES TO HUF AND NOT INDI VIDUAL, THE ASSESSMENT OUGHT TO HAVE BEEN MADE IN THE CAPACITY OF HUF. HE NCE, THE ADDITION MADE IN THE INDIVIDUAL CAPACITY IS NOT SUSTAINABLE AND IS HEREBY DELETED. BUT THE ASSESSING OFFICER IS DIRECTED TO TAKE NECES SARY ACTION IN BRINGING THIS INCOME TO TAX IN THE HANDS OF SRI A. RAMAKRISH NA, HUF. 5. ASSESSEE IS AGGRIEVED ON THE DIRECTION GIVEN BY THE CIT(A) AND NOT THE ISSUE ON WHICH ASSESSMENT HAS BEEN COMPLETED . ASSESSEE RAISED THE FOLLOWING GROUNDS: 1.THE ORDER OF THE LEARNED COMMISSIONER OF INCOME- TAX (APPEALS) IS ERRONEOUS TO THE EXTENT IT IS PREJUDICIAL TO THE AP PELLANT. I.T.A. NO. 813/HYD/2016 ANDELA RAMAKRISHNA :- 4 - : 2. THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) OUGHT TO HAVE SEEN THAT THERE IS NO GAIN WITH REFERENCE TO THE IMPUGNE D TRANSACTION AND THAT NO CAPITAL GAIN AROSE TO THE APPELLANT. 3. THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) OUGHT NOT TO HAVE DIRECTED THE ASSESSING OFFICER TO TAKE ACTION IN TH E CASE OF HUF PARTICULARLY WHEN NO INCOME ESCAPED ASSESSMENT EVEN IN THE ASSES SMENT OF THE HUF. 4. THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) OUGHT TO HAVE HELD THAT NO CAPITAL GAIN AROSE TO THE APPELLANT. 5. THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) OUGHT TO HAVE HELD THAT THE CONSIDERATION AND THE COST OF ACQUISITION WERE NOT CORRECTLY ADOPTED BY THE ASSESSING OFFICER. 6. THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) OUGHT TO HAVE SEEN THAT THE DIRECTION TO ASSESS THE INCOME IN ANOTHER CASE CANNOT BE GIVEN BY THE APPELLATE AUTHORITY AND THAT SUCH A DIRECTION I S NOT LEGALLY VALID. 7. ANY OTHER GROUND THAT MAY BE URGED AT THE TIME O F HEARING. 6. LD. COUNSEL IN THE COURSE OF ARGUMENT HAS ONLY REF ERRED TO GROUND NO. 3 AND GROUND NO.6, WHEREAS THE OTHER GROUN DS ARE NOT REQUIRED TO BE ADJUDICATED IN THIS ASSESSEES CASE. IT WAS THE CONTENTION THAT LD.CIT(A) COULD NOT HAVE GIVEN A DIRECTI ON TO ASSESSEE IN ANOTHER STATUS, WHO IS NOT A PARTY BEFORE THE LD.CIT(A) AND NO OPPORTUNITY WAS GIVEN BEFORE ISSUING SUCH DI RECTION. HE RELIED ON THE DECISION OF CO-ORDINATE BENCH OF ITAT, MUMBAI BENCH IN THE CASE OF VIJAY KUMAR SARDA VS. DCIT [146 ITD 553] (MUMBAI- TRIB). 7. LD.DR, HOWEVER, SUBMITTED THAT IT WAS ASSESSEE OFFER ED THE INCOME IN THE INDIVIDUAL CAPACITY AND AO HAS ACCEPTE D THE SAME. THEREFORE, IT IS NOT PROPER ON THE PART OF ASSESSEE TO C ONTEND THAT IT SHOULD NOT HAVE BEEN ASSESSED IN THE HANDS OF THE IND IVIDUAL. FURTHER, HE REFERRED TO THE PROVISIONS OF SECTION 150 A ND 153 TO I.T.A. NO. 813/HYD/2016 ANDELA RAMAKRISHNA :- 5 - : SUBMIT THAT THE DIRECTION OF THE CIT(A) IS VALID ON THE FACTS OF THE CASE. FOR A QUERY WHETHER ANY OPPORTUNITY WAS GIVEN TO THAT ASSESSEE, BEFORE ISSUING DIRECTION PERTAINING TO A THIR D PARTY, IT WAS SUBMITTED THAT ASSESSEE HIMSELF IS REPRESENTING HUF ALSO THEREFORE, IT IS TO BE CONSIDERED AS DEEMED OPPORTUNIT Y. 8. I HAVE CONSIDERED THE SUBMISSIONS AND PERUSED THE DOCUMENTS ON RECORD. FIRST OF ALL, THE INFORMATION REC EIVED BY THE AO THAT ASSESSEE HAS INVESTED AN AMOUNT OF RS. 46,15, 635/- ITSELF IS NOT CORRECT. INSPITE OF HAVING THE INFORMATION AND THE SALE DEED, AO CHOSE TO ASSESS THE SAME IN THE HANDS OF ASSESSEE-I NDIVIDUAL, WHEREAS THE PROPERTY WAS SOLD BY ASSESSEE-HUF. THIS FACT WAS ALSO ACCEPTED BY THE AO IN THE COURSE OF REMAND PROCE EDINGS BEFORE THE LD.CIT(A). TO THAT EXTENT, THE FINDINGS OF TH E LD.CIT(A) GIVEN IN PARA 4.4 HAVE BECOME FINAL. REVENUE IS NO T IN APPEAL ON THAT ISSUE. THEREFORE, THE ASSESSMENT DONE BY THE AO ON THE MERITS DOES NOT STAND AS OF NOW. 9. THE ONLY ISSUE IS WHETHER THE LD.CIT(A) CAN ISSUE A DIRECTION TO ASSESS TO TAX THE AMOUNT IN THE HANDS OF A. RAMAKRISHN A, HUF? IN MY VIEW, THE DIRECTION IS NOT VALID. THERE ARE CER TAIN TIME LIMITS PRESCRIBED FOR ISSUANCE OF A NOTICE U/S. 148, WHICH IS GOVERNED BY THE PROVISIONS OF SECTION 149. THE ASSESSMENT YEAR IN VOLVED BEING 2005-06, THE REOPENING CANNOT BE DONE, IF SIX YEARS H AVE LAPSED FROM THE END OF THE RELEVANT ASSESSMENT YEAR. THE ASSE SSMENT CAN BE REOPENED FOR AY. 2005-06 ON OR BEFORE 31-03-2012 . THIS DIRECTION GIVEN BY THE CIT(A) WAS DATED 23-12-2015. BY THAT TIME THE DIRECTION WAS GIVEN, THE TIME LIMITS FOR INITIATION O F PROCEEDINGS HAVE ALREADY LAPSED. NOT ONLY THAT, AS PER EXPLANA TION 3 TO SECTION I.T.A. NO. 813/HYD/2016 ANDELA RAMAKRISHNA :- 6 - : 153 (PRIOR TO ITS AMENDMENT W.E.F. 01-06-2016), THE CIT(A) COULD NOT HAVE ISSUED ANY SUCH DIRECTION WITHOUT GIVING AN O PPORTUNITY OF BEING HEARD TO SUCH OTHER PERSON BEFORE THE SAID OR DER WAS PASSED. IN THIS CASE, SHRI A. RAMAKRISHNA-INDIVIDUA L IS ENTIRELY DIFFERENT FROM A. RAMAKRISHNA-HUF. INCOME TAX ACT TR EATS THEM AS SEPARATE PERSON. EVEN THOUGH HUF IS REPRESENTE D BY SHRI A. RAMAKRISHNA, STILL AS PER LAW, SHRI A. RAMAKRISHNA- HUF IS SUCH OTHER PERSON WITHIN THE MEANING OF THE EXPRESSION PRO VIDED IN EXPLANATION 3. AS SEEN FROM THE RECORD, THE CIT(A) HA S NOT GIVEN ANY OPPORTUNITY TO SUCH OTHER PERSON BEFORE A DIRECTI ON WAS GIVEN. THEREFORE, THE DIRECTION GIVEN VIOLATES NOT ONLY THE PR OVISIONS OF LAW BUT ALSO THE PRINCIPLES OF NATURAL JUSTICE. THE DIRECTI ON CANNOT BE UPHELD ON THESE REASONS. 10. IN THE CASE OF VIJAY KUMAR SARDA VS. DCIT [146 I TD 553] (MUMBAI-TRIB) (SUPRA), THE CO-ORDINATE BENCH AT MUMBAI HAS CONSIDERED SIMILAR DIRECTION AND HELD AS UNDER: 8.WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSI ONS AND PERUSED THE RECORD. UNDER SECTION 251 OF THE INCOME TAX ACT THE FIRST APPELLATE AUTHORITY HAS THE POWERS TO CONFIRM, REDUCE, ENHANCE OR ANNUAL THE AS SESSMENT. HE CAN ALSO INITIATE PENALTY PROCEEDINGS AND IN ANY OTHER CASE HE MAY PA SS SUCH ORDERS IN THE APPEAL AS HE THINKS FIT. THE EXPRESSION MAY PASS SUCH ORDERS IN THE APPEAL WAS SUBJECT MATTER OF CONSIDERATION BY VARIOUS COURTS. WHILEDEC IDING THE APPEAL THE APPELLATE AUTHORITY MAY GIVE APPROPRIATE DIRECTIONS TO THE AO EITHER IN REGARD TO THE ASSESSEE IN APPEAL BEFORE HIM OR OTHERWISE. HOWEVER, THESE D IRECTIONS CANNOT TRAVEL OUTSIDE THE ASSESSMENT YEAR TO WHICH THE APPEAL RELATES. IN THE SAME WAY THE DIRECTIONS CANNOT RELATE TO A THIRD PERSON, WHOSE APPEAL IS NO T PENDING BEFORE HIM. THE POLICY OF LAW IS THAT THERE MUST BE A POINT OF FINALITY IN ALL LEGAL PROCEEDINGS, THAT STALE ISSUES SHOULD NOT BE REACTIVATED BEYOND A PARTICULA R STAGE, AS OBSERVED BY THE HON'BLE APEX COURT IN THE CASE OF PARASHURAM POTTER Y WORKERS CO. LTD. 106 ITR 1 AT PAGE 10. IN THE INSTANT CASE NO ADDITION WAS MADE I N THE HANDS OF SMT. KALPANA VIJAY SARDA THOUGH SHE HAS FILED THE RETURN BY SPEC IFYING THAT SHE HAS PURCHASED THE PROPERTY. AT THE SAME TIME IT IS NOT IN DISPUTE THA T THE AO HAS TAKEN A CONSISTENT STAND THAT A SUM OF RS.16,51,000/- WAS PAID FOR PUR CHASE OF THE SAID PROPERTY BUT CONSCIOUSLY TOOK A VIEW THAT SHE HAS NO WHEREWITHAL TO MAKE SUCH PAYMENT AND HENCE NO ADDITION CAN BE MADE UNDER SECTION 69A OF THE ACT. THIS FINDING HAS BECOME FINAL AND THIS WAS NOT IN DISPUTE BEFORE THE APPELLATE AUTHORITY. IN THE APPEAL FILED BY THE ASSESSEES HUSBAND THE ONLY ISS UE WAS AS TO WHETHER HE PAID A I.T.A. NO. 813/HYD/2016 ANDELA RAMAKRISHNA :- 7 - : SUM OF RS.16,51,000/- TO THE TENANT ON BEHALF OF HI S WIFE AND IT IS NOT THE CASE OF EITHER THE AO OR THE ASSESSEE THAT THE PAYMENT WAS MADE BY ASSESSEES WIFE. SUCH BEING THE CASE, AN ISSUE WHICH IS NOT BEFORE THE FI RST APPELLATE AUTHORITY CANNOT BE SUBJECT MATTER OF CONSIDERATION WHILE DISPOSING OF AN APPEAL, IN EXERCISE OF THE POWERS VESTED IN THE FIRST APPELLATE AUTHORITY UNDE R SECTION 251 OF THE INCOME TAX ACT. IN THE CASE OF A.B. PARIKH VS. INCOME TAX OFFI CER 203 ITR 186 THE HON'BLE GUJARAT HIGH COURT HAD CONSIDERED IDENTICAL ISSUE W ITH REGARD TO EXTENSION OF TIME LIMIT BY VIRTUE OF PROVISIONS OF SECTION 150(1) OF THE INCOME TAX ACT AND IN THAT REGARD THE COURT OBSERVED THAT IN ORDER TO ISSUE SU CH DIRECTIONS, WHICH WOULD AMOUNT TO ENHANCING THE ASSESSMENT OF A THIRD PARTY , SUCH PERSON MUST HAVE BEEN PUT ON NOTICE, AS OTHERWISE, IT IS NOT PERMISSIBLE TO GIVE SUCH DIRECTION. THE FIRST INGREDIENT IS THAT THERE MUST BE A FINDING THAT THE INCOME EXCLUDED FROM THE TOTAL INCOME OF ONE PERSON IS THE INCOME OF ANOTHER PERSO N. THE SECOND INGREDIENT IS THAT THE ORDER MUST BE ONE WHICH HAS COME TO BE PASSED A FTER THE OTHER PERSON WAS GIVEN AN OPPORTUNITY OF BEING HEARD. THE PERSON CON CERNED MUST BE PUT ON NOTICE THAT THE CONSEQUENCE OF THE INCOME BEING HELD AS HE R INCOME IS LIKELY TO ADVERSELY AFFECT HER TAX LIABILITY. 9.IN THE INSTANT CASE THE LEARNED CIT(A) HAS NOT CA LLED FOR ANY RECORD EITHER FROM THE AO OR FROM THE AFFECTED PARTIES BEFORE COMING TO TH E CONCLUSION AS TO WHY THE ALLEGED PAYMENT WAS MADE FROM THE UNDISCLOSED SOURC ES OF INCOME, MORE PARTICULARLY WHEN THE AO WAS FIRMLY OF THE OPINION THAT SHE WOULD NOT HAVE BEEN IN A POSITION TO PAY SUCH HUGE AMOUNT SINCE SHE HAD NO O THER INCOME TO MAKE SUCH PAYMENT. THE EXPRESSION MAY BE DEEMED TO BE THE IN COME UNDER SECTION 69A OF THE ACT IMPLIES THAT EVEN AFTER COMING TO THE CONCL USION THAT A SUM OF RS.16,51,000/- WOULD HAVE BEEN PAID FOR SURRENDER O F TENANCY RIGHTS IT IS NOT AUTOMATIC THAT SUCH ADDITION SHOULD BE MADE UNDER S ECTION 69A OF THE ACT UNLESS IT IS SHOWN THAT SHE WAS CAPABLE OF HAVING SO MUCH OF INCOME IN THE YEAR UNDER CONSIDERATION. THE FIRST APPELLATE AUTHORITY HAS NO T MADE ANY COMMENT IN THAT REGARD AND, IN FACT, HAS NOT GIVEN ANY OPPORTUNITY TO SMT. KALPANA VIJAY SARDA, WHICH SHOWS THE FALLACY IN THE DIRECTION GIVEN BY H IM. 10.IN THE CASE OF MRS. BANOO E. COWASJI 138 ITR 686 THE HON'BLE INDORE BENCH OF THE MADHYA PRADESH HIGH COURT OBSERVED THAT THERE W AS NO PROVISION OF LAW UNDER WHICH THE CIT(A), WHILE DECIDING AN APPEAL PREFERRE D BY THE ASSESSEE, CAN PASS ORDERS WITH REGARD TO ASSESSMENTS MADE BY THE AO IN THE CASE OF A THIRD PARTY. 11.IN THE CASE OF PEICO ELECTRONICS AND ELECTRICALS LTD. 210 ITR 991 THE HON'BLE CALCUTTA HIGH COURT OBSERVED THAT THOUGH THE POWERS OF THE FIRST APPELLATE AUTHORITY ARE CO-TERMINUS WITH THAT OF THE AO AND HAS POWERS TO ENHANCE THE ASSESSMENT BUT THAT IS CONFINED TO THE ASSESSEE AND A FINDING OR D IRECTION, WHILE DISPOSING OF THE APPEAL, MUST BE A FINDING NECESSARY FOR GIVING RELI EF IN RESPECT OF THE ASSESSMENT YEAR IN QUESTION. IN OTHER WORDS, THE CONCLUSION RE ACHED BY THE AO IN THE CASE OF A THIRD PARTY SHOULD NOT BE DISTURBED WITHOUT GIVING SUCH ASSESSEE AN OPPORTUNITY OF BEING HEARD AND WHEN IT IS NOT A NECESSARY FINDING OR DIRECTION IN THE CASE OF THE ASSESSEE WHOSE APPEAL IS PENDING AND THE ISSUE THER EIN IS SUBJECT MATTER OF DISPUTE BEFORE THE CIT(A). 12.IN THE CASE OF CIT VS. BANWARI LAL & SONS P. LTD . 257 ITR 518 AT PAGE 522 THE HON'BLE DELHI HIGH COURT APPROVED THE FINDINGS OF T HE APPELLATE TRIBUNAL BY OBSERVING AS UNDER: BEFORE CLOSING, WE WOULD LIKE TO SAY A WORD ABOUT THE DIRECTION OF THE LEARNED APPELLATE ASSISTANT COMMISSIONER TO THE INC OME-TAX OFFICER TO I.T.A. NO. 813/HYD/2016 ANDELA RAMAKRISHNA :- 8 - : BRING THE AMOUNT IN QUESTION TO TAX UNDER THE HEAD INCOME FROM HOUSE PROPERTY IN THE RESPECTIVE ASSESSMENT YEARS TO WHI CH THE INCOME RELATES. THIS DIRECTION OF THE LEARNED APPELLATE AS SISTANT COMMISSIONER HAS TO BE CONSTRUED IN THE LIGHT OF THE DECISION OF THE SUPREME COURT IN THE CASE OF RAJINDERNATH V. CIT [1979] 120 ITR 14. IT WAS NOT AT ALL NECESSARY FOR THE DISPOSAL OF THE ASSESSEES APPEAL FOR THIS YEAR TO GIVE SUCH A DIRECTION AND, THEREFORE, THE SAME COUL D NOT BE TREATED AS A DIRECTION GIVEN BY THE LEARNED APPELLATE ASSISTAN T COMMISSIONER AS CONTEMPLATED IN SECTION 153(3)(II). IT DESERVES TO BE NOTICED THAT THE EXPRESSION IN C ONSEQUENCE OF OR TO GIVE EFFECT TO ANY FINDING OR DIRECTION CONTAINED IN AN ORDER UNDE R SECTION 250.. IS AKIN TO THE EXPRESSION USED IN SECTION 150(1) I.E. ANY FINDING OR DIRECTION CONTAINED IN AN ORDER PASSED BY ANY AUTHORITY IN ANY PROCEEDING UNDER THI S ACT BY WAY OF AN APPEAL. IN OTHER WORDS, IN ORDER TO EXTEND THE TIME LIMIT UNDE R SECTION 148 OF THE ACT, BY TAKING AID OF SECTION 150 OR 153OF THE ACT, THE FIRST APPE LLATE AUTHORITY HAS TO TAKE INTO CONSIDERATION THE FACT THAT THE FINDING OR DIRECTIO N SHOULD BE RELEVANT FOR THE SUBJECT MATTER OF DISPUTE AND, WHEN IT AFFECTS A THIRD PART Y, PRINCIPLES OF NATURAL JUSTICE DEMANDS THAT SUCH THIRD PARTY SHOULD HAVE BEEN GIVE N AN OPPORTUNITY AS OTHERWISE SUCH DIRECTION DESERVES TO BE SET ASIDE AS INVALID. 13.SIMILAR VIEW WAS TAKEN BY THE ITAT HYDERABAD BEN CH IN THE CASE OF PENNAR ELECTRONICS P. LTD. 308 ITR (AT) 192. AT PAGE 203 T HE ITAT HYDERABAD BENCHES HAD TAKEN SUPPORT OF THE VIEW TAKEN BY THE HON'BLE PATN A HIGH COURT IN THE CASE OF GAURI SHANKAR CHOUDHARY 234 ITR 865 TO OBSERVE THAT RESOR T TO SUB-SECTION (1) OF SECTION 150 OF THE ACT CAN BE TAKEN ONLY IN CASES WHERE IT BECOMES NECESSARY TO MAKE ASSESSMENT OR REASSESSMENT OR RECOMPUTATION AND SUC H DIRECTION MUST RELATE TO THE ASSESSEE IN QUESTION AND NOT ANY DIRECTION OR ASSES SMENT MADE IN APPEAL, REFERENCE OR REVISION OR ANY OTHER ASSESSEE OR ANY PROCEEDING S IN WHICH THE ASSESSEE IN QUESTION IS NOT A PARTY. THUS, ON A CONSPECTUS OF T HE MATTER, WE ARE OF THE FIRM VIEW THAT THE DIRECTION GIVEN BY THE FIRST APPELLATE AUT HORITY UNDER SECTION 150(1) IS NOT IN ACCORDANCE WITH LAW. WE ORDER ACCORDINGLY. 11. BOTH ON FACTS AS WELL AS ON PRINCIPLES OF LAW, TH E DIRECTION GIVEN BY THE CIT(A) IS NOT SUSTAINABLE. SINCE THE CIT (A) HAS NOT ADJUDICATED WHETHER THE PROVISIONS OF SECTION 50C CAN B E INVOKED IN A CASE A TRANSFER OF TENANCY RIGHTS, BUT NOT A LAND AND BUILDING, I AM ALSO NOT ADJUDICATING THAT ISSUE, EVEN THOUGH ASSESSE E HAS RAISED THE GROUNDS, THAT CAPITAL GAINS HAS NOT BEEN CORR ECTLY WORKED OUT. SINCE THE TAXATION OF CAPITAL GAINS IN THE HANDS OF ASSESSEE-INDIVIDUAL HAS BECOME FINAL BY THE ORDER OF CIT(A), THERE IS NO NEED TO ADJUDICATE THE OTHER GROUNDS. GROUND NOS . 3 AND 6 I.T.A. NO. 813/HYD/2016 ANDELA RAMAKRISHNA :- 9 - : ARE ACCORDINGLY ALLOWED AND THE DIRECTION GIVEN BY THE CIT(A) IN THE LAST SENTENCE OF THE ORDER IN PARA 4.5 IS SET ASIDE. 12. IN THE RESULT, APPEAL OF ASSESSEE IS CONSIDERED P ARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 10 TH MARCH, 2017 SD/- (B. RAMAKOTAIAH) ACCOUNTANT MEMBER HYDERABAD, DATED 10 TH MARCH, 2017 TNMM COPY TO : 1. ANDELA RAMAKRISHNA, HYDERABAD. C/O. SRI S. RAMA RAO, ADVOCATE, FLAT NO. 102, SHRIYAS ELEGANCE, 3-6 -643, STREET NO. 9, HIMAYAT NAGAR, HYDERABAD. 2. THE INCOME TAX OFFICER, WARD-6(1), HYDERABAD. 3. COMMISSIONER OF INCOME TAX(APPEALS)-9, HYDERABAD . 4. THE PR. COMMISSIONER OF INCOME TAX-6, HYDERABAD. 5. D.R. ITAT, HYDERABAD. 6. GUARD FILE.