ITO, Kota V. PATEL AGARWAL & COMPANY, Kota

ITA 815/JPR/2013

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 9700 (ITAT-JAIPUR)
• Duration Of Justice: 3 year(s) 4 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-03-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2009-2010
• Appeal Filed On: 30-10-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PREM PRAKASH MEENA
• Assessee Lawyers: SATISH AJMERA C A DHK
• Keywords: Reopening of assessment; Sale consideration of property below Jantri Value; Additional evidence; Difference of opinion; Change of opinion
• Section: 50C; 147; 148; 144

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR JH HKKXPUN] YS[KK LNL; ,OA JH DQY HKKJR] U;KF;D LNL; DS LE{K BEFORE: SHRI BHAGCHAND, AM AND SHRI KUL BHARAT, JM VK;DJ VIHY LA- @ ITA NO. 815/JP/2013 FU/KZKJ.K O'K Z @ ASSESSMENT YEAR : 2009-10. THE INCOME TAX OFFICER, WARD 1(1), KOTA. CUKE VS. M/S. PATEL AGARWAL & COMPANY, THROUGH PARTNER SH. SUBHASH AGARWAL, 185, SHOPPING CENTRE, KOTA. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN NO. VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT JKTLO DH VKSJ LS@ REVENUE BY : SHRI PREM PRAKASH MEENA (JCIT) FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI SATISH AJMERA (CA) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 08.03.2017. ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 10 /03/2017. VKNS'K@ ORDER PER SHRI KUL BHARAT, J.M. THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF LD. CIT (A), KOTA, DATED 28.08.2013 PERTAINING TO ASSESSMENT YEAR 2009 -10. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, THE LD. CIT (A) HAS ERRED IN : (I) CANCELLING THE AOS ORDER U/S 147 FOR ASSESSING THE LONG TERM CAPITAL GAINS IN THE STATUS OF THE FIRM, IGNORING A LTOGETHER THE FACTS OF THE RELEVANT REGISTERED DEED, WHICH EXPLIC ITLY REFLECTED THAT THE PLOT IN QUESTION WAS IN POSSESSION OF THE FIRM UPTO 26.09.2008 I.E. DATE OF SALE ; (II) ACCEPTING THE ADDITIONAL EVIDENCE WITHOUT CALLING F OR ANY REMAND REPORT FROM THE ASSESSING OFFICER ; 2 ITA NO. 815/JP/2013 M/S. PATEL AGARWAL & COMPANY (III) THE APPELLANT CRAVES LIBERTY OF RAISE ADDITIONAL GR OUND AND TO MODIFY/AMEND THE GROUND OF APPEAL AT THE TIME OF HE ARING. 2. BRIEFLY STATED THE FACTS OF THE CASE ARE THAT TH E CASE OF THE ASSESSEE WAS PICKED UP FOR SCRUTINY ASSESSMENT AND THE ASSESSMEN T UNDER SECTION 144 READ WITH SECTION 147 OF THE INCOME TAX ACT, 1961 (HEREINAFT ER REFERRED TO AS THE ACT) WAS PASSED VIDE ORDER DATED 6 TH MARCH, 2013. WHILE FRAMING THE ASSESSMENT, THE AO COMPUTED THE INCOME BY INVOKING THE PROVISIONS OF S ECTION 50C OF THE ACT AT RS. 1,17,57,820/-. ON FURTHER APPEAL TO THE LD. CIT (A ), THE APPEAL OF THE ASSESSEE WAS ALLOWED AND THE ASSESSMENT ORDER WAS QUASHED ON THE GROUND THAT THE SAID NOTICE UNDER SECTION 148 WAS ISSUED AGAINST THE NON-EXISTI NG PERSON. 3. NOW THE REVENUE IS IN APPEAL BEFORE THIS TRIBUNA L. 4. THE ONLY EFFECTIVE GROUND IS AGAINST CANCELLING THE ASSESSMENT ORDER UNDER SECTION 147 OF THE ACT. 4.1. THE LD. D/R SUBMITTED THAT THE LD. CIT (A) WAS NOT JUSTIFIED IN CANCELLING THE ORDER. 4.2. ON THE CONTRARY, THE LD. COUNSEL FOR THE ASSES SEE SUBMITTED THAT ALL THE EVIDENCES WERE PLACED BEFORE THE AO AND IT WAS CONT ENDED THAT THE FIRM HAD ALREADY BEEN DISSOLVED. 4.3. WE HAVE HEARD RIVAL CONTENTIONS, PERUSED THE M ATERIAL AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELO W. WE FIND THAT THE LD. CIT (A) HAS GIVEN THE FINDING OF FACT BY OBSERVING AS UNDER :- FROM THE PERUSAL OF COPY OF ORDER SHEET IN THE C ASE OF SHRI SUBHASH AGARWAL, IT WAS SEEN THAT THE AO ASKED FOR DETAILS OF PROPERTY SOLD AND PURCHASED WITH SUPPORTING DOCUMENT. THE AO RECORDED ON THE ORDER 3 ITA NO. 815/JP/2013 M/S. PATEL AGARWAL & COMPANY SHEET THAT THE PROPERTY WAS PURCHASED ON 27.07.1996 IN CO-OWNERSHIP WITH SHRI MANI BHAI PATEL. IT WAS ALSO NOTED BY THE AO THAT COPY OF ALLOTMENT LETTER OF RIICO ALLOTTING PLOT IN JOINT N AME OF SHRI MANI BHAI PATEL AND SHRI SUBHASH AGARWAL WAS FURNISHED BY A/R OF SHRI SUBHASH AGARWAL. FROM THE ABOVE, IT IS CLEAR THAT THE ISSUE OF TAXIN G THE CAPITAL GAIN IN THE HANDS OF PARTNER WAS BEFORE AO AND HE H AD MADE DETAILED ENQUIRIES BEFORE CONCLUDING THE ASSESSMENT IN THE C ASE OF SHRI SUBHASH AGARWAL. WITHOUT GOING INTO THE OTHER ASPECTS OF THE CASE, T HE ISSUE IS DECIDED ON LEGAL GROUNDS ONLY. AS MENTIONED BY ME EARLIER, THE FIRM CEASED TO EXIS TS ON DEATH OF ONE OF THE PARTNERS AND, THEREFORE, NOTICE U/S 1 48 CANNOT BE ISSUED TO A NONE EXISTING PERSON. ONCE THIS FACT CAME TO K NOWLEDGE OF AO, HE SHOULD HAVE WITHDRAWN THE NOTICE AND SERVED IT ON T HE LEGAL REPRESENTATIVE OF THE DECEASED PARTNER AND THE SOLE SURVIVING PARTNER AS REPRESENTATIVE OF DISSOLVED FIRM. IT IS ALSO HELD THAT THE CAPITAL GAIN ARISING FROM ABOVE TRANSACTION WAS DISCLOSED IN THE HANDS OF PARTNER A ND WAS ENQUIRED INTO BY THE AO, THEREFORE, REOPENING OF ASSESSMENT IN THE CASE OF FIRM IS MERELY CHANGE OF OPINION (IT IS WORTH MENTIONING THAT THE AO OF ASSESSEE AND ITS PARTNER, SHRI SUBHASH AGARWAL IS S AME (ITO, WARD 1(1), KOTA). THEREFORE, THE REOPENING OF ASSESSMEN T IS ALSO HELD TO BE INVALID. THE VERY BASIS, ON WHICH THE ASSESSMENT ORDER WAS P ASSED, DID NOT SURVIVE. THEREFORE, ORDER U/S 147 IS CANCELLED. THE FINDING OF FACTS AS MENTIONED ABOVE, IS NOT CON TROVERTED BY THE REVENUE. THEREFORE, WE DO NOT SEE ANY REASON TO INTERFERE IN THE ORDER OF LD. CIT (A), SAME IS HEREBY AFFIRMED. THE GROUND OF THE REVENUE IS REJE CTED. 4 ITA NO. 815/JP/2013 M/S. PATEL AGARWAL & COMPANY 5. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D. ORDER PRONOUNCED IN THE OPEN COURT ON 10 /03/ 2017. SD/- SD/- ( HKKXPUN] ( DQY HKKJR ) (BHAG CHAND ) ( KUL BHARAT ) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER JAIPUR DATED:- 10/03/2017. D/ VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT- THE ITO WARD 1(1),KOTA. 2. THE RESPONDENT M/S. PATEL AGARWAL & COMPANY, K OTA. 3. THE CIT(A). 4. THE CIT, 5. THE DR, ITAT, JAIPUR 6. GUARD FILE (ITA NO. 815/JP/2013) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR 5 ITA NO. 815/JP/2013 M/S. PATEL AGARWAL & COMPANY