ITO, Jaipur V. POOJA AGARWAL, Jaipur

ITA 84/JPR/2013

• Counselvise Citation: 8423114 RSA 2013
• Duration Of Justice: 1 year(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-01-2014
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2008-2009
• Appeal Filed On: 28-01-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SUBHASH CHANDRA
• Assessee Lawyers: R K JAIN; PRAVEEN SARASWAT
• Keywords: Capital asset; Gift; Salary income; Principle of natural justice
• Section: 234B

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL JAIPUR BENCH, JAIPUR (BEFORE SHRI HARI OM MARATHA AND SHRI N.K. SAI NI) ITA NO. 84/JP/2013 ASSESSMENT YEAR : 2008-09 PAN: AFRPA 2680 Q THE ITO VS. MS. POOJA AGARWAL WARD- 3(2) D-5A, MEERA MARG, JAIPUR BANI PARK, JAIPUR (APPELLANT) (RESPONDENT) ITA NO.927/JP/2012 ASSESSMENT YEAR : 2008-09 PAN: AFRPA 2680Q MS . POOJA AGARWAL VS. THE ACIT D-5A, MEERA MARG CIRCLE- 3 BANI PARK, JAIPUR JAIPUR (APPELLANT) (RESPONDENT) DEPARTMENT BY: SHRI SUBHASH CHANDRA ASSESSEE BY : SHRI PRAVEEN SARASWAT & SHRI R .K. JAIN DATE OF HEARING: 22-01-2014 DATE OF PRONOUNCEMENT: 31-01-2014 ORDER PER HARI OM MARATHA, JM:- THESE ARE THE CROSS APPEALS PERTAINING TO ASSESSME NT YEAR 2008-09, HAVING BEEN FILED AGAINST THE ORDER OF THE LD. CIT( A)-I, JAIPUR DATED 07-11- 2012. 2.1 THE REVENUE HAS RAISED THE FOLLOWING GROUND I N ITS APPEAL:- 2 WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT(A) WAS JUSTIFIED IN DEL ETING THE ADDITION OF RS. 14,30,009/- MADE BY THE AO ON ACCOU NT OF DISALLOWANCE OF EXPENDITURE. 2.2 THE ASSESSEE HAS RAISED FOLLOWING GROUNDS IN HE R APPEAL:- 1. THE LD. CIT(A) HAS ERRED IN UPHOLDING WRONG DISTANCE REPORTS PREPARED BY THE INCOME-TAX INSPECT ORS AND IGNORING THE DISTANCE CERTIFICATES ISSUED BY THE LA ND REVENUE AUTHORITIES, SUCH AS PATWARI, SARPANCH ETC. AND LAN D SURVEYOR FOR THE AGRICULTURE LAND AT VILLAGE NAGAL SUSAVATAN FOR THE PURPOSE OF SECTION 2(14)(III). THE INSPECTORS AND M EASURED THE DISTANCE WITHOUT ASCERTAINING THE CORRECT MUNICIPAL LIMITS AND ACTUAL LOCATION OF THE IMPUGNED LAND SOLD BY THE AS SESSEE, ACCORDINGLY WRONGLY SUSTAINED IMPUGNED ADDITION MAD E BY AO ON THIS SCORE. 2. THE LD. CIT(A) HAS ERRED IN CONSIDERING THE REMA ND REPORT OF THE ASSESSING OFFICER, IN PURSUANCE TO RU LE 46A WHO HAD FAILED TO EXAMINE THE ELABORATE MAP BY A QUALIF IED LAND SURVEYOR AND A GOOGLE MAP OF DISTANCE BETWEEN MUNIC IPAL LIMIT AND IMPUGNED LAND. THE ASSESSING OFFICER ALSO DID NOT PHYSICALLY VERIFY THE DISTANCE, WHILE REJECTING THE SURVEYORS REPORT AND IGNORED THE REQUEST OF THE ASSESSEE TO V ERIFY THE DISTANCE OF THE SAID LAND IN ASSESSEE'S PRESENCE FO R CORRECT IDENTIFICATION OF THE IMPUGNED LAND OR WITH THE HEL P OF THE REVENUE AUTHORITIES. 3. THE LD. CIT(A) HAS ERRED IN ACCEPTING THE REMAND REPORT UNDER RULE 46A BY A LOWER AUTHORITY I.E. INCOME-TAX OFFICER ON AN ORDER UNDER APPEAL ISSUED BY SUPERIOR AUTHORITY I.E. ASSTT. COMMISSIONER OF INCOME-TAX. 4. THE INTEREST CHARGED U/S 234B & C HAS WRONGLY BE EN CALCULATED AND CHARGED. 3.1 BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT THE ASSESSEE, AS INDIVIDUAL, DERIVES INCOME FROM SALARY, INTEREST AND OTHER SOUR CES. FOR ASSESSMENT YEAR 3 2008-09, SHE FILED HER RETURN OF INCOME ON 12-02-20 09 DECLARING TOTAL INCOME OF RS. 13,96,980/- FROM INTEREST AND OTHER SOURCES. THE CAPITAL ACCOUNT OF THE ASSESSEE WAS EXAMINED AND IT WAS NO TICED BY THE AO THAT AN AMOUNT OF RS. 6,38,40,000/- HAS BEEN CREDITED IN T HE LAND ACCOUNT. AN AMOUNT OF RS. 10.00 LACS IS ALSO FOUND CREDITED AS GIFT RECEIVED. THE ASSESSEE WAS CALLED UPON TO EXPLAIN BOTH THESE CREDITS. IT W AS EXPLAINED THAT THE CREDIT OF LAND WAS IN RESPECT OF GAIN DERIVED ON SALE OF A PIECE OF AGRICULTURAL LAND SITUATED ON DELHI ROAD TO QUALITY RESORTS & HOSPIT ALITY LTD., MUMABI, AND ABOUT GIFT IT HAS BEEN RECEIVED FROM HER MATERNAL UNCLE. SHE HAS SUPPORTED THE LAND A/C WITH THE COPIES OF PURCHASE DEED AND S ALE-DEEDS. TO SUPPORT GIFT, SHE HAS PRODUCED AN AFFIDAVIT OF HER MATERNAL UNCLE FROM WHOM SHE HAS CLAIMED TO HAVE RECEIVED THIS GIFT AMOUNT. HOWEVER, BEING NOT SATISFIED, THE AO PROPOSED TO CHARGE NET CONSIDERATION RECEIVED FR OM SALE OF LAND AS A CAPITAL GAIN. THIS MOVE OF THE AO WAS OBJECTED B Y THE ASSESSEE STATING THAT THE LAND SOLD BEING AGRICULTURAL LAND AND SITU ATED OUTSIDE THE STATED LIMITS OF 8 KM FROM THE MUNICIPAL TERRITORY AS DEF INED IN SECTION 2(14)(III)(B) OF THE ACT AND THE SAME IS EXEMPT FRO M ANY TAX UNDER THE ACT. IN SUPPORT OF HER CONTENTION, SHE HAS FILED A CERTI FICATE OBTAINED FROM THE SARPANCH OF GRAM PANCHAYAT, KUKAS. SHE ALSO FILED A CERTIFICATE AFTER OBTAINING IT FROM THE PATWARI OF THE VILLAGE IN CON FIRMATION OF THE CLAIM MADE BY HER. THE AO HAS DEPUTED HIS INSPECTOR TO MA KE SPOT ENQUIRIES AND 4 AFTER OBTAINING REPORT HIM, THE AO HAS TREATED THIS LAND AS A CAPITAL ASSET. AS PER THE INSPECTORS REPORT, THE LAND IN QUESTION IS SITUATED WITH 8 KM FROM THE MUNICIPAL LIMITS OF AMER MUNICIPALITY AND JAIPUR MUNICIPALITY. THE AO EXAMINED THE REPLY OF THE ASSESSEE FILED VID E LETTER DATED 23-12- 2010 AND ALSO THE CERTIFICATE DATED 18-07-208 ISSUE D BY THE SARPANCH OF THE GRAM PANCAYAT, KUKAS AND THE LETTER DATED 25-03-201 0 ISUED BY THE HALKA PATWARI (VILLAGE REVENUE OFFICER). THE AO AGREED WI TH THE REPORT OF HIS INSPECTOR AND HAS TREATED THE LAND SOLD AS A CAPIT AL ASSET. THEREFORE, THE BENEFIT CLAIMED BY THE ASSESSEE HAS BEEN DENIED. TH E LAND WAS PURCHASED BY THE ASSESSEE ON 20-11-207 FROM SHRI PRADEEP BHATI, SHRI H.P. CHOUDHARY AND SHRI G.C. AGARWAL FOR A TOTAL CONSIDERATION OF RS. 54,72,000/-. THIS LAND HAS BEEN SOLD ON 22-12-2007 FOR A TOTAL CONSIDERATI ON OF RS. 6,93,12,000/- WHICH HAS BEEN TREATED AS THE INCOME OF THE ASSESSE E OF THIS YEAR AND HAS BEEN ADDED IN HER HANDS. 3.2 AGGRIEVED, THE ASSESSEE FILED AN APPEAL BEFORE THE LD. CIT(A) WHO HAS CONFIRMED THE ADDITION. 3.3 THE ASSESSEE IS FURTHER AGGRIEVED AND FILED AN APPEAL BEFORE US. THE REVENUE HAS ALSO FILED AN APPEAL BEFORE US. 3.4 WE HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE CA REFULLY PERUSED THE ENTIRE RECORD. BEFORE US, BOTH THE PARTIES HAVE REI TERATED THEIR EARLIER STANDS. THE ASSESSEE HAS SOLD A PIECE OF AGRICULTURAL LAND. THE AO HAS NOT DISPUTED 5 THE FACT. RATHER, HE HAS ACCEPTED THAT THE NATURE O F THE LAND SOLD IS AGRICULTURAL ONLY. SECTION 45 OF THE ACT PRESCRIBES THAT ANY PROFIT OR GAIN ARISING FROM THE TRANSFER OF CAPITAL ASSET EFFECTED IN THE PREVIOUS YEAR SHALL, SAVE AS OTHERWISE PROVIDED IN THE SECTIONS 54,54B, 54D ETC. SHALL BE DEEMED TO BE THE INCOME OF THE PREVIOUS YEAR IN WHICH THE TRANSFER TOOK PLACE. THE DEFINITION OF A CAPITAL ASSET IS SUPPLIED BY THE SUB-SECTION 14 OF SECTION 2 OF THE ACT. SECTION 2 (14) OF THE ACT READS AS UND ER:- (III) AGRICULTURAL LAND IN INDIA, NOT BEING LAND SITUATE - (A) IN ANY ARE AREA WHICH IS COMPRISED WITHIN THE JURISDICTION OF A MUNICIPALITY BEFORE THE FIRST DAY OF THE PREVIOUS YEAR. (B) IN ANY AREA WITHIN SUCH DISTANCE, NOT BEING MORE THAN EIGHT KILOMETERS FROM THE LOCAL LIMITS OFANY MUNICIPALITY OR CANTONMENT BOARD REFERRED TO IN ITEM (A), AS THE CENTRAL GOVERNMENT MAY, HAVING REGAD TO THE EXTENT OF, AND SCOPE FOR, URBANISATION OF THAT AREA AND OTHER RELEVANT CONSIDERATIONS, SPECIFY IN THIS BEHALF BY NOTIFICATION IN THE OFFICIAL GAZETTE. THUS, IT BECOMES CLEAR FROM THE VERY PLAIN READING OF THE ABOVE PROVISION OF SECTION 2(14)(III) THAT EVEN AGRICULTURAL LAND CAN BE TREATED AS A CAPITAL ASSET AND CONSEQUENTLY CAPITAL GAIN CAN BE CHAR GED ON THE NET CONSIDERATION ARISING FROM THE SALE OF THAT LAND IF THE LAND SOLD FALLS WITHIN 8KM FROM THE LOCAL LIMIT OF ANY MUNICIPALITY OR CAN TONMENT BOARD ETC. AS 6 MENTIONED THEREIN. NOW, THE ONLY QUESTION WHICH WE ARE REQUIRED TO DECIDE AS TO WHETHER THIS AGRICULTURAL PIECE OF LAND SOLD BY THE ASSESSEE FALLS WITHIN THE PURVIEW OF SECTION 2(14)(III)(B) OF THE ACT OR NOT. IF IT DOES THEN CAPITAL GAIN IS CHARGEABLE OTHERWISE NOT. THE AO PUT THE A SSESSEE TO THE TASK OF PROVING THAT THE AGRICULTURAL LAND SOLD IS NOT FALL ING WITHIN THE ABOVE STATED 8KM. THE ASSESSEE PRODUCED THE FOLLOWING PROOF IN S UPPORT OF HER CLAIM:- (1) A COP OF THE CERTIFICATE DATED 18-07-2008 ISSUE D BY THE SARPANCH OF THE GRAM PANCHAYAT, KUKAS; A COPY OF TH IS CERTIFICATE IS ENCLOSED AT PB-1. THIS CERTIFICATE H AS BEEN ISSUED BY THE SARPANCH OF THE SAME VILLAGE WHEREIN THE REV ENUE ESTATE OF THE SOLD LAND IS SITUATED. ( 2) A LETTER FROM THE HALKA PATWARI OF THE SAME VILLAGE. AS IS REVEALED FROM THE PAGE 4 OF THE AOS ORDER, H E HAS DISCARDED BOTH THE ABOVE MOT RELEVANT PIECES OF EVIDENCE. NO OTHER AUT HORITY THAN THE SARPANCH AND PATWARI OF THE SAME VILLAGE CAN BE SO AUTHENTIC TO STATE AND CERTIFY THAT THE SOLD LAND IS SITUATED AT A DISTANCE OF MORE THA N 8 KM FROM THE LOCAL LIMITS OF THE RELATED MUNICIPALITY ETC. SURPRISINGL Y, THE AO HAS RELIED ON A REPORT OF HIS INSPECTOR. THIS REPORT WAS NEVER CONF RONTED TO THE ASSESSEE. WE HAVE FOUND THE ASSERTION OF LD. AR THAT THE AO DID NOT REQUIRE FROM THE ASSESSEE TO FILE ANY FURTHER PROOF. THE REPORT OF T HE INSPECTOR WAS OBTAINED BEHIND THE BACK OF THE ASSESSEE. THE AO DID NOT AND SHOULD NOT HAVE DEMANDED ANY FURTHER PROOF FROM THE TEHSILDAR OR TH E JAIPUR MUNICIPAL CORPORATION AS THE SARPANCH AND THE HALKA PATWARI A RE SUCH AUTHORITIES WHO 7 ARE MORE INTIMATELY CONNECTED WITH THE POSITION OF THEIR AGRICULTURAL REVENUE AREA. THUS, THE ACTION OF THE AO IS UNCALLED FOR AN D DESERVES TO BE DEPRECATED. NOW COMING TO THE ORDER OF THE LD. CIT( A), TO SATISFY THE EX- PARTE OBSERVATIONS OF THE AO, THE ASSESSEE PRODUCED EVEN THE REPORT OBTAINED FROM JAIPUR MUNICIPAL CORPORATION WAS FILED BEFORE HIM UNDER THE PROVISIONS OF RULE 46A OF THE INCOME TAX RULES. THI S REPORT HAS ALSO BEEN CERTIFIED AND CONFIRMED THE REPORT OF THE SARPANCH AND THE HALKA PATWARI THAT THIS LAND IS SITUATED BEYOND 9 KM FROM THE LOC AL LIMITS OF THIS MUNICIPAL CORPORATION. THE LD. CIT(A) MOVED ONE STEP FURTHER AND SUMMONED THE REVENUE OFFICER OF THE JAIPUR MUNICIPAL CORPORATION AND RECORDED HIS STATEMENT. SHRI DINESH PAREEK, THE REVENUE OFFICER, CONFIRMED THAT HE HAD HIMSELF ISSUED THIS CERTIFICATE. HOWEVER, HE WAS EX AMINED AGAIN AND AGAIN. HE MADE A CONTRADICTORY STATEMENT WHEN HE WAS CALLE D TIMES. HIS STATEMENTS WERE PUT TO THE ASSESSEE AND THE LD. AR RELIED AS UNDER :- 3. THE FOLLOWING IS INTER-ALIA SUBMISSION OF ASSESSEE IN VIEW OF INFORMATION COLLECTED BY YOUR HONOUR REGARDING CLAIM OF ASSESSEE: 3.1 THE STATEMENTS GIVEN BY REVENUE OFFICER OF JAIPUR NAGAR NIGAM ON VARIOUS DATES (WHO HAS ISSUED CERTIFICATES OF MUNICIPAL LIMITS ON 06/07/2011) ARE CONTRADICTORY AND WITHOUT ANY PROPER EVIDENCE ON RE CORD. SO SAME ARE NOT ACCEPTABLE IN TOTO. 8 3.2 THE FIRSTS STATEMENT RECORDED ON 02/12/2011 WAS NOT IN PRESENCE OF ASSESSEES COUNSEL. IN THAT STATEMENT IN ANSWER NO. 3 SHRI DINESH KUMAR PAREEK HAS ADMITTED THAT CERTIFICATE DATED 06/07/2011 WAS ISSUED WITH HIS SIGNATURE. FURTHER IN ANSWER NO. 5 HE HAS STATED THAT NAGAR NIGAM, AMER ZONE WAS CONSTITUTED IN APRI L, 2008. THE MAP OF 2009 WAS ALSO GIVEN BY SHOWING WARDS 74, 75,76 & 77 OF JAIPUR NAGAR NIGAM. BUT IN ANSWER NO. 6 HE HAS STATED THATJ PHYSICAL VERIFICAT ION OF LAND WAS NOT MADE BY HIM AND CERTIFICATE WAS GIVEN ON BASIS OF EVIDENCES ON RECORD, SUCH AS SARPANCH AND PATWARI CERTIFICATES. NOW I WILL DO PHYSICAL VERIF ICATION WITH PATWARI ALSO. 3.3 IN SECOND STATEMENT DATED 21/02/2012 HE WAS AGAIN BITTERLY CONFUSED AND NARRATED TWISTED AN D INCORRECT FACTS WITHOUT ANY EVIDENCE ON RECORD. A) IN ANSWER NO.3 MR. PAREEK HAS STATED THAT PHYSICAL VERIFICATION HA S BEEN DONE ON 07/02/2012 WITH APPOINTED INSPECTORS OF INC OME-TAX DEPARTMENT MR. PURSHOTTAM SHARMA & RAMJI LAL MEENA. THIS OBSERVATION IS BASE-LESS AS THEY HAVE VERIFIED THE SO CALLED LAND PHYSICALLY FROM THE ALLEGED PURANI CHUN GI CHOWKI, KUNDA AMER AND THE DISTANCE, ACCORDING TO ABOVE LIM ITS COMES 6I.2 & 7 KM RESPECTIVELY, WHILE THEY SHOULD HAD TAK EN THE DISTANCE FROM THE LIMITS OF JAIPUR NAGAR NIGAM, PRE VAILING AT THE TIME OF SALE OF LAND. IT SEEMS THAT LIMITS OF JAPIR NAGAR NIGAM IS NOT CLEAR TO THEM. B) THE INSPECTOR APPOINTED, SHRI PURSHOTTAM SHARMA HAD EARLIER GIVEN REPORT TO AO ON 24/12/2010 (APB-24) I N WHICH HE HAD MENTIONED THAT FROM AMER CHUNGI NAKA DISTANCE O F LAND IS 3.50 KM AND ON THE BASIS OF THIS REPORT, AO HAS MAD E HUGE ADDITION AND SAID SHRI PURSHOTTAM SHARMA, INSPECTOR AND REVENUE OFFICER OF NAGAR NIGAM WITHOUT IDENTIFYING THE LIMITS 9 OF JAIPUR NAGAR NIGAM AND LAND IN QUESTION HAS TAKE N THE ABOVE DISTANCE. THE CONCLUSION OF REPORT IS:- AFTER MEASUREMENT, THE ACTUAL DISTANCE BETWEEN DELH I ROAD, JAIPUR (LAND OF MRS. POOJA AGARWA) FROM PURAN I CHUNGI IS FOUND AS 6.2 KM AND ACCORIDING TO NEW JURISDICTI ON OF JAIPUR MUNICIPAL CORPORATION, ITS DISTANCE FOUND AS 7 KM. THE INSPECTION REPORT GIVEN BY SHRI PURSHOTTAM SHAR MA DATED 07/02/2012 AGAIN HAS NO EVIDENTIAL VALUE AND LACKS RELIABILITY. THE SAME CANNOT BE USED AGAINST THE A SSESSEE. AS PER REVENUE OFFICER, JAIPURS MUNICIPAL CORPORAT ION LIMITS ENDS BEFORE 8 KM FROM PURANI CHUNGI, AMER, J AIPUR. THUS BOTH THESE REPORTS ARE CONTRADICTORY AND HAVIN G NO EVIDENTIAL VALUE, BECAUSE IT SEEMS THAT INSPECTOR S HRI PURSHOTTAM SHARMA STILL WAS NOT AWARE ABOUT THE COR RECT LIMITS OF JAIPUR MUNICIPAL CORPORATION AND LOCATION OF THE LAND OF ASSESSEE. C) IN ANSWER NO.4 REVENUE OFFICER HAS NARATED THE STORY OF LAND WITHIN 8 KM OF JAIPUR MUNICIPAL CORPO RATION FROM PURANI CHUNGI, CHOWKI WITHOUT KNOWING LOCATION OF THE LAND OF ASSESSEE. THE EARLIER CERTIFICATES WERE BA SED ON THE CERTIFICATES OF OTHER REVENUE AUTHORITIES. SO THIS AVERMENT IS NOT ACCEPTABLE. D) IN CROSS EXAMINATION REVENUE OFFICER, JAIPUR NAGAR NIGAM (AMER) HAS STATED IN ANSWER NO.1 THAT A REA COMES IN WARD NO. 77, BUT UNABLE TO EXPLAIN FULL LI MITS FROM MAP. E) IN ANSWER NO.2 OF CROSS EXAMINATION ACCORDING TO NOTIFICATION DATED 18/04/1992 THROUGH WHICH REVENUE VILLAGES OF AREA OF AMER NAGAR PALIKA HAS BEEN INCLUDED IN J AIPUR NAGAR PALIKA HAS STATED THAT VILLAGE NANGAL SUSAWATAN WHE RE LAND OF ASSESSEE IS SITUATED IS NOT APPEARING, BECAUSE THIS NOTIFICATION IS OF 1992. 10 THIS NOTIFICATION IS APPLICABLE AS THROUGH THIS VER Y NOTIFICATION. AMER NAGAR PALIKA AND ITS REVENUE VI LLAGES HAS BEEN INCLUDED IN JAIPUR MUNICIPAL CORPORATION, IN W HICH VILLAGE WHERE LAND OF ASSESSEE WAS SITUATED IS NOT APPEARIN G. THE SUBSEQUENT NOTIFICATIONS I.E. 25/09/1994 IS FOR DIS TRIBUTION OF WARDS, WHERE IN OLD AMER MUNICIPAL AREA HAS COME IN WARD NO. 53, SUBSEQUENTLY THROUGH NOTIFICATION 17/02/2009, T HIS AREA HAS BEEN DISTRIBUTED IN WARD NO. 74,75, 76 & 77. HENCE THAT NOTIFICATION WAS APPLICABLE. SO VILLAGE WHICH ARE WITHIN 8 KM OF MUNICIPAL LIMITS OF JAIPUR/ AMER ARE CLEARLY MEN TIONED IN THIS NOTIFICATION AND NAME OF VILLAGE WHERE ASSESSE ES LAND IS SITUATED IS NOT APPEARING IN THIS NOTIFICATION. TH US LAND IS OUT OF 8 KM FROM MUNICIPAL LIMITS OF JAIPUR. F) ON RE-CROSS EXAMINATION BY YOUR HONOUR IN ANSWER NO. 1 OFFICER HAS STATED VIDE NOTIFICATION D ATED 18/04/1992. THEREAFTER AGAIN REVENUE OFFICER WAS NOT SATISFIED WITH HIS OWN STATEMENT REGARDING CORRECT DISTANCE OF LAN D. SO HE HAS TAKEN TIME UP TO 28/02/2012. BUT NO CROSS EXAMINATION BY AR OF THE ASSESSEE WAS ALLOWED TO INSPECTOR. 3.3 IN STATEMENT DATED 11-03-2012 OF REVENUE OFFICE R (NOT IN PRESENCE OF ASSESSEES COUNSEL) IN ANS. NO. 1 & 2 OF THE REVENUE OFFICER HAS ADMITTED THAT THERE WAS NO CHAN GE IN OUTER LIMITS OF JAIPUR NAGAR NIGAM THROUGH NOTIFICATION D ATED 25-09/- 1994 AND 17/2/2009. THEREFORE, MAP (2009) IS GIVEN FINAL. FURTHER REVENUE OFFICER HAS STATED THAT LAND IN QUE STION IN2007-08 & 2008-09 FROM PURANI CHUNGI CHOWKI, KUNDA,AMER 6.2 KM AND FROM KUNDA,AMER IS AT A DISTA NCE OF 7KM. IN ANSWER NO. 5 REVENUE OFFICE HAS STATED THAT IN 2 77-08 THE LAND WAS 6.2KM (IT WAS FROM PURANI CHUNGI KUNDA ). 11 THUS IN ALL THESE 3 TRANSACTIONS THE REVENUE OFFICE R COULD NOT SATISFACTORY EXPLAINED OR PIN-POINT THE A REA FROM WHERE MEASUREMENT HAS TO BE TAKEN OR FROM WHERE IS THE CORRECT LIMIT OF MUNICIPAL LIMIT OR WHERE IS THE LAND, BECA USE BOTH OF THEM (REVENUE OFFICER AND INSPECTOR OF DEPARTMENT) ARE NOT AWARE THE FACTS. THEY HAVE TAKE N THE MEASUREMENT FROM PURANI CHUNGI CHOWKI, KUNDA, WHICH IS NOT CORRECT. 4. THE ASSESSEE HAS PRODUCED ALL THE RELEVANT EVIDE NCES I.E. REVNEU RECORD IN SUPPORT OF THE LAND SITUATED AT VILLAGE NANGAL SUSAVATAN, TEHSIL AMER, DISTT. JAIPUR ALONGW ITH CERTIFICATES OF I REVENUE AUTHORITIES OF VILLAGE OF JUSTIFYING THAT LAND IS BEYOND 8 KM DISTANCE FROM THE MUNICIPAL LIM IT. NOWHERE IN LAW, IT IS PROVIDED THAT CERTIFICATES FR OM MUNICIPAL COMMISSIONER IS BINDING OR MANDATORY. THE ASSESSEE HAS ALSO PROVIDED THE SAME AS PER REQUIREMENT OF AO ASKED DU RING THE COURSE OF ASSESSMENT PROCEEDINGS. THE ENQUIRY MADE ON THAT CERTIFICATES IS ALSO NOT F RUITFUL AS CONTRADICTORY FINDINGS HAS COME OUT. THE REPORT OF INSPECTOR CONERNED IS ALTOGETHER NOT CONSIDERABLE AS HE IS NO T AWARE ABOUT THE CORRECT POSITION OF LAND AND ITS MEASUREMENT ET C. SINCE VERY BEGINNING. 5. THE ASSESSEE IS REGULARLY STATING CATEGORICALLY THT LAND IN QUESTION IS BEYOND 8 KM OF JAIPUR NAGAR, NIGAM L IMITS, EVEN IN NOTIFICATATION DATED 18-04-1992 VILLAGES, W HICH ARE WITHIN 8 KM OF MUNICIPAL LIMIT ARE MENTIONED AND TH E NAME OF VILLAGE WHERE THE LAND OF THE ASSESSEE IS SITUATED DOES NOT APPEAR IN THIS NOTIFICATION. SO THIS NOTIFICATION A LSO SUPPORTS THE CLAIM OF ASSESSEE AS HELD IN ITA NO.1572/JP/2008 DA WTED 13- 01-2001 BY HONBLE ITAT BENCH IN CASE OF SMT. PRATI BHA GOYAL. THE FURTHER INTER ALIA FOLLOWING SUBMISSION IS AL SO MADE TO CLARIFY THE AMBIGUITY WHICH HAS ARISEN FROM THE STATEMENTS OF NAGAR NIGAM REVENUE OFFICER AND INSPECTOR CONCERNED OF DEPARTMENT. 12 5.1 THAT WITH ALL THE PROLONGED DISCUSSION AND EVIDENCES ON RECORD IT IS ESTABLISHED THT LAND OF A SSESSEE IS SITUATED IN VILLAGE NANGAL SUSAVATAN. BUT DUE TO ST ATEMENTS GIVEN BY REVNUE OFFICER OF NAGAR NIGAM, JAIPUR (AME R ZONE) AND MEASUREMENT TAKEN BY HIM AND INSPECTOR ARE NOT CORECT, AS THEYHAVE TAKEN MEASUREMNT FROM ALLEGED PURANI CHUNG I CHOWKI, AMER, WHICH IS NOT CORRECT POINT OF LIMITS. HOW THEY ARE IDENTIFYING PURANI CHUNGI CHOWKI, AMER AND HOW THEY ARE TAKING THE PLACE FROM WHERE THEY A RE SAYING THAT LAND IS 6.2 KM BEST KOWN TO THEM, THEY HAVE NO T PROVIDED ANY EVIDENCE ON RECORD, SIMPLY BY GIVING ONLY CONTR ADICTORY STATEMENTS AND REPORTS. THE PHOTOS IN (ANNEXURE A,B) ARE ENCLOSD IN WHICH IS MENTIONED FROM SAID CHUNGI CHOWKI DISTANCE OF LAND OF ASSESSEE IS 10.9 KM, WHICH IS STILL VERIFIABLE. 5.2 IN PRODUCED MAP LF NAGAR NIGAM, JAIPUR, THE LIM ITS OF WARD N. 77 OF NAGAR NIGAM ETC. ALSO APPEARING. A DETAILED MAP (ANNEXURE C) OF SAID WARD IS ENCLOSED, WHICH S HOWS THE CLEAR LIMITS FOR LAND OF ASSESSEE. IN DETAILED MAP, YOU WILL FIND A PLACE MARKED B (NEAR SHYAM DOONGRI COLONY) WHERE L IMITS OF SAID WARD TOUCHED THE JAIPUR DELHI ROAD AND CLEAR LY LIMITS IS APPEARING IN ITS FROM THIS PLACE LAND OF ASSESSEE I S8.2 KM. SO ASSESSEE'S LAND IS 10.9 KM FROM CHUNGI CHOWKI AN D 8.2 KM FROM THE LIMITS APPEARING IN MAP OF WARD NO. 77. THE (ANNEXURE-D) IS ALSO ENCLOSED FOR ITS CERTIFICATION . THUS ASSESSEE'S LAND FROM BOTH THE ANGLES IS BEYOND 8 KM OF LIMITS OF JAIPUR NAGAR NIGAM. AN AFFIDAVIT OF ASSESSEE IS ALSO ENCLOSED FOR ABOVE CORRECT POSITION OF LAND (ANNEXU RE-E) 5.3 IT ALSO SEEMS THAT REVENUE OFFICER OF NAGAR NIG AM AND INSPECTORS CONCERNED HAVE NOT FOLLOWED THE MEAS UREMENT PROCEDURE I.E. AS PER THE ROAD DISTANCE AND NOT AS PER STRAIGHT LINE DISTANCE ON A HORIZONTAL PLAIN OR OTHERWISE AS HELD IN (2010) 229 CTR 32 (PUNJ. & HARYANA H.C.) IN CASE OF CIT VS. 13 SATINDERPAL SINGH FOLLOWED LANKIK DEVELOPERS VS. DC IT, 105 ITD 657, MUMBAI. 5.4 A CERTIFICATE FROM SHRI MANGAL CHAND KUMAWAT, ARCHITECT IS ALSO ENCLOSED WHICH CERTIFIES THE ABOV E DISTANCE (ANNEXURE F). AN ATTESTED MAP FROM HIM TAKEN FROM GOOGLE EARTH WORK GPS SYSTEM IS ALSO ENCLOSED WHICH ALSO CERTIFI ES ABOVE DISTANCE (ANNEXURE G) SO CLAIM OF ASSESSEE IS CORRECT AS THE FACTS EMERGE S FROM ABOVE EVIDENCES ON RECORD. HENCE, ADDITION MADE ON THIS SCORE MAY KINDLY BE DELETED. ADMITTEDLY, THE ASSESSEE WAS NOT ALLOWED OPPORTUNIT Y TO CROSS EXAMINE. THIS IS AGAINST PRINCIPLES OF NATURAL JUSTICE. THIS STAT EMENT CANNOT BE RELIED ON. THE LD. CIT(A) HAS MENTIONED THAT HE HAS NOT RELIED ON THE STATEMENT OF SHRI DINESH PAREEK DATED 02-02-2011. HOWEVER, HIS VERSIO N HAS REALLY IMPRESSED HIS DECISION MAKING FACULTY IN ONE WAY OR THE OTHER . IT IS NOTICED THAT ALLEGED PHYSICAL VERIFICATIONS WHICH ARE NOT BASED ON ANY S CIENTIFIC MANNER AND NOT DONE BY AN EXPERT IN THE FIELD GIVE DIVERGENT OPINI ON. THEREFORE, THESE VERIFICATIONS CANNOT BE RELIED UPON. THE BEST EVIDE NCE IN THE FORM OF REPORTS OF THE SARPANCH, THE HALKA PATWARI AND EVEN THE MUN ICIPAL CORPORATION, JAIPUR (IN THE FIRST INSTANCE) ARE EMPHATIC AND ARE RELIABLE. THEREFORE, WE ARE LEFT WITH NO OPTION BUT TO ACCEPT THEM AS CORRECT W HEN THESE ARE PITTED AGAINST THE VARIANT STATEMENTS WHICH IN OUR CONSIDE RED OPINION DO NOT SEEM TO BE DEVOID OF FEARLESSNESS OR FAIRLESSNESS. THE O VERWHELMING EFFECT OF THE 14 FOLLOWING EVIDENCE SPEAKS IN THE FAVOUR OF THE ASSE SSEE. THESE PIECES OF EVIDENCE ARE AS UNDER:- 1. THE CERTIFICATES FROM PATWARI, SARPANCH AND JAIP UR NAGAR NAGAM WHICH ARE ENCLOSED AT PAGES 1, 5, AND 7 OF T HE ASSESSEE'S PAPER BOOK. ALL THESE REVENUE AUTHORITIES HAVE CERT IFIED THAT THE DISTANCE OF THE LAND SOLD IS 9 KM FROM THE LIMI T OF CONCERNED MUNICIPALITY OR NAGAR NIGAM ETC. 2. A CERTIFICATE FROM A QUALIFIED SURVEYOR WHO HAS WORKED OUT THE DISTANCE OF LAND SOLD FROM THE LOCAL MUNICI PAL LIMITS/ MUNICIPAL CORPORATION/ NOTIFIED AREA COMMITTEE ETC. THE SURVEYOR HAS CALCULATED THE DISTANCE AT 8.2 KMS ON THE BASIS OF GPS OF GOOGLE EARTH. THE CERTIFICATE IS ALSO ENCLOS ED WITH THE R REPORTS. 3. COPIES OF MAP OF JAIPUR NAGAR NIGAM WITH A VIEW TO IDENTIFYING THE MUNICIPAL LIMITS AND KHATONI/ JAMAB ANDI OF LAND. 4. COPY OF NOTIFICATION DATED 18-04-1992 ISSUED BY THE STATE GOVT. STATING THAT THIS LAND IS NOT INCLUDE T HE LAND IN THE VILLAGE FALLING UNDER JURISDICTION OF JAIPUR MUNICI PAL AREA. THIS NOTIFICATION HAS BEEN APPROVED AS VALID DOCUMENT FO R IDENTIFYING THE MUNICIPAL LIMIT BY THE ITAT JAIPUR BENCH IN THE CASE OF PRATIBHA GOYAL. 5. THE ASSESSEE SUBMITTED HER OWN AFFIDAVIT TO CERT IFY THE DISTANCE OF MORE THAN 8 KMS FROM LOCAL LIMIT OF MUN ICIPALITY. THE ABOVE OVERWHELMING PIECES OF EVIDENCE WHICH ARE AVAILABLE ON RECORD AND FILED BY THE ASSESSEE TO SUPPORT HER CLAIM, CAN NOT BE DOUBTED BY THE INSPECTORS REPORT. ACCORDINGLY, WE HOLD THAT THE P IECE OF LAND SOLD WAS ONLY AGRICULTURAL LAND WHICH DOES NOT GIVE RISE TO ANY C APITAL GAIN. THE FOLLOWING DECISIONS SUPPORT THE ABOVE VIEWS. 15 1. CIT VS. LAL SINGH, 195 TAXMAN 420 (P&H)( COPY ENCLOSED AT PAGE 67 TO 71 OF APB 2. ASHOK KUMAR AGARWAL, ITAT JAIPUR XLUT.W.P.112 (COPY ENCLOSED AT PAGES 72 TO 74 OF APB) 3. ITO VS. ASHOK SHUKLA, 28 TAXMAN 111 (INDORE) (COPY ENCLOSED AT PAGES 75 TO 79 OF APB) 4. SMT. (DR.) SUBHA TRIPATHI VS. DCIT, CIRCLE- 6, JAIPUR , CBDT NOTIFICATION N. 9447 DATED 6-01- 1994, ITAT JAIPUR BENCH (COPY ENCLOSED AT PAGES 80 TO 83 OF APB) 5. SMT. PRATIBHA GOYAL, ITAT JAIPURM, ITA NO 1572/JP/2008 (COPY ENCLOSED AT PAGES 84 TO 87 OF APB) ACCORDINGLY, WE ORDER TO DELETE THE IMPUGNED ADDITI ON AND ALLOW THE APPEAL OF THE ASSESSEE. THUS GROUND NOS. 1 TO 3 OF THE ASS ESSEE ARE ALLOWED. 4.1 THE GROUND NO. 4 OF THE ASSESSEE RELATING TO CH ARGING OF INTEREST U/S 234B AND 234C IS CONSEQUENTIAL 5.1 IN THE REVENUES APPEAL, THE ONLY GROUND HAS BE EN RAISED WHICH PERTAINS TO DELETION OF ADDITION OF RS. 14,30,009/- MADE BY THE AO ON ACCOUNT OF DISALLOWANCE OF EXPENDITURE. 5.2 THE FACTS OF THIS GROUND ARE THAT THE AO NOTICE D THAT THE ASSESSEE HAS SHOWN NET INCOME FROM JOB WORK AND CONTRACT RECEIPT S OF RS. 5,79,964/- UNDER THE HEAD INCOME FROM OTHER SOURCES. THE AS SESSEE RECEIVED AN AMOUNT OF RS. 63.00 LACS FROM KWALITY RESORTS & HOS PITALITY LTD. MUMBAI AS PER THE CONTRACT. AFTER EXAMINATION, IT WAS FOUN D THAT THE PAYMENTS WEER 16 MADE FOR TRACTOR HIRE AND LABOURERS FOR LEVELLING T HE LAND BETWEEN THE PERIOD 3-10-2007 TO 28-12-007. THE AO OBSERVED THAT THE AS SESSEE HAD SOLD THIS LAND AS PER 03 CONVEYANCE DEEDS TO KWALITY RESORTS & HOSPITALITY LTD., MUMBAI DATED 22-12-2007. IT WAS ALSO NOTICED THAT T HE PAYMENTS WERE MADE IN CASH TO VARIOUS PARTIES. THEREFORE, IN VIEW OF T HE AO, THE ASSESSEE HAS FAILED TO ESTABLISH THE NATURE OF RECEIPT AND EXPEN DITURE AND ACCORDINGLY HE DISALLOWED 25% OF THE PAYMENTS MADE OF RS. 57,20,03 6/- WHICH RESULTED INTO AN ADDITION OF RS. 14,30,009/-. 5.3 THE ASSESSEE WENT IN FIRST APPEAL. THE LD. CIT (A) HAS DELETED THE ENTIRE DISALLOWANCE @ 25% BY TREATING IT SIMPLY ADH OC AND HAVING NO LOGIC OR EVIDENCE. 5.4 BEFORE US, BOTH THE PARTIES HAVE REITERATED THE IR EARLIER ARGUMENTS. 5.5 AFTER HEARING BOTH THE PARTIES AND THE MATERIAL S AVAILABLE ON RECORD, IT WAS NOTICED FROM THE RECORD THAT MOST OF THE PAYMEN TS AGAINST THE IMPUGNED EXPENSES WERE THROUGH CHEQUES. THE NATURE OF WORK A ND ITS PAYMENT STANDS ESTABLISHED FROM THE RECORD AND ASSESSMENT ORDER IT SELF. THE AO HAS NOT PINPOINTED ANY DEFECT IN THESE EXPENSES AND ALSO IN THE BOOKS OF ACCOUNT OF THE ASSESSEE. THEREFORE, THE LUMPSUM ADDITION MADE SIMPLY ON SUSPICION IS NOT CALLED FOR. WE CANNOT APPROVE SUCH ADHOC DISALL OWANCE WHICH ARE NOT TENABLE IN THE EYES OF LAW. ACCORDINGLY, THE IMPUGN ED DELETION OF RS. 14,30,009/- STANDS APPROVED WHICH RESULTED INTO DIS MISSAL OF THE SOLE GROUND 17 RAISED IN REVENUES APPEAL. THUS THE SOLITARY GROUN D OF THE REVENUE IS DISMISSED. 3.0 IN THE RESULT, THE APPEAL OF THE REVENUE IS DIS MISSED AND THAT OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 31-01-2014 SD/- SD/- (.N.K. SAINI) (HARI OM MARATHA) ACCOUNTANT MEMBER JUDICIAL MEMEBR JAIPUR DATED: 31 ST JAN 2014 *MISHRA COPY FORWARDED TO:- BY ORDER 1. THE ITO, WARD- 3(2)/ ACIT, CIRCLE- 3, JAIPUR 2. MS. POOJA AGARWAL, JAIPUR 3. THE LD. CIT(A) 4. THE LD. CIT 5. THE DR 6. THE GUARD FILE (IT NO.84/JP/13) A.R., ITAT, JA IPUR ` 18 19 20