VRAJLAL P. CHAUHAN, MUMBAI V. ITO WD 25(2)(4), MUMBAI

ITA 882/MUM/2009

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 1041 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 5 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-07-2010
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Next Hearing Date: 17-06-2010
• Assessment Year: 2005-2006
• Appeal Filed On: 10-02-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: JAGDISH
• Assessee Lawyers: M SUBRAMANIAN
• Keywords: Question of law
• Section: 143(3); 234B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH F MUMBAI BEFORE SHRI T.R. SOOD (AM) AND SMT. ASHA VIJAYARAG HAVAN (JM) ITA NO.882/MUM/2009 ASSESSMENT YEAR-2005-06 SHRI VRAJLAL P. CHAUHAN, 204, VISHAL C.H.S. NO 2, SHIMPOLI X ROAD, OPP. SONI WADI, BORIVLI (W), MUMBAI-400 092 PAN-AAFPC 5313H VS. THE ITO, WARD 25(2)(4), C-11 PRATYAKSAKAR BHAVAN, BANDRA, MUMBAI (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI M. SUBRAMANIAN RESPONDENT BY: SHRI JAGDISH O R D E R PER SMT. ASHA VIJAYARAGHAVAN (JM) THIS APPEAL PREFERRED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DT. 2.12.2008 PASSED BY THE LD. CIT(A)-XXV, MUMBAI FOR THE ASSESSMENT YEAR 2005-06. 2. THE ASSESSEE IS AN INDIVIDUAL DOING THE BUSINES S IN THE LINE OF CIVIL LABOUR JOB AND TRADING IN GRANITES AND MARBLES. FO R THE YEAR UNDER APPEAL, THE ASSESSEE HAD FILED HIS RETURN OF INCOME SHOWING INCOME OF RS. 1,20,250/- THE CASE WAS SELECTED FOR SCRUTINY AND THEREAFTER ORDER WAS PASSED U/S. 143(3) BY THE ITO. WHILE COMPLETIN G THE ASSESSMENT, THE ASSESSING OFFICER ASSESSED THE ASSESSEES INCOM E AT RS. 14,38,700/-. THE AO ADDED AN AMOUNT OF RS. 11,18,455/- ON LONG T ERM CAPITAL GAIN BY SALE OF PROPERTY. THE AO FURTHER ADDED AN AMOUN T OF RS. 2 LAKHS AS INCOME FROM UNEXPLAINED SOURCES. 3. AGGRIEVED, ASSESSEE PREFERRED AN APPEAL BEFORE T HE LD. CIT(A) AND THE LD. CIT(A) PARTLY ALLOWED THE ASSESSEES APPEAL . ITA NO.882 /M/09 2 4. AGGRIEVED, ASSESSEE FILED AN APPEAL AND RAISED T HE ADDITIONAL GROUND OF APPEAL BEFORE US AS FOLLOWS: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE & IN LAW, THE LD. CIT(A) ERRED IN HOLDING THAT THE PROPE RTY (PLOT NO. 33 & 32 HALF) WAS PURCHASED ON 10.8.2004 AND FURTHER ERRED IN DIRECTING THE TAXING OF THE CA PITAL GAINS INCOME AS SHORT TERM CAPITAL GAINS. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E & IN LAW, THE LD. CIT(A) ERRED IN NOT APPRECIATING THAT THE PROPERTY (PLOT NO. 33 & 32 HALF) WAS PURCHASED ON 13.1.2000 AND THE CONSEQUENT CAPITAL GAINS ARISING WOULD BE LONG TERM CAPITAL GAINS. 3. WITHOUT PREJUDICE TO THE ABOVE, AND ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, IF THE PR OPERTY IS TREATED AS TRANSFERRED DURING THE PERIOD RELEVAN T TO A.Y. 2005-06 THE INVESTMENT MADE AND EXEMPTION U/S. 54 CLAIMED IN THE A.Y. 2006-07 BE DIRECTED TO BE CONSIDERED FOR THE A.Y. 2005-06. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E & IN LAW, THE INTEREST CHARGED U/S. 234B & 234C OF THE I .T. ACT, ARE INVALID AND BAD IN LAW. 5 WE FIND THAT THE ISSUES RAISED IN THESE ADDITIONAL GROUNDS GO TO THE VERY ROOT OF THE ISSUES IN APPEAL. THESE MATTERS H AVE NOT BEEN LOOKED INTO BY THE LOWER AUTHORITIES. THE APEX COURT IN T HE CASE OF NATIONAL THERMAL POWER CO. LTD., VS CIT HAS HELD AS UNDER: THE TRIBUNAL SHOULD NOT BE PREVENTED FROM CONSIDER ING QUESTIONS OF LAW ARISING IN ASSESSMENT PROCEEDINGS, ALTHOUGH NOT RAISED EARLIER. THE VIEW THAT THE TRIBUNAL IS CONFINED ONLY TO ISSUES ARISING OUT OF THE APPEAL BEFORE THE COMM ISSIONER (APPEALS) IS TOO NARROW A VIEW TO TAKE OF THE POWER S OF THE TRIBUNAL. UNDOUBTEDLY, THE TRIBUNAL HAS THE DISCRETION TO ALL OW OR NOT TO ALLOW A NEW GROUND TO BE RAISED. BUT WHERE THE TRI BUNAL IS ONLY REQUIRED TO CONSIDER THE QUESTION OF LAW ARISI NG FROM FACTS ITA NO.882 /M/09 3 WHICH ARE ON RECORD IN THE ASSESSMENT PROCEEDINGS, THERE IS NO REASON WHY SUCH A QUESTION SHOULD NOT BE ALLOWE D TO BE RAISED WHEN IT IS NECESSARY TO CONSIDER THAT QUEST ION IN ORDER TO CORRECTLY ASSESS THE TAX LIABILITY OF AN ASSESSE E. THE TRIBUNAL HAD JURISDICTION TO EXAMINE A QUESTIO N OF LAW WHICH AROSE FROM THE FACTS AS FOUND BY THE INCOME-T AX AUTHORITIES AND HAVING A BEARING ON THE TAX LIABILI TY OF THE ASSESSEE. 6. WE ARE THEREFORE ADMITTING THE ADDITIONAL GROUND S FILED BY THE ASSESSEE AND REMITTING THE MATTER BACK TO THE AO TO ADJUDICATE ON THESE ISSUES IN ACCORDANCE WITH LAW AFTER AFFORDING REASO NABLE OPPORTUNITY TO THE ASSESSEE TO PRESENT HIS CASE. 7. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON THIS 23 RD DAY OF JULY, 2010 SD/- SD/- (T.R. SOOD ) (ASHA VIJAYARAGHAVAN) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED 23 RD JULY, 2010 RJ COPY TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT-CONCERNED 4. THE CIT(A)-CONCERNED 5. THE DR F BENCH TRUE COPY BY ORDER ASSTT. REGISTRAR, I.T.A.T, MUMBAI ITA NO.882 /M/09 4 DATE INITIALS 1 DRAFT DICTATED ON: 20.7.2010 SR. PS/PS 2. DRAFT PLACED BEFORE AUTHOR: 21. 7 .2010 ______ SR. PS/PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER: _________ ______ JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER: _________ ______ JM/AM 5. APPROVED DRAFT COMES TO THE SR. PS/PS: _________ ______ SR. PS/PS 6. KEPT FOR PRONOUNCEMENT ON: _________ ______ SR. PS/ PS 7. FILE SENT TO THE BENCH CLERK: _________ ______ SR. PS/PS 8. DATE ON WHICH FILE GOES TO THE HEAD CLERK: _________ ______ 9. DATE OF DISPATCH OF ORDER: _________ ______