Dr. Vijaynath Rama Talaulikar, Panaji V. Assistant Commissioner Of Income-Tax, CIr-1(1), Panaji

ITA 89/PAN/2014

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 8437 (ITAT-PANAJI)
• Duration Of Justice: 8 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-12-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 11-12-2014
• Assessment Year: 2009-2010
• Appeal Filed On: 18-03-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANJUNATH I PUJAR
• Assessee Lawyers: CHINMAY S KAMAT
• Keywords: Capital asset
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PANAJI BENCH, PANAJI BEFORE SHRI P.K. BANSAL, HONBLE ACCOUNTANT MEMBER AND SHRI D.T. GARASIA, HONBLE JUDICIAL MEMBER ITA NO. 89/PNJ/2014 : (ASST. YEAR : 2009 - 10) DR. VIJAYNATH RAMA TALAULIKAR 110, KAMAT TOWERS, PATTO, PANAJI, GOA 403 001 (APPELLANT) PAN : ABGPT9695R VS. COMMISSIONER OF INCOME TAX, PANAJI (RESPONDENT) ITA NO. 90/PNJ/2014 : (ASST. YEAR : 2009 - 10) MRS. RITA TALAULIKAR 110, KAMAT TOWERS, PATTO, PANAJI, GOA 403 001 (APPELLANT) PAN : ABGPT9694Q VS. COMMISSIONER OF INCOME TAX, PANAJI (RESPONDENT) ASSESSEE BY : CHINMAY S. KAMAT, CA REVENUE BY : MANJUNATH I. PUJAR , DR DATE OF HEARING : 11 / 12 /2014 DATE OF PRONOUNCEMENT : 11 / 12 /2014 O R D E R PER P.K. BANSAL 1. BOTH THESE APPEALS SINCE INVOLVE COMMON ISSUES ARE BEING DISPOSED OFF BY THIS COMMON ORDER. INITIALLY, BOTH THE ASSESSES HAD TAKEN THE FOLLOWING COMMON GROUNDS OF APPEAL : 1) THE CIT IS NOT ENTITLED TO HOLD THAT THE ORDER U/S 143(3) PASSED BY THE AO IS ERRONEOUS AND PREJUDICIAL TO THE INTERESTS OF THE REVENUE. 2 ITA NOS. 89 & 90/PNJ/2014 (A.Y : 2009 - 10) 2) THE CIT IS NOT ENTITLED TO DIRECT THE AO TO RE - FRAME THE ASSESSMENT TO RESTRICT THE EXEMPTION U/S 54EC TO RS. 50,00,000/ - INSTEAD OF RS.1,00,00,000/ - . SUBSEQUENTLY, THE ASSESSEES FILED COMMON REVISED GROUNDS OF APPEAL WHICH READS AS UNDER : 1) UNDER THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE, THE CIT HAS ERRED IN SETTING ASIDE THE ASSESSMENT ORDER, WITHOUT APPRECIATING THAT THE VIEW TAKEN BY THE ASSESSING OFFICER WAS ONE OF THE POSSIBLE VIEWS. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSMENT IN BOTH THE CASES WAS COMPLETED U/S 143(3) ON THE RETURNED INCOME IN WHICH BOTH THE ASSESSEES, BEING SPOUSE, HAD CLAIMED EXEMPTION U/S 54EC ON INVESTMENT MADE IN ELIGIBLE BONDS AMOUNTING TO R S. 1 , 0 0 , 0 0 , 0 0 0 / - E A C H . THE AO ALLOWED THE EXEMPTION. SUBSEQUENTLY, CIT INVOKED JURISDICTION U/S 263. CIT TOOK THE VIEW THAT EACH OF THE SPOUSE HAS CLAIMED EXEMPTION U/S 54EC AT RS. 1,00,00,000/ - . THE CIT, THEREFORE, AFTER HEARING THE ASSESSEES SET ASIDE THE AS SESSMENT ORDER FOR THE A.Y 2009 - 10 BY OBSERVING AS UNDER : 5. I HAVE CONSIDERED THE FACTS OF THE CASE. FROM THE FACTS OF THE CASE, PRIMA - FACIE, IT IS SEEN THAT THE ASSESSMENT ORDERS ARE ERRONEOUS AND PREJUDICE TO THE INTEREST OF REVENUE. THE AO SHOULD HAVE ALLOWED RS. 50 LAKHS AS DEDUCTION U/S 54EC TO EACH SPOUSE. HOWEVER, HE HAS ERRONEOUSLY ALLOWED DEDUCTION OF RS. 1 CRORE U/S 54EC TO EACH SPOUSE. THEREFORE THE ASSESSMENT ORDERS ARE PREJUDICIAL TO THE INTEREST OF REVENUE AND NEED REVISION. I AM OF T HE OPINION THAT PROPER VERIFICATION IS REQUIRED TO BE DONE IN THIS CASE. I THEREFORE SET ASIDE THE ASSESSMENT ORDERS FOR THE ASST. YEAR 2009 - 10 PASSED BY THE AO U/S 143(3) OF THE IT ACT, 1961 ON 08/11/2011 AND, THE AO IS DIRECTED TO PASS FRESH ORDER AFTER VERIFYING THE CLAIM OF THE ASSESSE IN RESPECT OF THE EXEMPTION U/S 54EC OF THE IT ACT. 3. WE HEARD THE RIVAL SUBMISSIONS AND CAREFULLY CONSIDERED THE SAME. WE NOTED THAT IN THESE CASES, NO DOUBT, EACH OF THE ASSESSEE CLAIMED EXEMPTION U/S 3 ITA NOS. 89 & 90/PNJ/2014 (A.Y : 2009 - 10) 54EC AT RS . 1 CRORE ; F O R I N V E S T M E N T M A D E IN TWO DIFFERENT F I N A N C I A L YEARS. EXEMPTION CLAIMED BY EACH OF THE ASSESSEE IN EACH OF THE FINANCIAL YEAR DOES NOT EXCEED RS. 50 LACS. THE PANAJI BENCH OF THE TRIBUNAL HAS VIDE ITS ORDER DT. 28.6.2013 IN ITA NO. 10/PNJ/2013 IN THE CASE OF MS. SHANTABAI V. KAMAT ALSO TAKEN A VIEW IN FAVOUR OF THE ASSESSEE BY HOLDING AS UNDER : 2.3 WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES. LOOKING TO THE FACTS AND CIRCUMSTANCES OF THE CASE, WE FIND THAT THE ASSESSEE HAS SOLD CAPITAL ASSET ON 22.1.2008 FOR RS. 1,90,00,000/ - AND DERIVED CAPITAL GAINS OF RS.1,36,86,597/ - . THE ASSESSEE HAS INVESTED RS. 50 LACS ON 31.3.2008 IN F.Y. 2007 - 08 AND RS. 40 LACS ON 30.6.2008 IN F.Y. 2008 - 09. THUS, THE ASSES SEE HAS NOT INVESTED RS. 50 LACS IN ONE FINANCIAL YEAR IN ELIGIBLE BONDS U/S 54EC. THE ASSESSEE HAS INVESTED THESE TWO AMOUNTS IN DIFFERENT ASSESSMENT YEARS. THE AO HAS ALLOWED THE CLAIM U/S 54EC OF THE INC OME TAX ACT FOR TOTAL AMOUNT OF RS. 90 LACS. WE FI ND THAT THE ITAT IN ASPI GINWALA, SHREE RAM ENGG. & MFG. INDUSTRIES [2012] 20 TAXMAN 75 (AHD.) (SUPRA) HAS HELD THAT IT IS PERMISSIBLE TO GRANT DEDUCTION FOR AMOUNT INVESTED IN TWO FINANCIAL YEARS SO LONG AS THE AMOUNT INVESTED IN ONE YEAR DOES NOT EXCEED RS. 50 LACS. WE FIND FROM THIS DECISION THAT THE AO HAS TAKEN THE VIEW WHICH IS ONE OF THE VIEWS PERMISSIBLE IN CASE TWO VIEWS ARE CAPABLE OF BEING TAKEN. IN THESE CIRCUMSTANCES, WE ARE OF THE VIEW THAT THE AO HAS TAKEN ONE OF THE PERMISSIBLE VIEWS AND IT CANNOT BE TREATED AS ERRONEOUS. THEREFORE, CIT(A) IS NOT JUSTIFIED IN HIS ACTION. 3. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED. 4. IN VIEW OF THIS FACT, WE ARE OF THE VIEW THAT THE AO HAS TAKEN A VIEW WHICH IS ONE OF THE POSSIBLE VIEWS AND TH E VIEW TAKEN BY THE AO CANNOT BE REGARDED TO BE ILLEGAL VIEW OR A VIEW WHICH IS UNSUSTAINABLE IN LAW. THE CASE OF THE ASSESSEE IN OUR VIEW IS DULY COVERED BY THE DECISION OF THE HON'BLE SUPREME COURT IN THE CASE OF MALABAR INDUSTRIAL CO. LTD. VS. CIT [200 0] 243 ITR 83 WHEREIN THE HON'BLE SUPREME COURT HAS HELD AS UNDER: WHEN AN ITO ADOPTED ONE OF THE COURSES PERMISSIBLE IN LAW AND IT HAS RESULTED IN LOSS OF REVENUE; OR WHERE TWO VIEWS ARE POSSIBLE AND THE ITO HAS TAKEN ONE VIEW WITH WHICH THE COMMISSIONER DOES NOT AGREE, IT CANNOT BE TREATED AS AN ERRONEOUS ORDER PREJUDICIAL TO THE INTERESTS OF THE REVENUE UNLESS THE VIEW TAKEN BY THE ITO IS UNSUSTAINABLE IN LAW. 4 ITA NOS. 89 & 90/PNJ/2014 (A.Y : 2009 - 10) 5. IN VIEW OF THE AFORESAID DECISION OF THE HON'BLE SUPREME COURT, WE ARE OF THE VIEW THAT THERE IS NO ERROR IN THE ORDER PASSED BY THE AO IN THE CASE OF BOTH THE ASSESSEES. WE, ACCORDINGLY, SET ASIDE THE ORDER OF CIT. 6. IN THE RESULT, BOTH THE APPEALS FILED BY THE RESPECTIVE ASSESSEES STAND ALLOWED. 7. ORDER PRONOUNCED IN THE OPE N COURT ON 11/12/2014. S D / - (D.T.GARASIA) JUDICIAL MEMBER S D / - (P.K. BANSAL) ACCOUNTANT MEMBER PLACE : PANAJI DATED : 1 1 /12/2014 *SSL* COPY TO : (1) APPELLANTS DR. VIJAYNATH RAMA TALAULIKAR , MRS. RITA TALAULIKAR (2) RESPONDENT (3) CIT CONCERNED (4) CIT(A) CONCERNED (5) D.R (6) GUARD FILE TRUE COPY, BY ORDER