The ACIT, Range-2, Trivandrum, Trivandrum V. Smt.Jayashree Sreedharan, Trivandrum

ITA 96/COCH/2018

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 5129 (ITAT-COCHIN)
• Duration Of Justice: 6 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-10-2018
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 23-10-2018
• Assessment Year: 2012-2013
• Appeal Filed On: 27-03-2018
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: A S BINDHU
• Assessee Lawyers: T M SREEDHARAN
• Keywords: Reassessment proceedings
• Section: 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN BEFORE SHRI CHANDRA POOJAR I, AM & SHRI GEORGE GEORGE K, JM ITA NO. 96 /COCH/201 8 : ASST.YEAR 2012 - 2013 THE ASST.COMMISSIONER OF INCOME - TAX, CIRCLE 2(1) THIRUVANANTHAPURAM . VS. SMT.JAYASREE SREEDHARAN 24/932, BRINDAVAN THYCAUD P.O., METTUKADA TRIVANDRUM 695 014 . PAN : ARVPS2723C (APPELLANT) (RESPONDENT) APPELLANT BY : SMT.A.S.BINDHU, SR.DR RESPONDENT BY : SRI. T.M.SREEDHARAN DATE OF HEARING : 23 .10.2018 DATE OF PRONOUNCEMENT : 24 .10.2018 O R D E R PER GEORGE GEORGE K., JM THIS APPEAL AT THE INSTANCE OF THE REVENUE IS DIRECTED AGAINST THE COMMISSIONER OF INCOME - TAX (APPEALS)S ORDER DATED 30.01.2018 . THE RELEVANT ASSESSMENT YEAR IS 2012 - 2013. 2. THE SOLITARY ISSUE RAISED IN THIS APPEAL IS WHETHER THE ASSESSEE IS ENTITLED TO BENEFIT OF SECTION 10(37) OF THE I.T.ACT IN RESPECT OF THE LAND WHICH WAS ACQUIRED ? 3. BRIEF FACTS OF THE CASE ARE AS FOLLOWS: - THE ASSESSEE WAS IN POSSESSION OF 120 ARES OF LAND IN VIZHINJAM VILLAGE. THE SAID PROPERTY WAS NOTIFIED BY THE GOVERNMENT OF KERALA FOR ACQUISITION UNDER THE LAND ACQUISITION ACT, 1894. SUBSEQUENTLY, AFTER DISCUSSION AND ITA NO. 96 / COCH /201 8. SMT. JAYASREE SREEDHARAN . 2 NEGOTIATIONS WITH THE GOVERNMENT, A SALE DEED WAS EXECUTED, WHEREBY THE PROPERTY WAS SOLD TO VIZHIN JAM INTERNATIONAL SEAPORT LIMITED FOR A TOTAL CONSIDERATION OF RS.7,94,12,901 . FOR THE ASSESSMENT YEAR 2012 - 2013, THE RETURN OF INCOME WAS FILED ON 22.01.2013 DECLARING TOTAL INCOME OF RS.18,16,070, WHICH WAS SUBSEQUENTLY REVISED TO RS.19,40,070. 3.1 THE REAFTER NOTICE U/S 148 OF THE I.T.ACT WAS ISSUED ON 17.12.2013. NOTICE U/S 148 OF THE I.T.ACT WAS ISSUED FOR THE REASON THAT THE ASSESSEE HAD NOT DISCLOSED CAPITAL GAINS TAX FOR LAND SOLD TO VIZHINJAM INTERNATIONAL SEAPORT LIMITED. T HE ASSESSEE FILED LETTE R STATED THAT THE ORIGINAL RETURN FILED MAY BE TAKEN AS ONE FILED IN RESPONSE TO NOTICE U/S 148 OF THE I.T.ACT. DURING THE COURSE OF REASSESSMENT PROCEEDINGS, THE ASSESSEE HAD STATED THAT THE LAND WAS COMPULSORILY ACQUIRED AND THE SAME BEING AN AGRICULTURA L LAND, COMING WITHIN THE NOTIFIED AREA, WAS ENTITLED TO THE BENEFIT U/S 10(37) OF THE I.T.ACT. THE CONTENTION OF THE ASSESSEE WAS REJECTED BY THE ASSESSING OFFICER, SOLELY FOR THE REASON THAT THE LAND IN QUESTION WAS NOT COMPULSORILY ACQUIRED BUT WAS TRAN SFERRED BY EXECUTING A SALE DEED. THEREFORE, IT WAS CONCLUDED BY THE ASSESSING OFFICER THAT THE ASSESSEE WAS NOT ENTITLED TO THE BENEFIT OF SECTION 10(37) OF THE I.T.ACT . 4 . AGGRIEVED BY THE REASSESSMENT ORDER, THE ASSESSEE FILED AN APPEAL TO THE FIRST APPELLATE AUTHORITY. THE CIT(A), BY FOLLOWING THE JUDGMENT OF THE HONBLE APEX COURT IN THE CASE OF BALAKRISHNAN V. UNION OF INDIA [(2017) 391 ITR 178 (SC)], HELD THAT THE ASSESSEE WAS ENTITLED TO THE BENEFIT OF SECTION ITA NO. 96 / COCH /201 8. SMT. JAYASREE SREEDHARAN . 3 10(37) OF THE I.T.ACT, AND HENCE, WO ULD NOT BE LIABLE FOR LONG TERM CAPITAL GAINS ON THE ACQUISITION OF THE IMPUGNED LAND. 5. THE REVENUE BEING AGGRIEVED, HAS FILED THE PRESENT APPEAL BEFORE THE TRIBUNAL. THE LEARNED DEPARTMENTAL REPRESENTATIVE STRONGLY RELIED ON THE ASSESSMENT ORDER. THE LEARNED AR, ON THE OTHER HAND, SUBMITTED THAT LAND WHICH WAS ACQUIRED BY THE VIZHINJAM INTERNATIONAL SEAPORT LIMITED , WAS ADMITTEDLY AGRICULTURAL LAND AND THE ASSESSEE CARRIED OUT COCONUT PLANTATION AND CERTAIN OTHER CROPS. THE SOLITARY REASON FOR DENYING THE BENEFIT OF SECTION 10(37) OF THE I.T.ACT WAS THAT THE IMPUGNED LAND WAS NOT COMPULSORILY ACQUIRED, BUT BY EXECUTING A SALE DEED IN FAVOUR OF VIZHINJAM INTERNATIONAL SEAPORT LIMITED . IN THIS CONTEXT, THE LEARNED AR SUBMITTED THAT THE ISSUE IS SQUARELY C OVERED IN FAVOUR OF THE ASSESSEE BY THE JUDGMENT OF THE HONBLE APEX COURT IN THE CASE OF BALAKRISHNAN V. UNION OF INDIA (SUPRA) AND UNION OF INDIA V. INFOPARK KERALA [81 TAXMANN.COM 51 (SC)]. IT WAS CONTENDED THAT THE HONBLE APEX COURT IN ABOVE CASES HA D CLEARLY HELD THAT SINCE THE ENTIRE PROCEDURE FIXED UNDER LAND ACQUISITION ACT WAS FOLLOWED, THE CHARACTER OF ACQUISITION FROM THAT OF COMPULSORY ACQUISITION TO VOLUNTARY SALE WOULD NOT CHANGE THOUGH THE PRICE WAS FIXED ON NEGOTIATED SETTLEMENT. 6 . WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. THE SOLITARY REASON FOR NOT GRANTING OF BENEFIT OF SECTION 10(37) OF THE I.T.ACT IN RESPECT OF ACQUISITION OF URBAN AGRICULTURAL LAND WAS THAT IT WAS NOT A COMPULSORY ACQUISITION, BUT ONLY EXECUTED THROUGH A NEGOTIATED SALE DEED. ITA NO. 96 / COCH /201 8. SMT. JAYASREE SREEDHARAN . 4 THE HONBLE APEX COURT IN THE CASE OF BALAKRISHNAN V. UNION OF INDIA & OTHERS (SUPRA) HAD CATEGORICALLY HELD MERELY BECAUSE THE SALE PRICE IS FIXED THROUGH A NEGOTIATED SETTLEMENT WILL NOT TAKE AWAY THE PROCEED INGS FROM THE LAND ACQUISITION ACT WHEN THE RELEVANT PROVISION OF THE ACT ARE INVOKED. THE RELEVANT FINDING OF THE HONBLE APEX COURT READS AS FOLLOWS: - 8. IN OUR VIEW, INSOFAR AS ACQUISITION OF THE LAND IS CONCERNED, THE SAME WAS COMPULSORILY ACQUIRED AS THE ENTIRE PROCEDURE PRESCRIBED UNDER THE LA ACT WAS FOLLOWED. THE SETTLEMENT TOOK PLACE ONLY QUA THE AMOUNT OF THE COMPENSATION WHICH WAS TO BE RECEIVED BY THE APPELLANT FOR THE LAND WHICH HAD BEEN ACQUIRED. IT GOES WITHOUT SAYING THAT HAD STEPS NOT BE EN TAKEN BY THE GOVERNMENT UNDER SECTIONS 4 AND 6 FOLLOWED BY AWARD UNDER SECTION 9 OF THE LA ACT, THE APPELLANT WOULD NOT HAVE AGREED TO DIVEST THE LAND BELONGING TO HIM TO TECHNO PARK. HE WAS COMPELLED TO DO SO BECAUSE OF THE COMPULSORY ACQUISITION AND T O AVOID LITIGATION ENTERED INTO NEGOTIATIONS AND SETTLED THE FINAL COMPENSATION. MERELY BECAUSE THE COMPENSATION AMOUNT IS AGREED UPON WOULD NOT CHANGE THE CHARACTER OF ACQUISITION FROM THAT OF COMPULSORY ACQUISITION TO THE VOLUNTARY SALE. IT MAY BE MENTIO NED THAT THIS IS NOW THE PROCEDURE WHICH IS LAID DOWN EVEN UNDER THE RIGHT TO FAIR COMPENSATION AND TRANSPARENCY IN LAND ACQUISITION, REHABILITATION AND RESETTLEMENT ACT, 2013 AS PER WHICH THE COLLECTOR CAN PASS REHABILITATION AND RESETTLEMENT AWARD WITH T HE CONSENT OF THE PARTIES / LANDOWNERS. NONETHELESS, THE CHARACTER OF ACQUISITION REMAINS COMPULSORY. 6 .1 IN THE INSTANT CASE, THE ENTIRE PROCEDURE PRESCRIBED UNDER THE LAND ACQUISITION ACT WAS FOLLOWED, ONLY PRICE WAS FIXED UPON A NEGOTIATED SETTLEMENT. THEREFORE, IN VIEW OF THE ABOVE JUDGMENT OF THE HONBLE APEX COURT (SUPRA), WE HOLD THAT THE ACQUISITION OF THE URBAN AGRICULTURAL LAND WAS A COMPULSORY ACQUISITION AND THE SAME WOULD BE ENTITLED TO THE BENEFIT ENUMERATED IN SECTION 10(37) OF THE I.T.ACT. IT IS ORDERED ACCORDINGLY. ITA NO. 96 / COCH /201 8. SMT. JAYASREE SREEDHARAN . 5 7 . IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED ON THIS 24 TH DAY OF OCTOBER, 2018 . SD/ - SD/ - ( CHANDRA POOJARI ) ( GEORGE GEORGE K. ) ACCOUNTANT MEMBER JUDICIA L MEMBER COCHIN ; DATED : 24 TH OCTOBER, 2018 . DEVDAS* COPY OF THE ORDER FORWARDED TO : BY ORDER, (ASSTT. REGISTRAR) ITAT, COCHIN 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT (A) TRIVANDRUM. 4. THE CIT TRIVANDRUM. 5. DR, ITAT, COCHIN 6 . GUARD FILE.