The Deputy Commissioner of Income Tax, Central Circle-4, Surat V. Shri Hitendra Dullabhbhai Patel, Surat

ITSSA 227/AHD/2017

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 9311 (ITAT-SURAT)
• Duration Of Justice: 4 year(s) 2 month(s) 15 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 30-07-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2013-2014
• Appeal Filed On: 15-05-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: O P VAISHNAV
• Keywords: Unexplained investment; Sale consideration of property below Jantri Value; Capital asset; Search and seizure; Capital Gains
• Section: 143(3); 50C; 142(1); 133A; 153A; 143(2); 139(1); 139(4); 13; 153; 22; 153C; 131; 69; 132; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, SURAT BENCH, SURAT BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER AND DR. ARJUN LAL SAINI, ACCOUNTANT MEMBER IT(SS) A NO.226 & 227/AHD/2017 (AY 2011-12& 2013-14) (H EARING IN VIRTUAL COURT) THE DCIT, CC-4, ROOM NO. 508, 5 TH FLOOR, AAYAKAR BHAVAN, MAJURA GATE, SURAT-395001. VS SHRI HINTENDRA DULLABHBHAI PATEL, MANIKUNJ, JAMNANAGAR BUS STOP, NEAR GHODDOD ROAD, SURAT 395001. PAN : ACFPP4596F REVENUE / APPELLANT ASSESSEE /RESPONDENT ASSESSEE BY SH. SOURABH SOPARKAR SENIOR ADVOCATE WITH MS URVASHI SODHAN ADVOCATE REVENUE BY SH. O.P.VAISHNAV CIT-DR DATE OF HEARING 11.05.2021 DATE OF PRONOUNCEMENT 30.07.2021 ORDER UNDER SECTION 254(1) OF INCOME TAX ACT PER PAWAN SINGH, JUDICIAL MEMBER: 1. THESE TWO APPEALS BY REVENUE ARE DIRECTED AGAINST THE COMMON ORDER OF LD. CIT(A)-4, SURAT DATED 28.02.2017 FOR ASSESSMENT YEAR 2011-12 AND 2013-14. THE FACTS FOR BOTH THE YEARS ARE INTER-RELATED, THE LD CIT(A) PASSED CONSOLIDATED ORDER FOR BOTH THE ASSESSMENT YEARS, THUS, BOTH THE APPEALS CLUBBED, HEARD TOGETHER AND ARE DECIDED BY COMMON ORDER TO AVOID THE CONFLICTING DECISION. IN APPEAL FOR AY 2011-12, THE REVENUE RAISED FOLLOWING GROUNDS OF APPEAL: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN DELETING THE FOLLOWING ADDITIONS STATING THAT THE AO HAD NO JURISDICTION TO MAKE ADDITIONS IN COMPLETED ASSESSMENT U/S. 153A R.W.S. 153C OF THE ACT; IN THE IT (SS) A NO.226 & 227/AHD/2017 SHRI HINTENDRADULLABHBHAI PATEL (AYS 2011-12 & 2013-14) 2 ABSENCE OF ANY INCRIMINATING DOCUMENTS OR EVIDENCE FOUND DURING SEARCH PROCEEDINGS. 1. ADDITION U/S. 69 ON LAND BLOCK NO. 127 RS.11,00,000/- 2. UNEXPLAINED INVESTMENT U/S. 69 ON PROTECTIVE BASIS RS.2,97,59,230/ 3. ADDITION U/S. 69 ON LAND BLOCK NO. 141 KHAJOD RS.11,00,000/ 4. UNEXPLAINED INVESTMENT U/S. 69 ON PROTECTIVE BASIS RS.2,50,00,000/- 5. UNEXPLAINED INVESTMENT MADE U/S. 69 RS.3,00,00,000/- 6. UNEXPLAINED INVESTMENT U/S. 69 ON PROTECTIVE BASIS RS.2,94,94,997/- 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT (A) HAS ERRED IN ALLOWING THE ADDITIONAL GROUNDS OF APPEAL RAISED BY THE ASSESSEE IGNORING THE PROVISO OF CLAUSE (B) OF SECTION 153A OF THE ACT WHICH EMPOWERS THE AO TO ASSESS OR REASSESS THE TOTAL INCOME IN RESPECT OF EACH ASSESSMENT YEAR FALLING WITHIN SUCH SIX ASSESSMENT YEARS. THE SECTION 153A DOES NOT PRECLUDE THE AO TO LOOK BEYOND THE INCRIMINATING MATERIAL AND RESTRICT THE ASSESSMENT TO THE INCRIMINATING EVIDENCES FOUND AND SEIZED DURING THE COURSE OF SEARCH. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT (A) HAS ERRED IN RELYING ON THE DECISION OF THE HON'BLE SPECIAL BENCH OF ITAT, MUMBAI IN THE CASE OF ALL CARGO GLOBAL LOGISTICS LTD. VS. DCIT(2012) 147 TTJ 0513 (SB) AND HOLDING THAT THE HON'BLE ITAT AHMEDABAD HAS FOLLOWED THE JUDGMENT IN THE CASE SAUMYA CONSTRUCTION (P) LTD. AND DESAI CONSTRUCTION (P) LTD. THE SLP HAD ALREADY BEEN FILED BEFORE THE HON'BLE SUPREME COURT OF INDIA BY THE DEPARTMENT AGAINST THE HIGH COURT DECISION IN THE CASE OF ALL CARGO GLOBAL LOGISTICS LTD. VS. DCIT (2012 147 TTJ 0513 (SB) VIDE SLP (C) NO. 5254-5265/2016 AND IN THE CASE OF CONTINENTAL WAREHOUSING CORPORATION (NHAVA SHEVA) LTD. VIDE SLP (C) NO. CC 18506 OF 2015. IT (SS) A NO.226 & 227/AHD/2017 SHRI HINTENDRADULLABHBHAI PATEL (AYS 2011-12 & 2013-14) 3 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT (A) HAS ERRED IN DECIDING THE CASE ON TECHNICAL GROUND ONLY WITHOUT GOING INTO THE MERITS OF INVESTIGATION CARRIED OUT BY THE A.O. 2. IN APPEAL FOR AY 2013-14, THE REVENUE HAS RAISED FOLLOWING GROUNDS OF APPEAL; (1) ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.1,98,55,640/- MADE BY A.O. UNDER SECTION 50C ON ACCOUNT OF LONG TERM CAPITAL GAIN FOR SALE OF LAND OF T P NO.4 & 5, VESU HOLDING THAT NO CAPITAL GAIN IS LIABLE FOR TAX FOR A.Y. 20113-14 DESPITE THE FACT THAT PAYMENTS WERE MADE IN MARCH, 2012 TO OCTOBER 2013 AND THERE WAS NO PERFORMANCE BY THE PURCHASERS IN A.Y. 2011-12. (2) ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) OUGHT TO HAVE UPHELD THE ORDER OF ASSESSING OFFICER. 3. BRIEF FACTS OF THE CASE ARE THAT ASSESSEE RUNS A PROPRIETARY BUSINESS IN THE NAME OF J. J. CHEMICALS AND PARTNER IN DRB RAVANI BUILDER. A SEARCH UNDER SECTION 132 WAS CARRIED OUT BY DEPARTMENT IN CASE OF LAND DEALERS AND BUILDERS GROUP ON 27.12.2012. IN SEARCH CERTAIN INCRIMINATING MATERIAL RELATED WITH THE LAND DEALERS AND BUILDERS WERE FOUND AND SEIZED. CONSEQUENT, OF SEARCH, A NOTICE UNDER SECTION 153C WAS SERVED UPON THE ASSESSEE ON 16.09.2014 TO FILE RETURN OF INCOME FOR AY 2011-12. THE NOTICE WAS SERVED ON THE GROUND THAT THE ASSESSEE IS ONE OF THE RELATED PARTIES WITH THE LAND AND BUILDERS GROUP. FURTHER NOTICE UNDER SECTION 143(2) AND 142(1) WAS SERVED ON THE ASSESSEE ON 19.01.2015. THE ASSESSEE OBJECTED TO THE NOTICE UNDER SECTION 153C, ON THE GROUND THAT NEITHER THE ASSESSEE WAS SEARCHED NOR COVERED IN THE SEARCH, THE NOTICE IS SERVED AFTER 21 MONTHS FROM THE DATE OF SEARCH. THE TIME LIMIT IT (SS) A NO.226 & 227/AHD/2017 SHRI HINTENDRADULLABHBHAI PATEL (AYS 2011-12 & 2013-14) 4 PRESCRIBED UNDER SECTION 153B FOR COMPLETING ASSESSMENT UNDER SECTION 153C, WAS UP TO 31.03.2016. THE OBJECTION OF ASSESSEE WAS NOT ACCEPTED BY THE ASSESSING OFFICER. THE ASSESSING OFFICER ISSUED SHOW CAUSE NOTICE UNDER SECTION 144. THE ASSESSEE RAISED OBJECTION FOR COMPLETING ASSESSMENT UNDER SECTION 144. THE ASSESSING OFFICER AFTER REJECTING THE OBJECTION OF ASSESSEE PROCEEDED FOR ASSESSMENT. THE ASSESSING OFFICER WHILE PASSING THE ASSESSMENT ORDER MADE FOLLOWING ADDITIONS: 1. ADDITION U/S. 69 ON LAND BLOCK NO. 127 RS.11,00,000/- 2. UNEXPLAINED INVESTMENT U/S. 69 ON PROTECTIVE BASIS RS.2,97,59,230/ 3. ADDITION U/S. 69 ON LAND BLOCK NO. 141 KHAJOD RS.11,00,000/ 4. UNEXPLAINED INVESTMENT U/S. 69 ON PROTECTIVE BASIS RS.2,50,00,000/- 5. UNEXPLAINED INVESTMENT MADE U/S. 69 RS.3,00,00,000/- 6. UNEXPLAINED INVESTMENT U/S. 69 ON PROTECTIVE BASIS RS.2,94,94,997/- 4. THE ASSESSING OFFICER ALSO WITHDREW THE LONG TERM CAPITAL GAIN (LTCG) OFFERED / SHOWN BY THE ASSESSEE IN AY 2011-12. THE ASSESSEE OFFERED CAPITAL GAIN ON THE BASIS OF AGREEMENT TO SALE AND POSSESSING HANDED OVER TO DRB RAVANI BUILDER ON 01.11.20. THE ASSESSING OFFICER WITHDREW THE CAPITAL GAIN FOR MAKING ADDITION IN THE ASSESSMENT YEAR 2013-14, ON THE BASIS OF SALE DEED EXECUTED IN FAVOUR OF DRB RAVANI BUILDER ON 09.10.2012, AND ACCORDINGLY MADE ADDITION IN THE ASSESSMENT YEAR 2013-14. IT (SS) A NO.226 & 227/AHD/2017 SHRI HINTENDRADULLABHBHAI PATEL (AYS 2011-12 & 2013-14) 5 5. ON APPEAL BEFORE CIT(A), THE ASSESSEE FILED DETAILED WRITTEN SUBMISSION. THE ASSESSEE ALSO RAISED AN ADDITIONAL GROUND OF APPEAL THAT THE ASSESSING OFFICER MADE ADDITION IN ASSESSMENT ORDER UNDER SECTION 143(3) R.W.S 15CA IN ABSENCE OF INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH. NO ASSESSMENT PROCEEDING WAS PENDING ON THE DATE OF SEARCH. THUS, THE ADDITIONSWERE MADE OTHERWISE THEN INCRIMINATING MATERIAL. THE LD. CIT(A) GRANTED OPPORTUNITY TO THE ASSESSING OFFICER TO FURNISH HIS REPLY/ COMMENTS. THE ASSESSING OFFICER HAS FURNISHED VIDE REPLY DATED 24.10.2016. THE LD. CIT(A) AFTER CONSIDERING THE ADDITIONAL GROUND OF APPEAL, THE REPLY FURNISHED BY ASSESSING OFFICER AND CONSIDERING THE DECISION OF VARIOUS HONBLE HIGH COURTS INCLUDING JURISDICTIONAL HIGH COURT, DELHI HIGH COURT AND BOMBAY HIGH COURT IN SAUMYA CONSTRUCTION (P) LTD. REPORTED VIDE 387 ITR 529, KABUL CHAWLA 234 TAXMAN 300 AND CONTINENTAL WAREHOUSING (NHAVA SHEVA) LTD [2015] 58 TAXMANN.COM 78, RESPECTIVELY AND ALLOWED THE ADDITIONAL GROUNDS OF APPEAL. ] 6. THE LD. CIT(A) AFTER PERUSAL ON RECORD AND THE AFORESAID DECISIONS HELD THAT THE ASSESSEE FILED ORIGINAL RETURN OF INCOME FOR AY 2011-12 ON 27.03.2013. THE TIME LIMIT FOR ISSUANCE OF NOTICE UNDER SECTION 143(2) HAD ALSO EXPIRED WHEN THE SATISFACTION WAS RECORDED ON 16.09.2014 FOR ISSUANCE OF NOTICE UNDER SECTION 153C. ON THE BASIS OF AFORESAID FACTUAL AND LEGAL DISCUSSION, THE LD. CIT(A) HELD THAT THE ADDITIONS MADE BY ASSESSING OFFICER IN ASSESSMENT FOR IT (SS) A NO.226 & 227/AHD/2017 SHRI HINTENDRADULLABHBHAI PATEL (AYS 2011-12 & 2013-14) 6 AY 2011-12 ARE NOT BASED ON ANY EVIDENCE, BELONGING TO THE ASSESSEE FOUND DURING THE SEARCH. ALL THE ADDITIONS ARE BASED ON THE COPY OF DRAFTS OF STATAKHAT (AGREEMENT) OF DIFFERENT LANDS WHICH WERE IMPOUNDED DURING THE COURSE OF SURVEY UNDER SECTION 133A FROM THE PREMISES OF A SAI LEELA ASSOCIATE, 302, SNS HOUSE-3 ATHWALINES, SURAT. THE LD. CIT(A) ALSO HELD THAT NO ADDITION MADE ON THE BASIS OF DOCUMENT WHICH WERE BELIEVED TO BELONGING TO THE ASSESSEE WHILE RECORDING SATISFACTION. THUS, THE LD. CIT(A) ALLOWED THE ADDITIONAL GROUND OF APPEAL AND DELETED THE ADDITIONS. 7. BEFORE THE LD. CIT(A), THE ASSESSEE ALSO MADE SUBMISSION FOR OBJECTING THE ADDITIONS ON MERITS. ALL THE SUBMISSION OF THE ASSESSEE WITH REGARD TO THE VARIOUS ADDITIONS ARE RECORDED BY LD. CIT(A) IN PARA 7 AT PAGE NO. 8 TO 38. HOWEVER, THE LD. CIT(A) ON THE MERITS OF THE ADDITIONS HELD THAT THE ADDITION ARE NOT BASED ON ANY INCRIMINATING MATERIAL. THEREFORE, DISCUSSION ON MERIT OF THE ADDITION HAD BECOME ACADEMIC. 8. ON THE ISSUE OF WITHDRAWAL OF LONG TERM CAPITAL GAIN, THE ASSESSEE ALSO MADE SEPARATE WRITTEN SUBMISSION AS RECORDED IN PARA 8 AT PAGE NO. 38 TO 51 OF THE ORDER OF LD. CIT(A). THE ASSESSEE SUBMITTED THAT THE ASSESSEE M/S DRB RAVANI DEVELOPERS IS A PARTNERSHIP FIRM, ENGAGED IN THE BUSINESS OF RESIDENTIAL PROJECT, NAMELY CALLESTRIAL DREAMS. THE ASSESSEE ALONG WITH OTHER NINETEEN PARTNERS IS PARTNER IN M/S DRB RAVANI DEVELOPERS. THE ASSESSEE ALONG WITH HIS SEVEN IT (SS) A NO.226 & 227/AHD/2017 SHRI HINTENDRADULLABHBHAI PATEL (AYS 2011-12 & 2013-14) 7 CO-OWNERS WERE HAVING AGRICULTURAL LAND BEARING A PLOT NO. 4 & 5 TPS FILE (VESU BHIMRAD) KNOWN AS VESU LAND, EACH WERE HAVING 12.5% SHARE IN THE LAND. THE TOTAL SELLABLE AREA OF VESU LAND WAS 32064 SQ. MTS, (AS PER REVENUE RECORD 34100 SQ. MTS), OUT OF THE TOTAL AREA 17307 SQ.MTS WAS SOLD BY ASSESSEE WITH SEVEN OTHER CO-OWNERS DURING THE YEAR UNDER CONSIDERATION. 8653.509 SQ.MT.(AS PER REVENUE RECORD 9230 SQ.MT) AREA WAS SOLD BY ASSESSEE WITH SEVEN OTHER CO-OWNERS WITH MUTUAL AGREEMENT TO RAJKUMAR KARAMSHIBHAI RAVANI AND ELEVEN OTHER PARTIES ON 25.10.2010 FOR CONSIDERATION OF RS.6.05 CRORES. RAJ KUMAR KARAMSHIBHAI RAVANI AND OTHER CO-OWNER OF SAID LAND INTRODUCED THE LAND TO THEIR PARTNERSHIP FIRM THROUGH PARTNERSHIP DATED 08.10.2010 FOR A SALE CONSIDERATION OF RS.6.05 CRORES.THE JANTRY RATE OF LAND DURING THAT TIME WAS RS.7,000/- PER SQ.MT. THE ASSESSEES SHARE BEING 12.5% OF SALE PROCEED WAS RS.75,72,000/-. ANOTHER PORTION OF 8653.50 SQ.MT. (AS PER REVENUE RECORD 9230 SQ.MT) WAS INTRODUCED BY ASSESSEE AND SEVEN OTHER CO-OWNERS AS CAPITAL INTRODUCTION IN THE PARTNERSHIP FIRM, M/S DRB RAVANI DEVELOPERS. THE LAND VALUE RECORDED IN THE BOOKS OF ACCOUNT OF FIRM WAS RS.60,576,000/- AND THE ASSESSEES SHARE BE 12.5% WAS RS.75,72,000/-. THE TOTAL LAND CONTRIBUTION BY OR TWENTY PARTNERS BECAME 17307 SQ.MTS, ON WHICH PROJECT OF CALLESTRIAL DREAMS WAS STARTED. ALL THE CO-OWNERS HAD DULY PAID TAX ON THE SALE OF LAND IN A.Y 2011-12 , THE ASSESSEE FURNISHED COPY OF INCOME TAX RETURN ALL CO-OWNERS IT (SS) A NO.226 & 227/AHD/2017 SHRI HINTENDRADULLABHBHAI PATEL (AYS 2011-12 & 2013-14) 8 SHOWING LONG TERM CAPITAL GAINS CALCULATION OF ALL PARTNERS. THE ASSESSEE HAS SHOWN LONG TERM CAPITAL GAINS OF RS.1.45 CRORES. ON INTRODUCTION OF LAND BY ALL PARTNERS TO THE FIRM, POSSESSION OF LAND WAS GIVEN ON 01.11.2010 AND CONSTRUCTION WAS STARTED BY FIRM IN AY 2011-12. THE FIRM-DRB RAVANI DEVELOPERS HAD SHOWN THE LAND AS STOCK-IN-TRADE IN THE BALANCE-SHEET IN A.Y. 2011-12. 9. ONE OF THE FAMILY MEMBERS OF ASSESSEE FILED A CIVIL SUIT AND OBTAINED A STAY ORDER FROM CIVIL COURT, AGAINST THE TRANSFER OF LAND. DUE TO STAY ON SALE OF THE PORTION OF LAND, SALE DEED COULD NOT BE EXECUTED. THE ASSESSEE ALSO FILED THE COPY OF STAY ORDER. THE CIVIL DISPUTE WAS CLEARED IN AY 2012-13 AND THE SALE DEED WAS EXECUTED ON 09.11.2012 AT STAMP DUTY APPLICABLE ON THAT DAY AT RS.6.06 CRORE. COPY OF SALE DEED WAS ALSO FURNISHED. THE ASSESSEE ALSO CONTENDED THAT HE AND OTHER SEVEN CO-OWNERS SHOWN CAPITAL GAINS IN A.Y. 2011-12 AS POSSESSION WAS ALREADY HANDED OVER TO RAJKUMAR RAVANI. THE ASSESSEE FURTHER STATED THAT DURING ASSESSMENT THE ASSESSEE FILED THE COPY OF SALE DEED AND ALL THE FACTS WERE EXPLAINED VIDE SUBMISSIONS DATED 24.03.2015. THE ASSESSEE ALSO STATED THAT THE ADDITION IS NOT BASED ON INCRIMINATING MATERIAL FOUND AT THE TIME OF SEARCH ON 27.12.2012 ON LAND AND BUILDERS GROUP. THE INCRIMINATING DOCUMENTS RELATED TO ASSESSEE SEIZED FROM THE PREMISES WERE ASKED VIDE NOTICE DATED 11.09.2014 I.E. BEFORE ISSUANCE OF NOTICE UNDER SECTION IT (SS) A NO.226 & 227/AHD/2017 SHRI HINTENDRADULLABHBHAI PATEL (AYS 2011-12 & 2013-14) 9 153C ON 16.09.2014, WHICH NOWHERE CONTAIN ANY QUERY OR MATERIAL WITH REGARD TO LAND IN DISPUTE. THE ASSESSEE ALSO RELIED ON CERTAIN CASE LAW, 10. THE LD. CIT(A) AFTER CONSIDERING THE SUBMISSION HELD THAT THE CAPITAL GAIN OF THE IMPUGNED LAND IS TAXABLE IN THE AY 2011-12 AND DIRECTED TO DELETE THE ADDITIONS IN AY 2013-14. THE LD. CIT(A) ALSO HELD THAT AS PER SECTION 2(47) ANY TRANSACTION INVOLVING ALLOWING POSSESSION TO BE TAKEN OR RETAINED IN PART PERFORMANCE OF A CONTRACT OF THE NATURE REFERRED IN SECTION 53A OF TRANSFER OF PROPERTY ACT WOULD COME WITHIN THE AMBIT OF SECTION 2(47). IN ORDER TO ATTRACT SECTION 53A, THE CONDITIONS IS THAT THE CONTRACT IS IN WRITING , IT SHOULD BE SIGNED BY THE TRANSFEROR AND PERTAINS TO IMMOVABLE PROPERTY AND THE TRANSFEREE SHOULD HAVE TAKEN POSSESSION OF THE PROPERTY AND HE IS READY AND WILLING TO PERFORM HIS PART OF CONTRACT. THE LD. CIT(A) HELD THAT MAIN AGREEMENT AND EVIDENCE FOR BINDING THE PARTIES IS THE PARTNERSHIP DEED. THE PARTNERSHIP DEED CONTAINS THE SIGNATURE OF ALL THE PARTIES OF SELLER AND PURCHASER. THE SALE CONSIDERATION IS CLEARLY DISCERNIBLE. THE POSSESSION OF THE LAND IS WITH THE FIRM IS ALSO EVIDENCED BY THE PARTNERSHIP DEED DATED 01.11.2010. THE INITIAL PAYMENT AS PER THE SALE DEED IS IN OCTOBER 2010. THE FIRM-DRB RAVANI DEVELOPER IS SHOWING THE LAND IN ITS AUDITED FINANCIAL STATEMENT FOR A.Y. 2011- 12. FURTHER THE WORK IN PROGRESS IS SHOWN IN THE ACCOUNTS OF THE FIRM. THE BOOKING OF THE FLATS ON THE PROJECT ON THE LAND OF RS. 4.50 CRORE IS BEING OFFERED IT (SS) A NO.226 & 227/AHD/2017 SHRI HINTENDRADULLABHBHAI PATEL (AYS 2011-12 & 2013-14) 10 TO TAX WHICH HAS BEEN ACCEPTED IN ASSESSMENT ORDER UNDER SECTION 143(3) DATED 22.03.2013. ACCORDINGLY THE LD. CIT(A) DIRECTED THAT NO CAPITAL GAIN ON TRANSFER OF THE IMPUGNED LAND CAN BE TAXED IN A.Y. 2013-13. THUS, AGGRIEVED BY THE ORDER FOR BOTH THE ASSESSMENT YEARS THE REVENUE HAS FILED THESE APPEALS BEFORE THE TRIBUNAL. 11. WE HAVE HEARD THE SUBMISSIONS OF THE LEARNED COMMISSIONER OF INCOME TAX DEPARTMENTAL REPRESENTATIVE (CIT-DR) FOR THE REVENUE AND THE LEARNED SENIOR COUNSEL FOR THE ASSESSEE AND HAVE GONE THROUGH THE ORDERS OF THE LOWER AUTHORITIES. WITH REGARD TO DELETING THE ADDITIONS IN AY 2011-12, THE LD CIT- DR FOR THE REVENUE SUBMITS THAT FOR THE YEAR UNDER CONSIDERATION, THE ASSESSEE FILED HIS RETURN OF INCOME UNDER SECTION 139(4) ON 27.03.2013, WHICH IS THE EXTENDED TIME PERIOD FOR FILING RETURN OF INCOME. A SEARCH AND SEIZURE ACTION UNDER SECTION 132 WAS CARRIED OUT BY THE INVESTIGATION WING OF THE REVENUE ON 27.12.2012 ON LAND AND BUILDER GROUP. THE ASSESSEE WAS ONE ON THE RELATED PARTY IN THE GROUP. A NOTICE UNDER SECTION 153C DATED 16.09.2014 WAS SERVED UPON THE ASSESSEE TO FURNISH HIS RETURN OF INCOME. THE ASSESSING OFFICER MADE ADDITION AFTER GRANTING OPPORTUNITY TO THE ASSESSEE. THE LD CIT(A) DELETED THE ADDITION BY TAKING VIEW THAT THE ADDITIONS ARE NOT BASED ON THE INCRIMINATING EVIDENCE FOUND DURING THE SEARCH. THE CASE LAWS RELIED BY THE ASSESSEE IN SUPPORT OF ADDITIONAL GROUNDS OF APPEAL WERE BASED ON THE RETURN OF INCOME IT (SS) A NO.226 & 227/AHD/2017 SHRI HINTENDRADULLABHBHAI PATEL (AYS 2011-12 & 2013-14) 11 FILED UNDER SECTION 139(1) OF THE ACT. THE LD CIT-DR FOR THE REVENUE PRAYED FOR REVERSAL OF THE DECISION OF THE LD CIT(A) AND TO RESTORE THE ORDER OF ASSESSING OFFICER. 12. ON DELETING THE ADDITION OF LONG TERM CAPITAL GAIN IN AY 2013-14, THE LD CIT- DR FOR THE REVENUE SUBMITS THAT THERE WAS NO PERFORMANCE OF SALE OF THE LAND IN AY 2011-12. THE TRANSFER OF THE LAND, ON THE SALE PROCEED OF WHICH THE ASSESSEE CLAIMED LTCG WAS IN FACT TRANSFER DURING AY 2013-14, BY WAY OF SALE DEED DATED 09.11.2012 AND THE CORRECT YEAR OF TAXATION OF SUCH LONG TERM CAPITAL GAIN IN THE YEAR WHEN THE ASSET WAS ACTUALLY TRANSFERRED. THE ASSESSEE CANNOT CHOOSE THE YEAR OF TAXABILITY AS PER HIS CONVENIENCE. 13. ON THE OTHER HAND THE LD. SR. COUNSEL OF THE ASSESSEE WHILE OPPOSING THE GROUNDS OF APPEAL FOR AY 2011-12, SUPPORTED THE ORDER OF THE LD CIT(A). THE LEARNED SR COUNSEL FOR THE ASSESSEE SUBMITS THAT THE ASSESSEE FIELD HIS RETURN OF INCOME ON 27.03.2012. THE NOTICE UNDER SECTION 153C DATED 16.09.2014 WAS SERVED UP ON THE ASSESSEE. WHEN THE NOTICE UNDER SECTION 153C WAS SERVED, THE TIME LIMIT FOR ISSUING THE NOTICE UNDER SECTION 143(2) HAD ALREADY EXPIRED. THUS, NO ASSESSMENT FOR THAT YEAR WAS PENDING AT THE TIME OF SERVICE OF NOTICE UNDER SECTION 153C. THE ASSESSING OFFICER WHILE RECORDING THE SATISFACTION UNDER SECTION 153C, REFERRED ABOUT THE DOCUMENTS RELATED TO THE CANCELLATION OF SALE DEEDS OF AND SADAKAT OF DIFFERENT LANDS FOUNDS DURING THE SURVEY ACTION ON IT (SS) A NO.226 & 227/AHD/2017 SHRI HINTENDRADULLABHBHAI PATEL (AYS 2011-12 & 2013-14) 12 A SAI LEELA ASSOCIATES. THEREFORE, NONE OF THE ADDITIONS MADE IN THE ASSESSMENT IS BASED ON INCRIMINATING MATERIAL AND THE LD CIT(A) AFTER CONSIDERING THE FACTS OF THE CASE THAT NO INCRIMINATING MATERIAL WAS RECOVERED FOR MAKING SUCH ADDITION IN THE ASSESSMENT ORDER. IN SUPPORT OF HIS SUBMISSION THE LEARNED SENIOR COUNSEL RELIED ON THE DECISION IN VIJAY ASSOCIATES VS DCIT (ITA NO. 153 /AHD/ 2012). 14. IN ALTERNATIVE SUBMISSIONS THE LD. SENIOR COUNSEL FOR THE ASSESSEE SUBMITS THAT SEARCH AND SURVEY ACTION ON LAND AND BUILDER AND RAVANI BUILDER WAS CARRIED ON 27.12.2012. THE NOTICE UNDER SECTION 153C DATED 16.09.2014 WAS ISSUED TO THE ASSESSEE AFTER NINETEENTH MONTH. THE ASSESSMENT WAS COMPLETED ON 27.03.2015, WHICH IS BEYOND THE TIME PERIOD PRESCRIBED IN THE PROVISO OF SECTION 153B FOR COMPLETING THE ASSESSMENT UNDER SECTION 153C, BASED ON THE SEARCH ACTION ON 27.12.212. 15. FOR SUPPORTING THE ORDER OF LD CIT(A) IN AY 2013-14, AND OPPOSING THE GROUNDS OF APPEAL RAISED BY THE REVENUE, THE LD SENIOR COUNSEL SUBMITS THAT THE ASSESSEE IS BASICALLY AGRICULTURIST AND HAVE NO EXPERIENCE OF REAL ESTATE DEVELOPMENT. THE ASSESSEE ALONG WITH HIS SEVEN CO-OWNERS WERE HAVING AGRICULTURAL LAND IN BHIMRAD VILLAGE, BEARING A PLOT NO. 4 & 5 TPS FILE (VESU BHIMRAD) KNOWN AS VESU LAND. EACH OF THE CO-OWNERS WERE HAVING SHAREHOLDING OF 12.5% IN SAID LAND. THE TOTAL ACTUAL AREA OF VESU LAND WAS IT (SS) A NO.226 & 227/AHD/2017 SHRI HINTENDRADULLABHBHAI PATEL (AYS 2011-12 & 2013-14) 13 32064 SQ. MTS, OUT OF THE TOTAL AREA 17307 SQ. MTS WAS SOLD BY ASSESSEE WITH SEVEN OTHER CO-OWNERS DURING THE YEAR UNDER CONSIDERATION. THE AREA OF 8653.509 SQ.MTAREA WAS SOLD BY ASSESSEE WITH SEVEN OTHER CO-OWNERS WITH MUTUAL AGREEMENT TO RAJKUMAR KARAMSHIBHAI RAVANI AND ELEVEN OTHER PARTIES ON 25.10.2010 FOR CONSIDERATION OF RS.6.05 CRORES. IT WAS ARGUED THAT RAJ KUMAR KARAMSHIBHAI RAVANI AND OTHER CO-OWNER OF SAID LAND INTRODUCED THE LAND TO THEIR PARTNERSHIP FIRM THROUGH PARTNERSHIP DATED 08.10.2010 FOR A SALE CONSIDERATION OF RS.6.05 CRORES. THE JANTRY RATE OF LAND DURING THAT TIME WAS RS.7,000/- PER SQ.MT. THE ASSESSEES SHARE BEING 12.5% OF SALE PROCEED WAS RS.75,72,000/-. ANOTHER REMAINING AREA OF 8653.50 SQ.MT. WAS INTRODUCED BY ASSESSEE AND SEVEN OTHER CO-OWNERS AS CAPITAL INTRODUCTION IN THE PARTNERSHIP FIRM, M/S DRB RAVANI DEVELOPERS. THE LAND VALUE RECORDED IN THE BOOKS OF ACCOUNT OF FIRM WAS RS.60,576,000/- AND THE ASSESSEES SHARE BE 12.5% WAS RS.75,72,000/-. THE TOTAL LAND CONTRIBUTION BY OR TWENTY PARTNERS BECAME 17307 SQ.MTS, ON WHICH PROJECT OF CALLESTRIAL DREAMS WAS STARTED. ALL THE CO-OWNERS HAD DULY PAID TAX ON THE SALE OF LAND IN A.Y 2011-12. 16. THE LEARNED SENIOR COUNSEL SUBMITS THAT THE ASSESSEE HAD SHOWN LONG TERM CAPITAL GAINS OF RS.1.45 CRORES IN AY 2011-12. IT WAS SUBMITTED THAT ON INTRODUCTION OF LAND BY ALL PARTNERS TO THE FIRM, POSSESSION OF LAND WAS GIVEN ON 01.11.2010 AND CONSTRUCTION WAS STARTED BY FIRM IN AY 2011-12. THE FIRM- IT (SS) A NO.226 & 227/AHD/2017 SHRI HINTENDRADULLABHBHAI PATEL (AYS 2011-12 & 2013-14) 14 DRB RAVANI DEVELOPERS HAD SHOWN THE LAND AS STOCK-IN-TRADE IN THE BALANCE- SHEET IN A.Y. 2011-12. IT WAS ARGUED THAT ONE OF THE FAMILY MEMBERS OF ASSESSEE FILED A CIVIL SUIT AND OBTAINED A STAY ORDER FROM CIVIL COURT, AGAINST THE TRANSFER OF LAND AND DUE TO INJUNCTION ORDER ON SALE OF THE PORTION OF LAND, SALE DEED COULD NOT BE EXECUTED IN AY 2011-12, THE COPY OF STAY ORDER IS PLACED ON RECORD. THE CIVIL DISPUTE WAS CLEARED IN AY 2012-13 AND THE SALE DEED WAS EXECUTED ON 09.11.2012 AT STAMP DUTY APPLICABLE ON THAT DAY AT RS.6.06 CRORE. COPY OF SALE DEED WAS ALSO FURNISHED. THE LEARNED SENIOR COUNSEL FURTHER SUBMITTED THAT THE ASSESSEE AND ALL OTHER SEVEN CO-OWNERS SHOWN CAPITAL GAINS IN A.Y. 2011-12 AS POSSESSION WAS ALREADY HANDED OVER TO RAJKUMAR RAVANI, ONLY THE CONVEYANCE DEED WAS EXECUTED IN AY 2013-14 DUE TO INJUNCTION ORDER BY CIVIL COURT. THE LD. SENIOR COUNSEL FOR THE ASSESSEE PRAYED FOR DISMISSAL OF THE APPEAL FOR BOTH THE YEARS. 17. THE ASSESSEE HAS FILED FOLLOWING DOCUMENTS ON RECORD. SL.NO. PARTICULARS 1 PARTNERSHIP DEDUCTION OF FIRM M/S DRB RAVANI DEVELOPERS 2 CHART SHOWING CAPITAL GAIN CALCULATION OF CO - OWNERS OF LAND AT VESU 3 RETURNS OF INCOME OF ALL CO - OWNERS OF LAND AT VESU 4 CHART SHOWING JANTRI VALUE OF LAND AT VESU 5 AUDITED ANNUAL ACCOUNTS OF DRB RAVANI DEVELOPERS FOR AY 2011-12 6 STAY PAPERS OF LAND AT VESU 7 SALE DEED OF LAND AT VESU 8 NOTICE DATED 19/03/2015 ISSUED U NDER S ECTION 142(1) OF THE ACT 9 SUBMISSION DATED 24/03/2015 IN RESPONSE TO ABOVE NOTICE 10 SUMMONS TO ASSESSEE U NDERSECTION 131 OF THE ACT ISSUED ON IT (SS) A NO.226 & 227/AHD/2017 SHRI HINTENDRADULLABHBHAI PATEL (AYS 2011-12 & 2013-14) 15 11/09/2014 11 ASSESSMENT ORDER OF M/S DRB RAVANI DEVELOPERS FOR AY 2011 - 12 12 COPY OF STATEMENT RECORDED OF DILIPBHAI RAVANI 13 SATAKHAT COPY OF BLOCK NO. 127 14 STATEMENT RECORDED UNDER SECTION 131 OF ASSESSEE ON 30.03.2013 15 FOR NO. 7/12 OF BLOCK NO. 127 16 SALE DEED OF BLOCK NO. 127 17 SATAKHAT OF BLOCK NO. 141 18 FORM NO.7/12 OF BLOCK NO. 141 19 SALE DEED OF BLOCK NO.141 20 SATAKHAT OF BLOCK NO. 238 21 SALE DEED OF BLOCK NO.238 22 WRITTEN SUBMISSIONS BEFORE LD. CIT(A) FOR A.Y 2011 - 12 23 WRITTEN SUBMISSIONS BEFORE LD. CIT(A) FOR A.Y 2013 - 14 18. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS OF THE PARTIES AND HAVE GONE THROUGH THE ORDERS OF THE LOWER AUTHORITIES. WE HAVE ALSO DELIBERATED ON THE VARIOUS CASE LAWS RELIED BY THE LOWER AUTHORITIES AND THE LEARNED SENIOR COUNSEL FOR THE ASSESSEE. THERE IS NO DISPUTE THAT THE ASSESSEE FILED HIS RETURN OF INCOME FOR AY 2011-12 ON 27.03.2013 UNDER SECTION 139(4). THE TIME LIMIT FOR ISSUING NOTICE UNDER SECTION 142(3) WAS EXPIRED ON 30.092013. THE ASSESSING OFFICER AFTER RECORDING SATISFACTION, ISSUED NOTICE UNDER 153C DATED 16.09.2014. ADMITTEDLY, NO ASSESSMENT FOR AY 2011-12 WAS PENDING WHEN NOTICE UNDER SECTION 153C WAS SERVED ON THE ASSESSEE. IN OTHER WORDS THE ASSESSMENT FOR THIS YEAR WAS NOT ABETTED. IN RESPONSE TO THE NOTICE UNDER SECTION 153C FILED HIS RETURN OF INCOME ON 16.03.2015 DECLARING INCOME OF RS.1,57,36,090/-. NO ADDITIONAL INCOME WAS OFFERED BY THE ASSESSEE IN THE RETURN FILED IN RESPONSE TO THE NOTICE UNDER SECTION 153C. THE ASSESSMENT ORDER WAS PASSED WITHIN ELEVEN IT (SS) A NO.226 & 227/AHD/2017 SHRI HINTENDRADULLABHBHAI PATEL (AYS 2011-12 & 2013-14) 16 DAYS OF FILING RETURN OF INCOME AND SERVICE OF NOTICE UNDER SECTION 143(2) DATED 16.03.2015. THE ASSESSING OFFICER MADE VARIOUS ADDITIONS WHILE PASSING THE ASSESSMENT ORDER INCLUDING CERTAIN ADDITIONS ON SUBSTANTIVE AS WELL AS PROTECTIVE BASIS IN THE ASSESSMENT ORDER PASSED UNDER SECTION 143(3) RWS 153C ON 27.03.2015. BEFORE LD CIT(A), THE ASSESSEE BESIDES CHALLENGING THE ADDITIONS ON FACTUAL BASIS ALSO RAISED ADDITIONAL GROUND OF APPEAL THAT THE ADDITIONS MADE IN THE ASSESSMENT IS NOT BASED ON ANY INCRIMINATING EVIDENCE FOUND DURING THE SEARCH ON THE RAVANI GROUP. ON FILING ADDITIONAL GROUND OF APPEAL, THE ASSESSING OFFICER WAS DIRECTED TO FILE HIS REPLY. THE ASSESSING OFFICER FILED HIS REPLY DATED 24.102016 BEFORE LD CIT(A). THE LEARNED CIT(A) AFTER CONSIDERING THE REPLY OF ASSESSING OFFICER ADMITTED THE ADDITIONAL GROUNDS OF APPEAL. 19. THE LD CIT(A) AFTER CONSIDERING THE DETAILED SUBMISSIONS OF THE ASSESSEE ON VARIOUS ADDITIONS HELD THAT THE TIME LIMIT FOR ISSUANCE OF NOTICE UNDER SECTION 143(2) HAD ALSO EXPIRED WHEN THE SATISFACTION WAS RECORDED ON 16.09.2014 FOR ISSUANCE OF NOTICE UNDER SECTION 153C. THE LD. CIT(A) HELD THAT THE ADDITIONS MADE BY ASSESSING OFFICER IN ASSESSMENT FOR AY 2011-12 ARE NOT BASED ON ANY EVIDENCE, BELONGING TO THE ASSESSEE FOUND DURING THE SEARCH. IT WAS ALSO HELD THAT ALL THE ADDITIONS ARE BASED ON THE COPY OF DRAFTS OF STATAKHAT (AGREEMENT) OF DIFFERENT LANDS WHICH WERE IMPOUNDED DURING THE COURSE OF SURVEY UNDER IT (SS) A NO.226 & 227/AHD/2017 SHRI HINTENDRADULLABHBHAI PATEL (AYS 2011-12 & 2013-14) 17 SECTION 133A FROM THE PREMISES OF A SAI LEELA ASSOCIATE, 302, SNS HOUSE-3 ATHWALINES, SURAT. THE LD. CIT(A) ALSO HELD THAT NO ADDITION MADE ON THE BASIS OF DOCUMENT WHICH WERE BELIEVED TO BELONGING TO THE ASSESSEE WHILE RECORDING SATISFACTION. IT IS SETTLED LAW THAT NO ADDITION CAN BE MADE IN THE UNABATED ASSESSMENT IN ABSENCE OF EVIDENCE FOUND DURING THE SEARCH. DURING THE HEARING BEFORE US, NO EVIDENCE OR MATERIAL WAS BROUGHT TO OUR NOTICE THAT ANY OF THE ADDITION EITHER ON SUBSTANTIVE OR ON PROTECTIVE IS BASED ON EVIDENCE FOUND DURING THE SEARCH. WE FURTHER FIND THAT THE ORDER OF LD CIT(A) IS IN CONSONANCE WITH THE DECISIONS OF JURISDICTIONAL HIGH COURT IN SAUMYA CONSTRUCTION (P) LTD. (SUPRA), DELHI HIGH COURT IN KABUL CHAWLA (SUPRA) AND BOMBAY HIGH COURT IN CONTINENTAL WAREHOUSING (NHAVA SHEVA) LTD (SUPRA), WHICH WE AFFIRM. THUS, IN VIEW OF THE AFORESAID DISCUSSIONS, WE DO NOT FIND ANY MERITS IN THE GROUNDS OF APPEAL RAISED BY THE REVENUE. CONSIDERING THE FACTS THAT WE HAVE AFFIRM THE ORDER OF LD CIT(A) ON PRIMARY SUBMISSIONS OF THE PARTIES, THEREFORE, THE DISCUSSIONS ON THE ALTERNATIVE SUBMISSIONS OF THE LEARNED SENIOR COUNSEL ON THE POINT OF LIMITATION HAVE BECOME ACADEMIC. 20. IN THE RESULT, THE APPEAL OF REVENUE FOR AY 2011-12 IS DISMISSED. 21. NOW ADVERTING TO THE APPEAL FOR AY 2013-14. THE ASSESSING OFFICER WHILE PASSING THE ASSESSMENT ORDER FOR AY 2011-12 WITHDREW THE LTCG AND DIRECTED TO TAX IT IN AY 2013-14. AS NOTED ABOVE THE ASSESSEE FILED DETAILED WRITTEN IT (SS) A NO.226 & 227/AHD/2017 SHRI HINTENDRADULLABHBHAI PATEL (AYS 2011-12 & 2013-14) 18 SUBMISSIONS BEFORE LD CIT(A) FOR JUSTIFICATION OF OFFER OF LTCG IN AY 2011- 12. THE LD CIT(A) ON CONSIDERATION OF SUBMISSIONS OF THE ASSESSEE FIND THAT HELD THAT AS PER SECTION 2(47) ANY TRANSACTION INVOLVING ALLOWING POSSESSION TO BE TAKEN OR RETAINED IN PART PERFORMANCE OF A CONTRACT OF THE NATURE REFERRED IN SECTION 53A OF TRANSFER OF PROPERTY ACT WOULD COME WITHIN THE AMBIT OF SECTION 2(47). IT WAS ALSO HELD THAT IN ORDER TO ATTRACT SECTION 53A, THE CONDITIONS IS THAT THE CONTRACT IS IN WRITING , IT SHOULD BE SIGNED BY THE TRANSFEROR, PERTAINS TO IMMOVABLE PROPERTY AND THE TRANSFEREE SHOULD HAVE TAKEN POSSESSION OF THE PROPERTY AND HE IS READY AND WILLING TO PERFORM HIS PART OF CONTRACT. THE LD. CIT(A) HELD THAT MAIN AGREEMENT AND EVIDENCE FOR BINDING THE PARTIES IS THE PARTNERSHIP DEED, WHICH CONTAINS THE SIGNATURE OF ALL THE PARTIES OF SELLER AND PURCHASER AND CONSIDERATION IS CLEARLY DISCERNIBLE. THE POSSESSION OF THE LAND IS WITH THE FIRM IS ALSO EVIDENCED BY THE PARTNERSHIP DEED DATED 01.11.2010 AND INITIAL PAYMENT AS PER THE SALE DEED IS IN OCTOBER 2010. 22. BEFORE US THE LD CIT-DR FOR THE REVENUE VEHEMENTLY SUBMITTED THAT NO PERFORMANCE OF TRANSFER OF LAND IN AY 2011-12 AND THAT THE SALE DEED OF THE IMPUGNED LAND WAS EXECUTED DURING THE PERIOD FALLS IN AY 2013-13. HOWEVER, THE LEARNED SENIOR COUNSEL FOR THE ASSESSEE WHILE EXPLAINING THE FACT SUBMITTED THAT ASSESSEE ALONG WITH HIS SEVEN CO-OWNERS OF LAND DURING THE ASSESSMENT IT (SS) A NO.226 & 227/AHD/2017 SHRI HINTENDRADULLABHBHAI PATEL (AYS 2011-12 & 2013-14) 19 YEAR 2011-12 BY MUTUAL AGREEMENT TO RAJKUMAR KARAMSHIBHAI RAVANI AND ELEVEN OTHER PARTIES ON 25.10.2010 FOR CONSIDERATION OF RS.6.05 CRORES. RAJ KUMAR KARAMSHIBHAI RAVANI AND OTHER CO-OWNER OF SAID LAND INTRODUCED THE LAND TO THEIR PARTNERSHIP FIRM THROUGH PARTNERSHIP DATED 08.10.2010 FOR A SALE CONSIDERATION OF RS.6.05 CRORES AND ANOTHER REMAINING AREA OF 8653.50 SQ.MT. WAS INTRODUCED BY ASSESSEE AND SEVEN OTHER CO-OWNERS AS CAPITAL INTRODUCTION IN THE PARTNERSHIP FIRM, M/S DRB RAVANI DEVELOPERS. THE LAND VALUE RECORDED IN THE BOOKS OF ACCOUNT OF FIRM WAS RS.60,576,000/- AND THE ASSESSEES SHARE BE 12.5% WAS RS.75,72,000/-. THE TOTAL LAND CONTRIBUTION BY OR TWENTY PARTNERS BECAME 17307 SQ.MTS, ON WHICH PROJECT OF CALLESTRIAL DREAMS WAS STARTED AND THAT ALL THE CO-OWNERS HAD DULY PAID TAX ON THE SALE OF LAND IN A.Y 2011- 12. 23. WE FIND MERIT IN THE SUBMISSIONS OF THE LEARNED SENIOR COUNSEL FOR THE ASSESSEE AS THE DRB RAVANI BUILDER STARED PROJECT ON THE LAND INTRODUCED BY THE ASSESSEE AND HIS CO-OWNERS AND RAVANI FAMILY. DURING THE SEARCH THE PARTNER OF THE DRB RAVANI DEVELOPER UNDISCLOSED INCOME OF RS. 4.50 CRORE AND PAID DUE TAX ON THE SAID DISCLOSER. THE REVENUE ACCEPTED THE DISCLOSER AND ACCEPTED THE TAX IN ASSESSMENT ORDER DATED 22.03.2013. DRB RAVANI BUILDER ALSO HAD SHOWN THE LAND IN THEIR BOOKS OF ACCOUNT, WHICH IS NEITHER DOUBTED NOR DISTURBED BY THE REVENUE. FURTHER ALL THE CO-OWNER OF THE ASSESSEE ALSO OFFERED IT (SS) A NO.226 & 227/AHD/2017 SHRI HINTENDRADULLABHBHAI PATEL (AYS 2011-12 & 2013-14) 20 SIMILAR CAPITAL GAIN IN AY 2011-12, WHICH WAS ACCEPTED BY THE REVENUE. THE REVENUE HAS NOT MADE RE-OPENING OF ANY OF THOSE CO-OWNERS, WHICH HAS ATTAINED FINALITY. THUS, IN VIEW OF THE AFORESAID DISCUSSIONS, WE ACCEPT THE SUBMISSION OF THE LD CIT(A), IN ADDITION TO AFFIRM THE ORDER OF LD CIT(A) ON THIS ISSUE. 24. SO FAR AS OBJECTION OF THE LD CIT-DR FOR THE REVENUE THAT THE SALE DEED OF THE IMPUGNED LAND WAS EXECUTED DURING THE PERIOD FALLS IN AY 2013-13 AND THAT THE ASSESSEE CANNOT CHOOSE THE YEAR OF TAXABILITY AS PER HIS CHOICE. CONSIDERING THE FACTS THAT THE REVENUE HAS ACCEPTED THE CAPITAL GAIN IN THE HAND OF OTHER CO- OWNERS IN AY 2011-12, THE POSSESSION OF THE LAND WAS HANDED OVER ON 01.11.2010, THE LAND WAS INTRODUCED AS CAPITAL CONTRIBUTION IN THE FIRM. THE FIRM STARTED ITS DEVELOPMENT ACTIVITIES AND OFFERED INCOME FOR TAXATION. THE ASSESSEE RECEIVED PART CONSIDERATION IN AY 2011-12. FURTHER, THE ASSESSEE AND HIS CO-OWNERS WERE PREVENTED FROM EXECUTING THE SALE DEED IN FAVOUR OF THE PURCHASER, DUE TO INJUNCTION OF CIVIL COURT. THUS, THE LAND WAS SUBSTANTIALLY TRANSFERRED TO THE PURCHASERS IN AY 2011-12. 25. IN THE RESULT THE APPEAL FOR AY 2013-14 IS DISMISSED. 26. ORDER ANNOUNCED ON 30 TH JULY, 2021 AS PER RULE 34(5) OF INCOME TAX APPELLATE TRIBUNAL RULE (1963) BY PLACING RESULT ON NOTICE BOARD. 27. 28. SD/- SD /- ( DR ARJUN LAL SAINI) (PAWAN SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER IT (SS) A NO.226 & 227/AHD/2017 SHRI HINTENDRADULLABHBHAI PATEL (AYS 2011-12 & 2013-14) 21 SURAT, DATED: 30/07/2021 / RAHUL SHARMA SR. P.S (ON TOUR ) COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT(A) 4. CIT 5. DR 6. GUARD FILE TRUE COPY/ BY ORDER / / TRUE COPY / / ASSISTANT REGISTRAR, ITAT, SURAT