RATNA PRABHA G. SAWAMT, V. ASST CIT 23(1),

MA 174/MUM/2013

• Counselvise Citation: [2013] 124 COUNSELVISE.COM (IT) 0606 (ITAT-MUMBAI)
• Duration Of Justice: 1 month(s) 15 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 28-06-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2008-2009
• Appeal Filed On: 13-05-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: RAJIV KHANTELWAL
• Keywords: Capital asset; Cost of acquisition; Fair market value
• Section: 2(14)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI D BENCH MUMBAI BENCHES, MUMBAI BEFORE SHRI VIJAY PAL RAO, JM & SHRI RAJENDRA, AM MISCELLANEOUS APPLICATION NO. 174/MUM/2013 (ARISING OUT OF ITA NO. 6188/MUM/2011, A.Y. 2008-09) SMT. RATNAPRABHA E. SAWANT, C-2, BILWA KUND CHSL, LBS MARG, MULUND(W), MUMBAI-400082 VS ACIT-23(1), R. NO. 108, C-10, 1 ST FLOOR, B.K.C, BANDRA (E) MUMBAI-51 (APPLICANT) (RESPONDENT) PAN NO. BHFPS4084M ASSESSEE BY MR. RAJIV KHANTELWAL REVENUE BY MR. RAJARSHI DWIVEDY DATE OF HEARING 21 ST JUNE2013 DATE OF PRONOUNCEMENT 28 TH JUNE 2013 ORDER PER VIJAY PAL RAO, JM THIS MISCELLANEOUS APPLICATION BY THE ASSESSEE IS D IRECTED AGAINST THE ORDER DATED 26.3.2013 OF THIS TRIBUNAL WHEREBY THE APPEAL OF THE REVENUE WAS DISPOSED OFF. 2 WE HAVE HEARD THE LD. AR AS WELL AS LD. DR AND CONSIDERED THE RELEVANT RECORD. THE LD. AR OF THE ASSESSEE HAS SUB MITTED THAT WHILE DECIDING THE ISSUE OF AGRICULTURAL LAND FALLS UNDER THE EXCL USION CLAUSE OF SECTION 2(14) OF THE INCOME TAX ACT, THIS TRIBUNAL HAS GIVEN MUCH EM PHASIS ON THE FACT THAT THE LAND IN QUESTION WAS USED FOR EXCAVATION OF SAND AN D NOT FOR AGRICULTURAL PURPOSE BY THE ASSESSEE WHEREAS A MATERIAL FACT ON THIS ASPECT HAS NOT BEEN CONSIDERED I.E. THE EXCAVATION OF THE SAME WAS DONE BY THE PREVIOUS OWNER AS IN MA 174/M/2013 . 2 THE YEAR 1969 AND NOT BY THE ASSESSEE OR HER FATHER AFTER ACQUISITION OF LAND IN QUESTION. HE HAS FURTHER POINTED OUT THAT THE RELEV ANT EVIDENCE TO SHOW THAT THE AGRICULTURAL OPERATIONS WERE CARRIED OUT ON THE LAN D IN QUESTION BY THE FATHER OF THE ASSESSEE AS WELL AS BY THE ASSESSEE HAS NOT BEE N CONSIDERED BY THIS TRIBUNAL WHILE PASSING THE IMPUGNED ORDER. THE LD. AR HAS RE FERRED PAGE NO. 109-138 OF THE PAPER BOOK AND SUBMITTED THAT THE RETURN OF INC OME FILED BY THE FATHER OF THE ASSESSEE CLEARLY SHOWS THAT AN AGRICULTURE INCOME W AS DECLARED WHICH WAS ACCEPTED BY THE DEPARTMENT YEAR AFTER YEAR AND THER EFORE, THERE WAS NO DISPUTE THAT AGRICULTURE OPERATIONS WERE CARRIED OUT BY THE FATHER OF THE ASSESSEE WHICH CONTINUE AFTER THE DEATH OF THE FATHER OF THE ASSES SEE. THEREFORE THE CONCLUSION OF THE TRIBUNAL THAT THE LAND, IN QUESTION WAS NOT USED FOR AGRICULTURAL PURPOSE IS CONTRARY TO THE RELEVANT RECORD/EVIDENCE. HE HAS FU RTHER SUBMITTED THAT THE TRIBUNAL HAS ALSO NOT CONSIDERED THE DECISION OF HO NBLE GUJARAT HIGH COURT IN CASE OF CIT VS SIDDHARTH J. DESAI 139 ITR 628 AS WELL AS IN CASE OF VAKATHI SANJEEVA SETTY VS CIT 120 ITR 21, WHICH HAS BEEN FO LLOWED BY THE COMMISSIONER OF INCOME TAX(APPEALS) IN FAVOUR OF TH E ASSESSEE. 3. THE LD. AR HAS FURTHER SUBMITTED THAT THE REVENU E RECORD BEING 7/12 EXTRACTS SHOWS THAT THE LAND HAS BEEN CULTIVATED FO R GROWING COCONUT TREES AND LAND REVENUE HAS BEEN PAID. THUS, THE LD. AR HAS PL EADED THAT THERE IS AN APPARENT MISTAKE ON RECORD WHICH REQUIRED TO BE REC TIFIED. 4. ON THE OTHER HAND, THE LD. DR HAS VEHEMENTLY OPP OSED TO THE MISCELLANEOUS APPLICATION OF THE ASSESSEE AND SUBMI TTED THAT THE TRIBUNAL HAS MA 174/M/2013 . 3 GIVEN THE FINDING OF FACTS ON MERITS WHICH CANNOT B E REVERSED UNDER THE PROVISIONS OF SECTION 254(2). THUS, THE LD. DR HAS SUBMITTED THAT IF THE RELIEF SOUGHT IN THE MISCELLANEOUS APPLICATION HAS GRANTED , IT WOULD AMOUNT TO REVIEW OF THE EARLIER ORDER OF THIS TRIBUNAL WHICH IS NOT PERMISSIBLE UNDER THE PROVISIONS OF SECTION 254(2), THEREFORE, THE MA OF THE ASSESSEE DESERVES DISMISSAL. 5. HAVING CONSIDERED THE RIVAL SUBMISSIONS AND CARE FULLY PERUSED THE IMPUGNED ORDER AS WELL AS THE RELEVANT RECORD, WE F IND THAT THIS TRIBUNAL, WHILE DECIDING THE ISSUE OF AGRICULTURAL LAND TO BE EXCLU DED FROM THE DEFINITION OF THE CAPITAL ASSET AS PER THE PROVISIONS OF SECTION 2(14 )(III) OF THE INCOME TAX ACT, HAS CONSIDERED THE OBSERVATION OF THE ASSESSING OFF ICER IN THE ASSESSMENT ORDER, REGARDING THE LAND IN QUESTION WAS LEASED FOR EXCAV ATION OF SAND AND THEREFORE, THE SAME WAS NOT USED FOR AGRICULTURAL PURPOSE. AFT ER CONSIDERING THE SAID OBSERVATION OF THE ASSESSING OFFICER AS WELL AS THE DECISIONS OF THE HONBLE SUPREME COURT AND HONBLE JURISDICTION HIGH COURT, IT WAS HELD THAT, MERELY, BECAUSE THE LAND IN QUESTION HAS BEEN SHOWN IN THE REVENUE RECORD AS AGRICULTURAL LAND AS INDICATED IN 7/12 EXTRACT DOES NOT IPSO FACTO ESTABLISH THE FACT THAT THE LAND IN QUESTION WAS ACTUALLY USED FO R AGRICULTURAL PURPOSE. HOWEVER, AS POINTED OUT BY THE LD. AR, WE NOTE THAT THE EXCAVATION OF THE SAND PERTAINS TO THE YEAR 1969 WHICH STATED TO BE PRIOR TO THE ACQUISITION OF THE LAND BY THE FATHER OF THE ASSESSEE. FURTHER, THE FATHER OF THE ASSESSEE STATED TO HAVE DECLARED THE AGRICULTURAL INCOME AS PER THE RETURN OF INCOME FOR THE ASSESSMENT MA 174/M/2013 . 4 YEAR 1974-75 ONWARDS PLACED AT PAGE NO. 109-138 OF THE PAPER BOOK. WE FIND THAT THE RETURN OF INCOME DECLARING AGRICULTURAL IN COME IS A CRUCIAL RELEVANT MATERIAL FOR DECIDING THE ISSUE OF AGRICULTURAL LAN D FALLS UNDER THE EXCLUSION CLAUSE AS PER THE PROVISIONS OF SECTION 2(14) OF TH E INCOME TAX ACT. WE FIND THAT THIS RELEVANT RECORD BEING RETURN OF INCOME FO R THE ASSESSMENT YEAR 1974-75 TO 1986-87 HAS NOT BEEN CONSIDERED BY THIS TRIBUNAL WHILE PASSING BY THE IMPUGNED ORDER. ANOTHER IMPORTANT AND NECESSARY ASP ECT OF THE SUBJECT MATTER REMAINED UNADDRESSED IS REGARDING THE COST OF ACQUI SITION OF THE LAND IN QUESTION. THE ASSESSING OFFICER HAS TOOK THE COST O F ACQUISITION OF THE LAND AT NIL WHICH HAS BEEN CHALLENGED BY THE ASSESSEE BY RA ISING GROUND NO. 4 BEFORE THE COMMISSIONER OF INCOME TAX(APPEALS). THE COMMISSION ER OF INCOME TAX(APPEALS) HAS DECIDED THE ISSUE OF AGRICULTURAL LAND IN FAVOUR OF THE ASSESSEE AND THEREBY IT WAS HELD THAT NO CAPITAL GAIN IS ATT RACTED ON SALE OF THE LAND IN QUESTION. THUS, THE ISSUE OF COST ACQUISITION BECAM E IN FRUCTUOUS AND WAS NOT DECIDED BY THE COMMISSIONER OF INCOME TAX(APPEALS). HOWEVER, ONCE IT IS HELD THAT THE LAND IN QUESTION DOES NOT FALL UNDER THE EXCLUSION CLAUSE OF CAPITAL ASSET U/S 2(14), THEN THE COST OF ACQUISITION IS NE CESSARY CONSEQUENTIAL ASPECT OF THE SUBJECT MATTER. THERE IS NO DISPUTE THAT THE LA ND IN QUESTION WAS ACQUIRED BY THE FATHER OF THE ASSESSEE PRIOR TO 1.4.1981, THERE FORE, THE QUESTION OF COST OF ACQUISITION IS REQUIRED TO BE CONSIDERED BY TAKING INTO ACCOUNT THE FAIR MARKET VALUE AS ON 1.4.1981 AND FURTHER THE BENEFIT OF THE INDEXATION IF ANY ALSO REQUIRED TO BE CONSIDERED. THUS, THE CONSEQUENTIAL ESSENTIAL ASPECT OF THE SUBJECT MA 174/M/2013 . 5 MATTER WAS LEFT OUT FROM THE ATTENTION OF THE BENCH , WHILE DECIDING THE ISSUE OF AGRICULTURAL LAND. 6. IN VIEW OF THE ABOVE FACTS AND CIRCUMSTANCES OF THE CASE WE ARE OF THE CONSIDERED OPINION THAT AN APPARENT MISTAKE HAS CRE PT ON RECORD WHICH IS REQUIRED TO BE RECTIFIED. ACCORDINGLY, IN THE INTER EST OF JUSTICE, WE RECALL THE ORDER DATED 26.3.2003 IN ITA NO. 6188/M/2011 FOR FR ESH CONSIDERATION AND DIRECT THE REGISTRY TO FIX THE APPEAL OF THE REVENU E FOR FRESH HEARING AND CONSIDERATION IN REGULAR COURSE. 7. IN THE RESULT, THE MISCELLANEOUS APPLICATION FIL ED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCEMENT IN THE OPEN COURT ON 28 TH JUNE 2013 SD/- SD/- (RAJENDRA) ACCOUNTANT MEMBER (VIJAY PAL RAO) JUDICIAL MEMBER PLACE: MUMBAI: DATED: 28 TH JUNE 2013 SUBODH COPY FORWARDED TO: 1 APPELLANT 2 RESPONDENT 3 CIT 4 CIT(A) 5 DR /TRUE COPY/ BY ORDER