Shri Kanubhai M. Patel, Ahmedabad V. The ACIT, Central Circle 1(1), Ahmedabad

MA 194/AHD/2018

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 4576 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 9 month(s) 27 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 28-04-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2010-2011
• Appeal Filed On: 01-07-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Revised return; Capital Gains
• Section: 54; 139; 153A; 139(5); 139(1); 139(4); 254(2); 13

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD “D” BENCH Before: Ms. Annapurna Gupta, Accountant Member And Shri Mahavir Prasad, Judicial Member Shri Kanubhai M Patel 602, Shilp Building Near Municipal market C.G. Road, Navrangpura PAN: AEHPP4926P (Appellant) Vs The ACIT, Central Circle-1(1), Ahmedabad (Respondent) Appellant by : Shri M. K. Patel, A.R. Respondent by : Shri Purushottam Kumar, Sr.D.R. Date of hearing : 25-03-2022 Date of pronouncement : 29-04-2022 आदेश/ORDER PER : ANNAPURNA GUPTA, ACCOUNTANT MEMBER:- The present application filed by the assessee seeks rectification in the order passed by the ITAT in the case of the assessee in ITA No. 383/Ahd/2013 pertaining to A.Y. 2010-11 dated 18/01/2018, on account of mistake in the order of the issue of claim of deduction/exemption u/s. 54 of the Act by the assessee being adjudicated without considering the correct facts relating to it and by ignoring the decision cited by the ld. Counsel for the assessee in its favour and on the contrary relying upon a decision which was not even confronted to the assessee during the course of hearing. M.A No. 194/Ahd/2018 (in ITA Nos. 383/Ahd/2013) Assessment Year 2010-11 M..A Nos. 194/Ahd/2018 A.Y. 2010-11 Page No Kanubhai M. Patel vs. ACIT 2 2. The contents of the application filed by the assessee are as under: (1) That the appeal filed by the Department against the assessee above-named for the assessment year 2010-11 bearing ITA No. 383/Ahd/2013 is decided by Hon’ble ITAT, Ahmedabad Bench ‘D” Ahmedabad vide order dated 18.01.2018, whereby the appeal of the Revenue is allowed. 2. The issue is regarding the allowability of deduction u/s. 54 of the Act. The chronology of events which are mentioned in the assessment order as well as the above order of Hon’ble ITAT on page 2, para 3 are as under: - original return filed u/s. 139(1) on 30/06/2010 without claiming deduction u/s. 54. - Search on 05/10/2010 - Revised return filed u/s. 139(4) on 17/03/2011 claiming deduction u/s. 64. - Notice u/s. 153A dated 22/09/2011. - Return filed u/s. 153A on 29/12/2011 claiming the deduction u/s. 54. The scrutiny assessment is also framed on the basis of the return filed u/s 153A of the Act. On perusal of the order of ITAT, it is seen that the reason given for denying the deduction u/s 54 is that the assessee has not utilized the amount of capital gains for purchase of the mew property before filing the return u/s 139(1). It is held on pages 12 and 13 of the order under reference that once the return is filed u/s 139(1), the extended period u/s 139(4) will not be available to the assessee and the amount will only have to be routed through the Capital Account Scheme as per section 54 (2) . With utmost respect, it is submitted that this finding is erroneous as the Hon'ble ITAT has completely overlooked the fact that the claim u/s 54 was made in the return filed in response to notice u/s 153A of the Act. As per the provisions of section 153A(1),which has an overriding effect over section 139 because of the non obstanate clause, once a notice is issued u/s 153A, and the return is filed in response thereto, all the pending assessments will abate and assessment will have to be framed u/s 153A, which has been actually done in this case. Hence, filing of returns u/s 139(1) and 139(4) will become otiose and non-est in law. Hence, the deduction u/s 54 claimed in the return filed u/s 153A was well within the time and allowable as per law. M..A Nos. 194/Ahd/2018 A.Y. 2010-11 Page No Kanubhai M. Patel vs. ACIT 3 3) Further, even on the issue whether having filed the return u/s 139(1), the extended period is available upto the time available to file return u/s 139(4) for appropriating the amount of capital gains for the purchase of new property, the AR of the applicant during the course of hearing has relied and filed a copy of order of co-ordinate Bench "C" of ITAT, Ahmedabad dated 18/10/2016 in the case of Shri Sanjay K. Rana in ITA.No. 996/Ahd/2014, wherein exactly similar issue is decided in favour of the assessee after considering all the judgments on this issue. With utmost respect, this Judgment is not at all referred nor considered By Hon'ble ITAT in the order under reference. According to the decision of Hon'ble Supreme Court in the case of Honda Siel Power Product Ltd 295 ITR 466 (SC), failure to consider' decision of co-ordinate Bench cited by the assessee is a mistake apparent on record within the meaning of section 254(2) of the Act. 4. Hence, it is respectfully prayed that mistakes apparent on record as stated above may kindly be rectified and / or the above order may kindly be recalled, and oblige. 5. Supporting Affidavit is enclosed herewith. 2.1. Briefly stated the contention of the ld. Counsel for the assessee before us was that the ITAT had erred in deciding the issue claim of exemption u/s. 54 of the Act vis a vis the claim made in the returns filed u/s. 139(1) and 139(5) of the Act when it was to be decided in the light of claim made by the assessee in the return filed subsequently in response to notice u/s. 153A of the Act, which was issued as a consequence of the assessee being subjected to search action. That the assessment, in dispute was that framed by the AO considering the return filed by the assessee u/s 153A of the Act. That the impugned year was the year preceding the search year, the assessment of which stood abated and therefore the entire assessment was open and the claim of deduction u/s. 54 in the return filed in response to notice 153A of the Act was in accordance with law as provided u/s 153A of M..A Nos. 194/Ahd/2018 A.Y. 2010-11 Page No Kanubhai M. Patel vs. ACIT 4 the Act .He contended therefore that the adjudication of the issue not being done considering the correct facts tantamounted to a mistake in the order of the ITAT. 3. That even otherwise, while adjudicating the issue on the basis of return filed by the assesse u/s. 139(1) and 139(5) of the Act, the ITAT had referred to the decision of the Co-ordinate Bench in the case of Anita A. Shah vs. ITO in ITA No. 3154/Ahd/2015 for A.Y. 2011-12 dated 18/09/2017 which was not even confronted to the assessee and totally ignored the decision cited by the assessee during the course of hearing being that in the case of Shri Ajay K. Rana in ITA No. 996/Ahd/2014 dated 18/10/2016. 4. For the aforesaid reasons, Ld. Counsel for the assessee has sought recall of the order for adjudication afresh. 3. We have considered the contentions of the Ld. Counsel for the assessee and we have also gone through the impugned order of the ITAT in the case of the assessee. We have noted therefrom that, as rightly pointed out by the ld. Counsel for the assessee, the assesseee’s claim for deduction u/s. 54 of the Act was denied stating that the assessee having already filed its return of income u/s. 139(1) making no such claim, the claim subsequently made in the revised return u/s. 139(5) of the Act could not be entertained. Thus the ITAT adjudicated the issue only vis-à-vis the returns filed 139(1) and 139(5) of the Act. M..A Nos. 194/Ahd/2018 A.Y. 2010-11 Page No Kanubhai M. Patel vs. ACIT 5 4. But the fact ,which finds mention in the order of the ITAT also, is that the assessment was framed considering the return filed by the assessee in response to notice u/s 153A of the Act, in which return the assessee had claimed the deduction. 5. We therefore find merit in the contention of the ld. Counsel for the assessee that the claim of the assessee for deduction u/s. 54 was to be adjudicated vis-à-vis return filed u/s. 153A of the Act and the ITAT having not dealt with the issue in the light of and considering the said fact, the order passed was in error. 6. Further the contention of the ld. Counsel for the assesse that he had relied upon the decision of the ITAT Ahmedabad bench in the case of Sanjay K. Rana (supra), is corroborated by the copy of the order being part of the record. And, as rightly pointed out by the Ld.Counsel for the assessee, the ITAT while deciding the issue against it did not deal with the aforesaid decision at all but relied upon another decision, in the case of Anita A Shah (supra), without even confronting the assessee. 7. The Hon’ble Supreme Court in the case of Honda Siel Power Ltd 295 ITR 466(SC) has held that failure to consider decision of coordinate Bench cited by the assessee is a mistake apparent from record. 8. In view of the above we find merit in the present application filed by the assessee and consider it to be a fit case to recall the order of the ITAT for M..A Nos. 194/Ahd/2018 A.Y. 2010-11 Page No Kanubhai M. Patel vs. ACIT 6 adjudication afresh. The appeal is directed to be fixed for hearing on 25/05/2022. Due notice be issued to both the parties. 9. In the result, Misc. Application field by the assessee is allowed. Order pronounced in the open court on 29 -04-2022 Sd/- Sd/- (MAHAVIR PRASAD) (ANNAPURNA GUPTA) JUDICIAL MEMBER True Copy ACCOUNTANT MEMBER Ahmedabad : Dated 29/04/2022 आदेश कȧ ĤǓतͧलͪप अĒेͪषत / Copy of Order Forwarded to:- 1. Assessee 2. Revenue 3. Concerned CIT 4. CIT (A) 5. DR, ITAT, Ahmedabad 6. Guard file. By order/आदेश से, उप/सहायक पंजीकार आयकर अपीलȣय अͬधकरण, अहमदाबाद