SHRI DEEPAK AWATRAM VALECHA, MUMBAI V. INCOME TAX OFFICER WARD-4, MUMBAI

MA 294/MUM/2019

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 2611 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 5 month(s) 5 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 29-09-2022
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Next Hearing Date: 29-09-2022
• Assessment Year: 2012-2013
• Appeal Filed On: 24-04-2019
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SONIA KUMAR
• Keywords: Capital Gains
• Section: 254(2)

Judgement Text

THE INCOME TAX APPELLATE TRIBUNAL “SMC” Bench, Mumbai Shri B.R. Baskaran (AM) & Shri Pavan Kumar Gadale (JM) M.A. No. 294/Mum/2019 in I.T.A. No. 321/Mum/2018 (A.Y. 2012-13) Deepak Awatram Valecha Ambika Bhawan Naka Post Neral, Tal-Karjat Raigad-410 101. PAN : ABYPV6787C Vs. ITO, Ward 4 Panvel Raigad (Appellant) (Respondent) Assessee by None Department by Ms. Sonia Kumar Date of Hearing 30.09.2022 Date of Pronouncement 30.09.2022 O R D E R Per B.R.Baskaran (AM) :- The assessee has filed this petition seeking rectification of mistake apparent from record in the order dated 11.10.2018 passed by the Tribunal in ITA No. 321/Mum/2018 relating to AY 2012-13. 2. None appeared on behalf of the assessee, even though the case was adjourned on the earlier occasion on the specific request of the assessee. Further, it is noticed from the record that the Registry has also sent notice to the assessee by registered post intimating about the date of hearing today. Hence, we proceed to dispose of this Miscellaneous Application ex-parte, without presence of the assessee. 3. We have heard the learned DR, who submitted that the assessee, by way of this Miscellaneous Application, is seeking review of the order passed by the Tribunal, which is not permitted under section 254(2) of the Act. Deepak Awatram Valecha 2 4. We have perused the record. The issue that was adjudicated by the Tribunal relates to the taxability of gains arising out of transfer of six plots claimed by the assessee as ‘agricultural land’. The case of the assessee was that the plots were held as agricultural land and agricultural income was also declared from out of these lands. Hence, the capital gains arising there from were claimed as exempt under the Income Tax Act. The Assessing Officer as well as the learned CIT(A) rejected the claim and hence the assessee has filed appeal before the Tribunal. The ITAT also dismissed the appeal of the assessee and the operative portion of the order reads as under:- “10. We have heard rival contentions and carefully gone through the orders of the authorities below. We had also deliberated on the various judicial pronouncements referred by lower authorities in their respective orders as well as cited by learned AR during the course of hearing before us in the context of factual matrix of the case. From the record we found that six plots of agriculture land was bought by the assessee with eight other persons. These plots of land were held for lease by owner and thereafter sold and profit accruing there on was claimed as exempt being income from sale of agricultural land. After analyzing the factual position, the lower authorities reached to the conclusion that intention of the assessee was to earn profit rather than investing in the agricultural land to be used for agricultural purposes. It was also observed that assessee was not at all interested in carrying out any agricultural activity. If it all in case that intention of assessee was to embark on a venture in the nature of trade as distinguished from a capital investment. The CIT(A) has discussed the various judicial pronouncements and also the criteria laid down by Rajasthan High Court in case of Mahaveer Enterprises to the facts of the instant case and reached to the conclusion that assessee alongwith 8 other persons entered into transaction for sale and purchase of land. Intention was not to carry out any agricultural activity as because sale was carried out barely within few months of the acquisition. The CIT(A) also observed that area of land located is being developed for the purpose of Holiday Homes, Farm houses located near to Karjat. The detailed findings so recorded by lower authorities by applying various judicial pronouncements have not been controverted by bringing any positive material on record. Accordingly, we do not find any reason to ITA No.321/Mum/2018 Shri Deepak Awatram Valecha interfere in the order of lower authorities for treating profit on sale of plot of land as business income.” 5. In the Miscellaneous Application, which is running into 21 pages, the assessee has mainly stated that various case laws relied on by the assessee are distinguishable on facts. It was further submitted that the assessee has Deepak Awatram Valecha 3 declared agricultural income out of these lands which has been accepted by the Assessing Officer. Accordingly, it is submitted that the Department has accepted that the lands sold by the assessee were put to agricultural use, which fact has also been noted down by the Tribunal. Accordingly, it is submitted that the Tribunal has committed error in treating gains arising out of sale of agricultural land as taxable. Accordingly, it is prayed to rectify the order or to recall the order for fresh hearing. 6. However, we noticed from the operative portion of the order passed by the Tribunal, which is extracted above, the Tribunal has specifically noticed that the case of the tax authorities was not about the nature of land, i.e., it is there case that the intention of the assessee at the time of purchase of these plots was to earn profit rather than investing in the agricultural land to be used for agricultural purposes. It has been observed that the factual findings recorded by the lower authorities by applying various judicial pronouncements have not been controverted by brining any positive material on record. We noticed that the Tribunal has upheld the factual findings given by the lower authorities that the intention of the assessee while purchasing agricultural land was to earn profit by selling them in future. 7. Thus, we noticed that the Tribunal has taken a conscious view of the matter after duly considering the facts surrounding the same. Accordingly, we agree with the contention of learned DR that the prayer of the assessee made in the Miscellaneous Application would result in the review of the order passed by the Tribunal, which is not permitted under section 254(2) of the Act. Accordingly, we reject the petition filed by the assessee. Deepak Awatram Valecha 4 8. In the result, Miscellaneous Application filed by the assessee is dismissed. Order pronounced in the open court on 30.09.2022. Sd/- Sd/- (PAVAN KUMAR GADALE) (B.R. BASKARAN) JUDICIAL MEMBER ACCOUNTANT MEMBER Mumbai; Dated : 30/09/2022 Copy of the Order forwarded to : 1. The Appellant 2. The Respondent 3. The CIT(A) 4. CIT 5. DR, ITAT, Mumbai 6. Guard File. BY ORDER, //True Copy// (Assistant Registrar) PS ITAT, Mumbai