SRI.PADAMANARAYANA ASAWA V. THE DEPUTY COMMISSIONEOR OF

ITA/100041/2016

AI Insights

The case involves an appeal by Sri Padamanarayana Asawa, the son and legal heir of Late Ramvallabh Asawa, against the orders passed by the Income Tax Appellate Tribunal, Bengaluru. The appeal was filed under Section 260A of the Income-Tax Act, 1961, challenging the assessment made for the Assessment Year 2004-05. The primary legal issue was whether the assessments were made without proper reference to Sections 10(37) and 145A of the Income Tax Act. The appellant argued that the income from interest and compensation was declared on an accrual basis, which should be reconsidered under the mentioned sections. The Revenue contended that these arguments were not presented at the lower levels and required examination by the Assessing Officer.

• Counselvise Citation: [2019] 140 COUNSELVISE.COM (IT) 732845 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 15-04-2019
• Assessment Year: misc
• Other Referred Cases: Commissioner of Income Tax Vs. Ghanshyam [(2009) 315 ITR 1 (SC)]
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: HIGH COURT
• Department Lawyers: Y V RAVIRAJ
• Assessee Lawyers: M V SESHACHALA; GANGADHAR
• Keywords: Assessment Year 2004-05; Income tax appeal; Re-assessment; Compensation for Transfer of Agricultural Land
• Section: 260A; 10(37); 145A

Judgement Text

"IN THE HIGH COURT OF KARNATAKA DHARWAD BENCH DATED THIS THE 15TH DAY OF APRIL, 2019 PRESENT THE HON’BLE MR. JUSTICE G.NARENDAR AND THE HON’BLE MR. JUSTICE BELLUNKE A.S. I.T.A.NO.100041/2016 BETWEEN : SRI PADAMANARAYANA ASAWA SON & LEGAL HEIR OF LATE RAMVALLABH ASAWA AGED 52 YEARS, R/AT. NO.22, NEHRU COLONY, 4TH CROSS, BALLARI-583103. ... APPELLANT (BY SRI M.V.SESHACHALA SENIOR COUNSEL FOR GANGADHAR J.M., ADVOCATE) AND : 1. THE DEPUTY COMMISSIONEOR OF INCOME-TAX, CIRCLE-I, AAYAKAR BHAVAN, STAFF ROAD, BALLARI-583 102. 2. THE COMMISSIONER OF INCOME-TAX, AAYAKAR BHAVAN, SADEM ROAD, KALABURAGI-585 105. ... RESPONDENTS (BY SRI Y.V.RAVIRAJ, ADVOCATE) THIS INCOME TAX APPEAL IS FILED UNDER SECTION 260A OF THE INCOME-TAX ACT, 1961, PRAYING TO ALLOW THE APPEAL AND SET ASIDE THE ORDERS PASSED BY THE INCOME TAX APPELLATE R 2 TRIBUNAL, BENGALURU IN ITA NO.1045/BANG/2012 & C.O.NO.200/BANG/2015 DATED 18.11.2015 AND CONFIRM THE ORDER OF THE APPELLATE COMMISSIONER. THIS APPEAL COMING ON FOR FURTHER HEARING THIS DAY, G.NARENDAR J., DELIVERED THE FOLLOWING: J U D G M E N T Heard the learned senior counsel Sri Seshachala along with Sri G.M.Gangadhar learned counsel for the appellant and Sri Y.V.Raviraj, Senior standing counsel for the Revenue in detail. 2. The substantial question of law that arises for consideration is: “Whether the appeal requires to be remanded in the light of the fact that assessments have been made without reference to Section 10(37) and 145A of the Income Tax Act?” 3. The learned counsel for the Revenue would vehemently submit that the arguments now being advanced, by placing a reliance on Sections 145A and 10(37) of the Income Tax Act is not the 3 case that was canvassed before the authorities below and that the new case now being canvassed by the appellant requires to be examined by the Assessing Officer, which is not in dispute that is for the Assessment Year 2004-05. The income by way of interest and the compensation amount were declared on accrual basis. That the law with regard to the method of computation of the income came to be settled by the Hon’ble Apex Court in the case of Commissioner of Income Tax Vs. Ghanshyam [(2009) 315 ITR 1 (SC)], wherein the Hon’ble Apex Court was pleased to lay down the law that the computation of income sought to be made on receipt basis. 4. It is not in dispute that under the amended provision of sub-section 37 of section 10 of the Income Tax Act the income in the case of an assessee, being an individual or a Hindu undivided family, any income chargeable under the head “Capital Gains” arising from the transfer of agricultural land and such transfer is by way of 4 compulsory acquisition under any law, or a transfer the consideration for which is determined or approved by the Central Government or the Reserve Bank of India and where such income has arisen from the compensation or consideration for such transfer received by such assessee on or after received, such income would not form part of the total income. 5. Learned counsel for the revenue would vehemently contend that the point now raised by the learned Senior Counsel is not a case that has been canvassed before the Assessing Officer and hence the same requires to be appreciated by the Original Authority. 6. During the course of arguments, the learned Senior counsel placed reliance on the provisions of Section 10(37) of the Income Tax Act which undoubtedly came to be inserted vide amendment dated 01.04.2005 and the provision of 5 Section 145A came to be substituted with effect from 01.04.2010. 7. In that view of the matter, the substantial question of law is answered in the affirmative. 8. Accordingly, the appeal is allowed in part. The order under challenge is set aside. The appeal is remitted back to the competent authority for re-assessment in accordance with law and more particularly with reference to Sections 10(37) and 145A of the Income Tax Act. In that view of the matter, there shall be no order as to costs. Sd/- JUDGE Sd/- JUDGE EM/kmv "