The WTO, Gudivada V. Smt. Kosaraju Ammanna, Gudivada

WTA 1/VIZ/2017

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 3831 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 2 year(s) 3 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-05-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2010-2011
• Appeal Filed On: 12-01-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: K SIVA RAM KUMAR
• Keywords: Capital asset

Judgement Text

WTA NO.1 /VIZAG/2017 SMT. KOSARAJU AMMANNA, GUDIVADA 1 , , IN THE INCOME TAX APPELLATE TRIBUNAL, VISAKHAPATNAM BENCH, VISAKHAPATNAM . , . .. . . . . . ' , % BEFORE SHRI V. DURGA RAO, JUDICIAL MEMBER & SHRI D.S. SUNDER SINGH, ACCOUNTANT MEMBER W.T.A.NO.1/VIZAG/2017 ( / ASSESSMENT YEAR: 2010-11) WEALTH TAX OFFICER WARD-1, GUDIVADA SMT. KOSARAJU AMMANNA, GUDIVADA [PAN NO.AOPPK6798E] ( ' / APPELLANT) ( ()' / RESPONDENT) C.O. NO.30/VIZAG/2017 (ARISING OUT OF W.T.A.NO.1/VIZAG/2017) ( / ASSESSMENT YEAR: 2010-11) SMT. KOSARAJU AMMANNA, GUDIVADA WEALTH TAX OFFICER WARD-1, GUDIVADA ( ' / APPELLANT) ( ()' / RESPONDENT) / APPELLANT BY : SHRI M.N. MURTHY NAIK, DR / RESPONDENT BY : SHRI K. SIVA RAM KUMAR, AR / DATE OF HEARING : 03.07.2018 / DATE OF PRONOUNCEMENT : 11.07.2018 / O R D E R PER D.S. SUNDER SINGH, ACCOUNTANT MEMBER: THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAIN ST ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS), VIJAYAWADA VI DE APPEAL NO.70/CIT(A)/VJA/2014-15 DATED 22.09.2016 FOR THE A SSESSMENT YEAR 2010-11. WTA NO.1 /VIZAG/2017 SMT. KOSARAJU AMMANNA, GUDIVADA 2 2. ALL THE GROUNDS OF APPEAL ARE RELATED TO THE ASS ESSMENT OF WEALTH TAX IN RESPECT OF THE PROPERTY SITUATED AT YENAMALA KUDURU, NEAR VIJAYAWADA, ANDHRA PRADESH. THE ASSESSEE IS HOLDIN G LAND ADMEASURING 0.58.11 CENTS AT YENAMALAKUDURU VILLAGE, NEAR VIJAY AWADA WHICH IS WITH IN THE 8 KMS FROM THE MUNICIPAL CORPORATION LIMITS OF VIJAYAWADA AND CLAIMED THE SAME AS EXEMPT WHILE FILING THE RETURN OF INCOME AS THE SAID LAND WAS AGRICULTURAL LAND. THE A.O. WAS OF THE VI EW THAT SINCE THE LAND IS LOCATED WITHIN THE RADIUS OF 8 KMS. FROM VIJAYAW ADA MUNICIPAL CORPORATION, THE LAND IS EXIGIBLE TO WEALTH TAX BUT NOT EXEMPT AS CLAIMED BY THE ASSESSEE. ACCORDINGLY, THE A.O. ASSESSED TH E VALUE OF THE LAND OF ` 68,06,008/- TO THE WEALTH TAX AS URBAN LAND. 3. AGGRIEVED BY THE ORDER OF THE A.O., THE ASSESSEE WENT ON APPEAL BEFORE THE COMMISSIONER OF INCOME TAX (A) AND ARGUE D THAT THE ASSESSEE IS CARRYING ON AGRICULTURAL OPERATION IN T HE SAID LAND AND ALSO FURNISHED THE EVIDENCE OF ADANGAL COPY AND VRO CERT IFICATE. THE COMMISSIONER OF INCOME TAX (A) ALLOWED THE APPEAL O F THE ASSESSEE, SINCE THE LAND WAS USED FOR AGRICULTURAL PURPOSES A ND IT IS NOT PERMISSIBLE TO CONSTRUCT THE BUILDING ON THE AGRICU LTURAL LAND AS PER EXPLANATION 1(B) CLAUSE (II) OF SECTION 2(EA) OF WE ALTH TAX ACT, 1957. FOR READY REFERENCE, WE EXTRACT RELEVANT PART OF TH E ORDER OF THE LD. CIT(A), WHICH READS AS UNDER: WTA NO.1 /VIZAG/2017 SMT. KOSARAJU AMMANNA, GUDIVADA 3 AS REGARDS LAND ADMEASURING 58.11 CENTS AT YENAMAL KUDURU, APPELLANT ADMITTED THAT THE LAND IS SITUATED WITHIN 8 KILOMETERS FROM THE MUNICIPAL LIMITS OF VIJAYAWADA MUNICIPAL CORPOR ATION. THUS IT IS A CAPITAL ASSET AS PER SEC.2(EA)(V) OF THE ACT. AS PE R THE COPY OF ADANGAL, APPELLANT IS THE OWNER OF THE ASSET IN R.S .NO.1 12-1 (EXTENT 0.50 ACRES) WHICH IS FIT FOR CULTIVATION. AS PER TH E CERTIFICATE OF V.R.O., THE LAND HAS BEEN AGRICULTURAL LAND FROM 2004-05 TO 2015-16 CROP SEASONS. APPELLANT HAS BEEN CULTIVATING PADDY IN TH E SAID LAND. APPELLANT FURTHER ADMITTED AGRICULTURAL INCOME IN I T RETURN FOR ASSESSMENT YEAR 200910 AND ASSESSMENT YEAR 2010-11 IN RESPECT OF THIS LAND ALSO. IN VIEW OF THE ABOVE, THE LAND IS N OT AN ASSET ASSESSABLE FOR WEALTH TAX PURPOSES AS PER EXTANT PROVISIONS FO R THE RELEVANT ASSESSMENT YEAR (I.E.) EXPLANATION (1)(B)(0) OF SEC.2(EA) OF WEALTH TAX ACT, 1957. THE CASE LAW CITED BY ASSESSING OFFICER IN HIS ORDER (I.E.) THE DECISION OF HONBLE TAT COCHIN IN THE CASE OF M EENA JACOB V WTO (2007) REPORTED IN 14 SOT 486 IS DISTINGUISHABLE ON FACTS FROM THAT OF APPELLANT. ASSESSING OFFICER HAS NOT BROUGHT ON REC ORD ANY EVIDENCE TO HOLD THAT THE LAND IS NOT AGRICULTURAL LAND. HENCE, I AM OF THE VIEW THAT THE LAND IS EXEMPT AS PER THEN EXTANT PROVISIONS OF WEALTH TAX ACT. I, THEREFORE, DIRECT THE ASSESSING OFFICER TO DELETE A DDITION OF VALUE OF LAND (I.E.) RS.68,06,008/- FOR WEALTH TAX PURPOSES. 4. WE HAVE HEARD BOTH THE PARTIES, PERUSED THE MATE RIALS AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. THE REVENUES CASE IS THAT THE LAND IN QUEST ION WAS URBAN LAND AND NOT EXEMPT U/S 2(EA) OF THE WEALTH TAX ACT . THE ASSESSEES CASE IS THAT THOUGH THE SAID LAND IS URB AN LAND, NO CONSTRUCTION IS PERMISSIBLE SINCE THE SAID LAND WAS NOT CONVERTED INTO NON-AGRICULTURAL LAND AND THE SAID LAND IS EX EMPT AS PER EXPLANATION 1(B)(II) OF SECTION 2(EA) OF THE WEALTH TAX ACT. THE ASSESSEE ALSO RELIED ON THE DECISION OF THIS TRIBUN AL IN THE CASE OF DEVINENI LAKSHMI VS. WTO WARD-2(3) IN WTA NO.04/VIZ AG/2016, 30 & 31/VIZAG/2017 DATED 4.4.2018. ON THE SIMILAR F ACTS, THE WTA NO.1 /VIZAG/2017 SMT. KOSARAJU AMMANNA, GUDIVADA 4 COORDINATE BENCH OF THIS TRIBUNAL IN THE CASE LAWS CITED (SUPRA) DISMISSED THE APPEAL OF THE REVENUE HOLDING THAT ON AGRICULTURAL LAND, NO CONSTRUCTION IS PERMISSIBLE AS PER EXISTIN G LAWS UNLESS THE AGRICULTURAL LAND IS CONVERTED INTO NON-AGRICULTURA L LAND. FOR READY REFERENCE, WE EXTRACT THE RELEVANT PARAGRAPH OF THE ORDER OF THE TRIBUNAL, WHICH READS AS UNDER: 4. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE M ATERIAL PLACED ON RECORD. THE ASSESSEE'S CASE IS THAT BOTH THE PIE CES OF LAND LOCATED AT ENIKEPADU AND NIDAMANURU ARE AGRICULTURAL LANDS AND EXEMPT U/S 2(CA) OF WEALTH TAX ACT THE REVENUE'S CASE IS THAT BOTH T HE LANDS ARE URBAN LANDS, HENCE NOT EXEMPT U/S 2(EA) OF WEALTH TAX ACT . THE REVENUE HAS ARGUED THAT THE AMENDMENT IS INTRODUCED W.EL 2013, THEREFORE THE CWT(A) HAS MISINTERPRETED THE CLAUSE (1)(B) OF EXPL ANATION (1) TO SECTION 2(EA) OF WEALTH TAX ACT, HENCE ARGUED THAT THE LAND IN QUESTION IS SUBJECT TO WEALTH TAX. THERE IS NO DISPUTE WITH REGARD TO THE NATURE OF THE LAND. THE LAND IS AGRICULTURAL LAND, THE SAME I S BEING SUPPORTED BY THE PASS BOOKS SUBMITTED BY THE ASSESSEE, WHEREIN, IT W AS CLASSIFIED AS DRY AGRICULTURAL LANDS. ON AGRICULTURAL LAND, NO CONSTR UCTION IS PERMISSIBLE AS PER EXISTING LAWS UNLESS THE AGRICULTURAL LAND IS C ONVERTED INTO NON AGRICULTURAL LANDS. THERE WAS NO EVIDENCE BROUGHT O UT BY THE REVENUE ON RECORD TO SHOW THAT THE LANDS WERE CONVERTED AS NON AGRICULTURAL LANDS ON WHICH CONSTRUCTION OF THE BUILDING IS PERMISSIBLE. THEREFORE, WE DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDER OF THE LD. CWT(A) AND THE SAME IS UPHELD. THE REVENUES APPEALS ON THIS GROU ND FOR THE ASSESSMENT YEARS 2007-08, 2008-09 AND 2009-10 ARE D ISMISSED. 5. SINCE FACTS OF THE ASSESSEES CASE ARE IDENTICAL , RESPECTFULLY FOLLOWING THE VIEW TAKEN BY THIS TRIBUNAL (SUPRA), WE HOLD THAT AGRICULTURAL LAND USED FOR AGRICULTURAL PURPOSES CA NNOT BE HELD AS A CAPITAL ASSET FOR THE PURPOSE OF WEALTH TAX ACT. A CCORDINGLY, WE UPHOLD THE ORDER OF THE LD. CIT(A) AND DISMISS THE APPEAL OF THE REVENUE. WTA NO.1 /VIZAG/2017 SMT. KOSARAJU AMMANNA, GUDIVADA 5 6. THE ASSESSEE FILED CROSS OBJECTION (CO) SUPPORTI NG THE ORDER OF THE CIT(A). IN VIEW OF THE DISCUSSION MADE IN THE APPEAL OF THE REVENUE, C.O. FILED BY THE ASSESSEE IS ALLOWED. 7. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED AND THE CROSS OBJECTION FILED BY THE ASSESSEE IS ALLOWED. THE ABOVE ORDER WAS PRONOUNCED IN THE OPEN COURT O N 11 TH JUL18. SD/- SD/- ( . ) ( . .. . . . . . ' ) (V. DURGA RAO) (D.S. SUNDER SINGH) /JUDICIAL MEMBER /ACCOUNTANT MEMBER ! /VISAKHAPATNAM: % /DATED : 11.07.2018 VG/SPS )! *! /COPY OF THE ORDER FORWARDED TO:- 1. / THE APPELLANT THE WEALTH TAX OFFICER, WARD-1, GUDIVADA 2. / THE RESPONDENT SMT. KOSARAJU AMMANNA, D.NO.9/3 35, G.S. PURAM, GUDIVADA, KRISHNA DIST. 3. + / THE CIT, VIJAYAWADA 4. + ( ) / THE CIT (A), VIJAYAWADA 5. ! . , . , ! / DR, ITAT, VISAKHAPATNAM 6 . / GUARD FILE / BY ORDER // TRUE COPY // SR. PRIVATE SECRETARY ITAT, VISAKHAPATNAM