NARASIMALU JANAKIRAMAN,CHENNAI vs. ITO CORPORATE WARD-7(2), CHENNAI

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ITA 2757/CHNY/2019Status: DisposedITAT Chennai10 April 2023AY 2013-145 pages

In favour of the Revenue: the assessee's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal found that the assessee failed to provide evidence that the land sold was agricultural land beyond 8 kms from the municipality. Therefore, the capital gains computation was sustained, and the assessee's grounds were rejected.

What were the facts?

The assessee sold an immovable property for Rs. 3,11,30,400 but declared only Rs. 25 lakhs. The AO computed capital gains and disallowed deduction under Section 54F as the investment was in the wife's name. The CIT(A) upheld the capital gains computation but allowed Section 54F deduction.

What were the issues?

Whether the land sold was agricultural land for capital gains tax purposes and eligibility for deduction under Section 54F.

Which sections of the Income-tax Act were involved?

Section 147,Section 54F

AI-generated summary — verify with the full judgment below

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Income Tax Appellate Tribunal, ‘A’ BENCH, CHENNAI

Before: SHRI MAHAVIR SINGH, HON’BLE & SHRI MANJUNATHA. G, HON’BLE

For Respondent: Shri. AR V Sreenivasan, Addl. CIT
Hearing: 10.04.2023Pronounced: 10.04.2023

आदेश /O R D E R

PER MANJUNATHA. G, ACCOUNTANT MEMBER:

1.

This appeal filed by the assessee is directed against the order passed by the Commissioner of Income Tax (Appeals)-7, Chennai, dated 27.08.2019 and pertains to assessment year 2013-14.

:-2-: ITA. No:2757/Chny/2019 2. The assessee has raised the following grounds of appeal: “1. The order dated 27.06.2019 of the Learned CIT(A)- 7, Chennai in 2018-19 for the Assessment year is contrary to facts, opposed to law and untenable.

2. The Ld CIT (A) erred in disallowing the claim of the Appellant that the Agricultural land is situated beyond 8 kms. from the City-limit Municipal limit. For these and other grounds that may be permitted to be adduced before or during the course of hearing. The appellant prays that the appeal be allowed and the order of learned Commissioner of Income Tax (Appeals) be deleted in respect of the grounds not allowed by him.”

3. The brief facts of the case are that, the appellant is an individual and the case was re-opened u/s. 147 of the Income- tax Act, 1961 (hereinafter referred to as “the Act”) for the reason that income chargeable to tax has been escaped assessment. During the course of assessment proceedings, the AO noticed that the assessee has sold an immovable property along with other co-owners for a consideration of Rs. 3,11,30,400/-. However, in the return of income, assessee has admitted consideration of Rs. 25 lakhs only. Therefore, the AO by taking note of details of sale consideration received for transfer of property adopted assessee’s share of consideration at Rs. 51,88,400/- and computed long term :-3-: ITA. No:2757/Chny/2019 capital gains of Rs. 51,52,335/-, after allowing indexed cost of acquisition of Rs. 36,065/-. The AO had also rejected deduction claimed u/s. 54F of the Act for Rs. 25 lakhs, on the ground that the assessee has invested consideration for purchase of another residential house property in the name of his wife and thus, not eligible for the benefit of deduction.

4.

Being aggrieved by the assessment order, the assessee preferred an appeal before the CIT(A). Before the CIT(A), the assessee argued that the impugned land sold by the assessee along with other co-owners is an agricultural land which is situated beyond 8 kms from the limits of local municipality. The assessee had also argued the issue of deduction claimed u/s. 54F of the Act in light of certain judicial precedents. The ld. CIT(A), after considering relevant submissions of the assessee and also taken note of relevant facts, opined that land sold by the assessee is not an agricultural land, because the assessee could not file any evidence to prove that the said land is agricultural land, which is situated beyond 8 kms from the limits of local municipality. However, directed the AO to allow the benefit of deduction u/s. 54F of the Act by following the decision of Hon’ble Jurisdictional High Court of Madras in :-4-: ITA. No:2757/Chny/2019 the case of CIT vs Natarajan (2006) 287 ITR 271. Aggrieved by the CIT(A) order, assessee is in appeal before us.

5.

None appeared for the assessee. We heard the ld. Sr. AR and perused relevant material available on record. We find that the ld. CIT(A) has recorded categorical finding that the assessee could not file any evidence to prove that the impugned land sold by the assessee along with other co- owners is an agricultural land which does not come under the purview of capital gains. The CIT(A) had discussed the issue in light of facts brought out by the AO and arguments advanced by the assessee and came to the conclusion that the remand report called for from the AO with respect to the claim of the assessee, the AO gave his findings that the impugned land is not an agricultural land. The assessee neither filed any evidences nor explained how said land is agricultural land which is outside the scope of capital gains tax. The findings of the facts recorded by the ld. CIT(A) is uncontroverted. The assessee neither appeared nor filed any details. Therefore, we are of the considered view that there is no error in the reasons given by the ld. CIT(A) to sustain computation of capital gains :-5-: ITA. No:2757/Chny/2019 on sale of land and thus, we reject grounds taken by the assessee.

6.

In the result, appeal filed by the assessee is dismissed. Order pronounced in the Open court on 10th April, 2023 at Chennai.

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