PRINCIPAL COMMSSIONER OF INCOME TAX 2 vs. SHITAL PIYUSHBHAI PATEL

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TAXAP/1280/2018HC GujaratGJHC24049113201829 October 2018Bench: HONOURABLE MR. JUSTICE AKIL KURESHI,HONOURABLE MR. JUSTICE UMESH A. TRIVEDI2 pages
AI SummaryDismissed

What did the High Court hold?

The High Court dismissed both Tax Appeals filed by the Revenue. The Court observed that the Tribunal had remanded the issues for fresh consideration by the Assessing Officer and had not made any conclusive observations on the contentious matters. The Tribunal's reasoning for remand included the provision of law allowing the assessee to adopt the fair market value of the property as on 1.4.1981, which could not be denied at any stage. Additionally, the Tribunal noted that the assessee's claim of investing sale proceeds in exemption bonds required verification. Since the Tribunal's order was one of remand and not a final decision on the merits of the claims, the High Court found no reason to interfere with the Tribunal's order.

What were the facts?

These two appeals were filed by the Revenue against a common judgment of the Income Tax Appellate Tribunal (ITAT). The appeals concerned the assessee, Rital R. Patel. The ITAT had remanded proceedings back to the Assessing Officer for two main reasons: to ascertain the fair market value of a property as of April 1, 1981, and to examine the assessee's claim for deduction under Section 54EC of the Income Tax Act. The Revenue's primary contention was that these claims were raised for the first time before the Commissioner of Income Tax (Appeals) and not before the Assessing Officer, and thus the ITAT erred in entertaining them. The ITAT, however, observed that the law permits adopting the fair market value as of April 1, 1981, and that the claim of investment in exemption bonds required verification.

What were the issues?

1. Whether the Tribunal erred in entertaining the assessee's claims regarding the fair market value of the property as on 1.4.1981 and the deduction under Section 54EC, when these claims were allegedly raised for the first time before the CIT(A) and not before the Assessing Officer. Assessee's Contentions: Not recorded in the judgment. Revenue's Contentions: The assessee had not raised the claims concerning the fair market value of the property as on 1.4.1981 and the deduction under Section 54EC before the Assessing Officer. These contentions were raised for the first time before the CIT(A). Therefore, the Tribunal committed an error in entertaining such contentions.

Which sections of the Income-tax Act were involved?

Section 54EC

AI-generated summary — verify with the full judgment below

C/TAXAP/1278/2018 ORDER IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/TAX APPEAL NO. 1278 of 2018 With R/TAX APPEAL NO. 1280 of 2018 ========================================================== PRINCIPAL COMMISSIONER OF INCOME TAX 2, VADODARA Versus RITAL R. PATEL ========================================================== Appearance: MR.VARUN K.PATEL(3802) for the PETITIONER(s) No. 1 for the RESPONDENT(s) No. 1 ========================================================== CORAM: HONOURABLE MR.JUSTICE AKIL KURESHI and HONOURABLE MR.JUSTICE UMESH TRIVEDI

Date : 29/10/2018

ORAL ORDER (PER : HONOURABLE MR.JUSTICE AKIL KURESHI) 1. These two appeals involve the same assessee and arise out of a common judgment of ITAT. Revenue has challenged the judgment of the Tribunal under which for ascertaining the fair market value of the property in question as on 1.4.1981 and for examining the assessee’s claim of deduction under Section 54EC of the Income Tax Act, the Tribunal has remanded the proceedings before the Assessing Officer. The revenue main contention is that the assessee had raised neither of these two claims before the Assessing Officer. For the first time the contentions were raised before the CIT(A). The Tribunal therefore committed an error in entertaining such contention. The Tribunal while remanding the issue observed that the provision of law permit the assessee to adopt fair market value of the property as on 1.4.1981 and the Page 1 of 2

C/TAXAP/1278/2018 ORDER same therefore cannot be denied at any stage. The Tribunal also noted the assessee claimed to have invested sale proceeds in exemption bond and such issue also required verification. 2. Since the Tribunal has remanded the issue for fresh consideration by the Assessing Officer, we see no reason to interfere. Clearly the Tribunal has not made any conclusive observations with respect to the contentious issues. Both Tax Appeals are dismissed. (AKIL KURESHI, J) (UMESH TRIVEDI, J) syed/ Page 2 of 2

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