PRINCIPAL COMMISSIONER OF IN vs. N.JAYAMURUGAN

Tax Case Appeal Nos.845,846,862,864,865,868, 878,879,882,883,892 & 893 of 2019 IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED 25.08.2022 CORAM THE HON'BLE Mr. JUSTICE R. MAHADEVAN AND THE HON'BLE Mr. JUSTICE MOHAMMED SHAFFIQ Tax Case Appeal Nos.845, 846, 862, 864, 865, 868, 878, 879, 882, 883, 892 and 893 of 2019 The Principal Commissioner of Income Tax Central 2 No.108, Mahatma Gandhi Road Chennai 600 034

.. Appellant in all T.C.As Vs. N.Jayamurugan

.. Respondent in all T.C.As Tax Case Appeals filed under Section 260A of the Income Tax Act, 1961 against the common order dated 27.04.2016 passed by the Income Tax Appellate Tribunal, 'B' Bench, Chennai, in respective I.T.A.Nos.2356,2357, 2359 to 2362/Mds/2005 and 480,481,483 to 486/Mds/2016. For Appellant : Mr.Karthik Ranganathan in all T.C.As Standing Counsel For Respondent : Mr.S.Sridhar in all T.C.As 1/6 https://www.mhc.tn.gov.in/judis Tax Case Appeal Nos.845,846,862,864,865,868, 878,879,882,883,892 & 893 of 2019 C O M M O N J U D G M E N T (Judgment was delivered by R. MAHADEVAN, J.) These tax case appeals have been filed by the appellant/Revenue, calling in question the correctness of the common order dated 27.04.2016 passed by the Income Tax Appellate Tribunal, 'B' Bench, Chennai, in I.T.A.Nos.2356, 2357, 2359 to 2362/Mds/2005 and 480, 481, 483 to 486/Mds/2016, for the assessment years 2007-08, 2008-09, 2010-11 to 2013-14, by raising the following substantial questions of law : T.C.A.No.845, 862 of 2019 : “1. Whether the Appellate Tribunal is correct in holding that there is no proof that the assessee has shown non-agricultural income as agricultural, whereas agricultural income, being exempted income, the responsibility to prove that the income claimed as “agricultural income” is derived from agricultural sources and the assessee failed to discharge this proof with all evidences? 2. Whether the Tribunal is right in law in holding sale of land through an unregistered sale agreement as a valid sale in contravention of Section 54 of Transfer of Property Act 1882 and even after amendment of Section 53A of Transfer of Property Act 1882 and amendment of section 17 of the Registration Act 1908? 3. Whether the Tribunal is right in law in holding a land, which passed all the tests laid out by the Hon'ble High Court of Gujarat in the case of CIT vs Siddharth J Desai reported in [1983] 139 ITR 628 (Gujarat) and later approved by the Hon'ble Apex Court in the case of Smt.Sarifabibi Mohmed Ibrahim v CIT [1993] 204 ITR 631] in favour of Revenue, as agricultural land? 2/6 https://www.mhc.tn.gov.in/judis Tax Case Appeal Nos.845,846,862,864,865,868, 878,879,882,883,892 & 893 of 2019 4. Whether ITAT is justified in treating developed 485 residential plots as capital asset instead of stock-in-trade/business asset and treating that the transaction of sale of developed residential plots not as adventure in the nature of trade? 5. Whether on the facts and circumstances of the case the order of the ITAT holding that the profit derived from such sale cannot be considered as business income is not perverse, when the assessee had undertaken a series of transactions of purchase of land and after aggregation and conversion of the same for non-agricultural purposes has sold as developed lay out/residential plots?. 6. Whether the ITAT is correct in law in holding that the profit derived from such sale of land cannot be considered as business income, when as per the sale deed executed on 14.5.2008 by the assessee with the purchaser of the land, the same has been sold at price per sq.ft. basis?” T.C.A.No.846, 864, 865, 868, 878, 879, 882, 892 and 893 of 2019 : “Whether the Appellate Tribunal is correct in holding that there is no proof that the assessee has shown non-agricultural income as agricultural, whereas agricultural income, being exempted income, the responsibility to prove that the income claimed as“agricultural income” is derived from agricultural sources and the assessee failed to discharge this proof with all evidences?” T.C.A.No.883 of 2019 : “1. Whether the Appellate Tribunal is correct in holding that there is no proof that the assessee has shown non-agricultural income as agricultural, whereas agricultural income, being exempted income, the responsibility to prove that the income claimed as “agricultural income” is derived from agricultural sources and the assessee failed to discharge this proof with all evidences? 2. Whether ITAT is correct in holding that the interest 234A is to be charged for every month or part of the month comprised in the period commencing on the day immediately following the expiry of the time allowed in the notice under section 153A to the date of completion of 3/6 https://www.mhc.tn.gov.in/judis Tax Case Appeal Nos.845,846,862,864,865,868, 878,879,882,883,892 & 893 of 2019 assessment u/s 143(3) read with section 153A? 3. Whether on the facts and circumstances of the case and in law, the ITAT is correct in holding that the interest under section 234B would be leviable only on the tax on the total income determined in the order passed under section 143(3) read with section 153-A which exceeds the tax on the total income determined under sub-section (1) of section 143 in response to the notice under section 153A, whereas the provisions of the section 153A does not contemplate processing of return of income under section 143(1) filed in response to notice under section 153A of the Income Tax Act? 4. Whether the ITAT is correct in ignoring the fact that the assessee has not filed any return under section 139 and there was no assessment under section 143(3) earlier and as such the order under section 143(3) read with section 153A is the first assessment made and, therefore, being regarded as is regarded as the regular assessment as per explanation 3 to section 234A. Accordingly, section 234A(3) will not apply and 234A(1) only which is applicable to the facts of this case?” 2. When these matters were taken up for consideration, the learned Standing Counsel for the appellant/Revenue brought to the notice of this court the Circular No.17/2019 dated 08.08.2019, issued by the Central Board Direct Taxes, wherein, it is stipulated that appeals shall not be filed/pursued by the Department before the High Court in cases where the tax effect does not exceed Rs.1,00,00,000/- (Rupees One Crore). It is also submitted that the tax effect in these appeals are less than the threshold limit. 3. In the light of the aforesaid submissions made by the learned Standing 4/6 https://www.mhc.tn.gov.in/judis Tax Case Appeal Nos.845,846,862,864,865,868, 878,879,882,883,892 & 893 of 2019 Counsel for the appellant/Revenue, the present appeals, wherein, the tax effect is said to be less than the monetary limit imposed, are dismissed as withdrawn, keeping open the substantial questions of law for determination in appropriate cases. No costs. [R.M.D,J.] [M.S.Q, J.] 25.08.2022

Index : Yes / No gya To 1.The Deputy Commissioner of Income Tax Central Circle 2(1), Chennai 2.The Commissioner of Income Tax (Appeals)-18 Chennai 3.The Income Tax Appellate Tribunal 'B' Bench, Chennai R. MAHADEVAN, J. AND 5/6 https://www.mhc.tn.gov.in/judis Tax Case Appeal Nos.845,846,862,864,865,868, 878,879,882,883,892 & 893 of 2019 MOHAMMED SHAFFIQ, J. gya Tax Case Appeal Nos.845, 846, 862, 864, 865, 868, 878, 879, 882, 883, 892 and 893 of 2019 25.08.2022

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