CHINNAM SREEVALLI,BANGALORE vs. PRINCIPAL COMMISSIONER OF INCOME TAX, RAJAHMUNDRY

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ITA 197/VIZ/2018Status: DisposedITAT Visakhapatnam04 July 2019AY 2013-144 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that the Assessing Officer had not properly examined the exemption claim under section 54F and had allowed it without detailed inquiry. Therefore, the Pr.CIT rightly exercised his powers under section 263 to set aside the assessment order.

What were the facts?

The assessee claimed exemption for long-term capital gains under sections 54F and 54BC. The Assessing Officer allowed this exemption without proper verification. The Principal Commissioner of Income Tax (Pr.CIT) found the assessment order erroneous and prejudicial to the revenue.

What were the issues?

Whether the Assessing Officer's allowance of capital gains exemption without proper verification made the assessment order erroneous and prejudicial to the revenue.

Which sections of the Income-tax Act were involved?

Section 54F,Section 54BC,Section 143(3),Section 263

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, VISAKHAPATNAM BENCH, VISAKHAPATNAM

Before: SHRI V. DURGA RAO, HON’BLE & SHRI D.S. SUNDER SINGH, HON’BLESmt. Chinnam Sreevalli, vs.

For Appellant: Shri G.V.N. Hari – Advocate
For Respondent: Shri D.K. Sonawal – CIT DR
Hearing: 01/07/2019

IN THE INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM BENCH, VISAKHAPATNAM BEFORE SHRI V. DURGA RAO, HON’BLE JUDICIAL MEMBER & SHRI D.S. SUNDER SINGH, HON’BLE ACCOUNTANT MEMBER ITA No. 197/VIZ/2018 (Asst. Year : 2013-14) Smt. Chinnam Sreevalli, vs. ITO, Ward-2, Eluru. Plot No. 211, Canara Bank Layout, 6th Main Road, Kodigehalli, Bangalore. PAN No. ADAPC 4277 E (Appellant) (Respondent)

Assessee by : Shri G.V.N. Hari – Advocate. Department By : Shri D.K. Sonawal – CIT DR Date of hearing : 01/07/2019. Date of pronouncement : 04/07/2019. O R D E R PER V. DURGA RAO, JUDICIAL MEMBER

This appeal by the assessee is directed against the order of Principal Commissioner of Income Tax, Rajahmundry, dated 28/03/2018 for the Assessment Year 2013-14. 2. Facts of the case, in brief, are that the assessee is an individual, filed return of income electronically by declaring total income of Rs. 6,79,700/-. Subsequently, case of the assessee was selected for scrutiny under CASS and after following due procedure, assessment was completed u/sec. 143(3) on

2 ITA No.197/VIZ/2018 (Smt. Chinnam Sreevalli)

22/12/2015 assessing the total income at Rs. 7,24,696/-. Subsequently, Pr.CIT while exercising the powers conferred in him u/sec. 263, has noted that the assessee has claimed exemption from long term capital gains u/sec. 54F & 54BC totalling to Rs.1.21 crores on which claim u/sec. 54F was about Rs. 93.34 lakhs. As seen from the record, the exemption was allowed by the Assessing Officer without ascertaining whether the basic condition to allow exemption u/sec. 54F i.e. that the capital gain should be invested in a new residential house is fulfilled or not. The Pr.CIT further found that the order passed by the Assessing Officer is erroneous and prejudicial to the interests of the Revenue for the reason that the claim made by the assessee was allowed without making necessary enquiry and he called the explanation from the assessee. Before the Pr.CIT, the assessee has submitted that all the details were furnished before the Assessing Officer and after examining the entire issue, claim made by the assessee was allowed. However, the Pr.CIT is not accepted the explanation of the assessee and he found that assessment order dated 22/12/2015 is erroneous and prejudicial to the interests of the Revenue and accordingly assessment is set aside and directed the Assessing Officer to examine all the details and pass necessary orders.

3 ITA No.197/VIZ/2018 (Smt. Chinnam Sreevalli)

3.

On appeal before us, ld. counsel for the assessee is unable to point out any mistake or error from the order of the Pr.CIT, dated 28/03/2018. 4. Per contra, ld. Departmental Representative strongly supported the order passed by the Pr.CIT. 5. We have heard both the sides and gone through the details filed by the assessee and also the assessment order. From the assessment order it is very clear that the Assessing Officer has not at all examined the claim of exemption made by the assessee in respect of 54F of the Act and without making a detailed enquiry simply allowed the claim. Thus, we are of the opinion that the Pr.CIT rightly exercised his powers vested with him u/sec. 263 of the Act and set aside the order passed by the Assessing Officer. We find no reason to interfere with the order passed by the Pr.CIT. Thus, this appeal filed by the assessee is dismissed. 6. In the result, appeal filed by the assessee is dismissed. Order Pronounced in open Court on this 04th day of July, 2019.

Sd/- sd/- (D.S. SUNDER SINGH) (V. DURGA RAO) Accountant Member Judicial Member Dated: 04th July, 2019. vr/-

4 ITA No.197/VIZ/2018 (Smt. Chinnam Sreevalli)

Copy to: 1. The Assessee – Smt. Chinnam Sreevalli, Plot No. 211, 6th Canara Bank Layout, Main Road, Kodigehalli, Bangalore. 2. The Revenue – ITO, Ward-2, Eluru. 3. The Pr.CIT, Rajahmundry. 4. The D.R., Visakhapatnam. 5. Guard file. By order

(VUKKEM RAMBABU) Sr. Private Secretary, ITAT, Visakhapatnam.

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