IQBAL SINGH,CHANDIGARH vs. ITO, MOHALI

आदेश/ORDER

The present appeal has been filed by the assessee assailing the correctness of the order dated 22.12.2016 of CIT(A)-2, Chandigarh pertaining to 2009-10 assessment year on the following grounds : 1. That the order of the Ld. Commissioner of Income Tax (Appeals) - 2, Chandigarh is defective both in law and facts of the case. 2. That the Ld. CIT (A) - 2, Chandigarh is unjustified in upholding the re-assessment framed u/s 147 r.w.s. 148 of the I.T. Act, 1961 by the Ld. Assessing Officer which is bad in law as the reasons recorded were on the basis of incomplete version of notification without any proof and proper satisfaction. 3. That the Ld. CIT (A) - 2, Chandigarh is unjustified in upholding the order of the Ld. Assessing Officer regarding addition of Rs.30,62,489/- under the head Long Term Capital Gains as the agricultural land sold by the appellant is not a capital asset u/s 2(14) of the I.T. Act, 1961 being beyond the notified limits. This addition is uncalled for and deserves to be deleted. 4. That the Ld. CIT (A) - 2, Chandigarh is unjustified in upholding the order of the Ld. Assessing Officer regarding addition of Rs.30,62,489/- under the head Long Term Capital Gains as the Ld. Assessing Officer has applied his own fair market value of the land as on 01-04-1981 instead of the value taken by the appellant on the basis of valuation report certified by a Government Approved Qualified Valuer. This addition is uncalled for and deserves to be deleted. 5. That the Ld. CIT (A) - 2, Chandigarh is unjustified in upholding the order of the Ld. Assessing Officer as the value of the old building constructed on the agricultural land sold as certified by a Government Approved Qualified Valuer has been ignored during assessment proceedings. This addition is uncalled for and deserves to be deleted.

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evidence itself was declined. It is further seen that the ld. CIT(A) also held that the fresh evidence relied upon could not be admitted as the assessee had not made any request for admission of fresh evidence in terms of Rule 46A of the ITAT Rules, 1963. 7. The ld. Sr.DR was heard qua the nature of assessee's sources of income. It was agreed that the assessee appears to be an agriculturist. Qua the issue as to whether the valuation of land is to be based on the sale instances for the specific period as opposed to valuation carried out by an expert, the ld. Sr.DR though placed reliance upon the order, however, could not make out any argument or offer any justification as to why since the Registered Valuer’s report relied upon by the assessee was to be discarded, the issue was not referred to the DVO. 8. I have heard the submissions and perused the material on record. On a perusal of the record I find that the impugned order cannot be upheld. The reasons for coming to the said conclusion shall be elaborated hereinafter. First and foremost, it is well settled that the dispute on the location and distances of a specific property essential for determining the valuation of the property it cannot be over emphasized that it necessarily has to be decided on the basis of land Revenue Records. It is well settled that in case of dispute between the tax authorities and the assessee, the last word on such an issue has to be the word of the Land Revenue Authorities. The fact that some evidence purportedly of a Patwari is filed at a later date on account of the delay itself cannot be discarded as there can be no debate that the evidence is not only relevant but is also crucial for determining the issue under consideration. I am of the view that ideally it should have been sought for by the tax authorities themselves. Without commenting upon its correctness and completeness, the evidence I hold could not have been outrightly discarded as an afterthought. The specific situation/location of a property at a relevant point of time is not a fact which the assessee can create. In order to address the correctness of facts as canvassed by the assessee, the only acceptable evidence is the Evidence/Report of the Land Revenue Authorities. In case the version of truth canvassed by way of evidence by the assessee is to be disturbed, then appropriate enquiries/information etc. can be sought from the Land Revenue Authorities. A fact is a concrete reality which no amount of reasoning can change and cannot be created. Specific evidence of the location of the property qua the

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issue has to be decided in accordance with law and the report, if any placed by the assessee is directed to be considered appropriately and in case it is found to be not reliable or found wanting, the tax authorities have sufficient powers themselves to call for the report from the relevant Land Revenue Authority and confront the same to the assessee before deciding the issue in accordance with law.

8.1 It would also be appropriate to refer to some relevant facts noticed in the exercise of decision making powers exercised by the Ld. CIT(A). It is seen that admittedly fresh evidence by way of a Valuation Report was filed before the CIT(A) without a proper application. I do not find any reason on record as to why the said authority failed to responsibly advise the tax payer to come by way of a proper application. All assessees do not necessarily have the benefit of expert legal advice but all tax administrators, it is presumed, have been sufficiently equipped by the State to ensure that the powers exercised on its behalf are responsibly exercised. The State expects the tax administrators to act fairly and competently in the performance of their fundamental and onerous duty to collect taxes on its behalf. However, it is well settled and non negotiable that the taxes so to be collected need to satisfy the touchstones of “just” and “due” taxes. The word “just” presupposes “fairness” in the actions of the tax administrators who are acting for and on behalf of the Government of India. The mind set needs to be re- oriented to consciously acknowledge that the duty and power to collect taxes is not being exercised on behalf of an alien foreign power in a colonial state who may have needed to fill its coffers by subjecting its colonies to the arbitrary actions. The power is exercised on behalf of the State and pre- supposes that it is exercised responsibly and fairly.

8.2 In today’s digital world, tax compliances necessarily have increased, with Banks, Land Revenue Authorities being integrated with tax authorities. However, the benefit of actual and complete knowledge of financial nuances and Taxing Statutes coupled with computer literacy has remained restricted to a large extent only to a few experts. The tax authorities constitute some of these few elites who have been equipped by the State by providing training and courses in order to hone the skill and competence with the use of cutting edge technology. I am of the view that the rash attitude of adopting the dangerous policy and philosophy of “us against them” in a free nation is to be strongly repelled and crushed. The ignorance and helplessness of the

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masses who are required to address the values of their inherited property, sales etc. of agricultural lands etc. before the tax authorities glaringly stand out as every day examples of some failure and malaise. The tax administration is not expected to collect taxes based on the ignorances of the assessee but is expected to ensure that in the discharge of their duties and responsibilities, the citizens on behalf of whom the tax administration functions are advised, counseled and guided towards tax compliances. 8.3 In the facts of the present case, the evidence of exact location of the land and the value thereof based on a Valuation Report admittedly was relevant and crucial for deciding the issue and knowing its relevance, the assessee ideally should have been advised to come by way of a proper application. The fact that the assessee was a farmer agriculturist and thus, may not have had the benefit of a proper legal advice at the assessment stage cannot be ruled out. In a fair exercise of power, the said opportunity should have been given by the ld. CIT(A). In the eventuality the value based on the Valuation Report was to be upset, the matter should have been referred to the DVO and not arbitrarily decided. 8.4 Accordingly, in view of the detailed reasons given hereinabove, the evidence is directed to be admitted and in case it is found to be insufficient or incomplete, the ld. CIT(A), it is directed shall call for further evidences if so deemed necessary and confront these to the assessee before passing an order in accordance with law. 8.5 With the above directions/observations, the impugned order is set aside on the issues agitated in ground Nos. 3 to 5 back to the file of the ld. CIT(A) directing him to pass a speaking order in accordance with law after giving the assessee a reasonable opportunity of being heard. Said order was pronounced in the Open Court at the time of hearing itself. 9. In the result, appeal of the assessee is allowed for statistical purposes. Order pronounced in the Open Court on 15.03.2019. Sd/- (�दवा �संह ) (DIVA SINGH) �या�यक सद�य/Judicial Member