ITO, WARD-4(2), BHUBANESWAR vs. TILOTAMA MISHRA, BHUBANESWAR

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ITA 480/CTK/2017Status: DisposedITAT Cuttack17 May 2018AY 2015-164 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal upheld the CIT(A)'s order deleting the addition. It was noted that the three co-owners had already declared and paid the capital gains tax on the entire sale consideration, and the department had not lost any revenue.

What were the facts?

The Assessing Officer made an addition of Rs. 51,18,920/- as long-term capital gain in the hands of the assessee, despite the assessee claiming her share of sale consideration was received and taxed by her three sons. The assessee, an 88-year-old mother, had relinquished her rights in the property in favor of her sons.

What were the issues?

Whether the entire sale consideration of an immovable property should be taxed as capital gains in the hands of one co-owner when other co-owners have already paid the tax on their respective shares.

Which sections of the Income-tax Act were involved?

Section 45

AI-generated summary — verify with the full judgment below

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Income Tax Appellate Tribunal, CUTTACK BENCH, CUTTACK

Before: S/SHRI N.S SAINI & PAVAN KUMAR GADALE

For Respondent: Shri D.K.Pradhan, DR
Hearing: 17/05

1 ITA No. 480/CT K/ 2017 Asse ssment Year : 20 15- 201 6

IN THE INCOME TAX APPELLATE TRIBUNAL, CUTTACK BENCH, CUTTACK

BEFORE S/SHRI N.S SAINI, ACCOUNTANT MEMBER AND PAVAN KUMAR GADALE, JUDICIAL MEMBER

ITA No.480/CTK/2017 Assessment Year : 2015-2016

Income Tax Officer, Ward - Vs. Smt. Tilotama Mishra, Plot 4(2), Bhubaneswar. No.A/124, Saheed nagar, Bhubaneswar. PAN/GIR No.CZNPM 3072 N (Appellant) .. ( Respondent)

Assessee by : None Revenue by : Shri D.K.Pradhan, DR

Date of Hearing : 17/05/ 2018 Date of Pronouncement : /05/ 2018

O R D E R Per N.S.Saini, AM This is an appeal filed by the revenue against the order of the

CIT(A)-2, Bhubaneswar dated 30.8.2017 for the assessment year 2015-

16.

2.

The revenue has raised the following grounds of appeal:

“1. The order of the Ld. CIT(A) is erroneous both in facts and in law.

2.

On the facts and circumstances of the case the Ld. CIT(A) is not justified in deleting the entire addition of Rs.51,18,920/- made by the AO towards income under the head "Long Term Capital Gain" arising from sale/transfer of immovable property made during the previous year relevant to A.Y. 2015-16.

2.1 The Ld. CIT(A) ought to have appreciated that as per registered sale deed dated 07.03.2015, the assessee was owner of 1 /5th share of the immovable property transferred during the year, and thus

2 ITA No. 480/CT K/ 2017 Asse ssment Year : 20 15- 201 6 she is liable for taxation of income, in respect of her share from the sale consideration received from that property.

2.2 The Ld.ClT(A) ought to have appreciated that as per the decision of the Hon'ble Supreme court in the case of ITO V.Ch.Atchaiah: 218 ITR 239(SC), it was held that "merely because a wrong person is taxed with respect to a particular income, the AO is not precluded from taxing the right person with respect to that income", and thus he ought to have upheld the addition made by the AO towards income from Long Term Capital Gain in the hands of the assessee.”

3.

When the appeal was called for hearing, no one appeared on behalf

of respondent-assessee.

4.

The brief facts of the case are that the Assessing Officer found that

the assessee has sold property at Rs.4,21,00,000/-. Before the Assessing

Officer, it was submitted that alongwith the assessee, her four sons are

the legal heirs to the property, but her three sons being joint owners have

received the entire sale consideration of Rs.4,21,00,000/- and they have

paid tax on it. However, the Assessing Officer did not accept the

contention of the assessee and observed that even though the assessee

did not receive any money, but he was one of the legal heirs and made

the entire consideration of Rs.4,21,00,000/- in the hands of the assessee.

5.

Before the CIT(A), the assessee reiterated the submissions made

before the Assessing Officer, which are reproduced at pages 3-7 of the

order of the CIT(A). After considering the submissions of the assessee,

the CIT(A) deleted the addition by observing as under:

“I have carefully examined the assessment order as well as the written submissions of the appellant. I find that the three co-

3 ITA No. 480/CT K/ 2017 Asse ssment Year : 20 15- 201 6 owners have declared the sale consideration in their name and have filed the return of income and have paid the capital gain tax. The appellant being the mother of four sons and being super senior citizen of 88 years old has relinquished her rights in the property in favour of three co-owners, who have paid the capital gain tax, which has not been disputed by the AO. Further, the department has not lost any capital gain tax as it has been fully paid by the thee co-owners. Moreover, if the five co-owners were to be forcibly subjected to tax, department will stand to losse the revenue when compared to the existing arrangement in which the three co-owners have paid the entire capital gain tax. Considering the above, the addition made by the AO of Rs.51,18,920/- is ordered to be deleted and the grounds of appeal are allowed. “

6.

After considering the submission of ld D.R. we find that the CIT(A)

after considering the entire facts and circumstances of the case has

deleted the addition of Rs.51,18,920/-. No cogent and positive material

has been brought on record by ld D.R. to controvert the findings of the

CIT(A) that the three co-owners have already paid the entire capital gain

tax. Hence, we find no good reason to interfere with the order of the

CIT(A), which is hereby confirmed and grounds of appeal of the revenue

are dismissed.

7.

In the result, appeal of the revenue is dismissed.

Order pronounced on 17 /05/2018.

Sd/- sd/- (Pavan Kumar Gadale) (N.S Saini) JUDICIALMEMBER ACCOUNTANT MEMBER Cuttack; Dated 17 /05/2018 B.K.Parida, SPS

4 ITA No. 480/CT K/ 2017 Asse ssment Year : 20 15- 201 6 Copy of the Order forwarded to : 1. The appellant: Income Tax Officer, Ward - 4(2), Bhubaneswar. 2. The Respondent. Smt. Tilotama Mishra, Plot No.A/124, Saheed nagar, Bhubaneswar 3. The CIT(A)-2, Bhubaneswar 4. Pr.CIT-2, Bhubaneswar 5. DR, ITAT, Cuttack BY ORDER, 6. Guard file. //True Copy//

SR.PRIVATE SECRETARY ITAT, Cuttack

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