MR SANDEEP DNYANOBA SAKHARE,PUNE vs. PRINCIPAL COMMISSIONER OF INCOME-TAX -2, PUNE

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ITA 636/PUN/2021Status: DisposedITAT Pune06 December 2022AY 2017-185 pages

In favour of the Revenue: the assessee's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal found that the Assessing Officer had not properly verified the conditions for Section 54B exemption and the nature of the bank account. Therefore, the CIT's order setting aside the assessment for fresh verification was justified.

What were the facts?

The assessee claimed exemption under Section 54B for the transfer of agricultural land and deposited Rs. 24 lacs in a Capital Gains Scheme account. The CIT observed that the assessee did not carry out agricultural activity and the deposit was made in a regular savings account, deeming the assessment order erroneous and prejudicial to revenue.

What were the issues?

Whether the CIT was justified in exercising revisionary powers under Section 263 due to the AO's failure to verify the conditions for Section 54B exemption and the nature of the capital gains deposit.

Which sections of the Income-tax Act were involved?

Section 54B,Section 143(3),Section 263

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, PUNE BENCH “B”, PUNE

Before: SHRI R.S. SYAL & SHRI S.S. VISWANETHRA RAVI

For Respondent: Shri P.R. Mane

PER R.S.SYAL, VP : This appeal by the assessee is directed against the order dated 23.09.2021 passed by ld. Pr.CIT-2, Pune u/s 263 of the Income-tax Act, 1961 (hereinafter referred to as „the Act‟) in relation to assessment year 2017-18. 2. Briefly stated, the facts of the case are that the assessee filed return declaring total income of Rs.1,28,41,685, which was accepted as such by the Assessing Officer (AO) by means of an order u/s 143(3) of the Act dated 12.12.2019. During the course of revisionary proceedings, the ld. CIT observed that the assessee wrongly claimed the exemption u/s 54B inasmuch as no agricultural activity was carried out by the assessee or his parents or his HUF in the two years immediately preceding the date on which the said land was transferred and hence the AO erred in granting exemption u/s 54B to that extent. He further observed that the assessee claimed benefit in respect of deposit of Rs.24 lacs in Capital gain scheme account. He noted that the amount of deposit was in regular Savings bank account and not in stipulated Capital gain scheme account. In view of these facts, he held that the assessment order was erroneous and prejudicial to the interest of revenue. In the ultimate analysis, he set aside the assessment order and directed the AO to frame the assessment afresh as per law after ascertaining all the necessary facts and making enquiries for the purpose. Aggrieved thereby, the assessee has approached the Tribunal.

3.

We have heard the ld. DR and perused the record. The written submissions filed by the assessee have been taken into consideration. It can be seen that the first issue which was taken up by the ld. CIT is about the claim of exemption u/s 54B on transfer of agricultural land. There is no reference whatsoever in the assessment order about verifying the conditions precedent for claiming exemption in ascertaining whether the land in question was subjected to agricultural activity carried on by the assessee or his parents or his HUF in the two years immediately preceding the date on which the said land was transferred. The written submissions talk of the AO raising a query in this regard and the assessee also replying to the same. In the replies submitted before the AO, as have been reproduced in the written submissions, the emphasis is on the holding of the land and not carrying out the agricultural operations. Similar is the position regarding the benefit claimed by the assessee towards deposit of Rs.24 lacs in the Capital gain scheme account, for which the ld. CIT has recorded a finding that the same was deposited in regular Savings bank account and there was no evidence to the contrary. Examination of the necessary bank accounts from the point of view of exemption is essential on behalf of the AO. In the written submissions, the assessee has submitted that it was a designated account only. However, no copy of such bank account has been placed in the paper book to substantiate the claim. Since the ld. CIT has simply set aside the assessment order and directed the AO to frame the assessment afresh after making proper verification qua the above two issues, the door is still open to the assessee to furnish the necessary evidence in support of the points raised by the ld. CIT. As such, we do not find any reason for the assessee to be aggrieved by the impugned order.

4.

In the result, the appeal is dismissed Order pronounced in the Open Court on 06th December, 2022.

1.

Sd/- Sd/- (S.S.VISWANETHRA RAVI) (R.S.SYAL) JUDICIAL MEMBER VICE PRESIDENT पुणे Pune; नदिधांक Dated : 06th December, 2022 GCVSR आदेश की प्रतितिति अग्रेतिि/Copy of the Order is forwarded to: 1. अपीलधर्थी / The Appellant; प्रत्यर्थी / The Respondent; 2. 3. नवभधगीय प्रनिनिनर्, आयकर अपीलीय अनर्करण, पुणे “B” / DR „B‟, ITAT, Pune गधर्ा फधईल / Guard file 4.

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