Loading judgment…
No AI summary yet for this case.
Income Tax Appellate Tribunal, PUNE BENCH “SMC”, PUNE
आदेश / ORDER
PER SUSHMA CHOWLA, JM
The appeal filed by the assessee is against the order of Commissioner of Income Tax (Appeal)-2, Nashik dated 15.06.2016 relating to assessment year 2009- 10 passed under section 143(3) r.w.s.147 of the Income Tax Act, 1961( in short ‘the Act’).
2 ITA No.80/PUN/2017 A.Y.2009-10
The appeal was fixed for hearing on 22.03.2018. On that date, a letter was
received by mail. However, none appeared on behalf of the assessee and the matter
was adjourned to 16.05.2018. On the next hearing dates for which notice was sent i.e.
16.05.2018 and 21.08.2018, none was present on behalf of the assessee. Again,
notice was sent through RPAD to the assessee and acknowledgement of service of
notice is available on record. However, none appeared on behalf of the assessee on
the appointed date i.e. 09.10.2018. Hence, the appeal is heard ex-parte the assessee.
The Ld. DR for the Revenue pointed out that the appeal was filed after a delay
of 123 days for which though an affidavit has been filed but there is no explanation of
the delay. He further pointed out that the assessee has claimed deduction u/s.54B of
the Act and referred to Para 6.5 of the appellate order wherein the assessee had
withdrawn the claim of deduction u/s.54B of the Act as mentioned by the Assessing
Officer in Para 10, sub para 3 of the assessment order, vide assessee’s letter dated
29.01.2013. The same was adjudicated by the CIT(A). Further there was findings of
CIT(A) that the land sold by the assessee was not being utilized for agricultural
purpose and hence, the assessee is not eligible for deduction u/s.54B of the Act.
Briefly in the facts of the case, the case of the assessee was picked up for
scrutiny u/s.147 of the Act. The assessee filed revised return of income declaring total
income of Rs.15,50,211/- in response to the notice u/s.148 of the Act which was not
filed within the period of 30 days from the date of service of notice. During the year
under consideration, the assessee had shown income from retail trade, tuition classes,
short term capital gain, long term capital gain and income from other sources. During
the course of assessment proceedings, in the case of Sunil D. Takle, Nashik, it was
seen that Shri Sunil D. Takle, Shri Shrikant D. Takle & Neeta D. Takle, all are
residents of Nashik and had sold the asset at Survey No.501/1, Nashik within 8 kms.
of municipal limits for Rs.75 Lakhs of which Government valuation was at
Rs.1,60,00,000/- as per the sale deed dated 05.07.2008. The assessee had disclosed
3 ITA No.80/PUN/2017 A.Y.2009-10
the long term capital gain at Rs.39,55,110/- on the basis of approved valuer’s report.
The assessee had also claimed exemption u/s.54B(1) of the Act. The Assessing
Officer further noted from sale deed, 7/12 extracts for the aforesaid asset that the
assessee had not utilized the said land for agricultural purpose since last two years.
The remarks on the 7/12 extracts was that the land was “fallow/uncultivated”. Also
from copies of return of income and computation of income filed by assessee for the
A.Y. 2007-08 and 2008-09, it appeared that the assessee has not disclosed any
agricultural income in the said return or computation. Thus, Assessing Officer was of
the view that the assessee had claimed incorrect exemption of Rs.48,98,079/-
u/s.54B(1) of the Act. Other issue raised by assessee is with regard to applicability of
section 50C of the Act and cost of acquisition of the property.
However, limited issue which arose before me is only claim of deduction
u/s.54B of the Act. The assessee has not summarized the grounds of appeal but has
raised the only issue of claim of deduction u/s.54B of the Act. Hence, grounds of
appeal as such are not being reproduced. In the assessment order, Assessing Officer
computed the income from long term capital gain in the hands of assessee at
Rs.31,33,489/-. The assessee had not offered the same for taxation and not paid
taxes thereon. The said amount was added in the hands of assessee. Since the land
was falling within 8 Kms. radius from urban conglomeration, the said land was held as
not an agricultural land. The Assessing Officer did not allow the claim of deduction
u/s.54B of the Act and the said claim was also withdrawn vide letter dated 29.01.2013.
In the present case, investment in agricultural land of Rs.39,29,537/- was made on
03.04.2010.
Aggrieved by the assessment order, assessee filed appeal before the CIT(A)
and made various submissions against the deduction under section 54B of the Act
and the same were dismissed by the CIT(A). The assessee claimed before CIT(A) that
she had shown agricultural income in her return of income. The submissions of the
4 ITA No.80/PUN/2017 A.Y.2009-10
assessee were forwarded to the Assessing Officer for remand report which is
reproduced in Para 6.3 at page 6 to 7 of the appellate order and the same is being
referred but not being reproduced. The assessee, in turn, filed her final submissions
which are also reproduced by the CIT(A). The CIT(A) concluded his findings by
observing as under :
“6.5 I have carefully considered the facts of the case and rival contentions. On perusal of the same it has been noticed that during the course of assessment proceedings the appellant had withdrawn the claim of deduction us. 54B as mentioned by 'the A'O, in para 10, sub para 3 of the assessment order, vide assessee's letter dated 29/01/20l3. In the appellate proceedings the appellant has claimed in the earlier letter filed, that she had not disclosed agricultural income in the returns of income filed for A.Yrs. 2007-08 & 2008-09, as her agricultural income was below Rs.5,000/-. Further on later date, the appellant had claimed that her agricultural income for A.Yrs. 2007-08 and 2008-09 was Rs.15,850/- and Rs.24,700/- respectively. Thereafter during remand proceedings, the A.O. has made enquiry with the Revenue department of Govt. of Maharashtra and obtained 7/12 extracts of the impugned land as per which the land was barren for the years 2005-06 to 2009-10. Thereafter the appellant had again changed her stand and had claimed that the deduction u/s.54B is allowable, even if, the agricultural land was not cultivated in 2 years prior to the date of sale, in view of the decision in the case of CIT Vs. N. Raghu Varma (2013) (Hyd), The appellant had further stated that in the above judgment it is clearly mentioned that if an assessee is unable to cultivate agricultural land due to vagaries of nature and non availability of resources, exemption u/s.54B cannot be denied on its sale. In the case under appeal, the appellant had not brought on record the vagaries of nature due to which she could not cultivate the agricultural land. In view of the facts of the case, it is evident that the appellant had not cultivated agricultural land sold during the year 2005-06 to 2009-10 and hence in view of provisions of section 54B, the appellant is not eligible for deduction u/s.54B of the Act. Ground No.2 is therefore dismissed.”
Now the assessee is in appeal before the Tribunal against the findings of
CIT(A) in respect of claim of deduction under section 54B of the Act.
Before me, the assessee has raised the same submissions as made before the
CIT(A). As per 7/12 extracts, the agricultural land was barren for the years 2005-06 to
2009-10. The assessee claimed that agricultural income was disclosed in her returns
of income for assessment years 2007-08 & 2008-09. The issue which arises is that in
case agricultural income had been shown in assessment years 2007-08 and 2008-09,
can it be that the assessee had not cultivated agricultural land, especially where the
5 ITA No.80/PUN/2017 A.Y.2009-10
agricultural income was shown by assessee had not been disturbed by the Revenue
Authorities. The assessee had shown agricultural income for A.Ys. 2007-08 and 2008-
09 of Rs.15,850/- and Rs. 24,700/- respectively. Hence, the assessee claims that the
agricultural income for the assessment years 2007-08 & 2008-09 had been disclosed
in her return of income. The assessee, during First Appellate proceedings, had filed
confirmation letter of various persons staying/ cultivating land at Wadala stating that
the assessee had cultivated the land in the impugned year and during earlier years
prior to sale. The CIT(A) vide Para 6.2 of his order noted the contention of the
assessee regarding declaration of income for assessment years 2007-08 and 2008-09
and the same has not been disputed. The Assessing Officer in the remand
proceedings noted certain information from assessee on this ground. Merely
because, income was assessed in the hands of other co-owners as long term capital
gain since the land was not cultivated, would not imply that the land of the assessee
was also not cultivated. The Agricultural income had been shown by the assessee and
having not been disturbed by the Assessing Officer, the plea of the assessee in this
regard cannot be disregarded. As the land sold by the assessee was agricultural land
on which agricultural operations were being carried on in the preceding two years, the
assessee is entitled to claim benefit of deduction u/s.54B of the Act. Accordingly, I
direct the Assessing Officer to allow the same. Thus, ground of appeal raised by the
assessee is allowed.
The assessee had moved a petition for condonation of delay of 123 days
wherein she has pleaded because of suddenly severe knee problem was aggravated
to her and also her blood pressure and sugar level was increased. She took the
medical treatment at Nashik. Therefore, she was not able to submit the appeal in time.
In the facts and circumstances, there is merit in the plea of the assessee in this regard
and hence, delay is condoned.
6 ITA No.80/PUN/2017 A.Y.2009-10
In the result, appeal of the assessee is allowed.
Order pronounced on 22nd day of October, 2018.
Sd/- (SUSHMA CHOWLA) �या�यक सद�य/JUDICIAL MEMBER
पुणे / Pune; �दनांक / Dated : 22nd October, 2018. SB आदेश क� ��त�ल�प अ�े�षत / Copy of the Order forwarded to :
अपीलाथ� / The Appellant. 1. ��यथ� / The Respondent. 2. 3. The CIT (Appeals)-2, Nashik. 4. The Pr. CIT-2, Nashik. �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, “एक-सद�य” ब�च, 5. पुणे / DR, ITAT, “SMC” Bench, Pune. गाड� फ़ाइल / Guard File. 6.
// True Copy // आदेशानुसार / BY ORDER,
�नजी स�चव /Private Secretary आयकर अपील�य अ�धकरण, पुणे / ITAT, Pune.