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Income Tax Appellate Tribunal, DELHI “B” BENCH: NEW DELHI
Before: SHRI KUL BHARAT & SHRI O.P.KANT
ORDER PER KUL BHARAT, JM :
This appeal filed by the assessee for the assessment year 2006-07 is directed against the order of Ld. CIT(A)-XII, New Delhi dated 11.03.2013.
The assessee has raised following grounds of appeal:-
1. "The first 148 notice was issued on 24/09/2008 and the assessment has been made on 31/12/2010 i.e. more then one year from initiation of reassessment proceedings on the information received. Hence the order under appeal is time - barred.
2. The notice dated 24/09/2008 u/s148 for same reasons was issued by ITO, Ward 2(1), Ajmer and no order was passed by him by the time the ITO. Trust Ward III. Delhi issued notice u/s 148 on 09/12/2009 for the same facts/reasons. There can not exist two 148 notices simultaneously on two different tax payers for a single transaction. The satisfaction of Delhi ITO is a borrowed one & not his own satisfaction.
The notice u/s 148 dated 09/12/2009 for asst. year 2006-07 is invalid as it has tried to bring in the property sold in 1995 and possession was given/ payment was received under a written agreement. Registration of sale deed is not pre- condition in Income Tax for a transaction to be treated as sale. Payment & possession is sufficient under an agreement.
4. Sec 50C was inserted w.e.f. 01/04/2003 into law and for transaction of 1995, it has not application. It is not retrospective.
Sec 50C is not applicable on exemption provisions u/s 11 and 12 of I.T. Act. 1961 because the deeming provision are not applicable as prescribed in sec 50C. Net consideration means actual amount received as per sale deed and not the deemed amount.
6. Additional evidences filed before CIT (A) were not objected to by the ITO in his remand report dated 20/07/2012 and were also accepted by CIT (A) on page 11 of his order but the CIT (A) failed to consider properly the facts and evidences filed before him to support the case.
7. The application of sec 50C and reassessment made in this case be kindly deleted/ cancelled.”
2. The facts giving rise to the present appeal are that the assessment u/s 143 r.w.s. 148 of the Income Tax Act, 1961 (“the Act”) was framed vide order dated 31.12.2010. While framing the assessment, the Assessing Officer observed that the property known as “Husband Memorial School, Ajmer was disposed off on 29.11.2005 by the assessee “Church of North India Trust Association” for consideration of Rs.7,06,980/-. However, the value was adopted as assessed by the Sub-Registrar, Ajmer at Rs.77,80,888/-. Therefore, the Assessing Officer treated the full value of consideration of Rs.77,80,888/- as capital gain in the hands of the assessee with reference to provisions contained u/s 50C(1) of the Act.
3. Aggrieved against this, the assessee preferred appeal before Ld.CIT(A) wherein the assessee had challenged the addition and also the validity of notice u/s 148 of the Act as issued by the Assessing Officer. However, the appeal filed by the assessee was dismissed by Ld. CIT(A).
Now, the assessee is in appeal before this Tribunal. Ground Nos.1 to 3 raised by the assessee in this appeal read as under:-
"The first 148 notice was issued on 24/09/2008 and the assessment has been made on 31/12/2010 i.e. more then one year from initiation of reassessment proceedings on the information received. Hence the order under appeal is time - barred.
The notice dated 24/09/2008 u/s148 for same reasons was issued by ITO, Ward 2(1), Ajmer and no order was passed by him by the time the ITO. Trust Ward III. Delhi issued notice u/s 148 on 09/12/2009 for the same facts/reasons. There can not exist two 148 notices simultaneously on two different tax payers for a single transaction. The satisfaction of Delhi ITO is a borrowed one & not his own satisfaction. 3. The notice u/s 148 dated 09/12/2009 for asst. year 2006-07 is invalid as it has tried to bring in the property sold in 1995 and possession was given/ payment was received under a written agreement. Registration of sale deed is not pre- condition in Income Tax for a transaction to be treated as sale. Payment & possession is sufficient under an agreement.”
5. Ld. Counsel for the assessee vehemently argued that Ld.CIT(A) failed to adjudicate the specific grounds taken by the assessee. He submitted that there were two notices issued u/s 148 of the Act wherein first notice was issued on 24.09.2008 and the assessment was completed on 31.12.2010. It was clearly a time barred assessment. Further, he submitted that for the same reasons, another notice u/s 148 of the Act was issued on 09.12.2009. He contended that the earlier notice dated 24.09.2008 remained in operation since that was not withdrawn by the Assessing Officer at Ajmer. Further, he contended that the property in question was infact transferred in the year 1995 in terms of section 2(47)(v) of the Act as the entire payment was received and the possession was handed over to the vendee. He submitted that for this transaction, even the assessment could not have been re-opened by issuing notice dated 09.12.2009. Ld. Counsel for the assessee has taken us through the impugned order to buttress the contention that all these three grounds which were categorically taken before Ld.CIT(A), have not been adjudicated. Further, Ld. Counsel for the assessee submitted that the addition has been made by invoking the provision of section 50C(1) of the Act and the transaction related to year 1995. Therefore, the Assessing Officer grossly erred in making the addition by invoking the provisions which was not in the Statute Book at the time of transfer of property. He therefore, prayed that the impugned assessment deserves be quashed.
Per contra, Ld. Sr. DR submitted that so far the assessee is concerned, only one notice u/s 148 of the Act was issued on 09.12.2009.
The Notice dated 24.09.2008 was issued to a different entity. He submitted that notice might have been issued for the same transaction but the notice to both ex-facie are different assessees. The notice was subsequently withdrawn against the another assessee.
We have heard the rival contentions and pursued the material available on record and gone through the orders of the authorities below.
We find that the assessee had taken specific grounds against the re-opening of the assessment by making multi fold submissions; firstly that there cannot be two notices u/s 148 of the Act for the same transaction; secondly, the notice dated 09.12.2009 would be barred by time as the property in question was sold in the year 1995. Further, it is contended that the addition is made by invoking of section 50C(1) of the Act which was inserted in the year 2003 much after transaction was executed. We have perused the entire order of the Ld.CIT(A). We do not find any adjudication on this ground as the Ld.CIT(A) has dismissed the appeal of the assessee by observing as under:-
“A perusal of the reproduced provision would clearly reveal that the same are applicable to all the asses sees and even a trust or society which has been granted registration u/s 12AA of the Income Tax Act. In view of the same it is undisputed that as per information received from ITO, Ward-Il, Ajmer, property known as "Husband Memorial School" was valued at Rs.77,80,888/- for Stamp purposes by Sub-Registrar, Ajmer. Since the sale deed was registered on 29.11.2005 the transaction has taken place during A.Y. 2006-07 and therefore provisions of section 50C inserted w.e.f. 1.4.2003 are very much applicable to the case of the assessee.
As per the scheme of action 11, 12 & 13 even income/ proceeds in the nature of gains accruing on transfer of capital assets had to be applied by the said trust/society and only thereafter exemption is available. In the present case the counsel of the assessee has not brought on record any material to show any application by the assessee of the consideration received on sale of the impugned immovable property. Even the balance sheet and income and expenditure account for A. Y. 2006-07 has not been filed.
The contention of the assessee that the transfer of the impugned property took place during A. Y. 1995-96 as per the definition of Transfer of Property Act u/s 2(47) of the Income Tax Act is not tenable. No document has been brought on record to prove that the possession of the impugned property was handed over by the assessee to the buyer and hence it cannot be said that there was a part performance of a contract of the nature referred to in section 53A of the Transfer of Property Act, 1982. In view of the above discussion the order of the A.O. is confirmed.”
During the course of hearing, Ld. Sr. DR fairly conceded that these grounds have not been adjudicated by way of a speaking order. We, therefore, set aside the impugned order and restore the grounds of appeal raised by the assessee in this appeal before Ld.CIT(A) to decide the appeal afresh by way of speaking order on each ground raised in Form No.35 by the assessee. We are conscious of the fact that the case being very old related to the Assessment Year 2006-07. However, in the absence of a specific adjudication by the First Appellate Authority, we deem it proper to restore the grounds to the file of Ld.CIT(A) for adjudicating the grounds raised in Form No.35. Ld.CIT(A) is hereby directed to dispose of grounds and the appeal of the assessee within three months from the date of receipt of this order. Thus, grounds raised by the assessee in this appeal are allowed for statistical purposes.
In the result, the appeal of the assessee is allowed for statistical purposes.
Above decision was pronounced on conclusion of Virtual Hearing in the presence of both the parties on 15th July, 2021.