THE ITO, KOCHI vs. M/S.REALITY PROJECTS AND ENTERTAINMENTS P. LTD, PUDUCHERRY

ITA 116/COCH/2020Status: DisposedITAT Cochin23 October 2024AY 2014-15Bench: Shri Satbeer Singh Godara (Judicial Member), Shri Amarjit Singh (Judicial Member)5 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that an advance amount received for land acquisition, without actual transfer or possession, cannot be taxed as business income on a mercantile basis due to lack of reasonable certainty. The compensation was also covered by exemption under the RFCTLARR Act.

What were the facts?

The assessee received an advance of Rs. 15,77,77,550/- in FY 2013-14 for land acquisition. The Assessing Officer treated this advance as business income. The CIT(A) deleted the addition, holding that the transaction was not complete in that year.

What were the issues?

Whether advance received for land acquisition can be taxed as business income when the transaction is not complete, and whether the compensation is exempt under the RFCTLARR Act.

Which sections of the Income-tax Act were involved?

Section 28(i),Section 2(47)(v),Section 46A,Section 53A,Section 24(1)(a)

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Income Tax Appellate Tribunal, COCHIN BENCH, COCHIN

Before: Shri Satbeer Singh Godara & Shri Amarjit Singh

For Respondent: Dr. S. Pandian, CIT-DR
Hearing: 19.08.2024Pronounced: 23.10.2024

Per Bench

This assessee’s appeal for A.Y. 2014-15 arises against the order of the CIT(A)- 1, Kochi in ITA(A)-140/CIT I/2017-18 dated 06.12.2017, in proceedings u/s. 143(3) of the Income Tax Act, 1961 (the Act).

Case called twice. None appears at assessee’s behest. We accordingly proceed exparte against the assessee.

2.

The Revenue raises the following substantive grounds in the instant appeal: - “1. The orders of the Commissioner of Income Tax (Appeals)-1, Kochi are opposed to the facts and circumstances of the case.

2.

That on the facts and circumstances of the case, the Ld.CIT(A) has erred in deleting the addition of Rs. 28,31,26,944/ made by the Assessing Officer as business inc

The order continues below.

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