2015 (7) TMI 405 - AT - Income Tax

Revision u/s 263 - CIT-IV setting aside the assessment for the A.Y 2006-07 and directing the AO to redo the same - whether CIT-IV ought to have noted that the fact of execution of agreement of sale and receipt of advance for sale of land, the subsequent cancellation of the Agreement of Sale and refund of the monies stands fully proved beyond any doubt - tribunal directed the Assessing Officer to carry out the direction given by the CIT and pass consequential order in accordance with law, if it is not already passed - Held that - From the reading of the grounds of appeal, we are of the opinion that para 31 of the order dated 18.05.2012 is not required for disposal of appeal before the Tribunal. In these circumstances, we are of the opinion that the entire para 31 of the Tribunal s order be deleted and the Tribunal order shall end with Para No.30 and Para No.31 shall be read as follows 31. In the result appeal of the assessee is dismissed .

Summary

Issues:
1. Dispute over taxability of an amount received under an Agreement of Sale.
2. Jurisdictional error by the Tribunal in enhancing the income of the assessee.
3. Legality of the directions given by the Commissioner of Income Tax and the Tribunal.

Analysis:

Issue 1:
The assessee filed a petition against the Tribunal's order regarding the taxability of an amount received under an Agreement of Sale. The Commissioner of Income Tax directed a de novo assessment, which the Tribunal upheld, stating that the entire sale consideration had accrued to the assessee. The Tribunal found that the Agreement of Sale was valid and enforceable, with no evidence of cancellation or refund of the advance amount. The Tribunal directed the Assessing Officer to re-examine the issue and pass a consequential order if not already done.

Issue 2:
The petitioner argued that the Tribunal exceeded its jurisdiction by enhancing the income of the assessee, resulting in an error in the order. The Tribunal's findings in paragraph 31 were deemed unnecessary for the disposal of the appeal. The Tribunal acknowledged the error and expunged the findings from paragraph 31, thereby dismissing the appeal of the assessee.

Issue 3:
The grounds of appeal highlighted the errors in the Commissioner's directions and the Tribunal's actions. The Tribunal agreed that paragraph 31 was not essential for the appeal's resolution and modified its order accordingly. The Tribunal allowed the miscellaneous application filed by the assessee, leading to the dismissal of the appeal.

In conclusion, the Tribunal rectified the error in its order by expunging the findings that led to the enhancement of income and dismissed the appeal of the assessee. The legal process ensured that the assessment was conducted in accordance with the law and relevant provisions, addressing the concerns raised by the parties involved.