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2021 (7) TMI 620 - AT - Income TaxAddition of income on substantive basis - Long Term Capital Gain on sale on ancestral land - co- owrenshiop - protective assessment in the name of all co-owners in their individual capacity have been made - CIT(A) has deleted the addition - whether land sold was ancestral and belongs to Mool Chand, HUF?- HELD THAT - We derive that the Revenue has at least accepted income on substantive basis in the hands of those five individuals. In such circumstances, the same income cannot be assessed on substantive basis in the hands of the assessee. Further, on perusal of copy of land revenue record, which is a copy dated 28/03/2006, wherein name of five individuals is recorded as owner of the land. In view of this document also those five individuals are owner of their respective shares, and no evidence of any ownership in the hands of Moolchand HUF has been filed by the Revenue before us. We are of opinion that the finding of the Ld. CIT(A) on the issue in dispute is well reasoned and we do not find any error in the same. Accordingly, we dismiss the ground raised by the Revenue.
Issues:
1. Deletion of addition of Long Term Capital Gain by CIT(A) in the case of Moolchand HUF. 2. Assessment of capital gain in the hands of five individuals and Moolchand HUF. 3. Justification of seeking assessment of income in Moolchand HUF on substantive basis. 4. Lack of evidence of ownership in Moolchand HUF. Analysis: 1. The appeal pertained to the deletion of the addition of Long Term Capital Gain by the CIT(A) in the case of Moolchand HUF. The Assessing Officer had made the addition on the basis that the land sold was ancestral and belonged to Moolchand HUF. The CIT(A) deleted the addition, stating that no double addition can be made for the same transaction. The Revenue contended that the land was owned by Moolchand HUF and that the capital gain should be assessed in its hands. 2. The Assessing Officer reopened the case of Moolchand HUF and assessed the capital gain on transfer of the land in its hands on a substantive basis. Additionally, the capital gain was assessed in the hands of five individuals on a protective basis. The CIT(A) treated the income on transfer of land in the hands of five individuals on a substantive basis and deleted the addition in the hands of Moolchand HUF. The Revenue argued that since no appeal was filed against the assessment of the five individuals, the same income should not be assessed in the hands of Moolchand HUF. 3. The Revenue failed to provide evidence of ownership in Moolchand HUF during the proceedings. The Tribunal noted that the Revenue had accepted the income on a substantive basis in the hands of the five individuals. The Tribunal also found that the land revenue record showed the names of the five individuals as owners of the land, indicating their ownership of the respective shares. As a result, the Tribunal upheld the CIT(A)'s decision and dismissed the Revenue's appeal. 4. The Tribunal highlighted that the Revenue had not challenged the substantive nature of the assessment in the case of the five individuals. The Tribunal further emphasized that the lack of evidence of ownership in Moolchand HUF's hands and the documentary proof showing the ownership of the five individuals supported the decision to dismiss the Revenue's appeal. Consequently, the Tribunal ruled in favor of the Respondents, upholding the CIT(A)'s decision to delete the addition of Long Term Capital Gain in the case of Moolchand HUF.
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