2022 (11) TMI 1255 - AT - Income Tax

Capital Gain on sale of land - liability to be taxed in the hands of the appellant - appellant requests your honour to kindly direct the learned assessing officer to allow the credit of income tax paid by the company on the capital gain on sale of land against the income tax payable by the appellant on the capital gain arises from the sale of said land - HELD THAT - We hardly see any reason to accept the assessee s instant latter argument in light of hon ble apex court s landmark decision in CIT vs., Ch Atchaiah 1995 (12) TMI 1 - SUPREME COURT that the correct amount of income has to be assessed in right person s hands only. Faced with this situation, we hardly see any reason to entertain the assessee s instant remand request seeking credit of the alleged taxes payment by the company in this appellant s hands. Rejected accordingly.

Summary

Issues:
Appeal against addition of capital gain on sale of land, confirmation of addition by CIT(A), remand request for ex-parte order, condonation of delay in filing appeal.

Analysis:
1. The appeal pertains to the addition of Rs. 47,89,850 as capital gain on the sale of land for AY 2011-12. The appellant contested the CIT(A)'s decision to confirm the addition without considering that the land was owned by a company in which the appellant is a director, arguing that the profit should not be taxable in the appellant's hands due to double taxation. The appellant also requested credit for income tax paid by the company on the capital gain if taxed in the appellant's hands.

2. Both the CIT(A) and the Assessing Officer rejected the appellant's contention that the capital gains should be assessed in the company's name. The appellant's representative sought a remand to the CIT(A) due to the ex-parte order, but the Tribunal noted that the appellant failed to provide evidence that the company declared the capital assets in its balance sheet. Citing the principle that income should be assessed in the right person's hands, the Tribunal dismissed the remand request and the request for tax credit.

3. The Tribunal condoned the delay of 408 days in filing the appeal, considering the appellant's reasons and the impact of the Covid-19 pandemic on the filing date. The decision to condone the delay was based on the principle of substantial justice, following a Supreme Court precedent. Ultimately, the Tribunal dismissed the appellant's appeal against the addition of capital gain on the sale of land, upholding the CIT(A)'s decision.

4. The judgment was pronounced on 23rd November 2022, with the appeal being dismissed in accordance with the Tribunal's findings and conclusions.