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TMI Blog2013 (2) TMI 811X X X X Extracts X X X X X X X X Extracts X X X X ..... the rejection of the appellant claim for deduction under section 54F of I.T.Act 1961. 4. That the Ld. CIT (Appeals) has erred in law and on facts in upholding the assessment made under section 144 of IT. Act 1961. 5. That the Ld.C.I.T.(Appeals) has erred in law and on facts in upholding the assessment of enhanced compensation in the hands of a different and deceased person of Sli. Randhir Singh . through his legal heir, in violation of the relevant provision of law, 6. That the appellant craves for permission to amend or add any other ground of appeal before it is heard and disposed of. 3. In ITA No. 945 946/Chd/2009, the assessees have raised similar grounds of appeal. Therefore, grounds of appeal, as raised in ITA 945/Chd/2009, are reproduced hereunder : 1. That the Ld. CAT (Appeals) has erred in law and on facts in upholding the initiation of assessment proceedings under section 148 read with section 147 of I.T.Act 1961 for the assessment year 2002-03. 2. The Ld, CIT (Appeals) has erred in law and on facts in holding that the enhanced compensation is taxable in the assessment year 2002-03. 3. That the Ld. CIT (Appeals) has erred in law and on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Harwirderjit Kaur was not having her PAN and it was applied on 17-082009. The PAN Card was delivered to her on account of 10-09-2009 and she forgot to inform the same and she was not aware of the implications of delay in filing the appeal. 4. That I was also busy in completing the audit and preparing audit reports and filing of Income Tax returns of the assessee in Sep.2009, 30lh Sept. being the last date and I was under pressure of work load and therefore could not follow up the appellants to file the appeal immediately. 5. On receiving the PAN Number, the appeal were prepared immediately and appeal fees was deposited on the same day and these were filed through speed post on the same day. However there was delay of 3-4 days in filing the appeals before your Honor. 6. That there was absolutely no intention to delay the filing of appeal because it was against interests of the appellants. 7. This being a bonafide mistake on behalf of Smt. Harwinderjit Kaur which may kindly be condoned. 5(iii) In view of the contents of the affidavit as also to meet the ends of justice, we are of the considered opinion that delay in filing appeals, deserve to be condoned and, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... disallowed deduction u/s 54F of the Act, amounting to ₹ 4,41,000/-, as is evident from perusal of para 7 of the assessment order. The assessee filed appeal against the impugned assessment order. The findings of the CIT(Appeals), upholding the findings of the AO, are reproduced hereunder : 6. 1 have carefully considered the contention of the Ld. Counsel for the appellant being an agriculturist by profession and being completely unaware of the provisions of I.T. Laws did not obtain any vouchers for the purchase of building material etc. Though this contention of the Ld. Counsel might have some merit it was for him to see as to in the absence of such bills and vouchers etc. what best evidence could be produced in support of the contention as above. Admitted position in this case is that neither before the A.O. nor during appeal proceedings any evidence in the form of bills and vouchers for the purchase of material or labour in respect of the alleged construction has been produced. No other evidence has further been filed in this regard by the appellant at any stage. The ld. Counsel is mainly relying upon the report of the Registered Valuer, However, as brought out in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppeal are, therefore, dismissed. 8(i) Ld. 'DR' placed reliance on the decision of the jurisdictional High Court in Pawan Kumar Garg V CIT 311 ITR 397(P H) wherein it has been held that onus to prove construction on residential house is on the assessee and in case of failure to discharge such onus, the assessee is not entitled for exemption u/s 54F of the Act. Relevant part of the decision is reproduced hereunder : CAPITAL GAINS -EXEMPTION-INVESTMENT OF GAINS IN RESIDENTIAL HOUSE- BURDEN ON ASSESSES TO PROVE SUCH INVESTMENT-FINDING THAT NO RESIDENTIAL HOUSE HAD BEEN CONSTRUCTED WITHIN THE STIPULATED TIME -ASSESSEE NOT ENTITLED TO EXEMPTION UNDER SECTION -F-INCOME-TAX ACT, 1961, s. 54F. The assessee had shown long term capital gains of ₹ 4,64,400 on the sale/purhase of 2,900 shares. He also claimed exemption under section 54F of the Income-tax Act, 1961. The claim of the assessee that he had built two small rooms which constituted an independent dwelling unit and therefore he was entitled to clarification of Circular No. 667, dated October 18, 1993 (see [1993] 204 ITR (St.) 103) issued by the Central Board of Direct Taxes was rejected because it was held ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g the assessment proceedings and appellate proceedings before CIT(Appeals) and before the Bench, to justify his claim u/s 54F of the Act. The issue, in question, is squarely covered by the decision of jurisdictional High Court and Kerala High Court referred to above, against the assessee and in favour of the revenue. 8(iv) A bare perusal of the relevant facts and findings of the AO and the CIT(Appeals), including the Paper Book filed by the assessee reveals that the assessee appellant has failed to file any evidence, to support his claim of exemption u/s 54F of the Act. The assessee merely filed a valuation report, from the Regd.Valuer, which is a dumb document, as to the year of renovation of the said residential house. The Regd. Valuer admitted before AO that no bills or vouchers were made available to him and he made the report, without confirming the year, in which the construction was carried out. The Valuer also admitted that such details and facts should have been incorporated, in the Valuation Report. However, the same had not been done. The Regd.valuer has been examined by the AO and contents of his deposition were reproduced, in the asstt.order, dated 27.11.2006, passe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in any proceedings before various authorities, including appellate proceedings before the Bench. Rival submissions made by the ld. 'AR' and ld. 'DR' had been carefully considered. Having regard to the relevant records, submissions and case-laws relied upon by the parties, we do not find any infirmity in the findings of the CIT(Appeals), hence, the same are upheld. Accordingly, we uphold the findings of the CIT(Appeals) and dismiss the Ground No. 3 of the appellant. 9. In GroundNo.4, the assessee contended that CIT(Appeals) erred in law and on facts in upholding the assessment made u/s 144 of the Act. 9(i) We have perused the rival submissions, facts of the case and the findings of ld. CIT(Appeals), and find no merit in the ground of appeal raised by the assessee, in view of the detailed findings recorded by ld. CIT(Appeals) in para 7 8 of the impugned appellate order. However, for the sake of ready reference, the same is reproduced hereunder : 7. Ground of appeal No.6 is that the Ld. A.O. has erred on facts and law in making the assessment u/s 144/148 of the Act. 7.1 As far as action u/s 147/148 of the Act is concerned, the facts have been discuss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Accordingly, the same is dismissed. 14. In Ground No. 3, the appellant contended that the CIT(Appeals) has erred in law and on facts in upholding the rejection of claim for deduction u/s 54F of the Act. The submissions, filed by both ld. 'AR' and ld. 'DR' in appeal No. 945/Chd/2009 are applicable in this appeal also, as stated by them. 15. We have carefully perused and considered the rival submissions, facts of the case, relevant records and the decisions relied upon by the contending parties. The brief facts of the case are that the assessee appellant received additional compensation, on account of acquisition of land coowned by others, from Defence Department, out of which assessee got his share, on 12.04.2001, amounting to ₹ 7,70,492/-. The AO, issued notice u/s 148 of the Act and the same was served on 02.03.2006. The assessee did not comply with the notice. On 20.09.2006, a notice u/s 142 asking the assessee to explain as to why an amount of ₹ 7,70,492/- may not be assessed in his hands, being the amount of additional compensation received by him. The assessee filed return of income on 25.09.2006, in the course of assessment proceedings. In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me of inspection of the property? Ans: Yes, I was confused about the year of construction,! but I relied on the assessee as is stated in my valuation report. Ques: If there was any confusion in your mind regarding the year of construction, then why did you not incorporated this fact in your report ? Ans: I admit that this fact should have been incorporated in the report. The Authorised Representative of the assessee denied any cross examination of the Registered Valuer. From the, statement of the Registered Valuer it is clear that the assessee has not constructed any property during the relevant previous year. The report of the inspector also confirms that the assessee has not constructed any property. Therefore, the claim of the assessee regarding construction/addition in residential building is bogus and erroneous and hence he is not entitled for deduction u/s 54 F. 7. During the course of assessment proceedings the assessee submitted extract from his Saving Bank A/C No. 30588 with Oriental Bank of Commerce, Ikolaha which shows withdrawals amounting to ₹ 1.94,430/- during the period 10.2.01 to 24.9.01. The assessee had claimed that these withdrawa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n which the construction was carried out. He also admitted that this fact should have incorporated in the report and that however it has not been done. In of the above statement of the Regd. Valuer coupled with the report of Inspector who physically inspected the site, the A.O. cannot be said to be unjustified in concluding that neither new construction nor alteration/addition was made by the appellant during the relevant period. Though it is contended by the Ld. Counsel that if the A.O. was not satisfied with the report of the Regd. Valuer, the matter should have been referred to the Departmental Valuers, I do not agree with the Ld. Counsel in this regard. The above procedure is required to be taken into account when action is taken under the relevant provisions of Section 55A of the Act etc. However this was not a case where the provisions of Section 55A were involved. The valuation report of the Regd. Valuer was rather filed by the appellant in support of its claim that the construction was carried out during the eligible period and that this had nothing to do with the valuation of the construction otherwise. Rather in view of the categorical admission of the Regd. Valuer that h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t is admitted fact that no bills and vouchers or any evidence was produced by the appellant to justify his claim. Ld. 'DR' placed reliance on the order of Hon'ble jurisdictional High Court, in the case of Pawan Kumar Garg V CIT (supra), wherein it has been clearly held that onus to prove construction on residential house is on the assessee and in case of failure to discharge such onus, the assessee is not entitled for exemption u/s 54F of the Act. The relevant part of the decision is reproduced hereunder : CAPITAL GAINS -EXEMPTION-INVESTMENT OF GAINS IN RESIDENTIAL HOUSE- BURDEN ON ASSESSES TO PROVE SUCH INVESTMENT-FINDING THAT NO RESIDENTIAL HOUSE HAD BEEN CONSTRUCTED WITHIN THE STIPULATED TIME -ASSESSEE NOT ENTITLED TO EXEMPTION UNDER SECTION -F-INCOME-TAX ACT, 1961, s. 54F. The assessee had shown long term capital gains of ₹ 4,64,400 on the sale/purhase of 2,900 shares. He also claimed exemption under section 54F of the Income-tax Act, 1961. The claim of the assessee that he had built two small rooms which constituted an independent dwelling unit and therefore he was entitled to clarification of Circular No. 667, dated October 18, 1993 (see [1993] 20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nfirmity and, hence, the same are upheld. Accordingly, Ground No. 3 is dismissed. 17. In Ground No. 4, appellant contended that CIT(Appeals) erred in law in upholding the assessment made u/s 144 of the Act. However, a perusal of the relevant records, comprising of assessment order and order passed by the CIT(Appeals), in this case, reveals that assessment has been framed u/s 143(3) of the Act and not u/s 144 of the Act, as contended in the ground of appeal. Similarly, no such ground has been raised before CIT(Appeals). However, a perusal of the record, it is evident that AO has framed assessment, after giving due opportunity to the assessee and the assessment order is based on the cogent and credible evidence, brought on record. Further, the appellant has himself stated in Ground No.6 (original grounds) that the assessment has been framed u/s 143(3) of the Act. In view of this, ground of appeal bearing No.4 is dismissed. 18. Ground No. 5 is general in nature and need no separate adjudication. Accordingly, the same is dismissed. 19. In the result, appeal of the assessee, bearing No. ITA 946/Chd/2009 is dismissed. ITA No. 944/Chd/2009 A.Y. 2002-03 Shri Jagwinder Singh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erty was made by the appellant during the relevant period. In the assessment order the A.O. has also discussed that even the mother of the appellant and their old servant Shri Gopal working with the appellant for more than 10 years also informed that no new house was constructed. This would further go to strengthen the findings of the A.O. in this regard. Further though it is contended by the Ld. Counsel that if the A.O. was not satisfied with the report of the Registered Valuer the matter should have been referred to the Departmental Valuer, I do not agree with the Ld. Counsel in this regard. The above procedure is required to be taken into account when action is taken under the relevant provisions of Section 55 A of the Act etc. However this was not a case where the provisions of Section 55A were involved. The Valuation Report of the Registered Valuer was rather filed by the appellant in support of its claim that the construction was carried out during the eligible period and that this had nothing to do with the valuation of the construction etc. Rather in view of the categorical admission of the Regd. Valuer that he gave the report without verifying the actual period of construc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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