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TMI Blog2023 (1) TMI 1015X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, 2013 had ever been raised by the assessee nor allowed by the A.O, therefore, there could be no justification on the part of the Pr. CIT to have held the order passed by the A.O u/s.143(3) dated 15.11.2022 as erroneous in so far as it was prejudicial to the interest of the revenue u/s.263 of the Act, for the reason that he had wrongly allowed it s claim for exemption u/s.10(37) r.w. RECTLARR Act, 2013. Interestingly, it is a case where the order u/s.143(3) dated 15.11.2019 had been held by the Pr. CIT as erroneous on the ground that he had wrongly allowed a claim of exemption which, in fact, had never been so allowed by the A.O. We, thus, in terms of our aforesaid observations finding no justification on the part of the Pr. CIT for having revised the order passed by the A.O u/s.143(3) dated 15.11.2019, set-aside his order and restore that passed by the A.O u/s.143(3) - Appeal of the assessee is allowed. - ITA No. 56/RPR/2022 - - - Dated:- 23-1-2023 - Shri Ravish Sood, Judicial Member And Shri G D Padmahshali, Accountant Member For the Assessee : Shri Praveen Goyal, CA For the Revenue : Shri Debashish Lahiri, CIT-DR ORDER PER RAVISH SOOD, JM: Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot be revised u/s.263 of the Act. In reply, it was the claim of the assessee that it had not claimed income from sale/transfer of the lands in question as exempt u/s.96 of the RECTLARR Act, 2013. Further, clarifying the issue, it was submitted by the assessee that the net income/surplus on acquisition of its lands by NHAI was accounted for by it as its revenue from operations. Elaborating on his contention, it was submitted by the assessee that the net profit of Rs.19,78,143/- that was earned from the aforesaid transaction of acquisition of its lands by NHAI was disclosed by it as its business income under the provisions of the Act. To sum up, it was the claim of the assessee that neither it had earned any capital gain nor while filing its return of income claimed any exemption u/s.10(37) r.w. RECTLARR Act, 2013. At the same time, it was submitted by the assessee that though it had in the course of the assessment proceedings raised a claim for exemption u/s.10(37) of the Act r.w. RECTLARR Act, 2013 of the amount that was received on acquisition of its lands by NHAI, but the same was not accepted by the A.O. Also, it was stated by the assessee that it had thereafter assailed the ord ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 022 was based on misconceived and incorrect facts. Elaborating on his aforesaid contention, it was averred by the Ld. AR that the assessee company in its return of income had neither offered any amount received on acquisition of its lands by NHAI for tax under the head capital gain nor claimed any exemption u/s.10(37) r.w.s 96 of RECTLARR Act, 2013. On the contrary, it was submitted by the Ld. AR that the surplus (net) of Rs.80,23,548/- received on acquisition of its lands by NHAI was disclosed by the assessee company, a real estate developer, as its revenue from operations in its financial statements, Page 29 of APB. It was further submitted by the Ld. AR that the net profit of Rs.19,78,143/- that was earned by the assessee company from the aforesaid transaction was duly disclosed as its income from business and offered for tax in its return of income for the year under consideration i.e. A.Y.2017-18, Page 20-24 of APB. On the basis of the aforesaid facts, it was the claim of the Ld. AR that now when the assessee had not raised any claim for exemption of the amount that was received as compensation on acquisition of its lands by NHAI under section 10(37) r.w. RECTLARR Act, 201 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s in its profit loss account for the year under consideration, Page 29 of APB. As the A.O observed that the assessee had wrongly claimed cost of acquisition of the lands at Rs.18.08 lac as against the actual cost of Rs.13,62,047/-, therefore, the assessee in the course of the assessment proceedings on being confronted admitted the said mistake, and, accordingly, the A.O after meeting out the aforesaid discrepancy reworked out assessee s revenue from operations at Rs.84,69,499/-, and vide his order passed u/s.143(3) dated 15.11.2019 assessed the income at Rs.14,98,431/-. 10. On a perusal of the financial statements of the assessee a/w. its return of income, it transpires that it had accounted for the surplus (net) arising/accruing on compulsory acquisition of its lands by NHAI as its revenue from operations. We are unable to fathom as to on what basis the Pr. CIT had observed that the assessee company had disclosed the income from acquisition of its lands by NHAI under the head capital gain , and claimed the same as exempt u/s.10(37) r.w. RECTLARR Act, 2013. In fact, the very basis so adopted by the Pr. CIT for revising the order passed by the A.O u/s.143(3) dated 15.11.2019, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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