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TMI Blog2023 (9) TMI 431X X X X Extracts X X X X X X X X Extracts X X X X ..... record in the form of the statement on oath of Talhati that no agricultural operation was carried on. The finding of the Assessing Officer that the land was purchased by the respondent-assessee not with the intention of carrying out any agricultural activities, but with the intention of development of properties remains uncontroverted. There is no cogent material brought on record in support of retracting the statement of the respondent-assessee withdrawing the claim for deduction u/s 54B during the course of assessment proceedings. The fact that the agricultural lands were situated within the 8 kilometres from the Municipal Corporation of Pune remain uncontroverted. In the circumstances, the order of the NFAC cannot be sustained in the eyes of law. Thus, the respondent-assessee had failed to discharge the onus of proving that the lands sold were agricultural lands. Therefore, the order of the NFAC is reversed and the addition made by the AO is restored. Thus, the grounds of appeal filed by the Revenue stand allowed. - Shri Inturi Rama Rao, Accountant Member And Shri S. S. Viswanethra Ravi, Judicial Member For the Revenue : Shri Ajay Kumar Kesari For the Assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2013 declaring total income of Rs. 4,78,70,740/-. Against the said return of income, the assessment was completed by the Dy. Commissioner of Income Tax, Circle-5, Pune ( the Assessing Officer ) vide order dated 30.03.2016 passed u/s 143(3) of the Income Tax Act, 1961 ( the Act ) at a total income of Rs. 29,50,61,981/-. While doing so, the Assessing Officer disallowed the claim for deduction u/s 54B of Rs. 24,71,17,100/- with which, we are concerned. The factual matrix of the case is as under : During the previous year relevant to the assessment year under consideration, the respondent-assessee had sold the land situated at Gat No.84, 91, 195 of Kirkatwadi, Pune admeasuring 2H 14R for a consideration of Rs. 24,00,00,000/- to developer. In the return of income, the assessee claimed deduction u/s 54B of Rs. 18,34,37,980/- on reinvestment of the sale proceeds of the agricultural land and Rs. 6,36,79,120/- in capital gain deposits scheme. During the course of assessment proceedings, the Assessing Officer conducted enquiries and visited the land. Based on the enquiry conducted, physical inspection, he concluded that the land sold was not an agricultural land since the land in question ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4B of the Act. 5. Being aggrieved, an appeal was filed before the NFAC contending that the 7/12 extracts clearly indicated that the crops grown on the land and the respondent-assessee had shown agricultural income of Rs. 69,344/- and the Assessing Officer ought not to have placed reliance on the submission given by the Talathi without affording opportunity of cross-examination etc. The NFAC vide impugned order considered the additional evidence after calling for remand report, allowed the claim of the respondent-assessee u/s 54B of the Act. 6. Being aggrieved, the Revenue is in appeal before us in the present appeal. 7. The ld. CIT-DR submits that the NFAC without examining in detail evidence such as Google Satellite Images, 7/12 revenue records, statement on oath of Talathi and field verification report of Income Tax Inspector etc., simply accepted the contention of the respondent-assessee. He further submits that the statement given by the respondent-assessee constitutes important piece of evidence unless otherwise retracted by substantiation. 8. On the other hand, the ld. AR submits that the evidence on record clearly established that the respondent-assessee had carr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment u/s. 131 recorded of Shri Vivek Broome who the appellant had claimed to have cultivated the land had initially admitted of such cultivation but could not give any details and evidences in regard to carrying out of any agricultural activities on the said land and further had denied of such cultivation done by him. (vi) the satellite images taken from the Google Earth taken by the AO during the course of assessment proceedings which had also been part of the assessment order indicated that no such crops were grown or agricultural activities done on the said land as there was no green shade. (vii) the Inspector attached to AO had reported on local enquiry on the land and surrounding places adjacent to the land that the land contained murrum, pebbles etc. and was not cultivable and no agricultural activities had been carried out in the said land in past years and nearest to the land the development of a project by the builder and developer DS Kulkarni Developers Ltd. who had also owing the said land after sale was being done in the name of DSK Vishwa. (viii) the land admeasuring 2.14 Hectors was purchased by the appellant for a lesser amount but had been sold for a higher ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ustrial Patna High Court CWJC No.1550 of 2016 dt.16-11-2017 Disputes Act insisted on the need of giving reasons in support of conclusions in the award. The Court held that the very requirement of giving reason is to prevent unfairness or arbitrariness in reaching conclusions. The second principle is based on the jurisprudential doctrine that justice should not only be done, it should also appear to be done as well. The Court said that a just but unreasoned conclusion does not appear to be just to those who read the same. Reasoned and just conclusion on the other hand will also have the appearance of justice. The third ground is that such awards are subject to Article 136 jurisdiction of the Court and in absence of reasons, it would be difficult for the court to ascertain whether the decision is right or wrong. It is well settled by now that reason is the life of law. It is an indispensable component of a decision making process. A nonspeaking and non-reasoned order smacks arbitrary exercise of judicial or quasi-judicial or even administrative power. 15. The Hon'ble Apex Court in Kranti Associates (P.) Ltd. v. Masood Ahmed Khan [2010] 9 SCC 496 while dealing with the requi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted that transparency is the sine qua non of restraint on abuse of judicial powers. Transparency in decision making not only makes the judges and decision makers less prone to errors but also makes them subject to broader scrutiny. (See David Shapiro in Defence of Judicial Candor (1987) 100 Harward Law Review 731-737). (n) Since the requirement to record reasons emanates from the broad doctrine of fairness in decision making, the said requirement is now virtually a component of human rights and was considered part of Strasbourg Jurisprudence. See (1994) 19EHRR 553, at 562 para 29 and Anya vs. University of Oxford, 2001 EWCA Civ 405, wherein the Court referred to Article 6 of European Convention of Human Rights which requires, adequate and intelligent reasons must be given for judicial decisions . (o) In all common law jurisdictions judgments play a vital role in setting up precedents for the future. Therefore, for development of law, requirement of giving reasons for the decision is of the essence and is virtually a part of Due Process .' 11. It would be apposite to refer to para 11.13 of the order of the NFAC, which is operative part of the impugned order, it w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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