9911796707
TMI Blog2024 (1) TMI 292X X X X Extracts X X X X X X X X Extracts X X X X ..... isclosed by the assessee in the return of income filed u/s 139 of the Act, are not a valid reason to reopen the assessment. I also note that in the return of income, the assessee has disclosed the correct and full material facts about the disputed land, therefore on the same set of facts, the reopening of assessment is not allowed. We also note that assessee filed return of income for the assessment year under consideration and it is within the power of the Income Department to issue the scrutiny notice u/s 143(2) of the Act and conduct the scrutiny assessment on the assessee instead of reopening of the assessee`s case u/s 147/148. Therefore, reopening of assessment is not valid as the Income Tax Department has power to conduct the scrutiny assessment by issuing notice u/s 143(2) of the Act. After filing the return of income u/s 139 of the Act, if the Department does not conduct the scrutiny assessment, by issuing notice u/s 143(2) of the Act then in that situation, on same set of facts, which are narrated in the return of income filed by the assessee, the Department cannot reopen the assessment u/s 147/148 of the Act. The assesse has disclosed in the return of income filed b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re land. 3. Ld. CIT(A), NFAC has erred in law and on fact to agree with the views of the AO that deduction u/s 54EC at Rs. 29,60,000/- w.r.t. investment in NHAI Bonds was not allowable as it was allotted on 31.05.2012 i.e. beyond 6 months period from the date of transfer. 4. Ld. CIT(A), NFAC and the AO have erred in law and on fact to interpret and held Release Deed as Purchase Deed of property and accordingly assessed 25% LTCG as STCG on sale of agriculture land situated at Moje Gam-Kanad, Tal-Olpad, Dist. Surat. 5. Additional Ground:: Ld. CIT(A), NFAC has erred in law and on fact to upheld AO s reopening of assessment u/s 147 and issue of notice u/s 148 of the act. 3. In this appeal, the assessee has raised five grounds of appeals. Ground Nos.1 to 4 relate to merits of the addition and ground no.5 is legal ground, wherein the assessee has challenged the correctness of the reopening of assessment under section 147/148 of the Act. 4. The appeal filed by the assessee for assessment year 2012-13 is barred by limitation by thirty-one days. The assessee has moved a petition for condonation of delay. The contents of the petition for condonation of delay are re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt to an offence under the law. 5. The ld Counsel for the assessee also submitted that due to mistake of the tax consultant of the assessee, the delay of thirty-one days has occurred in filing the appeal before this Tribunal, therefore this minor delay may be condoned. 6. On the other hand, Learned Senior Departmental Representative (ld. Sr. DR) for the Revenue opposed the prayer for condonation of delay and stated that assessee has failed to prove sufficient reasons for the delay, hence delay may not be condoned. 7. I have heard both the parties on this preliminary issue and noted that assessee is a senior citizen and retired pensioner, does not have computer system, internet facility in his village. The person who filed the income tax return of the assessee, used to look after the income tax matters of the assessee, did not take care, hence delay has arisen. I note that just because the advocate or the tax consultant has committed the mistake, the assessee should not be penalized. I have gone through the condonation petition. I find that there is good and sufficient cause for filing the appeal belatedly. Accordingly, I condone the delay of thirty-one days and admit th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... D/8722/2011. The Stamp Duty Valuation Officer has determined the fair market value of the property at Rs. 2,80,66,610/-. As such there is a difference of Rs. 1,33,46,360/- (Rs. 2,80,66,610 - Rs. 1,47,20,250) between the sale value as per sale deed and the fair market value hence, the provisions of section 50C of the Income Tax Act attracted in the hands of sellers. Therefore, after recording reasons for reopening of the case and obtaining necessary approval from the Pr. Commissioner of Income- Tax-1, Surat, the case was reopened u/s 147 of the Act. The notice u/s 148 of the Act was issued on 19.03.2018 and served upon the assessee. In response to the same, the assessee e-filed return of income for A.Y.2012-13 on 09.05.2018, declaring total income at Rs. 2,34,370/-. During the reopened assessment proceedings, the reasons for reopening were supplied to the assessee. Subsequently, notice u/s 143(2) and notice u/s. 142(1) of the Act were issued and duly served upon the assessee. 13. During the course of assessment proceedings, it was noticed by the Assessing Officer that the assessee has sold the above said jointly held land and received Rs. 36,80,063/- as his 25% share and worked o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed can be executed with seller by first party (purchaser) or any other party which purchaser will decide. So, claim by us are verified and acceptable as per our opinion and the same satakhat details mentioned in the sale deed page no 67 para 2. As per section 50C of Income Tax Act, 1961, jantri value of the property will be taken as on the date of agreement of sale if any consideration will be received by the assessee before agreement of sale. In this case, we have received cash Rs. 20,250/- and cheque Rs. 7,00,000/- before agreement of sale and the same detail was mentioned in satakhat page no 4 point no 2. So, the jantri value will be taken as on date of agreement of sale i.e. 19/01/2010 for F.Y. 2009-10. So there is no question of violation of provision of section 50C will arise. Copy of the bank statement, released document, agreement of sale and sale deed are already submitted to you as on 15.10.2018. 2. As you mentioned in show cause notice In Para 2 of page 67 of the registered document no. 4537 dated 27.06.2011, it is clearly mentioned that the peaceful possession of the seller's part has been handed over to the purchasers on that day i.e. 27.06 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs on that day i.e. 27.06.2011. Therefore, 12.5% of total land i.e. 50% of land of assessee's share ownership was on 27.06.2011 and therefore half of the land sold of his share is a Short Term Capital Asset. In this connection, assessee contended that as per Section 49(1) of the Act, if any asset is acquired by way of inheritance/gift then the cost of acquisition will be cost of previous owner and date of acquisition will be taken as date of acquisition to previous owner. The contention raised by the assessee was not found acceptable as per law by the Assessing Officer. The assessee has not acquired half of his share in land by inheritance or gift as claimed by him but has purchased vide registered document no.4537 dated 27.06.2011 for the consideration paid of Rs. 5,00,000/- of his share. Further, in Para 2 of page 67 of the registered document No.4537 dated 27.06.2011, it is clearly mentioned that the peaceful possession of the seller's part has been handed over to the purchasers on that day i.e. 27.06.2011. Therefore, 12.5% of total land i.e. 50% of land of assessee's share came under his ownership on 27.06.2011. The said land was sold on 19.11.2011. Therefore half o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... led any appeal against the valuation of the property made by the Stamp Duty Authorities. As per provisions of Section 50C of the I.T. Act, 1961 assessee was required to show sales consideration received of Rs. 70,16,653/- in computation of capital gain. However, assessee has shown consideration received of Rs. 36,80,063/- in computation of capital gain. This is clear violation of provisions of section 50C of the I.T. Act. Therefore, differential amount of Rs. 33,36,590/- (Rs. 70,16,653 -Rs. 36,80,063) is added to the total of the assessee under the head Capital Gains (Rs. 16,68,295/- as Long Term Capital gain and Rs. 16,68,295/- as Short Term Capital Gain for the year under consideration u/s 50C of the I.T. Act, 1961. 18. Aggrieved by the order of the Assessing Officer, the assessee carried the matter in appeal before the NFAC/ld. CIT(A) who has confirmed the action of the Assessing Officer. The assessee did not attend the proceedings before the NFAC/ld. CIT(A), therefore NFAC/ld. CIT(A) after considering the findings of the assessment order, adjudicated the issue on merit and dismissed the appeal of the assessee. 19. Aggrieved by the order of ld. CIT(A), the assessee is in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fficer should have issued a scrutiny notice u/s 143(2) of the Act and perform the full scrutiny instead of reopening the case of the assessee, on same set of facts, which are there in the return of income filed by assessee u/s 139 of the Act, therefore section 147/148 is not a substitute for section 143(2) and 143(3) of scrutiny assessment, wherein the Department has right to conduct the scrutiny u/s 143(3) of the Act, on the basis of the return of income filed by the assessee u/s 139 of the Act. Therefore, Ld. Counsel contended that provision of section 143(2)/143(3) of the Act, cannot be substituted with the provision of section 147/148 of the Act, hence reasons recorded by the Assessing Officer on same set of facts, which were disclosed by the assessee in the return of income, are not a valid reason to reopen the assessment. 22. The ld Counsel also pointed out that it is not a case that assessee has concealed any details and particulars of the transaction in his return of income filed u/s 139 of the Act. The Ld. Counsel also contended that in the reasons so recorded, it is mentioned that assessee has not disclosed the correct material facts of its case for the year under cons ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d DR stated that the reasons recorded by the Assessing Officer are valid and these are sustainable in the eye of law. 24. I have gone through the facts of the case, the reasons recorded for reopening u/s 147 of the Act, the submission and the various decisions of the Courts including those relied upon by the assessee. The assessee has challenged the reopening on basically on the following grounds that provision of section 143(2)/143(3) of the Act, cannot be substituted with the provision of section 147/148 of the Act, hence reasons recorded by the Assessing Officer on same set of facts, which were disclosed by the assessee in the return of income, are not a valid reason to reopen the assessment. Let us examine, the reasons recorded by the Assessing Officer, which are reproduced below: 6. Basis of forming reason to believe and details of escapement of income. The assessee has not declared the sale consideration as per the provisions of section 50C of the I.T. Act. As discussed above, as per the provisions of section 50C of the I.T. Act, the share of the assessee as sale consideration of the property is Rs. 70,16,652/- as against the assessee has declared sale consi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... correct and full material facts about the disputed land, therefore on the same set of facts, the reopening of assessment is not allowed. 26. I also note that assessee filed return of income for the assessment year under consideration and it is within the power of the Income Department to issue the scrutiny notice u/s 143(2) of the Act and conduct the scrutiny assessment on the assessee instead of reopening of the assessee`s case u/s 147/148 of the Act. Therefore, reopening of assessment is not valid as the Income Tax Department has power to conduct the scrutiny assessment by issuing notice u/s 143(2) of the Act. After filing the return of income u/s 139 of the Act, if the Department does not conduct the scrutiny assessment, by issuing notice u/s 143(2) of the Act then in that situation, on same set of facts, which are narrated in the return of income filed by the assessee, the Department cannot reopen the assessment u/s 147/148 of the Act. The assesse has disclosed in the return of income filed by him, all material facts relating to disputed land, therefore the Department should have conducted the scrutiny assessment by issuing notice u/s 143(2) of the Act rather than reopening ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce to notice under Section 148 is also quashed restoring the original assessment order. 5.1 The assessee has raised various grounds challenging the addition made in the order of reassessment. Since we have already quashed the order of reassessment, these grounds do not survive for adjudication. 27. On the same set of facts, the reliance can be placed on the judgment of the Hon ble Madras High Court in the case of CIT vs C. Palaniappan (2006) 284 ITR 257 (Mad) while considering the reopening of assessment u/s 147 r.w.s. 148 of the Act qua the issuance of notice u/s 143(2) the Act has held as under: We heard learned counsel for the parties. Learned counsel appearing for the Revenue submitted that the Appellate Tribunal failed to appreciate the fact that the assessment was completed only under section 143(1) of the Act and hence the reopening of assessment under section 147 of the Act to consider the correct quantum of interest allowable as deduction in computing the income from house property was correct as the assessee had nor furnished relevant facts and evidence along with the return. Learned counsel further submitted that the Appellate Tribunal erred in its concl ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
