Income Tax Appellate Tribunal - Panji
The Ito., Tenali vs Sri Viswanadhapalli Venkateswara ... on 11 October, 2017
ITA No.232/Vizag/2017
Viswanadhapalli Venkateswara Rao, Nizampatnam
आयकर अपील य अ धकरण, वशाखापटणम पीठ, वशाखापटणम
IN THE INCOME TAX APPELLATE TRIBUNAL,
VISAKHAPATNAM BENCH, VISAKHAPATNAM
ी वी. दग
ु ाराव, या यक सद य एवं
ी ड.एस. सु दर "संह, लेखा सद य के सम%
BEFORE SHRI V. DURGA RAO, JUDICIAL MEMBER &
SHRI D.S. SUNDER SINGH, ACCOUNTANT MEMBER
आयकर अपील सं./I.T.A.No.232/Vizag/2017
( नधारण वष / Assessment Year: 2009-10)
ITO, Ward-1, Viswanadhapalli
Tenali Venkateswara Rao,
Nizampatnam
[PAN No.ADAPV9922B]
(अपीलाथ' / Appellant) (()याथ' / Respondent)
अपीलाथ क ओर से / Appellant by : Shri M.K. Sethi, DR
याथ क ओर से / Respondent by : Shri D.L. Narasimha Rao,
AR
सुनवाई क तार ख / Date of hearing : 04.10.2017
घोषणा क तार ख / Date of Pronouncement : 11.10.2017
आदे श / O R D E R
PER D.S. SUNDER SINGH, Accountant Member:
This appeal filed by the revenue is directed against order of the Commissioner of Income Tax (Appeals)-1, {CIT(A)}, Guntur vide ITA No.36/15-16/CIT(A-1)/GNT dated 23.2.2017 for the assessment year 2009-10.
1 ITA No.232/Vizag/2017
Viswanadhapalli Venkateswara Rao, Nizampatnam
2. All the grounds of appeal are related to the assessment made u/s 143(3) r.w.s. 263 of the Income Tax Act, 1961 (hereinafter called as 'the Act') by an order dated 25.3.2015 on total income of ` 54,44,112/-.
3. The assessee filed the return of income declaring total income of ` 1,96,340/- after claiming the deduction u/s 80C of the Act of ` 1.00 lakh besides agricultural income of ` 1,50,000/-. The case was selected for scrutiny and the assessment was completed u/s 143(3) of the Act on total income of ` 51,39,808/- in addition to agricultural income of ` 1,50,000/- by an order dated 27/12/2011. During the original assessment proceedings, the assessing officer found that the assessee sold his land to M/s. VANPIC (P) Ltd. and received the cash consideration of ` 50,75,280/- and claimed that the lands sold were agricultural lands and furnished certificates from VRO. The assessing officer conducted the enquiries through Income Tax Inspector and concluded that the lands in question were capital assets and exigible to capital gains tax. Accordingly, the A.O. brought the sale proceeds of agricultural land under the head long term capital gains and completed the assessment. The matter travelled to the Tribunal and the Tribunal vide its order No.296/Vizag/2012 dated 11.12.2015 decided the issue in favour of the assesse, holding the lands in question were agricultural lands and not capital assets within the meaning of section 2(14) of the 2 ITA No.232/Vizag/2017 Viswanadhapalli Venkateswara Rao, Nizampatnam Act and accordingly dismissed the revenue's appeal. Mean while the Commissioner of Income tax , Guntur has taken up the case for revision u/s 263 and held that the cash received in respect of sale of the lands are taxable under the head income from other sources and accordingly, directed the A.O. to assess the sale consideration of ` 50,75,280/- as income from other sources by order dated 18.3.2014 u/s 263 of the Act. The assessee carried the matter to the ITAT and the ITAT Visakhapatnam in its order No.414/Vizag/2014 dated 23.12.2016 set aside the order of the Ld. CIT and allowed the appeal of the assessee observing that the A.O. has taken one of the plausible view, and there is no case for revision u/s 263 of the Act. For ready reference, we extract relevant paragraph of the order of ITAT cited (supra), which reads as under:
"Having heard both the parties and considered the material on record, we find that the issue of taxation of consideration received towards transfer of lands has been considered by this Tribunal in assessee's own case in ITA No.296/VIZ/2012 dated 11.12.2015 and held that the lands transferred by the assessee are agricultural lands used for agricultural purposes cannot be considered as capital assets within the meaning of section 2(14) of the Act. Therefore, we are of the view that the Commissioner of Income Tax was erred in assuming the jurisdiction to revise the assessment order under the provisions of section 263 of the Act, as the assessment order passed by the Assessing Officer is neither erroneous nor prejudicial to the interest of the Revenue. The Assessing Officer has considered the consideration received towards transfer of lands under the head capital gains, which is, in our opinion, in accordance with law. Since the Assessing Officer has taken one of the plausible view, which was examined by this Tribunal and taken a view that the lands are agricultural lands not liable for tax, there is no prejudice caused to the Revenue. Hence, we set aside the order passed by the Commissioner of 3 ITA No.232/Vizag/2017 Viswanadhapalli Venkateswara Rao, Nizampatnam Income Tax under section 263 of the Act and allow the appeal of the assessee."
4. During the pendency of appeal against the order u/s 263 before the tribunal, the A.O. has given effect to the order u/s 263 of the Act by passing the assessment order u/s 143(3) r.w.s. 263 of the Act by an order dated 25.3.2015 and assessed the amount of ` 50,75,280/- under the head income from other sources. The assessee went on appeal and the Ld. CIT(A), Guntur has cancelled the assessment order passed by the assessing officer giving effect to the order u/s 263. Aggrieved by the order of the Ld. CIT(A), the revenue filed the appeal before us.
5. We have heard both the parties, perused the materials available on record and gone through the orders of the authorities below. In this case, the Ld. CIT has passed an order u/s 263 of the Act on 18.3.2014 and the same was set aside by this Tribunal by an order dated 11.12.2015 and thus there is no valid order in force to give effect. Since this Tribunal has already set aside the order of the CIT and there is no valid order pending for giving consequential effect and the assessment order passed by the A.O. dated 25.3.2015 is infructuous, and accordingly the same is annulled.
4 ITA No.232/Vizag/2017
Viswanadhapalli Venkateswara Rao, Nizampatnam
6. In the result, the appeal filed by the revenue is dismissed. The above order was pronounced in the open court on 11th Oct'17.
Sd/- Sd/-
(वी. दग
ु ाराव) ( ड.एस. सु दर "संह)
(V. DURGA RAO) (D.S. SUNDER SINGH)
या यक सद य/JUDICIAL MEMBER लेखा सद य/ACCOUNTANT MEMBER #वशाखापटणम /Visakhapatnam:
'दनांक /Dated : 11.10.2017 VG/SPS आदे श क त)ल#प अ*े#षत/Copy of the order forwarded to:-
1. अपीलाथ / The Appellant - The ITO, Ward-1, Tenali
2. याथ / The Respondent - Sri Visnadhapalli Venkateswara Rao, S/o Bulli Anjaiah, Opp. Telephone Exchange, Nizampatnam Post & Mandal.
3. आयकर आयु+त / The CIT, Guntur
4. आयकर आय+ ु त (अपील) / The CIT (A)-1, Guntur
5. #वभागीय त न.ध, आय कर अपील य अ.धकरण, #वशाखापटणम / DR, ITAT, Visakhapatnam
6. गाड फ़ाईल / Guard file आदे शानुसार / BY ORDER // True Copy // Sr. Private Secretary ITAT, VISAKHAPATNAM 5