Income Tax Appellate Tribunal - Chandigarh
Dcit, Yamunanagar vs Rani Devi, Jagadhari on 30 May, 2025
आयकर अपील य अ धकरण, च डीगढ़ यायपीठ, च डीगढ़
IN THE INCOME TAX APPELLATE TRIBUNAL
CHANDIGARH BENCH, 'B', CHANDIGARH
BEFORE SHRI L ALIET KUMAR, J UDICIAL MEMBER
& S HRI KR INW ANT SAHAY, ACCOUNT ANT ME MBER
M.A No. 214/Chd/2018
(Arising out of ITA No. 230/CHD/2017)
Assessment Year: 2008-09
The DCIT, Shri Rakesh Tyagi,
Yamunanagar Gobindpur,
Yamunanagar
PAN ACXPT3538K
M.A No. 216/Chd/2018
(Arising out of ITA No. 232/CHD/2017)
Assessment Year: 2008-09
The DCIT, Smt. Ritu Rani,
Yamunanagar New Grain Market,
Jagadhri,
Yamuna Nagar.
PAN : AIUPR9055L
M.A No. 217/Chd/2018
(Arising out of ITA No. 233/CHD/2017)
Assessment Year: 2008-09
The DCIT, Smt. Rani Devi,
Yamunanagar H.No. 1739, Sector 17,
HUDA, Jagadhri,
PAN : AGEPD6583H
न धा रती क ओर से / As sess e e b y : S h. Aj a y J a i n, C A
रा ज व क ओ र से / R ev en u e by : Dr . R an j it Ka ur , Add l . C IT Sr . DR
&
M.A No. 215/Chd/2018
(Arising out of ITA No. 231/CHD/2017)
Assessment Year: 2008-09
The DCIT, Shri Ram Niwas Garg,
Yamunanagar House No. 90, Shashtri Colony,
Yamuna Nagar.
PAN : AAGPN0573M
(Appellant) (Respondent)
M.A.Nos.-214 to 217-Chd-2018
ITA Nos. 230 to 232-Chd-2017
Rakesh Tyagi and Others, Yamunanagar
2
( Physical Hearin g )
नधा रती क ओर से / As sess ee by : S h. Par i kshit Agg ar wal, CA and
M s. Shruti Khen dal wal , Ad vo cate
राज व क ओर से / Reve n ue by : Dr . R anj i t Kaur, A ddl . CIT Sr.DR
सु न वाई क तार ख/Date of Hearing : 23.05.2025
उदघोषणा क तार ख/Date of Pronouncement : 30.05.2025
आदे श/Order
Per Lal iet Kumar, JM :
These are Miscellaneous Applications (M. As) filed by the Revenue seeking rectification of the order dated 03.04.2018 passed by the Tribunal.
2. The learned Departmental Representative (Ld. DR) submitted that there is an apparent m istake in the impugned order, which warrants rectification under section 254(2) of the Income Tax Act. In support of the plea, the Ld. DR invited our attention specifically to paragraphs 6 to 10 of the Tribunal's order, which, accor ding to the Revenue, contain conclusions or omissions leading to a m istake apparent from the record.
3. The learned Departmental Representative (Ld. DR) submitted that there is a mistake apparent from the r ecord in the impugned order which warrants r ectif ication under section 254(2) of the Income Tax Act, 1961. He invited our attention to paragraphs 7 and 8 of the Tribunal's order, wherein the Tr ibunal had admitted an additional ground M.A.Nos.-214 to 217-Chd-2018 ITA Nos. 230 to 232-Chd-2017 Rakesh Tyagi and Others, Yamunanagar 3 raised by the assessee challenging the validity of the reassessment proceedings under section 147. It was submitted that the issue of jurisdiction under section 147 was not raised before the learned CI T(A), albeit it was decided against the assessee by the Assessing Officer. The said ground was introduced before the Tribunal as an additional ground, and the Tribunal, af ter admitting it, remanded the matter to the file of the Assessing Officer for passing a fresh assessment order. According to the Revenue, this action by the Tribunal amounts to a mistake apparent from the record. The finding of the Tribunal given in para 6-10 are as under:
"6. The assessee, it was submitted, claimed it to be an AOP. The Tax Authorities did not accept it and considered the transfer of land in the name of individual members. The ld. AR submitted that in the proceedings before AO and the CIT(A), the assessee on account of lack of proper advice, did not raise the jurisdictional issue which on facts ought to have been raised. The following additional ground, accordingly was raised :
"That on law, facts, circumstances and legal position of the case, the initiation, continuation and conclusion of the impugned assessment u/s 147 r.w.s 148 of the Income Tax Act is illegal and deserves to be quashed."
7. In support of admission of the same, it was submitted that the jurisdictional issue going to the root of the matter may be first decided. The ground, it was submitted could not be raised on account of the ignorance of the assessee and lack of proper advise. In the facts of the case, it was submitted that since the assumption of jurisdiction itself is questionable in the circumstances, it was his prayer that the said ground may be admitted in terms of the decision of the Apex Court in the case of NTPC 229 ITR 383 (1998) (S.C).
8. The ld. CIT-DR considering the jurisdictional issue submitted that though it is a legal ground and thus he would have no objection to the admission of the same, however, since the relevant discussions are M.A.Nos.-214 to 217-Chd-2018 ITA Nos. 230 to 232-Chd-2017 Rakesh Tyagi and Others, Yamunanagar 4 not in the orders of the Tax Authorities, it was his prayer that in the circumstances, it would be appropriate to remand the issue. The ld. AR agreeing with the submissions stated that it was his prayer also that the issue may be remanded to the AO.
9. We have heard the submissions and perused the material available on record. It is seen that the assessment order has been passed considering the merits of the arguments raised by the assessee. The CIT(A) in appeal, it is seen proceeded to partly agree with the assessee, "Therefore, in view of above, 1 am of the view that there is an extinguishment of right in the capital asset by the appellant vide collaboration agreement dated 29.08.2007 as per sub clause
(ii) to section 2(47) which is further supported by clarification of word 'transfer' by Explanation (2) below section 2(47). So, there is 'transfer' of capital assets as per the inclusive definition u/s 2(47) during the year under consideration." Since the assumption of jurisdiction itself is questioned, by the assessee which aspect has not been considered by the tax authorities. Accordingly, in these circumstances without getting into the aspect of correctness of the order under challenge which is stated to have not been challenged by the Revenue and thus according to the assessee, the issue which remains open for consideration is only the applicability of Section 2(47)(ii), we deem it appropriate to not get into this debate and set aside the impugned order back to the file of the AO with the direction to pass a speaking order in accordance with law after giving the assessee a reasonable opportunity of being heard.
10. In the result, the appeal of the assessee is allowed for statistical purposes."
4. The ld. DR, had submitted that the issue of 147, which was used an additional ground by the Assessee was adm itted by the Tr ibunal in paragraphs 7 and 8 and thereafter the matter was remanded back to the file of the Assessing Officer for passing the fresh assessment order.
M.A.Nos.-214 to 217-Chd-2018 ITA Nos. 230 to 232-Chd-2017 Rakesh Tyagi and Others, Yamunanagar 5 5 The elaborate subm issions were filed by the Revenue in this regar d in pages 1 to 13, which are as under:
M.A.Nos.-214 to 217-Chd-2018 ITA Nos. 230 to 232-Chd-2017 Rakesh Tyagi and Others, Yamunanagar 6 M.A.Nos.-214 to 217-Chd-2018 ITA Nos. 230 to 232-Chd-2017 Rakesh Tyagi and Others, Yamunanagar 7 M.A.Nos.-214 to 217-Chd-2018 ITA Nos. 230 to 232-Chd-2017 Rakesh Tyagi and Others, Yamunanagar 8 M.A.Nos.-214 to 217-Chd-2018 ITA Nos. 230 to 232-Chd-2017 Rakesh Tyagi and Others, Yamunanagar 9 M.A.Nos.-214 to 217-Chd-2018 ITA Nos. 230 to 232-Chd-2017 Rakesh Tyagi and Others, Yamunanagar 10 M.A.Nos.-214 to 217-Chd-2018 ITA Nos. 230 to 232-Chd-2017 Rakesh Tyagi and Others, Yamunanagar 11 M.A.Nos.-214 to 217-Chd-2018 ITA Nos. 230 to 232-Chd-2017 Rakesh Tyagi and Others, Yamunanagar 12 M.A.Nos.-214 to 217-Chd-2018 ITA Nos. 230 to 232-Chd-2017 Rakesh Tyagi and Others, Yamunanagar 13 M.A.Nos.-214 to 217-Chd-2018 ITA Nos. 230 to 232-Chd-2017 Rakesh Tyagi and Others, Yamunanagar 14 M.A.Nos.-214 to 217-Chd-2018 ITA Nos. 230 to 232-Chd-2017 Rakesh Tyagi and Others, Yamunanagar 15 M.A.Nos.-214 to 217-Chd-2018 ITA Nos. 230 to 232-Chd-2017 Rakesh Tyagi and Others, Yamunanagar 16 M.A.Nos.-214 to 217-Chd-2018 ITA Nos. 230 to 232-Chd-2017 Rakesh Tyagi and Others, Yamunanagar 17 M.A.Nos.-214 to 217-Chd-2018 ITA Nos. 230 to 232-Chd-2017 Rakesh Tyagi and Others, Yamunanagar 18
6. Per contra, the learned Authorised Repr esentative (Ld. AR) for the assessee strongly opposed the Miscellaneous Application on various grounds. It was submitted that the issue under section 147 pertains to jurisdiction and is a legal issue, which can be raised at any stage of the appellate proceedings, even if not raised before the CIT(A). Accor dingly, the Tribunal was just ified in admitting the additional ground and remanding the matter to the file of the Assessing Officer. The Ld. AR submitted that the order of the Tribunal does not suffer from any mistake apparent from the record.
6.1 It was further submitted by the Ld. AR that the Revenue, in its application, has levelled certain unsubstantiated allegations against the counsel for the assessee, and our attention was drawn to specific paragraphs of the applicat ion in this r egard. He subm itted that such allegations are unwarranted and wholly inappropriate. He contended t hat the Tribunal, after due consideration, consciously exercised its jurisdiction in remanding the matter, and no error has been pointed out in the said decision which can be rectified within the limited scope of section 254(2). Entertaining such applications, it was submitted, would amount to a review of the Tribunal's order, which is impermissible in law. In support of his arguments, he relied upon the decision of the Hon'ble Supreme Court in the case of Reliance Telecom Ltd. v. Union of India [(2021) 132 taxmann.com 64 (SC)].
M.A.Nos.-214 to 217-Chd-2018 ITA Nos. 230 to 232-Chd-2017 Rakesh Tyagi and Others, Yamunanagar 19 6.2 The Ld. AR has also filed detailed written submissions reiterating the above arguments, which have been taken on recor d and considered. The s ubmissions filed by the assessee were as follows:
"1. 'A' Individ ual al ongwith oth er la nd co-owners entered int o an unregis tered JDA w ith a company, duri ng the ye ar in ques tion. This agreement was s ubsequently e ndorsed in favour of a new entity and even t hat e ndorse d one a lso did not mature. The sel ler group had re ceive d Rs. 5 crores duri ng the year as performance security d eposit. The devel oper had agreed to pay Rs. 32 crores to the land-ow ners for their part of com mitments. But this amount was never received by l and-owners from this de vel oper. All t hese are undisputed facts.
2. The cas e for the year i n ques tion was re-opened u/s 148 on the iss ue of al le ged c apital gains, from execution of JDA, havi ng not bee n decl ared . Before t he L d. AO, the assess ee f iled objectio ns on some t angents of inv alidit y of re- ope ning of t his case and also argued t hat t he ca pital gain ca n not be charge d t o tax in t he s ubje ct y ear only on account of j ust si gning of the JDA which too is onl y an unregistered agreement. However, the Ld. AO did n ot agree. He r ejecte d the contention s of the assess ee on the validity of re-ope ning u/s 1 48 as al so held that th e entire cons ider ati on o f Rs. 3 2 crores is char gea ble t o tax as capit al gains in t he ye ar of sig ni ng of t he unregistered J DA . For bringi ng the capital gains t o tax, the Ld. AO he ld that exec ution of JDA amounts to trans fer as is co ntempl ated u/s 2(4 7)(v) & (vi) . He als o made a reference to s. 2(47)(ii ).
3. In appeal be fore t he Worthy CIT(A ), the as sessee argue d that capit al gai ns ca n not be brought to tax in the subject ye ar and t he transacti on of sign ing of an unregiste red JDA, in t he facts of this cas e , does not fal l in e ither of t he clauses of transfer u/s 2(4 7). In the or der, the W orthy C IT(A) he ld that t he acti on o f L d. AO in holding the ex ecution of JDA to f all u/s 2(47)(v)/(vi ) is incorrect. B ut he he ld that the trans action in question fall s u/s 2(4 7)(ii ) i.e . extinguishment of ri ghts . On t his s ubstituted reasoni ng, t he W orthy CIT(A) upheld t he addition an d dismiss ed the appe al of the ass essee.
M.A.Nos.-214 to 217-Chd-2018 ITA Nos. 230 to 232-Chd-2017 Rakesh Tyagi and Others, Yamunanagar 20
4. Then the A' fil ed appeal bef ore the Ho n'ble ITAT. But it may ple ase be note d that the reven ue chos e not to f il e appeal agai nst the order of Worthy CIT(A) . In the origi nal appe al memo that he fi led be fore th e Hon'ble Be nch, t he asses see did no t ra ise the groun d on validity of re-openi ng in t his cas e. However, during the pe nd ency of appeal, he fi led appli cati on prayin g for admitt ance of a dditional ground u/r 11 agitating therein that re- opening u/ s 14 8 in this case was bad in law.
5. Before th e Honble ITAT, the assess ee also fi led Bri ef sy nopsis contai ning its co nte ntio ns as to why i ts grounds incl uding t he gro und on vali dit y of re-ope ning des erves to be all owed.
6. The Hon' ble Bench, in their order dtd. 0 3.04.2018, remande d all the iss ues ba ck t o t he file of Ld. AO to de cided afresh . Thi s i ncluded t he contentions through addition al gro und on vali dity of re-ope ni ng u/s 148. As regards the merits of the matter, the assessee contend ed before the Hon'ble Ben ch that while remanding the matter, the di rections should be such t hat the scop e s hou ld be limited t o examin ing the transaction u/s 2(4 7)(ii ) and not u/ s 2(47)(v )/(vi) since the Worthy CIT(A) h ad delete d the as pect of s. 2 (47)( v)/(vi ) and the reven ue had not come up i n appeal on that as pect before the Hon'bl e IT AT. However, i n the order, the Hon'ble Bench di d not agree to this argument of the assess ee and rem ande d the matter in ent irety . T he Hon' ble Bench specificall y noted i n P ara 9 that "Accordingly, in these circ umstances w ithout gett in g i nto the aspe ct of correctness of the order under chal lenge which is s tate d to have not been challenge d b y the rev enue and this according to the assessee, t he is sue which remains open for cons ideration is only t he appl icability of sect ion 2(4 7)(ii), we deem i t appropri ate to not get into this debate a nd set as ide the i mpugned order back t o t he file of the AO wit h direct ions t o pass a speak ing order in accordance with law after giving the as sess ee a reasonable opportun ity of being heard."
7. The revenue is a ggrieved from above or der of Hon 'ble ITAT . They have bro adly rai sed fol lowing contentions. B ut those conte nti ons are absol utely incorrect b ased on our arguments which are also dealt h ereunder :
M.A.Nos.-214 to 217-Chd-2018 ITA Nos. 230 to 232-Chd-2017 Rakesh Tyagi and Others, Yamunanagar 21 7.1. The cha lle nge to val idity of re-openi ng, r ais ed through addi ti onal gro und by the as sessee, and agre ed by t he CIT -DR, as hav ing not bee n taken earlier an d the n remande d by the Hon'ble Benc h to the A O, is illeg al si nce thi s had alrea dy been raised through obj ect ions bef ore the AO a nd the A O had de alt with these objectio ns s e paratel y :
• In t heir MA as also i n the written arg umen ts on that MA fi le d be fore the Hon'bl e Ben ch , the rev enu e has agitate d that the iss ue of v ali dity of re-opening of as ses sment u/s 148 was rais ed by the assessee be fore the AO al so and the AO havi ng a lready de alt t his issue , there is no reas on to remand this matter to the fi le of AO. Our arguments o n this part of MA is that on appreciatio n of our arguments made before the Hon'ble Ben ch at the time of he aring, it was the wisdom of the Hon' ble Bench ex ercis ing their vast powers u/ s 2 54(1) to still remand the iss ue of v al idity of re-
openin g u/ s 148 to the fi le of AO to deci de this iss ue afresh . Further, it can be s ee n from our synopsis fil e d before t he Hon' ble Be nch at the time of he arin g that it cont ains arguments on number of ot her tangents on val idit y of re-openi ng of ass essment whi ch w ere not rais e d earlier be fore the L d. AO during asses sment procee dings. Now t o say t hat once havi ng r aised s ome ta nge nts of reopening before t he AO, t he assess ee is es toppe d from rais ing some n ew ta ngents bef ore the Hon' ble ITAT is abs olute ly incorre ct. F urther, it is a c as e where the Hon'b le Bench has not allowed the appe al of the ass ess ee on that new tange nt an d quality of re-openi ng, but has only remande d t he matter back to the fi le of AO to all ow the AO to deal with eve n those tangents. In our opini on, the not fol lowi ng of dire ctio ns of Hon' ble Bench a nd asking the Bench to change t he directi ons on AO's own views is amounti ng to contempt on the part of AO and the AO has decided to s it in judgment ov er the order of Ho n'ble IT AT. He is s aying i n the MA that he will not deal w ith t he matter remande d back by the Hon'ble Bench si nce in his own wisdom he has already dealt wit h this matt er.
It may please be not ed that the is sue of val idity of re- openin g u/s 148 was n ot rais ed bef ore the Worthy CIT (A).
M.A.Nos.-214 to 217-Chd-2018 ITA Nos. 230 to 232-Chd-2017 Rakesh Tyagi and Others, Yamunanagar 22 The same can be see n from the groun ds of appeal rais e d before the CIT( A). Th e n i t was n ot raise d before the Hon'ble Bench in the ori gi nal app eal memo. In t his situat ion, t he appell ant h ad no choice but t o rais e this iss ue vi a additi onal ground which the Hon' ble Benc h appreciate d and the Ld. C IT-DR agreed. Now th e L d. AO is cont endin g in the M A that he hav ing dealt wit h this is s ue at the time of ass ess me nt, the a ss essee coul d no t have raise d this issue be fore the Hon'ble Ben ch. T his i s direct ly co ntrary t o number of jud gments where it has been h eld that legal issue on j urisd ict ion of t he As sess ing authority can be rais ed in hi gher appellate f orum an d at any stage of liti gation. It is a lso s ettled l aw that there can not be a waiver so f ar as juris dicti on as pe ct i s concer ned. Some of those decisions are :
CIT vs Pruthvi Brokers & Sharehol ders 349 ITR 3 36 (Bom) o Invent ors Ind l. Cor porat ion Lt d. Vs CIT 19 4 ITR 548 (Bom) Ramilaben Rat il al Shah vs CIT 282 ITR 176 (Guj) Based on above ar guments , the content ion of the revenue that thi s iss ue havin g alrea dy bee n dealt by the AO in the 1s t round of assessme nt, he w ill not deal wit h t his 2 nd time on dire ctions of Honble Bench i s tota l incorrect an d deserves to be dis miss ed.
7.2. That t he AR of t he as sessee misle d t he Bench and based on that CIT -DR wrongly agreed t o remand the matter to the fi le of Ld. AO :
• In the ir written note at Page 4 Para 5 given to the H on 'ble Bench in this MA, the revenue has contended that the Hon'bl e Bench was mi sled by the AR of the assessee and out of utter respect to the Hon'ble Be nch, the CIT DR agreed on the i ss ue of additio nal gro und on the bas is th at as per AR it was not t aken before t he AO an d the CIT(A).
This portion of note of the reven ue is total ly deni ed and strongl y opp osed. It i s a personal attack on t he counsel. It is a personal att ack on the Instit ution of this Ho n' ble ITAT M.A.Nos.-214 to 217-Chd-2018 ITA Nos. 230 to 232-Chd-2017 Rakesh Tyagi and Others, Yamunanagar 23 and it is also a pers onal attack on t he C IT-DR. First ly, kindly see the grounds of appe al before the Honb le ITAT (original appeal memo) and als o filed before the CIT(A ) where this issue h as no t bee n raised. Further, on comparis on of co ntentions in t he synopsi s fil ed bef ore the Hon'bl e ITAT during hearing at that time and the contenti ons rais ed before the AO durin g asse ssment, it can be seen th at the as sessee has rais ed number of new contenti ons before th e Hon 'ble ITA T on other tange nts of val idit y of re- ope ning . Therefore, it was right ly appreciated an d accepted by t he Hon'bl e Bench as an additi onal ground, i t was admitte d an d finally , o n conse nsus between al l parties , it was rema nde d back to the file of AO. There fore, the personal al legation made by the revenue that th e AR misled the Be nch is totally incorrect. T he reve nue may please be directed t o fi le affidavit from their CIT DR prese nt at t hat ti me as to whether his co ncession was on mis leadi ng by the AR . E lse the revenu e may p leas e be di recte d to expunge this portio n of alle gati on from their argume nts.
7.3. Th at the AO havin g alre ady de alt wit h al l l imbs of s . 2 (47) i n the or der i n 1st round of as sess ment , re-de aling the s ame iss ue is not poss ible :
• In their MA, on m erits of the i ssue, the revenue has contended t hat the taxabi lity of subje ct JDA has already been examine d by th e AO from the pers pective of all clauses of s. 2(47) in the 1st round assessme nt order whic h inclu ded clauses (i i), (v) & (v i). Therefore, as per thei r stand in the MA, t he A O is not rea dy to re -do the same exercise on directio ns of Hon' ble IT AT. In our opinio n, this is also contemptuous . It is i n the wis dom of the Hon'ble Bench under its vast powers u/ s 25 4(1) to deci de the iss ue thems elves or t o get it re-examine d from any of the lower authority, be it AO or CIT(A) . Now to ch alle nge those directi ons t hrough MA is amo unting t o s it in judgme nt over the de cis ion of Hon'ble ITAT an d is also amount ing to file appeal agai nst t he decisi on of Hon'ble IT AT via MA be fore Hon'bl e IT AT itself. All this is impermis sible.
M.A.Nos.-214 to 217-Chd-2018 ITA Nos. 230 to 232-Chd-2017 Rakesh Tyagi and Others, Yamunanagar 24 • Ki ndly f urther not e that the ass essme nt order is dtd. 22.03.2 015 where the AO has held that execution of an unregistered JDA wi ll i nvite t axat ion u/s 2 (47) in t he ye ar of sig ni ng of JD A. At t hat time t he pre- dominant view o n this s ubje ct was in favour of re venue. E ven th e ITAT decisi on on t his iss ue at that time was in favour of revenue.
It is subs equent ly b y decis ion dt d. 22.07.201 5 that the Hon' bl e Juris dictiona l P &H Hi gh Court i n C.S. Atwal vs CIT 378 ITR 244, reve rsed the view of ITAT and held that mere signing of an unregis tere d JD A will not i nvite taxation . Th is was the n later-on uphe ld in CIT vs Bal bir s igh Maini 3 98 ITR 531 (SC) (2017). All this deve lopment through these de ci sio ns was not avail able when the AO pas se d the order but was av ail able whe n the Hon' ble ITAT was de ali ng w ith this matter. Appreci at ing this devel opment, t he Ho n'ble ITAT chos e to al low 2nd i nnin g to the A O. Now the s ayi ng of the A O in the MA that he has already dealt w ith t his i ss ue is in correct s ince it was not dealt i n the li ght of these subse que nt import ant decisi ons directl y on the subject in han d. Theref ore, the MA on t his issue raised by reve nue des erves to be dis mi ssed.
7.4 Prayer of reve nue in t heir MA is amou nti ng to seeking re view which be yond the s cope of s. 254(2) :
It can be s ee n from t he conte nts of the M A filed by rev enue that what they are see kin g is review of t he enti re order of Hon'b le ITAT under the garb o f s. 254(2) by misreprese nting it to be a prayer for recall . This is impermis sibl e as held i n CIT vs Rel iance Te l ecom Lt d. 440 ITR 1 (S C) (2022).
Further, the y have not specific ally po inte d out as to which para or line of the order of Hon 'ble IT AT cont ains any app arent mist ak e whic h ca n be corrected u/s 254(2). This is since the order does not actually contain any apparent mistake.
In view of above, the MA fi led by the reve nue be ing dev oid of merits des erves to be dismis se d. Appropri at e relief is pra yed .
M.A.Nos.-214 to 217-Chd-2018 ITA Nos. 230 to 232-Chd-2017 Rakesh Tyagi and Others, Yamunanagar 25
7. We have heard the rival contentions of both parties and perused the material available on re cord. Before we proceed to examine the order passed by the Tribunal, it is essential to set the record straight by referring to the relevant facts as recor ded in the assessment order. In this regard, we refer to paragraph 9 of the assessment order at page 24, which states as under:
"9. T h u s on c o n si de ra t io n o f a l l fac t s o f th e c a se a n d m at e r ia l on re co r d fol lo wi n g po i nt s em e r g e :
A . T he c ol l ab o ra ti on a gr e e me nt d a te d 2 9. 0 8 .2 0 0 7 an d t he t ra n s fe r o f c ap ita l a s s et h a s t ak e n p lac e in th e f i n an c i al y e ar 2 0 0 7 -0 8 re le v an t t o t he A ss e s sm e n t Y e a r 20 08 - 0 9 .
B. A s pe r t h e a g re e me n t th e re i s g ran t a n d a s s ign m e nt o f v a r io u s ri gh t s i n th e P ro pe rt y. The p hy s ic a l a nd v a ca n t p os s e s si o n s o f t he p ro p e r t y h a s h a nd ed o v er to t he bu ye r. T h e re i s t ra n s fe r o f c a p ita l a s se t in A. Y . 20 08 - 09 . A s p e r Se c 2 ( 1 4) 'c a p i ta l as se t ' m e an s p ro pe rty o f a n y kin d. Cap i ta l a s s e t i nc l u de s ev e r y k in d o f p ro p er t y a s g en e ra l l y u nd e rs t oo d, e x ce pt t ho s e are ex p re ss l y e xc lu de d f ro m t he d e fi n it io n . Si mi la rl y th e me a ni ng o f th e e xp re s s ion ' p ro p e rt y ' i nc l u de s e ve r y c on ce i v a ble t h i ng , ri g ht o r int e re s t .
C. T he i n co me t ax i s t o be c ha rg e d u nd e r t he h ea d 'C ap it a l ga in s ' o n a ny p ro f it on t r an sf e r of cap i ta l a s s e t a n d s h a l l b e de e me d t o b e in c o me o f t h e pre vio us y ea r i n wh i c h th e t r a n s fe r to ok p lac e (Se c 45 (1 ) ). I n t h i s ca s e t he tra n s fe r o f c ap it al a s s e t to ok p l a ce i n A . Y. 20 08 - 09 .
D . T he as s e s se e 's c a se is co v e re d b y th e ge ne ra l p ro vi si o n s o f Se c 45 (1 ) a n d a l so 2( 47 ) (i i ) e xti ng ui sh m en t of a n y r ig ht s t he re in. The c ase i s a ls o c o ve re d b y S e c .2 ( 47 )( vi ) a ny t ra n sa c t io n wh i ch h a s e f fe c t o f t ra n sfe rr i ng , o r e n ab li ng t h e e n j o y m e nt o f a n y im mo v a b l e p ro p e rt y .
E . Th e t ran s fe r of t he c a p i ta l as s e t by th e a s s e ss e e is a l so c ov er e d b y t he p rov i si on s of Se c . 2 ( 47 )( v) . T h is i s a c a s e o f a t ra n sa c ti o n i n vo l v i n g t he a ll o w in g of t he p o s se s s ion o f a n y im mo v a ble p rop e rt y g o be t a k e n o r re t a ine d i n p a rt p e r f orm a n ce of a c on tra c t o f th e na t u re re f e rre d t o in Se c t ion 5 3A o f th e T ran s fe r o f P rop e rt y A c t . Th e fa c t s o f th e c a se is c ove re d b y t he d e c i sio n in 25 6 I T R 28 2 (Ma d) M.A.Nos.-214 to 217-Chd-2018 ITA Nos. 230 to 232-Chd-2017 Rakesh Tyagi and Others, Yamunanagar 26 F. The fac ts o f t h e c a s e an d t he t e rm s o f th e col l a bo r at io n a gre e me n t re ve a l s t ha t c ol lab o ra t i o n ag re e me nt e n ab le s t he p as s i n g of d o mai n a nd c on t rol o f th e Pr o p ert y by g ran t o f i r re vo c ab le au th o r i t y . T h u s t he d a te o f th e a g re e me n t o f de ve lo pm e nt w i l l c on s t i tu t e t h e d a t e of t he t ran s fe r o f t h e ca p i t al a ss e t. Re l ia nc e c an b e pla c ed on Cha t ur b hu j D wa ri ka d a s K a pa d i a v C IT 2 60 I TR 4 91 ( Bo m).
G Se c. 4 8 of t h e A ct t a ke s in t o co n s ide ra tio n t h e fu ll v a lue o f t he c on si de rat io n r e c e i v ed o r a cc ru i n g a s a re su l t o f t h e t ran s fe r o f t he c ap ita l a sse t . I n th i s c as e th e f u ll va l u e of t h e co ns id e ra t i o n h a s a c crue d to th e a s s e ss e e i n t he A Y. 2 00 8 - 0 9.
11 . In v i e w o f a b ov e di s cu s s io n it is es t a bl is h ed t h a t la n d t r a n s f e r b y t he a s s ess e e v id e co l la b o r a t i o n a gr e e m en t d at e d 29 .0 8 . 20 0 7 i s t ra n s f er as p er p r o vi s i o n o f s e ct i o n 2 (4 7 )(v ) a n d (v i ) o f th e Inc o m e Tax A ct a n d Cap ita l ga i n e a r n ed on t h is tr a n sa ct io n i s t a x ab l e u /s 45 (1 ) o f t h e I nc o m e T a x Ac t 19 61 . Th e ca p i ta l g a in i n t h e h a nd s of t h e a ss es se e is c o mp u t ed a s u nd er : -
Fu l l va lu e o f c o n si d e r a ti on A ss es s e e 's s h a r e 1/ 1 0 x Rs .3 2, 00, 0 0, 0 0 0 / -Rs . 3, 2 0 ,0 0 , 0 0 0/ -
L ess : I n d e x c o s t o f a cq u is it i o n 35 80 02 x 78 5/ 4 97 Rs . 5, 6 5 , 45 5 / -
Co s t of a c q u is it i o n et c. Rs. 3 ,5 8, 0 0 2/ -
[½ o f Rs . 7, 1 6, 0 0 3 / -( 6 6 2 5 0 0 +5 30 00 + 50 3 )] L on g T e r m Ca p i t a l Ga i n Rs .3 , 1 4, 3 4 , 5 4 5/-
8. Besides the above, if we refer to paragraphs 4 and 5 of the assessm ent order, it is amply clear that the assessee had raised objections against the issuance of notice under section 148 of the Act. The Assessing Officer, by his order dated 25.07.2014, had disposed of the objections filed by the assessee. In fact, this order forms part of the assessment order itself, appear ing at pages 5 and 6. The relevant portion of the said order is as follows:
M.A.Nos.-214 to 217-Chd-2018 ITA Nos. 230 to 232-Chd-2017 Rakesh Tyagi and Others, Yamunanagar 27 No . A CI T / Y N R/ 20 1 4- 1 5/ O ff ic e o f t h e Dy . Co m mi ss i on e r o f I n c o m e Ta x, Ci rc l e , Ya mu na Na g a r.
Dat ed : 25 .0 7. 20 14 To Sh . Ra ke sh K um a r T yag i , S /o S h . I sh wa r Du t t, Gob i nd p u r i, Ya mu na N a ga r.
Sir , Su b: S p e akin g o rde r in re p l y to ob je c tio n s ra i s e d i n th e c as e of S h . R ak es h K u ma r T yag i R /o Go bi n dp u r i , Y amun a N a g a r fo r t h e A s se ss m e nt Ye a r 2 0 08 - 09 P A N :
ACX P T 3 5 3 8 K - R eg a rd in g -
P l e a s e re fe r to yo u r l e tt e r da t ed 0 7. 07 .2 0 1 4 rec e iv e d i n t hi s o f fi c e o n 2 1. 07 .2 0 1 4 o n th e a b o ve no t ed su bj ec t .
2. In re s pe c t o f th e o bje ct ion tha t y e a r o f ta x a b ili t y ha s n o t be e n a sc e rt a i ne d , i t i s s t at e d t ha t t h e t a xa bi l i t y o f c a pit a l g a in in re sp ec t o f p rop e r ty /l an d t ran s f e rre d vi de c o ll a b orat i o n a g re e me n t d at ed 2 9. 08 .2 00 7 i s fo r t he a s se s s me n t ye a r 20 08 - 09 sin c e t h e t ra n s fe r o f lan d h a s t ak en p l a ce on 2 9 .0 8. 20 0 7 vi d e a g re e me n t d at ed 2 9. 08. 2 00 7. The a s se s s i ng o ff i ce r, i n t he re as o n s re co rd e d u / s 1 47 , i s v e ry c le a r o n t h i s as p ec t .
3. I n re s pe c t o f o b j e ct i o n t ha t t h e a s s es s i n g o f fi ce r is un cl e ar ab ou t t he h e a d un d e r wh i c h t he i nc o m e i s t ax a ble , i t i s b ro ug h t to y ou r n ot i ce t h at th ro u gh o ut t he re as on s so re c or de d u/ s 1 4 7, t he a s se ss ing o f f ic e r is cl e a r a bo u t e s cap e me n t o f i nc om e on ac co un t o f c ap i t a l ga i n s o n t ra ns fe r o f lan d . Th e a s se s sin g o f fic e r i n i t s rea s on s ha s re b ut te d th e a rgu m e nt s o f t he a ss e s s ee s o ca l led f o r u / s 1 33 ( 6 ) i n re sp ec t of t h e a s s e s se e 's c la i m t h at t he p ro pe rt y / lan d wa s co nv e r t ed by h im a s st o c k in t ra d e is n o t ch arg ed t o c ap i t al g ai n s.
4. I n re s pe c t o f o bj ec t i on t ha t t he a ss e s s ing o f fic e r i s n ot c le a r a bo ut th e d o c u me n ts o n t h e ba s i s of wh ic h t h e p rop e rty /l an d i s t o b e ta xe d , it i s st at e d t h at t he a s s es s in g of f ic e r is c le a r th ro ug h ou t t he re a s o n s & it h a s be e n di sc u s se d e xh au s t iv e ly th at t he p a re n t d oc ume nt i e. co ll a bo ra tio n ag re em e nt da te d 2 9 . 0 8. 20 07 i s t h e d oc ume nt o n th e b as i s o f wh ic h tr a ns fe r o f p ro p e rt y /la n d h a s be e n m ad e & ta x ab i l it y o n ac c o un t of c a p it a l g a i n s a ri se s i n re s p ec t o f a bo v e.
M.A.Nos.-214 to 217-Chd-2018 ITA Nos. 230 to 232-Chd-2017 Rakesh Tyagi and Others, Yamunanagar 28
5. It i s s t at ed th a t t he r ea s on s s o re c o rd ed w h il e i s su i n g n ot ice u / s 14 8 a re v a li d a s p e r l a w & on m e rit s . T h e as s e s si ng of f i ce r ha s p ro p e r s at i s fa c t ion t o b e li e ve t ha t e sc a pe m e nt o f i nco m e h a s ta ke n p l ac e d ue to n on c h ar g in g of ca p it a l ga i n i nco m e o n a cc o un t o f t ra n s fe r o f lan d . T h e a s se ss ing o f f ice r on a pp li c a tio n o f mi n d ha s p ro p e r re a so n s t o be l i e v e th at e s ca pe men t o f i n co m e h a s o c cu rre d i n re sp e ct o f ab ov e m e n tio ne d la n d.
You r s fai th ful l y , Sd/-
(Z a h id Pa rv ez ) As s tt . Co m mi s s io n e r o f I nco m e T a x, Ci rc l e, Yam u na Na g a r.
9. It is also pertinent to mention that while the assessee did prefer an appeal before t he CIT(A), the issue of validity of reopening under section 147 was not agitated bef ore the said authority--consequently, the appellate order passed by the Ld. CIT(A) is silent on this issue.
10. In the above background, the assessee raised an additional ground before the Tribunal challenging the legality of the reassessment. The Tribunal, in paragraph 6 of its order, recor ded this additional ground and proceeded on the footing that the Assessing Officer had not adjudicated the said issue. On that basis, the matter was remanded to the Assessing Officer with a direction t o pass a f resh speaking order in t erms of paragraph 9 of the Tr ibunal's order.
11. Ho wever, as the record now clear ly shows, the Assessing Officer had in fact adjudicated this jurisdictional objection in the assessment proceedings themselves. Therefore, the Tribunal's observation that the AO had not examined the issue M.A.Nos.-214 to 217-Chd-2018 ITA Nos. 230 to 232-Chd-2017 Rakesh Tyagi and Others, Yamunanagar 29 was factually incorrect. It is also brought to our notice that the assessee Devi Dayal (PAN: AAJPD5851H), who was part of the common group of appeals, was not include d in the rectification applications filled by the r evenue. However, a similar issue arose in his case and the AO had already complied with the Tribunal's directions by reiterating the original findings in the giving effect order.
12. The Ld. DR contended that remanding the matter to the Assessing Officer in such a situation is an exercise in futility, as the issue was alr eady considered in the original asse ssment proceedings. The Tribunal's remand dir ection, being based on an erroneous factual assumption, ther efore constitutes a mistake apparent from the record. W e find merit in this contention.
13. The test under section 254(2) is whether there is a mistake which is patent, obvious and self-evident. In the present case, the Tribunal pr oceeded on the incorr ect assumption that the Assessing Officer had not adjudicated on the validity of reopening under Section 147. This error , having led to a remand of the matter, is an error apparent from the record and liable to be rectified.
14. In our considered view, the remand of the matter to the Assessing Officer in par agraph 9 of the Tribunal's order was not warranted and requir es modification. Since the issue was not adjudicated by the CIT(A), the appropriate cour se would M.A.Nos.-214 to 217-Chd-2018 ITA Nos. 230 to 232-Chd-2017 Rakesh Tyagi and Others, Yamunanagar 30 have been to remand the matter to the CI T(A) for consideration of the additional legal ground. Accordingly, we deem it just and proper to modify paragraph 9 of the Tribunal's order dated 03.04.2018 by substituting the words "Assessing Officer" with "CIT(A)". The direction shall now be read as under:
9. We have heard the submissions and perused the material available on record. It is seen that the assessment order has been passed considering the merits of the arguments raised by the assessee. The CIT(A) in appeal, it is seen proceeded to partly agree with the assessee, "Therefore, in view of above, 1 am of the view that there is an extinguishment of right in the capital asset by the appellant vide collaboration agreement dated 29.08.2007 as per sub clause (ii) to section 2(47) which is further supported by clarification of word 'transfer' by Explanation (2) below section 2(47). So, there is 'transfer' of capital assets as per the inclusive definition u/s 2(47) during the year under consideration." Since the assumption of jurisdiction itself is questioned, by the assessee which aspect has not been considered by the tax authorities. Accordingly, in these circumstances without getting into the aspect of correctness of the order under challenge which is stated to have not been challenged by the Revenue and thus according to the assessee, the issue which remains open for consideration is only the applicability of Section 2(47)(ii), we deem it appropriate to not get into this debate and set aside the impugned order back to the file of the Ld. CIT(A) with the M.A.Nos.-214 to 217-Chd-2018 ITA Nos. 230 to 232-Chd-2017 Rakesh Tyagi and Others, Yamunanagar 31 direction to pass a speaking order in accordance with law after giving the assessee a reasonable opportunity of being heard.
15. In the light of the above, Miscellaneous Applications filed by the Revenue are allowed. However, we deem it appropriate to express our displeasure at the tone and tenor adopted in the drafting of the Miscellaneous Applications, wherein certain unwarranted allegations have been levelled against the Ld. Author ised Representative for the assessee. Such language and im putations are wholly inappropriate in pleadings before a quasi-judicial forum and do not advance the cause of justice. The Revenue is advised to exercise caution and maintain decorum in future pleadings.
16. In the result, all the MAs are allowed to the aforesaid exte nt.
O r d e r p ro n o un ced o n . 05 . 20 2 5 .
Sd/- Sd/-
(KRIWANT SAHAY) (LALIET KUMAR)
Accountant Member Judicial Member
"आर.के."
आदे श क त ल प अ े षत / Copy of the order forwarded to :
1. अपीलाथ / The Appellant
2. यथ / The Respondent
3. आयकर आयु त/ CIT
M.A.Nos.-214 to 217-Chd-2018
ITA Nos. 230 to 232-Chd-2017
Rakesh Tyagi and Others, Yamunanagar
32
4. वभागीय त न ध, आयकर अपील य आ धकरण, च डीगढ़/ DR, ITAT, CHANDIGARH
5. गाड फाईल/ Guard File सहायक पंजीकार/ Assistant Registrar