Income Tax Appellate Tribunal - Ahmedabad
Acit.,Circle-8,, Surat vs Jayantibhai Dahyabhai Patel, Surat on 5 May, 2017
IN THE INCOME TAX APPELLATE TRIBUNAL
AHMEDABAD "D" BENCH AHMEDABAD
BEFORE, SHRI S. S. GODARA, JUDICIAL MEMBER
AND SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER
ITA No. 2448/Ahd/2012
(Assessment Year:2006-07)
The Assistant Commissioner of Income-tax,
Circle-8, Surat, Room No. 410, Aayakar
Bhavan, Majura Gate, Surat Appellant
Vs.
Shri Jayantibhai Dahyabhai Patel
B/h. Moti Bahucharji Mandir,
Ved Road, Surat- 395004 Respondent
PAN: CTZPS1506B
&
ITA Nos. 2308, 2449 & 2450/Ahd/2013
(Assessment Years : 2003-04 & 2006-07)
The Income-tax Officer,
Ward. 8(1), Surat Appellant
Vs.
Shri Anilbhai Shamjibhai Patel
G-9, Laxmi Darshan Complex,
Dabholi Char Rasta, Opp.
Swaminarayan Temple,
Ved Road, Surat- 395004 Respondent
PAN: AJMPM5019Q
ITA Nos. 2448/Ahd/12, 2308, 2449 & 2450/Ahd/2013 [ ACIT/ ITO vs.
Shri Jayantbhai D. Patel & Shri Anilbhai S. Patel] -2-
राज व क ओर से/By Revenue : Shri Pradip Kumar Majumdar,
Sr. D.R.
आवेदक क ओर से/By Assessee : Shri M. K. Patel, A.R.
सन
ु वाई क तार ख/Date of Hearing : 02.05.2017
घोषणा क तार ख/Date of
Pronouncement : 05.05.2017
ORDER
PER S. S. GODARA, JUDICIAL MEMBER
These four Revenue's appeals pertain to two different assessees. It has filed first appeal ITA No.2448/Ahd/2012 for assessment year 2006-07 against the CIT(A)-V, Surat's order dated 08.08.2012 in case no. CAS- V/217/2011-12, deleting addition of Rs.80,60,980/- in the nature of unaccounted sale proceeds as made by the Assessing Officer in assessment order dated 20.12.2011, in proceedings u/s.144 r.w.s. 147 of the Income Tax Act, 1961; in short "the Act".
2. The Revenue's next three appeals relate to the latter assessee Shri Anilbhai Shyamjibhai Patel. Former assessment year in the instant assessee's case is 2003-04 involving Revenue's two appeals ITA No. 2308/Ahd/2013 against the very CIT(A)'s order dated 26.06.2013 in case no. CAS/V/69/2012-13 reversing Assessing Officer's action making unexplained investment addition of Rs.50lacs in assessment order dated 24.12.2010 in proceedings u/s.144 of the Act. Latter appeal ITA No.2449/Ahd/2013 in the impugned assessment year seeks to revive Section 271(1)(c) penalty of Rs.30,95,400/- pertaining to the above quantum addition of unexplained investment amounting to Rs.50lacs. The Assessing ITA Nos. 2448/Ahd/12, 2308, 2449 & 2450/Ahd/2013 [ ACIT/ ITO vs. Shri Jayantbhai D. Patel & Shri Anilbhai S. Patel] -3- Officer had imposed the said penalty in his order dated 22.06.2011 as deleted in the lower appellate proceedings. The Revenue's fourth appeal in assessment year 2006-07 challenges the very CIT(A)'s order dated 01.08.2013, in case no. CAS/V/68/2012-13, deleting unexplained investment addition of Rs.40,30,487/- as made by the Assessing Officer in assessment order dated 16.12.2011 in proceedings u/s.144 r.w.s. 147 of the Act.
Heard both the parties. Case files perused.
3. It emerges from the above narrated pleadings that the Revenue's all four appeals except ITA No.2449/Ahd/2013 pertain to quantum proceedings whereas the above captioned appeal is consequential penalty litigation in latter assessee's case. The said three quantum appeals admittedly emanate from a search dated 26.03.2009 in case of one Shri Ghanshyam D Sutaria. The department appears to have seized a sale agreement between former assessee Shri Jayantibhai D Patel (vendor) and the instant latter assessee / vendee. The same allegedly indicated purchase price of the properties involved therein forming subject matter of the land transaction between the parties. This agreement appears to be dated 03.12.2005. The Assessing Officer first of all made the impugned addition of Rs.50lacs as capital gains in the hands of the abovestated vendor/former assessee. The very sum thereafter stood added as unexplained investment in the hands of latter assessee Shri Anilbhai in assessment year 2003-04 involving quantum appeals ITA No.2308/Ahd/2013 and consequential penalty appeal ITA No.2449/Ahd/2013 (supra). The department further appears to have added similar alleged unaccounted sale figures of Rs.80.60lacs in case of former assessee's case in assessment year 2006-07 and consequential addition of unexplained investment of Rs.40.30lacs in the latter assessee's hands in the ITA Nos. 2448/Ahd/12, 2308, 2449 & 2450/Ahd/2013 [ ACIT/ ITO vs. Shri Jayantbhai D. Patel & Shri Anilbhai S. Patel] -4- very assessment year as indicated in preceding paragraphs. It transpires from the case file that the CIT(A) has followed his order dated 22.05.2012 in former assessee's case for assessment year 2003-04 holding therein that the above agreement did not amount to transfer of the property in question. He then adopts the very analogy in the three identical appeals herein to delete the above corresponding as well as identical additions. It further transpires that all this has resulted in dropping of penalty as well in latter assessee' case forming subject matter of adjudication in ITA No.2449/Ahd/2013. This leaves the Revenue aggrieved to the extent indicated in its pleadings.
4. Shri Patel states at the outset that there is no dispute about the CIT(A) having deleted all quantum additions as well as the consequential penalty in latter assessee's case by following his earlier order in former assessee's case in assessment year 2003-04. He then files before us a co-ordinate bench's order dated 29.09.2015 in ITA No.1802/Ahd/2012 in former assessee's case remitting the main quantum issue back to the Assessing Officer as under:
"6. With the assistance of ld. D.R., we have gone through the record carefully. On due consideration of the record, we are of the opinion that order of the ld. First Appellate Authority is not sustainable and this issue deserves to be set aside to the file of Assessing Officer for re-adjudication. It emerges out from the record that during course of survey carried out at the premises of third person, copy of the alleged sale agreement was found. This document has been made as a basis for concluding that assessee had sold a piece of land which has resulted him capital gain. Ld. Assessing Officer has totally failed to notice whether assessee was actually owner of this land. He failed to collect information from the office of the Registrar exhibiting whether the land has actually been transferred or not. If the land had actually been transferred then whether a long term capital gain has resulted to the assessee or a short term capital gain. What was the cost of acquisition in the hands of the assessee not discernable, the ld.AO has added total sale consideration as gain. On appeal, ld. First Appellate Authority failed to give any finding exhibiting his satisfaction for concluding that no property was transferred. The assessment order is an ex ITA Nos. 2448/Ahd/12, 2308, 2449 & 2450/Ahd/2013 [ ACIT/ ITO vs. Shri Jayantbhai D. Patel & Shri Anilbhai S. Patel] -5- parte order. The assessee has not brought any evidence on record in rebutting the conclusion of the Assessing Officer. The ld. CIT(A) has reproduced the submissions of the assessee whereby he has contended that plot in dispute was ownered by 15 persons jointly. Though, agreement was executed but all the owners did not agree for sale of the plot and therefore, no sale had taken place. In support of this, assessee has filed a copy of Form NO.7/12, but to our mind, this is not a conclusive proof of ownership. The authorities ought to have obtained the report from the revenue authorities of the State Government. Ld. CIT(A) also did not call for a remand report from the Assessing Officer on this fresh evidence taken into consideration by him. Therefore, the order of the CIT(A) is also not sustainable. Considering all these factors, we set aside the order of the CIT(A) and restore this issue to the file of Assessing Officer for a fresh adjudication. The observations made by us will not impair or injure the case of the Assessing Officer and will not cause any prejudice to the defense/explanation of the assessee. Ld. Assessing Officer shall provide due opportunity of hearing to the assessee."
5. The assessees therefore is very fair in seeking remand directions in the in the instant appeal as well. Learned Departmental Representative does not dispute all these developments. We therefore adopt the very course of action herein as well in the three quantum appeals ITA No. 2448/Ahd/2012, 2308 & 2450/Ahd/2013 before us. The Assessing Officer shall ensure that the assessees are afforded adequate opportunity of hearing for adjudicating the above crucial issue of transfer of ownership of the lands in question. These three appeals are accordingly accepted for statistical purposes.
6. Coming to Revenue's penalty appeal ITA No.2449/Ahd/2013, it had admittedly come on record that the assessee has already succeeded on quantum addition of unexplained investment of Rs.50lacs (supra) before the CIT(A). The fact however also remains that we have remitted the same back to the Assessing Officer for afresh adjudication. We thus conclude that the impugned penalty has not legs to stand as of now. The Assessing Officer however shall have liberty to proceed afresh initiating the very penalty proceeding if the facts and circumstances so warrant in ITA Nos. 2448/Ahd/12, 2308, 2449 & 2450/Ahd/2013 [ ACIT/ ITO vs. Shri Jayantbhai D. Patel & Shri Anilbhai S. Patel] -6- consequential assessment. ITA No.2449/Ahd/2013 is declined in above terms.
7. The Revenue's three appeals ITA Nos.2448/Ahd/2012, 2308 & 2450/Ahd/2013 are accepted for statistical purposes. Its further appeal ITA No. 2449/Ahd/2013 is dismissed.
[Pronounced in the open Court on this the 5th day of May, 2017.] Sd/- Sd/-
(PRADIP KUMAR KEDIA) (S. S. GODARA)
ACCOUNTANT MEMBER JUDICIAL MEMBER
Ahmedabad: Dated 05/05/2017
True Copy
S.K.SINHA
आदे श क त ल
प अ े
षत / Copy of Order Forwarded to:-
1. राज व / Revenue
2. आवेदक / Assessee
3. संबं धत आयकर आयु!त / Concerned CIT
4. आयकर आयु!त- अपील / CIT (A)
5. )वभागीय ,-त-न ध, आयकर अपील य अ धकरण, अहमदाबाद /
DR, ITAT, Ahmedabad
6. गाड3 फाइल / Guard file.
By order/आदे श से,
उप/सहायक पंजीकार
आयकर अपील य अ धकरण, अहमदाबाद ।