Income Tax Appellate Tribunal - Chennai
A.Vinod Kumar Reddy, Chennai vs Dcit, Chennai on 7 June, 2017
आयकरअपील यअ धकरण, 'बी' '' यायपीठ, चे नई
IN THE INCOME TAX APPELLATE TRIBUNAL
''B''BENCH, CHENNAI
ीचं पूजार , लेखा सद य एवं ीध"ु व#
ु आर.एलरे $डी, या&यकसद यकेसम(
BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND
SHRI DUVVURU R.L. REDDY, JUDICIAL MEMBER
M.P.No.98/Mds/2017
(आयकर अपील सं./I.T.A. No.2657/Mds/2016)
&नधा)रण वष) /Assessment year : 2011-2012.
Shri. A. Vinod Kumar Reddy, Vs. The Deputy Commissioner of
4th floor, Bay Watch Apartments, Income Tax,
No.92/93, Costal Road, Business Circle -II,
Besant Nagar, Chennai 600 090. Chennai.
[PAN ABOPV 6636N]
(Petitioner) (Respondent)
अपीलाथ, क- ओर से/Appellant by : Shri. S. Sridhar. Advocate
/0यथ,क-ओरसे/Respondent by : Shri. Murali Mohan, Addl. CIT.
सन
ु वाईक-तार ख/Date of Hearing : 02.06.2017
घोषणाक-तार ख/Date of Pronouncement : 07.06.2017
आदे श /O R D E R
PER CHANDRA POOJARI, ACCOUNTANT MEMBER:
By this Miscellaneous Petition assessee seeks rectification order of the Tribunal in ITA No.2657/Mds/2016 dated 17.02.2017. 2 M.P. No.98/Mds/2017
2. It was observed from the case records that originally assessee's case came before this Tribunal challenging treating the total of A4,75,10,880/- being the profit worked out on sale of land at Thalambur as taxable income under the head ''income from capital gains''. Assessee also raised another ground with regard to alternative treatment by ld. Assessing Officer regarding gain on such transaction as benefit granted to the assessee by the company being the purchaser in which he is a director and also holds substantial interest as deemed income u/s.2(24)
(iv) of the Income Tax Act, 1961 (in short ''the Act''). The Tribunal adjudicated the appeal in its order dated 17th February, 2017 and given an finding at paras 9.1 & 9.2 as under:-
"9.1 In view of the above discussion, we are of the opinion that the land in question cannot be considered as stock in trade in the hands of assessee. It is nothing but agricultural land in terms of Sec. 2(14)(iii) r.w.s. 10(1) of the Act and transfer of that land cannot lead to taxable capital gains or income from business.
9.2 Further, it is also be noted that our above view is also supported by the recent judgment of Jurisdictional High Court in T.C.A. No.483/2016 dated 01.09.2016 in the case of M/s. Mansi Finance Chennai Ltd. In view of the above, we direct the Assessing Officer to consider gain on sale of impugned land as exempted from capital gains and to treat as agricultural income only. Accordingly, we allow the ground taken by the assessee in his appeal''.3 M.P. No.98/Mds/2017
3. Now the contention of the ld. Authorised Representative in its Miscellaneous Petition is that the Tribunal adjudicated the issue relating to the taxing the gain on agricultural land as not taxable as it is exempted from tax as capital receipts. However, the Tribunal failed not to adjudicate the issue of applicability of provisions of Sec. 2(24)(iv) of the Act with regard to the deemed income on transfer of agricultural land to a company in which the assessee is a director and holding substantial interest in that company. The ld. Authorised Representative further submitted that the assessee raised the ground with reference to applicability of Sec. 2(24)(iv) of the Act which was not adjudicated and the same may be adjudicated or the order may be recalled so as to adjudicate the same.
4. On the other hand, ld. Departmental Representative submitted that applicability of Sec. 2(24)(iv) of the Act is not adjudicated by the Tribunal and the order may be recalled for adjudication of the same.
5. We have heard both the parties and perused the material on record. In this case as seen from the order of the Tribunal, the Tribunal considered entire issue in dispute in a cumulative manner and decided the issue in favour of the assessee. With regard to capital gain on transfer of the landed property, it is held that it is exempted from tax, this can be seen from the grounds and facts recorded by the Tribunal in 4 M.P. No.98/Mds/2017 paras 2 to 3.3 by giving them a finding that gain out of transfer of the landed property cannot be taxed in the hands of the assessee. At that stage, the Tribunal was of the opinion that once it was observed that capital gains on sale of agricultural land was exempted u/s. 10(37) of the Act, it does not warrant adjudication of the said issue u/s. 2(24) (iv) of the Act and it was of the opinion of the Tribunal that it was only academic, which does not require any adjudication. There is one more reason for the Tribunal for not giving specific finding on this issue is that there is no computation of income u/s. 2(24)(iv) of the Act either by ld.AO or by ld. Commissioner of Income Tax (Appeals). The lower authorities have not explored the applicability of provisions of Sec. 2(24)(iv) of the Act specifically comparing the fair market value of the landed property and the sale price at which the landed property which was sold by the assessee to the company. In other words, to apply the provisions of Sec.2(24)(iv) of the Act it is incumbent or mandatory on the part of ld. Assessing Officer to bring on record the difference between fair market value and sale price at which the property was sold by the assessee to the company. The entire gain on sale of landed property cannot be considered as deemed gain u/s. 2(24)(iv) of the Act. In this case more specifically there is no dispute regarding the value declared by the assessee on sale of the landed property and the value of the landed property disclosed in the sale deed which was accepted by 5 M.P. No.98/Mds/2017 the State Valuation Authority and there was no allegation by the ld. Assessing Officer regarding declaring of the sale value less than value adopted by the State Valuation Authority for registration purpose. From this point of view also, there is no question of invoking provisions of Sec. 2(24)(iv) of the Act. As such the Tribunal in earlier occasion was of the opinion that mentioning of Sec. 2(24)(iv) of the Act by the ld. Assessing Officer in its order was a passing remark as such the Tribunal was not dwell upon on it. It is to be said that there is no error in the order of the Tribunal so as to recall it. The order of the Tribunal has not to be scrutinized sentence by sentence merely to find out whether all facts have been set out, in detail by the Tribunal or whether some incidental fact which appears on the record has not been noticed by the Tribunal in its judgment. If the court, on a fair reading of the judgment of the Tribunal, finds that it has taken into account all relevant material and has not taken into account any irrelevant material in basing its conclusions, the decision of the Tribunal is not liable to be interfered with, unless, of course, the conclusions arrived at by the Tribunal are perverse. It is not necessary for the Tribunal to state in its judgment specifically or in express words that it has taken into account the cumulative effect of the circumstances or has considered the totality of the facts, as if that were a magic formula; if the judgment of the Tribunal shows that it has, in fact, done so, there is no reason to interfere with the decision of the Tribunal. 6 M.P. No.98/Mds/2017 Accordingly, we do not find any apparent reason to recall the earlier order of the order and it is suffice to say that the order of the Tribunal to be considered as allowed in favour of the assessee in its entirety and no ground decided against assessee in his appeal. With this observation, we are inclined to dismiss the Miscellaneous Petition filed by the assessee.
6. In the result, the Miscellaneous Petition filed by the assessee is dismissed.
Order pronounced on Thursday, the 7th of June, 2017, at Chennai.
Sd/- Sd/-
(ध"ु व#
ु आर.एलरे $डी) (चं पज
ू ार )
Duvvuru R.L. Reddy) (Chandra Poojari)
या&यक सद य/Judicial Member लेखा सद य/Accountant Member
चे नई/Chennai,
Hदनांक/Dated, the 7th June, 2017.
KV
Copy to: Petitioner/Respondent/CIT(A)/CIT/DR