TMI Blog2015 (9) TMI 124X X X X Extracts X X X X X X X X Extracts X X X X ..... xemption u/s.54F - investments in agricultural land made in the name of the assessee’s son - Held that:- From the sale deed, it is evident that the property belonged to the HUF of the assessee because the land sold was inherited by the assessee and the entire members of the assessee’s HUF are entitled to the property inherited by the assessee from his father’s HUF. Since the existence of the HUF cannot be denied who owned the land sold, the assessment made in the hands of the assessee in the individual capacity is bad in law. Moreover as per section 171 of the Act, partial partition is not recognized for the purpose of assessment under the provisions of the Act. Hence it is apparent that the Revenue has assessed the assessee as “individual” wrongly for the sale of land owned by the assessee’s HUF. Therefore we hereby quash the order of the Ld. A.O. Further we make it clear that the Revenue is at liberty to assess the assessee’s HUF subject to complying with provisions of limitations stipulated in the Act and in accordance with our decision in this order on various issues raised by both the parties. We also make it clear that while assessing the assessee’s HUF, the HUF assessee shal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the agricultural land. 2.2 Cross Objections The assessee has raised six grounds in his C.O, however, the cruxes of the issues are that:- i) The Ld. CIT(A) has erred in sustaining the action of the Ld. Assessing Officer in denying exemption u/s.54B of the Act for ₹ 2,92,140/- with regard to investments in agricultural land made in the name of assessee s son. ii) The Ld. CIT(A) has erred in sustaining the action of the Ld. Assessing Officer in denying exemption u/s.54F of the Act in regard to construction of the building in the land purchased at Vallingadu by holding that only extension to the existing building has been carried out. iii) The Ld. Assessing Officer has erred in levying interest u/s.234A 234C of the Act. 3. The brief facts of the case are that the assessee is an individual, filed his return of income for the assessment year 2009-10 on 31.03.2011 U/s.139(4) of the Act admitting income of ₹ 2,79,057/-and agricultural income of ₹ 61,000/-. Subsequently it was learnt that the assessee had sold land for ₹ 6,90,00,000/- which was not disclosed in his return of income. Thereafter, notice U/s.148 of the Act was issued and the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2,30,00,000/ 3 R.Kalaiarasi (assessee s daughter) Indian Bank, Thudialur Branch 788610044 30.8.2008 30.8.2008 30.8.2008 90,00,000/- 90,00,000/- 90,00,000/- 2,30,00,000/ As is apparent from the above table, the earliest credit is only on 16.8.2008. Examination of bank account jointly held by Shri. Seethapathy Naidu (seller of Velliangadu property to the assessee ) and his daughter Smt. Suganthini with State Bank of India, Personal Banking Branch, Ram Nagar, Coimbatore ( where the proceeds from sale of land to assessee Shri.M. Ramalingam have been deposited ) revealed remittance of cash amounting to ₹ 1,00,00,000/- on 13.8.2008. Since the earliest credit for the assessee is only on 16.8.2008, to verify the source for payment made by the assessee on 13.8.2008, summon u/s.131 was served on the assessee and a sworn statement recorded from him on 8.2.2013. When assessee was requested to furnish the source for the above cash payment of ₹ 1,00,00,000/- made on 13.8.2008,assessee agreed to offer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eration and not as Income from Other Sources . This ground of appeal is ALLOWED. 4.3 Ld. D. R argued in support of the order of the Ld. Assessing Officer, and on the other hand Ld. A. R argued in support of the order of the Ld. CIT (A). 4.4 After hearing both the sides and perusing materials on record, we are also of the considered view that the amount of ₹ 1/- crore received by the assessee which was advanced to Mr. Seethapathy Naidu on 13.08.2008 would be the on-money received by the assessee towards the sale of his land on 11.8.2008, since the Revenue has not established any other source of income that could have been earned by the assessee during the relevant previous year. The only transaction of the assessee during the relevant previous year was sale of agricultural land. The Ld. Assessing Officer has also not made any finding with respect to the other activities of the assessee for earning income from any other source. Moreover it is a common practice to accept on-money on real estate transactions. Therefore, we do not find it necessary to interfere with the order of the Ld. CIT (A) on this count. Cross Objections. 5.1 Ground No.1 Denial of exempti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... partition in respect of our family properties under a registered Partition Deed document No.6509 dated 25.10.2007. As per the Partition, North-South on the Western Side admeasuring Ao.6.00 out of Ac.9.10 under A Schedule was allotted to M.Palanisamy and likewise North-South on the Eastern side admeasuring Ac.3.10 out of Ac.9.10 under C schedule was allotted to Vendor No.1. Thus, the Vendor No.1 has become entitled to the schedule mentioned property described hereunder, Whereas the Vendors No.2 3 are entitled to the under mentioned properties by heirship. Whereas the Vendors are in peaceful possession and enjoyment over the under mentioned property till date. From the sale deed, it is evident that the property belonged to the HUF of the assessee because the land sold was inherited by the assessee and the entire members of the assessee s HUF are entitled to the property inherited by the assessee from his father s HUF. Since the existence of the HUF cannot be denied who owned the land sold, the assessment made in the hands of the assessee in the individual capacity is bad in law. Moreover as per section 171 of the Act, partial partition is not recognized for the purpose of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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