TMI Blog2017 (8) TMI 329X X X X Extracts X X X X X X X X Extracts X X X X ..... 6231/Del/2016 - - - Dated:- 20-4-2017 - SHRI B.P. JAIN, ACCOUNTANT MEMBER For The Assessee : S/Shri Sankalp Anil Sharma, Adv. For The Revenue : Ms. Bedobani Chaudhuri, Sr.D.R. ORDER This appeal of the Revenue arises from the order of learned CIT(A), Dehradun, vide order dated 23.09.2016 for the assessment year 2011-12. 2. The Revenue has raised the following grounds of appeal. 1. That the ld. CIT(A) has erred in law and on facts by giving more importance to the unregistered agreement than to the legal registered deeds. 2. That the ld. CIT(A) has erred in law and on facts by deleting the addition of ₹ 11,66,616/- made by the AO on account of capital gain without appreciating the facts that the land was sold by making small residential plots to various parties before sale thus losing the Agricultural nature of land. 3. That the ld. CIT(A) has erred in law and on facts in deleting the addition of ₹ 26,81,000/- by not appreciating the facts that various amounts were deposited/credited in the account of the assessee much before the date of sale and the assessee failed to explain the source of whole amount. 3. The brief fact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t cannot be used against the assessee. What emerges from the agreement for sale IS that the assessee upon receipt of Rs. 30 lakhs,transferred the control of the land to Shri S. Ahmed and Shri AP. Semwal for the purposes of development of plots from the said land and agreed to present himself for registration as and when asked to. Thus, the lands stood transferred as per sub clause (v) of clause (47) of section 2 of the I. T. Act. Thereafter the beneficial Interest acquired by Shri S . Ahmed and Shri AP. Semwal was apparently sold to one Shri Tajbar Singh Bhandari resident of Kotdwar and the balance money was paid in cash to the assessee. The payment of this money has been confirmed by Shri AP. Semwal and Shri Shamim Ahmed through whom it Was paid. Thereafter, upon instructions the registrations were performed in the name of certain different individuals. The entire exercise seems to have taken place in a manner to evade payment of stamp duty, first on the transfer of land to Shri A.P. Semwal and Shri S. Ahmed and then on transfer from A.P. Semwal and S. Ahmed to Tajbar Singh Bhandari. Even the final registrations have been done at circle rat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ar Singh Bhandari and the final purchasers, to bring the unexplained investment to tax in their hands. 28. It appears that in pursuance of such findings and directions, the AO has taken up enquiries in the case of Shri Tajbar Singh Bhandari. In the course of these enquiries the statement of the assessee has also been recorded on 8.02.2-016. It appears from perusal of question number 9 of the said statement, that some of the ultimate purchasers have admitted that though the registration was done as per the circle rate the actual amount that was paid was three to four times the amount. They have also apparently claimed that they paid directly to the assessee, while the assessee says that he received it through Ayodhya Prasad Semwal and Shamim Ahmad. Thus the claim of the assessee that the money credited to his bank account was actually sale proceeds of his agricultural land at Shivrajpur, Motadhak, which was earlier corroborated by Shri Ayodhya Prasad Semwal and Shri Shamim Ahmad is now strengthened by such statement from the purchasers also. The only question is whether the middlemen namely Shri Ayodhya Prasad Semwal and Shamim Ahmad entered into an agreement with Shri Tajbar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... asset. The AO has held that the assessee offered it voluntarily, though the tone and tenor of his communications which have also been reproduced by the AO in his submission, has played no small measure In that, because even as he offered the proceeds for tax under capital gains, the assessee pleaded that it should not be considered unexplained investment. Be that as it may, an amount cannot be taxed because the assessee may offer it for tax at a particular point of time. It can only be brought to tax if it is legally due to be brought to tax and this brings us to an examination as to whether the profit on the sale of land at Village Shivrajpur Patti is liable for capital gains tax. I have examined the issue in the appeal for the assessment year 2010-11 and in that year I have held:- Finally, with regard to the computation of capital gain on account of sale of plots at vii/age Shivrajpur Patti, and the submission of the A.O. that the same was taxed on account of the request of the assessee to treat as capital gains and the fact that plotting was done, it is seen the land sold as plots was part of the agricultural land of 8 bighas that was transferred and that Shivrajpur Patti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sanjeeda Begum (2006) 154 Taxaman 346 (All.) had occasion to consider a similar case. In that case the assessee sold part of the land measuring 2888 Sq. Yards during the Assessment Year in question to 12 different persons after dividing the lands into plots, each plot having an area of about 200 Sq. Yards and the colony having been named Shiv Vihar Colony. The assessee's claim that the land was agricultural land, was also situated outside the municipal limits and it was not covered by the Notification of the Govt. of India issued under section 2(14)(iii)(b) of the of the I. T. Act, 1961 and therefore, no capital gains were applicable. However, the Assessing Authority did not accept the plea as the land was under regulated area of Saharanpur for which the Addl. Disti. Magistrate had fixed a circle rate and it was situated near to Saharanpur City and was in the proximity of building and building sites. He took the view that agricultural land had been converted into non-agricultural land before the date of agreement to sell and therefore the provisions regarding capital gains were attracted. In appeal the AAC, Dehradun accepted the plea of the assessee after he came to the conclu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rom the authorities and in the absence of any permission being obtained by the assessee from PUDA authorities in respect of the land sold, merely because the land is sold in smaller plots to persons, who intended its residential use, does not change the nature of land sold in the hands of the assessee, and it's taxability. A similar issue was considered by the Hon'ble Chandigarh Bench of ITAT in the case of Wealth Tax Officer Vs. Sukhpal Singh (1989) 42 Taxman 119 (CHD). In the said case, the assessee had claimed that certain land owned by him was agricultural land for the purpose of computing his net wealth. The records showed that as long as assessee remained the owner of the land he did not use the land for any non agricultural purposes, although he carved and sold out the plots out of it and had made provision for approach roads as per outlay which had been seized during search of his premises. The Hon'ble ITA T held that land being agricultural in first instance and the use of land not having been actually changed by the assessee it should be held to be agricultural land in his hands. It further observed that the purchaser intended ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
