TMI Blog2018 (1) TMI 10X X X X Extracts X X X X X X X X Extracts X X X X ..... hall co-operate in the fresh proceedings before the AO. All pleas available under the law shall remain so available to the assessee. - I.T.A No. 301/Agra/2016 - - - Dated:- 21-11-2017 - Shri A. D. Jain, Judicial Member Assessee by : Shri R. C. Tomar, AR Revenue by : Shri Waseem Arshad, Sr.DR. ORDER This is assessee s appeal for assessment year 2007-08, raising the following grounds: 1. The learned CIT(A)-I, Agra has erred in law and on facts in holding the re-opening of the case u/s 147 as valid without appreciating the fact that the AO has not disposed off the objections of the appellant and he passed the assessment order ignoring the principles laid down by the Hon'ble Supreme Court in the case of GKN Driveshafts (India) Ltd. Vs ITO (2003) 259 ITR 19 (SC) and I.O.T. Infrastructure Energy Services Ltd vs. ACIT (2010) 233 CTR 175 (Bom). 2. That the learned CIT (A)-l, Agra has erred in law and on facts in confirming the addition of ₹ 4,91,126/- on account of long term capital without appreciating:- a) Clause (v) of sub-section 47 of section 2 i.e. any transaction involving the allowing of the possession of any immovable property to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eed dated 21.04.2006, for a total sum of ₹ 4,25,000/- being sale consideration whereas for stamp duty purpose the value by the registrar has been taken at ₹ 13,57,492/-, thus as a result of transfer of capital asset there does arise capital gains in terms of provisions of section 50C of the Act, and the seller has not ever filed his return of income though the capital gains is chargeable to tax. In view of the above facts I have reasons to believe that capital gain chargeable to tax has escaped assessment at least to the tune of ₹ 9,32,492/- and to assess it in the hands of the assessee by invoking the provisions of section 147 of the Act, issuance of notice u/s 148 is considered necessary. 4. The assessee filed the following objections dated 17.12.2014 before the AO (APB 92-96): To The Income tax Officer-3(4) Room no. 210, Radhika Vihar, Mathura. Sir, Sub:- Compliance of notice under section Income tax Act 1961 in the case Smt. Suman Agarwal w/o Kanhiya Lal Agarwal, (Govind Nagar, Mathura) r/o A-199 Kamla Nagar, Agra- Asstt. Year 2007-08-Regarding- Please refer to your notices u/s 143(2) and u/s 142(1) dated 07/10/2014 and 1. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (c) The AO has not applied his mind while issuing notice u/s 148 dated 28/3/2014 which is clear from a perusal of the same. The AO has not strike off inapplicable words viz. assess/reassess the income/re-compute loss/depreciation. Similarly, the notice shows this notice is being issue after obtaining the necessary satisfaction of the Addl. Commissioner/Commissioner/Chief Commissioner of Income tax/The Central Board of Direct Taxes. (d) A perusal of the reasons recorded shows that the AO has not applied his mind while recording the reasons in as much he worked out the escapement of income at ₹ 9,32,492/- treating the assessee as sole owner of the land in question while there are two co-owners and the AO has not initiated proceedings u/s 147/148 against the other co-owner for the reasons best known to him. Hence, the notice issued u/s 148 is illegal, invalid and baseless as there is no application of mind. Vide petition under section 6 of RTI Act, 2005 the AO was requested to furnish following information: Have you initiated action under section 147 of Income tax Act, 1961 in the case of Smt. Krishna Anand w/o Sri Dinesh Kumar co-owner for the assessment year ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... It has been stated by you that sale deed executed on 21.4.2006 was for amount of ₹ 4,30,000/-. It is wrong to say that the sale deed dated 21.4.2006 was for amount of ₹ 4,30,000/-. A perusal of the starting first para of first page of sale deed clearly shows that 4,25,000/-. Similarly at page 8 it has been mentioned. Va Avaj 4,25,000/- Rupaya Char Lakh Pachchees Hajar Rupaya Jiske Aadhe 2,12,500/- Rupaya Do Lakh Barah Hazar Panch Sau Rupaya Hote Hai. It is, therefore, clear that sale deed was executed for ₹ 4,25,000/-. At page 9 the receipt of ₹ 15.000/- is a typographical error which is ₹ 10,000/-. d) With regard to the possession of land you recorded the statement of power attorney holder at the back of the assessee. The uncertified copy of the statement supplied to the assessee shows that he is broker and deals in purchase and sale of immovable properties on commission basis. A perusal of the same shows that the broker stated in his statement that MALIKANA HAK 21.4.2006 KO HI DIYA GAYA HAI . MALIKANA HAK means registered ownership. The registered ownership i.e. MALIKANA HAK will naturally pass when sale deed is executed in somebody favour. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... possession of the property or any part thereof, or the transferee, being already in possession, continues in possession of the contract and has done some act in furtherance of the contract, and the transferee has performed or is wilting to perform his part of the contract, then notwithstanding that where there is an instrument of transfer, that the transfer has not been completed in the manner prescribed therefore by the law for the time being in force, the transferor or any person claiming under him shall be debarred from enforcing against the transferee and persons claiming under him any right in respect of the property of which the transferee has taken or continued in possession, other than a right expressly provided by the terms of the contract: Normally transfer of an immovable property worth ₹ 100/- or more is not complete without execution and registration of a conveyance deed. However, section 53A of the Transfer of Property Act envisages situations where under a contract for transfer of an immovable property, the purchaser has paid the price and has taken possession of the property, but the conveyance is either not executed or if executed it is not registered. In su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... owner contracted to transfer a plot of land for consideration as per agreement dated 21.8.2003; ii) It is in writing through agreement dated 21.8.2003. iii) It is i.e. agreement is signed by the transferors pertains to the transfer of land i.e. immovable property which is mentioned in the agreement dated 21.8,2003. iv). The transferee was allowed possession of land on the date of agreement as the assessee received almost full amount of consideration. A power of attorney was also executed by the assessee and his co-owner in favour of third party i.e. Sri Anil Kumar Kaushik on the instructions of the transferee. v) That the transferee was willing to perform his part contract which is clear from the fact that he made payment of consideration to the extent of 98% and got power of attorney executed in favour of third party and ultimately sale deed executed on 21.4.2006 through power of attorney holder in favour of transferee. Hence, the transaction in question clearly falls in the year 2003-04 as the same is covered with the provisions of section 2(47(v) of Income tax Act, 1961. It may, however, be submitted that It is common knowledge when a person gives f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elieve that any income chargeable to tax has escaped assessment for any assessment year, has been empowered, subject to the provisions of sections 148 to 153, to assess or reassess such income and also any other income chargeable to tax which has escaped assessment and which comes to his notice subsequently in the course of the proceedings under section 147, or to re-compute the loss or the depreciation allowance or any other allowance, as the case may be, for the relevant assessment year. Further as per the explanation of section 148(1), the terms specified under proviso (a) and (b) to serve notice are not applicable in the case the return has been furnished on or after 1st day of October, 2005 . and: Further as per the Supreme court ruling in the case of ACIT v/s Rajesh Jhaveri Stock Brokers Pvt. Ltd., if the Assessing Officer has reason to believe that any income chargeable to tax has escaped assessment for any assessment year, he may, subject to the provisions of sections 148 to 153, assess or reassess such income and also any other income chargeable to tax which has escaped assessment and which comes to his notice subsequently in the course of the proce ..... X X X X Extracts X X X X X X X X Extracts X X X X
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