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2019 (7) TMI 656

liable and ambiguous. Indeed it does not qualify as a certificate from the tehsildar. - Rule 46A of IT Rules - Rule 29 of Appellate Tribunal Rules - said evidence is liable to be admitted in the facts and circumstances of the case, or not so - HELD THAT:- Where therefore the appellate court considers that such an additional evidence would be necessary for proper adjudication of the matter, i.e., where it cannot, in the absence of the said evidence, pronounce a judgment satisfactorily, it is to invoke its’ discretion even if the evidence being furnished before it is for the first time, and there has been no denial of opportunity by the authority below (i.e., before whom it ought to have been furnished) for adducing the said evidence. This, then, explains the law in the matter. It is, in view of the fore-going, not considered necessary for pronouncing the judgment satisfactorily to admit the ‘certificate from the Tehsildar’, sought to be admitted as additional evidence. The said certificate is both unreliable and ambiguous. Indeed it does not qualify as a certificate from the tehsildar. There is nothing on record, or sought to be admitted, that the prescribed distan .....

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is an Appeal by the Assessee directed against the order by the Commissioner of Income Tax (Appeals)-2, Jalandhar ( CIT(A) for short) dated 19.9.2017, dismissing the assessee s appeal contesting his assessment u/s. 144 read with section 147 of the Income Tax Act, 1961 ('the Act' hereinafter) dated 13.12.2016 for the Assessment Year (AY) 2009-10. The background facts 2. The brief facts of the case are that the assessee, who did not return any income by way of capital gain for the relevant year, was, on the basis of the information in the possession of the Revenue, found to have sold land (measuring 23 Kanals, 11.5 Marlas), agricultural in nature, falling within the municipal limits (of Goraya) during the relevant year and, accordingly, income by way of capital gains - the land having been sold for a consideration of ₹ 103.16 lacs to a real estate company, brought to tax u/s. 2(24)(vi) r/w s. 45 of the Act by the Assessing Officer (AO). In appeal, the assessee sought consideration of the additional evidence by way of a report from the Tehsildar, which was not admitted by the ld. CIT(A) in-as-much as the assessee could not show that he was prevented by sufficient cause i .....

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unsel below the index to the paper-book is thus wrong. This, however, would not materially alter the assessee s case. It may here also be clarified that PB pgs. 37-39 contain the assessee s return of income for the relevant year, filed on 13.01.2017, i.e., just prior to preferring the appeal before the first appellate authority on 14.01.2017. The same is without any basis in law and, to no consequence. As it appears, it stands filed to signify the admission of a part of the capital gains, as assessed, i.e., on, as stated, relatable to 7K 10M of land, paying tax thereon. 3.2 Our second observation in the matter is that the principal issue involved in the instant case, and for which we have also referred to the grounds raised by the assessee, is, as stated, the admissibility of the additional evidence at the appellate stage, denied by the ld. CIT(A) for being not in terms of rule 46A of the Rules, mandatory in character. This is as, de hors the same, the subject land sold by the assessee during the year is, on the basis of the material on record, in law not an agricultural land, i.e., is a capital asset, capital gains on the transfer of which is liable to tax as income. Per the said .....

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ause to allow its admission at the appellate stage, especially when the evidence was available to the party at the initial stage and had not been produced by him. In CIT v. Text Hundred India Pvt. Ltd. [2013] 351 ITR 57 (Del), the law stands reiterated, again with reference to judicial precedents. Where some inherent lacunae or defect becomes apparent to the appellate court, coming in the way of pronouncing the judgment, it held, the expression to enable it to pronounce the judgment can be invoked. Reference to pronouncing the judgment, it was explained, is not for pronouncing it in a particular way, but is to pronounce it satisfactorily to the mind of the court delivering it. The provision does not apply where with the existing evidence on record, the appellate court could pronounce a judgment satisfactorily. That is, the requirement of the court to enable it to pronounce a judgment does not refer to pronouncement of judgment one way or the other, but is only to the extent whether satisfactory pronouncing of the judgment on the basis of the material on record is possible. In sum, where therefore the appellate court considers that such an additional evidence would be necessary for .....

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). In fact, even so, the certificate produced for admission before the first appellate authority being conspicuous by its absence, it is only the report dated 01/11/2017, admission of which u/r. 29 arises for consideration. B. Qua r. 29 of the Appellate Tribunal Rules, the first reason that informs our decision is that the Tehsildar s report dated 01.11.2017 is unsigned by the Naib- Tehsildar, to whom the application by the assessee (dated 30/10/2017) is addressed. How could, then, it be said to be a (true copy of the) certificate or report by the said authority. The application by the assessee is not receipted by the said office. That apart, the application is not marked by the Tehsildar to the Area Patwari, as requested in the assessee s application. This would be even otherwise necessary as it is only when so marked, that the latter is enabled to make his comments on the subject matter of the report. Further, the report, by hand, appears to be signed by one Naya Ram , whose capacity is not clear. Needless to add, the report does not bear any stamp or the number by the office of the Naib Tehsildar, so as to regard it as an official communication by the said office. C. The report .....

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land, i.e., the entire of it, as falling within the municipal limits, as stated in the sale deed itself. And, in any case, of being one, contiguous land, transferred at a rate applicable to an urban or, in any case, a non-agricultural land. There is nothing to show that the assessee or the buyer has, either at the time of registration or at any time later, raised any objection with regard to the levy of stamp duty at a higher rate, i.e., qua the land claimed to be agricultural in nature. F. The evidence being sought to be admitted does not come in the way of pronouncing a judgment satisfactorily. Toward this, it may be relevant to begin by reproducing the relevant provision, defining a capital asset: Definitions. S. 2 In this Act, unless the context otherwise requires,- (14) Capital assets means- (a) property of any kind held by an assessee, whether or not connected with his business or profession; (b) any security held by …., - but does not include - (i) …. (ii) … (iii) agricultural land in India, not being land situate- (a) in any area which is comprised within the jurisdiction of a municipality (whether known as a municipality, municipal corporation, notifi .....

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- the distance prescribed varying with the population, it is not to be regarded as an agricultural land under the Act. It does not mean that a land falling outside the said limit has to be necessarily, i.e., irrespective of anything else, regarded as an agricultural land, i.e., as not a capital asset. The reverse, however, is valid - in view of the legal mandate, an agricultural land falling within the said limit has necessarily to be regarded as non-agricultural, a capital asset. It is thus only where the status of the subject land depends, irrespective of any other consideration, including the surrounding circumstances, exclusively on the said distance, that the admission of the evidence by the assessee may become liable to be admitted in pursuance of r. 46A(4) of the Rules or r. 29 of the Appellate Tribunal Rules. In the facts of the instant case the entire land is sold as one, contiguous piece of land, i.e., sold as part of the same transaction (i.e., comprised in one sale deed); to the same buyer (M/s. T. M. S. Real Estate (P.) Ltd., Phagwara); at the same rate; for the same purpose, which appears to be the development of real estate. And, in any case, going by the sale rate, .....

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. It would without doubt, we may hasten to add, be a different matter if land bought and sold for agricultural purposes, is subsequently, for some reason, not put to agriculture purposes. The stamp duty borne by the transaction is with reference to the collector rate and, further, at the rate as applicable to an urban land, clearly signifying it to be regarded as so by both the parties as well as the registering authority. Both the collector rate as well as the stamp duty rate are significantly lower for agricultural land, clearly suggesting that what was being conveyed was, besides the stated location as within the municipal limits - sought to be disputed by the assessee in the instant proceedings, for all intents and purposes, an urban land, sold for being developed into a real estate by a company in the said business. Reference here is made to the decision by the Apex Court in Sarifa Bibi Mohamed Ibraham & Ors. v. CIT [1993] 204 ITR 631 (SC). In the said decision the Apex Court emphasized the need to have regard of the entirety of facts and circumstances of the case in arriving at a decision one way or the other; it finding the circumstances, as obtaining in that case, again .....

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tand point of the truth of its contents, finding it to be of no consequence. Conclusion 4. In our view, therefore, the assessment stands satisfactorily concluded on the basis of the material on record and, accordingly, the assessee s plea for admission of additional evidence is liable to be rejected. We decide accordingly. It may appear from the manner in which the instant order has proceeded that we have not had regard to the decisions cited at bar by the parties. This is not so. We have carefully perused all these decisions; the decision in each case turning on its facts and circumstances. In Tek Ram (supra), the Apex Court states, albeit succinctly, all that has been expressed in Velji Deoraj & Co. v. CIT (supra) and Text Hundred India Pvt. Ltd. (supra), being themselves based on several decisions, mostly by the Apex Court itself. In Tek Ram (supra), the Hon ble Court was of the view that a satisfactory pronouncement of the judgment required the perusal of the documents produced by the appellant and, accordingly, set aside the matter back to the Hon ble High Court for the purpose. This is precisely what has been explained to be the law in the matter (refer para 3.3 of this o .....

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cases, as in Jawahar Lal Jain (HUF) v. CIT [2015] 370 ITR 712 (P&H); Jasbir Singh v. CIT (in ITA No. 84 of 2016 (O&M), dated 11.4.2016), upheld, in the facts and circumstances of the case, the denial of admission of additional evidence. The question, thus, in each case, turns on the facts and circumstances of the case, of course, having regard to the law in the matter. We cannot help observing that even as the assessee has rightly discerned the issue arising in the instant case, also making a prayer for admission of additional evidence u/r. 29 of the Appellate Tribunal Rules, he has not cited any decisions qua the said rule, and toward which we have, accordingly, relied on two, one recent - adverted to by the Bench during hearing, and another, a locus classicus in the matter, both rendered with reference to judicial precedents. Accordingly, neither the law in the matter is enumerated, nor is the question as to how it is met finds reference, in the said application. The said case law would thus not be of any assistance to the assessee in the facts and circumstances of his case. Another issue 5. The assessee has also raised a Ground (# 6) as to the non-grant of indexation be .....

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