Ita/61/2014 Of The Commissioner Of Income Tax v. Shri. Shaji Thomas

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT:- THE HONOURABLE MR.JUSTICE K.VINOD CHANDRAN & THE HONOURABLE MR. JUSTICE ASHOK MENON MONDAY, THE 16TH DAY OF JULY 2018 / 25TH ASHADHA, 1940 I.T.A.No.61 of 2014 --------------------------- AGAINST THE ORDER IN I.T.A.NO.132/COCH/2013 DATED 25.10.2013OF THE INCOME TAX APPELLATE TRIBUNAL, COCHIN BENCH, COCHIN ------------- APPELLANT(S)/ RESPONDENT/RESPONDENT/REVENUE:- ------------------------------------------------------------------------------------ THE COMMISSIONER OF INCOME TAX, THIRUVANANTHAPURAM. BY SENIOR COUNSEL, GOVERNMENT OF INDIA (TAXES) SRI.P.K.R.MENON, STANDING COUNSEL FOR GOVERNMENT OF INDIA (TAXES) SRI.JOSE JOSEPH. RESPONDENT(S)/RESPONDENT/APPELLANT/APPELLANT ASSESSEE: SHRI. SHAJI THOMAS, P XI-725A,MANJANKAL HOUSE, PATTOM, THIRUVANANTHAPURAM. BY ADVS. SRI.T.M.SREEDHARAN (SENIOR ADVOCATE)SRI.V.P.NARAYANANSMT.DIVYA RAVINDRAN THIS INCOME TAX APPEAL HAVING BEEN FINALLY HEARD ON 16-07-2018,THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:- I.T.A.NO.61 of 2014 APPENDIX APPELLANT'S ANNEXURES:- ------------------------------------------- ANNEXURE-A TRUE COPY OF THE ORDER OF THE ASSESSING OFFICER UNDER SECTION 143(3) DATED 30.12.2010.SECTION 143(3) DATED 30.12.2010. ANNEXURE-B TRUE COPY OF THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) DATED 13.02.2013.(APPEALS) DATED 13.02.2013. ANNEXURE-C TRUE COPY OF THE ORDER OF THE INCOME TAX APPELLATETRIBUNAL, DATED 25.10.2013.TRIBUNAL, DATED 25.10.2013. RESPONDENT'S ANNEXURES:- ---------------------------------------------- ANNEXURE-R1TRUE COPY OF THE CASH.CREDIT BILL NOS.286 DATED 4.4.2007 AND 19996 DATED 30.1.2007 ISSUED BY CHENGANNUR TALUK MARKETING AND PROCESSING CS LTD.4.4.2007 AND 19996 DATED 30.1.2007 ISSUED BY CHENGANNUR TALUK MARKETING AND PROCESSING CS LTD. ANNEXURE-R1(a)TRUE COPY OF INTIMATION NO.129/CIR.I(1)/TVM/10-11 DATED 28.6.2010 OF THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 1(1), TRIVANDRUM.DATED 28.6.2010 OF THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 1(1), TRIVANDRUM. ANNEXURE-R1(b)TRUE COPY OF NOTICE DATED 28.6.2010 ISSUED BY THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 1(1), TRIVANDRUM.ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 1(1), TRIVANDRUM. ANNEXURE-R1(c)TRUE COPY OF LETTER DATED 11.11.2010 SUBMITTED BYTHE ASSESSEE TO THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 1(1), TRIVANDRUM.THE ASSESSEE TO THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 1(1), TRIVANDRUM. ANNEXURE-R1(d)TRUE COPY OF NOTICE NO.R-1/CIR I(1)/10/-11 DATGED 11.11.2010 ISSUED BY THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 1(1), TRIVANDRUM.ISSUED BY THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 1(1), TRIVANDRUM. ANNEXURE-R1(e)TRUE COPY OF LETTER DATED 19.11.2010 SUBMITTED BY THE ASSESSEE TO THE ASSISTANT COMMISSIONER OF INCOME TAX,CIRCLE 1(1), TRIVANDRUM.ASSESSEE TO THE ASSISTANT COMMISSIONER OF INCOME TAX,CIRCLE 1(1), TRIVANDRUM. ANNEXURE-R1(f)TRUE COPY OF LETTER DATED 24.11.2010 SUBMITTED BY THE ASSESSEE TO THE ASSISTANT COMMISSIONER OF INCOME TAX,CIRCLE 1(1), TRIVANDRUM.ASSESSEE TO THE ASSISTANT COMMISSIONER OF INCOME TAX,CIRCLE 1(1), TRIVANDRUM. ANNEXURE-R1(g)TRUE COPY OF NOTICE DATED 30.11.2010 ISSUED BY THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 1(1),TRIVANDRUM.ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 1(1),TRIVANDRUM. ANNEXURE-R1(h)TRUE COPY OF LETTER DATED 6.12.2010 SUBMITTED BY THE ASSESSEE TO THE ASSISTANT COMMISSIONER OF INCOME TAX,CIRCLE 1(1), TRIVANDRUM.ASSESSEE TO THE ASSISTANT COMMISSIONER OF INCOME TAX,CIRCLE 1(1), TRIVANDRUM. I.T.A.NO.61 of 2014- 2 - ANNEXURE-R1(i)TRUE COPY OF STATEMENT OF INCOME FOR THE ASSESSMENTYEAR 2008-09.YEAR 2008-09. ANNEXURE-R1(j)TRUE COPY OF STATEMENT OF AGRICULTURAL INCOME RECEIVED DURING 2007-08.RECEIVED DURING 2007-08. ANNEXURE-R1(g)TRUE COPY OF NOTICE DATED 30.11.2010 ISSUED BY THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 1(1),TRIVANDRUM.ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 1(1),TRIVANDRUM. ANNEXURE-R1(h)TRUE COPY OF LETTER DATED 6.12.2010 SUBMITTED BY THE ASSESSEE TO THE ASSISTANT COMMISSIONER OF INCOME TAX,CIRCLE 1(1), TRIVANDRUM.ASSESSEE TO THE ASSISTANT COMMISSIONER OF INCOME TAX,CIRCLE 1(1), TRIVANDRUM. I.T.A.NO.61 of 2014- 2 - ANNEXURE-R1(i)TRUE COPY OF STATEMENT OF INCOME FOR THE ASSESSMENTYEAR 2008-09.YEAR 2008-09. ANNEXURE-R1(j)TRUE COPY OF STATEMENT OF AGRICULTURAL INCOME RECEIVED DURING 2007-08.RECEIVED DURING 2007-08. ANNEXURE-R1(k)TRUE COPY OF TAX RECEIPT NOS.5988 AND 16 ISSUED BY THE VILLAGE OFFICER, KUMARAKOM ALONG WITH ITS ENGLISHTRANSLATION.VILLAGE OFFICER, KUMARAKOM ALONG WITH ITS ENGLISHTRANSLATION. ANNEXURE-R1(l)TRUE COPY OF CERTIFICATE NO.3860/10 DATED 14.09.2010 ISSUED BY THE VILLAGE OFFICER, KUMARAKOM ALONG WITH ITSENGLISH TRANSLATION.ISSUED BY THE VILLAGE OFFICER, KUMARAKOM ALONG WITH ITSENGLISH TRANSLATION. ANNEXURE-R1(m)TRUE COPY OF REPORT PASSED BY THE DISTRICT SUPERINTENDENT OF SURVEY AND LAND RECORDS, KOTTAYAMALONG WITH ITS ENGLISH TRANSLATION.SUPERINTENDENT OF SURVEY AND LAND RECORDS, KOTTAYAMALONG WITH ITS ENGLISH TRANSLATION. ANNEXURE-R1(n)TRUE COPY OF DEED OF CONVEYANCE DATED 5.2.2008 BETWEENSHAJI THOMAS AND INDO PACIFIC HOTELS LTD. AND ANOTHER.SHAJI THOMAS AND INDO PACIFIC HOTELS LTD. AND ANOTHER. ANNEXURE-R1(o)TRUE COPY OF THE DEED OF CONVEYANCE DATED 20.11.2006EXECUTED IN FAVOUR OF SHAJI THOMAS.EXECUTED IN FAVOUR OF SHAJI THOMAS. ANNEXURE-R1(p)TRUE COPY OF SURVEY MAP PREPARED BY SHRI D.RAJAN,LICENSED SURVEYOR.LICENSED SURVEYOR. ANNEXURE-R1(q)TRUE COPY OF THE POSSESSION CERTIFICATE ISSUED BY THE VILLAGE OFFICER, KUMARAKOM DATED 17.05.2007 FOR THE PROPERTY IN RE-SY.NOS.306/5 AND 1/5.VILLAGE OFFICER, KUMARAKOM DATED 17.05.2007 FOR THE PROPERTY IN RE-SY.NOS.306/5 AND 1/5. vku/-[ true copy ] K. Vinod Chandran & Ashok Menon, JJ. ------------------------------------------------------- I.T.A.No.61 of 2014 ------------------------------------------------------- Dated, this the 16[th] day of July, 2018JUDGMENT Vinod Chandran, J: The Revenue is in appeal from the order of the Tribunal, on the following questions of law: 1. Whether, on the facts and in the circumstances of thecase, the Tribunal is right in law in equating“water-logged area” with “backwaters” and is not theabove approach and the conclusion perverse andwrong?case, the Tribunal is right in law in equating“water-logged area” with “backwaters” and is not theabove approach and the conclusion perverse andwrong? 2. Whether, on the facts and in the circumstances of thecase, is not -case, is not - i) the very approach of the Tribunal equating ortreating waterlogged area with backwatersfactually and legally wrong?treating waterlogged area with backwatersfactually and legally wrong? ii) the Tribunal wrong to have equated the finding ofthe Assessing Officer that “33.13 ares as shown inthe revenue records as backwater (Kayal)” as “theimpugned land as water logged area: based onthe submission of the assessee?the Assessing Officer that “33.13 ares as shown inthe revenue records as backwater (Kayal)” as “theimpugned land as water logged area: based onthe submission of the assessee? iii) the Tribunal wrong to have held 3.13 ares (0.818acre) as water tank available in an agriculturalland and are not the above findings based onsubmissions and surmises, perverse?acre) as water tank available in an agriculturalland and are not the above findings based onsubmissions and surmises, perverse? ii) the Tribunal wrong to have equated the finding ofthe Assessing Officer that “33.13 ares as shown inthe revenue records as backwater (Kayal)” as “theimpugned land as water logged area: based onthe submission of the assessee?the Assessing Officer that “33.13 ares as shown inthe revenue records as backwater (Kayal)” as “theimpugned land as water logged area: based onthe submission of the assessee? iii) the Tribunal wrong to have held 3.13 ares (0.818acre) as water tank available in an agriculturalland and are not the above findings based onsubmissions and surmises, perverse?acre) as water tank available in an agriculturalland and are not the above findings based onsubmissions and surmises, perverse? 3.The Tribunal for the reasons stated in the groundsright in law and fact in holding that “that portion of theland cannot have different character from that of themain land” “same treatment has to be given” and arenot the findings tested in the light of the groundsraised perverse and illogical?right in law and fact in holding that “that portion of theland cannot have different character from that of themain land” “same treatment has to be given” and arenot the findings tested in the light of the groundsraised perverse and illogical? i) Did the assessee discharge the burden of proof; ii) Should not the Tribunal have put the assessee to proof? ii) Should not the Tribunal have put the assessee to proof? 2. The assessee sold 130.73 Ares of land, lyingcontiguously, but registered in the name of the assessee in twoThandapers as per the Transfer of Registry Rules. 97.60 Ares isregistered under one Thandaper and 33.13 Ares in anotherThandaper; the latter being backwaters [Kayal]. The AssessingOfficer found that 97.60 Ares of land was agricultural land.However with respect to 33.13 Ares, the finding was that it is awater-logged area, being comprised in the backwaters and,hence, there could be no classification as an agricultural land.Capital gains were sought to be assessed on that portion of land,which was held to be water-logged and part of backwaters. ITA.61 of 2014 3. The Tribunal found that the contention of theassessee that the Kayal portion was used for irrigating the otherportion was acceptable. It was found that the Kayal land hasacquired the character of a water tank, used for the irrigation ofthe other land. It is submitted by the learned Senior Counselappearing for the Revenue that the said finding was merely on thesubmission of the assessee and there was nothing to establishthe same. 4. We have to notice that the Assessing Officer hadaccepted the fact that 97.60 Ares of land sold by the assessee isagricultural land. In fact, the said finding was also on proof ofspecific agricultural operations having been undertaken in the saidland. The adjacent land which is lying as Kayal land andwater-logged, would only have made the adjacent land morefertile and admittedly it was not used for any other purpose. Theadjacent land remaining as water-logged and comprised withinthe backwaters, sold along with the agricultural land, could bedeemed to be only agricultural land. We are, hence, not inclinedto interfere with the orders of the Tribunal. We answer the ITA.61 of 2014 questions of law, which are more on facts, against the Revenue and in favour of the assessee. The appeal stands dismissed. No costs. Sd/-K.Vinod ChandranJudge vku/- Sd/- Ashok MenonJudge [ true copy ]