Law v. Income Tax Officer,Wherein Tnedivision Bencn Held Tnat The Contention Of The Revenue Tnat

IN THE HIGH COURT OF KARNATAKA AT BENGALURU|ON THE 14 DAY OF NOVEMBER, 2018 BEFORE THE HON BLE MR. JUSTICE RAVI MALIMATH| AND| THE HON'BLE MR. JUSTICE K. NATARAJAN) INCOME TAX APPEAL No.11 of ZJO1 BEI|WEE SHRI.H. HANUMANTHAPPA, No.224, 4 CROSS,T BLOCK,BASAVESHWARANAGAR,|4 STAGE,BANGALORE - 560 079, APPELLANT| (BY SRI A. SHANKAR & M. LAVA, ADVOCATES) AND THE INCOME-TAX OFFICER,WARD 8(3), 3 FLOOR, |JEEVAN SAMPIGE BUILDING,SAMPIGE ROAD, |MALLESHWARAM, BANGALORE - 560 OO3. .., RESPONDENT (BY SRI K.V. ARAVIND, ADVOCATE) THISINCOME|TAX.APPEAL|ISFILED|UNDERSECTION 260-A OF I.T.ACT, 1961 ARISING OUT OF ORDER|DATED 02-09-2010 PASSED IN ITA No.681/BANG/2010,.FOR THE ASSESSMENT YEAR 2004-05, PRAYING [TQFORMULATE THE SUBSTANTIAL QUESTIONS OF LAW.STATED THEREIN AND ALLOW THE APPEAL AND SET|ASIDE THE ORDER PASSED BY THE ITAT, BANGALORE IN |ITA No.681/BANG/2010, DATED OQ2-09-2010 TO THEEXTENT HELD AGAINST THE APPELLANT, IN THE INTEREST.OF JUSTICE AND EQUITY. THIS INCOME TJTAXK APPEAL COMING ON FHEARING THIS DAY, RAVI MALIMATH, J., DELIVERED THE.FOLLOWING: JUDGMENT The appellant is an individual deriving income fromcommission agency in vegetables. He was also aneagriculturistgrowingvegetablesananadCOCONUT|plantations. He filed his return of income as an individual|for the Assessment Year 2004-05 declaring total income of Rs.45,000/-. Subsequently, he filed a revised return ofincome under the head ‘income from other sources’ and|income from capital gains on the land acquired by)Bangalore Development Authority ( BDA’ for snort). He.claimed exemption under Section 54B of the Income Tax| Act, 1961 (Act’ for short). That the land was originally|purchased for a sum of Rs.1,61,055/-. He incurred an!amount of Rs.2,10,000/- as ‘improvement expenses Dy|drilling bore-well etc., Tne land was acquired by the BDA|for a sum of Rs.11,93,0/6/-. Thereafter, he computed|capital gains of Rs.4,60,204/- and claimed exemption|under Section 54B of the Act as ‘investment on agriculturalland. The Assessing Officer re-computed the total incomeand assessed the same at Rs.4,44,550/- as against the|declaration of income by the assessee as Rs.45,000/-.Aggrieved by the same, an appeal was filed before theCommissioner of Income Tax (Appeals)-II, Bangalore. The)appeal was partly allowed. The First Appellate Authority|directed the Assessing Officer to withdraw an amount of)Rs.3,00,000/- from the exemption claimed under Section.54B of tne Act, since the sale consideration has been paidafter filing of the return of income and partial relief was|granted insofar as the cost of improvement is concerned. |Aggrieved by the same, an appeal was preferred before| the Income Tax Appellate Tribunal (ITAT), Bangalore|Bench, Bangalore. Tne Appellate Tribunal partly allowed.the appeal. Aggrieved by the same, tne present appeal is |filed by the assessee., 2.|By the order dated 22.11.2011, the appeal wasadmitted to consider the following substantial question of law: “ Whether the finding of the Tribunal thatthere is no compliance of provisions ofSection 139(4) of the Act eventhough.reinvestment is made within three years:from the end of the financial years in which|the transaction took place on 6.8.2003, is'perverse and arbitrary? 3.Learned counsel for the appellant contends tnat thequestion of law is since covered by the judgment of thisCourt reported in)(2009) 32 DIR Juagments 243|in thecase of.Fathima Bali vs. Income Tax Officer,wherein tneDivision Bencn held tnat the contention of the Revenue tnat the deposit in the scheme should have been made beforethe initial due date and not the extended due date, was anuntenable contention. Therefore, the appeal was allowed infavour of the assessee. 4Under the circumstances, since the substantial|question of law is covered by the aforesaid judgment, tnesame is accordingly answered in favour of the assessee andagainst the Revenue. Consequently, the order of theTribunal is set aside. The appeal is accordingly disposedoff. SD/-JUDGE| SD/-|JUDGE mv|CT:AM