Principal Commissioner Of Income Tax -7 v. Jyotiben G Vaghela

C/TAXAP/469/2018 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/TAX APPEAL NO. 469 of 2018 FOR APPROVAL AND SIGNATURE: HONOURABLE MR.JUSTICE M.R. SHAH sd/-andHONOURABLE MR.JUSTICE A.Y. KOGJE sd/-=========================================1 Whether Reporters of Local Papers may be allowed to see NOthe judgment ?2 To be referred to the Reporter or not ?NO3 Whether their Lordships wish to see the fair copy of the NOjudgment ?4 Whether this case involves a substantial question of law as NOto the interpretation of the Constitution of India or any order made thereunder ? =============================================PRINCIPAL COMMISSIONER OF INCOME TAX -7 VersusJYOTIBEN G VAGHELA =============================================Appearance: MRS MAUNA M BHATT(174) for the PETITIONER(s) No. 1 for the RESPONDENT(s) No. 1 =============================================CORAM: HONOURABLE MR.JUSTICE M.R. SHAH and HONOURABLE MR.JUSTICE A.Y. KOGJE Date : 04/07/2018ORAL JUDGMENT (PER : HONOURABLE MR.JUSTICE M.R. SHAH) 1.0. Feeling aggrieved and dissatisfied with the impugned judgment and order passed by the learned Income Tax Appellate Tribunal, Ahmedabad "A" Bench, Ahmedabad dated 16.11.2017 passed in IT(SS) A. No.122/AHD/2014 for AY 2011-12, by which, the learned Tribunal has dismissed the said appeal preferred by the Revenue and has confirmed the order passed by the learned CIT(A) deleting the addition of Rs.1,30,99,900/- being unexplained expenditure under Section 69 A of the Income Tax Act and deleting the addition of Rs.5,70,000/- made on account of Short Term Capital Gain, the Revenue has preferred the present appeal with the following proposed questions of law. "A. Whether the Appellate Tribunal has erred in law and on facts in deleting the addition of Rs.1,30,99,900/- being unexplained expenditure u/s 69 A of the Act ? B.Whether the Appellate Tribunal has erred in law and on facts in deleting the addition of Rs.5,70,000/- made on account of STCG ?" 2.0.The facts leading to the present Tax Appeal in nutshell are as under: 2.1.That the assessee filed return of income for AY 2011-12. During the course of assessment proceedings, it was found by the AO that the sale consideration for agricultural land sold during the period relevant to AY 2011-12 was wrongly shown at Rs.5,70,000/- and according to the AO, on the basis of statement of the purchaser of the land and additional cash payment of Rs.1,30,00,000/-was made. Therefore, the AP taxed the disclosed profit by way of short term capital gain tax and added the undisclosed sum under Section 69 A of the Act. Consequently, the assessment order under Section 143(3) r/w Section 153B(1)(b) of the Act was passed making the addition of Rs.1,36,69,900/- on the following issues: (i) u/s 69 A of the Act Rs. 1,30,99,900/- (ii) on account of STCG Rs. 5,70,000/- 2.2.Against the aforesaid addition, assessee preferred appeal before the learned CIT(A). The learned CIT(A) deleted the aforesaid additions made under Section 69 A of the Act as well as on account of STCG. In appeal before the learned Tribunal at the instance of the Revenue, the learned Tribunal by impugned order has dismissed the said appeal, which has given rise to the present appeal at the instance of the respondent. (ii) on account of STCG Rs. 5,70,000/- 2.2.Against the aforesaid addition, assessee preferred appeal before the learned CIT(A). The learned CIT(A) deleted the aforesaid additions made under Section 69 A of the Act as well as on account of STCG. In appeal before the learned Tribunal at the instance of the Revenue, the learned Tribunal by impugned order has dismissed the said appeal, which has given rise to the present appeal at the instance of the respondent. 3.0.We have heard Mrs. Bhatt, learned counsel for the revenue. So far as the addition made by the AO of Rs.1,30,99,900/- added as undisclosed sum under Section 69 A of the Act is concerned, it is required to be noted that the same was solely based on the statement of purchaser which was not binding on the assessee, more particularly, when he was not offered for cross examination. The aforesaid is not disputed by the learned counsel for the Revenue. Under the circumstances, both the learned CIT(A) as well as learned ITAT have rightly deleted the addition made under Section 69 A of the Act. 4.0.Now, so far as the deletion of addition made by the AO on account of STCG is concerned, it is required to be that the land was situated beyond 8 km from any Urban Agglomeration. The assessee produced certificate of Talati cum Mantri of the village in support of his contention. The aforesaid had gone uncontroverted and therefore, learned CIT(A) as well as learned ITAT deleted the addition made on account of STCG. For this Court it was submitted that earlier that as the said contention was raised for the first time before learned CIT(A) and the learned CIT(A) accepted the same without verification, the learned CIT(A) should have called for report from the AO, which he did not do so. Recording the aforesaid submission, Division Bench of this Court while adjourning the matter to today observing that "Assessing Officer, in the present case, verify the facts and in particular, in the context of the Certificate of Talati-cum- mantri produced by the assessee. He may file additional statement on the basis of such exercise, why he may undertake". Today, when the present appeal is taken up for further hearing, Mrs. Bhatt, learned counsel for the Revenue has in fact confirmed the earlier certificate issued by the Talati-cum-mantri that the land in question was situated beyond 8 km from any Urban Agglomeration which was relied by the assessee before the leaned CIT(A). In that view of the matter, now the grievance of the revenue does not survive. Once it was found that the agricultural land was situated beyond 8 km from any Urban Agglomeration, the addition made on account of STCG was not permissible and sustainable. 5.0.In view of the above, it cannot be said that the learned ITAT has committed any error in deleting the addition made by the AO under Section 69 A of the Act as well as on account of STCG. No substantial question of law arise. Under the circumstances, present appeal deserves to be dismissed and is accordingly dismissed. sd/-(M.R. SHAH, J) KAUSHIK J. RATHOD sd/-(A.Y. KOGJE, J)