TaxTMI 
TaxTMI 
TaxTMI 
2016 (9) TMI 1195
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....Tax Act ("the Act" for short). During such assessment, the assessee was confronted with the sale transaction of the agricultural land and the question of capital gain arising from such sale. The assessee contended that the agricultural land which he inherited was sold on 10.6.2008 but the stamp paper was purchased on 31.3.2008 and in fact, the transaction falls within the assessment year 20092010. He also relied on a certificate from one Shri K.B. Patel to contend that the land was situated beyond a distance of 8 kms. from the limit of Vadodara Municipal Corporation. Hanumanpura has a population of about 10,000. Accordingly, the said lands would be covered by the exclusion provided in section 2(14) of the Act and would therefore, be exempt from the payment of capital gain. 3. The Assessing Officer passed the order of assessment on 23.1.2013. He rejected the assessee's first contention of sale falling outside the year under consideration but accepted the second contention of the land being beyond a distance of 8 kms from the limit of Vadodara Municipal Corporation by accepting the certificate produced by the petitioner stated to have been issued by Shri K.D. Patel Executive Eng....
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....at he has received cash onmoney of Rs. 1,05,72,000/on the sale of land and secondly statement on oath of Additional Assistant Engineer, Vadodara Municipal Corporation, Baroda, it is proved that assessee has not disclosed complete and true facts to the Assessing Officer in original assessment proceedings. Moreover, fresh material is also on record which negates the incorrect evidence submitted by assessee regarding distance of land. Under the above said facts, I have reason to believe that the assessee has not disclosed Rs. 1,05,72,000/as cash sale consideration of the land and Rs, 1,10,70,000/has escaped assessment as capital gain receipts. Hence, there has been failure on the part of the assessee to disclose fully and truly all material facts necessary for assessment for AY 200809. The notice u/s 148 of the IT Act for AY 200809 is required to be issued for initiation of reassessment proceedings of capital gain to the extent of Rs. 1,10,70,000/which has escaped assessment." 5. The petitioner raised objections under his communication dated 12.12.2015. He followed the same with subsequent objections. Grievance of the petitioner is that such objections were not disposed of and in th....
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....68 which is stated in the said banakhat. It is further stated in the said banakhat that remaining amount would be paid at the time of execution of sale deed. Copy of banakhat is enclosed herewith. As per this banakhat, appellant was to receive Rs. 1,10,70,000/as sale consideration for sale of the said agricultural lands. Accordingly, purchasers i.e. Shri Kamlesh Natubhai Patel purchased required stamps for executing registration deed on 31/03/2008. The registration documents have been made for a sale consideration of Rs. 4,98,000/which has been paid entirely by cheques on several dates appearing in the registration documents which were registered before the Subregistrar Vaghodia on 10th June, 2008. Copy of registered sale deed for Rs. 4,98,000/is enclosed herewith. Shri Kamlesh Natubhai Patel issued several cheques of Rs. 1,04,17,000/from State Bank Of Mysore as security towards amount remained to be paid as per banakhat and not reflected in the registered sale deed. The said cheques were not presented by appellant in the bank as per mutual understanding with Shri Kamlesh Natubhai Patel. Shri Kamlesh Natubhai Patel handed over cash on various dates as per the terms of banakhat in ....
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....ext during the scrutiny assessment, the assessee had relied on a certificate stated to have been issued by the competent authority indicating that the land was situated beyond 8 kms from Vadodara Municipal Corporation limits. In this context, the reasons recorded suggest that subsequently statement of Shri Sohan M. Patel, Additional Assistant Engineer, Vadodara Municipal Corporation was recorded on oath on 10.7.2013 who stated that the land in question is situated not more than 2 kms from the outer limit of Vadodara Municipal Corporation. The Assessing Officer therefore, formed a belief that the land falls within the exclusion clause and capital gain arising out of such asset would be chargeable to tax. The assessee would also have to account for the undisclosed sale consideration of Rs. 1.05 crores. He recorded that fresh material was found which proves that the evidence submitted by the assessee regarding the distance of land was incorrect. In his opinion, therefore, on the total sale consideration of Rs. 1.10 crores, the assessee would have to pay the capital gain. 8. In this petition, counsel for the petitioner raised the following contentions : 1) That the Assessing Officer....
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.... Supreme Court in case of GKN Driveshafts (India) Ltd. v. Incometax officer and others reported in 259 ITR 19, the Assessing Officer ought to have disposed of the objections. Ordinarily, we would have insisted on Assessing Officer doing so. However, facts in the present case are somewhat peculiar and no useful purpose would be served in ensuring only cosmetic purpose of completion of formality and then inviting a fresh litigation. Under the circumstances, we have examined the merits of the petitioner's challenge to the reopening also. 11. As noted, the Assessing Officer pressed in service two grounds which according to him were not on record during the original assessment. One is the undisclosed sale consideration of Rs. 1.05 crores received by the petitioner for the sale of land in question. It has now come on record through the petitioner's own admission that though the sale deed recorded sale consideration of Rs. 4.98 lacs, the petitioner received additional sum of Rs. 1.05 crores in cash. The purchaser had given cheques by way of security which were however, not deposited with the bank upon the matching sum in cash being paid to the petitioner. 12. Central question of....
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....ndia or were there later notifications either expanding the boundaries or refixing the distances, depend on the development of various urban agglomeration, is also not clear on record. We may therefore, for prima facie consideration, accept the stand of the Revenue that it would be the outer limit which would be relevant for ascertaining the distance. It is well settled at the stage of reopening of assessment the Assessing Officer must have reason to believe that income has escaped assessment. The reason to believe cannot be equated with final proof. 15. Coming to the central issue of distance being less or more than 8 kms between the outer limits of Vadodara Municipal Corporation and land in question, we notice that during the previous assessment, the petitioner had relied on a certificate stated to have been issued by one Shri K.D. Patel, Executive Engineer, Road and Building division, District Vadodara, on 16.1.2013 in which it was stated that the distance between the limit of Vadodara Municipal Corporation and the Hanumanpura village is more than 8 kms. 16. Incometax authorities however, later on obtained a certificate dated 12.7.2013 from Deputy Municipal Commissioner, Vadod....
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.... issued by the Executive Engineer, Road and Building Department, Vadodara, in which, it is stated that the distance between the outer limit of Vadodara Municipal Corporation and Hanumanpura bus stand is 2.8 kms. The incometax authorities also have a certificate dated 12.07.2013 issued by Deputy Municipal Commissioner, Vadodara Municipal Corporation, in which it is stated that the shortest aerial distance between the survey numbers in question ranges between 0.434 kms to 1.708 kms. 3. The later certificate referred to above, raise a serious doubt about the veracity of the first certificate dated 16.01.2013 issued by the Executive Engineer Shri K.D.Patel. If the aerial distance between the plot of land and the outer limit of Vadodara Municipal Corporation is barely a half km., it seems very unlikely that a distance by road between the Vadodara Municipal Corporation limits and the village in question would exceed 8 kms. We would therefore like to ascertain correct facts. 4. Let the petitioner join the Secretary, Road and Building Division, Government of Gujarat, as an additional respondent. 5. Let there be NOTICE to the newly added respondent, returnable on 31.08.2016. On the sa....
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....submitted to Treasury office, Vadodara for verification of signature.) 11. I say and submit that even Mr. K.D. Patel has denied issue of any such certificate. (Attached herewith and marked as AnnexureR5 is affidavit by Mr. K.D. Patel)." 19. Along with this affidavit, the deponent has also produced several documents including the affidavit of Shri K.D. Patel dated 8.9.2016 stating that he had never issued certificate dated 16.1.2013 and the document does not carry his signature. 20. It can thus be seen that there is serious doubt about genuineness of the certificate dated 16.1.2013 of the Executive Engineer certifying that the land in question was situated beyond 8 kms from the outer limit of Vadodara Municipal Corporation, upon which the petitioner heavily relied. Shri K.D. Patel who is supposed to be the author of the certificate has since retired from Government service but has filed an affidavit stating that he has never issued the said certificate and the document does not carry his signature. The Road and Building division contends that a copy of said certificate is not found in their official records. A strong case is built up against the petitioner of having produced a d....