TaxTMI 
TaxTMI 
2020 (2) TMI 89
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....and on facts in deleting the addition of Rs. 77,86,500/- made by A.O. without appreciating the fact that the assessee has not objected before the Sub Registrar Authority and paid the stamp duty 3. We take first ground regarding deletion of addition of Rs. 1,60,09,128/- made by the AO under section 54B of the Act. 4. Brief facts of the case in this regard are that during the year under consideration the assessee has sold ancestral agriculture land admeasuring 10117 sq.meters situated at village Ambli together with other co-owners for a consideration of Rs. 5,35,00,000/- by registered sale deed dated 17.1.2014. The assessee was having 50% share in that property, which came to Rs. 2,67,50,000/- on which capital gain is liable for taxation. The assessee has sought deduction in respect of cost of improvement of Rs. 1,60,09,128/-. The Ld.AO sought explanation for this improvement cost from the assessee. The claim of the assessee was on two counts. Firstly, it was explained by the assessee that the expenditure incurred by the assessee was between 1982 to 1993 and the assessee being an agriculturist was not required to maintain books of accounts and other records and that too for a perio....
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.... submitted by the appellant is admitted as there was a reasonable cause for not producing the evidences before the A. O. and the same is considered necessary to go to the root of the controversy involved. Therefore, same are admitted for adjudication to provide natural justice to appellant and such admission is supported by following case laws: - Kamlaben S Bhatti 44 Taxman.com 459 (Guj.) Dharmamdev Finance Pvt Limited 43 taxman.com 395 (Guj.). - ACIT VS Jogindersingh (ITA No. 2942/DELHI/2011) ITAT, Delhi - Anmol Colour India Pvt. Ltd. Vs. ITO 31 SOT 18 (JP) 121 ITJ 269: ITAT, Jaipur. - CIT Vs. Khanpur Cool Syndicate (1964) 53 ITR 225 (SC): As far as facts of the case are concerned, the appellant had sold agricultural land and incurred expenditure on account of cost of improvement on agriculture land which was not accepted by the AO. The appellant could not furnish evidences of improvement for land which happen three decades ago. Therefore, valuation made by the registered valuer of the appellant showing the value of said agriculture land on 01/04/1981 at Rs. 10,11,600/- and improvement cost Rs..9,55,560/- in 1982 was not accepted by the AO. In response to such proposi....
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....erefore, sale deed was executed immediately after end of 'Kamurta' i.e. on 17th January, 2014 even though cheques cleared after execution of sale deed. The funds from the sale of original agricultural land have been utilized as can be seen from the date-wise investment into new agricultural land which is as under: Date of Cheque as per sale deed of Ambli land Cheque No Name of the buyer who paid the amount to the appellant Actual date of credit of cheques in the bank a/c Amount reed Date of Cheque as per purchase deed of Telav land Cheque No Name of the seller to whom "A' paid purchase consideration Actual date of debit of cheque in the bank a/c Amount Paid TDS u/s 194IA Chaturbhai Ambalal Patel 89167 30/09/13 131101 Januben 31/10/13 100000 TDS u/s 194IA Jay Chaturbhai Patel 89167 30/09/13 131102 Rafiyuddin 31/10/13 100000 TDS u/s 194IA Hinal Chaturbhai Patel 89170 30/09/13 131103 Husnaben 31/10/13 100000 20/11/13 298049 Jay Chaturbhai Patel 21/11/13 3300000 25/11/13 131107 Januben 27/11/13 3300000 20/11/13 337918 Chaturbhai Ambalal Pat....
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....regard Hon'ble Supreme Court in the case of Directorate of Enforcement vs Dipak Mahajan AIR 1994 (SC) 1775 has held that, it is permissible for the Courts to take into account the ostensible purpose or object and real legislative intent. A bare mechanical of the words devoid of concept of purpose will render the legislative intent inane. Further, the Hon'ble Apex Court has held that the Courts can by ascertaining legislative intent, place such construction on a statute as would advance its purpose and object. Where the words of statute are plain and unambiguous, effect must be given to them. The legislature may be safely presumed to have intended what the words plainly say. The plain words cam be departed from when reading then as they are leads to patent injustice, anomaly or absurdity or invalidation or a law [Bhaiji vs Sub-Divisional Officer (2003) 1 SCC 692, 700]. Also, the Hon'ble Gujarat High Court has held that, departure from the words or the rule is legitimate only in such cases where literal construction may result in depriving certain existing works of all meaning or to avoid any part of the statute becoming meaningless or otiose. The Hon'ble Supreme Cour....
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....claim u/s.546, was submitted by the appellant. The fund flow analysis in chart above compounded with explanation by the appellant, clearly show the case for the appellant as the conditions for deduction u/s.54B, in my opinion, have been fulfilled. In other words, following points emerge from the discussion above: a) As per fund-flow analysis indicated in chart above, the funds arising from the sale of original agricultural land have been utilized to purchase the new agricultural land. Once has to see the substance of the matter and real character of the transaction as have been held in various case laws. b) The customs and traditions contained in the explanation by the appellant, is reality prevailing in rural economy which cannot be ignored in the decision making. c) Appellant's contention that the AO has not adversely commented on the fulfillment of conditions to avail benefit u/s.54B, is found to be correct. It is noticed that the AO has more emphasized on the ratio in the case of Goetz (India) Ltd. vs. CIT 284 ITR 323 (SC) to deny the benefit on technical ground. Having held that the appellant has complied with the conditions to avail the benefit u/s.54B, now I come....
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.... Construction & Industries Ltd. vs. ACIT in ITA No. 2486-2488/Ahd/2003 (Ahmedabad Bench A) I have carefully gone through the case laws (supra) and feel that the appellate * authorities have full power to entertain the claim which is valid in law and which was not even made before the AO as per ratio laid down by Hon'ble Bombay High Court's decision in the case of Pruthvi Brokers and Shareholders 349 ITR 336. The head note of the above judgement is reproduced hereunder for the sake of clarity: - "Section 251, read with section 254, of the Income-tax Act, 1961 - Commissioner (Appeals) - Powers of - Assessment year 2004-05 - Whether an assessee is entitled to raise before appellate authorities additional grounds in terms of additional claims not made in return filed by it - Held, yes - Assessee-company claimed deduction under section 43B in respect of payment of SEBI fees of Rs. 20 lakhs paid - Subsequently assessee, in course of assessment proceedings before Assessing Officer, made a fresh claim for deduction ofRs. 40 lakhs stating that it had made another payment of SEBI fees of Rs. 40 lakhs on 9-5-2003 which pertained to provisions made for financial year 2001-02 and ....
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.... consideration on purchase of new agriculture land. This claim of the assessee was dismissed by the AO because registration of new agriculture land dated 2.11.2013 happened to be before the sale of original agriculture land for which sale deed has been registered on 13.1.2014, and even no such claim was made by the assessee by filing revised return. A perusal of the order extracted (supra), we find that the claim of the assessee was allowed by the Ld.CIT(A) on the ground that conditions for allowing such deduction under section 54B of the Act have been fulfilled by the assessee. Besides, that assessee made such claim even during the remand proceedings as well as a revised claim was made by the assessee before the AO. The Ld.CIT(A) observed that simply because the assessee has not filed a valid revised return, that would not be a ground for rejection of such claim. In order to understand legitimacy of the investment, the Ld.CIT(A) analysised fund flow statement filed by the assessee, which has been noticed by the Ld.CIT(A) at page no.19 of the impugned order. On date wise analysis of the same, the Ld.CIT(A) has come to the conclusion that assessee has utilised sales consideration of....
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....tional payment of Rs. 70.00 lakhs to one Smt.Subhnaben before 2022, for that an understanding to this effect was arrived between the parties. In support of this, the assessee filed an notarized documents dated 12.9.2013 and December, 2013 by which an amount of Rs. 70,00,000/- agreed to be paid to Subhanben Hajibhai by the assessee as compensation in the light of MOU entered on 5.1.2006. However, the Ld.AO did not accept this explanation of the assessee, and observed that since assessee has not furnished any details about the claim of the said Subhnaben on the said property, the claim of the assessee cannot be entertained, and therefore he made an addition of Rs. 77,86,500/- being the difference between the value adopted by the stamp valuation authority, and purchase consideration shown by the assessee by invoking provisions of section 56(2)(vii)(b). Against this addition, the assessee went in appeal before the Ld.first appellate authority. It was submitted by the assessee before the Ld.CIT(A) that no comparable instance was brought to the notice of the assessee to support the claim that jantri rate adopted by the AO was fair market value of the land purchased. The Ld.AO ought to h....