TaxTMI 
TaxTMI 
2020 (12) TMI 930
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....ed and the additions so may kindly be deleted in full. 3. Rs. 16,49,210/-: The Id. CIT(A)has grossly erred in law as well as on the facts of the case in confirming the addition of Rs. 16,49,210/- on account of Long term capital gain on sale of residential agriculture land by not accepting the land development expenses/cost and other reasons. Hence the addition so made by the AO and confirmed by the Id. CIT(A) is being totally contrary to the provisions of law and facts on the record and hence same may kindly be deleted in full. 4. Rs. 1,67,125/-: The Id. CIT(A)has grossly erred in law as well as on the facts of the case in confirming the addition of Rs. 1,67,125/- on account of alleged excess sale consideration received on sale of land as against actual sale consideration. Hence the addition so made by the AO and confirmed by the Id. CIT(A) is being totally contrary to the provisions of law and facts on the record and hence same may kindly be deleted in full. 5. Rs. 10,97,040/-: The Id. CIT(A) has grossly erred in law as well as on the facts of the case in not allowing the deduction of Rs. 10,97040/- u/s 54F on the purchase of new assets for which the assessee is entitled. He....
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.... and also clearly arose from the order of AO and CIT(A) and in the return of income and having directly linked up with other grounds of appeal before your honor Therefore your honor are humbly requested to kindly admit the above additional grounds of appeal as above in the interest of natural justice and oblige." 2. The hearing of the appeal was concluded through video conference in view of the prevailing situation of Covid-19 Pandemic. 3. Brief facts of the case are that the assessee is not a regular income tax assessee. In this case the AO has issued the notice u/s 148 of the Income Tax Act, 1961 (in short, the Act) on dated 01.05.2014 and the same was received by the assessee on 16.09.2015. The AO has issued the notice u/s 148 of the Act on the reason that "As per AIR/CIB Information during the F.Y 2009-10 the assessee has sold immovable property of Rs. 30.00 lakh or more. As per office record the assessee has not filed his return of income for the A.Y. 2010-11. Therefore the A.O. has reason to believe that income of Rs. 68,32,875/- has escaped assessment. In response to the notice, the assessee has filed the return of income declaring the total income of Rs. 1,17,650/- on 0....
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....eved by the order of the A.O., the assessee carried the matter before the ld. CIT(A), who after considering both the parties, upheld the order of the A.O., against which the assessee is in further appeal before the ITAT on the grounds and additional grounds mentioned above. 5. In this appeal, the assessee has raised various grounds of appeal but the main grievance of the assessee is against initiating the proceedings U/s 147 of the Act without issuance of notice U/s 143(2) of the Act. In this regard, the ld AR of the assessee has reiterated the same arguments as were raised before the ld. CIT(A) and before the Bench, he has filed written submissions and additional written submissions and the same is reproduced below: 1. Assessment order is barred by limitation:- At the very outset it is submitted that the notice and assessment order passed by the AO is barred by the limitation because in this case the notice u/s 148 has been issued by the ld. AO on 01.05.2014 (PB2) or page 1 of the assessment order and the assessment was to be completed on or before 31.12.2015, as per the time limit for completion of the assessment u/s 153 (2), As per Sec. 153(2) No order of assessment, reassess....
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.... Add.CIT has grant approval in technical manner by stating yes or approved. He has relied on the following decisions" 1. Pr. CIT vs. N.C. CABLES LTD. (2017) 98 CCH 0018 Del HC 2. PAC AIR SYSTEMS P. LTD. vs. ITO (2020) 58 CCH 0001 Del Trib 3. GORIKA INVESTMENT AND EXPORT (P) LTD. vs. ITO (2018) 53 CCH 0168 Del Trib 4. TARA ALLOYS LTD. vs. ITO (2018) 63 ITR (Trib) 0484 (Delhi) The ld AR has also submitted as under: 1. Wrong Enhancement u/s 251(1): Further it is submitted that in this case the ld. CIT(A) has made enhancement u/s 251 of Rs. 50,000/- on account of brokerage paid on sale of land, Rs. 1,40,000/- on account of brokerage or commission paid on purchase of land and 32,175/-(Rs. 2,00,000/-1,67,125/-) on account of unexplained credit totalling to Rs. 2,22,175/- u/s 251 without giving any show cause notice to the assessee and it is the settled legal position that no income can be enhance by the And Sec. 251 Provides as under: 251. Powers of the Commissioner (Appeals).- (1) In disposing of an appeal, the Commissioner (Appeals) shall have the following powers- (a) in an appeal against an order of assessment, he may confirm, reduce, enhance or annul the assessment....
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....enses has been incurred by the assessee. At the worst the ld. AO could have estimated and verified from his own source. 2.3. In the interest of natural justice we pray your honor either accept our contention to delete the addition or the matter may be restored to the ld. AO for fresh examination so that we can produce the possible evidence or the contractor f required. 2.4 Further the ld. AO has denied the claim or deduction of Rs. 10,97,040/- u/s 54F on the ground of that assessee has not filled any evidence in support of claim. In this regard we have to submit the correct facts is that as the assessee has sold the agriculture land for Rs. 68.00 Lacks and calculated the LTCG vide computation of Total Income (PB 3) in which she claimed the indexed cost of acquisition of Rs. 16,50,784/-, Stamp Duty on Gift of Rs. 5,08,993/- and claim of Rs. 17,07,290/- u/s 54B, these are not disputed by the ld.AO. The assessee has also claimed the indexed cost of land Development expenses of Rs. 16,49,204/- (for which we have already sated in para 1 abvoe). After these claims the LTCG remained of Rs. 10,97,040/- which has been claimed by the assessee u/s 54F, which is allowable to this extent af....
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....he ld. CIT(A) enhanced the disallowance and confirmed the entire disallowance. In this regard it is submitted it is general practice to pay the brokerage in the property transaction and in the present case the person to whom brokerage was paid has expired. And it is not possible to produce the person and his death certificate is enclosed (PB35). Further the ld. CIT(A) has enhance the same without issuing any show cause notice to the assessee. For which we have already submitted in submission in "para B" as above which may kindly be considered. As the assessee is being a lady is unable to sale the land directly or unable to search the customers directly herself, therefore she has to engage the broker for this work for that she had to pay commission and the expense cannot be denied only in want of evidence but the facts and position should be appreciated. 3. Hence in view of the above facts, circumstances and legal position entire addition may kindly be deleted in full and oblige." 6. On the other hand, the ld DR has relied on the orders of the authorities below and relied on the various judicial pronouncements as under: (i) ITA No. 95 of 2009 of Hon'ble Calcutta High Court de....
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....ed the circular in this case and observed that in case where the AO chose to verify the return and frame an assessment he has to issue a notice u/s 143(3) of the Act requiring the assessee to produce his books of accounts and other material in support of his return. The Hon'ble High Court has further observed as: "Thereafter he can make an assessment order under sub-section(3) of the section 143 of the Act. Another important change incorporated in subsection (2) of section 143 of the Act is that the notice under this sub-section cannot be served on an assessee after the expiry of 12 months from the end of the month in which the return is furnished. Therefore, in a case where a return is filed and is proceed u/s 143(1)(a)of the Act and not notice under sub-section (2) of Section143) of the Act thereafter is served on the assessee within the stipulated period of 12 months, the assessment proceedings u/s 143 come to an end and the matter becomes final. Thus, although technically no assessment is framed in such a case yet the proceedings for assessment stand terminated. 10. We also observe that similarly the issue related to issue of notice u/s 143(2) in case of assessment has bee....
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....sidering the decision of the Hon'ble Madras High Court as well as Delhi High Court had held that Section143(2) of the Act, was a mandatory requirement and not a procedural one. In completing the assessment u/s 148 of the Act, compliance of the procedure laid down u/s 143 and 143(2) is mandatory. 12. We also observe that the sanction of the Add. CIT or CIT has neither been taken nor sought nor received by the ITO, also not appearing that there was any satisfaction of the Add. CIT/CIT or Pr. CIT etc. all these are absent on the reason recorded as provided by the AO and the same may be verified from the order sheet and assessment record. 13. From the record, we noticed that this specific ground was not raised by the assessee before the ld. CIT(A) or before the A.O.. Since, this ground is purely legal in nature, therefore, it can be raised by the assessee or any other party contesting the appeal at any point of time or at any stage. In this respect, we draw strength on the decision of the Hon'ble Supreme Court in the case of National Thermal Power Co. Ltd. Vs CIT 299 ITR 383. We have perused the revenue records as well as assessment records, which was summoned by us and after going t....