TaxTMI 
TaxTMI 
2022 (5) TMI 601
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.... including sale/purchase of property, indexed cost, etc. were thoroughly looked into and as such the assessment order passed was neither erroneous not prejudicial. 3. That the Ld. Commissioner of Income Tax has erred in failing to consider the various replies and submissions placed on record in proceedings before her in the correct perspective which is arbitrary and unjustified. 4. That the evidence placed before the Ld. Principal Commissioner of Income Tax has not been looked into by the PCIT himself and the matter cannot be sent back to the Assessing Officer without making any enquiry which renders the order illegal, arbitrary and unjustified. 5. That the assessment order having been passed by the Assessing Officer after due application of mind and taking into consideration the various replies and material on record, the action resorted to by the Commissioner of Income Tax is unwarranted and uncalled for. 6. That the order of Commissioner of Income tax is erroneous, arbitrary, opposed to the facts of the case and is unsustainable in law. 2. The hearing in the present case effectively took place on 02.02.2022 on which date the ld. AR and the ....
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....arch 14, 2021 stand excluded as per the decision of the Hon'ble Supreme Court. As such, the instant appeal was to be filed by 12th of May 2021. Thus there was a delay of only 8 days. 6. That unfortunately my Counsel Sh. Arvind Mehta Advocate expired due to Covid-19 on the 05.05.2021 after being hospitalized for almost a month. Copy of the death certificate has not been issued till date because of Covid. 7. That one of his office staff looking after Income Tax Matters Sh. Vinod also expired in the month of April 2021. 8. That I contacted Shri Tejmohan Singh, Advocate for filing of appeal after files from the office of Late Sh. Arvind Mehta Advocate and the appeal was filed on 20.05.2021. Sd/- Deponent Verification: Verified that the above noted contents of my affidavit are true and correct to the best of my knowledge and belief and nothing has been concealed therein. Dated: 07.06.2021 Sd/- Deponent 3.1. Accordingly, placing heavy reliance on the aggravating circumstances as set out in the aforesaid application and affidavit, it was his prayer that the delay may be condoned. 3.2. The l....
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....ecord is that these were filed before ld. PCIT. No error in these details of construction cost made available to the Revenue has been brought on record. Attention was invited to the facts. The assessee represented by its counsel Shri Arvind Mehta as noted by the ld. PCIT himself in his order attended the proceedings and filed details of expenses for construction/renovation of house No. 3113 Sector 28D, Chandigarh. It was submitted that though the ld. PCIT records that these were not filed during the assessment proceedings which issue is disputed by the assessee, however, since the counsel who was appearing has expired, no affidavits etc. can be now filed. It was argued that the fact remains that these were made available to the ld. PCIT and the ld. PCIT does not fault any of these details. He does not point out to any error in the claim of the assessee. The supporting claim, it was submitted, is based on facts and evidences and co-related with payments by cheque from the banks to a large extent. The ld. PCIT ignoring the evidences made available merely proceeds to cancel and set aside the validly passed assessment order for consideration afresh without pointing to any error justify....
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....Sector-17, Chandigarh. Dated:05-12-2016 To SH. MAHESH CHUGH, H. NO. 3420, SECTOR27-D, CHANDIGARH. PAN: ACZPC8060H Sir, Sub. : Assessment for the assessment year 2015-16- Regarding- Please refer to the assessment proceedings in your case for the above mentioned assessment year. 2. To enable the undersigned to frame assessment in your case, you are required to furnish/intimate/explain the following on the time & date as mentioned on the notice- u/s. 142(1) of the Act issued separately: 1. ........................ 2. ....................... 3 ......................... 4. As per information available with the department you have made large investments in the immovable properties. Please furnish the details of the immovable properties purchased by you in your name or in the name of your family member alongwith source of investment. 5. Please furnish the details of deductions claimed u/s. 54 along with copies of sale/purchase deeds of properties and calculations of LTCG. This information is being called for under section 142(1) of the Income Tax ....
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....ect matter. A detailed reply letter furnished as per the directions issued by your office. Further your office made observations related to deduction claimed under section 54F of the Income Tax Act 1961. It is submitted that the assessee sold capital assets during the relevant financial year i.e. 2014-2015. The total consideration amount further reinvested in a residential house and claimed deduction under section 54F of the Income Tax Act 1961. The assessee is having only one residential house No. 3420, Sector-27-C Chandigarh, during the relevant financial year in question i.e. his place of residence declared in his income tax return for the A.Y. 2015-16. There is no other residential house in his name. Therefore the assessee has correctly claimed deduction under section 54F of the Income Tax Act 1961. It is requested to acknowledge the above stated fact and in light of above do the needful in the interest of justice. Regards (On behalf of Mahesh Chugh) Sd/- (Arvind Mehta) AdvocateCounsel 5.5. The reply at page 28-30 of the Paper Book to the Show Cause Notice issued by the ld. PCIT extracted in the impugned order appended at....
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....y in the same is pointed out except for suspicions, those also not based on any facts. 6. In the said background, reliance was placed on various decisions including the case of Hari Iron Trading Co. vs. CIT 263 ITR 437(P&H), ITO vs. D.G. Housing Projects Ltd. 343 ITR 239 (Delhi), Director of Income Tax vs. Jyoti Foundation 357 ITR 388 (Delhi), PCIT vs. Delhi Airport Merto Express (P.) Ltd. 398 ITR 8 (Delhi) Abhimanyu Gupta vs. Pr. CIT ITA No. 771/Chandi/2017 to support the prayer that the order may be quashed. 6.1. Specific attention was invited to the decision of the Hon'ble Delhi High Court in the case of Delhi Airport Metro Express Pvt. Ltd. (supra) specifically for the proposition that in order to set aside the assessment order exercising the powers vested by Section 263 of the Act, it is incumbent upon the ld. PCIT to point out the errors in the order. Referring to the said decision specifically and the other decisions cited, it was submitted that this power cannot be exercised carelessly and whimsically. 6.2. Attention was also invited to the decision of the Hon'ble Delhi High Court in the case of D.G. Housing Projects Ltd. (supra) for the proposition that th....
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....t some calculations have been made available by the Revenue as per letter dated 16.09.2021 wherein the following calculation is given: 2. Thus to work out the deduction u/s. 54F(1)(b), three ingredients required to be considered are: i) Net consideration in respect of the original asset; ii) Capital Gains; and iii) Cost of the new asset In the present case these are as under: i) 2,96,25,000/- ii) 2,00,87,010/- iii) 2,17,35,000/- Considering the above figures and by applying the formulae as provided in clause (b) of sub-section (1) of Section 54F of the Act, the permissible deduction comes to Rs. 1,47,37,254/- as against claimed and allowed at the time of assessment at Rs. 1,85,85,741/-." 8.1. The ld. CIT-DR sought time to verify the calculations and consult from the field as to what is the exact figure in dispute; he submitted that arguments of the Revenue are concluded; however, time for factual verification was sought. 9. Accordingly, time was granted. 10. On the next date, following submissions were filed on behalf of the Revenue: Feb. 2, 2022 The Hon'ble Members Chand....
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....alized that there was a difference of Rs. 8,26,189/- and not Rs. 10,15,000/- as considered in the impugned order. It was his submission that even if the higher figure of Rs. 10,15,000/- as noticed by the ld. PCIT is taken the fact remains that there is no error in the order which can be considered to be erroneous and prejudicial to the interests of the Revenue as the calculations provided above are not considering the renovation claim of Rs. 10,15,000/- which the Revenue seeks to look into in the set aside proceedings. The argument that it was seen by the AO, even if it remains unproved on account of unavailability of the Affidavit of late Mr. Mehta. The fact remains that these calculations were always available to the Revenue as these have indisputably been filed before the ld. PCIT and are on record. It is argued that these have not been faulted. The Revenue, it was submitted, may not be allowed to exercise the Revisionary powers casually and whimsically. It was argued that the law requires that error on examining the evidences filed has to be pointed out by the ld. PCIT and this exercise cannot be avoided Such an action is lacking in the present proceedings as no error, let alon....
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....o. 13-14, Sector 27-D, Chd (17.5%) Total Value u/s 50C Rs. 4500000.00 Rs. 15500000.00 Rs. 9625000.00 Rs. 29625000.00 Less: Transfer Exp. Rs.00 Rs.00 Rs.00 Rs.00 Net Consideration Rs. 4500000.00 Rs. 15500000.00 Rs. 9625000.00 Rs. 29625000.00 Less: Indexed Cost Rs. 4864223.00 Rs. 2608917.00 Rs. 2064850.00 Rs. 9537990.00 Term Capital Gain/Loss (-) 364223.00 Rs. 12891083.00 Rs. 7560150.00 Rs. 20087010.00 Amount invested in purchase of house property @ 75% share of the assessee Rs. 21735000.00 Therefore allowable deduction u/s. 54F of the IT Act is calculated as under:- Long Term Capital Gain (2,00,87,010) X amount invested to purchase new asset (2,17,35,000) Net Consideration(2,96,25,000) = 1,47,37,254/- 13.1. The reply of the assessee to the ld. PCIT has also been extracted in the impugned order. For ready reference, same is reproduced hereunder: 2. In response to this notice, Sh. Arvind Mehta, Advocate, who was duly authorized by the assessee appeared and submitted his power of attorney and reply alongwith enclosure....
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....to tax and deposited long term capital gains tax of Rs. 2,15,358/-. Therefore the assessment framed under section 143(3) of the Act is not erroneous. The assessee has claimed correct deduction u/s. 5 F(1)(b) of the Income Tax Act, 1961 and deposited the long term capital gains tax as per provision of the Act. It is therefore requested to knowledge the facts stated above and shall not invoke provision of section 263 of the Income Tax Act, 1961 in the interest of Justice and Oblige. (emphasis supplied) 13.2. Considering this, the ld. PCIT passed the following order on facts: 3. The assessee purchased a residential house No. 3113, Sector 28-D, Chandigarh for total consideration of Rs. 2,89,80,000/- in which the share of the assessee (75%) was Rs. 2,17,35,000/-. The assessee had claimed investment of Rs. 1,55,00,000/- in residential property for computing deduction u/s. 54F on the sale of Plot No. 182/49, Indl. Area, Phase-I, Chandigarh. Further investment of Rs. 72,50,000/- was claimed in house property for claiming deduction u/s. 54F from the sale of Bay Shop No. 13-14, Sector 27-D. Chandigarh. Thus the total investment in residential properties....
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....roneous and prejudicial to the interests of the Revenue. The fact that the construction cost details were actually provided on query to the AO or not as they do not find any mention in the assessment order, we find in the peculiar facts is neither here nor there. The fact remains that these were provided to the ld. PCIT. We do not need to cite any decisions to address the well accepted position that the assessee cannot be faulted on how the assessment orders are written. The writing of assessment orders are exclusively in the hands and the domain of the Revenue and merely because facts on which the AO is satisfied are not found mentioned in the order, the absence of discussion thereon shall not by itself be an indicator of the fact that the AO has failed to examine the issue. Such an inference cannot be drawn. We have seen the queries raised in the course of the assessment proceedings. We have seen the responses given thereto. No doubt that the assessee is faced with a handicap that the counsel representing before the AO and before the ld. PCIT has passed away in the COVID times, however, the fact which remains to be demonstrated by the Revenue is the error and that too such an err....