AI Drafter 
TaxTMI 
TaxTMI 
TaxTMI 
2022 (9) TMI 468
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....rs 2011-12 to 2016-17. The present assessment year before us is the year of search namely assessment year 2017- 18. During this assessment year, the assessee had transferred shares of Excel Corp Care Ltd. and Transpek Industris Ltd. for a consideration of Rs. 15,77,30,705/- and offered net capital gain of Rs. Nil as the assessee has reinvested the consideration in a residential property at Colaba, Mumbai u/s. 54 of the Act of Rs. 14,14,55,783/-. On verification of the claim the assessing officer held that the assessee already owned two residential property namely (i) House no. 1028, Bhaili Road, Raipura, Vadodara ("the Raipura House") and (ii) Vishubaug Farm property at Kharakhadi ("the Farm"). 2.1. The assessee claimed that the Farm property is an agricultural land used for carrying out agricultural activities wherein there is a Manager's office, storehouse for farm equipments and agricultural produce stored there. Further the farm property also has a cow shed with 66 cows. The milk from these cows are sold and income is from generated the same. Thus the farm is exclusively used for agricultural purposes and it's not a residential building and the employees of the assessee are ....
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....of the Act as well as the assessee having failed to declare any agricultural income from the Farm property, on that count also the claim of the assessee the Farm property as a commercial property was rejected by the Ld.CIT(A) as follows: 5.6 The thrust of appellant's arguments are that - a. The Farm is not a residential house and is only used for carrying out agricultural activities and commercial activities. b. The income, if any, from the building on the Farm would not be- chargeable to tax under the head "Income from House Property" and hence, proviso to section 54F is not applicable. c. The Appellant is not personally carrying out any agricultural activity and he is not required to reside at the Farm and therefore he does not reside at the Farm. d. The Appellant has made heavy investment in constructing his elegant bungalow at Raipura and the same is mainly for residential purpose and it cannot be assumed that the Appellant would reside at the Farm instead of the House at Raipura. e. Without prejudice to above, the Appellant in any case is a joint owner of the land and hence proviso to section 54F is not applicable to th....
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....g other things also means (c) any income derived from any building owned and occupied by the receiver of the rent or revenue of any such land, or occupied by the cultivator or the receiver of rent-in-kind, of any land with respect to which, or the produce of which, any process mentioned in paragraphs (ii) and (iii) of sub-clause (b) is carried on: Provided that - if the building is on or in the immediate vicinity of the land, and is a building which the receiver of the rent or revenue or the cultivator, or the receiver of rent-in-kind, by reason of his connection with the land, requires as a dwelling house, or as a store-house, or other out-building and the land is either assessed to, land revenue in India or is subject to a local rate assessed and collected by the Officers of the Government or where the land is not so assessed is situated in any area which is comprised within the jurisdiction of the Municipal Corporation or in any area within the specified distance from the local limits of any Municipality. 5.11 No dispute has been created by the AO as to 22 acres of land not being agricultural land. Thus it may be presumed that the land is agricultural land and ....
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....is not protected by the case laws relied upon in this regard because the appellant also has a full-fledged residential property (1028, Raipura). I am also of the considered view that sec.54F allows only one residential property and the benefit ceases if the assessee has more than one residential property and the appellant definitely has more than one residential property. 5.15 In the facts and circumstances of the case the appellant is found to be-owner of more than one residential house other than the new asset (residential property at Colaba, Mumbai) on the date of transfer of the original asset (shares). I find no basis to interfere with the assessment order impugned in the appeal by the appellant. The addition is confirmed and the related grounds are dismissed. 4. Aggrieved against the appellate order, the assessee is in appeal before us raising the following Grounds of Appeal: All the grounds of appeal in this appeal are mutually exclusive and without prejudice to each other. 1. The learned Commissioner of Income Tax (Appeals) -12, Ahmedabad ["CIT(A)"] erred in fact and in law in confirming the action of the learned Deputy Commissioner of Income T....
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.... the action of the AO in charging interest u/s 234B of the Act. 11. The learned CIT(A) erred in fact and in law in confirming the action of the AO in initiating penalty u/s. 270A of the Act. 4.1. Ld. Counsel Mr. Milin Mehta appearing for the assessee submitted before us, the lower authorities failed to consider that there is only residential property available to the assessee namely Raipura House wherein the assessee is residing. The Vishubag Farm property is jointly held by the assessee with his wife and daughter as co-owners which is nothing but a commercial property. The net result of such commercial activities carried out is negative therefore the same is not declared by the assessee in its Return of Income. In fact the assessee was maintaining a bank account with Axis Bank and State Bank of India wherein amount received from sale of dairy products, vegetables have been deposited in the bank account and expenses namely salary to staff members, purchase of pesticides, fertilizers, minerals mixture, cow concentrate etc. were being spent through the above bank accounts only. These transactions in the bank statement itself confirmed that the commercial activity as well ....