TaxTMI 
TaxTMI 
2024 (10) TMI 420
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....hereof is not exempt but chargeable to tax as Long term Capital gain. 2. That on the facts and in the circumstances of the case the ld CIT(A) is wrong, unjust and has erred in law in upholding finding recorded by the ld AO that agricultural land at vill Rampura, Tehsil Chaksu sold by the appellant during the year is a capital asset and not an agricultural land within meaning of sec. 2(14)(iii) of the IT Act, 1961 and therefore profit of Rs. 14050400/- earned by the appellant on sale thereof is not exempt but chargeable to tax as Long term Capital gain. 3. That without prejudice to the ground No (1) & (2) above the ld CIT (A) in further wrong and has erred in law in confirming action of the ld AO is not allowing benefit of investment of Rs. 13640000/- and Rs. 12935000/- made by the appellant in agricultural land and residential house u/s 54B and 54F of the IT Act, 1961 respectively from long term Capital gain of Rs. 14161287/- assessed by him. 4. The appellant craves permission to add to or amend to any of grounds of appeal or to withdraw any of them. 2. The brief facts of the case are that the assessee is an individual deriving income from rent, intere....
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....r Municipal Corporation is 7 Km and for agricultural land (ii) at village Rampura Tehsil, Chaksu stated that it is approximately 2 Km from Chaksu Municipality. The A.O. thereafter issued show cause notice asking the assessee as to why the agricultural land sold by assessee during the year should not be considered as capital assets and capital gain should be computed accordingly. 2.2 The assessee replied to show cause notice and derived support from certificate issued to her by same authority Tehsildar, Sanganer certifying that agricultural land situated at Sanganer sold by assessee is beyond 8 Km from Municipal limits and for agricultural land situated at Chaksu, the Tehsildar, Chaksu stated that aerial distance is approximately 2 Km. The assessee claimed that the from Municipality of Chaksu which is having population of more than ten thousand but less than one lac and so according to provisions of section 2(14)(iii)(b)(1) the land is agricultural land as it is beyond 2 km from Municipal limits of Chaksu and, therefore, claim made by assessee in the return is correct. 2.3 In the alternative the assessee claimed that assessee has purchased new agricultural land within the same....
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....of the IT Act, 1961 and therefore profit of Rs. 110887/- earned by the appellant on sale thereof is not exempt but chargeable to tax as Long term Capital gain. 1.1 It is evident from assessment order that assessee also filed before A.O. a copy of certificate from Tehsildar, Sanganer to the effect that impugned agricultural land is beyond 8 Km from Jaipur Municipal limit. The Ld. A.O. without finding any short coming therein issued a notice u/s 133 (6) of I. T. Act, 1961 to verify the claim made by assessee. The Tehsildar, Sanganer in reply to notice u/s 133 (6) vide letter dated 30-8- 2016 stated that the said agricultural land is beyond 7 Km from Municipal limit of Jaipur which Ld. A.O. used in case of assessee and added the word aerial distance used in assessment order by himself which is not in the certificate issued by Tehsildar. It is submitted that when same Tehsildar issued two different certificates for the same agricultural land than Ld. A.O. should have examined the Tehsildar thereon and should have made enquiry that how distances were measured while issuing two different certificates. Thus if prima facie appears that Tehsildar issuing certificates on his whims w....
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....d at vill Rampura, Tehsil Chaksu sold by the appellant during the year is a capital asset and not an agricultural land within meaning of sec. 2(14)(iii) of the IT Act, 1961 and therefore profit of Rs. 14050400/- earned by the appellant on sale thereof is not exempt but chargeable to tax as Long term Capital gain. 2.1 The assessee claimed that said agricultural land is beyond 2 Km from Chaksu Municipality which has population of more than ten thousand but less than one lac. The Ld. A.O. obtained certificate from Tehsildar, Chaksu who stated that the land sold by assessee is at distance (aerial distance) of approximately 2 Km from outer limit of Municipality of Chaksu. It is submitted that word "distance (aerial distance) is approximately 2 Km beyond outer limit of Chaksu Municipality" covers the case of assessee who is stating that land is beyond 2 Km of Chaksu Municipal limit. The Ld. A.O. is wrong in drawing inference from the certificate that it states the land is within 2 Km at Chaksu Municipal limits. The word approx. 2 Km means that it is 2 Km distance. Thus the land sold by assessee is clearly agricultural land and as agricultural land is not a capital asset no capit....
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....hich is not a capital asset and hence no capital gain tax is leviable thereon u/s 45 of the Act and long term capital gain tax levied by Ld. A.O. on the sale of said agricultural land is wrong which deserves to be deleted. It is thus prayed that the said land be held as agricultural land and not being capital asset not being liable to assess capital gain. Ground No. (3) 3. That without prejudice to the ground No (1) & (2) above the ld CIT (A) in further wrong and has erred in law in confirming action of the ld AO is not allowing benefit of investment of Rs. 13640000/- and Rs. 12935000/- made by the appellant in agricultural land and residential house u/s 54B and 54F of the IT Act, 1961 respectively from long term Capital gain of Rs. 14161287/- assessed by him. 3.1 It is evident from assessment order that assessee put forth his claim for allowability of deduction u/s 54B and 54F before Ld. A.O. and produce before him copy of purchase deed of agricultural land for purchase of agricultural land for Rs. 1,36,40,000/- for allowable deduction u/s 54B and a copy of purchase deed of residential house for purchase of Residential House at Rs. 1,29,35,000/-....
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....t naught the plenary powers of appellate authorities. It is well settled that even if a claim made by the assessee does not form part of the original return or even the revised return, it can still be considered, if, the relevant material is available on record, either by the Appellate Authorities, which includes both the Commissioner (Appeals) and the Tribunal by themselves or on remand, by the Assessing officer. Further Hon'ble Bombay High Court in the case of CIT Vs Pruthvi Brokers & Shareholders Pvt. Ltd. (2012) 349 ITR 336, 23 Taxmann. Com 23 (Bom) dated 21- 06-2012 after taking cognizance of the judgment of the Hon'ble Supreme Court in the case of Goetze (India) Ltd. (supra) observed, that an assessee in the course of proceedings before the appellate authorities is entitled to raise additional grounds not merely in terms of legal submissions, but also additional claims to wit claims not made in the return filed by it. The Hon'ble Supreme Court of India in the case of Perlo telecommunications and Electric Components India P Ltd. (2022) 141 Taxmann. Com 388 (SC) held that "where assessee-company had claimed certain amount of business expenditure under section ....
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....ee's claim for deduction u/s 54B of the Act, and finding the same in order had directed the A.O to allow the same. Before parting, we may herein observe, that as our indulgence has been sought by the department only for adjudicating as to whether or not the CIT(A) was well within his jurisdiction to allow the assessee's claim for deduction u/s 54B of the Act, despite the same not having been raised in the return of income, therefore, we are confining our adjudication to the said extent only. Accordingly, finding no infirmity in the order of the CIT(Appeals), who in our considered view remaining well within the realm of his jurisdiction had entertained the assessee's claim for deduction u/s. 54B of the Act and directed the A.O to allow the same, we uphold his order. We, thus, finding no merit in the claim of the revenue that the CIT(A) had erred in allowing the assessee's claim for deduction u/s 54B of the Act, dismiss the appeal. There is an old Circular issued by the Central Board of Direct Taxes Circular No: 14 (XL-35) dated April 11, 1955. It states that: "Officers of the Department must not take advantage of ignorance of an assessee as to his rights. It is one....
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....out verifying the actual distance only on estimates as per dictate which cannot be relied. The distance is to be measured aerially as per law in force for A.Y. 2014-15 which can only be done scientifically by putting aerial line on khasra maps from municipal limit and should have attached with certificate so as to rely any certificate of distance. Thus reliance placed by A.O. on certificate issued by Tehsildar, Sanganer is disregard of the certificate produced by assessee of the same Tehsildar, is without any basis and is wrong and bad in law. 5.1 Regarding land sold at village Rampura, Tehsil Chaksu, the assessee claimed that said agricultural land is beyond 2 Km from Chaksu Municipality which has population of more than ten thousand but less than one lac. On the other hand, the A.O. obtained certificate from Tehsildar, Chaksu who stated that the land sold by assessee is at distance (aerial distance) of approximately 2 Km from outer limit of Municipality of Chaksu. It is further noted from the record that during appeal proceedings the Ld. CIT (Appeals-2), Udaipur (Camp at Jaipur) vide letter dated 23-01-2018 called for the remand report from the AO in the case of assessee's hus....
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....cultural lands are deleted. 5.2 Regarding the issue involving grant of deduction under section 54B and 54F, we have considered the submissions of the ld. A/R and perused the records placed before us. It is evident from assessment order that assessee has claimed exemption/deduction under section 54B and 54F of the IT Act, 1961 before A.O. and produced before him copy of purchase deed of agricultural land for purchase of agricultural land for Rs. 1,36,40,000/- and a copy of purchase deed of residential house for purchase of Residential House at Rs. 1,29,35,000/- for allowing deduction under section 54B and under section 54F respectively. The AO denied the claim of the assessee on the ground that the assessee has not claimed the deduction in return filed under section 139(1) of the IT Act, 1961 nor filed a revised return claiming the said deduction. The ld. A/R submitted that the facts have been mentioned in the total income computation statement filed along with the return claiming the fact that the agriculture lands are situated beyond the Municipal limits. However, complete documentary evidences of purchase of new assets have been filed during the course of assessment proceeding....
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....ered, if, the relevant material is available on record, either by the Appellate Authorities, which includes both the Commissioner (Appeals) and the Tribunal by themselves or on remand, by the Assessing officer. In support of the claim of the assessee, the ld. A/R placed reliance on the following case laws :- (1) Hon'ble Bombay High Court in the case of CIT Vs Pruthvi Brokers & Shareholders Pvt. Ltd. (2012) 349 ITR 336, 23 Taxmann. Com 23 (Bom) dated 21-06-2012 after taking cognizance of the judgment of the Hon'ble Supreme Court in the case of Goetze (India) Ltd. (supra) observed, that an assessee in the course of proceedings before the appellate authorities is entitled to raise additional grounds not merely in terms of legal submissions, but also additional claims to wit claims not made in the return filed by it. (2) The Hon'ble Supreme Court of India in the case of Perlo telecommunications and Electric Components India P Ltd. (2022) 141 Taxmann. Com 388 (SC) held that "where assessee-company had claimed certain amount of business expenditure under section 37(1) during original assessment proceedings and during scrutiny assessment had filed revised computation of ....