TaxTMI 
TaxTMI 
2025 (2) TMI 1428
X X X X Extracts X X X X
X X X X Extracts X X X X
....n Act in filing of appeal Hon'ble Sir(s), The humble assessee appellant applicant respectfully prays for the condonation of delay of 108 days in the filling of Appeal for the following reason: 1. That the Id. CIT (Appeals) passed his order on 06.12.2023 which was served upon the email Id. [email protected] which is belongs to the Son of the assessee appellant Shri Ankush Choudhary. 2. That Shri Ankush Choudhary is suffering from mental trauma because of one accident happened in the family in which the 3-Year-old child of Shri Ankush Choudhary is died and Shri Ankush Choudhary Son of assessee appellant went into the Mental Trauma. 3. That assessee appellant not well aware about the Income tax provision and online proceeding and also has no email account therefore the in the income tax portal the email which is provided is belongs to his son and due to the accident as stated above, his son has not seen any email and therefore the order dated 06.12.2023 was not communicated to the assessee appellant. 4. That assessee appellant received the outstanding demand notice from the income tax department on 04.05.2024 through ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....the appeal was filed. In support of the contention so raised assessee filed an affidavit also. Considering the fact that the assessee was prevented with sufficient cause for not filling the appeal in time and therefore, the same is condone. Thus the delay of 108 days in filing the appeal by the assessee is condoned in view of the decision of Hon'ble Supreme Court in the case of Collector, land Acquisition vs. Mst. Katiji and Others, 167 ITR 471 (SC) as the assessee is prevented by sufficient cause. 5. In this appeal, the assessee has raised following grounds: - "1. That on the facts and circumstances of the case and in law the ld. CIT in passing the ex-parte and confirming the penalty of Rs. 1,00,00,000/- u/s 271D imposed by the Id. assessing officer." 2. The appellant craves leave to add, alter, modify or amend any ground on or before the date of hearing." 6. Further, in this appeal, the assessee has raised additional ground praying there to admit the same as it is pure technical and does not require any further finding of facts : - 1. That in the law the impugned penalty order passed u/s 271D of the Act is without jurisdiction as the same has ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....n 20/6/2013. Except the agreement in question which is claimed to have been notarized and not a registered agreement there is no other document in support of the claim that the amount was received as an advance against the sale of property. The only evidence which can be independently verified is the receipt of payment of Rs. 50/- in the office of the Sub Registrar, Behror on 21/4/2017. The said receipt was subsequent to the assessment order as well as the show cause notice issued U/s 271D of the Act on 25/1/2017, therefore, prior to the show cause notice U/s 15/1/2017, there was no document which can independently verified the existence of this claim though the assessee has produced this agreement dated 20/6/2013. It is pertinent to note that if the assessee is having/ holding the land in question i.e. khasra No. 24 measuring 1.11 hectare situated at village Dhodhakari, Tehsil-Neemrana, Alwar then in absence of any contrary record, the explanation of the assessee that the said amount was received as an advance against the sale of the land, cannot be rejected. However, neither the Assessing Officer nor the ld. CIT(A) has examined whether the assessee owned this land in question whi....
X X X X Extracts X X X X
X X X X Extracts X X X X
....laimed to have been executed on 12.12.2012 and the same was notarized only on 20.06.2013 shows that this agreement was prepared subsequently by using old stamp paper to give the color of sale of property. Thus, the AO considered the sum of Rs. 1,00,00,000/- received by the appellant from MRs. Maya Devi as loan and accordingly penalty proceedings u/s 271D of the Act for violating the provisions of section 26955 of the Act and penalty of Rs. 1,00,00,000/- u/s 271D of the Act was levied vide order dated 17.05.2017. The Ld. CIT appeal however accepted the transactions as advance received against the sale of property and accordingly deleted the penalty of Rs. 1,00,00,000/- 8.3 Aggrieved with the decision of the CIT Appeal, the department approached the ITAT, which held that prior to the show cause notice u/s 271D of the Act on 25.01.2017, "there was no document which can independently verified the existence of this claim though the assessee has produced this agreement dated 20/6/2013. It is pertinent to note that if the assessee is having/holding the land in question le khasra No. 24 measuring 1.11 hectare situated at village Dhodhakari, Tehsil- Neemrana, Alwar then in....
X X X X Extracts X X X X
X X X X Extracts X X X X
....erts that it was an advance against the sale of the property. At the core of the matter is the ownership status of the agricultural land in question as on the alleged date of agreement i.e. 12.12.2012. The conclusion of whether the amount received was a loan or an advance against the sale of the property, hinges on the verification of the land's ownership by the assessee, along with its freedom from encumbrances for a lawful transfer. 8.7 The fact that the appellant was not owning the subject property as on 12.12.2012 and became the owner only on 10.04.2013 stands substantiated by the documents received from the Sub Registrar's Office. This was the limited purpose for which the issue was set aside by the Hon'ble ITAT. The Hon'ble ITAT had given a clear direction that "In case, the land in question is found to be owned by the assessee then the claim of the assessee shall be accepted and no penalty can be levied." As a natural corollary, in case the land in question is not found to be owned by the assessee on 12.12.2012 then the claim of the assessee shall not be accepted and the penalty can be levied. It is reiterated that neither in the statement of facts n....
X X X X Extracts X X X X
X X X X Extracts X X X X
....4.2013. 11.04.2013 Oral agreement to sale entered into by the assessee to sell the agricultural land with Smt. Maya Devi and payment of Rs 40,00,000/- received as token advance for the sale of agriculture land. 22.04.2013 Payment of Rs 50,00,000/- received as token advance for the Sale of agriculture land from Smt. Maya Devi. 20.06.2013 Payment of Rs 10,00,000/- received as token advance for the Sale of agriculture land from Smt. Maya Devi. 20.06.2013 Execution of agreement to sale on Stamp Paper dated 12.12.2012 [PB 1-5] which is duly notarized on 20.06.2013. Time granted to enter into registered sale deed is 31.05.2015. 31.05.2015 Date of registration of sale deed is mutually extended till 23.12.2016 due to financial hardship of the purchaser, Smt. Maya Devi. 23.12.2016 Date of registration of sale deed again extended mutually till 20.04.2017 due to financial hardship of the purchaser, Smt. Maya Devi and with the condition of forfeiture of payment already made for the purchase of agricultural land if the sale deed is not executed between the parties. 29.05.2017 Legal notice issued by the purchaser, Smt. Maya Devi to the assessee seeking r....
X X X X Extracts X X X X
X X X X Extracts X X X X
....received as an advance against the sale of the land, cannot be rejected. 19.03.2019 To comply with the directions given by the Hon'ble ITAT the ld. Assessing Officer called the report from the Sub-Registrar, Neemrana. As per the report of the Sub- Registrar, the assessee purchase the said land in question vide registered sale deed dated 10.04.2013. Note: Subsequently the agreement to sale was entered into by the assessee with Smt. Maya Devi on 20.06.2013. Thus undisputedly he was the owner of the agricultural land at the time of entering into agreement to sale. 25.03.2019 Penalty Order passed u/s. 271D levying Rs 1.00 Crore penalty (PB 42- 43). The ld. Assistant Commissioner of Income Tax, Circle 2, Alwar, i.e., the Assessing Officer imposed the penalty by relying upon the date of the Stamp Paper, i.e., 12.12.2012 and ignoring the specific directions of the Hon'ble ITAT. Note: POWER TO LEVY PENALTY U/S. 271D OF THE ACT VESTS WITH JOINT COMMISSIONER OF INCOME TAX AND NOT WITH THE ASSISTANT COMMISSIONER OF INCOME TAX. 06.12.2023 CIT(A) confirmed the levy of penalty u/s. 271D (PB 26- 34). That notices for hearing was served upon the upon the em....
X X X X Extracts X X X X
X X X X Extracts X X X X
....it or specified sum, where the person from whom the loan or deposit or specified sum is taken or accepted and the person by whom the loan or deposit or specified sum is taken or accepted, are both having agricultural income and neither of them has any income chargeable to tax under this Act. Provided also that the provisions of this section shall have effect, as if for the words "twenty thousand rupees", the words "two lakh rupees" had been substituted in the case of any deposit or loan where,- (a) such deposit is accepted by a primary agricultural credit society or a primary co-operative agricultural and rural development bank from its member; or (b) such loan is taken from a primary agricultural credit society or a primary co- operative agricultural and rural development bank by its member. Explanation .- For the purposes of this section,- (i) "banking company" means a company to which the provisions of the Banking Regulation Act, 1949 (10 of 1949) applies and includes any bank or banking institution referred to in section 51 of that Act; (ii) "co-operative bank", "primary agricultural credit society" and "primary co-operative....
X X X X Extracts X X X X
X X X X Extracts X X X X
....in a particular manner following a particular procedure, it shall have to be done in the same manner following the provisions of law without deviating from the prescribed procedure. The said principle has again been reiterated and followed in the case of Municipal Corporation Greater Mumbai v. Abhilash Lal and others 2020 13 SCC 234, and in the case of Opto Circuit India Limited v. Axis Bank and others 2021 6 SCC 707 and again in the case of Union of India v. Mahesh Sing CAP.No.4807 of 2022. In the case of Tata Chemicals Limited v. Commissioner of Customs (Preventive) 2015 11 SCC 628, it has been held that there can be no stopple against the law. If the law requires something to be done in a particular manner, then it must be done in that manner, if it is not done in that manner then it would have no existence in the eye of law. The Hon'ble Supreme Court held as under: The Tribunal's judgment has proceeded on the basis that even though the samples were drawn contrary to law, the appellants would be estopped because their representative was present when the samples were drawn and they did not object immediately. This is a completely perverse finding both on fact and....
X X X X Extracts X X X X
X X X X Extracts X X X X
....reement executed on a subsequent date is a nuanced topic with significant implications in contractual law. This analysis seeks to elaborate on the principle that the date on a stamp paper does not affect the date of execution of the agreement, provided the document adheres to the requirements set forth by the Rajasthan Stamp Act, 1998. A deeper exploration of the legal provisions, judicial precedents and practical implications offers clarity on this proposition. The Rajasthan Stamp Act, 1998, governs the imposition and collection of stamp duty on various instruments executed within the state. However, the Rajasthan Stamp Act, 1998 NOWHERE stipulates that the date of purchase of the stamp paper must align with the execution date of the agreement. This distinction is pivotal to understanding the principle of validity in such cases. 15. That Hon'ble Supreme Court in the matter of Thiruvengada Pillai v. Navaneethammal & Anr. (2008) 4 SCC 530, held that an agreement executed on an old stamp paper does not become invalid solely due to the time lapse between the purchase of the stamp paper and the execution of the agreement. 16. That allegations of backdating agreeme....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e deleted. Alternatively, on the merit part of the case he argued that the assessee become the owner of the land as verified by the ld. AO in the remand proceeding as per direction of the ITAT on 10.04.2013 and the money has been accepted thereafter as detailed herein below: Date Amount 11.04.2013 Rs. 40,00,000/- 22.04.2013 Rs. 50,00,000/- 20.06.2013 Rs. 10,00,000/- Total Rs. 1,00,00,000/- Thus, as per the direction of the ITAT the penalty cannot be levied. 13. Per contra, the ld DR vehemently argued that the assessee did not respond to the notices given by ld. CIT(A) and ld. CIT(A) has rightly dismissed the appeal of the assessee. Ld. DR objected to the additional ground raised by the assessee and submitted that the said ground was not taken before the lower authorities. Ld. DR also vehemently argued that the Ld. ACIT has not passed an order for levy of penalty, but he has given the appeal effect arising on account of order of Co-ordinate Bench of ITAT and therefore, the issue of jurisdiction raised by the assessee has no merit and required to be dismissed. So far as the levy of penalty she relied upon the orders of the lower authority. She also....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... matter, it is necessary to verify the fact that the land in question is owned by the assessee and free from all encumbrances so it can be freely transferred. Accordingly for the limited purpose we set aside this issue to the record of the assessing officer to conduct a necessary enquiry in respect of the status and ownership of the land in question as on the date of the alleged agreement. In case, the land in question is found to be owned by the assessee then the claim of the assessee shall be accepted and no penalty cab be levied." (copy of ITAT order is enclosed as Annexure 'C' for kind perusal). In compliance to the order of Hon'ble ITAT, a letter was sent to the Sub-Registrar, Neemrana to seek Jamabandi & Sale Deed for this land for verification of the issue, In response to same Sub-Registrar, Neemrana provided the required details vide his letter dated. 19.03.2019. On perusal of sale deed, it is revealed that Sh. Balbir Singh, had purchased the land in contention on 10.04.2013. Hence, it is ample clear that assessee was not owner on the date of purported agreement that is 12.12.2012. Therefore, claim of assessee that amount of Rs. 1,00,00,000/- was receiv....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... of the Act is without jurisdiction as the same has been passed by the Id Assistant Commissioner of Income Tax whereas as per section 271D the same could have been levied by the Id Joint Commissioner of Income Tax only which makes the impugned order illegal, void as initio bad in law and same deserved to be quashed and set aside. The contention of the assessee is not acceptable since order u/s 271D had been passed by the Jt. CIT, Range-2, Alwar as provided under the Aet and not by the ACIT, Circle-2, Alwar and impugned order is not illegal as bad in law. Submitted for kind information & perusal please." 14. We have heard the rival contentions and perused the material placed on record. The bench noted that the assessee is in second round of litigation. In the first round the matter was reached to this tribunal wherein the tribunal has directed to the ld. AO to verity the facts of the ownership issue in the hands of the assessee. The relevant direction of the coordinate bench was as under: "6. We have heard the rival contentions and perused the material available on the record. The Assessing Officer has observed that the amount of Rs. 1.00 crore received by the a....
X X X X Extracts X X X X
X X X X Extracts X X X X
....he assessee then the claim of the assessee shall be accepted and no penalty can be levied." 15. Based on the above direction the ld. AO issued a letter to sub-registrar which is reported in his report reads as under: "In compliance to the order of Hon'ble ITAT, a letter was sent to the Sub-Registrar, Neemrana to seek Jamabandi & Sale Deed for this land for verification of the issue, In response to same Sub-Registrar, Neemrana provided the required details vide his letter dated. 19.03.2019. On perusal of sale deed, it is revealed that Sh. Balbir Singh, had purchased the land in contention on 10.04.2013. Hence, it is ample clear that assessee was not owner on the date of purported agreement that is 12.12.2012. Therefore, claim of assessee that amount of Rs. 1,00,00,000/- was received from Smt. Maya Devi on account of advance is false and appears to be a concocted story. The ACIT, Circle-2, Alwar has passed order giving effect to the Hon'ble ITAT u/s 271D r.w.s. 250/254 of the Act on 25.03.2019 after verifying the facts from the details provided by the Sub- Registrar, Neemrana (Copy of order giving effect by the ACIT, Circle-2, Alwar enclosed as Annexure 'D'....