ITA NO. 3345/Del/2013
IN THE INCOME TAX APPELLATE TRIBUNAL
DELHI BENCH "E", NEW DELHI
BEFORE SHRI R.P. TOLANI, JUDICIAL MEMBER
AND
SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER
I.T.A. No. 3345/DEL/2013
A.Y. : 2009-10
ITO, WARD 42(4), VS. SMT. NANDITA
NEW DELHI GUPTA,
B-10, HOUSING
SOCIETY,
NDSE PART-I,
NEW DELHI 110 049
(PAN: AGWPG7810N)
(APPELLANT) (RESPONDENT)
Assessee by : Sh. Pradeep Dinodia, Advocate
& Sh. R.K. Kapoor, CA
Department by : Sh. Keyur Patel, Sr. DR
ORDER
PER SHAMIM YAHYA: AM
This appeal by the Revenue is directed against the order of the
Ld. Commissioner of Income Tax (Appeals-XXX), New Delhi dated
22.3.2013 pertaining to assessment year 2009-10.
2. The grounds raised read as under:-
"On the facts and in the circumstances of the case and in law,
the Ld. CIT(A) has erred in
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1) Admitting the additional evidence in contraventions of
Rule 46A without giving an opportunity to the AO nor
calling Remand Report to justify the additions.
2) Deleting the addition of Rs. 35,00,000/- by withdrawing
exemption u/s. 54 of the I.T. Act.
3) Deleting of addition of Rs. 1,44,529/- made on account of
undisclosed Short Term Capital Gain.
The appellant craves the right to alter, amend, add or
substitute the grounds of appeal."
3. 35,00,000/-.
Apropos issue of deletion of addition of Rs. 35,00,000/-
In this case assessee has sold residential property being
residential Plot at DLF City-IV, Gurgaon, at Chakkaerpur measuring
225 sqmtr. for a total consideration of Rs. 43,05,600/-. The said
property was purchased in the year 1991-92 for Rs. 1,47,580/- after
deducing Index Cost of Rs. 4,31,616/- a capital gain of Rs.
38,73,984/- accrued to the assessee. Assessee claimed to have paid
Rs. 35 lacs for purchase of a residential house and accordingly,
claimed deduction u/s. 54 amounting to Rs. 35,00,000/-. The
assessee has submitted a sale deed for a free hold property at
Greater Kailash which was in favor of Ms. Nandita Gupta and
Shweta Gupta for a total consideration of Rs. 80,00,000/- having
50% shares each in the property. The sale deed was executed by
Raman Gupta - Karta of Gupta Traders an HUF. From the details
submitted for the payment of the amount, AO was not satisfied that
the total amount has been paid. AO was also not satisfied that the
property was transferred. AO held as under:-
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"The sale deed executed is on a stamp paper of Rs. 100/-.
The sale deed is not registered with Sub Registrar of
property. The affidavit filed confirming receipt of sale
proceeds is in individual capacity. The assessee has not
filed copy of income tax return in the case of HUF
declaring therein the sale of the property. The assessee
has purchased shares and did not pay the sale amount
towards purchase of a new house property. The entire
transaction is a family affair and is not genuine. The
transaction is made solely to evade tax on long term
capital gain. I, therefore, hold that the assessee has not
invested anything in the purchase of new house property
to qualify for claiming deduction u/s. 54 of the I.T. Act.
Penalty proceedings u/s. 271(1)(c) of the I.T. Act have
been initiated separately."
4. Upon assesse's appeal Ld. CIT(A) considered the submissions
of the assessee and held as under:-
"I have perused the assessment order, grounds of
appeal, written submission and discussed the matter with
the appellant very carefully. The AO had made an
addition of RS.35,OO,OOO/- by disallowing exemption
claimed u/s 54 of the LT. Act to the appellant. There is
another disallowance of RS.50,OOOI- on household
expenses. The appellant is a daughter of a businessman,
deriving income from advertising agency and running a
company Newfields Advertising Pvt. Ltd. The main Karta
of the family is Sh. Raman Gupta, appellant's father. The
AR of the appellant had produced a family tree of Raman
Gupta which clearly shows how the appellant is employee
of HUF of Raman Gupta, i.e., MIs Gupta Traders. The
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appellant and her mother are employees in the HUF and
Mr. Raman Gupta with sons and other unmarried
daughter are employees of the company. The appellant's
family had adopted good tax planning from the
beginning. It is not a case of tax evasion. The written
submissions of the AR are very clear. The appellant had
sold a property which was purchased by her in the year
1991-92. Since this is a Long Term Capital Gain, the AO
had confused the transaction by not considering the
appellant's submission at assessment stage. The AO in
his observation in para 5.iii & 5.iv had mentioned that
cheque nos.033892 & 33894 dt.13.12.2007 towards sale
consideration of RS.11,00,000/- but had not considered
the legal provisions of HUF Law. The appellant had paid
the cheques to the company where his father is director,
for purchase of the new property and that the reason for
disallowance of the transaction. Another clause is sale
deed executed in stamp paper of RS.100 which is not
registered with the Sub-Registrar of the Property. The
entire transaction is a family affair and is not genuine
alleged by the AO (if it is a power of attorney sale within
the family arrangements still it is a sale). Now the
appellant got married and staying separately in that
house. Since the house is acquired in 1991 and
investment is made in 2009, the long term capital gain
arises in the case of exemption u/s 54 is allowed. The
addition of RS.35,00,000/-- is deleted."
5. Against the above order the Revenue is in appeal before us.
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6. At the outset, Ld. DR submitted that Ld. CIT(A) has considered
the various aspects of the submissions of the assessee which were
not before the AO. He submitted that assessee has also not made
any application for additional evidence, despite that Ld. CIT(A) has
proceeded to consider the new submission by the assessee. He
submitted that Ld. CIT(A) has also not called for any remand report
from the AO. Hence, the Ld. DR pleaded that the matter may be
remitted to the file of the AO to consider the issue afresh. Ld.
Counsel of the assessee, on the other hand, relied upon by the order
of the Ld. CIT(A) and submitted that Ld. CIT(A) has passed
reasonable order, after properly appreciating the facts of the case.
7. We have carefully considered the submissions and perused the
records. We find that from the perusal of the Ld. CIT(A)'s order, it is
apparent that Ld. CIT(A) has considered the various aspects of the
submissions and claim of the assessee which were not before the
AO. Ld. CIT(A) has not asked for any remand report from the AO in
this regard. In these circumstances, in our considered opinion,
interest of justice will be served, if this issue is remitted to the file of
the AO to consider the issue afresh, after giving the assessee
adequate opportunity of being heard. Both the counsel agreed to
this proposition. We hold and direct accordingly.
8. 1,44,529/-
Apropos deletion of addition of Rs. 1,44,529/-
On this issue AO noted that assessee has maintained DMAT
Account with M/s ISF Securities Ltd.. AO noted that as per the script
wise net position details submitted by M/s ISF Securities, the
assessee has earned net profit of Rs. 1,44,529/-. Assessee was
confronted with this. The assessee responded that the statement of
profit of capital gain shown by M/s IFS Securities is incorrect. AO
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did not accept the same. Hence, he made the addition of short term
capital gain of Rs. 1,44,529/-.
9. Upon assessee's appeal Ld. CIT(A) deleted the addition holding
as under:-
"Regarding the addition of RS.1,44,529/- on a/c of Short
Term Gain on sale of shares the AO had ignored the
second letter issued by M/s ISF Securities dated
25.11.2011 regarding the transaction with the appellant.
The appellant has also submitted a confirmation
statement of account of the broker and the copy of
Demat Account to corroborate the transaction. These
statement was also filed with the AO at assessment stage
but AO had ignored all these facts. In view of the above,
the addition made by the AO of RS.1 ,44,529/- is hereby
deleted."
10. Against the above order the Revenue is in appeal before us.
11. Ld. DR submitted that assessee has not submitted cogent
reply before the AO. Assessee has submitted the second letter
issued by M/s IFS Securities and confirmation of the statement of
account of the brokers and copy of DMAT account etc. before the
Ld. CIT(A). It was contended before the Ld. CIT(A) that these
submissions were filed before the AO at the assessment stage, but
AO did not ignore all these facts. In this view of the matter, Ld.
CIT(A) deleted the addition of Rs. 1,44,529/-. In this regard, Ld. DR
pleaded that Ld. CIT(A) has believed the submissions of the
assessee without checking out the same from the AO. In these
circumstances, he pleaded that this issue may also be
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remitted to the file of the AO to consider the same afresh. Ld.
Counsel of the assessee relied the order of the Ld. CIT(A).
12. Upon careful consideration, we are of the opinion that this
issue also needs to be remitted to the file of the AO to consider the
issue afresh, in light of the submissions of the assessee before the
Ld. CIT(A). We hold and direct accordingly.
13. In the result, the appeal filed by the Revenue stands allowed
for statistical purposes.
Order pronounced in the Open Court on 23/4/2014, upon
conclusion of hearing.
Sd/- Sd/-
TOLANI]
[R.P. TOLANI] [SHAMIM YAHYA]
JUDICIAL MEMBER ACCOUNTANT MEMBER
Date 23/4/2014
"SRBHATNAGAR"
Copy forwarded to: -
1. Appellant -
2. Respondent -
3. CIT
4. CIT (A)
5. DR, ITAT
TRUE COPY
By Order,
Assistant Registrar,
ITAT, Delhi Benches
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