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April, 28th 2014
                                                       ITA NO. 3345/Del/2013

                    DELHI BENCH "E", NEW DELHI

                        I.T.A. No. 3345/DEL/2013
                               A.Y. : 2009-10
ITO, WARD 42(4),             VS.                   SMT. NANDITA
NEW DELHI                                          GUPTA,
                                                   B-10, HOUSING
                                                   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

     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

                                                        ITA NO. 3345/Del/2013

     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:-

                                                   ITA NO. 3345/Del/2013

          "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
                                                            ITA NO. 3345/Del/2013

          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.

                                                          ITA NO. 3345/Del/2013

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

                                                                   ITA NO. 3345/Del/2013

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

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

                                                     ITA NO. 3345/Del/2013

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/-

 [R.P. TOLANI]                                    [SHAMIM YAHYA]
JUDICIAL MEMBER                               ACCOUNTANT MEMBER

Date 23/4/2014
Copy forwarded to: -
1.    Appellant -

2.    Respondent -
3.    CIT
4.    CIT (A)
5.    DR, ITAT

                            TRUE COPY
                                                  By Order,

                                                  Assistant Registrar,
                                                  ITAT, Delhi Benches

    ITA NO. 3345/Del/2013

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