The ITO, Ward-2,, Bharuch v. Shri Vakhatsingh B.Raj, Bharuch

ITA 112/AHD/2010 | 1999-2000
Pronouncement Date: 11-02-2010 | Result: Allowed

Appeal Details

RSA Number 11220514 RSA 2010
Assessee PAN AIUPR9373B
Bench Ahmedabad
Appeal Number ITA 112/AHD/2010
Duration Of Justice 30 day(s)
Appellant The ITO, Ward-2,, Bharuch
Respondent Shri Vakhatsingh B.Raj, Bharuch
Appeal Type Income Tax Appeal
Pronouncement Date 11-02-2010
Appeal Filed By Department
Order Result Allowed
Bench Allotted SMC
Tribunal Order Date 11-02-2010
Assessment Year 1999-2000
Appeal Filed On 12-01-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH SMC AHMEDABAD BEFORE SHRI I.S. VERMA JUDICIAL MEMBER I.T.A. NO. 104/AHD/2010 - AY 1991-92 I.T.A. NO. 105/AHD/2010 - AY 1992-93 I.T.A. NO. 106/AHD/2010 - AY 1993-94 I.T.A. NO. 107/AHD/2010 - AY 1994-95 I.T.A. NO. 108/AHD/2010 - AY 1995-96 I.T.A. NO. 109/AHD/2010 - AY 1996-97 I.T.A. NO. 110/AHD/2010 - AY 1997-98 I.T.A. NO. 111/AHD/2010 - AY 1998-99 I.T.A. NO. 112/AHD/2010 - AY 1999-00 I.T.A. NO. 113/AHD/2010 - AY 2000-01 I.T.A. NO. 114/AHD/2010 - AY 2001-02 I.T.A. NO. 115/AHD/2010 - AY 2002-03 I.T.A. NO. 116/AHD/2010 - AY 2003-04 ITO WD.2 VS SHRI JASBHA VAKHATSINGH BHARUCH L/H LATE SHRI VAKHATSINGH B RAJ AT : VATAMA TAL : VAGRA DIST : BHARUCH PAN : AIUPR9373B (APPELLANT) (RESPONDENT) APPELLANT BY : SMT. NEETA SHAH RESPONDENT BY: SHRI DK PARIKH O R D E R ALL THESE APPEALS BY THE REVENUE ARE AGAINST THE C OMMON ORDER OF THE CIT(A)-VI BARODA DATED 05 TH OCTOBER 2009 FOR THE ASSESSMENT YEARS 1991-92 TO 2003-04 AND THE COMMON GROUNDS TAKEN AS UNDER: 1(I) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LEARNED CIT(A ERRED IN DIRECTING THAT THE NET TAXABLE SHARES OF THE CO-OWNERS (AFTER ALLOWING FOR THE EXE MPTION LIMIT) MAY BE CLUBBED IN THE HANDS OF THE ASSESSEE AND TAXED ACCORDINGLY. THE CIT(A) FURTHER ERRED IN DIR ECTING TO GIVE CREDIT FOR THE TDS PROPORTIONATELY IN RESPECTI VE YEARS. 1(II) THE DECISION OF LD.CIT(A) IS NOT ACCEPTABLE B ECAUSE THERE IS NO SUCH PROVISION IN THE I.T. ACT 1961 TO CLUB THE INCOME OF ITA NOS 104 TO 116/AHD/2010 2 OTHER PERSONS IN THE HANDS OF AN ASSESSEE EXCEPT FO R THE MINOR SON OR DAUGHTER. 2. THESE APPEALS WERE ORIGINALLY FIXED FOR HEARING ON 10-02-2010. HOWEVER AT THE TIME OF HEARING THE LEARNED COUNSEL FOR THE ASSESSEE BROUGHT TO MY NOTICE THAT THE ASSESSEE IN WHOSE NAME THESE APPEALS HAVE BEEN FILED HAS EXPIRED ON 1`5-11-2008 AND THEREFORE THE NAME OF HIS LEGAL HE IR SHRI JASBHA VAKHATSINGH MAY BE SUBSTITUTED FOR LATE SHRI VAKHATSINGH B RAJ. COPY OF THE DEATH CERTIFICATE IS FILED ON RECORD. THEREFORE IN VIEW OF THE AGRE EMENT BETWEEN THE LD.AR AND LD.DR THESE APPEALS WERE ADJOURNED TO 11-02-2010 A ND ISSUE NOTICE OF HEARING WERE ISSUED IN THE NAME OF SHRI JASBHA VAKHATSINGH L/H OF SHRI VAKHATSINGH B RAJ. 3. PARTIES HAVE BEEN HEARD. THE LEARNED DR AT THE OUTSET CHALLENGED THE DIRECTIONS / OBSERVATIONS OF THE FINDINGS OF THE CI T(A) CONTAINED AT PARAGRAPH 4.2.1 OF HIS ORDER WHEREAT HE HAS STATED AS BELOW: 4.2.1.. LOOKING INTO THE PECULIAR CIRCUMSTANCE S AND ACCEPTING THE PLEA OF THE APPELLANT THE NET TAXABL E SHARES (AFTER ALLOWING FOR THE EXEMPTION LIMIT) OF THE CO-OWNERS IN VARIOUS YEARS MAY BE CLUBBED IN THE HANDS OF PADMABEN AND TAXED A CCORDINGLY. THE A.O. IS ACCORDINGLY DIRECTED TO TAX THE PROPORT IONATE SHARE OF SMT. PADMABEN IN VARIOUS YEARS AND ALSO THE TAXABLE COMPONENT OF INTEREST INCOME OF OTHER CO-OWNERS FOR EACH YEAR AND ALSO GIVE CREDIT FOR THE TDS PROPORTIONATELY IN RESPECTIVE YE ARS. ACCORDING TO THE LD DR THE CIT(A) HAVING OBSERVED I N THE EARLIER PART OF PARAGRAPH 4.2.1 TO THE EFFECT THAT AS PER INCOME-T AX ACT THE INCOME OF OTHER PERSON CANNOT BE CLUBBED IN THE HANDS OF THE APPELL ANT (EXCEPT FOR THE MINOR SON OR DAUGHTER) SHOULD NOT HAVE GIVEN A FINDING FOR C LUBBING OF THE INCOME OF OTHER CO-OWNERS IN THE HANDS OF LATE SHRI VAKHATSINGH B R AJ L/H SHRI JASBHA VAKHATSINGH BECAUSE LAW DOES NOT PERMIT SUCH AN ACT ION. IT WAS FURTHER SUBMITTED THAT THE ORDER OF THE CIT(A) IN THIS RESP ECT IS THEREFORE AGAINST THE STATUTE BECAUSE INCOME-TAX CAN BE CHARGED ONLY BY M AKING AN ASSESSMENT OF THE PERSON TO WHOM THE INCOME BELONGS AND NOT BY TA XING THE INCOME BELONGING ITA NOS 104 TO 116/AHD/2010 3 TO ONE PERSON IN THE HANDS OF ANOTHER PERSON. HAVI NG SAID SO THE LEARNED DEPARTMENTAL REPRESENTATIVE WANTED TO REFER TO OBSE RVATIONS OF THE ASSESSING OFFICER ON PAGES 5 & 7 WHEREIN HE HAS OBSERVED THAT THERE IS NO EVIDENCE THAT THE TDS CERTIFICATE WAS IN THE NAME OF CO-OWNERS AND AL SO THAT THE COMPENSATION WAS GRANTED IN THE NAME OF CO-OWNERS. IT WAS THERE FORE SUBMITTED THAT THE ORDER OF THE CIT(A) MAY BE REVERSED WITH RESPECT TO ISSUE S RAISED IN THE GROUNDS TAKEN BY THE REVENUE. 4. THE LD AR ON THE OTHER HAND FIRST OF ALL OBJECTE D TO THE LD DRS REFERENCE TO OBSERVATIONS ON PAGES 5 & 7 OF THE ASSESSING OFFICE RS ORDER (SUPRA) BY SUBMITTING THAT THE ISSUE CONSIDERED BY THE ASSESSI NG OFFICER IS NOT SUBJECT MATTER OF PRESENT APPEALS AND THEREFORE THE QUESTION AS T O WHETHER THE TDS CERTIFICATE WAS IN THE NAME OF CO-OWNERS OR NOT OR AS TO WHETHE R COMPENSATION WAS GRANTED TO THE CO-OWNERS IS NOT FOR THE CONSIDERATION OF TH E TRIBUNAL. 4.1 HAVING SAID AS ABOVE THE LD AR FURTHER SUBMITT ED THAT SO FAR AS THE TAXABILITY OF INTEREST IN THE HANDS OF ANY OF THE C O-OWNERS INDIVIDUALLY OR IN THE HANDS OF ONE PERSON IN CONCERNED THE HONBLE SUPRE ME COURT IN THE LATEST CASE OF CIT VS GANSHYAM HUF 315 ITR 1 (SC) HAS LAID DOWN THE PROPOSITION THAT INTEREST GRANTED ON ENHANCED COMPENSATION IS INTERE ST GRANTED U/S 28 OF THE LAND ACQUISITION ACT AND THEREFORE THE SAME IS PA RT OF ENHANCED COMPENSATION WHEREAS INTEREST GRANTED FOR DELAY IN PAYMENT OF CO MPENSATION (U/S 34 OF THE LAND ACQUISITION ACT) IS THE INTEREST U/S 34 OF THE LAND ACQUISITION ACT. IN VIEW OF THIS PROPOSITION OF LAW LAID DOWN BY THE HONBLE SU PREME COURT THE LD.AR FURTHER SUBMITTED THAT SO FAR AS THE PRESENT CASES ARE CONC ERNED THE INTEREST UNDER DISPUTE HAS BEEN ALLOWED ON ENHANCED PART OF COMPEN SATION AND THEREFORE FALLS WITHIN THE INTEREST ALLOWABLE U/S 28 OF THE LAND AC QUISITION ACT WHICH IN TURN AS HAS BEEN HELD BY THE HONBLE SUPREME COURT IN THE C ASE OF GANSHYAM HUF (SUPRA) FORMS PART OF ENHANCED COMPENSATION. IT W AS THEREFORE SUBMITTED THAT THE ASSESSEES LAND BEING AGRICULTURAL LAND AND SIT UATED OUTSIDE 8 KILOMETERS FROM THE LIMIT OF BHARUCH MUNICIPALITY THE ENHANCE D COMPENSATION ON ACQUISITION ITA NOS 104 TO 116/AHD/2010 4 OF AGRICULTURAL LAND ITSELF WAS NOT TAXABLE MEANING THEREBY THAT THE INTEREST WHICH IS SUBJECT MATTER OF APPEALS BEFORE THE TRIBUNAL WA S EXEMPT FROM TAX AND PLEADED THAT THE ORDER OF THE CIT(A) MAY BE QUASHED . 5. HAVING CONSIDERED THE RIVAL SUBMISSIONS AND THE FACTS AND CIRCUMSTANCES OF THE CASE I AM OF THE OPINION THAT SO FAR AS THE OBSERVATION OF THE CIT(A) IN THE LATER PART OF PARAGRAPH 4.2.1 WHICH ARE OBJECTED T O BY THE LD.DR ARE CONCERNED ARE NOT SUSTAINABLE IN LAW AS WELL AS ON FACTS. SO FAR AS RELIANCE OF THE LD.DR ON THE OBSERVATIONS OF THE ASSESSING OFFICER ON PAGES 5 & 7 OF THE ASSESSMENT ORDER ARE CONCERNED THE REVENUE HAVING BEEN NOT RAISED A NY GROUND WITH RESPECT TO THESE ISSUES THE REFERENCE OF THE LD.DR IS OF NO U SE. 6. COMING TO THE SUBMISSION OF THE LD.AR I AFTER HAVING GONE THROUGH THE ORDER OF THE CIT(A) CONSIDER IT JUSTIFIED AND IN TH E INTEREST OF BOTH THE PARTIES THAT THE ISSUE RELATING TO TAXABILITY OF INTEREST REQUIR ES RE-CONSIDERATION AT THE HANDS OF THE CIT(A) ESPECIALLY IN THE LIGHT OF LATEST DECISI ON OF THE HONBLE SUPREME COURT (SUPRA). CONSEQUENTLY THE ISSUE RELATING TO TAXAB ILITY OF THE INTEREST IN ALL THESE CASES IS RESTORED BACK TO THE CIT(A) WITH THE DIRE CTIONS THAT HE SHALL DECIDE THIS ISSUE AFRESH IN ACCORDANCE WITH LAW KEEPING IN VIEW THE AFORESAID DECISION OF THE SUPREME COURT. BOTH THE PARTIES SHALL HOWEVER B E GIVEN A PROPER OPPORTUNITY OF BEING HEARD. 7. THE CONSOLIDATED ORDER OF THE CIT(A) IS THEREFO RE SET ASIDE AND REVENUES APPEALS ARE ALLOWED FOR STATISTICAL PURPOSES. 8. ORDER PRONOUNCED ON THIS 11 TH DAY OF FEBRUARY 2010. SD/- (I.S. VERMA) JUDICIAL MEMBER AHMEDABAD DT : 11 TH FEBRUARY 2010 PK/- ITA NOS 104 TO 116/AHD/2010 5 COPY TO: 1. THE ASSESSEE 2. THE REVENUE 3. THE CIT(A)-VI BARODA 4. THE CIT-III BARODA BY ORDER 5. THE DR SMC BENCH (TRUE COPY) DEPUTY REGISTRAR ITAT AHMEDABAD