K.Siva Reddy(Huf), Secunderabad v. ITO, Secunderabad

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B HYDERABAD BEFORE SHRI N.R.S. GANSAN JUDICIAL MEMBER AND SHRI CHANDRA POOJARI ACCOUNTANT MEMBER ITA-696/HYD/2006 ASST. YEAR : 2001-2002 ITA-697/HYD/2006 2002-2003 ITA-698/HYD/2006 2003-2004 LATE K. SIVA REDDY (HUF) SECUNDERABAD (PAN AALH S5118 Q) VS ITO RANGE 11(4) SECUNDERABAD (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI S. RAMA RAO RESPONDENT BY : SHRI E.S. NAGENDRA PRASAD O R D E R PER N.R.S. GANESAN JUDICIAL MEMBER ALL THESE THREE APPEALS HAVE BEEN FILED BY THE ASSE SSEE ARE DIRECTED AGAINST THE COMMON ORDER PASSED BY THE CIT(A)-V I HYDERABAD DATED 22.3.2006 AND PERTAINS TO ASSESSMENT YEARS 2001-20 02 2002-03 AND 2003-04. SINCE COMMON ISSUES ARISE FOR CONSIDERATION I N ALL THESE APPEALS WE HAVE HEARD THE SAME TOGETHER AND DISPOSING OFF THE SAME BY THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. 2. THE ONLY ISSUE ARISES FOR CONSIDERATION IN THESE THR EE APPEALS IS COMPUTATION OF CAPITAL GAIN. 3. SHRI RAMA RAO LEARNED COUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT THE ASSESSEE INHERITED A PIECE OF LAND IN SURVEY NO.105 SITUATED AT KOMPALLY QUTBULLAUR MANDAL RANGA REDDY DISTRICT ALONG WITH OTHER PROPERTIES FROM HIS FATHER SHRI K. RAMI RE DDY. ACCORDING TO 2 THE LEARNED COUNSEL A PORTION OF THE LAND WAS USED FOR CONSTRUCTION OF COMMERCIAL COMPLEX. THE BALANCE LAND MEASURING ABOUT 24 80 SQ. YARDS WAS GIVEN FOR DEVELOPMENT TO M/S SHRI SAI SARAN BUILD ERS. ACCORDING TO THE LEARNED COUNSEL THE FIRST DEVELOPMENT AGREEMENT WAS EXECUTED ON 27.8.1998 FOR CONSTRUCTION OF AN APARTMENT CALLED EMER ALD RESIDENCY BLOCK A ON A PORTION OF THE SAID VACANT LAND TO THE EXTENT OF 1240 SQ. YARDS. ACCORDING TO THE LEARNED COUNSEL THIS DEVELOPME NT AGREEMENT WAS EXECUTED BETWEEN THE ASSESSEE AND 8 OTHERS INCLUDING M INOR CO- OWNERS ON ONE PART AND THE BUILDER SHRI SAI SARAN BU ILDERS ON ANOTHER PART. ACCORDING TO THE LEARNED COUNSEL THE ASSESSEE HAS A LSO ENTERED INTO A CO-OWNERSHIP AGREEMENT ON 30.8.1999 IN RESPECT OF 1240 SQ. YARDS OF LAND WHICH WAS GIVEN FOR DEVELOPMENT FOR CON STRUCTION OF EMERALD RESIDENCY BLOCK B THE ASSESSEE HAS TAKEN A LOAN TO DEVELOP THE VERY SAME PROPERTY. 4. THE LEARNED COUNSEL EXPLAINED THAT THE LAND WAS A BIG PIT AND TOTAL LOOSE SOIL AND UNFIT FOR ANY CONSTRUCTION. T HEREFORE THE ASSESSEE BY RAISING FUNDS FILLED UP THE PIT AND MADE THE LAND INTO NORMAL CONDITION FOR THE PURPOSE OF DEVELOPING THE SAME AND T O CONSTRUCT BUILDING THEREON. HOWEVER THE ASSESSEE COULD NOT RE-PAY THE AMOUNT BORROWED FOR THE PURPOSE OF DEVELOPMENT OF THE LAND. THEREFORE THE ASSESSEE ENTERED INTO A CO-OWNERSHIP AGREEMENT ON 30.8.19 99 AND THEREBY TAKEN THE EIGHT PERSONS WHO ARE ALL CLOSE RELAT IVES OF THE ASSESSEE AS CO-OWNERS OF THE LAND. THEREAFTER THE ASSESSEE E NTERED INTO A DEVELOPMENT AGREEMENT FOR CONSTRUCTING A MULTI STORIED RESIDENTIAL COMPLEX. 5. THE LEARNED COUNSEL FURTHER SUBMITTED THAT THERE ARE CERTAIN MINORS WHO ARE TAKEN AS CO-OWNERS IN RESPECT OF 1240 SQ. YARDS LAND. THE RESPECTIVE GUARDIANS OF THE MINORS APPROACHED THE PR INCIPAL DISTRICT JUDGE RR DISTRICT FOR PERMISSION TO SELL THEIR PORTION OF 1/9 TH SHARE OF 3 THEIR PROPERTY. THE PRINCIPAL DISTRICT JUDGE BY AN ORD ER DATED 27.12.1999 PERMITTED GUARDIANS OF THE MINORS TO SELL T HEIR SHARE OF LAND AND DEPOSIT THE SALE PROCEEDS IN A FIXED DEPOSIT IN ANY ONE OF THE SCHEDULED BANK TILL THE MINORS ATTAIN THEIR RESPECTIVE A GES OF MAJORITY. THE LEARNED COUNSEL FURTHER SUBMITTED THAT THE CO-OWNER SHIP AGREEMENT AND DEVELOPMENT AGREEMENT THOUGH EXECUTED ON 30.8.19 99 AND 28.7.1998 RESPECTIVELY BOTH THE AGREEMENTS CAME INTO E FFECT ON 1.7.1998. ACCORDING TO THE LEARNED COUNSEL THE ASSESSING OFFICER HAS NOT DOUBTED THE DEVELOPMENT AGREEMENT THEREFORE HE CANNOT DOUBT THE EFFECTIVE DATE OF THE CO-OWNERSHIP AGREEMENT FROM 1.7. 1998. THEREFORE ACCORDING TO THE LEARNED COUNSEL IN VIEW OF THE CO-OWNERSHIP AGREEMENT ONLY 1/9 TH SHARE OF THE PROFIT ON SALE OF 1240 SQ. YARDS LAND IS TO BE ADDED IN THE HANDS OF THE ASSESSEE AND REMAININ G 8/9 TH SHARE SHALL BE ADDED IN THE CO-OWNERS. THEREFORE THE ASSESSME NT OF THE ENTIRE PROFIT ON SALE OF LAND IN THE HANDS OF THE ASSESSE E IS NOT JUSTIFIED. IN RESPECT OF THE SECOND DEVELOPMENT AGREEMENT ALSO THE TERMS AND CONDITIONS ON THE CO-OWNERSHIP REMAINED THE SAME. ALL T HE CO-OWNERS HAS SHOWN THE EXPENDITURE IN THEIR RESPECTIVE HANDS IN RESPECT OF SECOND DEVELOPMENT AGREEMENT WHICH WAS KNOWN AS EMERALD RESIDENCY BLOCK B. FURTHER HE POINTED OUT THAT THE ASSESSING OFF ICER REJECTED THE CLAIM OF THE ASSESSEE MAINLY ON THE GROUND THAT THE CO-OW NERSHIP AGREEMENT WAS NOT REGISTERED AS REQUIRED UNDER THE REG ISTRATION ACT. ACCORDING TO THE LEARNED COUNSEL REGISTRATION OF LAND U NDER THE REGISTRATION ACT MAY NOT BE A RELEVANT FACTOR UNDER T HE INCOME TAX ACT FOR ASSESSMENT OF INCOME. SINCE THE CO-OWNERS JOINTLY SOLD THEIR SHARES OF CONSTRUCTED PROPERTY BY EXECUTING VARIOUS REGISTERED SA LE DEED IN FAVOUR OF PROSPECTIVE BUYERS. ACCORDING TO THE COUNSEL THE ENTIRE CAPITAL GAIN HAS TO BE ASSESSED IN THE HANDS OF 9 PERSONS I NCLUDING THE ASSESSEE. FURTHER HE SUBMITTED THAT THE ASSESSING OFFICER HA S DISBELIEVED THE DEVELOPMENT MADE BY THE ASSESSEE AFTER B ORROWING 4 FUNDS FROM CO-OWNERS AND ASSESSED THE ENTIRE PROFIT WITHOU T ALLOWING THE EXPENDITURE ON DEVELOPMENT AS CAPITAL GAIN. 6. ON THE CONTRARY THE LEARNED DEPARTMENTAL REPRE SENTATIVE SHRI E. NAGENDRA PRASAD SUBMITTED THAT THE LANDED PRO PERTY SITUATED AT KOMPALLY ORIGINALLY BELONGS TO SHRI RAMI REDDY FATHE R OF THE ASSESSEE. ON THE DEATH OF SHRI RAMI REDDY THE ASSESSEE INHERITED THE ABOVE SAID PROPERTY ALONG WITH OTHER PROPERTIES. LATE SHRI SIV A REDDY CONSTRUCTED A COMMERCIAL COMPLEX ON A PORTION OF THE LAND AND SHOW N THE INCOME FOR THE ASSESSMENT YEAR 1997-98 AND BALANCE LAND 2480 SQ. YARDS WAS GIVEN FOR DEVELOPMENT THROUGH TWO DEVELOPMENT AGREE MENTS. THE FIRST DEVELOPMENT AGREEMENT WAS EXECUTED BETWEEN THE ASSESSEE AND 8 OTHERS ON ONE PART AND SHRI SAI SARAN BUILDERS ON THE OTHER PART FOR CONSTRUCTION OF RESIDENTIAL COMPLEX KNOWN AS EMERALD RESID ENCY BLOCK A. THE FIRST AGREEMENT WAS EXECUTED ON 27.8.1998. TH E SECOND AGREEMENT WAS ALSO EXECUTED IN RESPECT OF REMAINING 1240 SQ.YARDS FOR CONSTRUCTION OF RESIDENTIAL COMPLEX KNOWN AS EMERALD RESID ENCY BLOCK B. THE SECOND AGREEMENT WAS EXECUTED ONLY BY THE ASSESSEE. THE ASSESSEE ALSO EXECUTED A CO-OWNERSHIP AGREEMENT ON 30.8.1 999 IN RESPECT OF EMERALD RESIDENCY BLOCK A. ACCORDING TO THE RE PRESENTATIVE IN RESPECT OF EMERALD RESIDENCY BLOCK B THERE WAS NO CO-O WNERSHIP AGREEMENT. REFERRING TO THE ASSESSMENT ORDER WHERE TH E ASSESSING OFFICER EXPLAINED THE FAMILY TREE OF THE ASSESSEE THE L EARNED DEPARTMENTAL REPRESENTATIVE POINTED OUT THAT THE ASSESSE E IS THE ONLY SON OF SHRI RAMI REDDY. THE ASSESSEE HAS TWO DAUGHTERS. THE FIRST DAUGHTER SWAPNA RANI AND THE SECOND DAUGHTER NIRAJA. THE SO CALLED CO-OWNERS ARE MINOR CHILDREN OF THE ASSESSEES DAUGHTER AN D SON IN LAWS. REFERRING TO THE ASSESSMENT ORDER THE DR POINTED OUT THAT THE ASSESSING OFFICER EXAMINED THE CO-OWNERSHIP AGREEMENT AND FOUND THAT THE CO-OWNERSHIP AGREEMENT SUFFERS FROM LEGAL INFIRMIT IES AND IT WAS ONLY TAX AVOIDANCE DEVICE TO DIVERT INCOME BY OVER RI DING AND EVADING 5 TAX. THE LEARNED DEPARTMENTAL REPRESENTATIVE FURTH ER POINTED OUT THAT THE PROPERTY CAN BE ALIENATED ONLY FOR LEGAL NECESSITIE S WITH THE KNOWLEDGE OF THE OTHER CO-OWNERS. 7. IN THIS CASE THE LEARNED DEPARTMENTAL REPRESENTAT IVE SUBMITTED THAT THERE WAS NO LEGAL NECESSITY FOR TRANSFER OF HUF PROPERTY. THE LEARNED REPRESENTATIVE FURTHER POINTED OUT THAT THERE WAS NO EVIDENCE TO SHOW THAT THE INCOME FROM PROPERTY WAS ACTUA LLY PASSED ON TO CO-OWNERS. THEREFORE ACCORDING TO THE LEARNED REPR ESENTATIVE THE ENTIRE PROFIT ARISING OUT OF THE TRANSFER OF THE LAND HAS TO BE ASSESSED ONLY IN THE HANDS OF THE ASSESSEE. SINCE THE ASSESSEE HAS NO T PRODUCED ANY EVIDENCE FOR DEVELOPMENT OF THE LAND; THE ASSESSING OFFICER HAS RIGHTLY DISALLOWED THE EXPENDITURE CLAIMED BY THE ASSESS EE ON THE SO CALLED DEVELOPMENT. SINCE THE CO OWNERS AGREEMENT IS NO T ACTED UPON AND THE ASSESSEE HAS NOT PRODUCED ANY EVIDENCE FOR DEVELO PMENT OF THE PROPERTY THE ASSESSING OFFICER HAS RIGHTLY COMPUTED THE CA PITAL GAIN WHICH WAS CONFIRMED BY THE CIT(A). THE LEARNED DR PLA CED RELIANCE ON THE JUDGMENT OF THE MADRAS HIGH COURT IN THE CASE OF IT O VS. K. JAYARAM (1986) (MAD. HC) (168 ITR 757) AND SUBMITTED THE ASSESSING OFFICER CAN GO INTO THE QUESTION OF VALIDITY AND GENUI NENESS OF THE DOCUMENTS PRODUCED BEFORE HIM. THE LEARNED DR ALSO PLA CED RELIANCE ON THE JUDGEMENT IN THE CASE OF A K BABU KHAN VS. CIT (AP HC) (1974) 102 ITR 757 AND SUBMITTED THAT THE ADDITIONAL EVIDENCE FILED BY THE ASSESSEE FOR THE EXPENDITURE SAID TO BE INCURRED FOR DEVELOPMENT OF LAND CANNOT BE ADMITTED AT THIS STAGE. 8. WE HAVE CONSIDERED RIVAL SUBMISSIONS ON EITHER SIDE AND ALSO PERUSED THE MATTER AVAILABLE ON RECORD. ADMITTED LY THE LANDED PROPERTY LOCATED AT 105 KOMPALLY WAS ORIGINALLY BELO NGED TO SHRI RAMI REDDY FATHER OF THE ASSESSEE. ON DEATH OF SHRI RAM RE DDY THE ASSESSEE INHERITED THE SAME ALONG WITH OTHER PROPERTIES. THE ASSESSEE 6 LATE SHRI K. SIVA REDDY DIED ON 15.9.2004. DURING HIS LIFE TIME HE CONSTRUCTED A COMMERCIAL COMPLEX IN A PORTION OF THE LAND AND FILED RETURN OF INCOME FOR THE ASSESSMENT YEAR 1997-98. THE B ALANCE LAND OF 2480 SQ. YARDS WAS GIVEN FOR DEVELOPMENT TO ONE MR. S AI SARAN BUILDERS A PARTNERSHIP FIRM FOR DEVELOPMENT BY WAY OF TWO DEV ELOPMENT AGREEMENTS. THE FIRST AGREEMENT WAS EXECUTED ON 27.8.1 998 FOR CONSTRUCTION OF A PORTION OF THE LAND TO THE EXTENT 12 40 SQ. YARDS BETWEEN LATE SHRI K. SIVA REDDY AND 8 OTHERS ON THE ONE PART AND SHRI SAI SARAN BUILDERS ON THE OTHER PART. A SECOND AGRE EMENT WAS EXECUTED ON 3.4.2002 FOR CONSTRUCTION OF BLOCK B EMERALD RESIDENCY IN RESPECT OF THE REMAINING 1240 SQ. YARDS. THIS AGREEMEN T WAS EXECUTED BETWEEN LATE SHRI K. SIVA REDDY AND THE SAME BUILDER SHRI SAI SARAN BUILDERS. THE ASSESSEE CLAIMED THAT THE SECOND AGREEMENT W AS ALSO EXECUTED BY THE ASSESSEE ON BEHALF OF HIMSELF AND 8 OTHE R CO-OWNERS. FURTHER THE DR CLAIMS THAT THE SECOND AGREEMENT DATED 3.4.2002 WAS EXECUTED ONLY BETWEEN SHRI SIVA REDDY AND THE BUILDE R. 9. LET US FIRST EXAMINE THE FIRST DEVELOPMENT AGREEM ENT EXECUTED BETWEEN THE ASSESSEE SHRI K. SIVA REDDY AND 8 O THER CO- OWNERS AND THE BUILDER SHRI SAI SARAN BUILDERS. THE LEARNED DR BY REFERRING TO THE JUDGEMENTS MADRAS HIGH COURT CITED SUP RA CLAIMS THAT THEY CAN GO INTO THE VALIDITY OF THE CO-OWNERSHIP AGRE EMENT. THE ASSESSING OFFICER AFTER EXAMINING THE CO-OWNERSHIP AGREEME NT FOUND THAT THE CO-OWNERSHIP AGREEMENT WAS NOT LEGALLY EXECUTE D FOR FAMILY NECESSITIES AS REQUIRED UNDER HINDU LAW. THEREFORE IT WA S NOT ACTED UPON. WE HAVE CAREFULLY GONE THROUGH THE CO-OWNERSHI P AGREEMENT SAID TO BE EXECUTED AND THE DEVELOPMENT AGREEMENT DAT ED 28.7.1998 THE COPIES OF THE SAID DOCUMENTS ARE AVAILABLE IN THE PA PER BOOK AT PAGE 10 AND 15 RESPECTIVELY. AS PER THE CO-OWNERSHIP AGREEM ENT IT APPEARS THAT THE ASSESSEE SHRI K. SIVA REDDY BORROWED ONE LAKH FROM EACH CO- OWNER FOR THE PURPOSE OF DEVELOPMENT OF THE LAND AND HE WAS NOT IN A 7 POSITION TO REPAY THE INTEREST AND PRINCIPAL AMOUNT. THEREFORE HE AGREED TO TAKE THE 8 CREDITORS AS CO-OWNERS. 10. THE ISSUE ARISES FOR CONSIDERATION IS WHETHER THE PROFIT ARISING OUT OF THE SALE OF THE PROPERTY WAS DIVERTED BY OVERRIDING TITLE OR IT IS ONLY AN APPLICATION/DISTRIBUTION OF INCOME. THE CLAIM OF THE ASSESSEE IS THAT THE LANDED PROPERTY WAS DEVELOPED TO MAK E IT FIT FOR CONSTRUCTION. THE REVENUE AUTHORITIES EXAMINED THE PAR TNERS OF M/S SAI SARAN BUILDERS WHO HAPPENS TO BE BROTHERS SON OF LATE SHIVA REDDY. THE PARTNER OF SHRI SAI SARAN BUILDERS CLARIFIED BEFO RE THE REVENUE AUTHORITIES THAT HE KNOWS THE SAID LAND FROM HIS CHILD HOOD AND THE LAND WAS USED FOR AGRICULTURE LATER ON IN THE YEAR 1999 IT WAS GIVEN TO HIM FOR DEVELOPMENT. M/S SAI SARAN BUILDERS SPENT MONEY T O MAKE THE LAND SUITABLE FOR CONSTRUCTION. HE ALSO CLARIFIED THAT LATE S HIVA REDDY HAS NOT MADE ANY INVESTMENT OR INCURRED ANY EXPENDITURE ON TH IS LAND FOR DEVELOPMENT BEFORE GIVING THE SAME TO M/S SAI SARAN B UILDERS. IN FACT THE PARTNER HAS STATED AS FOLLOWS. DURING THE COURSE OF EXAMINATION REGARDING EXPENDITURE ON DEVELOPMENT OF LAND IT IS TO SUBMIT THAT THIS LAND BELONGS TO LATE SHIVA REDDY MY FATHERS ELDER BROTHER. I KNOW THIS LAND FROM MY CHILDHOOD. THE LAND WAS USED FOR AGRICULTURE LATE R ON IN THE YEAR 1999 IT WAS GIVEN TO ME FOR DEVELOPMENT AS IT IS WITHOUT WO RK DONE ON IT WHEN IT WAS GIVEN TO US. WE HAVE SPENT TO MAKE THE LAND SUITABLE FOR CONSTRUCTION. LATE SHIVA REDDY HAS NOT MADE ANY INVESTMENT OR INCURRED ANY EXPENDITURE ON THIS LAND AS THE LAND WAS GIVEN TO US AS ON AS IT IS. 11. IN VIEW OF THE STATEMENT OF THIS PARTNER WHO IS NONE OTHER THAN THE BROTHERS SON OF SHIVA REDDY IT IS VERY CLEA R THAT SHIVA REDDY WAS NOT INCURRED ANY EXPENDITURE FOR DEVELOPMENT OF THE LAND IN QUESTION. THEREFORE THE XEROX COPY OF THE DEBIT VOU CHERS CLAIMING IT TO BE THE EXPENDITURE INCURRED FOR DEVELOPMENT OF LAND IS ONLY SELF SERVING DOCUMENT IT MAY NOT BE OF ANY ASSISTANCE TO THE ASSESSEE. NOW COMING TO THE BORROWAL OF LOAN THE ASSESSEE CLAIMS THAT THE LOA NS WERE BORROWED FROM 8 PERSONS FOR INVESTING THE SAME IN THE L AND FOR DEVELOPMENT. IN VIEW OF THE EVIDENCE AVAILABLE ON RECORD IT IS CLEAR 8 THAT NO EXPENDITURE WAS INCURRED FOR DEVELOPMENT OF T HE LAND. IN THOSE CIRCUMSTANCES IT MAY NOT BE IN CORRECT IN SAYING THAT THE ASSESSEE HAS BORROWED LOAN FOR DEVELOPMENT OF THE LAND. THERE I S NO OTHER MATERIAL AVAILABLE ON RECORD TO SUGGEST THAT THE ASSESSEE HAS BORR OWED THE LOAN AND UTILIZED THE SAME FOR DEVELOPMENT OF THE LAND. IN THOSE CIRCUMSTANCES THE REASONS GIVEN BY THE ASSESSEE FOR EXECUTING A CO- OWNERSHIP AGREEMENT IS ONLY A STORY TO SUIT HIS OWN CONVE NIENCE. THEREFORE IN OUR OPINION THE CLAIM OF THE ASSESSEE TH AT THE CO- OWNERSHIP WAS EXECUTED SINCE HE COULD NOT REPAY THE BORR OWED LOAN FOR THE PURPOSE OF DEVELOPMENT IS NOT SUBSTANTIATED WITH NE CESSARY MATERIALS. THE PRINCIPAL DISTRICT JUDGE WHO PERMITTED TO SELL THE MINORS SHARE OF THE LAND HAD NO OCCASION TO ADJUDICATE ON THE B ORROWAL OF LOAN AND THE DEVELOPMENT SAID LAND BY THE ASSESSEE. IN FACT THIS ISSUE WAS NOT RAISED BEFORE THE PRINCIPAL DISTRICT JUDGE RANGA R EDDY DISTRICT. THEREFORE THE ORDER OF THE PRINCIPAL DISTRICT JUDGE R R DISTRICT GRANTING PERMISSION TO SELL THE SHARE OF THE LAND BELONGS TO THE MINORS MAY NOT BE OF ANY ASSISTANCE TO THE ASSESSEE FOR COMPUTING CAPITAL GAIN. THEREFORE IN OUR OPINION THE LOWER AUTHORITIES HAV E RIGHTLY ASSESSED THE CAPITAL GAIN IN THE HANDS OF THE ASSESSEE. DISTRIBUTION OF THE PROFITS IF ANY TO THE MINORS IS ONLY AN APPLICATION OF INCOME AND IT CANNOT BE SAID THE INCOME WAS DIVERTED BY OVERRIDING TITLE. IN VIEW OF THE ABOVE WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LOWER AU THORITIES AND ACCORDINGLY THE SAME IS CONFIRMED. 12. IN THE RESULT THE APPEAL OF THE ASSESSEE STANDS DIS MISSED. ORDER PRONOUNCED IN THE OPEN COURT : 30. 4. 201 0 SD/- SD/- (CHANDRA POOJARI) (N.R.S. GANESAN) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED THE 30 TH APRIL 2010 9 COPY FORWARDED TO: 1. SHRI S. RAMA RAO ADVOCATE C/O LATE SHRI K. SIVA REDDY (HUF) 1-12-9/3 TEMPLE ALWAL SECUNDERABAD 2. ITO RANGE 11 (4) SECUNDERABAD 3. CIT(A)- VI HYDERABAD. 4. CIT HYDERABAD 5. THE D.R. ITAT HYDERABAD. NP