COMMISSIONER OF INCOME TAX Vs. I. BASHEER

JUDGEMENT

(1.) APPEAL is filed by the Revenue challenging the order of the Tribunal allowing the appeal filed by late assessee who is now represented by son and legal heir. We have heard senior counsel appearing for the Revenue and advocate Sri. P. Balakrishnan appearing for the respondent -assessee.

(2.) THE first question raised is with regard to the validity of assessment completed under s. 147, which though confirmed by the CIT(A) in first appeal was reversed by the Tribunal for the reason that assessee had disclosed the material facts pertaining to the assessment in the original return. According to the Tribunal, based on the materials available in the original return filed, the Department could not have reopened the assessment completed under s. 143(3) of the IT Act in proceedings later initiated by issuing notice under s. 148. The facts leading to the controversy are the following.

(3.) THE assessee's 4.75 acres of land with residential building in Aluva West Village was acquired in land acquisition 1993 that is, in the previous year relevant for the asst. yr. 1994 -95, the Government had taken over possession of the reportedly taken by the Government with the consent of the assessee. The assessee was also paid advance asst. yr. 1992 -93. Even though the assessee had put a note in the return filed for the year 1992 -93 stating that the assessee had received the amount as advance compensation and part of it was deposited in the bank, assessee contended that the capital gain arising is not assessable for the asst. yr. 1992 -93. In the assessment completed under s. 143(3), the AO originally did not consider assessment on capital gains. However, the AO later issued notice under s. 148 and proceeded to assess the compensation received in land acquisition proceedings, for the asst. yr. 1992 -93. When the assessee filed appeal before the CIT(A) challenging the validity of the assessment completed under s. 147, the CIT(A) took into account the advance possession taken by the Government and advance compensation paid to the assessee in the previous year and, therefore, upheld the validity of assessment. In second appeal filed by the assessee, the Tribunal, arising on acquisition of land is not assessable for the asst. yr. 1992 -93. The Tribunal also cancelled s. 147 assessment for the reason that assessee had furnished particulars in the original return itself.