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2008 DIGILAW 154 (KAR)

Gangambika v. Income Tax Officer

2008-02-29

ANAND BYRAREDDY, DEEPAK VERMA

body2008
JUDGMENT Deepak Verma, J.— Heard Sri Y.V. Raviraj, learned Counsel for the appellant and Sri M.V. Seshachala, learned Counsel for the respondent. 2. The assessee feeling aggrieved by the order passed by the Income Tax Appellate Tribunal, Bangalore Bench "B", on April 13, 2005, in I.T.A. No. 3155/Bang/2004 for the assessment year 1997-98 is, before us by filing this appeal under Section 260A of the Income Tax Act;. 1961 (hereinafter shall be referred to in short as "the Act"), on a variety of grounds. 3. The appeal has been admitted on the following substantial questions of law: (a) Whether the Tribunal was justified in upholding the order of assessment without considering the validity of reopening of the assessment by invoking the provisions of Section 147 of the Act when no fresh facts or materials were available to the assessing authority after the completion of the assessment by issuing intimation under Section 143(1)(a) of the Act? (b) Whether, on the facts and in the circumstances of the case, the appellant can be said to be the owner of the property in its entirety to justify the assessment of the rental income from the property in her hands when there was a valid agreement of co-ownership entered into between the appellant and the other three persons to contribute capital, discharge liabilities, hold the property and enjoy the income therefrom, in equal share, in their own right and capacity as real owners of the property and for the purpose of Section 22 of the Act? (c) Whether the Tribunal was justified in not considering the binding decision of the hon'ble apex court in the cases of Commissioner of Income Tax, Bombay etc. Vs. M/s. Podar Cement Pvt. Ltd. etc., AIR 1997 SC 2523 and Union of India and Anr. Vs. Azadi Bachao Andolan and Anr., (2003) 263 ITR 706 SC which was either before them to support the claim that the co-ownership agreement has been legally and validly entered into and thus the same could not be ignored or held invalid? (d) Assuming that the entire rental income was liable to be assessed in the hands of the appellant, whether three-fourths of the rental income belonging to the other co-owners was liable to be deducted while computing the property income in the hands of the appellant under Section 24 of the Act? 4. (d) Assuming that the entire rental income was liable to be assessed in the hands of the appellant, whether three-fourths of the rental income belonging to the other co-owners was liable to be deducted while computing the property income in the hands of the appellant under Section 24 of the Act? 4. However, learned Counsel for the appellant fairly conceded that in view of the facts and features of the case, only question Nos. (b) and (d) alone would be required to be answered by us. Thus, we are not touching questions Nos. (a) and (c). 5. Before the Tribunal also, the assessee was in appeal against the order of the Commissioner of Income Tax (Appeals), Bangalore, for the assessment year 1997-98. The main grievance of the assessee in appeal was that the Commissioner of Income Tax (Appeals) ought to have appreciated that the assessee and her other three sons are the co-owners of the property and as such are entitled to receive the income from the said property in their individual right and the dual ownership of the house property with regard to the land and superstructure has been legally recognised under Section 22 of the Act. The assessee also placed reliance on the judgment of the Supreme Court in the case of Commissioner of Income Tax, Bombay etc. Vs. M/s. Podar Cement Pvt. Ltd. etc., AIR 1997 SC 2523 6. It is pertinent to mention here that for the assessment year 1996-97 similar questions had cropped up before the Tribunal and that was decided against the assessee, vide order dated March 21, 2003, in I.T.A. No. 595/Bang/2000. Against the said earlier order passed by the Tribunal between the same parties, the assessee was constrained to file I.T.A. No. 262 of 2003, in this High Court. The said appeal came up for consideration before the Bench on January 16, 2008. After recording the facts, the following direction has been given by the Bench: In the result, the appeal is allowed. The order passed by the Assessing Officer, the Commissioner of Income Tax (Appeals) and the order passed by the Income Tax Appellate Tribunal, Bangalore Bench dated March 21, 2003, in I.T.A. No. 595/Bang/2000 are hereby set aside and the matter is remanded to the Assessing Officer for fresh consideration in accordance with law. The order passed by the Assessing Officer, the Commissioner of Income Tax (Appeals) and the order passed by the Income Tax Appellate Tribunal, Bangalore Bench dated March 21, 2003, in I.T.A. No. 595/Bang/2000 are hereby set aside and the matter is remanded to the Assessing Officer for fresh consideration in accordance with law. In the circumstances, we are not prepared to answer the question of law framed by the appellant in view of the order of remand. 7. Learned Counsel for the parties submitted that this appeal can also be disposed of on the similar directions as the questions posed in this appeal are identical to one which have already been dealt with, and the matter remitted to the file of the Assessing Officer. Thus, with the same directions, this appeal stands disposed of.