Jaipur Development Authority, Jaipur vs Assessee

Jh vkj-ih-rksykuh] U;kf;d lnL; ,oa Jh Vh-vkj-ehuk] ys[kk lnL; ds le{k BEFORE: SHRI R.P. TOLANI, JM & SHRI T.R. MEENA, AM

vk;dj vihy la-@ITA No. 134 to 136/JP/2015 fu/kZkj.k o"kZ@Assessment Years : 2012-13 to 2014-15

Jaipur Development cuke The ACIT (TDS) Authority, JLN Marg, Vs. Jaipur Jaipur LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: JPRJO 7772 C vihykFkhZ@Appellant izR;FkhZ@Respondent

fu/kZkfjrh dh vksj ls@ Assessee by : Shri Shyam Lal Agarwal and Shri Tarun Agarwal, CA jktLo dh vksj ls@ Revenue by : Smt. Neena Jeph, JCIT

lquokbZ dh rkjh[k@ Date of Hearing : 07/05/2015 ?kks"k.kk dh rkjh[k@ Date of Pronouncement : 29 /05/2015

vkns'k@ ORDER

PER R.P. TOLANI, JM

These is a set of three appeals filed by the assessee against the

consolidated order of the ld. CIT(A)-3, Jaipur dated 31-11-2014 for the

assessment years 2012-13 to 2014-15 challenging the action of the AO

in holding the assessee liable for TDS u/s 194LA and treating the

assessee in default to raise respective demands u/s 201(1) & 2011A) for

these assessment years.

2 ITA No. 134/JP/2015 Jaipur Development Authority vs. ACIT - TDS , Jaipur

2.1 Brief facts of the case are that the assessee is an Urban

Improvement Trust incorporated by the State Govt. for development of

various urban development activities including housing, community

facilities and civic amenities in Jaipur Region. It came into existence by

Jaipur Development Authority Act in the year 1982 (for short JDA). The

assessee had been held to be eligible for registration u/s 12A of the Act as

a charitable organization by ITAT orders. During the course of

verification of TDS matters, it was found that the JDA i.e. through its

Land Acquisition Officer (for short 'LAO') of JDA is making payments

in lieu of the agriculture land acquired by JDA for carrying out its

development plans. It was found that in some of the cases, TDS has not

been deducted by the LAO u/s 194LA of the I.T. Act in respect of

agriculture land without making due verification. These payments in view

of AO were liable for TDS. The LAO didn't deduct TDS merely on the

basis of affidavit furnished about claim of agricultural land. Though the

paper work and affidavits were certified by Tehsildar, JDA were not

conclusive as he was not a revenue officer under land revenue code. The

other documents in possession of assessee were office orders for land

acquired under various schemes, note sheet for lands acquired, financial

and administrative approval orders for making payments to various 3 ITA No. 134/JP/2015 Jaipur Development Authority vs. ACIT - TDS , Jaipur

parties etc. which were not sufficient to hold that JDA was not liable for

TDS u/s 194LA. During the course of verification proceedings, vide this

office letters dated 7-08-2013 and 14-08-2013, the assessee was asked to

submit details of payment of compensation scheme-wise from A.Y. 2011-

12 onwards along with TDS deducted and supporting documents and to

file detailed explanation as why JDA was not deducting TDS u/s 194LA

and why the assessee should not be treated as assessee in default.

2.2 In response, the assessee submitted on 19-08-2013 as under:-

''............

3. As discussed with your goodself, we again submit that no TDS is applicable in case of agriculture land acquisition as defined in section 194LA itself. Your goodself asked that the agriculture lands within the limits of urban area would be covered since these lands are not agriculture lands u/s 2(14) (iii)(a) of the I.T. Act .

4. That we submit the reply before your goodself that for the purpose of Section 194LA the lands covered u/s 2(14) (iii)(a) and (b) are also exempt and the same has been mentioned in the explanation to Section 194LA as cited below:-

Explanation- For the purpose of this section:-

(i) ''Agriculture land' means agricultural land I India including land situate in any area referred to in items

(a) and (b) of sub-clause (iii) of clause (14) of Section 2;

In view of the above, it is very clear that the agriculture land anywhere even in the urban area is covered 4 ITA No. 134/JP/2015 Jaipur Development Authority vs. ACIT - TDS , Jaipur

5. In this respect, we further submit that the issue was discussed at length with the Department in the year 2009 at all the appropriate levels and it was clearly concluded that the same is not covered in the ambit of TDS. It was also well discussed that even after there is a clear provision in the Act. If the TDS is deducted, it will be un- necessary hardship to the poor agriculturists to file the return and take the refund/ seek exemption. In this reference after due discussion, the specific letter was written to TDS authorities vide letter dated 22-04-2009 explaining the same, a copy of which is enclosed herewith.

6. In this letter, the system of verification was also asked so as to keep the details that the land was agricultural land and used for agriculture purposes. All detailed discussions and deliberations the deptt replied that sufficient verification as evidences be collected and recorded and the same be shown as and when required to ensure that the land was agriculture land. The cop of the order of the Department letter No.ito/TDS-2/JPR/09-10/1706 dated 01-04-2010 is enclosed herewith.

7. Since the land acquisition is done by the land acquisition officers which have the patwari tehsildar and the all land revenue authorities / cell and even after the LAO verification, it is verified by the Secretary JDA, an order of verification as agriculture land was issued in all cases of agriculture land that the land is agriculture land, is used for the agriculture purposes and also the compensation is also paid according to that only. The copy of the office order issued the format in case of agriculture land is also enclosed herewith vide office order copy no. JDA /AO(P)/2011/D-757 dated 22-12-2011. The copy is enclosed herewith.''

2.3 The AO made further enquiries and was of the view that the

assessee had not given any satisfactory reply as to why the provisions of

Section 194LA were not applicable to it. Rejecting the assessee's claim, 5 ITA No. 134/JP/2015 Jaipur Development Authority vs. ACIT - TDS , Jaipur

the AO held that it was liable for deduction of TDS qua the acquisition of

such agriculture land and paying into it Govt. Treasury, having default in

its obligation, JDA was held to be liable for tax and interest 201(1) and

201(1A) by following observation.

''5.1.2 The assessee had submitted that land acquisition and payments thereof were done with sufficient proof in land about the land being agriculture i.e. certificate of tehsildar (at JDA) and affidavit from the owner about agriculture being practiced on land and so it being agriculture land. To being with, a certificate from deductee that the land being acquired is agricultural land is not any evidence. The certificate from Tehsildar that was produced by the assessee was of a person who is an employee of the assessee. He is only designated as a Tehsildar for a particular zone and it not the same as Tehsildar appointed by the State Govt.. Now for the internal procedure being followed by the assessee of having all necessary evidence before compensation is made. It appears that evidence in possession of the assessee were only the above said two documents, i.e. the certificate of their Tehsildar and affidavit of the deductee. The Jamabandi was submitted by the assessee to the Department after a period of more than three months. Further, a Jamabandi is only a statement of ownership of a particular land. All land, whether barren, undulating or cultivable is classified as agricultural in a Jamabandi. The Jamabandi report does not give any details as to the actual use of land. A Girdawari report on the other hand gives details of land acquisition. During the course of verification, the assessee was not found in possessin of any Girdawari Report. The assessee has till date not furnished any Girdawari Report for the land claimed to be agricultural land to the Department. In view of above and discussion in the preceding para as to what constitutes agricultural land , the submission of assessee that it had sufficient evidence in its possession that the land was agricultural land, before any compensation was made is not acceptable.

6 ITA No. 134/JP/2015 Jaipur Development Authority vs. ACIT - TDS , Jaipur

5.3.3 Now the contention of the assessee that detailed discussion was done with the Income Tax Department at various levels and based on that various documents were collected that no TDS was deducted on agricultural lands. The Department had asked the assessee to collect all necessary evidences to be satisfied that it is really agriculture land and produce before the Department whenever called for. However, as is evident from discussion in preceding paras, no such evidences were collected to ensure that land was agriculture and being used for agricultural purposes. Further, evidences gathered by the Department from Tehsildar, and on the basis of physical verification of such land as mentioned in Tabel 1, it is seen that the land are not agricultural land nor have they been used for agriculture purposes.

6.1 In view of discussion above, it is evident that in majority of cases (as per Table1 attached) the land claimed to be agricultural land was in reality barren land on which no cultivation was undertaken in last so many years. In large number of cases, the land was unfit for any cultivation. Hence, the assessee's contention that no TDS was deducted because the land was agricultural land is not acceptable. Further, the assessee's contention that it had sufficient evidences in its possession to derive satisfaction that the land was agricultural land is also not acceptable, as discussed in preceding para. Hence, the assessee was required to deduct TDS u/s 194A of the I.T. Act in all such cases. However, the assessee has failed to deduct TDS and accordingly the assessee is deemed to be an assessee in default u/s 201(1) of the I.T. Act in respect of the amounts not so deducted. Interest u/s 201(1A) is also charged as per law. A detailed chart of party-wise non-deduction is enclosed as Table 2 to this order. In this case, since most of the payments are made without obtaining any Permanent Account Number from the parties, TDS is calculated at the rate of 20% as mentioned in Section 206AA of the I.T. Act, 1961.

7 ITA No. 134/JP/2015 Jaipur Development Authority vs. ACIT - TDS , Jaipur

6.2 The TDS liability of each financial year is calculated as below:-

F.Y. 201(1) 201(1A) Total 2011-12 14073886 3578382 17652268 2012-13 22548366 3859487 26407853 2013-14 (upto 6- 4829182 452975 5282157 08-2014) Total 49342278

2.4 Aggrieved, the assessee preferred first appeal where detailed

submissions were made along with reference to various case laws.

However they didn't find the favor with ld. CIT(A) who confirmed the

order of the AO by following observations.

''6.5 I have carefully considered the findings of the AO as also the submission of the appellant. It may be noted that the JDA has acquired various lands for its development plans on which compensation has been paid. The appellant case is that the land so acquired were all agricultural land and that the TDS was not to be deducted as per provisions of Section 194A of IT Act. In support of such submission the appellant has furnished 'Jamabandi' reports of all such lands as also relied on the correspondence made with the ITO, TDS -2, Jaipur on the above subject. As per the appellant before making payment to such persons certificate of Tehsildar posted in the JDA itself was obtained as also affidavits of all the payees were obtained and both these documents confirmed that the said lands were agricultural lands. On the other hands, the AO's case is that the 'Jamabandi' reports only proved the right of ownership and that the certificate issued by Tehsildar posted in the JDA itself and who is otherwise employee o the JDA cannot be a valid evidence inasmuch as the Tehsildar was not the jurisdictional Tehsildar as also before issuing such certificate, the Tehsildar has not actually verified the actual 8 ITA No. 134/JP/2015 Jaipur Development Authority vs. ACIT - TDS , Jaipur

use of such land or the fact that whether such land was being used for agricultural purposes or not. The AO also conducted further enquiries from the Jurisdictional Tehsildar on the fact of actual use of land it was not being used for agricultural purposes for the last 6-7 years. The detail list indicating actual status of each land is prepared by the AO on the basis of enquiries made from the Jurisdictional Tehsildar and such list formed part of the assessment order. In view of these facts, the AO was of the opinion that such barren lands and the lands which are not being used for agricultural purposes for the last 6-7 yers cannot be said to be agricultural lands and therefore, TDS was to be deducted u/s 194LA of I.T. Act. The AO also relied on the decision of Hon'ble Kolkata High Court in the case of Tea Estates India (P) Ltd. vs. CIT 59 ITR 482 (WT) in which the Hon'ble Court has held that the agricultural land should be the land connected with the cultivation involving expenditure on human labour skills for the purpose of cultivation or keeping it in a cultivable state. On careful consideration of all above mentioned facts, it may be noted that there is no dispute on the fact that the land which has been acquired and on which payments have made to the land owners were barren land or the lands which are not usable for agricultural purposes or not being used for agricultural purposes.

It is also undisputed fact that though before making payment , the appellant has obtained affidavit of the payees as also certificate of the Tehsildar posted in the JDA certifying that these lands were agricultural land but actual use of the land was not ascertained from the Jurisdictional Tehsildar's / Revenue authorities. It may also be noted that as per provisions of Section 194A compensation made against any immovable property other than the agricultural land is to be covered for deduction of tax but what constitutes the agricultural land is not defined in the Act. It is also correct that the definition of the agricultural land as provided in Section 2(14)(iii) is for the capital gain provisions. In this background the decision of Hon'ble Kolkata High Court in the case of Tea Estates India (P) Ltd. vs. CIT, 59 ITR 482 (WT) though in respect of Wealth Tax proceedings can be a guiding factor as to what constitute the 9 ITA No. 134/JP/2015 Jaipur Development Authority vs. ACIT - TDS , Jaipur

agricultural land and as per the decision of the Hon'ble Court the land which is actually connected with the cultivation should only be considered as a agricultural land. The fact that such lands were barren or otherwise only be considered as a agricultural land. The fact that such lands were barren or otherwise not of cultivatable nature is even not disputed by the appellant. It is also fact that the appellant has relied on the 'Jamabandi' reports and did not verify the actual use of the land of agricultural purposes. It is also fact that even the AO-TDS has advised the appellant to verify the fact of actual use of the land for agricultural purposes. I found merit in the contention of the AO that 'Jamabandi' Reports only proved the ownership rights over the land and these reports did not indicate the actual use of the land. As regards the main contention of the assessee that before making of such payment proper documentary evidences were obtained even as per guidance given by the departmental authority i.e. ITO, TDS -2, Jaipur, it may be noted that such contention appears to be not correct inasmuch as even the ITO, TDS -2, Jaipur has advised the appellant that both certificate from Tehsildar and affidavit from the payee regarding present use should be obtained but the appellant has not ensured present use of the land. Moreover, the Tehsildar posted in the JDA may not be a competent authority to report regarding actual use of the land and it is fact that before making of such payment actual use of the land was not ascertained from the Jurisdictional Tehsildar. The appellant has also relied on the decision of Hon'ble High Court of Karnataka in the case of Mysore Urban Development Authority and others vs. ITO, 175 Taxman 307, however, the facts of this case are altogether different inasmuch as in this case the land situated in the Municipal Limits as per provisions of Section 2(14) was treated to be not an agricultural land and accordingly brought under the purview of Section 194LA of I.T. Act. The Hon'ble Court held that for the purpose of Section 194LA even the land situated in Municipal limits is to be treated as agricultural land and these facts are even clear from the provisions of Section 194LA. In this manner in this case law the issue as to whether what should constitute the 10 ITA No. 134/JP/2015 Jaipur Development Authority vs. ACIT - TDS , Jaipur

agricultural land was not the issue. As regards the other case law relied upon the appellant in the case of ITO (TDS -

2) vs. Special Land Range Acquisition Officer, IT Appeal No. 4174 of 2009 (ITAT, Mum.). It may be mentioned that this case law are also different to the facts of the appellant case inasmuch as in this case the land was not cultivated by the owners because it was intended to be for acquisition by the Railways. That means, the land in question was of cultivatable nature on which agricultural operations could have been done but these operations were not done because of the land was to be acquired by the Railways. In the appellant case, it is not the case that the land was not being cultivated as it was to be acquired by the JDA and the fact was that the land was not of cultivatable nature. Moreover the finding of the Hon'ble Supreme Court as to what constitute the agricultural land cannot be altered or supersede by the findings of the Hon'ble ITAT. There is nothing on record which may indicate that the findings of Hon'ble Supreme Court has subsequently been modified or overruled by any other larger Bench of the Court. It may also be mentioned that provisions of TDS are introduced in the statute to ensure recover of tax on the taxable receipts/ income i.e. where the income is otherwise taxable.

During the appellate proceedings, it was enquired from the ld A.R. of the appellant whether the land on which such compensation was paid situated in 8 K.M. of Municipal Limits for levy of capital gain and it was admitted by the ld. AR that such land were situated within 8 KM Municipal Limits. These facts indicate that payments against acquisition of such land was otherwise also of taxable nature.

Keeping in view the above mentioned facts and circumstances of this case, I am of the considered view that the AO was right in holding that on compensation paid on acquiring of these lands; TDS was to be deducted as per provisions of Section 194LA of I.T. Act. Accordingly, the finding of the AO as also demand raised u/s 201(1)/ 201(1A) 11 ITA No. 134/JP/2015 Jaipur Development Authority vs. ACIT - TDS , Jaipur

of I.T. Act in respect of AYs 2012-13, 2013-14, 2014-15 is confirmed.

The grounds of appeal are dismissed.''

2.5 Aggrieved, the assessee is before us.

2.6 The ld. Counsel for the assessee drew our attention to Section

194LA of the Act which reads as under:-

''Section 194LA: "Any person responsible for paying to a resident any sum, being in the nature of compensation or the enhanced compensation or the consideration or the enhanced consideration on account of compulsory acquisition, under any law for the time being in force, of any immovable property (other than agricultural land), shall, at the time of payment of such sum in cash or by issue of a cheque or draft or by any other mode, whichever is earlier, deduct an amount equal to ten per cent of such sum as income-tax thereon:

Provided that no deduction shall be made under this section where the amount of such payment or, as the case may be, the aggregate amount of such payments to a resident during the financial year does not exceed two hundred thousand rupees.

Explanation.--For the purposes of this section,--

(i) "agricultural land" means agricultural land in India including land situate in any area referred to in items (a) and (b) of sub-clause (iii) of clause (14) of section 2;

(ii) "immovable property" means any land (other than agricultural land) or any building or part of a building.]"

12 ITA No. 134/JP/2015 Jaipur Development Authority vs. ACIT - TDS , Jaipur

It is contended by the counsel Shri Shyam Agrawal, FCA that JDA is a

payer of compensation under a settled acquisition policy by which

lesser compensation is payable for agricultural land and more

compensation on commercial land; consequently JDA will not acquire

commercial land camouflaging it as agricultural land. A plain reading

of Section 194LA provides that Agricultural land means agricultural

land in India including land situate in any area as mentioned above. It

leads to unambiguous understanding that once the payee produces the

prescribed documents about the ownership of the agricultural land for

acquisition which fits into meaning as assigned in Explanation (i), no

TDS is deductible on such compensation. Section 194LA does not cast

any obligation on the assessee to physically verify whether the

agriculture operations ARE carried on the land to be acquired. The

above legal provision contemplate that there is no obligation for

deducting TDS if the acquired land is agricultural land situate in the

specified area. Ld. ACIT during the course of hearing prescribed the

format and documents to hold the land to be covered under Explanation

(i) of the Section 194LA of the Act, it has been duly complied with by

JDA. Thus requisite record which in the eyes of the AO was sufficient

to hold the agriculture land as covered in under Explanation (i) was 13 ITA No. 134/JP/2015 Jaipur Development Authority vs. ACIT - TDS , Jaipur

squarely complied with by the assessee. It is trite law that the language

of any taxing provision being plain and unambiguous, there is no use of

further interpretation or reading some more conditions in the

provisions. The letter issued by the AO is placed at page 5 of the Paper

Book Volume 1 indicate that ''For safety, both certificate from

Tehsildar and affidavit from payee regarding present use may be

obtained.'' After verifying JDA's compliance, ld. ACIT took U turn

and again insisted for physical verification of the agricultural operation

being carried out or not. The AO has failed to appreciate that Tehsildar

level officer appointed by JDA is also from the Revenue dept of State

Govt. and are Revenue officer appointed under JDA Act. Their

authority cannot be diluted by such sweeping observation as they are

work in JDA framework with independent functioning. It is further

contended that :-

(i) Section 194LA does not obligate the assessee to go beyond the record of agriculture and to physically verify the cultivation of crop and conducting of agricultural operation and nature of land.

This is nearly impossible function which will hamper the acquisition process defeating the public interest.

(ii) The AO has though accepted that some of the land girdawari has been verified and land is ''Barani land'' which is not 14 ITA No. 134/JP/2015 Jaipur Development Authority vs. ACIT - TDS , Jaipur

agriculture land. Record is referred to the effect that ''Barani land'' is also a category of agricultural land which is cultivated in rains only whereas Chahi land is cultivated throughout the year . Therefore, any adverse reference is drawn from the word ''Barani land'' is misplaced as it is one of the agricultural land only. Therefore TDS is not deductible on acquisition of Barani land.

(iii) The AO has accepted the fact that the land acquired by the assessee on which no TDS has been deducted is clearly mentioned as agriculture land in Revenue record. Once this finding is arrived then the obligation about deducting TDS doesn't exist. Besides as per the scheme of the I T Act revenue has a remedy to enquire the tax liability in the hands of the payee about their liability for capital gains.

(iv) Reliance is placed in the case of ITO .TDA-2 vs. Special Land Acquisition Officer (ITAT Mumbai Bench 'E' (2011) 12 Taxmann.com 49 wherein it has been held that "Moreover, after considering the relevant provisions of the Act and particularly section 194LA, it was found that the land in question was basically an agricultural land and there was no material either pointed out by the Assessing Officer or brought before the Tribunal to show that the land acquired was used for non-agricultural purposes by the owners of the land. The revenue had come out with the argument that since the land was not under cultivation and it was not fit for agricultural, therefore, it could not be treated as agricultural land. It was not a decisive factor when the land itself was agricultural land though may not be used for agricultural purposes but unless and until the same was used for non- agricultural purposes it could not be said that the land could not be 15 ITA No. 134/JP/2015 Jaipur Development Authority vs. ACIT - TDS , Jaipur

treated as agricultural land for the purposes of section 194LA. Even otherwise these questions were relevant only for deciding the taxability of income in the hands of the owners of the land.''

(v) Further reliance is placed in the case of Special Land Acquisition Officer vs. ITO, TDS -4 (ITAT Ahemdabad Bench 'A' (2010) 42 to SOT 9 wherein it was held by the ITAT that "From the discussion made by both the parties and careful study of the undisputed facts following conclusions can be drawn :-

(1)For the purposes of determining whether land is agricultural land or not it is the prima facie satisfaction of the LAO. The law does not provide any role to the Assessing Officer in such determination at the time of awarding compensation.

(2)The Land Acquisition Officer has to only prima facie decide whether the land being acquired by him is an agricultural land or not.

(3)For the purposes of determining whether the land in question is agricultural land or not the entries in the revenue records is prima facie evidence of land being agricultural land.

(4)It is immaterial whether land has not been used for agricultural purposes for a long time or the land is fallow.

(5)No doubt the final authority is the ITO for determining whether the land sold by the farmers/land owners is agricultural land or not and whether capital gain is liable thereon or not but for the purposes of TDS the prima facie satisfaction of the Land Acquisition Officer is sufficient to determine whether land is agricultural land or not.

(6)There is no provision in section 194LA for any reference to the revenue authorities by the Land Acquisition Officer for 16 ITA No. 134/JP/2015 Jaipur Development Authority vs. ACIT - TDS , Jaipur

obtaining their opinion as to the nature of the land being acquired by him.

(7)The presumption raised by the Land Acquisition Officer is rebuttable and evidence can be adduced against it by the Assessing Officer but that can be done only during the assessment proceedings.

(8)In the absence of any provision in section 194LA the Assessing Officer cannot enter to influence the view of the LAO on the character of a land acquired by him if he has prima facie evidence in support of the view which he has framed. There is also no provision to give any opportunity to the Assessing Officer for rebutting the presumption in the Court of Land Acquisition Officer against the presumption raised by him.

(9)The definition of the agricultural land contained in section 2(14)(iii) (a) & (b ) cannot be imported for determining the land as agricultural land because such definition is separately given in section 194LA. Further, definitions given in section 2(14)(iii)( a) & (b ) are for the purpose of determining whether capital gains would be chargeable or not on the land sold and for that purpose, whether the land in question would be agricultural land or not.

That definition can be applied when the question of levy of capital gain arises before the Assessing Officer.

A plain and simple reading of Section 194LA as proposed by the

assessee has been held by Hon'ble Karnataka High Court in the case of

Mysore Urban Development Authority & Ors vs. ITO , High Court of

Karnataka, reported in 175 Taxman 307 (2008), 218 CTR (Kar.) 678

(20) wherein it was held that 17 ITA No. 134/JP/2015 Jaipur Development Authority vs. ACIT - TDS , Jaipur

''The very authority also has indicated that the compensation being paid is in respect of agricultural land acquired by the development authority, there is no question of further examination of this aspect on the premise that it is either non-agricultural or land converted etc. 19. Insofar as the understanding of the provisions of s. 194LA is concerned, I find that unlike many other sections under the Act, this section is fairly short and simple. It does not give scope for either ambiguity or interpretation. It has to be merely read and understood and nothing more. The caption to the section which reads as "Payment of compensation on acquisition of certain immovable property" is very indicative as to for what purpose the provision has been made. One should appreciate that the liability here is an artificial liability on the person distributing the compensation in respect of immovable property as in the hands of the recipient the compensation received may be capital gain which is income taxable under the Act and therefore the legislature wanted a safeguard in favour of the Revenue by providing for deduction at source at some percentage of the amount paid by way of compensation so that the deducted amounts act as security for realization of the actual liability of tax to be determined by the authority later at the end of the assessment year etc.

20. It is not the liability of the person distributing the compensation, but the liability of a person receiving the compensation amount. Now, it is very clear that the obligation on the part of the person to deduct is only in respect of compensation on acquisition of certain immovable properties. While agricultural land undoubtedly is an immovable property, the main part of s. 194LA itself excludes agricultural land from the immovable property covered by s. 194LA as the words in the brackets indicate, i.e. (other than agricultural land)."

2.7 The ld. DR supported the orders of the lower authorities.

2.8 The ld. Counsel for the assessee in rejoinder contends that those

lands which were not agriculture in nature as per record were subjected

to TDS on acquisition u/s 194LA. The relevant information is in the

paper book. Non-deduction of TDS on the agricultural land apart from 18 ITA No. 134/JP/2015 Jaipur Development Authority vs. ACIT - TDS , Jaipur

the meaning of section was carried out on the basis of proforma

provided by the AO. Having complied with all these provisions, there

was no justification on the part of ACIT and ld. CIT(A) to hold that the

assessee is liable for TDS u/s 194LA and the assessee is deemed in

default for levy of tax and interest u/s 201(1A), therefore, demands in

question are untenable. It may be held that assessee is not liable for

TDS in respect of acquisition of agricultural land and demand to be

deleted.

2.9 We have heard the rival contentions and perused the materials

available on record. From the record, it emerges that the assessee

demonstrated its case for no liability of TDs before the ACIT -TDS

that not only in terms of plain reading of Section 194LA but also

furnished the desired information in the proforma and enclosures as

advised by the AO to be furnished in the order to hold JDA as not-

liable under explanation (i) above. Having complied with the

requirement, assessee has discharged its onus. Besides in view of the

Ahemdabad and Bombay ITAT judgments, the liability of assessee u/s

194LA cannot be extended to go beyond the plain meaning of the

letters of section and infuse such conditions which are not mentioned in 19 ITA No. 134/JP/2015 Jaipur Development Authority vs. ACIT - TDS , Jaipur

the provisions. In consideration of the entirety of the facts and

circumstances of the case, we are of the view that :-

(i) The assessee complied with requirements asked for by the AO. There is no adverse comment on this issue.

(ii) Section 194A does not provide any physical verification of the assessee to inspect the fields and find out whether the lands are actually cultivated or not. What section imposes is determination of the record which has been done by the assessee.

(iii) Barani land is a type of agricultural land which is clearly evident from Revenue regulations and record placed on the paper book. The objection raised by the AO and ld. CIT(A) about Girdawari is irrelevant and no-consequential.

(iii) Tehsildar appointed by JDA cannot be denied to be a Revenue Officer inasmuch as he works as a Revenue Officer in terms of JDA Act.

(iv) The language of Section 194LA being plain and simple it provides no physical verification of land by LAO about carrying on of agricultural operations. In the framework of sec. 194LA, there is no need of applying rules of interpretation and imposing further condition to go beyond the scope of obligation as prescribed under the Act

In view thereof, we hold that the assessee has been able to demonstrate

from the record that impugned agricultural land acquired by the

assessee are agricultural land on per records and in terms of Section

194LA, Explanation (i). There is no obligation to deduct any TDS 20 ITA No. 134/JP/2015 Jaipur Development Authority vs. ACIT - TDS , Jaipur

thereon. Thus there is no question of raising demand against the

assessee u/s 201(1) and 201(1A) of the Act and hold the assessee to be

in default. Consequently, the orders of the lower authorities are

reversed and the demands raised in question by the Department are

quashed.

3.0 In the result, the appeals of the assessee are allowed.

Order pronounced in the open court on 29/05/2015.

Sd/- Sd/- ¼Vh-vkj-ehuk½ ¼vkj-ih-rksykuh½ (T.R. Meena) (R.P.Tolani) ys[kk lnL;@ Accountant Member U;kf;d lnL;@Judicial Member

Tk;iqj@Jaipur fnukad@Dated:- 29 /05/ 2015 *Mishra

vkns'k dh izfrfyfi vxzfs 'kr@Copy of the order forwarded to:

1. vihykFkhZ@The Appellant- Jaipur Development Authority, Jaipur

2. izR;FkhZ@ The Respondent- The ACIT -TDS, Jaipur

3. vk;dj vk;qDr¼vihy ) @ CIT(A)

4. vk;dj vk;qDr@ CIT

5. foHkkxh; izfrfuf/k] vk;dj vihyh; vf/kdj.k] t;iqj@DR, ITAT, Jaipur

6. xkMZ QkbZy@ Guard File (ITA No.134/JP/2015)

vkns'kkuqlkj@ By order,

lgk;d iathdkj@ Assistant. Registrar