Vanita H.Alimcandani, Mumbai vs Assessee

ITA No. : 3172/Mum/2013 (Assessment year: 2005-06) Mrs. Vinita H. Alimcandani, Vs ITO -19(2)(2), C/o. M R Chambers, Piramal Chamber, M C Road, Mumbai -400 012 Andheri (East), Mumbai -400 093 ःथयी लेखा सं.:PAN: AGYPA 7278 C अपीलाथ (Appellant) ू"यथ (Respondent) Appellant by : Shri K K Lakshminarayanan Respondent by : Shri Sacchidanand Dubey

सुनवाई क% तार'ख /Date of Hearing : 12-01-2015 घोषणा क% तार'ख /Date of Pronouncement : 13-02-2015

आदेश ORDER ी िववेक वमा , या स: स: PER VIVEK VARMA, JM:

Instant appeal is field by the assessee against the order of CIT(A)-30, Mumbai, dated 19.03.2013, wherein the following revised grounds have been raised:

"1. The order passed by the learned CIT (A) is bad in law.

2. The Assessing Officer erred in holding that the sum of Rs. 2,58,35,652/- received by the appellant on retirement from the firm, which was not dissolved, is income from Business. The learned CIT (A) erred in holding that the said sum of Rs. 2,58,35,652/- is taxable u/s.45(4).

3. The learned CIT (A) failed to note of following decisions.

i) Smt. Paru Dave 110 ITD 410 MUM --that revaluation of 2 ITA 3172/M/2013 Mrs. Vinita H. Alimcandani

asset of partnership firm and crediting the same to partner's a/c. does not entail transfer.

ii) Prashant Shah 324 ITR 154 BOM - that any amount paid to partners as final settlement of dues on retirement does not involve tax liabilities.

iii) CIT V. Kunnamkulam Mill Board 257 ITR 544 Ker.

Retirement of Partner taking enhanced amount on a/c. of revaluation does not attract 45(4).

iv) ITO V. A R Asher ITA No.526/M/9 Retirement of Partner taking enhanced amount on a/c. of revaluation does not attract 45(4).

4. Learned CIT (A) erred in not granting relief u/s.54F on the investment made in two adjacent flats within specified time.

5. Learned CIT (A) erred in stating that appellant was owning already a flat before claiming deduction u/s.54F whereas appellant was not owning any such flat.

6. It is prayed that the amount received on retirement from the firm may be held as non taxable.

7. Without prejudice to that, appellant may be granted benefit u/s. 54F.

8. The appellant craves liberty to add, amend, alter, and/or withdraw any of the above grounds of appeal".

2. The assessee has also taken additional ground of appeal, which is as under:

"Without prejudice to the above grounds of appeal, it is prayed that appellant may please be granted the benefit of sec. 54-F to the extent of investment made in the purchase of residence".

3. The facts are that the assessee was partner in M/s B Alim Builders. In the current year, the assessee retired from the firm and received a substantial sum of money. Originally, the assessee did not file her ROI but as a consequence of notice u/s 148, she filed the return, but did not offer any tax on the sum received by her on retirement. In the assessment proceedings, the assessee contended that the provisions of section 45(4) does not apply on her and therefore no tax was paid, relying on the decision of CIT vs Lingmallu Raghukumar R, reported in 247 ITR 801(SC). The AO distinguished the decision and placing reliance on the decision of ALA Firm vs CIT, reported in 189 ITR 285 (SC). The AO held that in the case of the assessee, the valuation was done just prior to retirement but in the case of ALA Firm, the account have to be made upto the date of dissolution.

3 ITA 3172/M/2013 Mrs. Vinita H. Alimcandani

4. In appeal before the CIT(A), the assessee reiterated her submissions, as made before the AO, which were rejected. The assessee also pointed out that the assessee had in fact invested the retirement proceeds in the purchase of 2 adjacent residential flats and claimed deduction u/s 54F, which was also denied by the AO.

5. The CIT(A) sustained the observations of the AO.

6. Against this order, the assessee is in appeal before the ITAT.

7. Before us, the AR reiterated the submissions and in the GOA filed before us pointed out that the revenue authorities erred in not considering the decisions, which were placed before them. The AR also submitted that the revenue authorities did not allow the benefit of section 54F.

8. The AR, therefore, pleaded that since the revenue authorities did not take into consideration various arguments, the case be restored for fresh adjudication.

9. The DR relied and supported the orders of the revenue authorities.

10. We have heard the arguments and have pursued the orders of the revenue authorities and the case laws cited. It is a fact that the CIT(A) did not take into consideration the various case laws, which according to the AR were relevant to the appeal. In this circumstances, we agree with the AR that the case be restored to the file of the CIT(A) for fresh adjudication on both the issues, i.e. taxability of retirement receipts and deduction u/s 54F. It is needless to mention that the CIT(A) shall provide reasonable and adequate opportunity to the assessee to present her case.

4 ITA 3172/M/2013 Mrs. Vinita H. Alimcandani

11. All the GOA inclusive of Additional ground vide letter dated 17th April, 2014, are therefore restored to the file of the CIT(A).

12. In the result, the appeal is treated as allowed for statistical purposes.

Order pronounced in the open Court on 13th February, 2015.

(आर.

आर. सी.

सी. शमा ) (िववेक वमा ) Sd/- Sd/-

लेखा सद य याईक सद य (R C SHARMA) (VIVEK VARMA) ACCOUNTANT MEMBER JUDICIAL MEMBER

Mumbai, Date: 13th February, 2015

ूित/Copy to:-

1) अपीलाथ /The Appellant.

2) ू"यथ /The Respondent.

3) The CIT(A) -30, Mumbai.

4) The CIT-City-19, Mumbai/CIT -City-19, Mumbai.

5) .वभागीय ूितिनिध "यॅफ़", आयकर अपीलीय अिधकरण, मुबं ई/ The D.R. "F" Bench, Mumbai.

6) गाड2 फाईल Copy to Guard File.

आदे शानुसार/By Order / / True Copy / /

उप/सहायक पंजीकार आयकर अपीलीय अिधकरण, मुबं ई Dy./Asstt. Registrar I.T.A.T., Mumbai

*च हान व.िन.स *Chavan, Sr.PS