INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “B”: NEW DELHI BEFORE SHRI C. N. PRASAD, JUDICIAL MEMBER AND SHRI M. BALAGANESH, ACCOUNTANT MEMBER (Assessment Year:2014-15)

(Assessment Year:2014-15)

(Assessment Year:2014-15)

(Assessment Year:2014-15)

(Assessment Year:2014-15)

(Assessment Year:2014-15)

(Assessment Year:2014-15)

(Assessment Year:2014-15)

(Assessment Year:2014-15)

(Assessment Year:2014-15)

O R D E R PER M. BALAGANESH, A. M.:

1. The appeal in ITA No.1839/Del/2024 for AY 2014-15, arises out of the order of the ld National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as ‘ld. NFAC’, in short] in Appeal No. ITBA/NFAC/S/250/2023- 24/1061118477(1) dated 19.02.2024 against the order of assessment passed u/s 147 r.w.s. 143(3) of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’) dated 30.03.2015 by the Assessing Officer, NFAC, Delhi (hereinafter referred to as ‘ld. AO’).

2. The revenue raised the following grounds of appeal:-

“(i) "Whether, on the facts and circumstances of the case and law, the Ld. CIT(A) was right in law in deleting the addition of Rs. 5,00,16,500/-made by the AD on account of capital gain accruing to the assessee on receipt of full & final payment against sale of urban agriculture land to Triveni Infrastructure Development Co. Ltd. after settlement through Hon'ble High Court?

(ii) Whether, on the facts and circumstances of the case and law, the Ld. CIT(A) has erred in giving relief to the assessee since the assessee has failed to establish that the land is an agricultural land?

(iii) Whether on facts and circumstances of the case, CIT(A) erred in allowing the benefit of exemption u/s 10(37) by treating the amount of Rs 5,00,16,500/- as compensation from Haryana Government even when same was received by the assessee as part of the unpaid sale of the sale agreement dt. 27.04.2006?"

3. We have heard the rival submissions and perused the material available on record. The assessee has filed his return of income for AY 2014-15 on 17.02.2015 declaring total income of Rs. 90,62,720/- comprising salary income of Rs. 6,53,308/- and income from other sources amounting to Rs. 85,19,407/-. The assessee claimed exempt income of Rs. 5,00,16,500/- u/s 10(37) of the Act in the return. The case of the assessee was sought to be reopened u/s 147 of the Act vide issuance of notice u/s 148 of the Act dated 30.03.2021. In response to the said notice, the assessee filed return dated

24.04.2021 declaring the same income of Rs. 90,62,720/-.

4. The assessee is the son and legal heir to Late Smt. Bati Devi. Late Bati Devi sold her land situated at Village Bhatola in Faridabad, Haryana to a company M/s Triveni Infrastructure Development Company Ltd (TIDCL) for industrial purposes for a total consideration of Rs. 6,30,20,625/- on 27.04.2006. Part payment amounting to Rs. 1,30,04,125/- was received by Late Smt Bati Devi and the balance amount of Rs. 5,00,16,500/- remained unpaid by the buyer. However, sale deed and mutation of the land was completed in favour of TIDCL i.e. buyer. Since, the sale consideration was not paid to Late Smt. Bati Devi in full, a legal constraint in the form of civil suit to cancel the sale deed dated 27.04.2006 was activated. The land which was in physical possession of the buyer without payment of full sale consideration, was acquired by Haryana Govt. vide notification No. LAC(F)-2009NTLA/918 dated 06.02.2009 after invoking Section 6 of State Land Acquisition Act. Pursuant to the Civil Suit filed against TIDCL, sale deed was cancelled by the Court vide decree dated 28.05.2008. The evidence to this effect is enclosed in pages 45 to 46 of the Paper Book.

5. Both the parties entered into a compromise wherein one more opportunity was given to TIDCL to get the cheques of Rs. 5,00,16,500/- cleared with an understanding that if the cheques do not get cleared, the sale deed dated 27.04.2006 shall be deemed to be cancelled. Later on the land was acquired by Haryana Govt as stated above vide Notification date