Ajay Kumar Mittal, J. - (1.) This appeal has been preferred by the appellant -assessee under Sec. 260A of the Income Tax Act, 1961 (in short, "the Act") against the order dated 23.5.2014, Annexure A. 14 passed by the Income Tax Appellate Tribunal, Amritsar Bench, Amritsar (in short, "the Tribunal") in ITA No. 579/(Asr)/2011 for the assessment year 2008 -09, claiming following substantial questions of law: - "i) Whether the income clearly exempted from ambit of Income Tax Act can constitute basis for claim of tax, interest, penalty, only on the ground that factum of non taxability of the sale proceeds, being outside the purview of capital gain as per notification of Central Government was not known to the assessee at the stage of filing return under Sec. 139 of Income Tax Act? ii) Whether the facts and documents of the present case justify the impugned orders? iii) Whether the learned Commissioner of Income Tax (Appeals) has not grossly erred in failing to judiciously consider the material question of non taxability of the sale proceeds as capital gain by also declining to remand back the matter to the Assessing Officer in exercise of the jurisdiction vested in the authorities below under Sec. 250(4) of Income Tax Act and whether resultantly the impugned order being made by material irregularity in exercise of jurisdiction vested in the said authority under Sec. 250(4) of Income Tax Act is sustainable in the eyes of law? iv) Whether the learned Appellate Tribunal has not grossly erred in failing to judiciously consider the material question of non taxability of the sale proceeds as capital gain by again declining to remand back the matter to the Assessing Officer in exercise of the jurisdiction vested in the authorities below under Rule 28 of Appellate Tribunal Rules, 1963 of Income Tax and whether the consequently impugned order being made by material irregularity in exercise of jurisdiction vested in the said authority under Rule 28 of the Appellate Tribunal Rules, 1963 of Income Tax is sustainable in the eyes of law?
(2.) A few facts relevant for the decision of the controversy involved as narrated in the appeal may be noticed. The appellant filed his income tax return for the financial year 2007 -08 relating to assessment year 2008 -09 through his Chartered Accountant declaring gross income of Rs. 2,24,44,720/ - on 26.3.2009 though the due date was 31.7.2008 on account of the reasons beyond his control. Further, due to inadvertent error in the office of the Chartered Accountant of the appellant, the self assessed tax liability as reflected in the return was mentioned to the tune of Rs. 63,71,260/ - and qua the payment of tax again there was erroneous declaration as "paid" while it was not paid in the said income tax return. During the course of summary assessment under Sec. 143(1) of the Act, the Assessing Officer raised a demand of Rs. 67,31,828/ - vide notice dated 20.10.2009, Annexure A. 2. The land of the appellant measuring 24 kanals 7 marlas in Village Meharbanpur, Tehsil Amritsar, District Amritsar which was falling outside the notified 6 kilometers range from the municipal limits was sold for a total consideration of Rs. 2.50 crores vide sale deed dated 25.3.2008, Annexure A. 3. According to the appellant, this land being outside 6 kilometers of municipal limits is not capital asset as per Sec. 2(14) of the Act as applicable to the relevant date and proceeds of the sale in respect of the said land are not subject to capital gain tax. The Assessing Officer treated the error committed by the appellant as wrong verification in the return vide impugned notice dated 20.10.2009, Annexure A. 2. The appellant was called upon to deposit a sum of Rs. 67,31,828/ -. The Deputy Commissioner of Income Tax (DCIT) issued order of penalty under Sec. 221(1) of the Act dated 30.12.2009, Annexure A. 6. The appellant complied with the impugned order. Due to paucity of funds, there was also delay in filing appeal by the appellant. The order of the DCIT against penalty of Rs. 50 lacs was assailed by the appellant before the Commissioner of Income Tax (Appeals) [CIT(A)]. Subsequently, as per the notification regarding exemption of the capital gain in respect of land of the appellant being 6 kilometers of the municipal limits, it was noticed that no liability could be fastened on the appellant. An application was moved by the appellant in the pending appeal. The CIT(A) dismissed the appeal of the appellant and passed impugned order dated 7.10.2011 under Sec. 250(6) of the Act, Annexure A. 7 confirming the penalty of Rs. 50 lacs levied under Sec. 221 (1) of the Act vide penalty order dated 30.12.2009, Annexure A. 6. The said order was challenged by the appellant before the Tribunal under Rule 47(1) of the Income Tax Rules, 1962 (in short, "the Rules"). During the pendency of the appeal before the Tribunal, an application for rectification of the order of the Assessing Officer under Sec. 154 of the Act was also filed on 3.2.2012, Annexure A. 8 by the appellant before the Assessing Officer which was dismissed vide order dated 16.2.2012, Annexure A. 9. The appellant filed appeal against the said order before CIT(A) under Sec. 250(6) of the Act. Vide order dated 15.1.2014, Annexure A. 11, the appeal was dismissed by the CIT(A). Still not satisfied, the appellant filed appeal before the Tribunal. An application for amendment of the grounds of appeal was also filed before the Tribunal. Vide order dated 23.5.2014, Annexure A. 14, the Tribunal dismissed both the appeal and the application filed by the appellant. Hence the instant appeal by the appellant -assessee.
(3.) We have heard learned counsel for the parties.;