M/S AKAAR FOUNDARIES PVT. LTD., V. THE ADDL. COMMISSIONER OF INCOME-TAX,

ITA/100096/2015

AI Insights

The case involves M/s. Akaar Foundaries Pvt. Ltd., which appealed against the order of the Income-Tax Appellate Tribunal concerning the assessment of capital gains for the sale of immovable property for the assessment year 2006-07. The primary contention was regarding the valuation of the property, which was assessed based on the stamp value rather than the transaction value declared by the appellant. The Assessing Officer, after objections from the assessee, referred the matter to the District Valuation Officer, who assessed a higher fair market value. The Tribunal upheld this assessment, leading to the current appeal. The High Court of Karnataka dismissed the appeal, stating that the procedural requirements of Section 50C were met and that the valuation was a factual determination not suitable for appeal as a question of law.

• Counselvise Citation: [2017] 140 COUNSELVISE.COM (IT) 693540 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 12-07-2017
• Assessment Year: misc
• Other Referred Cases: Commissioner of Income Tax Vs. Smt. Shweta Bhuchar (2010) 192 Taxman 67 (P&H)
• Laws Referred To: Income-Tax Act 1961
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: Y V RAVIRAJ
• Assessee Lawyers: H R KAMBIYAVAR; V K GURUNATHAN
• Keywords: Capital Gains; District Valuation Officer; Fair market value; Income Tax; Stamp Value Assessment
• Section: 50C; 260A

Judgement Text

" : 1 : IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH DATED THIS THE 12TH DAY OF JULY, 2017 PRESENT THE HON’BLE MR.JUSTICE A.S.BOPANNA AND THE HON’BLE DR.JUSTICE H.B. PRABHAKARA SASTRY ITA NO.100096/2015 BETWEEN: M/S. AKAAR FOUNDARIES PVT. LTD., M-31, INDUSTRIAL ESTATE, UDYAMBAG, BELGAUM, REPTD. BY ITS MANAGING DIRECTOR, SRI ASIM KAMAT, AGED 41 YEARS, SON OF SRI ASHOK. …APPELLANT (BY SRI.H.R.KAMBIYAVAR, SRI V.K.GURUNATHAN FOR SRI. S. PARTHASARATHI, ADV..) A N D : THE ADDL. COMMISSIONER OF INCOME-TAX, RANGE-1, BELGAUM. …RESPONDENT (BY SRI. Y.V.RAVIRAJ, ADV.) THIS ITA IS FILED UNDER SECTION 260A OF THE INCOME-TAX ACT 1961 PRAYING TO (A) FORMULATE THE : 2 : SUBSTANTIAL QUESTIONS OF LAW AND (B) ALLOW THE APPEAL AND SET ASIDE THE ORDER OF INCOME-TAX APPELLATE TRIBUNAL DATED 04.03.2015 BEARING ITA NO.142/PNJ/2014 FOR THE ASSESSMENT YEAR 2006-07. THIS APPEAL COMING ON FOR ADMISSION THIS DAY, A.S.BOPANNA J., DELIVERED THE FOLLOWING: JUDGMENT The appellant is before this Court assailing the order dated 04.03.2015 passed in ITA No.142/PNJ/2014. The Assessing Authority while taking note of the returns of the appellant for the assessment year 2006-07, in respect of the sale transaction assessed the same by taking into consideration the stamp value assessment in respect of the property in question. The same has been upheld by the appellate authority, as well as the Tribunal. It is in that circumstance, the appellant is before this Court. 2. The learned counsel for the appellant though seeks to contend that the question of law as raised in this appeal arises for consideration, essentially : 3 : what requires to be noticed by us is with regard to the nature of consideration that is made by the competent authorities keeping in view Section 50C of the Income Tax Act, 1961, which is relevant in the present circumstance. 3. In that regard on taking note that the transaction disclosed by the assessee regarding sale of immovable property for the purpose of consideration of the capital gains at Rs.61,00,000/-, keeping in view the fact that the stamp value assessment for it had fixed the value of such property at Rs.92,52,000/, the Assessing Officer has taken into consideration the same. However, in view of the objections raised by the assessee and keeping in view the provisions contained in Section 50C, reference was made to the District Valuation Officer, Bengaluru. The District Valuation Officer through the order dated 17.12.2008 has fixed the fair market value of the property in question at Rs.1,50,11,400/-. It is in that light having kept in view the provision of the Act : 4 : and the procedure that was required to be adopted, since in that circumstance, the value fixed by the stamp valuation authority was necessary to be taken into consideration, the value of Rs.92,62,000/- was taken into consideration and assessment has been completed. The consideration as made therein has been upheld by the Tribunal as well. 4. Therefore, in the circumstance where the provision of law has been kept in view and the procedure has been followed, at this juncture to contend that a question of law arises in this appeal would not be acceptable. The learned counsel for the appellant no doubt would seek to contend that the consideration as made by the Tribunal by taking note of the decision of the High Court of Panjab & Haryana in the case of Commissioner of Income Tax Vs. Smt. Shweta Bhuchar (2010) 192 Taxman 67 (P&H) is not appropriate. However, what is to be taken note is that what has been indicated therein is with regard to the : 5 : procedure to be adopted under Sec. 50C of the Act. As noticed in the instant case, the procedure has been adopted and stamp value assessment is applied. Further though the learned counsel for the appellant contends that the valuation as made by the District Valuation Officer is without basis, the said aspect cannot be considered in an appeal of the present nature by treating it as a question of law for consideration herein as the assessment made therein a factual determination. 5. In that view, we find there is no question of law for consideration herein. The appeal being devoid of merit, stands disposed of. Sd/- JUDGE Sd/- JUDGE *Svh/- "