Ravi Venkateswarlu, Visakhapatnam V. The Income Tax Officer, Ward-1(4), Visakhapatnam

CO 12/VIZ/2020

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 6192 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 1 month(s) 28 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 25-09-2020
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2011-2012
• Appeal Filed On: 28-07-2020
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: D K SONAWAL
• Keywords: Reopening of assessment; Sale consideration of property below Jantri Value; Capital asset; Cost of acquisition; Non compliance; Capital Gains
• Section: 143(3); 50C; 2(14); 113; 48; 13; 22; 148; 6; 12; 10; 2; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM BENCH, VISAKHAPATNAM (T HROUGH WEB - BASED VIDEO CONFERENCING PLATFORM) BEFORE SHRI V. DURGA RAO , HONBLE JUDICIAL MEMBER & SHRI D.S. SUNDER SINGH , HONBLE ACCOUNTANT MEMBER I . T . A . NO S . 17 & 18 /VIZ/2020 (ASST. YEAR S : 20 1 1 - 1 2 ) ITO, WARD - 1(4), VISAKHAPATNAM. VS. SRI RAVI VENKATESWARLU, D.NO. 48 - 3 - 6, KEETHI ENCLAVE, SREE NAGAR, VISAKHAPATNAM. PAN NO. AEFPR 1810 L (APP ELLANT ) (RESPONDENT) C.O.NOS. 12 & 13/VIZ/2020 (ARISING OUT OF I.T.A. NOS. 17 & 18/VIZ/2020) (ASST. YEAR S : 2011 - 12 ) SRI RAVI VENKATESWARLU, D.NO. 48 - 3 - 6, KEETHI ENCLAVE, SREE NAGAR, VISAKHAPATNAM. VS. ITO, WARD - 1(4), VISAKHAPATNAM. PAN NO. AEFPR 1810 L (APPELLANT ) (RESPONDENT) ASSESSEE BY : SHRI G.V.N. HARI , ADVOCATE . DEPARTMENT BY : SHRI D.K. SONAWAL , CIT DR DATE OF HEARING : 22 / 0 9 /2020 . DATE OF PRONOUNCEMENT : 25 / 0 9 /20 20 . O R D E R PER V. DURGA RAO , JUDICIAL MEMBER THESE APPEAL S BY THE REVENUE AND THE CROSS OBJECTIONS BY THE ASSESSEE ARE DIRECTED AGAINST THE SEPARATE ORDER S OF 2 ITA NO S . 17 & 18/VIZ/2020 C.O.NOS. 12 & 13/VIZ/2020 ( RAVI VENKATESWARLU ) COMMISSIONER OF INCOME TAX (APPEALS) - 1 , VISAKHAPATNAM , EACH DATED 25 / 1 0/201 9 FOR THE ASSESSMENT YEAR 20 1 1 - 1 2 . SINCE FACTS AND ISSUES ARE COMMON, CLUBBED AND HEARD TOGETHER AND DISPOSED OF BY WAY OF THIS CONSOLIDATED ORDER. ITA NO. 17/VIZ/2020 2. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: - 1. THE ORDER OF THE LD.CIT(A) - 1, VISAKHAPATNAM IS ERRONEOUS BOTH ON FACTS AND IN LAW. 2. THE. CIT(A) HAS ERRED IN QUASHING THE ORDER FOR NON COMMUNICATION OF REASONS FOR REOPENING THE ASSESSMENT AS THE SAME IS NOT REQUIRED IN THE LIGHT OF THE FACT THAT THE ASSESSEE WAS WELL AWARE OF THE REASONS FOR WHICH THE ASSESSMENT WAS REOPENED. HON'BLE ITAT, DELHI, BENCH 'A' IN THE CASE OF INCOME TAX OFFICER VS SMT. GURIVNDER KUAR, REPORTED IN (2006) 102 ITD 189, HAS HELD THAT REOPENING OF ASSESSMENT FOR N ON COMMUNICATION OF REASONS WOULD NOT BE FATAL WHEN THE ASSESSEE WAS AWARE OF THE REASONS FOR WHICH THE REOPENING WAS MADE. 3. THE CIT(A) HAS ERRED IN QUASHING THE ORDER FOR NON COMMUNICATION OF REASONS FOR REOPENING THE ASSESSMENT AS THE SAME IS PROCEDURA L IRREGULARITY WHICH CAN BE CURED BY REMITTING THE MATTER TO THE ASSESSING OFFICER. THE HON'BLE HIGH COURT OF MADRAS, DIVISION BENCH, IN THE CASE OF M/S HOME FINDERS HOUSING LTD. VS INCOME TAX OFFICER, IN W.A NO. 463 OF 2017 HAS HELD THAT NON COMPLIANCE OF PROCEDURE INDICATED IN THE CASE OF GKN DRIVESHAFTS (INDIA) LTD., WOULD NOT MAKE THE ORDER VOID OR NON EST. AS, SUCH A VIOLATION IN THE MATTER OF PROCEDURE IS ONLY AN IRREGULARITY WHICH COULD BE CURED BY REMITTING THE MATTER TO THE AUTHORITY. THIS ORDER OF HON'BLE HIGH COURT WAS CONFIRMED BY THE HON'BLE APEX COURT I.E SUPREME COURT OF INDIA BY DISMISSING THE SPECIAL LEAVE PETITION FILED BY THE ASSESSEE AGAINST THE ORDER OF THE HIGH COURT IN SLP NO. 12721/2018 DATED 18.05.2018. 4. SINCE, THE ASSESSEE HIMSELF DID NOT REQUEST FOR REFERENCE TO DVO DURING ASSESSMENT PROCEEDINGS, THE LD. CIT(A) OUGHT NOT TO HAVE DELETED THE ADDITION SAYING THAT DVO ALSO DID NOT ATTACH ANY VALUE TO THE PROPERTY. 5. THE LD. CIT(A) OUGHT TO HAVE UPHELD THE ACTION OF AO IN 3 ITA NO S . 17 & 18/VIZ/2020 C.O.NOS. 12 & 13/VIZ/2020 ( RAVI VENKATESWARLU ) ASSESSING THE LTCG AS PER 50C OF THE ACT IN THE LIGHT OF THE FACT THAT THE ISSUE WHETHER THE LAND WAS A GOVT. LAND OR A PRIVATE LAND HAS NO BEARING ON THE PROVISIONS OF SEC. 50AS THE MARKET VALUE FOR COLLECTION OF STAMP DUTY WAS ESTIMATED AND THE REGISTRATION WAS DO NE. 6. THE LD. CIT(A) OUGHT TO HAVE NOTICED THAT THE NATURE OF PROPERTY IS NOT THE CRITERIA FOR LEVYING INCOME TAX. EVEN IF THE PROPERTY SOLD IS GOVERNMENT PROPERTY, INCOME TAX IS TO BE LEVIED ON CAPITAL GAIN ARISING FROM SUCH TRANSFER IRRESPECTIVE OF THE OWNERSHIP OF THE ASSET. 7. THE LD. CIT(A) OUGHT TO HAVE APPRECIATED THAT SINCE THE PROPERTY UNDER CONSIDERATION IS GOVERNMENT PROPERTY, ANY LITIGATION LIKELY TO ARISE IN FUTURE, IS TO BE SETTLED BY THE VENDOR AND VENDEE IN THE COURT OF LAW. 8 . THE LD. CIT (A) FAILED TO APPRECIATE THAT AS PER THE DEFINITION OF CAPITAL ASSET U/S. 2(14) OF THE INCOME TAX ACT, OWNERSHIP OF THE CAPITAL ASSET IS IMMATERIAL AND IT IS SUFFICIENT IF THE ASSESSEE HAS HELD IT DURING THE YEAR OF TRANSFER. 9. THE LD. CIT(A) FAILED TO AP PRECIATE THAT AS PER THE DEFINITION OF TRANSFER U/S. 2(47), TRANSFER INCLUDES SALE OR EXCHANGE OR RELINQUISHMENT OF ASSET OR EXTINGUISHMENT OF RIGHTS IN THE ASSET OR ANY TRANSACTION ALLOWING OF THE POSSESSION OF THE IMMOVABLE PROPERTY AND THUS OWNERSHIP OF THE LAND BECOMES IMMATERIAL. 10. THE LD. CIT(A) OUGHT NOT TO HAVE IGNORED THE DEFINITIONS OF SECTIONS 2(14) AND 2(47) FOR DETERMINING THE FULL VALUE OF CONSIDERATION U/S. 50C OF THE ACT. 11. THE LD.CIT(A) OUGHT TO HAVE CLUBBED THE SUBJECT APPEAL WITH APPEAL NO. 10479/2016 - 17 FOR THE SAME ASSESSMENT YEAR SINCE THE TOTAL INCOMES OF BOTH ASSESSMENT ORDERS EFFECTIVELY NEED TO BE CLUBBED TOGETHER . FOR THESE AND OTHER GROUNDS THAT MAY BE URGED AT THE TIME OF APPEAL HEARING, IT IS PRAYED THAT ADDITION MADE B Y THE AO BE RESTORED. 3 . FACTS OF THE CASE IN BRIEF ARE THAT ASSESSEE HAS SOLD LAND ADMEASURING 4.00 ACRES BEARING S.NO. 18/2, 19/2 & 29/2 SITUATED AT CHINAGADILI VILLAGE, VISAKHAPATNAM VIDE SALE DEED NO. 1252/2010 , DATED 03/04/2010 FOR A SALE CONSIDERATION OF RS. 45.00 LAKHS . THE AO HAS NOTED THAT THE VALUE OF THE PROPERTY (SRO) WAS 4 ITA NO S . 17 & 18/VIZ/2020 C.O.NOS. 12 & 13/VIZ/2020 ( RAVI VENKATESWARLU ) AT RS. 10,53,18,400/ - . ON VERIFICATION OF TH E RECORDS, IT WAS NOTICED THAT THE ASSESSEE HAS NOT DISCLOSED THIS TRANSACTION IN HIS RETURN OF INCOME FILE D, THOUGH THE ASSESSEE IS LIABLE FOR CAPITAL GAINS ON THE PROFIT DERIVED TOWARDS TRANSFER OF PROPERTY, AS PER THE PROVISIONS OF SECTION 50C OF THE ACT. ACCORDINGLY, THE CASE OF THE ASSESSEE WAS REOPENED BY ISSUING NOTICE U/SEC. 148 AND ASSESSMENT WAS COMP LETED U/SEC. 143(3) R.W.S. 147 OF THE ACT DATED 30/12/2016. IN THE ASSESSMENT ORDER THE AO HAS OBSERVED THAT THE ASSESSEE HAS SOLD THIS LAND TO M/S. VISAKHA INDUSTRIAL GASES PVT. LTD. REPRESENTED BY ITS MAN A GING DIRECTOR SRI BIKKINA SATYANARAYANA FOR A SALE CONSIDERATION OF RS. 45.00 LAKHS . THE AO FURTHER NOTED THAT SRI BIKKINA SATYANARAYANA HAS PAID STAMP DUTY OF RS. 30,92,975/ - AND DIFFERENCE OF TRANSFER DUTY OF RS. 20,16,370/ - AND DEFICIT IN REGISTRATION FEE OF RS. 5,04,095/ - AS FIXED BY THE COLLECTOR UNDER SUB - RULE(1) OF RULE (7) OF THE A.P. STAMP RULES, 1975 READ WITH A.P. AMENDMENT ACT 17/1985 ON THE DETERMINED VALUE OF RS.10,53,18,400/ - VIDE PROCEEDINGS NO. 123/G 2/47 - A / 2011 , DATED 10/02/2011 AND IT WAS HEL D THAT THE INSTRUMENT IS PROPERL Y STAMPED . THE AO FURTHER NOTED THAT ON VERIFICATION OF THE SALE DEED EXECUTED ON 09/03/2011, THE GOVERNMENT VALUE HAS BEEN MENTIONED AS RS. 45.00 LAKHS AND STAMP DUTY WAS PAID ACC ORDINGLY. HOWEVER, SUBSEQU E NT L Y, THE 5 ITA NO S . 17 & 18/VIZ/2020 C.O.NOS. 12 & 13/VIZ/2020 ( RAVI VENKATESWARLU ) SRO HAS REVISED THE GOVERNMENT VALUE AT RS. 10,53,18,400/ - AND COLLECTED ADDITIONAL STAMP DUTY OF RS. 56,13,440/ - FROM THE PURCHASER M/S.VISAKHA INDUSTRIAL GASES PVT. LTD. THUS, THE PROVISIONS OF SECTION 50C ARE APPLICATION TO THE SELLER - ASSESSEE AS THE SALE CONSIDERATION HAS TO BE TAKEN AT RS. 10,53,18,400/ - AND THEREFORE THE ASSESSEE IS LIABLE FOR CAPITAL GAINS ON THE PROFIT DERIVED TOWARDS TRANSFER OF PROPERTY AND ASSESSEE WAS ASKED TO EXPLAIN WHY SECTION 50C SHOULD NOT BE APPLIED. IN RESPONSE TO THAT, THE ASSESSEE MADE WRITTEN SUBMISSIONS DATED 29/12/2016 AND CONTENDED THAT THE SUBJECT PROPERTY WAS LISTED AS GOVE RNMENT LAND AND THEREFORE THE ASSESSEE SOLD THE PROPERTY AT A DISTRESSED VALUE . THE LAND WAS BOUGHT WITHOUT ANY PRIOR KNOWLEDGE THAT THE LAND BELONGS TO GOVERNMENT AND INVOLVED IN SOME OTHER DISPUTES. WHEN I CAME TO KNOW THE FACT, I SOLD AT A VERY LOW PRICE TO GET RID OF THE PROPERTY. IN ANY WAY, IT IS NOT ACCEPTED TO YOUR PROPOSAL OF CALCULATING THE MARKET PRICE AS REVISED MARKET PRICE AS IT WILL NOT BE FAIR TO CHARGE ME FOR THE REVISION OF MARKET VALUE AFTER MANY MONTHS OF REGISTRATION, BECAUSE THE PURCHASER PAID THE STAMP DUTY AS PER MARKET VALUE PREVAILING ON THE DATE OF REGISTRATION AND THE INTEREST IN THE PROPERTY WAS TOTALLY TRANSFERRED TO THE PURCHASER. THE AO AFTER 6 ITA NO S . 17 & 18/VIZ/2020 C.O.NOS. 12 & 13/VIZ/2020 ( RAVI VENKATESWARLU ) CONSIDERING THE EXPLANATION OF THE ASSESSEE WAS OF THE OPINION THAT THE S RO VALUE AS DEEMED CONSIDERATION TOWARDS SALE OF PROPERTY I.E. RS.10,53,18,400/ - AS PER THE PROVISIONS OF SECTION 50C OF THE ACT. ACCORDINGLY, LONG TERM CAPITAL GAIN IS CALCULATED IN THE HANDS OF THE ASSESSEE AND ASSESSMENT IS COMPLETED. 4 . AGGRIEVED BY T HE ORDER OF THE AO, THE ASSESSEE WENT ON APPEAL BEFORE THE LD. CIT(A) . IT WAS SUBMITTED BEFORE THE LD.CIT(A) THAT THE LAND PURCHASED AND SOLD BY THE ASSESSEE IS A GOVERNMENT LAND AND THE SRO VALUE HAS NO APPLICATION. THE SALE CONSIDERATION RECEIVED BY THE ASSESSEE HAS TO BE CONSIDERED AS DEEMED CONSIDERATION, HENCE, SECTION 50C HAS NO APPLICATION. IT WAS FURTHER SUBMITTED BEFORE THE AO THAT THE ASSESSEE HAS OBJECT ED FOR ADOPTION OF SRO VALUE AND THE AO REFERRED THE MATTER TO THE DVO . THE AO WITHOUT CONSIDERING THE REPORT OF THE DVO APPLI ED SECTION 50C WHICH IS NOT ACCORDING TO L AW . THE LD. CIT(A) AFTER CONSIDERING THE SUBMISSION OF THE ASSESSEE DIRECTED THE AO TO DELETE THE ADDITION . 5 . ON BEING AGGRIEVED , REVENUE CARRIED THE MATTER IN APPEAL BEFORE THIS TRIBUNAL. 6 . LD.DR STRONGLY SUPPORTED THE ORDER OF THE AO, WHEREAS LD. COUNSEL FOR THE ASSESSEE HAS SUPPORTED THE ORDER OF THE LD.CIT(A). 7 ITA NO S . 17 & 18/VIZ/2020 C.O.NOS. 12 & 13/VIZ/2020 ( RAVI VENKATESWARLU ) 7. WE HAVE HEARD BOTH THE PARTIES, PERUSED THE MATERIAL AVAILABLE ON RECORD AND GONE THROUGH ORDERS OF THE AUTHORITIES BELOW. 8 . THE ASSESSEE HAS SOLD 4.00 ACRES OF LA ND TO M/S. VISAKHA INDUSTRIAL GASES PVT. LTD. FOR A SALE CONSIDERATION OF RS. 45.00 LAKHS BY SALE DEED NO. 1252/2010 , DATED 03/04/2010. THE AO BY CONSIDERING THE REVISED SRO RATES, ADOPTED THE SALE VALUE OF THE PROPERTY AT RS. 10,53,18,400/ - AND ASSESSEE WAS ASKED TO EXPLAIN WHY SEC. 50C SHOULD NOT BE INVOKED . BEFORE THE AO, THE ASSESSEE HAS SUBMITTED THAT THE LAND PURCHASED BY HIM IS A GOVERNMENT LAND AND THEREFORE TO GET RID OF THE LAND , HE SOLD IT FOR A CHEAP PRICE AND SRO VALUE HAS NO APPLICATION. AFTER CONSIDERING THE EXPLANATION OF THE ASSESSEE THE AO IS THE OPINION THAT THE PURCHASER HAS PAID THE ADD ITIONAL STAMP DUTY SUBSEQUENT TO THE SALE, THEREFORE SECTION 50C APPLIED TO THE ASSESSEES CASE AND CONSIDERED THE SRO VALUE OF THE PROPERTY AT RS. 10,53,18,400/ - . O N APPEAL , LD. CIT(A) BY CONSIDERING THE DVOS REPORT AND ALSO THE SUBMISSIONS OF THE ASSES SEE GAVE A FINDING THAT AS PER TEHSILDAR , THE LAND IS A GOVERNMENT LAND, THE SAME IS REPORTED TO THE DVO. THE ASS ESSEE HAS SOLD THE LAND TO M/S. VISAKHA INDUSTRIAL GASES PVT. LTD. THROUGH SALE - CUM - GPA PENDING FOR FINAL REGISTRATION FOR THE REASON THAT THE SUBJECT LANDS ARE GOVERNMENT LANDS. HE GAVE 8 ITA NO S . 17 & 18/VIZ/2020 C.O.NOS. 12 & 13/VIZ/2020 ( RAVI VENKATESWARLU ) A FURTHER FINDING THAT BASED ON THE DVOS REPORT THE LAND WHICH IS SUBJECT MATTER OF THE SALE DEED DATED 03/04/2010 CANNOT BE VALID BEC AUSE IT IS A GOVERNMENT LAND . THE LD. CIT(A) GAVE FURTHER FINDING THAT THE DVO BY LETTER DATED 29/12/2016 STATED THAT SUBJECT MATTER OF THE LAND IS A GOVERNMENT LAND , HENCE, THE SAME CANNOT BE VALID . WHEN THE LAND BELONGING TO THE GOVERNMENT IS SOUGHT TO BE TRANSACTED BY THE PRIVATE PARTIES, THE VALUE HAS TO BE TREATED NIL IN AS MUCH THE PRIVATE PARTIES DO NOT HAVE ANY RIGHT TO TRANSACT WITH GOVERNMENT LAND . THE ASSESSEE HAS ALREADY RECEIVED SALE CONSIDERATION OF RS. 45.00 LAKHS AND HE GAVE A FIN DING THAT THE SALE IS DISTRESSED ONE IS BORNE OUT OF RECORDS. T HEREFORE THE CONSIDERATION ACTUALLY RECEIVED WOULD BE TAKEN FOR COMPUT ING CAPITAL GAINS. THE LD. CIT(A) IS DIRECTED THE AO TO DELETE THE ADDITION . FOR THE SAKE OF CONVENIENCE, THE RELEVANT PORTION OF THE ORDER OF THE LD. CIT(A) IS EXTRACTED AS UNDER: - 6.3.2. ON A CAREFUL PERUSAL OF THE REPLY FURNISHED BY THE THASILDAR TO THE D.VO AND ALSO THE' REPLY FURNISHED BY THE DYO TO THE ASSESSING OFFICER, I FIND THAT UNDISPUTEDLY THE SUBJE C T LANDS ARE GOVERNMENT LANDS. THE APPELLANT SOUGHT TO PURCHASE THESE LANDS BUT AT THE TIME OF REGISTRATION OF THE SALE C UM GPA THE APPELLANT CAME TO KNOW THAT THESE LANDS ARE GOVERNMENT LANDS AND WANTED TO GET RID OF THE SAME. AT THIS STAGE, THE BUYER VISAKHA INDU STRIAL GASES PRIVATE LIMITED ALSO KNEW THAT THE SALE CUM GPA WAS KEPT PENDING FO R FINAL R E GISTRATION FOR THE REASON THAT THE SUBJECT LANDS ARE GOVERNMENT LANDS. S U CH BEING THE CASE, THE TRANSACTION SALE OF PURPORTED LAND BETWEEN THE APPELLANT AND VISAKHA INDUSTRIAL GASES PRIVATE LIMITED IS IN RESPECT OF GOVERNMENT LAND. INA REGULAR CONTRACT FOR TRANSFER OF 9 ITA NO S . 17 & 18/VIZ/2020 C.O.NOS. 12 & 13/VIZ/2020 ( RAVI VENKATESWARLU ) PROPERTY THE VENDOR IS ABLE TO TRANSFER THE PROPERTY TO THE BUYER WITH ALL THE ATTACHED RIGHTS OF OWNERSHIP, POSSESSION AND ENJOYMENT OF THE PROPERTY . HOWEVER, IN THE CASE OF THE APPELLANT HE COULD NOT OWN THE LAND AS THE SALE CUM GPA WAS NOT FINALLY REGISTERED WHEN THE APPELLANT AGREED TO SELL THE LAND TO VISAKHA INDUSTRIAL OASES PRIVATE LIMITED AS THE SUB REGISTRAR HAD INFORMATION THAT THE LANDS WERE GOVERNMENT LANDS. THE PRIVATE PARTIES HAVE NO RIGHT TO TRANSACT WITH THE GOVERNMENT LAND AND AS SUCH THE APPELLANT WAS NOT IN A POSITION TO CONVEY PERFECT TITLE TO VI SAKHA INDUSTRIAL GASES PRIVATE LIMITED. THIS IS PRECISELY THE REASON THE DYO CLEARLY STATED THAT THE LAND WHICH IS - THE SUBJECT MATTER OF THE SALE DEED DT 3 . 4 . 2010 CANNOT BE VALUED . 6 . 3.4. AS PER THE PROVISIONS OF S.50C OF THE ACT THE SRO VALUE IS DEEMED T O BE THE FULL VALUE OF CONSIDERATION FOR THE PURPOSE OF COMPUTING THE CAPITAL G AINS ON SALE OF AN IMMOVABLE PROPERTY . HOWEVER, WHEN THE APPELLANT RAISES OBJECTION THE MATTER NEEDS TO BE REFERRED TO THE DYO. THE ASSESSING OFFICER HAS RIGHTFULLY REFERRED THE MATTER TO THE DYO. HOWEVER, WHEN THE DVO BROUGHT OUT CLEARLY IN HIS LETTER DL27.12.201 6 THAT THE SUBJECT LANDS ARE GOV ERNMENT LANDS AND HENCE THE SAME CANNOT BE VALUED , THE ASSESSING OFFICER IS NOT J USTIFIED IN ADOPTING THE SRO VALUE AS THE FULL VALUE OF THE CONSIDERATION. THE SRO VALUE WOULD BE THE FULL VALUE OF THE CONSIDERATION IF THE LAND IS SOLD BY THE GOVERNMENT TO WHOM THE LAND BELONGED. BE THAT AS IT MAY, WHEN THE LAND BELONGING TO THE GOVERNMENT IS SOUGHT TO BE TRANSACTED BY THE PRIVATE PARTIES TH E VALUE HAS TO B E TREATED AS NIL IN AS MUCH THE PRIVATE PARTIES DO NOT HAVE ANY RIGHT TO TRANSACT WITH GOVERNMENT LAND. HOWEVER, THE APPELLANT ACTUALLY RECEIVED A SUM OF RS.45,00,000 / - . THE FACT THAT THE SALE IS A DISTRESSED ONE IS BORNE OUT OF RECORDS, TH EREFORE THE CONSIDERATION ACTUALLY RECEIVED WOULD BE TAKEN FOR COMPUTING CAPITAL GAINS. AS AGAINST THIS THE INDEXED COST OF ACQUISITION ALLOWED BY THE ASSESSING OFFICER WAS RS. 64,29,750/ - WHICH IS NOT IN DISPUTE. THEREFORE, THE CAPITAL GAINS WORKS OUT TO RS. NIL. THE ASSESSING OFFICER IS DIRECTED TO DELETE THE ADDITION OF RS. 9,88,88,650/ - . THIS GROUND OF APPEAL IS ALLOWED. 9. WE HAVE GONE TH R OUGH THE ASSESSMENT ORDER AND ALSO THE ORDER OF THE LD. CIT(A) AND ALSO THE DVOS REPORT EXTRACTED BY THE LD. CIT(A). WE FIND THAT THE LD. CIT(A) GAVE A CATEGORICAL FINDING THAT THE SUBJECT MATTER OF THE LANDS ARE GOVERNMENT LANDS AS PER 10 ITA NO S . 17 & 18/VIZ/2020 C.O.NOS. 12 & 13/VIZ/2020 ( RAVI VENKATESWARLU ) THE TEHSILDAR TO THE DVO . THEREFORE, THERE IS NO SRO VALUE, THE VALUE FOR THE GOVERNMENT LANDS HAS TO BE TREATED AS NIL. THE AO WITHOUT CONSIDERING THE REPORT OF THE DVO, BY INVOKING SECTION 50C CONSIDERED THE SALE VALUE OF THE PROPERTY AT RS.10,53,18,400/ - IS DEEMED SALE CONSIDERATION. WE FIND THAT THE AO IS NOT CORRECT IN INVOKING SECTION 50C IN THIS CASE A S OBSERVED BY THE L D. CIT(A) . W E ARE ALSO FIND THAT THE LD. CIT(A) AFTER EXAMINING THE ENTIRE DETAILS DIRECTED THE AO TO DELETE THE ADDITION. WE FIND NO INFIRMITY IN THE ORDER PASSED BY THE LD. CIT(A). THUS, THIS APPEAL FILED BY THE REVENUE IS DISMISSED. ITA NO. 18/VIZ/20 20 10. FACTS OF THE CASE IN BRIEF ARE THAT IN THIS CASE ORIGINALLY ASSESSMENT WAS COMPLETED U/SEC.143(3) R.W.S. 147 ON 31/12/2016 BY DETERMINING TOTAL INCOME OF RS. 9, 90,84,760/ - ON ACCOUNT OF ADDITION OF RS. 9,88,88,650/ - TOWARDS LONG TERM CAPITAL GAIN ON SALE OF 4.00 ACRES OF LAND TO M/S. VISAKHA INDUSTRIAL GASES PVT. LTD. OUT OF 5.50 ACRES LAND HELD BY THE ASSESSEE. LATER ON, THE AO CAME TO NOTICE THAT ASSESSEE SOLD THE BALANCE LAND OF 1.50 ACRES TO RAVI HARINI AND VADDE MANJULA FOR A CONSIDERATION OF RS.16,70,000/ - AS AGAINST SRO VALUE OF RS. 3,94,94,000/ - . THEREFORE, THE AO REOPENED THE ASSESSMENT BY ISSUING NOTICE U/SEC. 148 , DATED 31/03/2018 . IT WAS SUBMITTED BEFORE THE AO 11 ITA NO S . 17 & 18/VIZ/2020 C.O.NOS. 12 & 13/VIZ/2020 ( RAVI VENKATESWARLU ) THAT HE SOLD THE LAND TO THE EXTENT OF 0.75 CENTS FOR A CONSIDERATION OF RS. 8,35,000/ - VIDE DOCUMENT NO. 1254/2010 DATED 08/04/2010. FURTHER SUBMITTED THAT THE REMAINING BALANCE OF LAND OF 0.75 CENTS FOR A CONSIDERATION OF RS. 8,35,000/ - VIDE DOCUMENT NO . 125 3 /2010 , DATED 08/04/2010 . HOWEVER, THE AO HAS NOT ACCEPTED THE EXPLANATION OF TH E ASSESSEE AND NOTED THAT THE SRO VALUE OF THE TOTAL PROPERTY IS OF RS. 3,94,94,400/ - , THEREFORE ACCORDING TO SECTION 50C THE SALE CONSIDERATION RECEIVED BY THE ASSESSEE IS OF RS. 3,94,94,400/ - . ACCORDINGLY, THE CAPITAL GAIN IS TAXED . 11. BEFORE THE LD. CIT(A), THE ASSESSEE HAS SUBMITTED THAT NOTICE ISSUED FOR REOPENING OF ASSESSMENT BY THE AO U/SEC. 148 , DATED 31/03/2018 IS BEYOND THE PERIOD OF 4 YEARS AND NO REASONS ARE COMMUNICATED TO THE ASSESSEE. THEREFORE, THE ASSESSMENT ORDER PASSED BY THE AO U/SEC. 143 R.W.S. 147 , DATED 22/12/2018 IS NOT IN ACCORDANCE WITH LAW, THEREFORE SAME HAS TO BE QUASHED. TH E LD.CIT(A) BY CONSIDERING THE EXPLANATION OF THE ASSESSEE DELETED THE ADDITION. ON MERITS ALSO, THE LD. CIT(A) DIRECTED THE AO TO DELETE THE ADDITION. 12. ON BEING AGGRIEVED, REVENUE CARRIED THE MATTER IN APPEAL BEFORE THIS TRIBUNAL. 13. LD.DR RELIED ON THE GROUNDS OF APPEAL . 12 ITA NO S . 17 & 18/VIZ/2020 C.O.NOS. 12 & 13/VIZ/2020 ( RAVI VENKATESWARLU ) 14. THE LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT THE DEPARTMENT HAS NOT RAISED ANY GROUND IN RESPECT OF VALIDITY OF REOPENING OF THE ASSESSMENT, HOWEVER, HE HAS SUBMITTED THAT REOPENING IS BEYOND 4 YEARS AND THE REASONS ARE NOT COMMUNICATED , THEREFORE THE LD. CIT(A) BY FOLLOWING THE DECISION OF THE HON'BLE ITAT, QUASHED THE NOTICE ISSUED BY THE AO AND SUBMITTED THAT SAME MAY BE UPHELD. ON MERITS ALSO, HE STRONGLY SUPPORTED THE ORDER OF THE LD. CIT(A). 15. WE HAVE HEARD BOTH THE PARTIES, PERUSED THE MATERIAL AVAILABLE ON RECORD AND GONE THROUGH ORDERS OF THE AUTHORITIES BELOW. 16. IN THIS CASE, THE ASSESSMENT WAS ALREADY COMPLETED ASSESSMENT U/SEC.143(3) R.W.S. 147 ON 31/12/2016. SUBSEQ U ENTLY, THE AO BY ISSUING NOTICE U/SEC. 148 OF THE ACT DATED 31/03/2018 REOPEN ED THE ASSESSMENT ON THE GROUND THAT THERE IS AN ESCAPEMENT OF INCOME. THE ASSESSEE HAS CONTENDED BEFORE THE LD. CIT(A) THAT NO REASONS ARE COMMUNICATED TO THE ASSESSEE. THIS FACT IS NOT DISPUTED BY THE DEPARTMENT EVEN THERE IS NO SPECIFIC GROUND RAISED IN RESPECT OF THE ISSUE OF NON - COMMUNICATION OF THE REASONS , H OWEVER, THE COUNSEL AR GUED THAT THIS GROUND BEFORE US . THEREFORE, WE ARE ADJUDICATED THIS GROUND. BEFORE THE LD. CIT(A), T HE ASSESSEE HAS RELIED ON THE DECISION OF 13 ITA NO S . 17 & 18/VIZ/2020 C.O.NOS. 12 & 13/VIZ/2020 ( RAVI VENKATESWARLU ) THE HON'BLE ITAT , VISAKHAPATNAM BENCH IN THE CASE OF ALAPATI KASI SUBRAYAN BY ORDER DATED 21/12/2018 IN ITA NOS. 113 - 116/VIZ/2018 AND ALSO THE DECISION OF THE HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF N. SURYA PRAKASH RAO IN ITTA NO. 156/2014 DATED 06/03/2014 . THE LD. CIT(A) BY CONSIDERING THE ABOVE JUDICIAL PRECEDENTS GAVE A FI N DING THAT NO REASONS ARE COMMUNICATED TO THE ASSESSEE THEREFORE AS PER THE DECISION OF THE ITAT IN A LAPATI KASI SUBRAYAN (SUPRA) AND ALSO BY CONSIDERING THE DECISION OF THE HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF N. SURYA PRAKASH RAO (SUPRA) , HE QUASHED 148 NOTICE AND CANCELLED THE ASSESSMENT ORDER DATED 22/12/2018. WE FIND NO INFIRMITY IN THE ORDER PASSED BY THE LD. CIT(A). 17. SO FAR AS MERITS OF THE CASE IS CONCERNED, THE LD. CIT(A) HAS HELD THAT WHILE ADJUDICATING THE APPEAL AGAINST THE ORIGINAL ASSESSMENT ORDER DATED 31/12/2016 HE HAS TAKEN THE VIEW VIDE HIS ORDER IN ITA NO. 10479/2016 - 17 THAT THE AO IS NOT JUSTIFIED IN ADOPTING SRO VALUE AS FULL VALUE OF CONSIDERATION IN RESPECT OF GOVERNMENT LAND TRANSACTED BY PRIVATE PARTIES. SINCE THE FACTS ARE IDENTICAL AND THE SUBJECT LAND IS THE SAME, FOLLOWING THE VIEW TAKEN BY HIM IN ITA NO. 10479 /2016 - 17, HE HOLD THAT THE CAPITAL GAINS HAS TO BE COMPUTED BY ADOPTING THE ACTUAL AMOUNT RECEIVED OF RS. 16,70,000/ - AS THE CONSIDERATION AND DIRECTED THE AO TO 14 ITA NO S . 17 & 18/VIZ/2020 C.O.NOS. 12 & 13/VIZ/2020 ( RAVI VENKATESWARLU ) DELETE THE ADDITION. THIS ISSUE HAS BEEN CONSIDERED BY US IN ITA NO. 17/VIZ/2020 . THE FACTS OF THIS APPEAL SHALL MUTATIS MUTANDIS SIMILAR TO ITA NO. 17/VIZ/2020. THEREFORE BY FOLLOWING OUR ORDER IN EARLIER PARAGRAPHS , WE FIND NO INFIRMITY IN THE ORDER PASSED BY THE LD.CIT(A). THUS, THIS APPEAL FILED BY THE REVENUE IS DISMISSED . C.O.NOS. 12 & 13/VIZ/2020 18. THE CROSS OBJECTIONS FILED BY THE ASSESSEE ARE ONLY SUPPORTIVE TO THE ORDERS OF THE LD. CIT(A). AS THERE ARE NO GRIEVANCE AGAINST THE ORDERS OF THE LD. CIT(A), THESE CROSS OBJECTIONS FILED BY THE ASSESSEE HAVE BECOME INFRUCTUOUS AND ARE D ISMISSED ACCORDINGLY . 19. IN THE RESULT, APPEAL S FILED BY THE REVENUE AND THE CROSS OBJECTIONS FILED BY THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON TH IS 2 5 T H DAY OF SEP. , 2020 . S D / - S D / - (D.S. SUNDER SINGH) (V. DURGA RAO) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 2 5 T H SEPT E MBER , 20 20 . VR/ - 15 ITA NO S . 17 & 18/VIZ/2020 C.O.NOS. 12 & 13/VIZ/2020 ( RAVI VENKATESWARLU ) COPY TO: 1. THE ASSESSEE - SRI RAVI VENKATESWARLU, D.NO. 48 - 3 - 6, KEETHI ENCLAVE, SREE NAGAR, VISAKHAPATNAM. 2. THE REVENUE ITO, WARD - 1(4), VISAKHAPATNAM. 3. THE PR. CIT - 1 , VISAKHAPATNAM. 4. THE CIT(A) - 1 , VISAKHAPATNAM. 5. THE D.R . , VISAKHAPATNAM. 6. GUARD FILE. BY ORDER (VUKKEM RAMBABU) SR. PRIVATE SECRETARY, ITAT, VISAKHAPATNAM.