Sri. Narayanan Krishnaanad, Ernakulam V. The ACIT, Circle-1, Non-Corporate, Ernakulam, Ernakulam

CO 32/COCH/2017

• Counselvise Citation: [2018] 123 COUNSELVISE.COM (IT) 4085 (ITAT-COCHIN)
• Duration Of Justice: 9 month(s) 7 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 14-08-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Next Hearing Date: 05-07-2018
• Assessment Year: 2013-2014
• Appeal Filed On: 07-11-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: DHANARAJ A
• Assessee Lawyers: A GOPALAKRISHNAN
• Keywords: Sale consideration of property below Jantri Value; Cost of acquisition; Fair market value; Valuation report
• Section: 32

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN BEFORE S/SHRI CHANDRA POOJARI, AM & GEORGE GEORGE K., JM I .T.A. NO S . 321 & 322 /COC H/ 2017 ASSESSMENT YEAR : 2 013 - 14 THE ASSISTANT COMMISSIONER OF INCOME-TAX, NON-CORPORATE, CIRCLE-1, KOCHI. VS. 1. SHRI NARAYAN KRISHNANAND, 40/109, 1 ST FLOOR, GOPAL RESIDENCY, THOTTEKKAT ROAD, ERNAKULAM, KOCHI-682 011. [PAN: ACMPK 3721E] 2. SHRI KRISHNA IYER NARAYANAN, CC41/511 (64/895) GOVARDHAN BUNGALOW, CHITTOR ROAD, KOCHI-682 035. [PAN:AASPN 1239N] (REVENUE - APPELLANT) (ASSESSEE - RESPONDENT) C.O. NO S . 31 & 32 /COCH/2017 (ARSG. OUT OF I.T.A. NOS. 321 & 322/COCH/2017 ASSESSMENT YEAR : 2 013 - 14 1. SHRI NARAYAN KRISHNANAND, 40/109, 1 ST FLOOR, GOPAL RESIDENCY, THOTTEKKAT ROAD, ERNAKULAM, KOCHI-682 011. [PAN: ACMPK 3721E] 2. SHRI KRISHNA IYER NARAYANAN, CC41/511 (64/895) GOVARDHAN BUNGALOW, CHITTOR ROAD, KOCHI-682 035. [PAN:AASPN 1239N] VS. THE ASSISTANT COMMISSIONER OF INCOME-TAX, NON-CORPORATE, CIRCLE-1, KOCHI. (ASSESSEE - APPELLANT) (REVENUE - RESPONDENT) REVENUE BY SHRI DHANARAJ A. SR. DR ASSESSEE BY SHRI A. GOPALAKRISHNAN, CA I.T.A. NO.321 &322/C/2017 & C.O. NOS.31&32/COCH/2017 2 D ATE OF HEARING 12 / 0 7 /2018 DATE OF PRONOUNCEMENT 14 / 0 8 /2018 O R D E R PER CHANDRA POOJARI: THESE APPEALS FILED BY THE REVENUE IN THE CASE OF DIFFERENT ASSESSES ARE DIRECTED AGAINST DIFFERENT ORDERS OF THE CIT(A) AND PERTAIN TO THE ASSESSMENT YEAR 2013-14. THE ASSESSES HAVE ALSO FILED CROSS OBJECTIONS AGAINST THE APPEALS FILED BY THE REVENUE. 2. SINCE THE ISSUES ARE INTER-RELATED, THEY WERE CLUBBED TOGETHER, HEARD TOGETHER AND ARE BEING DISPOSED OFF BY THIS COMMON ORDER. 3. THE FIRST COMMON GROUND IN BOTH THESE APPEALS IS WITH REGARD TO THE DETERMINATION OF FAIR MARKET VALUE AT RS.30,000/- PER ARE AS ON 01/04/1981 WHILE COMPUTING THE CAPITAL GAIN ARISING OUT OF THE SALE OF THE PROPERTY. 4. THE FACTS OF THE CASE AS NARRATED IN THE CASE OF SHRI KRISHNA IYER NARAYANAN IS CONSIDERED FOR ADJUDICATION. FOR THE ASSESSMENT YEAR UNDER CONSIDERATION, THE ASSESSEE DECLARED TOTAL INCOME OF RS.1,03,61,050/- WHICH INCLUDED LONG TERM CAPITAL GAIN AT RS.84,87,298/- IN THE FOLLOWING MANNER: I.T.A. NO.321 &322/C/2017 & C.O. NOS.31&32/COCH/2017 3 LONG TERM CAPITAL GAIN RS.83,37,298/- SHORT TERM CAPITAL GAIN RS. 1,50,000/- INCOME CHARGEABLE TO CAPITAL GAIN AS ADMITTED RS.84,87,298/- 4.1 IT WAS OBSERVED BY THE ASSESSING OFFICER THAT THE ASSESSEE HAD SOLD THE LANDED PROPERTY AT KALAMASSERY TO ONE BUILDER M/S. ASSET HOMES PVT. LTD. FOR A CONSIDERATION OF RS.4,06,24,800/-T AND CLAIMED EXEMPTION U/S. 54EC OF THE ACT FOR RS.1,00,00,000/- HAVING INVESTED IN REC BONDS. WHILE COMPUTING THE CAPITAL GAIN TO DETERMINE THE COST OF ACQUISITION, THE ASSESSEE ADOPTED FAIR MARKET VALUE OF THE LAND AT RS.41,000/- PER CENT AS ON 1/4/1981. THE ASSESSING OFFICER NOT AGREEING WITH THE FMV OF THE LAND, CALLED FOR REPORT FROM SRO, EDAPALLY WHICH REPORTED VIDE ITS LETTER 21/07/2015 THAT THE FAIR MARKET VALUE OF THE ASSESSEES LAND AS ON 1.4.1982 WAS AT RS.2350/- PER ARE. ON THAT BASIS, THE ASSESSING OFFICER DETERMINED THE FMV OF THE LAND AS ON 1.4.1982 AT RS.5,806 PER CENT. 4.2 HOWEVER, BY NOTICING THE TREND OF SRO VALUE FROM 1982 TO 1983 (I.E. THERE HAS BEEN REDUCTION IN VALUE), AFTER CONSIDERING THE SRO VALUES FROM 1982 TO 1990 AND ALSO THE BALANCE OF EQUITY, THE FAIR MARKET VALUE OF THE ASSESSEES LAND WAS DETERMINED AT RS.6,000/- PER CENT. 5. THE ASSESSEE WENT IN APPEAL BEFORE THE CIT(A). THE CIT(A) OBSERVED THAT FOR THE PURPOSE OF REGISTRATION, THE STAMP DUTIES WERE GROSSLY UNDERVALUED. THEREFORE, IT CANNOT BE CONSIDERED FOR DETERMINING THE FMV OF THE ASSESSEES I.T.A. NO.321 &322/C/2017 & C.O. NOS.31&32/COCH/2017 4 LAND AS ON 1/4/1981. ACCORDINGLY, THE CIT(A) DIRECTED THE ASSESSING OFFICER TO ADOPT THE RATE OF RS.30,000/- PER CENT AS FMV AS ON 01/04/1981 AS AGAINST THE FMV ADOPTED BY THE ASSESSEE AT RS. 41,000/- PER CENT AS ON 1/4/1981. 6. AGAINST THIS, THE ASSESSEE HAS ALSO FILED CROSS OBJECTIONS AGAINST BOTH THE REVENUES APPEALS, SEEKING TO DETERMINE THE FMV OF THE LAND AT RS.41,000/- AS ON 1/4/1981. 7. THE LD. DR DREW OUR ATTENTION TO THE REPORT ISSUED BY THE SRO DATED 21/07/2015 WHEREIN THE FAIR MARKET VALUE OF THE PROPERTY OF THE ASSESSEES LAND AS ON 1.4.1982 WAS AT RS.2350/- PER ARE. ACCORDINGLY, THE AO WHILE MAKING PROPER ADJUSTMENT ARRIVED AT THE FMV OF THE PROPERTY AS ON 01/04/1981 AT RS. 6000/- PER CENT. THE CIT(A) HELD THAT THERE WAS NO MATERIAL TO COME TO THE CONCLUSION THAT THE FMV OF THE PROPERTY AS ON 01/04/1981 IS AT RS.30,000/-PER CENT. 8. THE LD. AR SUBMITTED THAT THE ASSESSEES LAND IS ACTUALLY COMPARABLE WITH THE PROPERTY DETAILS FURNISHED BY THE SRO VIDE HIS LETTER DATED 21/07/2015. THE LD. AR SUBMITTED THAT THE ASSESSEE HAS ADOPTED THE FMV AS ON 01/04/1981 AT RS.41,000/- WHICH IS NOT BASED ON THE REVERSED INDEX METHOD. HAD THE ASSESSEE ADOPTED THE REVERSED INDEX METHOD, THE FMV OF THE PROPERTY SHOULD HAVE BEEN AT RS.79,965/- PER CENT. AS AGAINST THIS, THE ASSESSEE CLAIMED ONLY RS.41,000/- I.T.A. NO.321 &322/C/2017 & C.O. NOS.31&32/COCH/2017 5 PER CENT WHICH IS BASED ON THE REGISTERED VALUERS REPORT AND IT IS TO BE ADOPTED. THE AO OR THE CIT(A) CANNOT SUBSTITUTE WITH A NEW VALUE IN PLACE OF THE VALUE ADOPTED BY THE REGISTERED VALUER WITHOUT BRINGING ANY MATERIAL ON RECORD. REGARDING SRPS VALUE, THE LD. AR SUBMITTED THAT THE SRO THROUGH ITS LETTER 21/07/2015 FURNISHED THE STAMP DUTY OF THE LAND AS ON 01/04/1982 AT RS.5806/- PER CENT. SINCE THERE IS NO SPECIFIC REFERENCE OF ANY LAND IN THE SAID LETTER OF THE SRO, THE AO SENT ANOTHER LETTER TO THE SRO DATED 27/11/2015 TO ASCERTAIN THE VALUE OF ATLEAST FOUR TRANSACTIONS RELATED TO THE PROPERTY SITUATED IN SURVEY NUMBERS OF THE ASSESSEES PROPERTY. THE SRO FURNISHED DETAILS THROUGH HIS REPLY DATED 02/12/2015 IN WHICH THE STAMP DUTY VALUE PER CENT WAS AT RS.3,491/-, RS.5,119/-, RS.5,319/- AND RS.6,124/- FOR FOUR YEARS, 1983, 1985, 1987 AND 1990 RESPECTIVELY.. THE VALUE MENTIONED BY THE SRO IN HIS LETTER DATED 02/12/2015 IS NOT AT ALL RELATING TO THE LAND SIMILAR TO THE ASSESSEES LAND AND ASSESSEES LAND WAS DRY LAND AS AGAINST THE LAND MENTIONED IN SROS REPORT WHICH IS WET LAND. BEING SO, IT CANNOT BE COMPARED WITH EACH OTHER. 8.1 THE LD. AR RELIED ON THE FOLLOWING CASE LAWS: 1) CIT VS. ASHVEN DATLA (218 TAXMAN 74) (AP) 2) ITO VS. ASHVEN DATLA ( ITAT, HYDERABAD BENCH ITA NO. 197/HYD/2010 DATED 29/10/2010) 3) JAHANGANJ COLD STORAGE VS. ACIT (ITAT, AGRA BENCH ITA NO.365/AGR./2006 DT.13/04/2010) 4) DEEN DAYAL RATHI VS. ITO (ITAT, JODHPUR BENCH SA NO. 25/JODH/2013 DATED 04/04/2013 5) DY CIT VS. SHRI RAJENDRA KUMAR SINGHVI (ITAT, JODHPUR BENCH ITA NO.313/JODH/2010 DATED 10/07/2013) I.T.A. NO.321 &322/C/2017 & C.O. NOS.31&32/COCH/2017 6 6) SATYA DEV SHARMA VS. ITO (2014) 46 TAXMANN.COM 149) (ITAT, JAIPUR BENCH 7) LATE SHANTADEVI GAEKWAD VS. DCIT (2012) 22 TAXMANN.COM 30 (GUJ.) 8) ACIT VS. SUNDRI K. THAWANI (ITA NO. 3026/MUM/2011 DATED 21/12/2012 ITAT MUMBAI BENCH) 9. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RECORD. IN THIS CASE, THE ASSESSEE TRANSFERRED THE LANDED PROPERTY SITUATED AT KALAMASSERY TO ONE BUILDER M/S. ASSET HOMES PVT. LTD. FOR A CONSIDERATION OF RS.4,06,24,800/- SINCE THE ASSESSEE ACQUIRED THE LANDED PROPERTY PRIOR TO 01/04/1981, THE ASSESSEE ADOPTED THE TOTAL COST OF LAND IN THE FOLLOWING MANNER: COST PER CENT AS ON 01/04/1981 RS.41,000/- PER CENT INDEX COST OF ACQUISITION 8.52 (852/100) AREA IN CENTS GIVEN TO DEVELOPER 28.42 TOTAL COST OF PURCHASE RS.41000*8.52*28.42 RS.99,27,697/- 9.1 ACCORDING TO THE ASSESSING OFFICER, THE COST OF ACQUISITION OF THE PROPERTY AS ON 01/04/1981 AT RS.41,000/- PER CENT WAS ON THE HIGHER SIDE. ON ENQUIRY FROM THE SRO, THE ASSESSING OFFICER FIXED THE COST OF ACQUISITION AT RS.5806 PER ARE AS ON 01/04/1982. AS AGAINST THIS, THE CIT(A) FIXED THE COST OF ACQUISITION AT RS.30,000/- PER CENT AS ON 01/04/1981. THE BASIS OF THE SRO FOR ADOPTING THE FAIR MARKET VALUE AT RS.5806/- PER CENT AS ON 01/04/1981 WAS NOT MENTIONED IN THE SROS LETTER DATED 21/07/2015. THE SRO SENT ANOTHER LETTER ON 02/12/2015 WHICH READS AS FOLLOWS: I.T.A. NO.321 &322/C/2017 & C.O. NOS.31&32/COCH/2017 7 NO.232/2015 OFFICE OF THE SUB-REGISTRAR, EDAPALLY, DATED :02/12/2015 FROM SUB REGISTRAR EDAPALLY TO THE ASSISTANT COMMISSIONER OF INCOME TAX, NON-CORPORATE CIRCLE-1(1) , ROOM NO. 306, IIIRD FLOOR, C.R. BUILDING I.S. ROAD, ERNAKULAM, KOCHI-682 018. SIR SUB: REGISTRATION DEPARTMENT APPROXIMATE MARKET VALUE SUBMITTING REG. REF: LR. F. NO. PAN.99/ENQUIRY/2013-14 DATED 27/11/2015. YOUR KIND AT IS INVITED TO THE ABOVE SUBJECT. APPROXIMATE MARKET VALUE OF SURVEY NUMBER OR NEAR SURVEY NUMBER OF 1173 OF THRIKKAKARA NORTH VILLAGE IS GIVEN BELOW. IT MAY BE NOTED THAT THE STATUTORY VALUATION AUTHORITY OF LAND IS REVENUE DEPARTMENT. YEAR APPROXIMATE MARKET VALUE/ARE 1993 14.13 1985 2072 1987 2182 1990 2479 KINDLY NOTE THAT THE VALUE SHOWN ABOVE CANNOT BE TREATED AS AUTHORITATIVE, SINCE THE REGISTERING OFFICER IS NOT A VALUATION AUTHORITY. ALL THE MORE A MARKET VALUE OF LAND FIXED ACCORDING TO ITS CLASSIFICATION LIKE RESIDENTIAL PLOT WITH PWD ROAD ACCESS, RESIDENTIAL PLOT WITH PRIVATE ROAD ACCESS, RESIDENTIAL PLOT WITH CORPN. MU., PANCH, ROAD ACCESS, NILAM ETC. YOURS FAITHFULLY (SD/-) SUB REGISTRAR, EDAPALLY I.T.A. NO.321 &322/C/2017 & C.O. NOS.31&32/COCH/2017 8 9.2 THE ASSESSEE HAD FILED A SURVEYORS CERTIFICATE DATED 22/02/2016 BEFORE THE AO TO CONFIRM THAT, EVEN THOUGH SITUATED IN THE SAME SURVEY NUMBER, THE PROPERTIES UNDER CONSIDERATION IN THE FOUR TRANSACTIONS AFORESAID POINTED OUT BY THE SRO ARE PURE WET LAND (PADDY FIELDS), WHEREAS THE PROPERTY OF THE ASSESSEE WAS DRY LAND AND MUCH HIGHER IN VALUE. IT WAS SUBMITTED THAT PADDY FIELD CAN BE USED ONLY FOR AGRICULTURAL PURPOSES AND THOSE AGRICULTURAL LANDS CANNOT BE USED FOR ANY COMMERCIAL PURPOSES. THEREFORE, IT WAS SUBMITTED THAT THE VALUE OF THE WET LAND CERTIFIED BY THE SRO CANNOT BE ADOPTED TO DETERMINE THE FMV OF THE LAND TRANSFERRED/SOLD BY THE ASSESSEE. HE OBSERVED THAT THE STAMP DUTY FOR WET LAND/AGRICULTURAL LAND CANNOT BE COMPARED WITH THE ASSESSEES LAND. THE ASSESSEE HAS FURNISHED THE REGISTERED VALUERS CERTIFICATE WHICH SHOWS THE VALUE OF THE PROPERTY AS ON 01/04/1981 AT RS.41,000/- PER CENT BY RESTRICTING THE FAIR MARKET VALUE TO RESERVED INDEXATION VALUE OF GLV DECLARED BY THE KERALA GOVERNMENT IN 2010. IT WAS THE CONTENTION OF THE ASSESSEE THAT THE ASSESSEE HAS NOT APPLIED DIRECT REVERSE INDEXATION METHOD ON THE MARKET VALUE AS ON 2010 AND IF IT HAD APPLIED THE FMV AS ON 01/04/1982, IT WOULD HAVE BEEN RS.79,965/- PER CENT. THE FMV ADOPTED BY THE ASSESSEE AS ON 01/04/1981 WAS ONLY 50% OF THE ABOVE VALUE OF RS.79,965 WHICH IS VERY REASONABLE. 9.3 IN OUR OPINION, THE VALUE MENTIONED BY THE SRO AS ON 01/04/1981 IS ON THE LOWER SIDE AND CANNOT BE CONSIDERED AS THE EXACT VALUE APPLICABLE TO THE ASSESSEES CASE. THE VALUE MENTIONED BY THE SRO IS NOT BASED ON SPECIFIC I.T.A. NO.321 &322/C/2017 & C.O. NOS.31&32/COCH/2017 9 COMPARABLE INSTANCE OF CASE AND IT IS ONLY A ROUGH ESTIMATE WHICH CANNOT BE ACTED UPON AND CANNOT BE GIVEN ANY CREDIT. THE SRO HAS NOT MENTIONED ABOUT THE NATURE OF THE PROPERTY WHILE ADOPTING THE FAIR MARKET VALUE AND THAT VALUE WAS NOT PREPARED SCIENTIFICALLY. BEING SO, THE ASSESSING OFFICER IS NOT JUSTIFIED IN PLACING RELIANCE ON SUCH VALUE GIVEN BY THE SRO. THE LD. DR MADE AN ARGUMENT BEFORE US THAT THE COST INFLATION INDEX CANNOT BE APPLIED IN THE REVERSE DIRECTION. IN THE PRESENT CASE, IT CANNOT BE SAID THAT THERE WAS AN APPLICATION OF COST INFLATION INDEX IN THE REVERSE DIRECTION BY THE ASSESSEE. THE ASSESSEE HAS FILED A COPY OF VALUATION REPORT FROM THE REGISTERED VALUER. THE REGISTERED VALUER HAS TAKEN INTO CONSIDERATION THE LOCATION OF THE PROPERTY, ITS ADVANTAGE AND THE GLV DECLARED BY THE KERALA GOVERNMENT IN 2010 FOR ADOPTING THE FMV AS ON 01/04/1981 AT RS.79,965/-. ON THAT BASIS, THE REGISTERED VALUER FIXED THE FMV AT RS.41,000/- PER CENT. AGAINST THIS, THE CIT(A) ADOPTED RS.30,000/- PER CENT WHICH IS VERY REASONABLE AND MODERATE. THEREFORE, IN OUR OPINION, THE ESTIMATION OF FMV BY THE CIT(A) AT RS.30,000/- PER CENT AS ON 01/04/1981 IS TO BE CONFIRMED. 9.4 FURTHER, IN THE CASE OF CIT VS. ASHVEN DATLA (218 TAXMAN 74), THE ANDHRA PRADESH HIGH COURT HAD HELD THAT FOR COMPUTING CAPITAL GAIN U/S 48 OF THE ACT, THE FMV OF THE PROPERTY CANNOT BE DETERMINED ON THE BASIS OF GUIDELINE VALUE EMANATING FROM THE SUB-REGISTRARS OFFICER WHICH IS NOT SCIENTIFICALLY PREPARED. THE ANDHRA PRADESH HIGH COURT UPHELD THE DECISION OF THE ITAT, HYDERABAD I.T.A. NO.321 &322/C/2017 & C.O. NOS.31&32/COCH/2017 10 BENCH RENDERED IN THE CASE OF ACIT VS. SREE NARSIMHA RAO AS HUF IN ITA NO. 1240/HYD/2007 DATED 26/9/2008 WHEREIN IT WAS HELD THAT IT IS PRUDENT ON THE PART OF THE LOWER AUTHORITIES TO ESTIMATE THE FAIR MARKET VALUE AS ON 01/04/1981 ON THE BASIS OF VALUATION OFFICERS REPORT WHICH WAS ARRIVED AT BY THE REVERSED INDEXATION METHOD. ACCORDINGLY, WE DO NOT FIND ANY INFIRMITY IN THE FINDINGS OF THE CIT(A) ON THIS ISSUE AND THE SAME IS CONFIRMED. THIS GROUND OF APPEALS OF THE REVENUE IS REJECTED. THUS, THE APPEAL OF THE REVENUE IN ITA NO. 321/COCH/2017 IS DISMISSED. 10. THE NEXT GROUND IN ITA NO. 322/COCH/2017 IS WITH REGARD TO DELETION OF ADDITION WITH A DIRECTION TO THE AO TO ALLOW CREDIT FOR PAYMENT OF ADDITIONAL CONSIDERATION PAID AMOUNTING TO RS.16,70,275/-. 11. THE FACTS OF THE CASE ARE THAT THE ASSESSEE PAID AN AMOUNT OF RS.16,70,275/- OVER AND ABOVE THE AGREEMENT VALUE OF LAND. 12. ON APPEAL, THE CIT(A) OBSERVED THAT THE ASSESSEE OBTAINED A RECEIPT FROM THE SELLERS SAINU RAHIM AND SABITHA RAHIM AND SUBMITTED THE SAME BEFORE THE AO. THE AO DID NOT ALLOW CREDIT FOR THIS ADDITIONAL CONSIDERATION PAID. THE CIT(A) FOUND THAT THE COPY OF THE RECEIPT FURNISHED BY THE ASSESSEE AS GENUINE. ACCORDING TO THE CIT(A), THE AO HAS ALSO NOT CAST ANY DOUBTS ABOUT THE GENUINENESS OF THE RECEIPT IN THE ASSESSMENT ORDER. THE CIT(A) OBSERVED THAT IF I.T.A. NO.321 &322/C/2017 & C.O. NOS.31&32/COCH/2017 11 THE AO HAD ANY DOUBTS, HE COULD HAVE CONDUCTED ENQUIRY WITH SAINU RAHIM AND SABITHA RAHIM. THE CIT(A) WAS OF THE OPINION THAT IN THE ABSENCE OF ANY CONTRARY EVIDENCE AVAILABLE ON RECORDS OF THE ASSESSEE, THE AO WAS NOT FAIR IN REJECTING THE CLAIM OF THE ASSESSEE AND DIRECTED THE AO TO ALLOW CREDIT FOR PAYMENT OF ADDITIONAL CONSIDERATION PAID AMOUNTING TO RS.16,70,275/-. 13. AGAINST THIS, THE REVENUE IS IN APPEAL BEFORE US. 14. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RECORD. THE ASSESSEE HAD CLAIMED TO HAVE PAID AN AMOUNT OF RS.16,70,275/- AS ADDITIONAL CONSIDERATION OVER AND ABOVE THE DOCUMENTED VALUE OF THE LAND. THE ASSESSEE PRODUCED A RECEIPT FROM THE SELLERS SAINU RAHIM AND SABITHA RAHIM WHICH WAS FILED BEFORE THE AO AND ON THAT BASIS, THE CIT(A) GAVE RELIEF TO THE ASSESSEE REGARDING PAYMENT OF ADDITIONAL CONSIDERATION. THE ASSESSEE PLEADED THAT HE HAD FURNISHED THE COPY OF THE RECEIPT BEFORE THE CIT(A) AND IT WAS FOUND TO BE GENUINE. IF THE AO HAD ANY DOUBT REGARDING THE GENUINENESS OF THE CLAIM OF THE ASSESSEE , HE COULD HAVE VERIFIED WITH SAINU RAHIM AND SABITHA RAHIM. WITHOUT VERIFYING WITH THEM OR PROVIDING ANY EVIDENCE AGAINST THE ASSESSEE, THE AO WAS NOT FAIR IN REJECTING THE CLAIM OF THE ASSESSEE. THE CIT(A) AFTER APPRECIATING THE FACTS OF THE CASE AND EVIDENCE AVAILABLE ON RECORD, DIRECTED THE AO TO ALLOW CREDIT FOR PAYMENT OF ADDITIONAL CONSIDERATION PAID AMOUNTING TO RS.16,70,275/-. WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE CIT(A) AND CONFIRM THE SAME. I.T.A. NO.321 &322/C/2017 & C.O. NOS.31&32/COCH/2017 12 HENCE, THIS GROUND OF APPEAL OF THE REVENUE IS DISMISSED. THE APPEAL OF THE REVENUE IN ITA NO. 322/COCH/2017 IS DISMISSED. C.O. NO. 31/COCH/2017 & C.O. NO. 32/COCH/2017 15. THE FIRST COMMON GROUND IN THE CROSS OBJECTIONS IS WITH REGARD TO ADOPTION OF FMV AT RS. 30,000/- PER CENT AS ON 01/04/1981 INSTEAD OF RS.41,000/- PER CENT AS CLAIMED BY THE ASSESSEE. SINCE WE HAVE CONFIRMED THE CIT(A)S ORDER IN ADOPTING THE FMV AT RS.30,000/- PER CENT AS ON 01/04/1981, THIS GROUND RAISED BY THE ASSESSEE IN THESE CROSS OBJECTIONS HAVE BECOME INFRUCTUOUS AND ARE ACCORDINGLY DISMISSED AS INFRUCTUOUS. 16. THE ASSESSEE HAS RAISED ONE MORE GROUND IN C.O. NO. 32/COCH/2017 WITH REGARD TO DISALLOWANCE OF EXPENSES OF RS.4,69,883/-. 17. THE FACTS OF THE CASE ARE THAT THE ASSESSEE HAD ALSO SPENT AN AMOUNT OF RS.4,69,883/- TOWARDS BROKERAGE AND OTHER EXPENSES, CREDIT FOR WHICH WAS NOT ALLOWED BY THE AO, WHILE CALCULATING CAPITAL GAINS. 18. ON APPEAL THE CIT(A) OBSERVED THAT THE ASSESSEE HAD NOT FURNISHED ANY EVIDENCE BEFORE THE AO IN RESPECT OF THE ABOVE EXPENSES. THE ASSESSEE CLAIMED THAT IT MAINTAINED BOOKS OF ACCOUNTS REGULARLY AND THEREFORE, SHOULD BE TREATED AS AN EVIDENCE, BUT ACCORDING TO THE CIT(A), BOOKS OF ACCOUNTS ARE WRITTEN AND I.T.A. NO.321 &322/C/2017 & C.O. NOS.31&32/COCH/2017 13 MAINTAINED ON THE BASIS OF MEMORANDUM RECORDS LIKE BILLS, VOUCHERS, RECEIPTS ETC. MERE BOOKS OF ACCOUNTS WITHOUT SUPPORTING MEMORANDUM RECORDS HAVE LITTLE OR NO EVIDENTIARY VALUE. THEREFORE, THE CIT(A) CONFIRMED THE REJECTION OF CLAIM OF OTHER EXPENSES INCLUDING BROKERAGE AMOUNTING TO RS.4,69,883/-. 19. AGAINST THIS, THE ASSESSEE HAS FILED THE PRESENT CROSS OBJECTION. 20. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RECORD. BEFORE THE CIT(A), THE ASSESSEE CLAIMED THAT IT WAS RECORDED IN THE BOOKS OF ACCOUNTS AND THE SAME IS TO BE ALLOWED WHICH WAS REJECTED. IN OUR OPINION, THE ASSESSEE IS DUTY BOUND TO PRODUCE THE REQUISITE DETAILS OF PAYMENT, TO WHOM IT WAS PAID, HOWEVER, IT WAS NOT FURNISHED. HENCE, IT IS APPROPRIATE TO MAKE A REASONABLE ESTIMATE IN THIS REGARD. IT IS NORMAL TRADE PRACTICE TO INCUR EXPENSES ON BUYING AND SELLING OF PROPERTIES ON ENGAGING BROKERS AND AGENTS. THE DEDUCTION IS TO BE GIVEN AT 2% OF THE TOTAL CONSIDERATION OF RS.2,19,95,800/- WHICH WORKS OUT TO RS.4,39,916/-. ACCORDINGLY, THIS GROUND OF THE ASSESSEE IS PARTLY ALLOWED. THUS, THE CROSS OBJECTION FILED BY THE ASSESSEE IN C.O. NO. 32/COCH/2017 IS PARTLY ALLOWED. 21. IN THE RESULT, THE APPEALS FILED BY THE REVENUE IN ITA NO.321 & 322/COCH/2017 ARE DISMISSED AND THE CROSS OBJECTION FILED BY THE ASSESSEE IN I.T.A. NO.321 &322/C/2017 & C.O. NOS.31&32/COCH/2017 14 C.O. NO. 31/COCH/2017 IS DISMISSED AND IN C.O. NO. 32/COCH/2017 IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 14 TH AUGUST, 2018. SD/- SD/- (GEORGE GEORGE K.) (CHANDRA POOJARI) JUDICIAL MEMBER ACCOUNTANT MEMBER PLACE: DATED: 14 TH AUGUST, 2018 GJ COPY TO: 1. SHRI NARAYAN KRISHNANAND, 40/109, 1 ST FLOOR, GOPAL RESIDENCY, THOTTEKKAT ROAD, ERNAKULAM, KOCHI-682 011. 2. SHRI KRISHNA IYER NARAYANAN, CC41/511 (64/895), GOVARDHAN BUNGALOW, CHITTOR ROAD, KOCHI-682 035. 3. THE ASSISTANT COMMISSIONER OF INCOME TAX, NON-CORPORATE, CIRCLE-1, KOCHI 4. THE COMMISSIONER OF INCOME-TAX(APPEALS), KOCHI 5. THE PR. COMMISSIONER OF INCOME-TAX, KOCHI 6. D.R., I.T.A.T., COCHIN BENCH, COCHIN. 7. GUARD FILE. BY ORDER (ASSISTANT REGISTRAR) I.T.A.T., COCHIN