Barid Baran Sarkar, Kolkata V. ACIT, Cir-37, Kolkata, Kolkata

CO 68/KOL/2012

• Counselvise Citation: [2013] 122 COUNSELVISE.COM (IT) 8542 (ITAT-KOLKATA)
• Duration Of Justice: 9 month(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 12-04-2013
• Appeal Filed By: Assessee
• Bench Allotted: C
• Assessment Year: 2006-2007
• Appeal Filed On: 12-07-2012
• Court: TRIBUNAL
• Department Lawyers: SNEHOTPAL DATTA
• Assessee Lawyers: CROSS OBJECTOR SHRI S M SURANA
• Keywords: Sale consideration of property below Jantri Value; Fair market value
• Section: 143(3); 50C; 2

Judgement Text

, C , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH: KOL KATA () BEFORE . . . . . . . . , !' /AND #! $'# , ) [BEFORE SHRI K. K. GUPTA, AM & SHRI MAHAVIR SINGH, JM] '% '% '% '% / I.T.A NO. 902/KOL/2012 $&' !() $&' !() $&' !() $&' !()/ // / ASSESSMENT YEAR: 200 6- 0 7 ASSISTANT COMMISSIONER OF INCOME-TAX, VS. SHRI BA RID BARAN SARKAR CIRCLE-37, KOLKATA. (PAN: AJEPS6465N) (+, /APPELLANT ) (-.+,/ RESPONDENT ) & C.O. NO.68/KOL/2012 IN '% '% '% '% / I.T.A NO. 902/KOL/2012 $&' !() $&' !() $&' !() $&' !()/ // / ASSESSMENT YEAR: 200 6- 0 7 SHRI BARID BARAN SARKAR VS. ASSISTANT COMMISSION ER OF INCOME-TAX, CIRCLE-37, KOLKATA. (CROSS OBJECTOR) (RESPONDENT) DATE OF HEARING: 12.04.2013 DATE OF PRONOUNCEMENT: 12 .04.2013 FOR THE REVENUE: SHRI SNEHOTPAL DATTA, SR. D R FOR THE ASSESSEE/CROSS OBJECTOR : SHRI S. M. SURANA, ADVOCATE / / ORDER PER MAHAVIR SINGH, JM: THIS APPEAL BY REVENUE AND CROSS OBJECTION BY ASSES SEE ARE ARISING OUT OF ORDER OF CIT(A) - XXIV, KOLKATA IN APPEAL NO. 859/CIT(A)-XXI V/C-37/10-11 DATED 14.03.2012. ASSESSMENT WAS FRAMED BY DCIT, CIRCLE-37, KOLKATA U /S. 251/154/143(3) OF THE INCOME-TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) FO R ASSESSMENT YEAR 2006-07 VIDE HIS ORDER DATED 25.05.2010. PENALTY IN DISPUTE WAS LEVIED BY ACIT, CIRCLE-37, KOLKATA U/S. 271(1)(C) OF THE ACT VIDE HIS ORDER DATED 22.02.2011. 2. THE ONLY ISSUE IN THIS APPEAL OF REVENUE IS AGA INST THE ORDER OF CIT(A) DELETING THE PENALTY LEVIDED U/S. 271(1)(C) OF THE ACT. FOR THI S, REVENUE HAS RAISED FOLLOWING GROUND NO.1: 1. THAT THE LD. CIT(A) ERRED IN KNOCKING OFF THE P ENALTY U/S. 271(1)(C) OF THE I. T. ACT, 1961 AS THE CONCEALMENT IS APPARENT IN THE FACTS OF THE CASE. 3. WE HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUGH FACTS AND CIRCUMSTANCES OF THE CASE. BRIEF FACTS LEADING TO THE ABOVE ISSUE ARE THAT THE AO FRAMED ASSESSMENT ORDER U/S. 143(3) OF 2 ITA NO.902/K/2012 & C.O. 68 OF 2012 SRI BARID BARAN SARKAR. 2006-07 THE ACT ON 31.12.2008. DURING THE COURSE OF ASSESS MENT PROCEEDINGS, THE AO NOTICED THAT THE ASSESSEE HAS SOLD A PORTION OF THE HOUSE PROPERTY L OCATED AT RAJA RAMMOHAN SARANI AND RECEIVED SALE CONSIDERATION OF RS.35 LAKH. ACCORDI NG TO AO, THE MARKET VALUE AS PER CIRCLE RATE WAS RS.53,32,80/-. THE AO REQUIRED THE ASSESSEE TO EXPLAIN AS TO WHY MARKET VALUE AS ASSESSED BY CIRCLE RATE SHOULD NOT BE ADOPTED FOR COMPUTING CAPITAL GAINS. THE AO FINALLY ASSESSED THE UNDERSTATED CONSIDERATION IN VIEW OF MARKET VALUE A SSESSED BY REGISTERING AUTHORITY BASED ON CIRCLE RATES AS SALE CONSIDERATION AS PER SECTION 5 0C(1) AND ADDED A SUM OF RS.18,32,800/- TO THE RETURNED INCOME OF THE ASSESSEE. AGGRIEVED, ASSESS EE PREFERRED APPEAL BEFORE CIT(A), WHO ALSO UPHELD THE ACTION OF AO AND DETERMINED THE VALU OF THE PROPERTY TO THE TUNE OF RS.44,15,500/-, THEREAFTER THE DIFFERENCE FRAMED RS.9,15,500/-. FI NALLY, AO STARTED PENALTY PROCEEDINGS U/S. 271(1)(C) OF THE ACT, AS ACCODING TO HIM, UNDERSTSA TED SALE CONSIDRAION IS CONCEALED INCOME OF THE ASSESSEE. THE AO LEVIED PENALTY ON THE INCOME SOUGHT TO BE EVADED AT RS.9,15,500/- AND ACCORDINGLY, HE LEVIED THE PENALTY AT 100% OF THE TAX EVADED AT RS.3,08,157/-. 4. AGGRIEVED, ASSESSEE PREFERRED APPEAL BEFORE CIT( A), WHO RELYING ON THE TRIBUNALS DECISION IN THE CASE OF RENU HINGORANI VS. ACIT IN ITA NO. 2210/MUM/2010, AY 2006-07 DATED 22.12.2010 DELETED THE PENALTY BY GIVING FOLL OWING FINDING IN PARA 3.3: 3.3. IN THE INSTANT CASE, THE FAIR MARKET VALUE OF THE PROPERTY WAS DETERMINED AT RS.53,32,800/- BY THE REGISTERING AUTHORITY. THE A POPELLANT HAD DISCLOSED THE SALE CONSIDERATION AT RS.35,00,000/-. THE DIFFERENCE OF RS.18,32,800/- WAS ADDED BY THE ASSESSING OFFICER U/S. 50C. THE LD. CIT(A) HAS CONF IRMED THE ABOVE ADDITION TO THE EXTENT OF RS.9,15,500/- ON THE BASIS OF THE VALUATI ON OF THE PROPERTY AT RS.44,15,500/- BY THE VALUATION OFFICE VIDE THE APPELLANT ORDER DATED 31.03.2010. IN THE PRESENT CASE, THE ASSESSING OFFICER HAS NOT DOUBTED THE SALE CONS IDERATION DISCLOSED BY THE APPELLANT AND THE GENUINENESS OF DOCUMENTS PRODUCED BEFORE HI M. THE DECISION OF THE HONBLE ITAT, MUMBAI IN THE CASE OF RENU HINGORANI IS SQUAR ELY APPLICABLE. RELYING ON THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE O F CIT VS. RELIANCE PETRO PRODUCITS PVT LTD. REPORTED IN 322 ITR 158, THE PENALTY OF RS .3,08,157/- IMPOSED BY 277(1)(C) IS CANCELLED. THESE GROUNDS OF APPAL ARE ALLOWED. 5. WE FIND THAT THE ONLY ISSUE BEFORE US AS TO WHET HER ON THE DEEMED UNDERSTATED TRANSACTION U/S. 50C OF THE ACT, THE UNDERSTATED AM OUNT WILL BE CONCEALED INCOME OF THE ASSESSEE OR NOT. WE FIND THAT THE BOMBAY TRBUNAL IN THE CASE OF V. R. GUPTA VS. ITO IN ITA NO.5950/MUM/2009, AY 2003-04 DATED NOVEMBER 10, 201 0 HAS CONSIDERED THE ISSUE AND DECIDED AS UNDER: WE HAE HEARD THE LEARNED AR AS WELL AS THE LEARNED DR AND CONSIDERED THE RELEVANT RECORD. IT IS NOT THE CASE OF THE AO THAT THE ASSES SEE HAS SUPPRESSED THE SALE CONSIDERATION SHOWN IN THE RETURN OF INCOME. THE AS SESSEE HAS ADMITTED THE SALE CONSIDERATION AS PER THE SALE DOCUMENTS, THE AO HAS APPLIED THE PROVISIONS OF SECTION 50C AND ADOPTED THE FULL VALUE OF CONSIDERATION .AS VALUED BY THE STAMP VALUING AUTHORITY. THUS, IT IS CLEAR THAT. THERE IS NO FIND ING BY THE AO THAT THE SALE CONSIDERATION ADINITTED BY THE ASSESSEE WAS NOT ACTUAL CONSIDERAT ION RECEIVED BY THE ASSESSEE. THE ADDITION WAS MADE BY APPLYING THE DEEMING PROVISION S OF THE ACT. AT THE OUTSET WE NOTE 3 ITA NO.902/K/2012 & C.O. 68 OF 2012 SRI BARID BARAN SARKAR. 2006-07 THAT BY APPLYING DEEMINGPROVISIONS OF SECTION 50C R ESULTING THE ADDITION IN THE CAPITAL GAIN DOES NOT AMOUNT TO CONCEALMENT OF PARTICULARS OF INCOME OR FURNISHING INACCURATE PARTICULARS OF INCOME. WHEN THE AO HAS NOT DOUBTED THE SALE CONSIDERATION ACTUALLY RECEIVED BY THE SSESSEE. EVEN OTHERWISE, THE VALUAT ION U/S. 50C(1) BEING THE VALUATION FOR HE PURPOSE OF STAMP DUTY IS NOT FINAL AND CONCL USIVE AND AGAIN SUBJECT TO THE VALUATION BY THE DVO, AS PER THE SUB-SECTION (2) OF THE SECTION 50C. THUS, THE VALUATION OF THE PROPERTY FOR THE PURPOSE OF CAPITAL GAIN IS HIGHLY SUBJECTIVE IN NATURE AND VARIES FRORN PERSON TO PERSON. IN THE ABSENCE OF ANY FINDI NG THAT THE ASSESSEE RECEIVED THE SALE CONSIDERATION MORE,THAN WHAT WAS ADMITTED IN THE RE TURN OF INCOME AS WELL AS IN THE SALE DOCUMENT, MERE ADDITION BY APPLYING THE DEEMING PRO VISIONS DOES NOT AMOUNT TO CONCEALMENT OF PARTICULARS OF INCOME OR FURNISHING INACCURATE PARTICULARS OF INCOME. ACCORDINGLY, IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE PENALTY IS NOT WARRANTED AND THE SAME IS DELETED. 6. RESPECTFULLY FOLLOWING THE ABOVE CASE LAWS, WE A RE OF THE VIEW THAT NO PENALTY U/S. 271(1)(C) OF THE ACT CAN BE LEVIED BY AO IN CASE TH E AO COULD NOT FIND OUT ANY THING OTHER THAN THE VALUATION DONE U/S. 50C OF THE ACT EITHER BY REGISTERING AUTHORITY OR VALUATION CELL OF THE DEPARTMENT. HENCE, WE CONFIRM THE ORDER OF CIT(A) AND THIS ISSUE OF REVENUES APPEAL IS DISMISSED. THE CROSS OBJECTION OF ASSESSEE IS S UPPORTIVE IN NATURE AND HENCE, DISMISSD AS INFRUCTUOUS. 8. IN THE RESULT, BOTH THE APPEAL AND CROSS OBJECTI ON ARE DISMISSED. 9. ORDER PRONOUNCED IN THE OPEN COURT ON 12 TH APRIL, 2013. SD/- SD/- . . . . . . . . , #! $'# #! $'# #! $'# #! $'# , (K. K. GUPTA) (MAHAVIR SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER ( 0 0 0 0) )) ) DATED : 12 TH APRIL, 2013 !12 $&34 $5! JD.(SR.P.S.) 4 ITA NO.902/K/2012 & C.O. 68 OF 2012 SRI BARID BARAN SARKAR. 2006-07 / 6 -$$7 87(9- COPY OF THE ORDER FORWARDED TO: 1 . +, / APPELLANT ACIT, CIRCLE-37, KOLKATA 2 -.+, / RESPONDENT SHRI BARID BARAN SARKAR, 125, RAJA RAM MOHAN SARANI, KOLKATA-700 009. 3 . $/& ( )/ THE CIT(A), KOLKATA 4. 5. $/& / CIT KOLKATA 7!>$ -$& / DR, KOLKATA BENCHES, KOLKATA .7 -$/ TRUE COPY, /&?/ BY ORDER, # '4 /ASSTT. REGISTRAR .