Shri Ashok Natvarlal Patel, Ahmedabad V. The ITO, Ward-2(2)(1), Ahmedabad

ITA 1005/AHD/2019

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 1528 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 3 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-10-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 11-09-2022
• Assessment Year: 2013-2014
• Appeal Filed On: 11-06-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Sale consideration of property below Jantri Value; Depreciation
• Section: 50C; 143(2)

Judgement Text

ITA No.1005/Ahd/2019 A.Y. 2013-14 Page 1 of 3 IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD “SMC” BENCH, AHMEDABAD BEFORE Ms. SUCHITRA KAMBLE, JUDICIAL MEMBER ITA No.1005/Ahd/2019 Assessment Year: 2013-14 Shri Ashok Natvarlal Patel, vs. Income Tax Officer, 33, Rangsujalam Society, Ward – 2(2)(1), Ahmedabad Naranpura, Ahmedabad – 380 013. [PAN – ABBPP 5392 E] (Appellant) (Respondent) Assessee by : None Respondent by : Shri Rakesh Jha, Sr. DR Date of hearing : 12.09.2022 Date of pronouncement : 07.10.2022 O R D E R This appeal is filed by the Assessee against the order dated 15.03.2019 passed by the CIT(A)-10, Ahmedabad for the Assessment Year 2013-14. 2. The assessee has raised the following grounds of appeal :- “1. The appellant is an individual and filed return of income for A.Y. 2013-14 on 08.09.2014 for total income of Rs.6,12,900/- comprising from business, income from capital gain and income from other sources. 2. The appellant, from time to time, furnished the details to A.O. as required by notice u/s. 143(2) of the I.T. Act. 3. The AO issued show cause notice dated 19.02.2016 to the appellant asking as to why capital gain arose on the sale of residential building and sale of factory building as per Section 50C of the I.T. Act shall not be charged in your case. 4. The appellant vide reply dated 26.02.2016 explained the issue in details but AO without properly considering the same, added capital gain of Rs.14,65,000/- towards sale of residential building and Rs.2,51,667/- towards sale of factory buildings. ITA No.1005/Ahd/2019 A.Y. 2013-14 Page 2 of 3 5. Before the appellate authority, the fact and circumstances of the case for non-disclosing the capital gain on sale of property and investment in purchasing new residential flat was explained and addition of Rs.14,65,000/- was deleted. 6. Before the appellate authority the appellant also explained the situation as to why the valuation report from the Registered Valuer not obtained and derived the WDV by adopting depreciation at the rate of 10% as per the law. The Ld. CIT(A) has confirmed the addition without properly considering the fact of the case explained to him. 7. The appellant is, therefore, before Hon’ble ITAT for kind and judicious consideration.” 3. The assessee filed return of income on 08.09.2014 thereby declaring total; income of Rs.6,12,900/-. The case was selected for limited scrutiny assessment. The Assessing Officer made addition of Rs.2,51,667/- in respect of Short Term Capital Gain (STCG). 4. Being aggrieved by the assessment order, the assessee filed appeal before the CIT(A). The CIT(A) parlay allowed the appeal of the assessee. 5. At the time of hearing none appeared on behalf of the assessee. Notice was duly served to the assessee but the same was returned back with the remark that the “assessee left the premises”. No new address was provided to the Registry. Hence, I am proceeding on the basis of the submissions of the assessee reproduced in the order of CIT(A). 6. The Ld. DR submitted that the CIT(A) has rightly confirmed the addition of Rs.2,51,667/- towards capital gain arose out of sale of residential building under Section 50C of the Income Tax Act, 1961 as per jantry rate prevailing on the date of transfer. The Ld DR submitted that the assessee never raised objection to the valuation rate before the Assessing Officer and, therefore, cannot plea that difference between the valuation adopted by Stamp Valuation Authority and sale consideration is very nominal. ITA No.1005/Ahd/2019 A.Y. 2013-14 Page 3 of 3 7. I have heard the Ld. DR and perused all the relevant material available on record. As relates to Section 50C of the Act, the assessee is required to file objection to the valuation rate applied by Stamp Valuation Authority which was not done in the present case as observed by the CIT(A) but before the Assessing Officer the assessee has categorically replied that the assessee has sold residential building in which he has half share and purchased the residential property in the year jointly which is having half share and, therefore, rightly claimed exemption under Section 54B of the Act in the return of income. The assessee has given all the details which is mentioned in paragraph no.4.3 as well as the application of jantry rate after reducing the depreciation. These facts were totally ignored by the Assessing Officer as well as CIT(A). Merely not objecting cannot be the criteria as per Section 50C of the Act. Therefore, appeal of the assessee is allowed. 8. In the result, appeal of the assessee is allowed. Order pronounced in the open Court on this 7 th day of October, 2022. Sd/- (SUCHITRA KAMBLE) Judicial Member Ahmedabad, the 7 th day of October, 2022 PBN/* Copies to: (1) The appellant (2) The respondent (3) CIT (4) CIT(A) (5) Departmental Representative (6) Guard File By order UE COPY Assistant Registrar Income Tax Appellate Tribunal Ahmedabad benches, Ahmedabad