K.Narayana Das, CHENNAI V. DCIT Non Corporate Circle 10(1), CHENNAI

ITA 1015/CHNY/2018

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 6572 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 6 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-10-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Assessment Year: 2012-2013
• Appeal Filed On: 26-03-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: S SRIDHAR MR J PAVITRAN KUMA
• Keywords: Cost of acquisition; Fair market value; Capital Gains
• Section: 54F; 201

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH : CHENNAI , , BEFORE SHRI GEORGE MATHAN, JUDICIAL MEMBER & S HRI RAMIT KOCHAR , ACCOUNTANT MEMBER IN ITA NO. 1015/CHNY/2018 / ASSESSMENT YEAR : 2012-13 LATE SHRI K. NARAYANA DAS REP BY L/H K. POORNIMA, 42, GANADEESWARAR KOIL STREET, PURASAIWALKAM, CHENNAI 600 084. PAN: AABPN 9410 C V. THE DCIT, NON-CORPORATE CIRCLE 10(1), CHENNAI. ( /PETITIONER) ( /RESPONDENT) / APPELLANT BY : MR.S.SRIDHAR,ADVOCATE /RESPONDENT BY : MR.J.PAVITRAN KUMAR,JCIT,D.R % / DATE OF HEARING : 21 - 10 - 201 9 % / DATE OF PRONOUNCEMENT : 21 - 10 - 201 9 / O R D E R PER GEORGE MATHAN, JUDICIAL MEMBER THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS)-12, CHENNA I IN I.T.A NO.78/C.I.T(A)-12/2015-16 DATED 20.02.2018 FOR THE ASSESSMENT YEAR 2012-13. ITA NO.1015/CHNY/2018 :- 2 -: 2. MR.S.SRIDHAR REPRESENTED ON BEHALF OF THE ASSESSEE, AND MR.J.PAVITRAN KUMAR REPRESENTED ON BEHALF OF THE REVENUE. 3. IT WAS SUBMITTED BY THE LD.AR THAT THE ISSUES R AISED IN THIS APPEAL WERE IN RESPECT OF COMPUTATION OF LONG TERM CAPITAL GAINS IN RESPECT OF SALE OF PROPERTY KNOWN AS DASAPRAKASH POONAMALLEE HIGH ROAD, CHENNAI 600 006 ALONG WITH STAFF QUARTERS. I T WAS SUBMITTED THAT THE SAID PROPERTY WAS SOLD DURING THE FINANCIA L YEAR 2011-12 RELEVANT TO ASSESSMENT YEAR 2012-13 FOR A TOTAL CON SIDERATION OF RS.165/- CRORES BY A GROUP OF FAMILY MEMBERS CONSIS TING OF 14 PERSONS. IT WAS FURTHER SUBMITTED THAT THE ASSESSEE HAD A SHARE OF 30% IN THE PROPERTY, AND CONSEQUENTLY, RECEIVED 30% OF THE SALE CONSIDERATION. IT WAS FURTHER SUBMITTED THAT AS AGA INST THE SAID CONSIDERATION RECEIVED, THE ASSESSEE HAD CLAIMED 30 % OF TOTAL EXPENDITURE OF RS.10,81,70,554/-, AS ALSO CERTAIN OTHER EXPENSES. IT WAS SUBMITTED THAT THE ASSESSING OFFICER AND THE LD.CIT(A) HAD NOT ALLOWED THE SAID EXPENDITURE IN ITS ENTIRETY. IT WA S FURTHER SUBMITTED THAT THE ASSESSEE HAD ALSO CLAIMED EXEMPTION U/S.54 F OF THE ACT. HOWEVER, THE ASSESSING OFFICER DID NOT ALLOW THE AS SESSEES CLAIM OF DEDUCTION U/S.54F OF THE ACT ON GROUND THAT THE ASS ESSEE HAD NOT SUBMITTED THE DETAILS TO PROVE THAT THE CONSTRUCTIO N WAS COMPLETED. IT WAS SUBMITTED THAT THE ASSESSEE HAD ALSO PAID LE GAL FEES TO FIGHT THE ITA NO.1015/CHNY/2018 :- 3 -: CASE IN COURT PERTAINING TO TRANSFER OF THE PROPERT Y, WHICH HAD ALSO NOT BEEN ALLOWED. THE LD.AR PLACED BEFORE US A COPY OF THE ORDER OF CO-ORDINATE BENCH OF THIS TRIBUNAL IN THE CASE OF T WO OF THE OTHER CO-OWNERS BEING SHRI SHASHABINDU DAS AND SHRI BHAGA WAN DAS DHANANJAYA DAS IN ITA NO.1282 & 1284/CHNY/2018 WHER EIN THE TRIBUNAL AT PARA NOS.4 TO 5 HELD AS FOLLOWS:- 4. WE HEARD THE RIVAL SUBMISSIONS. IT IS CLEAR FR OM THE ORDERS OF THE LOWER AUTHORITIES THAT THEY HAVE NOT EXAMINE D AS TO WHETHER THE IMPUGNED EXPENDITURE CLAIMED BY THE ASSESSEES, AROSE OUT OF A OVER-RIDING TITLE THERE UNDER. IF THE ASSESSEES FULL OWNERSHIP OF A UNQUALIFIED RIGHT TO ENJOY THE PROPERTY GETS REST RICTED IN THE PARENTAL DEED, THEN IT WOULD CREATE A OVER-RIDING TITLE ON THE BENEFICIARIES. THESE ASPECTS REQUIRE DETAILED EXAM INATION AND HENCE WE DEEM IT FIT TO REMIT THIS ISSUE BACK TO TH E AO FOR A FRESH EXAMINATION. THE ASSESSEE SHALL LAY RELEVANT MATE RIALS IN SUPPORT OF ITS CONTENTION BEFORE THE AO AND COMPLY WITH TH E REQUIREMENTS OF THE AO IN ACCORDANCE WITH LAW. THE AO SHALL FURN ISH ADEQUATE OPPORTUNITY TO THE ASSESSSEE AND DECIDE THE MATTER IN ACCORDANCE WITH AW. 5. WITH REGARD TO THE COST OF ACQUISITION AS ON 01. 04.1981, VARIOUS FACTORS HAVE TO BE EVALUATED FOR DETERMININ G THE FAIR MARKET VALUE AS ON A PARTICULAR DATE VIZ., LOCATION OF LAN D, ITS POTENTIALITY, SURROUNDINGS, RATE OF THE ADJACENT LAND DETERMINED BY THE COURTS, IF ANY, THE CONDITION OF THE LANDS, THE EXPENDITURE RE QUIRED TO DEVELOP THE LAND, THE LIMITATIONS, IF ANY VIZ., LEGAL DISPU TES AS HAS HAPPENED IN THIS CASE, EVICTION OF UNAUTHORIZED PERSONS ETC. IN THE VERY NATURE OF THINGS, THE PRICES ARE BOUND TO VARY ACCO RDING TO THE CONTEMPORANEOUS ECONOMIC ENVIRONMENT, FROM LAND TO LAND, ITA NO.1015/CHNY/2018 :- 4 -: DEPENDS UPON BUYER TO BUYER AND SELLER TO SELLER WH ICH INCLUDES EVEN THE REASONS FOR WHICH THE SELLERS ARE SELLING THE LANDS, THE GUIDELINE VALUE ETC. THUS, THE AO CANNOT DETERMINE THE FAIR MARKET VALUE AS ON 01.04.1981 SOLELY BASED ON THE GUIDELIN E VALUE. IN THE FACTS AND CIRCUMSTANCES, WE DEEM IT FIT TO REMIT TH IS ISSUE BACK TO THE AO FOR A FRESH EXAMINATION. THE ASSESSEE SHALL LAY RELEVANT MATERIALS IN SUPPORT OF ITS CONTENTION BEFORE THE A O AND COMPLY WITH THE REQUIREMENTS OF THE AO IN ACCORDANCE WITH LAW. THE AO IS FREE TO CONDUCT APPROPRIATE ENQUIRY AS DEEMED FIT, BUT HE SHALL FURNISH ADEQUATE OPPORTUNITY TO THE ASSESSSEE ON TH E MATERIAL ETC TO BE USED AGAINST IT AND DECIDE THE MATTER IN ACC ORDANCE WITH LAW. LD.AR SUBMITTED THAT THE TRIBUNAL RESTORED THE ISSU ES TO THE FILE OF ASSESSING OFFICER FOR RE-ADJUDICATION IN RESPECT OF CERTAIN EXPENDITURE RELATING TO TRANSFER OF PROPERTY CLAIMED BY THOSE A SSESSEES, AS ALSO IN REGARD TO COST OF ACQUISITION AS ON 01.04.1981. IT WAS SUBMITTED THAT THE ISSUES OF THE EXPENDITURES RELATING TO SALE THE PROPERTY, AS ALSO THE ISSUE OF DETERMINATION OF THE FAIR MARKET VALUE AS ON 01.04.1981 HAVING BEEN RESTORED TO THE FILE OF ASSESSING OFFIC ER FOR RE-ADJUDICATION IN THE CASE OF OTHER TWO CO-OWNERS, IT WOULD BE APPROPRIATE THAT IN THE ASSESSEES CASE ALSO, IT MA Y BE REMITTED BACK TO THE FILE OF ASSESSING OFFICER FOR RE-ADJUDICATION. IT WAS A PRAYER THAT THE ASSESSEE HAD NOT BEEN AFFORDED ADEQUATE OPPORTU NITY TO PRODUCE ALL THE EVIDENCES TO PROVE THE COMPLETION OF THE CO NSTRUCTION OF THE RESIDENTIAL HOUSE FOR THE PURPOSE OF DEDUCTION U/S. 54F OF THE ACT IN THE ITA NO.1015/CHNY/2018 :- 5 -: COURSE OF ORIGINAL ASSESSMENT PROCEEDINGS. IT WAS A PRAYER THAT IN THE INTEREST OF JUSTICE, THIS ISSUE COULD ALSO BE RESTO RED TO THE FILE OF ASSESSING OFFICER FOR RE-ADJUDICATION AND THE ASSES SEE WOULD BE ABLE TO PRODUCE ALL THE EVIDENCES REQUIRED. 4. ON THE OTHER HAND, LD.DR VEHEMENTLY SUPPORTED T HE ORDERS OF THE ASSESSING OFFICER AND THE LD.CIT(A). 5. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. AS IT IS NOTICED THA T THE ISSUE OF THE ALLOWABILITY OF THE EXPENSES IN THE CASE OF TWO OF THE OTHER CO-OWNERS REFERRED TO SUPRA HAS BEEN RESTORED TO FI LE OF ASSESSING OFFICER, ALONG WITH THE ISSUE OF DETERMINATION OF T HE FAIR MARKET VALUE OF THE PROPERTY SOLD AS ON 01.04.1981, IN THE INTER EST OF JUSTICE, THE IDENTICAL ISSUES RAISED IN THE ASSESSEES APPEAL AR E RESTORED TO FILE OF ASSESSING OFFICER FOR RE-ADJUDICATION, IN LINE WITH THE DECISION OF CO-ORDINATE BENCH OF THE TRIBUNAL IN THE CASE OF T WO OF THE OTHER CO-OWNERS BEING SHRI SHASHABINDU DAS AND SHRI BHAGA WAN DAS DHANANJAYA DAS DATED 29.11.2018 FOR ASSESSMENT YEAR 2012-13 REFERRED TO SURPA. AS ALSO IT IS ALSO NOTICED THAT THE ASSESSEE HAS NOW PRODUCED THE EVIDENCE IN THE FORM OF THE TAX PAID C HALLAN FOR CORPORATION TAX DATED 03.03.2017 IN THE NAME OF ASS ESSEE TO PROVE THE CLAIM OF CONSTRUCTION OF THE RESIDENTIAL HOUSE, THIS ISSUE IS ALSO ITA NO.1015/CHNY/2018 :- 6 -: RESTORED TO THE FILE OF ASSESSING OFFICER FOR RE-AD JUDICATION IN RESPECT OF THE CLAIM OF DEDUCTION U/S.54F OF THE ACT. 6. IN THE RESULT, THE APPEAL OF ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT AFTER CONCLUSIO N OF HEARING ON 21 ST OCTOBER, 2019, AT CHENNAI. SD/- SD/- ( ) ( ) (RAMIT KOCHAR) $ /ACCOUNTANT MEMBER (GEORGE MATHAN) % $ / JUDICIAL MEMBER / CHENNAI ) / DATED: 21.10.2019. K S SUNDARAM ,- .- / COPY TO: 1 . / APPELLANT 4. / / CIT 2. / RESPONDENT 5. - 2 / DR 3. / () / CIT(A) 6. / GF