Shri Yogeshkumar D. Patel, Baroda V. The Income Tax Officer, Intl. Taxn., Vadodara

ITA 102/AHD/2016

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 6228 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-01-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 07-06-2017
• Assessment Year: 2011-2012
• Appeal Filed On: 13-01-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Sale consideration of property below Jantri Value; Capital asset; Retrospective amendment
• Section: 143(3); 50C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD C BENCH AHMEDABAD BEFORE SHRI PRAMOD KUMAR, ACCOUNTANT MEMBER, AND SHRI S. S. GODARA, JUDICIAL MEMBER. ITA NO. 102/AHD/2016 (ASSESSMENT YEAR: 2011-12) SHRI YOGESHKUMAR D. PATEL PITRUCHHAYA, SARDAR NAGAR, GIRDHARNAGAR CHOKADI, SAVLI, DIST. BARODA - 391770 APPELLANT VS. INCOME TAX OFFICER, INTL. TAXATION, VADODARA RESPONDENT PAN: ACZPP3883B /BY ASSESSEE : ARTI N. SHAH, A.R. /BY REVENUE : SHRI PRASOON KABRA, SR. D.R. /DATE OF HEARING : 01.01.2018 /DATE OF PRONOUNCEMENT : 17.01.2018 ORDER PER S. S. GODARA, JUDICIAL MEMBER THIS ASSESSEES APPEAL FOR ASSESSMENT YEAR 2011-12 ARISES AGAINST THE CIT(A)-13, AHMEDABADS ORDER DATED 19.11.2015 IN CA SE NO. CIT(A)- 13/AHD/35/2014-15, UPHOLDING ASSESSING OFFICERS MA KING LONG TERM CAPITAL GAINS ADDITION OF RS.2,93,50,955/- AFTER INVOKING SECTION 50C, IN PROCEEDINGS U/S. 143(3) OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT. ITA NO. 102/AHD/16 [SHRI YOGESHKUMAR D. PATEL VS. I TO] A.Y. 2011-12 - 2 - HEARD BOTH THE PARTIES. CASE FILE PERUSED. 2. WE START WITH BASIC FACTS PERTAINING TO THE ABOV ESTATED LONG TERM CAPITAL GAINS ISSUE. THERE IS NO DISPUTE THAT THE ASSESSEE AND HIS THREE FAMILY MEMBERS WERE CO-OWNERS IN POSSESSION OF THE CAPITAL ASSET I N QUESTION IN THE NATURE OF AGRICULTURAL LAND SITUATED IN R.S. NO. 586, 587, MO JE: GOTHDA, TALUKA SAVLI, DIST. VADODARA. THEY ENTERED INTO A BANAKHAT DATED 30.03 .2007 WITH M/S. BAJAJ HEALTHCARE LIMITED FOR SELLING THE SAME IN LIEU OF SALE CONSIDERATION AMOUNTING TO RS.32LACS IN ALL. THE SAID BANAKHAT IN PAGES 57 TO 61 OF THE PAPER BOOK REVEALS THAT THE ABOVE VENDEE HAD ALSO PAID ADVANCE MONEY OF RS. 3.08LACS THROUGH CHEQUE DATED 01.02.2007 AND 26.02.2007 AMOUNTING TO RS.1.0 8LACS AND RS.2LACS; RESPECTIVELY. THE ASSESSEE/VENDOR THEREAFTER EXECU TED THE RELEVANT SALE DEED IN THE RELEVANT PREVIOUS YEAR ON 21.04.2010 AFTER CONVERTI NG THE ABOVE LAND FROM AGRICULTURAL TO NON-AGRICULTURAL SINCE THE VENDEE I N QUESTION WAS NOT AN AGRICULTURIST. THE STAMP AUTHORITIES DETERMINED FA IR MARKET VALUE OF THE ABOVE CAPITAL ASSET TO BE RS.3,10,84,830/- FOR REGISTRATI ON PURPOSES. THE ASSESSING OFFICER REJECTED ASSESSEES CONTENTION INTER ALIA P LEADING TO HAVE TRANSFERRED POSSESSION AS WELL AS ASSET ITSELF TO THE VENDEE CO NCERNED WELL BEFORE GETTING THE SALE DEED REGISTERED. THE ASSESSING OFFICER WENT I NTO A DETAILED DISCUSSION IN ASSESSMENT ORDER DATED 21.03.2014 TO CONCLUDE THAT THE ASSESSEE/VENDOR HAD SOLD THE LAND AS NON-AGRICULTURAL ONLY ATTRACTING LONG T ERM CAPITAL GAINS TAX AS PER PROVISIONS OF THE ACT. ALL THESE RESULTED IN THE I MPUGNED ADDITION OF RS.2,93,50,955/- AS PER SECTION 50C OF THE ACT. TH E CIT(A) CONFIRMS ASSESSING OFFICERS ACTION. 3. LEARNED COUNSEL REPRESENTING ASSESSEE RAISES TWO SUBSTANTIVE ARGUMENTS. HER FIRST PLEA IS THAT BOTH THE LOWER AUTHORITIES H AVE ERRED IN LAW AS WELL AS ON FACTS IN REJECTING ASSESSEES VEHEMENT CONTENTION THAT TH E CAPITAL ASSET IN QUESTION WAS TRANSFERRED WELL BEFORE HE HAD EXECUTED THE RELEVAN T SALE DEED IN THE IMPUGNED ASSESSMENT YEAR. HER SECOND PLEA IS THAT BOTH THE LOWER AUTHORITIES HAVE NOT APPRECIATED THE FACT THAT THE ASSESSEE OWNED ONLY 1 /4 TH SHARE OF THE RELEVANT CAPITAL ITA NO. 102/AHD/16 [SHRI YOGESHKUMAR D. PATEL VS. I TO] A.Y. 2011-12 - 3 - ASSET WHEREAS ASSESSING OFFICER AND THE CIT(A) HAVE ASSESSED THE ENTIRE CAPITAL GAINS IN HIS HANDS. THE REVENUE STRONGLY SUPPORTS BOTH THE LOWER AUTHORITIES ACTIONS MAKING THE IMPUGNED LONG TERM CAPITAL GAINS ADDITION. WE PROCEED IN THIS BACKDROP OF FACTS TO FIRST OF ALL NOTICE FROM THE B ANAKHAT DATED 30.03.2007 IN QUESTION THAT THE VENDOR SIDE HEREIN HAD RECEIVED P ART PAYMENT (SUPRA) THROUGH BANKING CHANNEL. THERE CAN HARDLY BE ANY DISPUTE T HAT SECTION 50C(1) FIRST AND SECOND PROVISO INSERTED BY THE FINANCE ACT (2016) W .E.F. 01.04.2007 ENVISAGE THAT IN CASE THE DATE OF THE AGREEMENT FIXING THE AMOUNT OF CONSIDERATION AND THE DATE OF REGISTRATION FOR THE TRANSFER OF THE CAPITAL ASSET ARE NOT THE SAME, THE VALUE ADOPTED OR ASSESSED OR ASSESSABLE BY THE STAMP VALUATION AU THORITY ON THE DATE OF AGREEMENT MAY BE TAKEN FOR THE PURPOSE OF COMPUTING FULL VALUE OF CONSIDERATION FOR SUCH TRANSFER. THE LEGISLATURE THEREAFTER STIP ULATES IN SECOND PROVISO THAT THE ABOVE FIRST PROVISO WOULD APPLY ONLY IN CASE WHERE THE AMOUNT OF CONSIDERATION OR PART THEREOF HAS BEEN RECEIVED BY WAY OF AN ACCOUNT PAYEE CHEQUE OR ACCOUNT PAYEE BANK DRAFT OR BY USE OF ELECTRONIC CLEARING SYSTEM THROUGH BANK ACCOUNTS ON OR BEFORE DATED OF AGREEMENT FOR TRANSFER. WE REITERA TE THAT THE ASSESSEE HAD RECEIVED PART OF THE SALE CONSIDERATION ON 26.02.2007 WELL B EFORE ENTERING INTO THE RELEVANT BANAKHAT DATED 30.03.2007. WE FURTHER FIND THAT TH IS TRIBUNALS CO-ORDINATE BENCHS DECISION IN DHARAMSHIBHAI SONANI VS. ACIT (2016) 75 TAXMANN.COM 141 (AHMEDABAD-TRIB) HOLDS BOTH THE ABOVE PROVISO TO BE CURATIVE ONES HAVING RETROSPECTIVE EFFECT W.E.F. 01.04.2003. WE THEREFO RE ACCEPT ASSESSEES FORMER PLEA FOR STATISTICAL PURPOSES AND DIRECT THE ASSESSING O FFICER TO DECIDE THE ISSUE AFRESH AFTER ASCERTAINING THE VALUE OF ABOVE CAPITAL ASSET AS ON THE DATE OF AGREEMENT AS PER LAW AFTER AFFORDING ADEQUATE OPPORTUNITY OF HEARING . IT IS MADE CLEAR THAT THE ASSESSEE WOULD BE HAVING ALL OPTIONS OPEN TO CONTES T THE RELEVANT ASSESSABLE VALUE BY SEEKING NECESSARY REFERENCE U/S.50C(2) OF THE AC T TO THE DVO. 4. WE NOW ADVERT TO ASSESSEES LATTER PLEA THAT HE SOLD ONLY 1/4 TH SHARE WHEREAS BOTH THE LOWER AUTHORITIES HAVE ASSESSED ENTIRE CON SEQUENTIAL CAPITAL GAINS IN HIS HANDS. WE FIND THAT THE NEITHER THE ASSESSING OFFI CER NOR THE CIT(A) HAVE ITA NO. 102/AHD/16 [SHRI YOGESHKUMAR D. PATEL VS. I TO] A.Y. 2011-12 - 4 - EXAMINED THIS LATTER PLEA. WE THEREFORE RESTORE TH E INSTANT LATTER ISSUE BACK TO THE ASSESSING OFFICER TO BE DECIDED AS PER LAW. 5. THIS ASSESSEEES APPEAL IS ACCEPTED FOR STATISTI CAL PURPOSES. [PRONOUNCED IN THE OPEN COURT ON THIS THE 17 TH DAY OF JANUARY, 2018.] SD/- SD/- (PRAMOD KUMAR) (S. S. GODARA) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD: DATED 17/01/2018 TRUE COPY S.K.SINHA / COPY OF ORDER FORWARDED TO:- / REVENUE 2 / ASSESSEE ! / CONCERNED CIT 4 !- / CIT (A) ( )*+ ,--. . /0 / DR, ITAT, AHMEDABAD 1 +23 / GUARD FILE. BY ORDER / . // . /0