INCOME TAX OFFICER, BARAN V. SHRI CHAIN SINGH SINGHVI, BARAN

ITA 106/JPR/2018

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 3635 (ITAT-JAIPUR)
• Duration Of Justice: 1 year(s) 2 month(s) 29 day(s)
• Appeal Type: Income Tax (International Taxation) Appeal
• Pronouncement Date: 29-04-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2011-2012
• Appeal Filed On: 30-01-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SEEMA MEENA
• Assessee Lawyers: NIKHILESH KATARIA CA DHK
• Keywords: Sale consideration of property below Jantri Value; Additional evidence
• Section: 50C; 2(14)

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR JH FOT; IKY JKWO] U;KF;D LNL; ,O A JH HKKXPUN ] YS[KK LNL; DS LE{K BEFORE: SHRI VIJAY PAL RAO, JM & SHRI BHAGCHAND, A M VK;DJ VIHY LA- @ ITA NO. 106/JP/2018 FU/KZKJ.K O'K Z @ ASSESSMENT YEARS : 2011-12. THE INCOME TAX OFFICER, BARAN MINI SACHIWALYA CAMPUS, KOTA ROAD, BARAN. CUKE VS. SH. CHAIN SINGH SINGHVI, WARD NO. 5, NEAR EKTA LODGE, CHHABRA, DISTT. BARAN. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO. ARLPS 6168 B VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT JKTLO DH VKSJ LS@ REVENUE BY : SMT. SEEMA MEENA (JCIT) FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI NIKHILESH KATARIA (CA) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 10.05.2018. ?KKS'K .KK DH RKJH[K @ DATE OF PRONOUNCEMENT : 14/05/2018. VKNS'K@ ORDER PER VIJAY PAL RAO, J.M. THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER DATED 29 TH NOVEMBER, 2017 OF LD. CIT (A), KOTA FOR THE ASSESSM ENT YEAR 2011-12. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT (A), KOTA HAS ERRED IN :- (I) DELETING THE ADDITION OF RS. 77,94,725/- IGNORING A ND WITHOUT APPRECIATING THE FACT THAT THE AO MADE THE ADDITION U/S 50C ON THE BASIS OF VALUE OF PROPERTY DETERMINED BY THE DI G (STAMPS); (II) THE APPELLANT CRAVES LIBERTY TO RAISE ADDITIONAL GR OUND AND TO MODIFY/AMEND THE GROUND OF APPEAL AT THE TIME OF HE ARING. 2 ITA NO. 106/JP/2018 SHRI CHAIN SINGH SINGHVI, BARAN. 2. THE ASSESSEE FILED HIS RETURN OF INCOME DECLARIN G TOTAL INCOME OF RS. 3,69,230/- ON 20 TH MARCH, 2013. SUBSEQUENTLY, THE AO NOTED THAT THE ASSESSEE DECLARED CAPITAL GAIN OF RS. 1,44,400/- FROM SALE O F LAND FOR A CONSIDERATION OF RS. 12,00,000/-. THE AO RECEIVED AN INFORMATION FROM S TAMP VALUATION AUTHORITY WHEREBY THE DLC VALUE OF THE LAND WAS TAKEN AT RS. 89,94,725/- INSTEAD OF RS. 12,00,000/-. ACCORDINGLY, THE AO REOPENED THE ASSE SSMENT TO ASSESS THE CAPITAL GAIN BASED ON THE REVISED VALUATION OF THE LAND BY THE STAMP VALUATION AUTHORITY. IN THE REASSESSMENT, THE AO TOOK THE FULL VALUE CONSID ERATION AT RS. 89,94,725/- IN TERMS OF SECTION 50C OF THE IT ACT AND CONSEQUENTLY COMPUTED THE CAPITAL GAIN OF RS. 79,39,125/- AS AGAINST THE CAPITAL GAIN DECLARE D BY THE ASSESSEE OF RS. 1,44,400/-. THE ASSESSEE CHALLENGED THE ACTION OF THE AO BEFORE THE LD. CIT (A). THE LD. CIT (A) AFTER CONSIDERING THE ORDER OF THE TAX BOARD PURSUANT TO WHICH THE VALUE OF THE LAND WAS FINALIZED AT RS. 12,00,000/- AND DELETED THE ADDITION MADE BY THE AO. 3. WE HAVE HEARD THE LD. D/R AS WELL AS THE LD. A/ R AND CONSIDERED THE RELEVANT MATERIAL ON RECORD. THE LD. D/R HAS SUBMITTED THAT THE AO HAS COMPUTED THE CAPITAL GAIN AS PER THE PROVISIONS OF SECTION 50C OF THE AC T AS THE ORDER OF THE TAX BOARD WAS NOT AVAILABLE BEFORE THE AO AT THE TIME OF PA SSING THE ASSESSMENT ORDER. ON THE OTHER HAND, THE LD. A/R HAS SUBMITTED THAT T HE ORDER OF THE TAX BOARD IS NOT AN ADDITIONAL EVIDENCE BUT IT IS AN ORDER PASSED BY THE AUTHORITY WHEREBY THE EARLIER ORDER OF ENHANCING THE VALUE OF THE LAND BY STAMP V ALUATION AUTHORITY WAS REVERSED AND THE ORIGINAL VALUE OF THE LAND AT RS. 12,00,000 /- WAS RESTORED. 3 ITA NO. 106/JP/2018 SHRI CHAIN SINGH SINGHVI, BARAN. 3.1. HAVING CONSIDERED THE RIVAL SUBMISSIONS AS WEL L AS RELEVANT MATERIAL ON RECORD, WE FIND THAT THE RAJASTHAN TAX BOARD, AJMER VIDE ORDER DATED 21 ST APRIL, 2017 REMANDED THE MATTER OF VALUATION OF LAND FOR T HE PURPOSE OF STAMP DUTY TO THE COLLECTOR STAMPS KOTA. PURSUANT TO THE SAID ORDER, THE COLLECTOR STAMPS, KOTA VIDE ORDER DATED 3 RD OCTOBER, 2017 HAS DETERMINED THE VALUE OF THE LAND AT RS. 12,00,000/- FOR STAMP DUTY PURPOSE. ACCORDINGLY, T HE ENHANCEMENT IN THE VALUE BY THE STAMP VALUATION AUTHORITY WAS AGAIN REVISED TO THE ORIGINAL VALUE OF RS. 12,00,000/-. THE LD. CIT (A) HAS DECIDED THE ISSUE BY CONSIDERING ALL THESE FACTS AS UNDER :- I HAVE GONE THROUGH ASSESSEE'S SUBMISSION AND AO'S FINDINGS. THE ENTIRE MATTER IN THE GROUNDS OF APPEALS RAISED PERTAINS TO THE ENHANCEMENT IN THE VALUATION OF THE DLC RATE AND RESULTANT FIGURE OF C ONSIDERATION WORKED OUT BY THE SUPERVISORY AUTHORITY TO THE SUB REGISTRAR, CHHABRA, THE DIG (S TAMPS), KOTA. THE APPELLANT'S PLEA WAS THAT THE VALUE WAS REVISED AFTER SUBSTANTIAL PEROD OF TIME AND THAT UNDER THE IMPRESSION THAT THIS WAS TAXABLE GAI NS HE HAD FILED CAPITAL GAINS RELATED RETURN THOUGH HE LATER REALIZED THAT THE LAND BEING AGRICULTURAL WAS COVERED BY THE NOTIFICATION NO 9447 DATED 6.01.1994 AND THE BARAN MUNICIPALITY HAD NOT BEEN NOTIFIED THEN SO HIS LAND COULD NOT BE CATEGORIZED AS URBAN, HENCE NOT ELIGIBLE FOR CLAIM U/S.2(14). ON THE OTHER HAND, THE ONLY BASIS OF THE ENHANCEMEN T DONE BY THE A.O U/S 50C WAS THE VALUE INCREASED BY THE DIG (STAMPS), KOTA, TREATING THE LAND AS COMMERCIALLY ASSESSABLE. THE APPELLANT WHO WAS IN APPEAL TO THE RAJASTHAN KA R BOARD AGAINST THE REFRRED ORDER OF THE DIG (STAMPS), KOTA HAS GOT RELIEF FROM THE BOAR D WHICH DIRECTED THE COLLECTOR (STAMPS) , KOTA TO REASSESS THE SALE VALUE OF THE SAID PROPE RTY AT THREE TIMES OF AGRICULTURAL LAND VIDE THE ORDER DATED 21/04/2017. THE TAX BOARD HAS ALSO HELD THAT THE LAND, THOUGH AGRICULTURAL, BUT IS WITHIN THE BARAN MUNICIPAL LIM ITS BUT HAS NOT . ACQUIRED ANY COMMERCIAL CHARACTER. HOWEVER, ITS AGRICULTURAL OPE RATIONS ALSO NOT BEING PROVED, THE ASSESSABILITY WAS FIXED AT THREE TIMES OF THE AGRIC ULTURAL LAND RATES. FOLLOWING THE ABOVE ORDER OF THE TAX BOARD, THE COL LECTOR (STAMPS) COURT VIDE THEIR ORDER DATED 03.10.2017 HAS MADE RE-VALUATION OF THE SAID AGRICU LTURE LAND IN RESPONSE TO ORDER DATED 4 ITA NO. 106/JP/2018 SHRI CHAIN SINGH SINGHVI, BARAN. 21.04.2017 OF THE RAJASTHAN TAX BOARD, AND VALUATIO N OF THE SAID AGRICULTURE LAND HAS BEEN FINALIZED AT RS. 12,00,000/-, WHICH VALUE THE APPEL LANT HAS ALREADY DECLARED FOR CAPITAL GAINS PURPOSES IN HIS RETURN. THUS THE VERY 'BASIS ON WHICH THE A.O HAD BASED, HI S OWN VALUATION U/S 50C AND CREATED ADDITIONAL DEMAND HAS NOW BEEN LIQUIDATED BY THE OR DERS REFERRED ABOVE. IN VIEW OF THE SAME AND THE ABOVE DISCUSSION 1 HOLD THAT- THE LAND IN QUESTION WAS NOT PROVED TO BE USED FOR AGRICULTURAL OPERATIONS AND WAS RIGHTLY BROUGHT WITHIN THE PURVIEW OF CAPITAL GAINS TAX AS ALSO SHOWN IN THE RETURN FILED. THE SAME WAS NOT ELIGIBLE FOR EXEMPTION U/S 2(14) OF THE I.T . ACT. THIS PART OF THE GROUNDS OF APPEAL IS DISMISSED. SECONDLY, IN VIEW OF THE ABOVE DISCUSSED ORDERS OF THE REVENUE AUTHORITIES, THE VALUATION HAS TO BE TAKEN AT RS. 12,00,000/- AND CAPITAL GAINS TA X COMPUTED ACCORDINGLY. THE ADDITION BASED ON THE VALUE OF RS. 89,94,725/- IS NOT UPHELD AND IS DIRECTED TO BE DELETED. IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE CASE WHEN THE AO MADE THE ADDITION ON THE BASIS OF THE ENHANCED VALUATION BY THE STAMP VALUATION AUTHORITY WHICH WAS SUBSEQUENTLY REVISED TO THE ORIGINAL VALUATION OF R S. 12,00,000/-, THEN THE ADDITION MADE BY THE AO WOULD NOT SURVIVE. ACCORDINGLY, WE DO NOT FIND ANY ERROR OR ILLEGALITY IN THE IMPUGNED ORDER OF THE LD. CIT (A) . 4. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D. ORDER PRONOUNCED IN THE OPEN COURT ON 14/05/2 018. SD/- SD/- HKKXPUN FOT; IKY JKWO (BHAGCHAND) ( VIJAY PAL RAO ) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 15/05/2018. DAS/ 5 ITA NO. 106/JP/2018 SHRI CHAIN SINGH SINGHVI, BARAN. VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT-THE ITO BARAN. 2. IZR;FKHZ@ THE RESPONDENT-SHRI CHAIN SINGH SINGHVI, BARAN. 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDR@ CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR 6. XKMZ QKBZY@ GUARD FILE {ITA NO. 106/JP/2018} VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASST. REGISTRAR