Shri Narinderkumar Dhanaute, RAJKOT-GUJARAT V. The Income Tax Officer, Ward-1, GANDHIDHAM

ITA 111/RJT/2014

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 6689 (ITAT-RAJKOT)
• Duration Of Justice: 3 year(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-02-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 20-02-2017
• Assessment Year: 2009-2010
• Appeal Filed On: 04-02-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: LALIT P JAIN
• Keywords: Sale consideration of property below Jantri Value
• Section: 50C; 54F

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL, RAJKOT [CONDUCTED THROUGH E COURT AT AHMEDABAD] BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER ./ ITA.NO.111/RJT/2014 ASSTT.YEAR : 2009-2010 SHRI NARINDEREKAU DHANAUTE C/O. KALPESH S. DOSHI & CO. CHARTERED ACCOUNTANTS 411, COSMOS COMPLEX MAHILA COLLEGE CIRCLE RAJKOT 360 001. VS ITO, WARD - 1 GANDHIDHAM. '( / (APPELLANT) )* '( / (RESPONDENT) ASSESSEE BY : SHRI KALPESH DOSHI, DR REVENUE BY : SHRI LALIT P. JAIN, SR.DR / DATE OF HEARING : 20/02/2017 / DATE OF PRONOUNCEMENT: 22/02/2017 +,-/ O R D E R PER RAJPAL YADAV, JUDICIAL MEMBER: ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL AGAINST O RDER OF THE LD.CIT(A)-II, RAJKOT DATED 16.12.2013 PASSED FOR TH E ASSTT.YEAR 2009-10. 2. SOLE GRIEVANCE OF THE ASSESSEE IS THAT THE LD.CI T(A) HAS ERRED IN CONFIRMING ADDITION OF RS.5,11,297/- WHICH WAS ADDE D BY THE AO ON ACCOUNT OF CAPITAL GAIN RECEIVED BY THE ASSESSEE ON SALE OF HOUSE PROPERTY. 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE HA S FILED RETURN OF INCOME ON 19.1.2010 DECLARING TOTAL INCOME AT RS.1,76,901/ -. THE CASE OF THE ASSESSEE SELECTED FOR SCRUTINY ASSESSMENT AND NOTIC E UNDER SECTION 143(2) WAS ISSUED AND SERVED UPON THE ASSESSEE. ON SCRUTINY O F THE ACCOUNTS, IT EMERGES ITA NO.111/RJT/2014 2 OUT TO THE AO THAT THE ASSESSEE HAS TWO PROPERTIES WHICH WERE SOLD DURING THE YEAR. PROPERTY SITUATED AT SURVEY NO.265 AT MITHIR OHAR WAS JOINTLY OWNED BY THE ASSESSEE WITH SMT.KULVINDERE KAUR IN EQUAL SHAR ES. SIMILARLY, SHE WAS OWNER AND IN POSSESSION OF A PROPERTY COMPRISED AT SURVEY NO.312/1, CHIRAI BHACHU. BOTH THESE PROPERTIES HAVE BEEN SOLD BY TH E ASSESSEE DURING THE YEAR, AND SHE PURCHASED A RESIDENTIAL HOUSE AND CLAIMED D EDUCTION UNDER SECTION 54F OF RS.41,70,200/-. THE DISPUTE BETWEEN THE ASS ESSEE AND THE AO AROSE IN RELATION TO COMPUTATION OF LONG TERM CAPITAL GAIN, BECAUSE SECOND PROPERTY WAS SOLD BY THE ASSESSEE AT RS.10 LAKHS, BUT WITH T HE HELP OF DEEMING FICTION PROVIDED IN SECTION 50C THIS SALE CONSIDERATION WAS REPLACED WITH A SUM OF RS.18.50 LAKHS ON WHICH STAMP DUTY WAS PAID BY THE VENDEE FOR THE PURPOSE OF REGISTRATION OF SALE DEED. THIS SALE CONSIDERAT ION WAS ASSUMED BY THE AO FOR THE PURPOSE OF CALCULATING CAPITAL GAIN AS PER SECTION 48 OF THE INCOME TAX ACT. ACCORDING TO THE ASSESSEE BENEFIT OF HIGHER SA LE CONSIDERATION ASSUMED FOR THE PURPOSE OF COMPUTING CAPITAL GAIN, OUGHT TO BE GIVEN FOR THE PURPOSE OF CALCULATING INVESTMENT MADE BY THE ASSESSEE IN N EW RESIDENTIAL HOUSE AND ADMISSIBILITY OF DEDUCTION UNDER SECTION 54F OF THE ACT BE COMPUTED ACCORDINGLY. ANYHOW IN THE PRESENT APPEAL, WE DO N OT DEEM IT NECESSARY TO GO INTO THESE ISSUES AT THIS STAGE, SIMPLE REASON I S THAT THE LD.CIT(A) HAS NOT DECIDED ALL THE GROUNDS OF APPEAL RAISED BY THE ASS ESSEE. LET US EVALUATE THIS ASPECT. 4. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL BEFORE THE LD.CIT(A): 1. THAT, THE LEARNED ASSESSING OFFICER HAS WRONGL Y CONSIDERED SHARE IN SALE VALUE OF IMMOVABLE PROPERTY VIDE SURVEY NO. 312/1 AT RS.29,79,720/- AS AGAINST RS.25,89,860/-. 2. THAT, THE LEARNED AO HAS WRONGLY MADE ADDITION OF CAPITAL GAIN OF RS.5,11,298/- ITA NO.111/RJT/2014 3 3. THAT, THE LEARNED AO HAS WRONGLY COMPUTED INTER EST U/S 234 A, B AND C OF THE IT ACT 4. THAT, THE FINDINGS OF THE LEARNED ASSESSING OFF ICER ARE NOT JUSTIFIED AND ARE REQUIRED TO BE DELETED. 5. A PERUSAL OF THE FINDING OF THE LD.CIT(A) WOULD INDICATE THAT THE LD.CIT(A) HAS CONSIDERED THE COMPUTATION OF CAPITAL GAIN WITH REGARD TO THE PROPERTY HELD BY THE ASSESSEE UNDER JOINT OWNERSHIP . HE DID NOT TOUCH THE SALE OF SECOND PROPERTY. ORDER OF THE LD.CIT(A) IS VERY BRIEF AND IT CAN BE NOTED AS UNDER: 2. THE APPEAL WAS FIXED FOR HEARING ON VARIOUS DAL ES AS PER ORDER SHEET. HEARING NOTICES WERE SERVED TO BOTH THE A.O, AND THE APPELLANT. HOWEVER, THE ASSESSING OFFICER DID NOT ATTEND THE P ROCEEDINGS. SHRI KALPESH DOSHI. C.A. & A.R. OF THE APPELLANT ATTENDE D AND FILED WRITTEN SUBMISSION. THE CASE WAS HEARD. 3. THE FACTS OF THE CASE ARE THAT DURING THE YEAR T HE APPELLANT HAD SOLD A PROPERTY, SITUATED AT MITHI ROHAR, JOINTLY HELD W ITH SMT. KULVINDER KAUR FOR A TOTAL CONSIDERATION OF RS.51,79,920/-. W HILE COMPUTING THE I.TCG, THE A.O. HELD THE SHARE OF SMT. KULVINDER KA UR AT RS.22,00,000/- AS CLAIMED BY HER IN HER RETURN OF I NCOME. ACCORDINGLY, THE A.O. COMPUTED THE CAPITAL GAIN IN RESPECT OF TH IS PROPERTY AT RS.29,28,666/-. 4. DURING THE COURSE OF APPELLATE PROCEEDINGS, THE APPELLANT SUBMITTED A CHART SLATING THAT THE SHARE OF SMT. KU LVINDER KAUR RS.25,89,860/- (50% OF THE TOTAL SALE AMOUNT) AND R ECOMPUTED THE TAXABLE I.TCG IN THE HANDS OF THE APPELLANT AT RS.1 ,92,726/-. THE APPELLANT ALSO SUBMITTED COPY OF THE SALE DEED WHER EIN IT IS MENTIONED ON PAGE-10 THAT SMT. KULVINDER KAUR HAD RECEIVED RS .25,89,860/- BY WAY OF SALE CONSIDERATION. THE APPELLANT CONTENDED THAT ON THIS BASIS THE LTCG SHOULD BE COMPUTED AS ABOVE. 5. I HAVE CAREFULLY CONSIDERED THE ASSESSMENT ORDE R AND THE SUBMISSION GIVEN BY THE APPELLANT. I HAVE ALSO PERU SED COPY OF RETURN OF SMT. KULVINDER KAUR. THE A.O. HAS CORRECTLY HELD TH E SHARE OF SMT. KULVINDER KAUR, AS REPORTED BY HER, AT RS.22,00,000 /- IN COMPUTING THE LTCG. NO EXPLANATION WAS GIVEN BY THE A.R. AS TO WH Y THIS FIGURE WAS ADOPTED BY SMT. KULVINDER KAUR IN HER RETURN OF INC OME EVEN THOUGH ITA NO.111/RJT/2014 4 SHE HAD RECEIVED RS.25,89,860/-. SHE COULD HAVE EAS ILY REVISED HER RETURN OF INCOME TO CORRECT (HIS MISTAKE. AS SMT. K UIVINDER KAUR HAD CLAIMED ONLY RS.22,00,000/- AS THE AMOUNT RECEIVED BY HER. 6. WITH THE ASSISTANCE OF THE LD.REPRESENTATIVES, W E HAVE GONE THROUGH THE RECORD CAREFULLY. WE FIND THAT THE LD.CIT(A) HAS N OT CONSIDERED ONE OF THE GROUND RAISED BY THE ASSESSEE, AND THE GROUND WHICH WAS CONSIDERED BY THE CIT(A) HAS ALSO A BEARING ON THE ULTIMATE DETERMINA TION OF LONG TERM CAPITAL GAIN IN THE HANDS OF THE ASSESSEE. WE THEREFORE, S ET ASIDE THE ORDER OF THE CIT(A) AND RESTORE ALL THE ISSUES TO THE FILE OF TH E LD.CIT(A) FOR RE- ADJUDICATION. THE ASSESSEE WILL BE AT LIBERTY TO P RODUCE ANY DETAILS IN SUPPORT OF HER EXPLANATION BEFORE THE LD.CIT(A). 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE COURT ON 22 ND FEBRUARY, 2017 AT AHMEDABAD. SD/- SD/- ( PRADIP KUMAR KEDIA ) ACCOUNTANT MEMBER (RAJPAL YADAV) JUDICIAL MEMBER AHMEDABAD; DATED 22/02/2017