Subodh Yadav, Lucknow V. Income Tax Officer, Lucknow

ITA 112/LKW/2015

• Counselvise Citation: 11223714 RSA 2015
• Duration Of Justice: 10 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-12-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 09-02-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Additional evidence; Fair market value; Valuation report
• Section: 6

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH B, LUCKNOW BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER ITA NO.112/LKW/2015 ASSESSMENT YEAR:2010-2011 INCOME TAX OFFICER, LUCKNOW. VS SHRI SUBODH YADAV, 2/5, VIKAS KHAND, GOMTI NAGAR, LUCKNOW. PAN:ABKPY7247C (RESPONDENT) (APPELLANT) SHRI DHARMENDRA KUMAR, C. A. APPELLANT BY SHRI AMIT NIGAM, D. R. RESPONDENT BY 20/10/2015 DATE OF HEARING 31 / 12 /2015 DATE OF PRONOUNCEMENT O R D E R PER A. K. GARODIA, A.M. THIS IS ASSESSEES APPEAL DIRECTED AGAINST THE OR DER PASSED BY LEARNED CIT(A)-I, LUCKNOW DATED 01/10/2014 FOR THE ASSESSMENT YEAR 2010-2011. 2. IN THIS APPEAL, THE ASSESSEE HAS RAISED THE FOLL OWING GROUNDS: 1. THAT LD. COMMISSIONER (APPEALS) FAILED TO CONSI DER THE FACT AND SUBMISSION OF APPELLANT AND FAILED TO CONS IDER THAT FAILURE OF LD. AO OF DISPOSING OF THE OBJECTIO NS RAISED BY APPELLANT AGAINST THE VALUATION REPORT IS SUED BY VALUATION OFFICER. 2. THAT LD. LOWER AUTHORITY UPHELD THE ADDITION MAD E BY LD.AO IN SHORT TERM CAPITAL GAIN AMOUNTING TO RS.21,84,375/-, WITHOUT APPRECIATING THE FACTORS AFFECTING THE MARKET PRICE OF PROPERTY, INCORRECT B ASIS OF MAKING VALUATION BY VALUATION OFFICER AND GOVERNMEN T 2 POLICY FOR FIXING CIRCLE RATE OF PROPERTY FOR STAMP VALUATION. 3. THAT LD. LOWER AUTHORITY UPHELD THE DISALLOWANCE OF THE BROKERAGE OF RS.96,000/- PAID IN RESPECT OF SALE OF PROPERTY, WITHOUT APPRECIATING THE DETAILS AND RECO RDS PRODUCED BEFORE LOWER AUTHORITIES. 4. THAT LD. LOWER AUTHORITY FAILED TO APPRECIATE TH E FACTS THAT THERE WAS NO DEVELOPMENT IN INFRASTRUCTURE BETWEEN THE PERIOD OF PURCHASE AND SALE OF PROPERTY , WHEREAS, D.M. CIRCLE RATE WAS ENHANCED BY 35% FROM THE DATE OF PURCHASE TO THE DATE OF SALE, FURTHER, VALUATION OFFICER HAD NOT REFERRED ANY STATISTIC OF MARKET VALUE OF PROPERTIES IN SAME LOCALITIES, WHIL E MAKING VALUATION OF PROPERTY. 5. THAT SINCE LD.AO FAILED TO DISPOSE OF THE OBJECT ION RAISED BY APPELLANT; HENCE, ASSESSMENT ORDER PASSED BY LD.AO IS ILLEGAL, AGAINST THE LAW OF NATURAL JUSTIC E AND WITHOUT JURISDICTION. 3. IT WAS SUBMITTED BY LEARNED A. R. OF THE ASSESSE E THAT ON PAGES 99 TO 100 OF THE PAPER BOOK ARE THE OBJECTIONS FILED B Y THE ASSESSEE BEFORE THE D.V.O. IN WHICH IT IS STATED BY THE ASSESSEE TH AT THE PLOT IN QUESTION IS SITUATED AT THE LAST ROW OF VIKALP KHAND SCHEME OF LUCKNOW DEVELOPMENT AUTHORITY AND VIKALP KHAND IS LAST SCHEME OF LUCKNO W DEVELOPMENT AUTHORITY IN THAT AREA. IT WAS ALSO SUBMITTED THAT THERE WAS NO PUBLIC TRANSPORT IN THAT LOCATION AND THEREFORE, ONE CAN R EACH AT THE PLACE BY HIS PRIVATE CONVEYANCE ONLY. IT WAS ALSO SUBMITTED THA T THE ROAD WAS NOT CONSTRUCTED AND IT WAS VERY DIFFICULT TO REACH AT T HE SITE BY PRIVATE CONVEYANCE ALSO. ONE MORE SUBMISSION WAS MADE THAT THERE WAS NO COLONY AND NOBODY WAS RESIDING AT THAT PLACE DURING THAT PERIOD AND THERE WAS NO STREET LIGHT, NO DRAINAGE SYSTEM AND NO INFR ASTRUCTURE SUCH AS SHOPS, BANK ETC. AT NEARBY PLACES. IT WAS ALSO POI NTED OUT THAT THE SAME WAS THE CONDITION AT THE TIME OF PURCHASE OF PLOT A ND AT THE TIME OF SALE OF 3 PLOT. HE ALSO POINTED OUT THAT AT THE TIME OF PURC HASE, CIRCLE RATE FIXED AS RS.7,000/- PER SQ. MTR. ADDED BY 15% FOR CORNER PLO T AND IN THIS MANNER, CIRCLE RATE FIXED BY STATE GOVERNMENT WAS RS.8,050 /- PER SQ. MTR. AND TOTAL VALUE DETERMINED WAS RS.41,07,512/-. IT WAS ALSO POINTED OUT THAT THE REAL MARKET PRICE WAS MUCH BELOW THAN THE CIRCL E RATE FIXED BY THE STATE GOVERNMENT FOR STAMP DUTY PURPOSES AND THEREF ORE, THE ASSESSEE COULD PURCHASE THE PLOT FOR A PRICE OF RS.30 LAC ON LY, WHICH WAS THE MARKET VALUE AT THAT TIME. HE ALSO POINTED OUT THAT AT TH E TIME OF SALE, THE SITUATIONS AND CIRCUMSTANCES REMAINED UNCHANGED BUT THE MARKET PRICE ROSE IN THE NATURAL WAY AND THEREFORE, THE ASSESSEE COULD SELL THE PLOT FOR RS.48 LAC IN JANUARY, 2010 BEING THE MARKET PRICE P REVALENT AT THAT POINT OF TIME. HOWEVER, THE STATE GOVERNMENT FIXED THE C IRCLE RATE AT RS.10,000/- PER SQ. MTR. ADDED WITH 35% FOR CORNER PLOT WHICH WAS PREVIOUSLY 15% AND THE CIRCLE RATE FOR THE STAMP DU TY PURPOSES AT THE TIME OF SALE WAS RS.13,500/- PER SQ. MTR. AND THE TOTAL VALUE CAME TO RS.68,88,375/- AS AGAINST SALE PRICE OF THE ASSESSE E AT RS.48 LAC. HE SUBMITTED THAT IN SPITE OF THESE OBJECTIONS RAISED BEFORE D.V.O., HE HAS BRUSHED ASIDE THESE OBJECTIONS ON ARBITRARY BASIS A ND THE ASSESSING OFFICER HAS ALSO NOT CONSIDERED THESE OBJECTIONS. RELIANCE WAS PLACED BY HIM ON THE TRIBUNAL DECISION RENDERED IN THE CASE OF CHAND RA BHAN AGARWAL VS. ADDL. CIT AS REPORTED IN [2012] 51 SOT 440 (I.T.A.T .) (KOLK). HE SUBMITTED THAT IN THIS CASE ALSO, PROPERTY IN QUEST ION WAS SOLD BY THE ASSESSEE FOR RS.65 LAC AND THE D.V.O. DETERMINED TH E VALUE AT RS.1,24,13,620/- BUT THE FAIR MARKET VALUE ASSESSED BY A.D.S.R. SUTAHATA WAS DETERMINED AT RS.71,18,872/- AND THE TRIBUNAL H ELD THAT THE VALUE DETERMINED BY A.D.S.R., SUTAHATA, GOVERNMENT OF WES T BENGAL SHOULD BE ADOPTED INSTEAD OF VALUE AS PER D.V.O. BECAUSE D.V. O. HAS NOT CONSIDERED VARIOUS OBJECTIONS RAISED BEFORE HIM. HE ALSO SUBM ITTED CERTAIN ADDITIONAL EVIDENCES BEING THE SALE DEEDS OF PLOTS AT VIKALP K HAND SCHEME, GOMTI 4 NAGAR MADE DURING THE PERIOD UNDER APPEAL AVAILABLE AT PAGES 124 TO 216 OF THE PAPER BOOK. HE ALSO SUBMITTED THAT ON PAGE NO. 123 OF THE PAPER BOOK IS THE ANALYSIS OF CIRCLE RATE AND SALE CONSID ERATION OF THE ASSESSEE WITH THESE FOUR INSTANCES OF PLOT TRANSFER AND AS P ER THE SAME, IT CAN BE SEEN THAT THE CIRCLE RATE WAS MUCH EXCESSIVE THAN T HE ACTUAL SALE CONSIDERATION IN ALL THESE FOUR CASES BY 100%, 52.5 4%, 360.51% AND 62.35% AS AGAINST 43.51% IN THE CASE OF THE ASSESSE E. 4. LEARNED D. R. OF THE REVENUE SUPPORTED THE ORDER OF THE AUTHORITIES BELOW. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FI ND THAT IN THE PRESENT CASE, THE DISPUTE IS REGARDING THE VALUATIO N DONE BY D.V.O. U/S 53C(2) OF THE ACT. AS PER THE SAID SECTION, THE PR OVISION CONTAINED IN SUB SECTIONS 6 & 7 OF SECTION 23A OF WEALTH TAX ACT, 19 57 ARE ALSO APPLICABLE. AS PER SUB-SECTION 6 OF SECTION 23A OF WEALTH TAX A CT, 1957, IF THE VALUATION OF ANY ASSET IS OBJECTED TO IN AN APPEAL, THE CIT(A) SHALL IN A CASE WHERE SUCH VALUATION HAS BEEN MADE BY THE VALU ATION OFFICER, SHOULD GIVE SUCH VALUATION OFFICER AN OPPORTUNITY OF BEING HEARD AND THEREAFTER, HE SHOULD DECIDE THE OBJECTIONS OF THE ASSESSEE REG ARDING VALUATION. IN THE PRESENT CASE ALSO, VALUATION DONE BY VALUATION OFFICER BEING D.V.O. HAS BEEN OBJECTED TO BY THE ASSESSEE BEFORE THE CIT (A) BUT HE HAS NEITHER GRANTED ANY OPPORTUNITY TO THE VALUATION OFFICER BE ING D.V.O. NOR DECIDED THE OBJECTIONS OF THE ASSESSEE REGARDING VALUATION DONE BY D.V.O. AND HAS SIMPLY HELD THAT THE ASSESSING OFFICER WAS JUSTIFI ED IN ADOPTING THE VALUE AS PER D.V.O. REPORT. HENCE, IN OUR CONSIDERED OPI NION, THIS MATTER SHOULD GO BACK TO CIT(A) FOR FRESH DECISION. WE, THEREFOR E, SET ASIDE THE ORDER OF CIT(A) ON THIS ISSUE AND RESTORE THE MATTER BACK TO CIT(A) FOR FRESH DECISION AFTER ALLOWING PROPER OPPORTUNITY OF BEING HEARD TO THE ASSESSEE, ASSESSING OFFICER AS WELL AS D.V.O. AND SHOULD PASS A SPEAKING AND 5 REASONED ORDER REGARDING VARIOUS OBJECTIONS OF THE ASSESSEE IN RESPECT OF VALUATION DONE BY D.V.O. NEEDLESS TO SAY, HE SHOUL D GRANT ADEQUATE OPPORTUNITY OF BEING HEARD TO ALL THE PARTIES I.E. ASSESSEE, ASSESSING OFFICER AND THE D.V.O. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE STANDS ALLOWED FOR STATISTICAL PURPOSES. (ORDER WAS PRONOUNCED IN THE OPEN COURT ON THE DATE MENTIONED ON THE CAPTION PAGE) SD/. SD/. (SUNIL KUMAR YADAV) ( A. K. GAROD IA ) JUDICIAL MEMBER ACCOUNTANT MEMB ER DATED:31/12/2015 *SINGH COPY OF THE ORDER FORWARDED TO : 1.THE APPELLANT 2.THE RESPONDENT. 3.CONCERNED CIT 4.THE CIT(A) 5.D.R., I.T.A.T., LUCKNOW ASSTT. REGIS TRAR