MR. MANOJ H. NATHANI, MUMBAI V. ITO(IT)-4(1), MUMBAI

ITA 1151/MUM/2009

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 7602 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-02-2010
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2006-2007
• Appeal Filed On: 19-02-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PITAMBAR DAS; L K AGRAWAL S S RANA
• Assessee Lawyers: M B AGRAWAL
• Keywords: Capital asset; Cost of acquisition; Fair market value; Valuation report

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES B, MUMBAI BEFORE SHRI R.S.SYAL, AM AND SHRI R.S.PADVEKAR, JM ITA NO.1151/MUM/2009 : ASST.YEAR 2006-2007 SHRI MANOJ H.NATHANI C/O.MR.CHANDRU JOTE 24 JUPITER APARTMENTS CUFFE PARADE, MUMBAI 400 005. PA NO.AALPN7918B. VS. THE INCOME TAX OFFICER (IT) WARD 4(1) MUMBAI. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI M.B.AGRAWAL RESPONDENT BY : S/SHRI L.K.AGRAWAL, S.S.RANA & PITA MBAR DAS O R D E R PER : R.S.SYAL, AM : THIS APPEAL BY THE ASSESSEE ARISES OUT OF THE ORDER PASSED BY THE COMMISSIONER OF INCOME-TAX (APPEALS) ON 22.12.2008 IN RELATION TO THE ASSESSMENT YEAR 2006-2007. 2. THE ONLY ISSUE IN THIS APPEAL IS AGAINST NOT AL LOWING INDEXATION BENEFIT FROM THE DATE THE ASSET WAS HELD BY THE PREVIOUS OWNER. BRIEFLY STATED THE FACTS OF THE CASE ARE THAT THE ASSESSEE SOLD FLAT NO.182-B AS C O-OWNER ALONG WITH MS.SARSWATI BUTANI. THE SHARE OF THE ASSESSEE AT 50% IN SALE CONSIDERATION WAS RS.1.60 CRORE. THIS FLAT WAS ORIGINALLY PURCHASED ON 20.12.1971 BY LATE MS.KALA BUTANI AND MS.SARSWATI BUTANI. AS PER THE VALUATION REPORT DAT ED 30.5.2005, THE MARKET VALUE OF THE PROPERTY AS ON 1.4.1981 WAS RS.18,49,150. WH ILE COMPUTING THE LONG TERM CAPITAL GAIN, THE ASSESSEE TOOK COST INFLATION IND EX OF FINANCIAL YEAR 1981-82 AS BASE AND COMPUTED INDEXED COST OF ACQUISITION AND R ESULTANT LONG TERM CAPITAL GAIN AT RS.NIL. THE ASSESSING OFFICER DID NOT ACCEPT THE COMPUTATION MADE BY THE ASSESSEE AS IN HIS OPINION THE FAIR MARKET VALUE AS ON 1.4.1981 COULD NOT BE ACCEPTED AND SINCE THE ASSESSEE HELD ASSET FOR THE FIRST TIME IN FINANCIAL YEAR 1997- 98 IT WAS TO BE CONSIDERED ACCORDINGLY. HE, THEREFO RE, COMPUTED THE LONG TERM ITA NO.1151/MUM/2009 SHRI MANOJ H.NATHANI. 2 CAPITAL GAIN AT RS.1.42 CRORE AND AFTER ALLOWING DE DUCTION U/S.54EC DETERMINED THE TAXABLE LONG TERM CAPITAL GAIN AT RS.32.01 LAKHS. N O RELIEF WAS ALLOWED IN THE FIRST APPEAL. 3. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIAL ON RECORD. THE QUESTION RAISED IN THIS APPEAL IS NO MO RE RES INTEGRA QUA THIS FORUM IN VIEW OF THE ORDER PASSED BY THE SPECIAL BENCH OF TH E TRIBUNAL IN DCIT VS. MANJULA SHAH [(2009) 318 ITR (AT) 417 (MUM.) (SB)] . IN THIS CASE IT HAS BEEN HELD THAT THE INDEXATION IS TO BE ALLOWED WITH REFERENCE TO THE YEAR IN WHICH THE PREVIOUS OWNER ACQUIRED THE ASSET AND NOT WHEN THE ASSESSEE CAME INTO POSSESSION OF THE CAPITAL ASSET. IN VIEW OF THE FACT THAT THE PREVIOU S OWNER ACQUIRED THIS CAPITAL ASST PRIOR TO 01.04.1981, THE CALCULATION OF INDEXED CO ST OF ACQUISITION AS MADE BY THE ASSESSEE HAS TO BE ACCEPTED. WE, THEREFORE, OVERTUR N THE IMPUGNED ORDER ON THIS ISSUE. 4. IN THE RESULT, THE APPEAL IS ALLOWED. ORDER PRONOUNCED ON THIS 23 RD DAY OF FEBRUARY, 2010. SD/- SD/- ( R.S.PADVEKAR ) ( R.S.SYAL ) JUDICIAL MEMBER ACCOUNTANT ME MBER MUMBAI : 23 RD FEBRUARY, 2010. DEVDAS* COPY TO : 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT CONCERNED 4. THE CIT(A) XXXIII, MUMBAI. 5. THE DR/ITAT, MUMBAI. 6. GUARD FILE. ITA NO.1151/MUM/2009 SHRI MANOJ H.NATHANI. 3 TRUE COPY. BY ORDER ASSISTANT REGISTRAR, ITAT, MUMBAI.