Mohammad Iftekharuddin, Sec'bad, Hyderabad V. ITO, Ward-10(1), Hyderabad, Hyderabad

ITA 121/HYD/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 6004 (ITAT-HYDERABAD)
• Duration Of Justice: 9 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-11-2016
• Appeal Filed By: Assessee
• Bench Allotted: A
• Next Hearing Date: 22-11-2016
• Assessment Year: 2006-2007
• Appeal Filed On: 08-02-2016
• Court: TRIBUNAL
• Department Lawyers: A SITARAMA RAO
• Assessee Lawyers: A V RAGHURAM
• Keywords: Sale consideration of property below Jantri Value; Capital asset
• Section: 50C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES B (SMC), HYDERABAD BEFORE SHRI D. KARUNAKARA RAO, ACCOUNTANT MEMBER I.T.A. NO. 121/HYD/2016 ASSESSMENT YEAR: 2006-07 MOHAMMAD IFTEKHARUDDIN, SECUNDERABAD [PAN: ADMPM6748E] VS THE I.T.O., WARD-10(1), HYDERABAD (APPELLANT) (RESPONDENT) FOR ASSESSEE : SHRI A.V. RAGHU RAM, AR FOR REVENUE : SHRI A. SITARAMA RAO, DR DATE OF HEARING : 25-11-2016 DATE OF PRONOUNCEMENT : 25-11-2016 O R D E R THIS IS AN APPEAL BY THE ASSESSEE AGAINST THE ORDER O F THE COMMISSIONER OF INCOME TAX (APPEALS)-6, HYDERABAD D ATED 21-12-2015 FOR THE AY. 2006-07. ASSESSEE RAISED FO UR GROUNDS, OF WHICH THE LEGAL ISSUE RAISED IS IN GROUND NO. 2, REL ATES TO CIT(A)S FAILURE TO MAKE A REFERENCE ENVISAGED IN THE PROVISI ONS OF SECTION 50C OF THE INCOME TAX ACT [ACT]. IN THIS REGARD, LD. COUNSEL BROUGHT OUR ATTENTION TO THE CONTENTS OF THE PARA 6 OF THE CIT(A)S ORDER AND MENTIONED THAT THE ASSESSEE REQUESTED THE CIT( A) FOR THE FIRST TIME IN WRITING TO MAKE A REFERENCE TO THE DVO REGA RDING THE VALUATION OF THE IMMOVABLE PROPERTY-IN-QUESTION. AS PER THE CONTENTS OF PARA 6, CIT(A) DID NOT APPROVE THE REQUEST A ND ULTIMATELY REJECTED THE SAME BEFORE DISMISSING THE APP EAL OF THE ASSESSEE. I.T.A. NO. 121/HYD/2016 :- 2 -: 2. BEFORE US LD. COUNSEL FOR THE ASSESSEE ARGUED THAT THERE IS NO DISPUTE ABOUT THE NATURE OF THE ASSET-IN-QUESTION, IF THE SAME CONSTITUTES A CAPITAL ASSET AND NOT STOCK-IN-TRADE. ORIGIN ALLY, ASSESSEE ARGUED BEFORE THE LOWER AUTHORITIES STATING THAT THE ASSET- IN-QUESTION IS A BUSINESS ASSET. CONSIDERING THE ABSEN CE OF ANY DISPUTE ON THE NATURE OF THE CAPITAL ASSET, NOW THE QUESTIO N UNDER DISPUTE RELATES TO THE VALUE OF THE ASSET. IT IS THE SUBM ISSION OF THE ASSESSEE THAT THE SAID ASSET WAS SOLD FOR THE LOWER PRI CE THAN THE PRICE FIXED BY THE SRO. AS PER ASSESSEE, IT IS THE CA SE OF DISTRESS SALE AND THEREFORE, THE VALUE IS MUCH LOWER THAN THE G UIDELINE VALUE. ASSESSEE RELIES ON THE SALE DEED IN SUPPORT O F HIS CLAIM. 3. ON HEARING LD. DR FOR THE REVENUE, WHOSE CORE AR GUMENT IS THAT THE CIT(A) IS NOT VESTED WITH SUCH POWERS FOR MAKI NG REFERENCES OF THE IMMOVEABLE PROPERTIES TO THE DVO, I P ROCEED TO ADJUDICATE AS UNDER. 4. THE MOVE IN QUESTION RELATES TO IF THE ITAT CAN AD MIT THIS LEGAL ISSUE AND DIRECT THE AO TO EXAMINE THE CONTENTIONS FOR REFERRAL TO THE DVO. I AM OF THE OPINION THAT THIS BEI NG LEGAL ISSUE, I ADMIT THE SAME AND REFER THE ISSUE TO THE FILE OF THE A O WITH THE DIRECTION THAT THE ASSESSEE SHOULD DEMONSTRATE BEFORE TH E AO THAT THE CONDITIONS FOR MAKING A REFERENCE TO THE DVO SHOUL D BE SATISFACTORILY DEMONSTRATED BEFORE THE AO WITH THE DOCU MENTS IF ANY. WITH THESE DIRECTIONS, I ADMIT THAT LEGAL GROUND AN D REMAND TO THE FILE OF THE AO FOR FRESH ASSESSMENT AFTER MAKIN G A REFERENCE IF ANY TO THE DVO. ACCORDINGLY, ALL THE GROUNDS RELATIN G TO MERITS RAISED BY THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURP OSES. FURTHER, THE LEGAL ISSUE IS ALLOWED IN FAVOUR OF THE A SSESSEE. I.T.A. NO. 121/HYD/2016 :- 3 -: 5. IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALL OWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 25 TH NOVEMBER, 2016 SD/- (D. KARUNAKARA RAO) ACCOUNTANT MEMBER HYDERABAD, DATED 25 TH NOVEMBER, 2016 TNMM COPY TO : 1. MOHAMMAD IFTEKHARUDDIN, SECUNDERABAD. C/O. K. VASANT KUMAR, A.V. RAGHU RAM, P. VINOD, ADVOCATE S, 610, BABUKHAN ESTATE, BASHEERBAGH, HYDERABAD. 2. THE INCOME TAX OFFICER, WARD-10(1), HYDERABAD. 3. COMMISSIONER OF INCOME TAX(APPEALS)-6, HYDERABAD 4. PR. COMMISSIONER OF INCOME TAX-6, HYDERABAD. 5. D.R. ITAT, HYDERABAD. 6. GUARD FILE.