Ram Nivas Goyal , Hyderabad V. Income Tax Officer, Ward-7(3), Hyderabad

ITA 1279/Hyd/2019

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 3628 (ITAT-HYDERABAD)
• Duration Of Justice: 2 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-11-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB-A
• Next Hearing Date: 04-11-2019
• Assessment Year: 2011-2012
• Appeal Filed On: 14-08-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: K A SAI PRASAD
• Keywords: Sale consideration of property below Jantri Value; Set aside
• Section: 50C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES SMC, HYDERABAD BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER I.T.A. NO. 1279/HYD/2019 ASSESSMENT YEAR: 2011-12 RAM NIVAS GOYAL, HYDERABAD [PAN: ACGPG2692C] VS INCOME TAX OFFICER, WARD-7(3), HYDERABAD (APPELLANT) (RESPONDENT) FOR ASSESSEE : SHRI K.A.SAI PRASAD, AR FOR REVENUE : SHRI SUNKU SRINIVAS, DR DATE OF HEARING : 04-11-2019 DATE OF PRONOUNCEMENT : 11-11-2019 O R D E R THIS APPEAL FILED BY THE ASSESSEE FOR THE AY.2011-12 IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCO ME TAX (APPEALS)3, HYDERABAD, DATED 28-05-2019. 2. BRIEF FACTS OF THE CASE ARE THAT, THE ASSESSEE, AN INDIVIDUAL ALONG WITH THREE OTHERS HAD SOLD AN IMMOVE ABLE PROPERTY SITUATED AT MAHARAJGUNJ, HYDERABAD FOR A NET SALE CONSIDERATION OF RS.1,20,62,500/-. THE PROPERTY WAS ALLEGEDLY SOLD FOR A PRICE BELOW THE MARKET VALUE AND THE ASSESS ING OFFICER (AO) OBSERVED THAT THE PROVISIONS OF SECTION 50C OF THE INCOME TAX ACT [ACT] ARE APPLICABLE. SINCE THE ASSESSE E DID NOT FILE ANY RETURN OF INCOME, THE CASE OF THE ASSESSEE WA S RE- OPENED U/S.147 OF THE ACT. ITA NO. 1279/HYD/2019 :- 2 -: 2.1. IN RESPONSE TO THE NOTICE ISSUED BY THE AO, THE ASS ESSEE FILED DOCUMENTS AS CALLED-FOR AND AFTER CONSIDERING TH E SUBMISSIONS OF ASSESSEE, AO HELD THAT THE PROVISIONS O F SECTION 50C ARE APPLICABLE AND ACCORDINGLY, BROUGHT THE ASSESSEES SHARE OF LONG TERM CAPITAL GAIN TO TAX. 3. AGGRIEVED, THE ASSESSEE PREFERRED AN APPEAL BEFOR E THE CIT(A), WHO CONFIRMED THE ORDER OF AO AND THE ASSESSE E IS IN SECOND APPEAL BEFORE THE TRIBUNAL. 4. THE LD.COUNSEL FOR THE ASSESSEE, SHRI K.A.SAI PRA SAD, REITERATING THE SUBMISSIONS MADE BY THE ASSESSEE BEFOR E THE AUTHORITIES BELOW, HAS DRAWN MY ATTENTION TO THE ASSESSE ES SUBMISSIONS BEFORE THE AO WHICH ARE PLACED AT PGS.1 TO 3 OF THE PAPER BOOK. HE SUBMITTED THAT THE ASSESSEE HAS CLEA RLY BROUGHT OUT THE DRAWBACKS AND DEFICIENCIES IN THE PROP ERTY, SUCH AS PROPERTY WAS OCCUPIED BY THE TENANT VIZ., M/S.HINDUSTAN PETROLEUM CORPORATION LTD., [HPCL] FOR MO RE THAN 50 YEARS AND THOUGH THE LEASE PERIOD OF HPCL ENDE D ON 30-06-2009 AND THE TENANT HPCL IS NOT READY TO VACATE THE PROPERTY, DUE TO WHICH, THE PROPERTY REMAINED UN-SOLD . IT WAS ALSO SUBMITTED THAT THE PROPERTY IS SITUATED IN A BY-LAN E I.E., MORE THAN 200 SFT., AWAY FROM THE MAIN ROAD. THEREFORE , THE PROPERTY HAD TO BE SOLD AT A LESSER PRICE. HE ALSO SU BMITTED THAT THOUGH ALL THESE ELABORATE SUBMISSIONS HAVE BEEN MA DE BEFORE THE AO AND THAT THESE FACTS WERE ALSO INCORPORATED IN THE REGISTERED SALE DEED, DEMONSTRATING THE DIFFICULTIES/DEFICIENCIES IN THE PROPERTY, THE AO/CIT (A) HAVE NOT TAKEN THE SAME INTO CONSIDERATION AND HAVE SUMMARIL Y ITA NO. 1279/HYD/2019 :- 3 -: APPLIED THE PROVISIONS OF SECTION 50C OF THE ACT, WITH OUT EVEN REFERRING THE VALUATION OF THE PROPERTY TO THE DEPARTMEN TAL VALUATION OFFICER (DVO). HE FURTHER RELIED ON THE DEC ISION OF THE LD.CIT(A) IN THE CASE OF CO-OWNER, SHRI RAJENDER PRASAD GOYAL, WHEREIN THE ADDITION HAS BEEN DELETED BY THE C IT(A) BY FOLLOWING THE DECISION OF THE HON'BLE ITAT IN THE CASE OF MR.MUCHERLA SATYANARAYANA SRIKANTH VS. ACIT IN ITA NO.756/HYD/2016, DT.31-08-2017. 5. LD.DR, ON THE OTHER HAND, SUPPORTED THE ORDERS OF TH E AUTHORITIES BELOW AND SUBMITTED THAT THOUGH THE ASSESSEE HAS BROUGHT OUT THE DEFICIENCIES IN THE PROPERTY IN THE SU BMISSIONS BEFORE THE AO, HE HAS NOT MADE ANY SPECIFIC REQUEST FO R REFERRING THE SAME TO THE VALUATION CELL AND THEREFORE , THE AO HAS PROCEEDED TO APPLY THE PROVISIONS OF SECTION 50C O F THE ACT. 6. HAVING REGARD TO THE RIVAL CONTENTIONS AND MATERIAL ON RECORD, I FIND THAT THE ASSESSEE IS THE OWNER OF THE PRO PERTY ALONG WITH THREE OTHERS AND THE PROPERTY IS BEING OCCUP IED BY THE TENANT, HPCL, WHO WAS NOT WILLING TO VACATE THE PREMIS ES EVEN AFTER THE LAPSE OF THE LEASE PERIOD AND ALSO THE P ROPERTY IS SITUATED IN A BY-LANE MORE THAN 200 SFT., AWAY FROM THE MAIN ROAD AND THAT THESE FACTS HAVE ALSO BEEN BROUGHT OUT IN THE REGISTERED SALE DEED. BOTH THE AO AS WELL AS THE CIT(A ) HAVE FAILED TO NOTE THE RELEVANT DEFICIENCIES AND REFER THE M ATTER TO THE DVO. IN FACT, IN THE CASE OF THE CO-OWNER, SHRI R AJENDER PRASAD GOYAL, THE LD.CIT(A) HAS CONSIDERED ALL THE RE LEVANT DEFICIENCIES TO HOLD THAT THE PROVISIONS OF SECTION 50C ARE NOT ITA NO. 1279/HYD/2019 :- 4 -: APPLICABLE TO THE CASE OF THE RELEVANT PROPERTY. SINCE THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE ARE SAME AND THE LD.DR HAS NOT BEEN ABLE TO REBUT THE FINDINGS OF THE LD. CIT(A) IN THE CASE OF THE CO-OWNER WITH ANY EVIDENCE TO THE LA ND AS THERE IS NO PROOF OF SUCH A FINDING BEING SET ASIDE C ONTRARY, I AM INCLINED TO DELETE THE ADDITION MADE BY THE AO U/S.5 0C OF THE ACT IN THE HANDS OF THE ASSESSEE BEFORE ME, BY ALL OWING THE GROUND RAISED BY ASSESSEE. 7. IN THE RESULT, THE APPEAL OF ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 11 TH NOVEMBER, 2019 SD/- (P. MADHAVI DEVI) JUDICIAL MEMBER HYDERABAD, DATED: 11-11-2019 TNMM ITA NO. 1279/HYD/2019 :- 5 -: COPY TO : 1. SHRI RAM NIVAS GOYAL, C/O. KATRAPATI & ASSOCIATE S, 1-1-298/2/B/3, 1 ST FLOOR, ASHOK NAGAR, HYDERABAD. 2. INCOME TAX OFFICER, WARD-7(3), HYDERABAD. 3. CIT(APPEALS)-3, HYDERABAD. 4. PR.CIT-3, HYDERABAD. 5. D.R. ITAT, HYDERABAD. 6. GUARD FILE.