Kamla Rani, Delhi V. ITO, Ward- 37(1), New Delhi

ITA 1366/DEL/2019

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 6232 (ITAT-DELHI)
• Duration Of Justice: 5 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-08-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2015-2016
• Appeal Filed On: 19-02-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: P.D. MITTAL
• Keywords: Cost of acquisition; Valuation report; Capital Gains
• Section: 37(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: SMC NEW DELHI BEFORE SHRI R.K. PANDA, ACCOUNTANT MEMBER ITA NO. 1366/DEL/2019 ASSESSMENT YEAR: 2015-16 KAMLA RANI FLAT NO. 67/D-15, SECTOR-7, ROHINI, DELHI. PAN NO. AAJPR1165Q VS ITO WARD 37(1) NEW DELHI. APPELLANT RESPONDENT ASSESSEE BY SHRI P.D. MITTAL, CA REVENUE BY SHRI S.L. ANURAGI, SR. DR ORDER THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER DATED 12.12.2018 OF THE LD. CIT(APPEALS)-13, NEW DE LHI RELATING TO AY 2015-16. 2. FACTS OF THE CASE, IN BRIEF, ARE THAT THE ASSESS EE IS AN INDIVIDUAL AND FILED HER RETURN OF INCOME ON 21.12. 2015 DECLARING TOTAL INCOME OF RS. 2,02,892/-. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE AO ASKED THE ASSESSEE TO SUBSTANTI ATE THE INDEXED COST OF ACQUISITION IN RELATION TO THE PROP ERTY SOLD ON WHICH LTCG HAS BEEN SHOWN. SINCE, THE ASSESSEE COU LD NOT SUBSTANTIATE THE EVIDENCE REGARDING THE COST OF RED EVELOPMENT DATE OF HEARING 01.08.2019 DATE OF PRONOUNCEMENT 06.08.2019 2 ITA NO . 1366/DEL/2019 EXPENSES FOR CALCULATING THE INDEXED COST OF ACQUIS ITION THE AO MADE AN ADDITION OF RS. 20,15,685/- OUT OF THE AMOU NT OF RS. 24,52,085/- CLAIMED BY THE ASSESSEE. SIMILARLY, TH E AO ALSO MADE AN ADDITION OF RS. 9,11,677/- U/S 45 OF THE INCOME TAX ACT. THUS, THE AO DETERMINED THE TOTAL INCOME OF THE ASSESSEE AT RS. 31,30,254/-. 3. IN APPEAL, THE LD. CIT(A) DELETED THE ADDITION O F RS. 20,15,685/- MADE BY THE AO ON ACCOUNT OF COST OF RE DEVELOPMENT EXPENSES FOR WHICH THE REVENUE IS NOT IN APPEAL. S O FAR AS THE ADDITION OF RS. 9,11,677/- MADE BY THE AO WHILE WOR KING OF THE CAPITAL GAINS SHOWN BY THE ASSESSEE IS CONCERNED, T HE LD. CIT(A) GAVE PART RELIEF TO THE ASSESSEE BY OBSERVING AS UN DER: THE OTHER ADDITION OF RS. 9,11,677/- WAS ON ACCOUN T OF THE WORKING OF THE CAPITAL GAINS SHOWN BY THE ASSESSING OFFICER. THE ADDITIONS RESULTING IN THIS FIGURE OF RS. 9,11,677/- INCLUDED: 1. BROKERAGES OF RS. 2 LAKHS WHICH WAS IN FACT PAYMENT FOR CONSTRUCTION OF BOUNDARY WALL. 2. COST INFLATION INDEX TAKEN BY THE ASSESSING OFFICER AT RS. 43,03,138/- INSTEAD OF RS. 47,13,174/- ADOPTED BY THE APPELLANT. 3. THE ASSESSING OFFICER DISALLOWED THE COST OF CONSTRUCTION OF RS. 3,99,973/- FOR NON-SUBMISSION O F BILLS RELATING TO CONSTRUCTION. AS REGARDS THE PAYMENT OF RS. 3,99,973/- IT INCLUDE S THE FOLLOWING PAYMENTS : I. PAYMENT TO MR. RAKESH NANDA ON ACCOUNT OF BROKERAGE FOR PURCHASE OF PROPERTY RS. 1,15,000 II. REGISTRY CHARGES RS. 1,15,000 TOTAL RS. 2,30,000 THE BALANCE AMOUNT OF RS. 1,69,973/- WAS NOT SUPPOR TED BY DOCUMENTARY EVIDENCE OR PROOF DURING APPELLATE 3 ITA NO . 1366/DEL/2019 PROCEEDINGS ALSO. HENCE, DISALLOWANCE TO THE EXTEN T OF RS. 1,69,973/- IS UPHELD. 4. OTHER EXPENSES OF RS. 10,126 + RS. 2,713 = RS. 12,876 WHICH WERE DISALLOWED AS BILLS WERE NOT PROVIDED ACCORDING TO THE AO. IT WAS FOUND THAT PAYMENT OF TRANSFER DUTY, STAMP DUTY, COPYING FEE E TC. WERE COVERED IN THE AMOUNT OF RS. 12,876/- WHICH AR E SUPPORTED BY DOCUMENTARY PROOF. HENCE, NO ADDITION IS CALLED FOR. IN THE LIGHT OF THE ABOVE DISCUSSION ADDITION OF RS . 1,69,973/- IS UPHELD. THE BALANCE AMOUNT STANDS DELETED . 4. AGGRIEVED WITH SUCH ORDER OF THE CIT(A), THE ASS ESSEE IS IN APPEAL BEFORE THE TRIBUNAL BY RAISING THE FOLLOWING GROUNDS: 1. THAT THE LD. AO AS WELL AS LD. CIT(APPEAL) GRAVELY ERRED IN DISALLOWING CONSTRUCTION EXPENSES INCURRED DURING FY 2007-08 ON THE GROUND THAT THE VOUCHERS FOR THE SAME IS NOT AVAILABLE. THE ASSESSEE HAS NO T MAINTAINED SUCH VOUCHERS. 2. THAT THE LD. AO AS WELL AS LD. CIT(APPEAL) HAS FAIL ED TO APPRECIATE THE EVIDENCE CONSISTING (I) VALUATION REPORT OF M/S OBEROI & ASSOCIATES DATED 18.03.2008, (II) MCD HOUSE TAX ASSESSMENT ORDER DATED 05.09.2008, (III) CONVEYANCE DEED EXECUTED B Y DDA (IV) REGISTERED SALE DEED DATED 13.11.2013, IN SUPPORT OF THE CONSTRUCTION EXPENSES BEING RS. 2,15,220/- INCURRED ON THE SOLD PROPERTY DURING FY 2007-08. 3. THAT THE ENTIRE ASSESSMENT ORDER AS WELL AS APPEAL ORDER IS WRONG, ARBITRARY, ILLEGAL, UNJUST AGAINST THE FACT AS WELL AS AGAINST THE LAW. 5. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT PROPER OPPORTUNITY HAS NOT BEEN GIVEN TO THE ASSESSEE TO S UBSTANTIATE THE EXPENSES. HE SUBMITTED THAT GIVEN AN OPPORTUNITY T HE ASSESSEE IS IN A POSITION TO SUBSTANTIATE THE SAME WITH EVIDENC E TO THE 4 ITA NO . 1366/DEL/2019 SATISFACTION OF THE AO OR CIT(A) AS THE BENCH DEEMS IT PROPER. HE, ACCORDINGLY, SUBMITTED THAT THE ISSUE MAY BE SET AS IDE TO THE FILE OF THE AO/CIT(A) AS THE CASE MAY BE. 6. THE LD. DR ON THE OTHER HAND, HEAVILY RELIED UPO N THE ORDER OF THE CIT(A). 7. I HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY BO TH THE SIDES AND PERUSED THE ORDERS OF THE AO AND THE CIT(A). I HAVE ALSO GONE THROUGH THE PAPER BOOK FILED ON BEHALF OF THE ASSES SEE. I FIND THE AO IN THE INSTANT CASE MADE ADDITION OF RS. 9,11,67 7/- U/S 45 OF THE I.T. ACT BY RE-COMPUTING THE CAPITAL GAIN OUT O F WHICH THE LD. CIT(A) HAS GIVEN PART RELIEF TO THE ASSESSEE, THE R EASONS FOR WHICH HAVE ALREADY BEEN REPRODUCED IN THE PRECEDING PARAG RAPHS. IT IS THE SUBMISSION OF LD. COUNSEL FOR THE ASSESSEE THAT GIVEN AN OPPORTUNITY THE ASSESSEE IS IN A POSITION TO SUBSTA NTIATE THE SAME WITH EVIDENCE TO THE SATISFACTION OF THE AO. CONSI DERING THE TOTALITY AND THE FACTS OF THE CASE AND IN THE INTER EST OF JUSTICE, I DEEM IT PROPER TO RESTORE THE ISSUE TO THE FILE OF THE AO WITH A DIRECTION TO GRANT ONE MORE OPPORTUNITY TO THE ASSE SSEE TO SUBSTANTIATE HER CASE AND DECIDE THE ISSUE AS PER F ACT AND LAW. GROUNDS RAISED BY THE ASSESSEE ARE ACCORDINGLY ALLO WED FOR STATISTICAL PURPOSES. 5 ITA NO . 1366/DEL/2019 10. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 06/08/2019 SD/- (R.K. PANDA) ACCOUNTANT MEMBER DATED: 06/08/2019 *KAVITA ARORA COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT TRUE COPY ASSISTANT REGISTRAR ITAT NEW DELHI DATE OF DICTATION 05.08.2019 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 05.08.2019 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER 06.08.2019 DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P S/PS 06.08.2019 DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 06.08.2019 DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. PS/PS 06.08.2019 DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WE BSITE OF ITAT 06.08.2019 DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 06.0 8.2019 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER 6 ITA NO . 1366/DEL/2019