K.S.Senthil Kumar, CHENNAI V. DCIT, CHENNAI

ITA 1374/CHNY/2016

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 6572 (ITAT-CHENNAI)
• Duration Of Justice: 2 year(s) 11 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-04-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 08-06-2017
• Assessment Year: 2011-2012
• Appeal Filed On: 19-05-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: B SAGADEVAN
• Keywords: Fair market value; Set aside
• Section: 54F; 131

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, CHENNAI . . . , . !'# ! , % !& BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ./ ITA NO.1374/CHNY/2016 ( )( / ASSESSMENT YEAR : 2011-12 SHRI K.S. SENTHIL KUMAR, FLAT NO.2C, OLD NO.26, NEW NO.51, RAMANIYAM KASTURI APARTMENTS, VIJAYARAGHAVAN ROAD, T. NAGAR, CHENNAI - 600 017. PAN : AMXPS 9067 L V. THE DEPUTY COMMISSIONER OF INCOME TAX, NON-CORPORATE CIRCLE -2, CHENNAI - 600 034. (+,/ APPELLANT) (-.+,/ RESPONDENT) +, / 0 / APPELLANT BY : SH. SAROJ KUMAR PARIDA, ADVOCATE -.+, / 0 / RESPONDENT BY : SHRI B. SAGADEVAN, JCIT 1 / 2% / DATE OF HEARING : 01.04.2019 3') / 2% / DATE OF PRONOUNCEMENT : 30.04.2019 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER : THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST T HE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) -2, CHENNA I, DATED 01.03.2016 AND PERTAINS TO ASSESSMENT YEAR 2011-12. 2 I.T.A. NO.1374/CHNY/16 2. THE FIRST ISSUE ARISES FOR CONSIDERATION IS DETE RMINATION OF FAIR MARKET VALUE AS ON 01.04.1981 FOR COMPUTING CAPITAL GAINS. 3. SH. SAROJ KUMAR PARIDA, THE LD.COUNSEL FOR THE A SSESSEE, SUBMITTED THAT THE ASSESSEE ADOPTED 33 LAKHS PER GROUND AS ON 01.04.1981. HOWEVER, THE ASSESSING OFFICER HAS TAK EN FAIR MARKET VALUE AS ON 01.04.1981 AT 12,000/- PER GROUND ON THE BASIS OF THE GUIDELINE VALUE. PLACING RELIANCE ON THE JUDGMENT OF MADRAS HIGH COURT IN CIT V. JVK RAO (131 TAXMAN 65), THE LD.COU NSEL SUBMITTED THAT FAIR MARKET VALUE DEPENDS UPON VARIO US FACTORS SUCH AS LOCATION OF PROPERTY, PROXIMITY OF THE AREA, COM PARATIVE SALE INSTANCES, ANNUAL RENTAL VALUE, ETC. THE ASSESSING OFFICER WITHOUT ADOPTING ALL THESE FACTORS, ACCORDING TO THE LD. CO UNSEL, SIMPLY TAKEN THE GUIDELINE VALUE AS MARKET VALUE. 4. ON THE CONTRARY, SHRI B. SAGADEVAN, THE LD. DEPA RTMENTAL REPRESENTATIVE, SUBMITTED THAT THE ASSESSEE FILED A CHARTERED ENGINEERS VALUATION VALUING THE PROPERTY BACKWARDS FROM THE SALE VALUE OF 2.9 CRORES AS PER THE SALE DEED DATED 26.08.2010. ACCORDING TO THE LD. D.R., THE ASSESSEE HAS NOT TAK EN ANY COMPARATIVE SALE INSTANCES DURING THE RELEVANT PERI OD. THE ONLY DATA AVAILABLE BEFORE THE ASSESSING OFFICER IS THE GUIDELINE VALUE 3 I.T.A. NO.1374/CHNY/16 RECEIVED FROM SUB-REGISTRAR. THEREFORE, ACCORDING TO THE LD. D.R., THE ASSESSING OFFICER HAS ADOPTED THE GUIDELINE VAL UE AT 12,000/- PER GROUND. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. FAIR MARKET VALUE IS NOT A CONSTANT FIGURE. IT MAY FLUCTUATE D EPENDING UPON VARIOUS FACTORS. THE GUIDELINE VALUE MAY VARY DEPE NDING UPON LOCATION OF THE PROPERTY, AREA OF THE PROPERTY, POT ENTIAL FOR FUTURE DEVELOPMENT, INFRASTRUCTURE FACILITY AROUND THE PRO PERTY, ANNUAL RENTAL VALUE THAT MAY FETCH IN CASE THE PROPERTY WA S LET OUT. GUIDELINE VALUE IS ALSO ONE OF THE FACTORS WHICH NE EDS TO BE TAKEN INTO CONSIDERATION. THE GUIDELINE VALUE IS FOR GU IDING THE SUB- REGISTRAR TO ASCERTAIN MARKET VALUE FOR THE PURPOSE OF COLLECTING STAMP DUTY. THIS TRIBUNAL IS OF THE CONSIDERED OPI NION THAT GUIDELINE VALUE MAY NOT ALWAYS REPRESENT THE MARKET VALUE OF THE PROPERTY. THEREFORE, THE ASSESSING OFFICER HAS TO CONSIDER AL L THESE FACTORS BEFORE DETERMINING THE VALUE AS ON 01.04.1981. SIN CE THESE FACTORS WERE NOT CONSIDERED, THIS TRIBUNAL IS OF THE CONSID ERED OPINION THAT THE MATTER NEEDS TO BE RE-EXAMINED BY THE ASSESSING OFFICER. ACCORDINGLY, ORDERS OF BOTH THE AUTHORITIES BELOW A RE SET ASIDE AND 4 I.T.A. NO.1374/CHNY/16 DETERMINATION OF FAIR MARKET VALUE AS ON 01.04.1981 IS REMITTED BACK TO THE FILE OF THE ASSESSING OFFICER. THE ASSESSIN G OFFICER SHALL RE- EXAMINE THE MATTER AND BRING ON RECORD THE VARIOUS FACTORS REFERRED ABOVE AND THEREAFTER DECIDE THE ISSUE AFRESH IN ACC ORDANCE WITH LAW, AFTER GIVING A REASONABLE OPPORTUNITY TO THE A SSESSEE. 6. THE NEXT ISSUE ARISES FOR CONSIDERATION IS DEDUC TION CLAIMED BY THE ASSESSEE UNDER SECTION 54F OF THE INCOME-TAX ACT, 1961 (IN SHORT 'THE ACT'). 7. SH. SAROJ KUMAR PARIDA, THE LD.COUNSEL FOR THE A SSESSEE, SUBMITTED THAT THE ASSESSEE CLAIMED DEDUCTION UNDER SECTION 54F OF THE ACT TO THE EXTENT OF 37,53,980/-. HOWEVER, THE ASSESSING OFFICER ALLOWED THE CLAIM TO THE EXTENT OF 33,78,260/- AS AGAINST THE CLAIM OF 37,53,980/-. THE ASSESSING OFFICER DISALLOWED THE DIFFERENTIAL AMOUNT OF 3,75,720/-. ACCORDING TO THE LD. COUNSEL, THE ENTIRE CLAIM OUGHT TO HAVE BEEN ALLOWED. 8. ON THE CONTRARY, SHRI B. SAGADEVAN, THE LD. DEPA RTMENTAL REPRESENTATIVE, SUBMITTED THAT WHAT WAS INVESTED UP TO THE DATE OF FILING THE RETURN OF INCOME UNDER SECTION 139(1) OF THE ACT WAS ALLOWED BY THE ASSESSING OFFICER. ACCORDING TO THE LD. D.R., THE 5 I.T.A. NO.1374/CHNY/16 BALANCE AMOUNT, WHICH WAS NOT UTILISED IN PURCHASIN G NEW ASSET BEFORE THE DUE DATE FOR FILING THE RETURN OF INCOME UNDER SECTION 131 OF THE ACT, WAS NOT ALLOWED. THE LD. D.R. PLACED H IS RELIANCE ON THE DECISION OF COCHIN BENCH OF THIS TRIBUNAL IN ITO V. SMT. ROSAMMA KORAH (2014) 45 TAXMANN.COM 153 AND ON THE JUDGMENT OF KERALA HIGH COURT IN CIT V. V.R. DESAI (2011) 197 TAXMAN 5 2, COPIES OF BOTH THE DECISIONS ARE FILED BEFORE THIS TRIBUNAL. 9. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. SUB-SECTION (4) OF SECTION 54F OF THE ACT CLEARLY SAYS THAT THE AMO UNT UTILISED FOR THE PURPOSE OF ACQUIRING NEW ASSET BEFORE THE DATE FOR FILING THE RETURN OF INCOME HAS TO BE ALLOWED. IF ANY PART OF CAPITA L GAIN COULD NOT BE UTILISED, THE SAME HAS TO BE DEPOSITED IN THE DESIG NATED ACCOUNT. IN THIS CASE, WHAT WAS UTILISED BEFORE THE DATE OF FIL ING THE RETURN OF INCOME UNDER SECTION 139(1) OF THE ACT IS ONLY 33,78,260/- AND IT IS NOT THE CASE OF THE ASSESSEE THAT ANY AMOUNT WAS DE POSITED IN THE DESIGNATED BANK ACCOUNT FOR THE PURPOSE OF CLAIMING EXEMPTION / DEDUCTION UNDER SECTION 54F OF THE ACT. IN VIEW OF THE ABOVE, THIS TRIBUNAL DO NOT FIND ANY REASON TO INTERFERE WITH T HE ORDER OF THE LOWER AUTHORITY AND ACCORDINGLY THE SAME IS CONFIRM ED. 6 I.T.A. NO.1374/CHNY/16 10. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE COURT ON 30 TH APRIL, 2019 AT CHENNAI. SD/- SD/- (. !'# ! ) ( . . . ) (A. MOHAN ALANKAMONY) (N.R.S. GANESA N) % / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 5 /DATED, THE 30 TH APRIL, 2019. KRI. / -267 87)2 /COPY TO: 1. +, /APPELLANT 2. -.+, /RESPONDENT 3. 1 92 () /CIT(A)-2, CHENNAI-34 4. PRINCIPAL CIT-1, CHENNAI 5. 7: -2 /DR 6. ;( < /GF.