Smt. Sujatha Krishnan, CHENNAI V. ITO, CHENNAI

ITA 1386/CHNY/2012

• Counselvise Citation: 138621714 RSA 2012
• Duration Of Justice: 1 year(s) 3 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-09-2013
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: D
• Next Hearing Date: 23-09-2013
• Assessment Year: 2008-2009
• Appeal Filed On: 22-06-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: S DASGUPTA
• Assessee Lawyers: S SRIDHAR
• Keywords: Sale consideration of property below Jantri Value; Fair market value

Judgement Text

ITA NO.1386/MDS/2012. IN THE INCOME TAX APPELLATE TRIBUNAL BENCH D CHENNAI BEFORE SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER AN D SHRI S.S. GODARA, JUDICIAL MEMBER I.T.A. NO.1386/MDS/2012 ASST. YEAR : 2008-09 SMT. SUJATHA KRISHNAN, NO.2B, SANKARA APARTMENTS, NO.97/41, 4 TH MAIN ROAD, GANDHI NAGAR, ADYAR, CHENNAI 600 020 PAN : AMFPS7944E. (APPELLANT ) V. THE INCOME TAX OFFICER, WARD V (3), CHENNAI 600 034 (RESPONDENT) DEPARTMENT BY : SHRI S. DASGUPTA, JCIT ASSESSEE BY : SHRI S. SRIDHAR, ADVOCATE DATE OF HEARING : 23 RD SEPTEMBER, 2013 DATE OF PRONOUNCEMENT : 25 TH SEPTEMBER, 2013 O R D E R PER S.S. GODARA, JUDICIAL MEMBER : THIS APPEAL FILED BY THE ASSESSEE FOR ASSESSMENT YEAR 2008-09, IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF I NCOME TAX (APPEALS)-VIII, CHENNAI DATED 28.03.2012, PASSED IN APPEAL NO.121/1 0-11(A)-VIII, IN PROCEEDINGS UNDER SEC.143(3) OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT). ITA NO.1386/MDS/2012. 2. IN THE COURSE OF HEARING, THE ASSESSEE VEHEMENT LY ARGUES THAT THE CIT(A) HAS ERRED IN CONFIRMING THE ADDITION OF CAPI TAL GAINS AMOUNTING TO ` 8,71,981/- MADE BY THE ASSESSING OFFICER IN ASSESSM ENT ORDER DATED 30.12.2010. SHE CONTENDS THAT INSPITE OF HER PLEA B EFORE THE LOWER AUTHORITIES THAT THE FAIR MARKET VALUE OF THE PROPERTY IS LESS THAN THE GUIDELINE VALUE, NO REFERENCE WAS MADE U/S. 50C(2) OF THE ACT. ACCORDIN GLY, BY CITING CASE LAW (2010) 6 ITR (TRIB) 1 (CHENNAI) M/S. B.N. PROPERTI ES HOLDINGS P. LTD VS. ACIT, THE ASSESSEE PRAYS FOR ACCEPTANCE OF THE APPEAL. 3. THE REVENUE STRONGLY ARGUES IN FAVOUR OF THE FI NDINGS UNDER CHALLENGE IN THE ORDER OF CIT(A) CONFIRMING THE ADD ITION IN QUESTION. 4. THE ASSESSEE IS AN INDIVIDUAL. IN THE IMPUG NED ASSESSMENT YEAR, SHE HAD INCOME FROM HOUSE PROPERTY, CAPITAL GAINS, OTHER SOURCE AND BUSINESS. ON 14.8.2008, SHE HAD FILED HER RETURN DECLARING TOTAL INCOME OF ` 2,44,804/-, WHICH WAS SUMMARILY PROCESSED ON 10.02.2010. 5. IN THE COURSE OF SCRUTINY THE ASSESSING OFFIC ER NOTICED THAT ON 08.02.2008, THE ASSESSEE HAD SOLD HER PROPERTY ALO NGWITH HER HUSBAND HAVING SHARE EACH, FOR ` 1,02,00,000/-; WHEREAS THE GUIDELINE VALUE OF THE SAME AS ITA NO.1386/MDS/2012. STATED IN THE SALE DEED WAS ` 1,19,49,400/-. THE STAMP AMOUNT HAD BEEN PAID AS PER THE GUIDELINE VALUE. ON BEING PUT UP TO NOTICE , THE ASSESSEE JUSTIFIED THE SALE PRICE OF ` 1,02,00,000/- INSTEAD OF GUIDELINE VALUE TO SLUMP I N REAL ESTATE, AND DILAPIDATED STATE OF THE BUILDING. SHE ALSO SUBMITT ED TO HAVE DEPOSITED AN AMOUNT OF ` 36,50,000/- IN CAPITAL GAINS ACCOUNT SCHEME. AS WE NOTICE FROM THE ASSESSMENT ORDER DATED 30.12.2010, THE SAID PLEA OF THE ASSESSEE COULD NOT CONVINCE THE ASSESSING OFFICER, WHO WAS OF THE OPIN ION THAT SINCE THE STAMP DUTY VALUE OF THE SAID PROPERTY WAS ` 1,19,50,522/-, THE SAME HAD TO TAKEN INTO CONSIDERATION, FOR THE PURPOSE OF COMPUTING CAPITAL GAINS AS UNDER:- SALE CONSIDERATION : 1,19,50,522/- SHARE OF THE ASSESSEE : 59,75,261/- INDEXED COST : 14,53,280/- ----------------------- 45,21,981/- DEPOSITED IN CAPITAL GAIN DEPOSIT A/C SCHEME 36,50,000/- ------------------------ CAPITAL GAIN TO BE TAXED 8,71,981/- ------------------------ 6. AGGRIEVED, THE ASSESSEE PREFERRED AN APPEAL. ON E OF HER SPECIFIC CONTENTION; INTER ALIA, BEFORE THE CIT(A) WAS THAT DESPITE HER REQUEST, NO REFERENCE HAS BEEN MADE TO THE VALUATION OFFICER FO R DETERMINING THE FAIR MARKET VALUE UNDER SECTION 50C(2) OF THE ACT. ON THIS, CI T(A) SOUGHT THE ASSESSING OFFICERS RESPONSE. IT IS TO BE SEEN FROM THE ORDER OF THE CIT(A) CONFIRMING THE ITA NO.1386/MDS/2012. ADDITION UNDER CHALLENGE THAT STILL THE MATTER WAS NOT REFERRED TO THE VALUATION OFFICER. THEREFORE, THE ASSESSEE IS IN APPEAL. 7. WE HAVE HEARD BOTH PARTIES AND PERUSED THE CASE FILE. THE STRIFE BETWEEN THE PARTIES IS ABOUT AN ADDITION OF CAPITAL GAIN OF ` 8,71,981/-(SUPRA). THERE IS HARDLY ANY DISPUTE ON FACTS THAT DESPITE S PECIFIC PLEA RAISED BY THE ASSESSEE QUA FAIR MARKET VALUE TO BE LESS THAN THE GUIDELINE VALUE, NEITHER THE ASSESSING OFFICER NOR THE CIT(A) MADE REFERENCE UND ER SECTION 50C(2) OF THE ACT TO THE VALUATION OFFICER SO AS TO FIND OUT THE MARK ET VALUE OF THE PROPERTY SOLD. WE REITERATE THE INTERPRETATION OF SECTION 50C(2) M ADE BY THE DECISION OF THE TRIBUNAL (SUPRA) HOLDING THAT AN ASSESSEE IS ENT ITLED TO GET THE MATTER REFERRED TO THE DEPARTMENTAL VALUATION OFFICER. THEREFORE, IN PRINCIPLE, THE INACTION ON PART OF THE LOWER AUTHORITIES IN NOT MAKING REFEREN CE CANNOT BE CONCURRED WITH. AT THE SAME TIME, WE DEEM IT APPROPRIATE IN THE LA RGER INTEREST OF JUSTICE THAT INSTEAD OF REMITTING THE CASE BACK TO THE ASSESSING OFFICER TO PROCEED AFRESH UNDER SECTION 50C(2) AT THIS BELATED STAGE, IT WOUL D BE JUST AND PROPER IN CASE THE FAIR MARKET VALUE OF THE PROPERTY SOLD IS TAKEN AS THE AVERAGE OF STAMP VALUE OF ` 1,19,50,522/- AND ACTUAL SALE VALUE OF ` 1,02,00,000/- COMING TO ` 1,10,75,261/-. SO, WE EXERCISE OUR JURISDICTION UN DER SECTION 254(1) OF THE ACT, AND COMPUTE OURSELVES CAPITAL GAINS AS UNDER:- ITA NO.1386/MDS/2012. SALE CONSIDERATION : 1,10,75,261/- SHARE OF THE ASSESSEE : 55,37,630/- INDEX COST : 14,53,280/- ----------------- 40,84,350/- DEPOSITED IN CAPITAL GAIN ACCOUNT SCHEME : 36,50,000/- ---------------- 4,34,350/- ---------------- IN THIS MANNER, WE UPHOLD IMPUGNED ADDITION TO THE EXTENT OF ` 4,34,350/- ONLY. 8. ACCORDINGLY, THE APPEAL IS PARTLY ALLOWED. ORDER PRONOUNCED ON WEDNESDAY, THE 25 TH DAY OF SEPTEMBER 2013, AT CHENNAI. SD/- SD/- ( ABRAHAM P. GEORGE ) (S.S.GODARA) ACCOUNTANT MEMBER JUDICIAL MEMBER PLACE: CHENNAI, DATED : 25.09.2013 KV COPY TO: APPELLANT / RESPONDENT/ CIT(A) CHENNAI/ CIT, CHENNAI/ D.R. / GUARD FILE. ITA NO.1386/MDS/2012.