Shri Pramod Somnath Agrawal, Ahmedabad V. The ITO, Ward-3(3)(4), Ahmedabad

ITA 1404/AHD/2018

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 3409 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 9 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-03-2020
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2013-2014
• Appeal Filed On: 25-05-2018
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SANTOSH KANANI
• Keywords: Sale consideration of property below Jantri Value; Cost of acquisition

Judgement Text

, . . , IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, AHMEDABAD BEFORE SHRI SANDEEP GOSAIN, JUDICIAL MEMBER AND SHRI AMARJIT SINGH, ACCOUNTANT MEMBER ./I.T.A. NO. 1404/AHD/2018 ( / ASSESSMENT YEAR : 2013-14) SHRI PRAMOD SOMNATH AGRAWAL B-402, RATNAKAR 3 NR.KALA DARSHAN, ANANDNAGAR ROAD SATELLITE, AHMEDABAD-380 015 / VS. THE ITO WARD-3(3)(4) ./ ./PAN/GIR NO. : AATPA 1347 F ( /APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY : -NONE- / RESPONDENT BY : SHRI SANTOSH KANANI, SR.DR /DATE OF HEARING 05/03/2020 / DATE OF PRONOUNCEMENT 05 / 0 3 /20 20 / O R D E R PER SHRI SANDEEP GOSAIN, JUDICIAL MEMBER : THE CAPTIONED APPEAL HAS BEEN FILED AT THE INSTAN CE OF THE ASSESSEE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TA X (APPEALS)3, AHMEDABAD [CIT(A) IN SHORT] VIDE APPEAL NO.CIT(A)-3 /WD.3(3)(4)/117/16-17 DATED 03/05/2018 ARISING IN THE ASSESSMENT ORDER PASSED UNDER S.143(3) OF THE INCOME TAX ACT, 1961(HEREINAFTER REFERRED TO AS 'THE ACT') DATED 31/03/2016 RELEVANT TO ASSESSMENT YEAR (AY) 2013-14 . 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL:- ITA NO.1404/AHD/2018 SHRI PRAMOD SOMNATH AGRAWAL VS. ITO ASST.YEAR 2013-14 - 2 - 1. THE LD.CIT(APPEALS)-3 AHMEDABAD HAS ERRED IN LAW AND ON FACTS IN PASSING APPELLATE ORDER DATED 03/05/2018 FOR A.Y. 2013-14 I N THE CASE OF APPELLANT BY CONFIRMING DISALLOWANCE MADE BY THE A.O. 2. THE LD.CIT APPEALS ERRED IN LAW AND ON FACTS IN CON FIRMING THE ADDITION MADE BY THE A.O. ON ACCOUNT OF LONG TERM CAPITAL GAIN OF RS .28,18,267/- U/S.54 OF THE ACT ON THE BASIS OF REPORT OF DVO. 3. TODAY, THE CASE WAS FIXED FOR HEARING BUT NONE A PPEARED ON BEHALF OF ASSESSEE NOR ANY ADJOURNMENT APPLICATION HAS BEEN FILED ON RECORD. 4. FROM THE RECORDS, WE OBSERVE THAT REQUIRED NOTIC E WAS SENT TO THE ASSESSEE BY REGISTERED POST WHICH WAS DULY SERVED U PON THE ASSESSEE AND IN THIS RESPECT ACKNOWLEDGMENT FROM THE DEPARTMENT OF POSTS HAS ALREADY BEEN PLACED ON RECORD WHICH SHOWS THAT EVEN IN SPITE OF SERVICE OF NOTICE, THE ASSESSEE OR HIS REPRESENTATIVE HAS NOT COME BEFORE THIS COURT FOR ATTENDING THE HEARING WHICH GOES TO SHOW THAT ASSESSEE IS NOT INTERESTED IN PURSUING WITH HIS PRESENT APPEAL. HOWEVER, LD.DR PRESENT IN THE COURT IS READY TO THE ARGUMENTS, THEREFORE WE PROCEED TO DECIDE THE APPEA L ON MERITS EX-PARTE QUA THE ASSESSEE, AFTER HEARING THE LD.DR. 5. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE HA S FILED HIS E-RETURN OF INCOME ON 05/08/2013 DECLARING TOTAL INCOME AT RS.8 ,89,919/-. THE ASSESSEE IS ENGAGED IN THE BUSINESS OF TRADING IN HOUSEHOLD HARDWARE MATERIAL AND LTCG AND OTHER SOURCES INCOME. THE CASE WAS SELE CTED FOR SCRUTINY BY SERVING STATUTORY NOTICE AND AFTER SEEKING REPLY OF THE ASSESSEE, THE ASSESSMENT WAS FINALIZED U/S.143(3) AND MADE DISALL OWANCE BY THE ASSESSING OFFICER. ITA NO.1404/AHD/2018 SHRI PRAMOD SOMNATH AGRAWAL VS. ITO ASST.YEAR 2013-14 - 3 - 6. AGGRIEVED BY THE ORDER OF THE AO, ASSESSEE PRE FERRED APPEAL BEFORE LD.CIT(A), WHO AFTER CONSIDERING THE WRITTEN SUBMIS SIONS OF THE ASSESSEE, DISMISSED THE APPEAL FILED BY THE ASSESSEE. 7. AGGRIEVED BY THE ORDER OF THE LD.CIT(A), NOW THE ASSESSEE IS IN APPEAL BEFORE US ON THE GROUNDS MENTIONED HEREINABOVE. ALT HOUGH ASSESSEE HAS RAISED TWO GROUNDS BUT BOTH THE GROUNDS RAISED BY THE ASSESSEE ARE INTER- CONNECTED, INTER-RELATED AND RELATES TO CHALLENGING THE ORDER OF LD.CIT(A) IN CONFIRMING THE ADDITION MADE BY THE ASSESSING OFFIC ER ON ACCOUNT OF LONG TERM CAPITAL GAIN (LTCG) OF RS.28,18,267/- U/S.54 O F THE ACT. 8. WE HAVE HEARD THE LD.DR AND PERUSED THE MATERIA L PLACED ON RECORD AS WELL AS THE ORDERS PASSED BY THE REVENUE AUTHORI TIES. BEFORE WE DECIDE THIS ISSUE ON MERITS, IT IS NECESSARY TO EVALUATE T HE ORDER PASSED BY THE LD.CIT(A) WHILE DECIDING THIS GROUND. WE FIND THAT THE LD.CIT(A) REFERRED THE RATIO LAID DOWN BY THE APEX COURT IN THE CASE OF SU RAJ LAMP AND INDUSTRIES PVT.LTD. VS. STATE OF HARYANA (2012) 340 ITR 1 (SC) , IN HIS ORDER WHILE DECIDING THE ISSUE. THE LD.CIT(A) HAS DEALT WITH T HIS GROUND IN PARAGRAPH NOS.3 & 4 OF HIS ORDER, HOWEVER, THE RELEVANT PORTI ON CONTAINED IN PARAGRAPH NO.3.2 OF HIS ORDER IS REPRODUCED HEREUNDER: 3.2 DECISION: I HAVE CONSIDERED THE FACTS MENTIONED IN THE ASSES SMENT ORDER AND THE SUBMISSIONS OF THE APPELLANT CAREFULLY. THE ISS UE IS RELATING TO COMPUTATION OF LTCG ON THE SALE OF IMMOVABLE PROPERTY. THE APPELLA NT HAD CLAIMED COST OF ACQUISITION AND COST OF IMPROVEMENT WHICH APPEARED TO AO ON HIGHER SIDE, THEREFORE, THE MATTER WAS REFERRED TO DVO ON 04.03. 2016 AS PER LAW. THE DVO SUBMITTED THE REPORT DATED 31.03.2016. AS PER ASSES SMENT ORDER, THE DVO'S REPORT WAS FINALIZED BY THE DVO IN PRESENCE OF SHRI PRATIK JAIN, C.A. AND ALSO THE VALUATION ITA NO.1404/AHD/2018 SHRI PRAMOD SOMNATH AGRAWAL VS. ITO ASST.YEAR 2013-14 - 4 - REPORT OF REGISTERED VALUER SUBMITTED BY THE APPELL ANT WAS CONSIDERED IN THE PROCESS. THE AO HAS MENTIONED IN ASSESSMENT ORDER AT PAGE NO .3 THAT THE APPELLANT NEITHER HAD ANY OBJECTION BEFORE DVO NOR BEFORE AO AGAINST THE REFERENCE MADE TO THE DVO. NOW THE APPELLANT RE-SUBMITTED THAT THE INTERI OR DECORATION EXPENSES SHOULD BE ALLOWED AS PER FOLLOWING CASE LAWS: RAJAT B. MEHTA VS. ITO, INTERNATIONAL TAXATION, VAD ODARA ITA NO.19/AHD/2016 A.Y. 2011-12 SALEEM FAZELONOY VS. DCIT (2007) 108 TTJ (MUMBAI ) 894. I HAVE EXAMINED THE RATIO LAID DOWN IN ABOVE CASE L AWS AND THE ONLY COMMON POINT IS RELATING TO DEDUCTION U/S.54F. HOWEVER, THE INTE RIOR DECORATION HAS BEEN SPECIFICALLY COMMENTED BY THE DVO AS MENTIONED IN P AGE 3 OF ASSESSMENT ORDER AS UNDER: COST OF ACQUISITION BEING OF RS. 1,80,400/- RS. 54,200/- COST OF IMPROVEMENT BEING OF RS.22,62,400/- RS.11,31,200/- THE REPORT OF DVO HAS BEEN IN THE KNOWLEDGE OF THE APPELLANT AND SAME HAS BEEN CONSIDERED TO MAKE IMPUGNED ADDITION AFTER PROPER O PPORTUNITY OF BEING HEARD GIVEN TO THE APPELLANT. THE APPELLANT HAS CO-OPERATED WIT H THE ASSESSING OFFICER AND FURNISHED SUBMISSIONS DURING ASSESSMENT PROCEEDINGS AND THE PROCESS OF DVO'S REPORT WAS SIMULTANEOUSLY CONDUCTED WITH THE FULL K NOWLEDGE OF THE APPELLANT. AS A MATTER OF FACT, THE ABSOLUTE RIGHTS WERE NOT H ANDED OUT TO THE PURCHASER, THEREFORE, THE SALE IS COMPLETE AS PER RATIO IN THE CASE OF SURAJ LAMP AND INDUSTRIES PVT. LTD. VS. STATE OF HARYANA [2012] 340 ITR 1 (SC ) IS RELIED WHICH IS AS UNDER: 'IMMOVABLE PROPERTY CAN BE LEGALLY AND LAWFULLY TRA NSFERRED OR CONVEYED ONLY BY A REGISTERED DEED OF CONVEYANCE. TRANSACTIONS OF THE NATURE OF GENERAL POWER OF ATTORNEY SALES OR SALE AGREEMENTS/GENERAL POWERS OF ATTORNEY WILL TRANSFERS DO NOT CONVEY TITLE AND DO NOT AMOUNT TO TRANSFER, NOR CAN THEY BE RECOGNIZED AS VALID MODES OF TRANSFER OF IMMOVABLE PROPERTY.' THE OBJECTION TO THE JANTRI VALUATION HAS NEITHER B EEN TAKEN AT SVA LEVEL OR AT AO'S LEVEL. ALSO THE APPELLANT WAS REQUIRED TO RAISE OBJ ECTION TO THE VALUATION RATE BEFORE DVO WHILE HE WAS FINALIZING THE REPORT IN PRESENCE OF THE AR OF THE APPELLANT. THE RATIO LAID DOWN IN THE CASE LAWS RELIED BY APPELLAN T HAVE ALREADY BEEN CONSIDERED BY THE AO. THE UNDERSIGNED IS NOT HAVING ANY FRESH MAT ERIAL TO BE CONSIDERED. CONSEQUENTLY, THE ADDITION MADE ON ACCOUNT OF DVO'S REPORT AND U/S.50C OF RS.28,16,267/- IS HEREBY CONFIRMED. GROUNDS NO.1 TO 6 OF APPEAL ARE DISMISSED. ITA NO.1404/AHD/2018 SHRI PRAMOD SOMNATH AGRAWAL VS. ITO ASST.YEAR 2013-14 - 5 - 9. AFTER HAVING GONE THROUGH THE FACTS OF THE PRESE NT CASE, WE FIND THAT THE ASSESSEE MISERABLY FAILED TO EXPLAIN THE IMPUGN ED ASSESSMENT BEFORE ASSESSING OFFICER AS WELL AS CIT(A). THEREFORE, TH E ASSESSING OFFICER AS WELL AS CIT(A) DECIDED THE ORDERS AGAINST THE ASSESSEE W HILE MAKING ADDITIONS. EVEN BEFORE US, NO NEW FACTS OR CIRCUMSTANCES HAVE BEEN PLACED ON RECORD AND THE ORDERS PASSED BY THE REVENUE AUTHORITIES HA VE ALSO GONE UNREBUTTED, THEREFORE, WE FIND NO REASON TO INTERFERE INTO OR T O DEVIATE FROM SUCH FINDINGS OF THE AUTHORITIES BELOW AND WE UPHOLD THE DECISION OF THE LD.CIT(A) AND REJECT THE GROUNDS RAISED BY THE ASSESSEE. 10. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS D ISMISSED. ORDER PRONOUNCED IN THE COURT ON 05 - 03 - 2020 AT AHMEDABAD SD/- SD/- ( AMARJIT SINGH) ( SANDEEP GOSAIN) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED 05/ 03 /2020 & . . , . ' . ./ T.C. NAIR, SR. PS ! '! / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ()* + / CONCERNED CIT 4. + ( ) / THE CIT(A)-3, AHMEDABAD 5. ,-. '')* , )* , ( / DR, ITAT, AHMEDABAD 6. .01 / GUARD FILE. / BY ORDER, , ' //TRUE COPY// / (DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD