JHARNA KAUL, Jaipur V. ITO, Jaipur

ITA 141/JPR/2014

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 5377 (ITAT-JAIPUR)
• Duration Of Justice: 2 year(s) 2 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-04-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 26-02-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJ MEHRA
• Assessee Lawyers: OJAS SETHI
• Keywords: Capital asset

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES SMC, JAIPUR JH VKJ-IH-RKSYKUH] U;KF;D LNL; DS LE{K BEFORE: SHRI R.P. TOLANI, JUDICIAL MEMBER VK;DJ VIHY LA- @ ITA NO. 141/JP/2014 FU/KZKJ.K O'K Z @ ASSESSMENT YEAR : 2009-10 JHARNA KAUL, A-14, MALVIYA NAGAR, JAIPUR. CUKE VS. ITO, WARD 6(1), JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ L A-@ PAN/GIR NO.: ABIPK 8125 F VIHYKFKHZ @ APPELLANT IZR;FKHZ @ RESPONDENT FU/KZKFJRH DH VKSJ LS @ ASSESSEE BY : SHRI OJAS SETHI (CA) JKTLO DH VKSJ LS @ REVENUE BY : SHRI RAJ MEHRA (JCIT) LQUOKBZ DH RKJH[ K@ DATE OF HEARING : 04/02/2016 MN?KKS'K .KK DH RKJH[ K @ DATE OF PRONOUNCEMENT : 27/04/2016 VKNS'K @ ORDER PER: R.P. TOLANI, J.M. THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER DATED 20/12/2013 PASSED BY THE LEARNED CIT(A)-II, JAIPUR FOR A.Y. 2009-10. THE EFFECTIVE GROUND IS AS UNDER:- ON APPRECIATION OF THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD CIT(A)-II HAS ERRED IN CONFIRMING T HE ITA 141/JP/2014_ JHARNA KAUL VS ITO 2 ACTION OF THE LD ASSESSING OFFICER IN MAKING ADDITI ON OF RS. 1,73,955/- UNDER THE HEAD LONG TERM CAPITAL GAINS. THE ACTION OF THE LD CIT(A)-II IS CONTRARY TO THE FACTS, RECORDS, CIRCUMSTANCES OF THE CASE AND LAW AND DESERVES TO BE DELETED. 2. THE CONTROVERSY IN QUESTION IS THAT THE ASSESSEE SOLD AN IMMOVABLE PROPERTY SITUATED AT GURGAON. THE PLOT WAS ALLOTTED BY HUDA ON 22/1/1987 AND THE POSSESSION THEREOF WAS GIV EN ON 06/09/2000. THE ASSESSEE HAD PAID AMOUNT AT THE TIM E OF ALLOTMENT OF PLOT WHILE WORKING OUT THE INDEXED COST OF ACQUIS ITION, THE ASSESSEE CLAIMED INDEXATION ON THE PAYMENT MADE FOR PURCHASE OF PLOT W.E.F. F.Y. 1986-87. THE LD ASSESSING OFFICER, HOWEVER, WAS OF THE VIEW THAT SINCE POSSESSION OF PLOT WAS GIVEN ON 06/9/2000, THE REFORE. THE INDEXATION WAS TO BE ALLOWED FROM F.Y. 2000-01. ACCOR DINGLY, THE ASSESSING OFFICER REDUCED INDEXED COST OF ACQUISITI ON RESULTING LONG TERM CAPITAL GAIN OF RS. 1,73,955/-. 3. AGGRIEVED, THE ASSESSEE PREFERRED FIRST APPEAL WH ERE THE ASSESSEE RELIED ON THE DECISION IN THE CASE OF CIT V S VV MODY (KAR) 218 CIT VS DA IRANI (BOM) 234 ITR 850., MANGLA DILIP SABLE VS JCIT (ITAT PUNE) 104 ITD 204. ITAT JAIPUR BENCH DECISION I N THE CASE OF ITO VS SHRI LILO RAMCHANDANI ITA NO. 1148/JP/2010 (C O NO. ITA 141/JP/2014_ JHARNA KAUL VS ITO 3 97/JP/2010) ORDER DATED 11/2/2011. THE LD CIT(A), THO UGH HELD THAT TILL POSSESSION WAS GIVEN, THE LAND IN QUESTION WAS N OT AN ASSET BUT THE ALLOTMENT AND MONEYS PAID THERE FOR AMOUNTS TO RIGHT TO ACQUIRE THE CAPITAL ASSET, THEREFORE, DENIED THE INDEXATION OF THIS ALLOTMENT AMOUNT CONFIRMED THE ORDER OF THE ASSESSING OFFICER . 4. THE LD. COUNSEL FOR THE ASSESSEE CONTENDS THAT TH E HONBLE JAIPUR ITAT BENCH IN THE CASE OF LILO RAMCHANDANI (S UPRA) IS IDENTICAL TO THE FACTS OF THE CASE OF THE ASSESSEE. FURTHER R ELIANCE IS PLACED ON THE DECISION IN THE CASE OF M.S MADHU KAUL VS CIT, C HANDIGARH (2014) 43 TAXMANN.COM 417, VINOD KUMAR JAIN VS CIT (2012) 3 44 ITR 0501, ITAT DELHI BENCH IN THE CASE OF PRAVEEN GUPTA VS ACI T, RANGE-16, NEW DELHI ITA NO. 2558/DEL/2010 AND JITENDRA MOHAN V S. ITO, WARD 28(2) NEW DELHI (2007) 11 SOT 594. 5. THE LD DR, ON THE OTHER HAND, SUPPORTED THE ORDER OF THE LOWER AUTHORITIES. 6. I HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE P ARTIES AND PERUSED THE MATERIAL AVAILABLE ON THE RECORD. IT IS SETTLED LAW THAT EVEN THE RIGHT TO ACQUIRE A PROPERTY I.E. ALLOTMENT BY HUDA ITSELF BY A CAPITAL RIGHT, WHICH GETS CONVERTED INTO THE POSSESS ION AFTER COMPLETION OF RELEVANT FORMALITIES. THE LD CIT(A) HI MSELF HAS ACCEPTED ITA 141/JP/2014_ JHARNA KAUL VS ITO 4 THE FACT THAT THE RIGHT OF OWNERSHIP IS ALSO A CAPIT AL ASSET, THIS ITSELF RESOLVES DISPUTE IN FAVOUR OF THE ASSESSEE. CONSEQU ENTLY, THE RIGHT OF POSSESSION ITSELF IS BECOMES RIGHT OF POSSESSION WHE N THE CONDITIONS ARE FULFILLED; AND BOTH ARE CAPITAL ASSETS. THE PAYM ENT FOR ALLOTMENT WAS MADE SUBJECT TO COMPLIANCE OF HUDA REQUIREMENTS AND FURTHER PAYMENT BY THE ASSESSEE. THUS THE ALLOTMENT PAYMENT WAS MADE TOWARDS PURCHASE OF PLOT ON WHICH THE PROPERTY WAS CO NSTRUCTED AND SAME IS ELIGIBLE FOR INDEXATION BEING A RIGHT IN TH E NATURE OF CAPITAL ASSET. IN THE ENTIRETY OF THE FACTS AND CIRCUMSTANC ES, RELYING ON THE CASE LAWS IN THE CASE OF LILO RAMCHANDANI (SUPRA) AN D OTHER CASES CITED ABOVE THE IMPUGNED ADDITION MADE ON INDEXATIO N OF LONG TERM CAPITAL GAINS IS DELETED. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. ORDER PRONOUNCED IN THE OPEN COURT ON 27/04/2016. SD/- VKJ-IH-RKSYKUH (R.P.TOLANI) U;KF;D LNL;@ JUDICIAL MEMBER TK;IQJ @ JAIPUR FNUKAD @ DATED:- 27 TH APRIL, 2015 *RANJAN VKNS'K DH IZFRFYFI VXZSFKR @ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ @ THE APPELLANT- SMT. JHARNA KAUL, JAIPUR. ITA 141/JP/2014_ JHARNA KAUL VS ITO 5 2. IZR;FKHZ @ THE RESPONDENT- THE ITO, WARD 6(1), JAIPUR. 3. VK;DJ VK;QDR @ CIT 4. VK;DJ VK;QDR @ CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ @ DR, ITAT, JAIPUR 6. XKMZ QKBZY @ GUARD FILE (ITA NO. 141/JP/2014) VKNS'KKUQLKJ @ BY ORDER, LGK;D IATHDKJ @ ASST. REGISTRAR