ITO, CHENNAI V. Nalini Mahadevan Kumaran, CHENNAI

ITA 1421/CHNY/2017

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 6375 (ITAT-CHENNAI)
• Duration Of Justice: 2 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-08-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2013-2014
• Appeal Filed On: 02-06-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N MADHAVAN
• Assessee Lawyers: S RAGHUNATHAN
• Keywords: Cost of acquisition

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, CHENNAI . . . , , ' # BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI S. JAYARAMAN, ACCOUNTANT MEMBER ./ ITA NO.1421/MDS/2017 & '& / ASSESSMENT YEAR : 2013-14 THE INCOME TAX OFFICER, INTERNATIONAL TAXATION WARD 1(2), CHENNAI - 600 006. V. SMT. NALINI MAHADEVAN KUMARAN, OLD NO.68B, NEW NO.46, FIRST AVENUE, INDIRA NAGAR, ADYAR, CHENNAI - 600 020. PAN : CQHPK 0155 K ()*/ APPELLANT) (+,)*/ RESPONDENT) )* - . / APPELLANT BY : SHRI N. MADHAVAN, JCIT +,)* - . / RESPONDENT BY : SHRI S. RAGHUNATHAN, CA ./ ITA NO.1424/MDS/2017 & '& / ASSESSMENT YEAR : 2013-14 THE INCOME TAX OFFICER, INTERNATIONAL TAXATION WARD 2(2), CHENNAI - 600 006. V. SHRI SUNIL PHILIP STEPHEN, NO.9-A, ARULAGAM, BISHIP WALLERS AVENUE EAST, MYLAPORE, CHENNAI - 600 004. PAN : AACPS 3962 P ()*/ APPELLANT) (+,)*/ RESPONDENT) )* - . / APPELLANT BY : SHRI N. MADHAVAN, JCIT +,)* - . / RESPONDENT BY : SHRI PRATAPKARAN PAUL, CA 2 I.T.A. NO.1421/MDS/17 I.T.A. NO.1424/MDS/17 I.T.A. NO.1425/MDS/17 ./ ITA NO.1425/MDS/2017 & '& / ASSESSMENT YEAR : 2014-15 THE INCOME TAX OFFICER, INTERNATIONAL TAXATION WARD 2(2), CHENNAI - 600 006. V. SHRI BHASKARAN SUNNY JOHN GEORGE, 1-D, ASHREYA, 4 TH SEAWARD ROAD, VALMIKI NAGAR, THIRUVANMIYUR, CHENNAI - 600 041. PAN : DKXPS 9698 C ()*/ APPELLANT) (+,)*/ RESPONDENT) )* - . / APPELLANT BY : SHRI N. MADHAVAN, JCIT +,)* - . / RESPONDENT BY : SHRI PRATAPKARAN PAUL, CA / - 0' / DATE OF HEARING : 17.08.2017 12' - 0' / DATE OF PRONOUNCEMENT : 23.08.2017 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER: ALL THE THREE APPEALS OF THE INDEPENDENT ASSESSEE S ARE DIRECTED AGAINST THE RESPECTIVE ORDERS OF THE COMMI SSIONER OF INCOME TAX (APPEALS) -16, CHENNAI. SINCE COMMON IS SUE ARISES FOR CONSIDERATION IN ALL THE THREE APPEALS, WE HEAR D THESE THREE APPEALS TOGETHER AND DISPOSING OF THE SAME BY THIS COMMON ORDER. 2. THE ONLY ISSUE ARISES FOR CONSIDERATION IS COMPU TATION OF CAPITAL GAIN. 3 I.T.A. NO.1421/MDS/17 I.T.A. NO.1424/MDS/17 I.T.A. NO.1425/MDS/17 3. SHRI N. MADHAVAN, THE LD. DEPARTMENTAL REPRESENT ATIVE, SUBMITTED THAT ALL THE THREE ASSESSEES INHERITED PR OPERTY FROM THE RESPECTIVE PARENTS. THE ASSESSING OFFICER FOR THE PURPOSE OF CAPITAL GAIN, COMPUTED THE INDEX COST OF ACQUISITION FROM T HE YEAR IN WHICH THE RESPECTIVE ASSESSEE INHERITED THE PROPERTY. AC CORDING TO THE LD. D.R., UNDER THE PROVISIONS OF INCOME-TAX ACT, INDEX COST OF ACQUISITION HAS TO BE COMPUTED FROM THE YEAR IN WHI CH THE ASSESSEE BECAME THE OWNER. 4. ON THE CONTRARY, THE LD. REPRESENTATIVES FOR THE ASSESSEES, SUBMITTED THAT THE CIT(APPEALS) BY PLACING RELIANCE ON THE JUDGMENT OF BOMBAY HIGH COURT IN CIT V. MANJULA J. SHAH (201 3) 355 ITR 474 HELD THAT FOR THE PURPOSE OF COMPUTING CAPITAL GAIN, INDEX COST OF ACQUISITION HAS TO BE COMPUTED WITH REFERENCE TO ORIGINAL OWNER WHO ACQUIRED THE PROPERTY AND NOT THE LEGAL HEIR WH O INHERITED THE PROPERTY. ACCORDING TO THE LD. REPRESENTATIVES, TH E PROPERTY WAS FIRST HELD BY RESPECTIVE PARENTS ON ACQUISITION. O N THEIR DEATH, THE ASSESSEE INHERITED THE PROPERTY BY OPERATION OF LAW . THEREFORE, ACCORDING TO THE LD. REPRESENTATIVES, BY RIGHTLY PL ACING RELIANCE ON THE JUDGMENT OF BOMBAY HIGH COURT AND OTHER DECISIO NS OF THE TRIBUNAL, THE CIT(APPEALS) DIRECTED THE ASSESSING O FFICER TO 4 I.T.A. NO.1421/MDS/17 I.T.A. NO.1424/MDS/17 I.T.A. NO.1425/MDS/17 COMPUTE THE INDEX COST OF ACQUISITION FROM THE YEAR IN WHICH THE ORIGINAL OWNER ACQUIRED THE PROPERTY. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. IT IS NOT IN DISPUTE THAT ALL THE THREE ASSESSEES INHERITED THE PROPERTY FROM THEIR RESPECTIVE PARENTS BY OPERATION OF LAW. THE QUESTI ON ARISES FOR CONSIDERATION IS WHEN THE PROPERTY WAS INHERITED BY RESPECTIVE PERSONS FROM THE PARENTS BY OPERATION OF LAW, WHETH ER THE INDEX COST OF ACQUISITION HAS TO BE COMPUTED IN THE YEAR IN WHICH THEY INHERITED THE PROPERTY OR THE YEAR IN WHICH THE ORI GINAL OWNER HELD THE PROPERTY. THIS ISSUE WAS DECIDED BY BOMBAY HIG H COURT IN MANJULA J. SHAH (SUPRA). THE BOMBAY HIGH COURT CAT EGORICALLY HELD THAT THE YEAR IN WHICH THE ORIGINAL OWNER ACQUIRED THE PROPERTY HAS TO BE TAKEN FOR INDEX COST OF ACQUISITION. IN FACT , THE CIT(APPEALS) HAS PLACED HIS RELIANCE ON THIS JUDGMENT OF BOMBAY HIGH COURT. THEREFORE, THIS TRIBUNAL DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDER OF THE LOWER AUTHORITY AND ACCORDINGLY THE SA ME IS CONFIRMED. 6. IN THE RESULT, ALL THE THREE APPEALS FILED BY TH E REVENUE ARE DISMISSED. 5 I.T.A. NO.1421/MDS/17 I.T.A. NO.1424/MDS/17 I.T.A. NO.1425/MDS/17 ORDER PRONOUNCED ON 23 RD AUGUST, 2017 AT CHENNAI. SD/- SD/- ( ) ( . . . ) (S. JAYARAMAN) (N.R.S. GANESAN) ' / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 4 /DATED, THE 23 RD AUGUST, 2017. KRI. - +056 76'0 /COPY TO: 1. )* /APPELLANT 2. +,)* /RESPONDENT 3. / 80 () /CIT(A)-16 4. THE CIT(IT), CHENNAI 5. 69 +0 /DR 6. :& ; /GF.