Shri Jumromal Valramal Jhamtani, Pune V. Asst.CIT,Cen.Cir. 1(2), Pune, Pune

ITA 1451/PUN/2010

• Counselvise Citation: [2012] 119 COUNSELVISE.COM (IT) 9900 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 10 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-10-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2006-2007
• Appeal Filed On: 15-12-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VINITA MENON
• Assessee Lawyers: NILESH KHANDELWAL
• Keywords: Sale consideration of property below Jantri Value; Capital asset; Opportunity of being heard; Fair market value
• Section: 50C; 37

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B, PUNE BEFORE SHRI SHAILENDRA KUMAR YADAV, JUDICIAL MEMBER AND SHRI R.K. PANDA, ACCOUNTANT MEMBER ITA NO.1451/PN/2010 (ASSESSMENT YEAR 2006-07) JUMROMAL VALRAMAL JHAMTANI, C/O. SHAH KHANDELWAL JAIN &ASSOCIATES, C.A. LEVEL 3, BUSINESS BAY, PLOT NO.84, WELLESLEY ROAD, NEAR RTO, PUNE PAN NO. AAOPJ 4423A .. APPELLANT VS. ASST. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-1(2),PUNE. .. RESPONDENT ASSESSEE BY : SRI NILESH KHANDELWAL DEPARTMENT BY : SMT. VINITA MENON DATE OF HEARING : 19 -10-2012 DATE OF PRONOUNCEMENT : 30-10-2012 ORDER PER R.K. PANDA, AM : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER DATED 12-10- 2010 OF THE CIT(A), CENTRAL, PUNE RELATING TO ASSES SMENT YEAR 2006-07. 2. GROUND OF APPEAL NO. 1 BY THE ASSESSEE READS AS UNDER : 1. ON FACTS AND CIRCUMSTANCES PREVAILING IN THE CA SE AND AS PER PROVISIONS OF THE ACT IT BE HELD THAT, THE VALUE OF CONSIDERATION SUBSTIT UTED BY THE AO IN PLACE OF SUCH VALUE REALIZED BY THE APPELLANT WITHOUT REFERRING THE MAT TER TO THE VALUATION OFFICER IN TERMS OF PROVISIONS OF SECTION 50C OF THE ACT, IS IMPROPER E RRONEOUS AND CONTRARY TO THE PROVISIONS AND SCHEME OF THE ACT. IF FURTHER BE HE LD THAT, THE VALUE CONSIDERED BY THE STAMP AUTHORITY FOR THE PURPOSE OF REGISTRATION HAS BEEN DISPUTED BY THE APPELLANT AND THE SAME SHOULD HAVE BEEN CONSIDERED BY THE AO WHILE CO NSIDERING THE ISSUE PERTAINING TO THE APPLICABILITY OF SEC.50C OF THE ACT & THE ADDIT ION MADE BY THE AO IN TERMS OF PROVISIONS OF SECTION 50C AND CONFIRMED BY THE 1 ST APPELLATE AUTHORITY IS CONTRARY TO THE PROVISIONS AND SCHEME OF THE ACT AND THE ADDITION M ADE BY THE AO AND THAT CONFIRMED BY THE 1 ST APPELLATE AUTHORITY BE DELETED. THE APPELLANT BE GRANTED JUST AND PROPER RELIEF IN THIS ASPECT. 3. FACTS OF THE CASE, IN BRIEF, ARE THAT THE AO DUR ING THE COURSE OF ASSESSMENT PROCEEDINGS NOTED THAT THE ASSESSEE HAS SOLD A PLOT OF LAND AT MOSHI. AS PER THE 2 SALE DEED THE SALE CONSIDERATION RECEIVED BY THE AS SESSEE IS RS.41,24,250/-. HOWEVER, THE MARKET VALUE OF THE SAID LAND FOR STAM P DUTY PURPOSES WAS TAKEN AT RS.68,35,500/- BY THE STAMP VALUATION AUTHORITIES. THE AO ASKED THE ASSESSEE TO EXPLAIN AS TO WHY THE FULL VALUE OF CONSIDERATION S HALL NOT BE TAKEN AT RS.68,35,500/- IN VIEW OF THE PROVISIONS OF SECTION 50C. REJECTING THE VARIOUS EXPLANATIONS GIVEN BY THE ASSESSEE THE AO TOOK THE VALUE ADOPTED BY THE STAMP DUTY VALUATION AUTHORITIES AS THE FULL VALUE OF CON SIDERATION. 3.1 IN APPEAL THE LEARNED CIT(A) UPHELD THE ACTION OF THE AO ON THE GROUND THAT THE ASSESSEE, NO WHERE IN ITS COMPUTATION OF INCOME , HAS BROUGHT OUT THE ABOVE FACTS RELATING TO THE ADOPTION/ASSESSMENT OF HIGHER VALUATION BY THE STAMP VALUATION AUTHORITY THAN THE CONSIDERATION RECEIVED BY IT. H E HAS NOT MADE ANY CLAIM IN THIS RESPECT IN ITS RETURN OF INCOME. THEREFORE, THE PR OVISIONS OF SECTION 50C(1) ARE CLEARLY APPLICABLE TO THE FACTS OF THE CASE. HE AC CORDINGLY UPHELD THE ACTION OF THE AO IN SUBSTITUTING RS.68,35,500/- AS THE FULL VALUE OF CONSIDERATION AS AGAINST RS.41,24,250/- ADOPTED BY THE ASSESSEE. AGGRIEVED WITH SUCH ORDER OF THE CIT(A) THE ASSESSEE IS IN APPEAL BEFORE US. 4. THE LEARNED COUNSEL FOR THE ASSESSEE REFERRING T O THE ORDER OF THE PUNE BENCH OF THE TRIBUNAL IN THE CASE OF ELCAB WIRES PVT. LTD . VS. ACIT VIDE ITA NO.1452/PN/2010 ORDER DATED 30-05-2012 FOR A.Y. 200 6-07 SUBMITTED THAT UNDER IDENTICAL FACTS AND CIRCUMSTANCES THE MATTER WAS RE STORED TO THE FILE OF THE AO WITH A DIRECTION TO REFER THE ISSUE TO THE VALUATION OFF ICER IN TERMS OF SECTION 50C(2) OF THE ACT AND TO DECIDE THE ISSUE AFRESH. HE ACCORDI NGLY SUBMITTED THAT SINCE THE ASSESSEE IN THE INSTANT CASE HAS EXPLAINED BEFORE T HE AO DURING THE COURSE OF ASSESSMENT PROCEEDINGS THAT THE LAND IN QUESTION WA S CLASSIFIED AS BAD OR INFERTILE BY THE AUTHORITIES IN PUNE CHINCHWAD MUNICIPAL CORP ORATION AND SINCE THERE WAS ALSO RESTRICTIONS ON ANY STRUCTURE THAT WOULD BE CO NSTRUCTED ON THIS LAND AND SINCE 3 THE ASSESSEE HAD ALSO REQUESTED THE AO TO APPOINT A VALUATION OFFICER TO ASCERTAIN THE FAIR MARKET VALUE OF THE PROPERTY, THEREFORE, T HE ISSUE SHOULD BE RESTORED TO THE FILE OF THE AO WITH A DIRECTION TO REFER THE MATTER TO THE VALUATION OFFICER FOR DETERMINING THE FAIR MARKET VALUE. THE LEARNED DR ON THE OTHER HAND HEAVILY RELIED ON THE ORDER OF THE CIT(A). 5. WE HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY B OTH THE SIDES, PERUSED THE ORDERS OF THE AUTHORITIES BELOW AND THE PAPER BOOK FILED ON BEHALF OF THE ASSESSEE. WE FIND IN RESPONSE TO THE QUERY RAISED BY THE AO A S TO WHY THE FULL VALUE OF CONSIDERATION SHALL NOT BE TAKEN AT RS.68,35,500/- THE ASSESSEE HAD MADE AN EXPLANATION WHICH THE AO HAS SUMMARISED AND HAS MEN TIONED AT PARA 4 OF THE ORDER WHICH READS AS UNDER : 4. DURING THE YEAR UNDER CONSIDERATION, THE ASSESS EE HAS SOLD A PLOT OF LAND AT MOSHI. AS PER THE SALE DEED, THE SALES CONSIDERATI ON RECEIVED BY THE ASSESSEE IS RS.41,24,450/-. HOWEVER, THE MARKET VALUE OF THE S AID LAND FOR STAMP DUTY PURPOSES IS TAKEN AT RS.68,35,500/- BY THE STAMP DUTY AUTHORITI ES. AS PER SECTION 50C OF THE I.T. ACT, 1961, WHERE THE CONSIDERATION RECEIVED OR ACCRUING AS A RESULT OF THE TRANSFER BY AN ASSESSEE OF A CAPITAL ASSET, BEING LAND OR BUILDING OR BOTH, IS LESS THAN THE VALUE ADOPTED OR ASSESSED BY ANY AUTHORITY OF A STATE GOVERNMENT (I.E. STAMP VALUATION AUTHORITY) FOR THE PURPOSE OF PAYMENT OF STAMP DUTY IN RESPECT OF SUCH TRANSFER, THE VALUE SO ADOPTED OR ASSESSED SHALL, FOR THE PURPOSE OF SECTION 48, BE DEEMED TO BE THE FULL VALUE OF THE CONSIDERATION RECEIVED OR ACCRUING AS A RESULT OF S UCH TRANSFER. THUS, THE ASSESSEE SHOULD HAVE TAKEN THE FULL VALUE OF CONSIDERATION AT RS.68 ,35,000/- INSTEAD OF RS.41,24,250/-. THE ASSESSEE WAS REQUESTED TO EXPLAIN AS TO WHY THE FULL VALUE OF CONSIDERATION SHALL NOT BE TAKEN AT RS.68,35,500/-. DURING THE COURSE OF A SSESSMENT PROCEEDINGS, THE ASSESSEE SUBMITTED THAT THE SAID LAND WAS CLASSIFIED AS BAD OR INFERTILE BY AUTHORITIES IN PIMPRI CHINCHWAD MUNICIPAL CORPORATION. FURTHER, THERE AR E RESTRICTIONS ON ANY STRUCTURE THAT WOULD BE CONSTRUCTED ON THIS LAND. FURTHER, AT THE FAG END OF THE ASSESSMENT PROCEEDINGS ON 22-12-2008, THE ASSESSEE SUBMITTED THAT VALUATIO N OFFICER MAY BE APPOINTED TO ASCERTAIN THE FAIR MARKET OF THE PROPERTY. 6. WE FIND THE AO BRUSHED ASIDE THE ABOVE ARGUMENTS ADVANCED BY THE ASSESSEE AND DECIDED TO TAKE THE VALUE ADOPTED BY T HE STAMP DUTY VALUATION AUTHORITIES AS THE FULL VALUE OF CONSIDERATION BY H OLDING AS UNDER WHICH HAS BEEN UPHELD BY THE CIT(A) : 5. IT IS WORTHWHILE TO MENTION THAT THE MARKET VAL UE, AS DECIDED BY THE STAMP VALUATION AUTHORITIES, IS DECIDED AFTER DUE CONSIDE RATION IS GIVEN TO ALL THE RELEVANT PARAMETERS. THUS, THE VALUE ADOPTED BY THE STAMP V ALUATION AUTHORITIES IS A FAIR MARKET VALUE AFTER CONSIDERING THE ASPECTS MENTIONED BY TH E ASSESSEE IN HIS SUBMISSION. THEREFORE, NO FURTHER CONTENTION OF THE ASSESSEE ON THIS ISSUE IS TENABLE. FURTHER, SECTION 4 50C OF THE IT ACT, 1961, IS SPECIFIC PROVISION WHIC H MAKES IT MANDATORY FOR ASSESSEE AS WELL AS ASSESSING OFFICER TO TAKE THE STAMP VALUATI ON AUTHORITY AS THE BASIS FOR COMPUTING THE CAPITAL GAIN. IT IS FURTHER WORTHWHILE TO MENT ION THAT THE REFERENCE TO THE STAMP VALUATION AUTHORITY IS ONLY DISCRETIONARY AND NOT C OMPULSORY. THE WORD USED IN SECTION 50C FOR REFERENCE TO EVALUATION OFFICER IS MAY AN D NOT SHALL. IT IS ONLY TO COVER THE EXCEPTIONAL CASES. IN VIEW OF THE ABOVE DISCUSSION , IT IS FOUND THAT ASSESSEES SUBMISSIONS DESERVE TO BE REJECTED. THEREFORE, THE FULL VALUE OF CONSIDERATION IS TAKEN AT THE VALUE ADOPTED BY THE STAMP DUTY VALUATION AUTHORITIES. 7. WE FIND IDENTICAL ISSUE HAD COME UP BEFORE THE T RIBUNAL IN THE CASE OF M/S.ELCAB WIRES PVT. LTD. (SUPRA). WE FIND THE TRI BUNAL AFTER CONSIDERING THE PROVISIONS OF SECTION 50C RESTORED THE ISSUE TO THE FILE OF THE AO WITH A DIRECTION TO REFER THE MATTER TO THE VALUATION OFFICER AND THERE AFTER PROCEED TO COMPLETE THE CAPITAL GAINS IN ACCORDANCE WITH LAW BY HOLDING AS UNDER : 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS CAREFU LLY. THE ONLY ASPECT IN THIS APPEAL RELATES TO THE MANNER OF DETERMINATION OF FULL VALU E OF CONSIDERATION IN A CASE WHERE THE PROVISIONS OF SECTION 50C(1) OF THE ACT HAVE BEEN I NVOKED. AS PER THE APPELLANT, THOUGH THE STATED CONSIDERATION FOR THE TRANSFER OF LAND W AS BELOW THE VALUE DETERMINED BY THE STAMP VALUATION AUTHORITY FOR THE PURPOSES OF PAYME NT OF STAMP DUTY, SO, HOWEVER, SUCH VALUE COULD NOT BE IPSO FACTO ADOPTED BY THE ASSESS ING OFFICER IN TERMS OF SECTION 50C(1) OF THE ACT BECAUSE THE ASSESSEE HAD OBJECTED TO THE SAME AND THE PROVISIONS OF SECTION 50C(2) REQUIRED THE ASSESSING OFFICER TO REFER THE MATTER TO THE VALUATION OFFICER. IN THIS REGARD, WE HAVE PERUSED THE RELEVANT PROVISIONS WHI CH READ AS UNDER: 50C(1) WHERE THE CONSIDERATION RECEIVED OR ACCRUIN G AS A RESULT OF THE TRANSFER BY ANASSESSEE OF A CAPITAL ASSET, BEING LAND OR BUILDI NG OR BOTH, IS LESS THAN THE VALUE ADOPTED OR ASSESSED (OR ASSESSABLE) BY ANY AUTHORIT Y OF A STATE GOVERNMENT (HEREAFTER IN THIS SECTION REFERRED TO AS THE STAMP VALUATION AU THORITY) FOR THE PURPOSE OF PAYMENT OF STAMP DUTY IN RESPECT OF SUCH TRANSFER, THE VALU E SO ADOPTED OR ASSESSED (OR ASSESSABLE) SHALL, FOR THE PURPOSES OF SECTION 48, BE DEEMED TO BE THE FULL VALUE OF THE CONSIDERATION RECEIVED OR ACCRUING AS A RESULT OF S UCH TRANSFER. (2) WITHOUT PREJUDICE TO THE PROVISIONS OF SUB-SECT ION (1), WHERE (A) THE ASSESSEE CLAIMS BEFORE ANY ASSESSING OFFICE R THAT THE VALUE ADOPTED OR ASSESSED (OR ASSESSABLE) BY THE STAMP VA LUATION AUTHORITY UNDER SUBSECTION (1) EXCEEDS THE FAIR MARKET VALUE OF THE PROPERTY AS ON THE DATE OF TRANSFER; (B) THE VALUE SO ADOPTED OR ASSESSED (OR ASSESSABLE ) BY THE STAMP VALUATION AUTHORITY UNDER SUB-SECTION (1) HAS NOT B EEN DISPUTED IN ANY APPEAL OR REVISION OR NO REFERENCE HAS BEEN MADE BE FORE ANY OTHER AUTHORITY, COURT OR THE HIGH COURT, THE ASSESSING O FFICER MAY REFER THE VALUATION OF THE CAPITAL ASSET TO A VALUATION OFFIC ER AND WHERE ANY SUCH REFERENCE IS MADE, THE PROVISIONS OF SUB-SECTIONS ( 2), (3), (4), (5) AND (6) OF SECTION 16A, CLAUSE (I) OF SUB-SECTION (1) AND S UB-SECTIONS (6) AND (7) OF SECTION 23A, SUB-SECTION (5) OF SECTION 24, SECT ION 34AA, SECTION 35 AND SECTION 37 OF THE WEALTH-TAX ACT, 1957 (27 OF 1 957), SHALL, WITH NECESSARY MODIFICATIONS, APPLY IN RELATION TO SUCH REFERENCE AS THEY APPLY IN RELATION TO A REFERENCE MADE BY THE ASSESS ING OFFICER UNDER SUB- SECTION (1) OF SECTION 16A OF THAT ACT. 4 5 (EXPLANATION 1) - FOR THE PURPOSES OF THIS SECTION, VALUATION OFFICER SHALL HAVE THE SAME MEANING AS IN CLAUSE (R) OF SEC TION 2 OF THE WEALTH- TAX ACT, 1957 (27 OF 1957). (EXPLANATION 2) FOR THE PURPOSES OF THIS SECTION, THE EXPRESSION ASSESSABLE MEAN THE PRICE WHICH THE STAMP VALUATI ON AUTHORITY WOULD HAVE, NOTWITHSTANDING ANYTHING TO THE CONTRARY CONT AINED IN ANY OTHER LAW FOR THE TIME BEING IN FORCE, ADOPTED OR ASSESSE D, IF IT WERE REFERRED TO SUCH AUTHORITY FOR THE PURPOSES OF THE PAYMENT O F STAMP DUTY. (3) SUBJECT TO THE PROVISIONS CONTAINED IN SUB-SECT ION (2), WHERE THE VALUE ASCERTAINED UNDER SUB-SECTION (2) EXCEEDS THE VALUE ADOPTED OR ASSESSED (O ASSESSABLE) BY THE STAMP VALUATION AUTHORITY REFERR ED TO IN SUB-SECTION (1), THE VALUE O ADOPTED OR ASSESSED (OR ASSESSABLE) BY SUCH AUTHORITY SHALL BE TAKEN AS THE FULL VALUE OF THE CONSIDERATION RECEIVED OR ACC RUING AS A RESULT OF THE TRANSFER. AS PER THE APPELLANT WHERE THE VALUATION ADOPTED BY THE STAMP VALUATION AUTHORITY IS DISPUTED BEFORE THE ASSESSING OFFICER, IT IS THEN I MPERATIVE FOR THE ASSESSING OFFICER TO REFER THE MATTER TO THE VALUATION OFFICER, HAVING R EGARD TO THE PROVISIONS OF SECTION 50C(2) OF THE ACT. HOWEVER, AS PER THE REVENUE THE PROVISIONS OF SECTION 50C(2) CONTAIN AN EXPRESSION MAY AND NOT SHALL AND, THEREFORE, IT IS TO BE UNDERSTOOD THE REFERENCE TO THE VALUATION OFFICER IS A DISCRETIONARY POWER VEST ED WITH THE ASSESSING OFFICER. SO, HOWEVER, IN OUR CONSIDERED OPINION, THE DISCRETION SO VESTED IN THE ASSESSING OFFICER IS REQUIRED TO BE APPLIED IN A JUDICIAL AND FAIR MANNE R. CLAUSES (A) AND (B) CONTAINED IN SECTION 50C(2) ITSELF PROVIDE THE CIRCUMSTANCES UND ER WHICH SUCH DISCRETION IS TO BE INVOKED. CLAUSE (A) OF SUB-SECTION (2) OF SECTION 5 0C PROVIDES THAT WHERE THE ASSESSEE CLAIMS. THAT THE VALUE ADOPTED . BY THE STAMP V ALUATION AUTHORITY. EXCEEDS THE FAIR MARKET VALUE OF THE PROPERTY .., THE ASS ESSING OFFICER MAY REFER THE VALUATION OF THE CAPITAL ASSET TO A VALUATION OFFICER. CLEAR LY, THE PRESENCE OF THE AFORESAID EXPRESSION IMPLIES THAT WHERE A CLAIM IS SET-UP BY THE ASSESSEE BEFORE THE ASSESSING OFFICER THAT THE VALUE ADOPTED BY THE STAMP VALUATI ON AUTHORITY EXCEEDS THE FAIR MARKET VALUE OF THE PROPERTY, THE ASSESSING OFFICER IS TO CONSIDER REFERENCE TO THE VALUATION OFFICER. IN FACT, THE JODHPUR BENCH OF THE TRIBUNAL IN THE CASE OF MRS MANJULA SINGHAL V ITO 141 TTJ 511 (JD) CONSIDERED A SIMILAR SITUATION AND AFTER TAKING INTO ACCOUNT THE IMPORT OF SUB-SECTION (2) OF SECTION 50C OF THE 5 A CT OBSERVED THAT THE TERM MAY USED IN SUB-SECTION (2) IS TO BE UNDERSTOOD AS SHALL A ND IF THE VALUATION ADOPTED BY THE STAMP VALUATION AUTHORITY IS DISPUTED BEFORE THE AS SESSING OFFICER, THEN THE ASSESSING OFFICER HAS TO REFER THE MATTER TO THE DEPARTMENTAL VALUATION OFFICER FOR DETERMINING THE FAIR MARKET VALUE OF THE PROPERTY. THEREFORE, THE A RGUMENT OF THE DEPARTMENT THAT THE REFERENCE TO THE VALUATION WAS NOT MANDATORY IN THE ABSENCE OF THE WORD SHALL IN SUB- SECTION (2) IS DEVOID OF MERIT. 7. IN THIS CONTEXT, WE MAY NOW EXAMINE THE GRIEVANC E OF THE INSTANT ASSESSEE. THE ASSESSEE IN THIS CASE SUBMITTED BEFORE THE ASSESSIN G OFFICER THAT THE VALUE ADOPTED BY THE STAMP VALUATION AUTHORITY EXCEEDED THE FAIR MAR KET VALUE OF THE PROPERTY AND IN SUPPORT OF SUCH CLAIM REASONS WERE ALSO ADVANCED, I NASMUCH AS IT WAS POINTED OUT THAT THERE WERE IMPEDIMENTS FOR GETTING PERMISSION TO CA RRY OUT CONSTRUCTION AND OTHER BUSINESS ACTIVITIES ON SUCH LAND. THE CLAIM OF THE ASSESSEE HAS BEEN SUMMARILY BRUSHED ASIDE BY THE ASSESSING OFFICER AND THIS, IN OUR VIE W, DOES NOT IMPLY A JUDICIOUS USE OF POWER VESTED IN THE ASSESSING OFFICER IN TERMS OF S ECTION 50C(2) OF THE ACT FOR REFERENCE TO A VALUATION OFFICER. THEREFORE, UNDER THESE CIRC UMSTANCES, IN OUR VIEW, THE ASSESSING OFFICER OUGHT TO HAVE REFERRED THE MATTER TO THE DE PARTMENTAL VALUATION OFFICER FOR DETERMINING THE VALUE OF THE ASSET IN QUESTION AND THEREAFTER HE SHOULD HAVE PROCEEDED IN THE MANNER MANDATED IN SECTION 50C(2) OF THE ACT . THE STATED FAILURE ON THE PART OF THE ASSESSING OFFICER, IN OUR VIEW, HAS RENDERED TH E IMPUGNED ASSESSMENT UNTENABLE, WHICH IS LIABLE TO BE SET-ASIDE. IN THE RESULT, WE RESTORE THE MATTER BACK TO THE FILE OF THE ASSESSING OFFICER WHO SHALL REFER THE MATTER TO THE DEPARTMENTAL VALUATION OFFICER AS INDICATED ABOVE AND THEREAFTER PROCEED TO COMPUTE T HE CAPITAL GAINS ON TRANSFER OF LAND 6 IN ACCORDANCE WITH LAW. NEEDLESS TO MENTION, THE A SSESSING OFFICER SHALL PROVIDE A REASONABLE OPPORTUNITY TO THE ASSESSEE OF BEING HEA RD IN THIS REGARD. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES. 8. RESPECTFULLY FOLLOWING THE DECISION OF THE COORD INATE BENCH OF THE TRIBUNAL AND IN ABSENCE OF ANY CONTRARY MATERIAL BROUGHT TO OUR NOTICE BY THE LEARNED DR WE RESTORE THE ISSUE TO THE FILE OF THE AO WITH THE DI RECTION TO REFER THE MATTER TO THE DEPARTMENTAL VALUATION OFFICER AND AFTER OBTAINING THE REPORT COMPUTE THE CAPITAL GAINS ON TRANSFER OF THE LAND AND IN ACCORDANCE WIT H LAW AFTER GIVING DUE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. WE HOL D AND DIRECT ACCORDINGLY. GROUND OF APPEAL NO.1 BY THE ASSESSEE IS ACCORDINGL Y ALLOWED FOR STATISTICAL PURPOSES. 9. GROUND OF APPEAL NO.2 BY THE ASSESSEE READS AS U NDER : 2. ON FACTS AND CIRCUMSTANCES PREVAILING IN THE CA SE AND AS PER PROVISIONS OF THE ACT IT BE HELD THAT INVESTMENTS IN TERMS OF PROVISIONS OF SEC.54EC MADE BY THE APPELLANT IS ELIGIBLE FOR DEDUCTION IN TERMS OF THE SAID SECTION . IT FURTHER BE HELD THAT THE LEARNED TAXING AUTHORITY BELOW HAD ERRED IN HOLDING THAT TH E CONDITION FOR GETTING THE RELIEF IN TERMS OF PROVISIONS OF SEC.54EC HAD NOT BEEN COMPLI ED WITH BY THE APPELLANT. THE RELIEF IN TERMS OF PROVISIONS OF SEC. 54EC BE GRANTED TO T HE APPELLANT AS PER PROVISIONS OF LAW AND FACTS PREVAILING IN THE CASE. 10. FACTS OF THE CASE, IN BRIEF, ARE THAT DURING TH E COURSE OF ASSESSMENT PROCEEDINGS THE AO NOTED THAT THE ASSESSEE HAS CLAI MED EXEMPTION OF RS.35 LAKHS U/S.54EC OF THE I.T. ACT BY PURCHASING SIDBI BONDS, THE DETAILS OF WHICH ARE AS UNDER : DATE OF PURCHASE NUMBER OF UNITS VALUE PER UNIT TOT AL VALUE 21-05-2005 150 10,000/- 15,00,000/- 21-05-2005 100 10,000/- 10,00,000/- 21-05-2005 100 10,000/- 10,00,000/- TOTAL 35,00,000/- THE AO NOTED THAT THE TRANSFER OF THE PROPERTY HAS TAKEN PLACE ON 12-08-05. THEREFORE, IN VIEW OF THE PROVISIONS OF SECTION 54E C THE ASSESSEE WOULD HAVE BEEN ELIGIBLE FOR EXEMPTION U/S.54EC IF THE INVESTMENTS IN SPECIFIC BONDS WOULD HAVE BEEN MADE BETWEEN 12-08-2005 TO 11-02-2006. SINCE IN THE INSTANT CASE THE 7 ASSESSEE MADE INVESTMENT PRIOR TO IT, I.E. ON 21-05 -2005, THEREFORE, PROVISIONS OF SECTION 54EC ARE NOT SATISFIED AND THEREFORE THE AS SESSEE CANNOT CLAIM EXEMPTION U/S.54EC. HE THEREFORE ASKED THE ASSESSEE TO EXPLA IN AS TO WHY THE CLAIM OF EXEMPTION UNDER SECTION 54EC SHOULD NOT BE DENIED. IT WAS SUBMITTED BY THE ASSESSEE THAT HE HAD RECEIVED THE SALES CONSIDERATI ON AS UNDER : DATE CHEQUE NO. AMOUNT (RS.) 03-03-2005 182018 5,00,000/- 09-03-2005 683810 2,00,000/- 11-04-2005 182034 34,24,250/- IT WAS SUBMITTED THAT THE AMOUNT RECEIVED AS ABOVE WAS INVESTED IN THE SIDBI BONDS ON 21-05-05. HOWEVER, THE AO WAS NOT SATISFI ED WITH THE EXPLANATION GIVEN BY THE ASSESSEE AND HELD THAT AS PER THE PLAIN READ ING OF SECTION 54EC, PERIOD OF MAKING INVESTMENT FOR THE SPECIFIED BONDS IS 6 MONT HS AFTER THE DATE OF TRANSFER. THEREFORE, THE QUESTION OF WHETHER THE SUM RECEIVED FROM THE TRANSFER WAS INVESTED IN SPECIFIED BONDS OR NOT IS TOTALLY IMMATERIAL. H E ACCORDINGLY REJECTED THE CLAIM OF DEDUCTION U/S.54EC OF THE INCOME TAX ACT. 11. IN APPEAL, THE LEARNED CIT(A) UPHELD THE ACTION OF THE AO. WHILE DOING SO, HE NOTED THAT THE AGREEMENT TO SALE IS DATED 13-04- 05 AND SALE DEED IS DATED 12-08-05 AND AS PER THE SALE DEED EXECUTED ON 12-08 -05 THE POSSESSION WAS HANDED OVER ON 12-08-05. SINCE THE ASSESSEE HAD PURCHASED THE BONDS ON 21-05-05, THEREFORE, HE IS NOT ELIGIBLE TO CLAIM EXEMPTION U/ S.54EC AS HE HAS NOT INVESTED THIS AMOUNT AT ANY TIME WITHIN A PERIOD OF 6 MONTHS AFTE R THE DATE OF SUCH TRANSFER. AGGRIEVED WITH SUCH ORDER OF THE CIT(A) THE ASSESSE E IS IN APPEAL BEFORE US. 12. THE LEARNED COUNSEL FOR THE ASSESSEE REFERRING TO THE DECISION OF THE NAGPUR BENCH OF THE TRIBUNAL IN THE CASE OF BHIKULAL CHAND AK (HUF) VS. ITO REPORTED IN 126 TTJ 545 SUBMITTED THAT THE TRIBUNAL IN THE SAID DECISION HAS HELD THAT ASSESSEE CANNOT BE TREATED AS A DEFAULTER IN MAKING INVESTME NT IN BONDS AS REQUIRED U/S.54EC ON RECEIPT OF ADVANCE AS PER THE AGREEMENT TO SALE PROPERTY AND CLAIMING 8 EXEMPTION U/S.54EC. THE LEARNED DR ON THE OTHER HA ND HEAVILY RELIED ON THE ORDER OF THE CIT(A). 13. WE HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY BOTH THE SIDES, PERUSED THE ORDERS OF THE AO AND THE CIT(A) AND THE PAPER BOOK FILED ON BEHALF OF THE ASSESSEE. WE HAVE ALSO CONSIDERED THE DECISION CIT ED BEFORE US. THERE IS NO DISPUTE TO THE FACT THAT THE ASSESSEE HAS RECEIVED AN AMOUNT OF RS.41,24,250/- AS ADVANCE TO SALE OF THE PLOT IN THE MONTH OF MARCH A ND APRIL 2005. THERE IS ALSO NO DISPUTE TO THE FACT THAT THE ASSESSEE HAS INVESTED AN AMOUNT OF RS.35 LAKHS OUT OF THE ABOVE AMOUNT IN SPECIFIED BONDS FOR CLAIMING EX EMPTION U/S.54EC. THERE IS ALSO NO DISPUTE TO THE FACT THAT THE ASSESSEE EXECU TED THE SALE DEED ON 12-08-2005. IT IS THE CONTENTION OF THE REVENUE AUTHORITIES THA T THE ASSESSEE SHOULD HAVE INVESTED IN SPECIFIED BONDS FOR CLAIMING EXEMPTION U/S.54EC WITHIN A PERIOD OF 6 MONTHS FROM THE DATE OF SALE, I.E.12-08-2005. IT IS THE S UBMISSION OF THE LEARNED COUNSEL FOR THE ASSESSEE THAT SINCE THE AMOUNT WAS RECEIVED IN ADVANCE BEFORE THE SALE DEED WAS EXECUTED AND SINCE THE ASSESSEE HAS INVESTED IN THE SPECIFIED BONDS AFTER RECEIVING THE ADVANCE, THEREFORE, HE IS ENTITLED TO CLAIM SUCH EXEMPTION U/S.54EC. 14. WE FIND THE NAGPUR BENCH OF THE TRIBUNAL IN THE CASE OF BHIKULAL CHANDAK (HUF) (SUPRA) AT PARA 6.3 TO PARA 7 OF THE ORDER HA S HELD AS UNDER : 6.3 THEREFORE, IF BY WAY OF A PART PERFORMANCE OF A CONTRACT AS CONTEMPLATED IN S.53A OF THE TRANSFER OF PROPERTY ACT (I.E. AGREEMENT TO SALE) THE ASSESSEE HAS RECEIVED ADVANCE PAYMENTS AND DEPOSITED THE SAME IN SPECIFIED BONDS, HE CANNOT BE CHARGED OF DEFRAUDING THE LAW. HOLDING THIS VIEW OF THE MATTER, WE EMPHAT ICALLY HOLD THAT WHEN THERE IS NO BAR TO TAKE POSSESSION BY AN AGREEMENT AND TRANSFER CAN BE TREATED TO HAVE TAKEN PLACE ON THE BASIS OF AN AGREEMENT AND ADVANCE PAYMENTS. SIMPLY BECAUSE THE SALE DEED WAS EXECUTED LATER ON, THE ASSESSEE CANNOT BE CHARGED OF DEFAULT OF VIOLATION OF THE PROVISION OF S. 54EC IN THIS PARTICULAR CASE. 6.4 EVEN WITH REGARD TO OWNERSHIP OF HOUSE PROPERTY , THE HONBLE APEX COURT IN THE CASE OF CIT VS. PODAR CEMENT (P) LTD. (1997) 141 CTR (SC ) 67 : (1997) 226 ITR 625 (SC) HAS HELD THAT UNDER THE COMMON LAW 'OWNERSHIP' MEANS A PERSON WHO HAS GOT VALID TITLE LEGALLY CONVEYED TO HIM AFTER COMPLYING WITH THE RE QUIREMENTS OF LAW SUCH AS THE TRANSFER OF PROPERTY ACT, THE REGISTRATION ACT ETC. , IN THE CONTEXT OF S. 22 OF THE IT ACT, 1961, HAVING REGARD TO THE GROUND REALITIES AND FUR THER HAVING REGARD TO THE OBJECT OF THE IT ACT, NAMELY, TO TAX THE INCOME, 'OWNER' IS A PER SON WHO IS ENTITLED TO RECEIVE INCOME 9 FROM THE PROPERTY IN HIS OWN RIGHT. THE REQUIREMENT OF REGISTRATION OF THE SALE DEED IN THE CONTEXT OF S. 22 IS NOT WARRANTED. 7. EVEN WITHOUT GOING TO ALL THE STRICT INTERPRETAT IONS, EVEN OTHERWISE ON RECEIPT OF ADVANCE AS PER THE AGREEMENT, IF THE ASSESSEE DEPOS ITED THE AMOUNT AS REQUIRED UNDER S. 54EC, HE CANNOT BE TREATED AS A DEFAULTER FOR THE S AME. 15. RESPECTFULLY FOLLOWING THE ABOVE DECISION OF TH E NAGPUR BENCH OF THE TRIBUNAL AND IN ABSENCE OF ANY CONTRARY MATERIAL BR OUGHT TO OUR NOTICE WE HOLD THAT THE ASSESSEE CANNOT BE DENIED THE BENEFIT OF EXEMPT ION U/S.54EC ON ACCOUNT OF INVESTMENT IN SPECIFIED ASSETS OUT OF THE ADVANCE R ECEIVED ON SALE OF THE PROPERTY WHICH HAS BEEN SOLD SUBSEQUENTLY. WE ACCORDINGLY S ET-ASIDE THE ORDER OF THE CIT(A) AND DIRECT THE AO TO ALLOW THE CLAIM OF EXEM PTION U/S.54EC. WE HOLD AND DIRECT ACCORDINGLY. THIS GROUND BY THE ASSESSEE IS ACCORDINGLY ALLOWED. 16. IN THE RESULT GROUND OF APPEAL NO.1 IS ALLOWED FOR STATISTICAL PURPOSES AND GROUND OF APPEAL NO.2 IS ALLOWED. PRONOUNCED IN THE OPEN COURT ON THIS THE 30 TH DAY OF OCTOBER 2012 SD/- SD/- (SHAILENDRA KUMAR YADAV) (R.K. PANDA) JUDICIAL MEMBER ACCOUNTANT MEMBER PUNE DATED: THE 30 TH OCTOBER 2012 SATISH COPY OF THE ORDER FORWARDED TO : 1. ASSESSEE 2. DEPARTMENT 3. CIT(A)-CENTRAL, PUNE 4. THE D.R, B PUNE BENCH 5. 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