The ITO, Ward-9(4), Surat V. Shri Vallabhai Dhanjibhai Lathiya, Surat

ITA 1486/AHD/2012

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 94358 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 1 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-08-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 20-08-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 05-07-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D C MISHRA
• Assessee Lawyers: KK SHAH
• Keywords: Sale consideration of property below Jantri Value; Value adopted by valuation officer; Capital asset
• Section: 50C

Judgement Text

, C IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, AHMEDABAD BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER ./ ITA NO.1486/AHD/2012 /BLOCK ASSTT. YEAR: 2007-2008 ITO, WARD - 9(4) SURAT. VS SHRI VALLABHBHAI DHANJIBHAI LATHIYA 9, ROOP SAGAR SOCIETY, A.K. ROAD SURAT 395 006. PAN : AADPL 0590 P %& / (APPELLANT) '( %& / (RESPONDENT) REVENUE BY : SHRI D.C. MISHRA, SR.DR ASSESSEE BY : SHRI K. K. SHAH / DATE OF HEARING : 20/08/2015 / DATE OF PRONOUNCEMENT: 26/08/2015 )*/ O R D E R PER RAJPAL YADAV, JUDICIAL MEMBER: THE REVENUE IS IN APPEAL AGAINST THE ORDER OF THE LD.CIT(A)-V, AHMEDABAD DATED 30.3.2012 PASSED FOR THE ASSTT.YEAR 2007-08. 2. GROUNDS TAKEN BY THE REVENUE ARE NOT IN CONSONAN CE WITH THE RULE 8 OF THE INCOME TAX (APPELLATE TRIBUNAL) RULE, 1963 THEY ARE DESCRIPTIVE AND ARGUMENTATIVE IN NATURE. IN BRIEF, THE GRIEVANCE OF THE REVENUE IS THAT THE LD.CIT(A) HAS ERRED IN DELETING THE ADDITION MADE BY THE AO WITH THE AID OF SECTION 50C OF THE INCOME TA X ACT. 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE HA S FILED ITS RETURN OF INCOME ON 27.7.2007 DECLARING TOTAL INCOME OF RS.3, 97,580/-. THE ASSESSEE HAD SOLD A LAND SITUATED AT RS NO.212, BLO CK NO.325, DINDOLI, ITA NO.1486/AHD/2012 2 SURAT. THE ASSESSEE WAS HAVING A SHARE OF 50% IN T HIS LAND. THE TOTAL SALE CONSIDERATION HAS BEEN DISCLOSED AT RS.47 LAKH S. THE ASSESSEE HAS SHOWN HIS SHARE AT RS.23.50 LAKHS AND COMPUTED THE CAPITAL GAIN. ACCORDING TO THE AO, AN INFORMATION WAS CALLED FROM THE SUB-REGISTRARS OFFICE, WHO HAS POINTED THAT THE MARKET VALUE OF TH E LAND IS RS.3,34,63,200/-. THUS, ACCORDING TO THE AO, THE ASSESSEE OUGHT TO HAVE SHOWN HIS SHARE AT RS.1,67,31,600/-. THE LD.A O HAS CONFRONTED THE ASSESSEE WITH THIS INFORMATION. THE ASSESSEE C ONTENDED THAT ON HIS OBJECTION, THE STAMP DUTY AUTHORITY HAVE FINALLY AS SESSED THE VALUE AT RS.1,33,85,300/-. THE LD.AO WROTE TO THE SUB-REGIS TRAR ALONG WITH THIS INFORMATION AND THE NAYAB COLLECTOR, STAMP DUTY VALUATION HAD ISSUED A LETTER CONCURRING WITH THE VALUE DISCLOSED BY THE A SSESSEE IN HIS REPLY AT RS.1,33,85,300/-, ON WHICH STAMP DUTY ALLEGED TO HA VE BEEN CHARGED ON THE SALE DEED. THE LD.AO TOOK 50% OF THIS AT RS .66,92,650/- AND DEEM IT AS SALE CONSIDERATION RECEIVED BY THE ASSES SEE ON TRANSFER OF CAPITAL ASSET AS PER SECTION 50C AND COMPUTED THE C APITAL GAIN. 4. DISSATISFIED WITH THIS COMPUTATION, THE ASSESSEE CARRIED THE MATTER BEFORE THE LD.CIT(A). IT EMERGES OUT THAT T HE ASSESSEE HAS RAISED AN OBJECTION AS PER SECTION 50C(2) AND REQUE STED THAT THE VALUE OF THE PROPERTY BE DETERMINED WITH THE HELP OF DEPA RTMENTAL VALUATION OFFICER. THE LD.DVO HAS ESTIMATED THE VALUE OF THE PROPERTY AT RS.71,98,300/-. 50% OF THIS CAME TO RS.35,99,150/- . THE LD.FIRST APPELLATE AUTHORITY HAS ACCEPTED THIS VALUATION AND DIRECTED THE AO TO COMPUTE THE CAPITAL GAIN BY ADOPTING SALE VALUE OF RS.35,99,150/- INSTEAD OF RS.66,92,650/- ADOPTED BY THE AO. 5. REVENUE IS OPPOSING THIS REDUCTION IN THE DEEMED VALUE OF THE PROPERTY FOR THE PURPOSE OF COMPUTATION OF CAPITAL GAIN. THE LD.DR SUBMITTED THAT HE FAILED TO UNDERSTAND HOW THE DVO REPORT CAME INTO EXISTENCE AS ON 7.12.2012 WHEN THE ASSESSMENT ORDER HAS ALREADY ITA NO.1486/AHD/2012 3 PASSED ON 22.12.2011. THE LEARNED COUNSEL FOR THE ASSESSEE, ON THE OTHER HAND, SUBMITTED THAT A REPORT WAS CALLED FOR BY THE CIT(A) DURING THE PENDENCY OF THE APPEAL, AND IN PURSUANCE OF THA T REPORT, THIS VALUE COMES OUT. 6. WE HAVE DULY CONSIDERED RIVAL CONTENTIONS AND GO NE THROUGH THE RECORD CAREFULLY. SUB-SECTION (1) OF SECTION 50C P ROVIDES THAT 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 OR ASSESSABLE BY ANY AUTHORITY OF STATE GOVERNMENT FOR THE PURPOSE OF PAYMENT OF STAMP DUTY IN RESPECT OF SUCH TRANSFER, THE VALUE SO ADOPTED OR ASSESSED OR ASSESSABLE SHALL, FOR THE PURPOSES OF SECTION 48, BE DEEMED TO BE THE FUL L VALUE OF THE CONSIDERATION RECEIVED OR ACCRUING AS A RESULT OF S UCH TRANSFER. BOTH THE PARTIES ARE NOT DISPUTING AS FAR AS APPLICABILITY O F SECTION 50C IS CONCERNED. SUB-SECTION (2) OF THIS SECTION 50C FUR THER CONTEMPLATES THAT IF AN ASSESSEE HAS NOT DISPUTED IN ANY APPEAL OR REVISION OR NO REFERENCE WITH REGARD TO THE DETERMINATION OF VALUE FOR THE PURPOSE OF STAMP DUTY VALUATION, BUT, OBJECTS SUCH VALUATION F OR THE PURPOSE OF INCOME TAX, THEN THE AO MAY REFER THE VALUATION OF THE CAPITAL ASSET TO VALUATION OFFICER AND WHERE ANY SUCH REFERENCE IS M ADE, THE PROVISIONS OF SUB-SECTIONS (2), (3), (4), (5) AND (6) OF SECTI ON 16A OF THE WEALTH-TAX ACT WITH NECESSARY MODIFICATIONS WILL AP PLY. AS FAR AS THE APPLICABILITY OF PROVISION OF WEALTH-TAX IS CONCERN ED, THIS IS NOT IN DISPUTE. THE QUESTION IS THE MOMENT THE VALUATION OFFICER HAS DETERMINED THE VALUE, AND IF NOT DISPUTED BY THE AS SESSEE, THEN THE LONG TERM CAPITAL GAIN BY THE ASSESSEE WOULD BE COM PUTED BY DEEMING SUCH VALUATION OF THE PROPERTY AS CONSIDERATION REC EIVED BY THE ASSESSEE. THE LD.FIRST APPELLATE AUTHORITY HAS DIR ECTED THE AO EXACTLY IN TERMS OF SECTION 50C(2) OF THE INCOME TAX ACT. WE DO NOT FIND ANY ERROR AT THE END OF THE LD.FIRST APPELLATE AUTHORIT Y, THEREFORE, NO ITA NO.1486/AHD/2012 4 INTERFERENCE IS CALLED FOR IN THE ORDER OF THE LD.C IT(A), AND ACCORDINGLY, THIS GROUND OF THE REVENUE IS DISMISSED. 7. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. ORDER PRONOUNCED IN THE COURT ON 26 TH AUGUST, 2015 AT AHMEDABAD. SD/- SD/- (MANISH BORAD) ACCOUNTANT MEMBER (RAJPAL YADAV) JUDICIAL MEMBER