MRADULA AGARWAL, Jaipur V. ITO, Jaipur

ITA 15/JPR/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 99609 (ITAT-JAIPUR)
• Duration Of Justice: 1 year(s) 11 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-12-2015
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 06-01-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RAJ MEHRA JCIT DHK
• Assessee Lawyers: S L PODDAR
• Keywords: Sale consideration of property below Jantri Value; Capital asset; Gift; Cost of acquisition; Fair market value
• Section: 50C; 5(2); 56(2); 56

Judgement Text

ITA NO. 15/JP/14 SMT. MRADULA AGARWAL JAIPUR VS. ITO WARD 5(2) JAIPU R 1 VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, JAIPUR JH VKJ-IH-RKSYKUH] U;KF;D LNL; ,OA JH FOE FLAG ;KN O] YS[KK LNL; DS LE{K BEFORE: SHRI R.P. TOLANI, JM & SHRI VIKRAM SINGH YA DAV, AM VK;DJ VIHY LA-@ ITA NO. 15/JP/14 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2010-11 SMT. MRADULA AGARWAL. 395 NARNOLI MANSION, SANGANERI GATE, JAIPUR CUKE VS. INCOME TAX OFFICER, WARD 5(2), JAIPUR LFKK;H YS[KK LA-@THVKBZVKJ LA-@ AASPA 6312 K VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI S.L. PODDAR ADVOCATE JKTLO DH VKSJ LS@ REVENUE BY : SHRI RAJ MEHRA (JCIT) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 15.10.2015 ?KKS'K .KK DH RKJH[K @ DATE OF PRONOUNCEMENT : 15/12/2015. VKNS'K@ ORDER PER SHRI VIKRAM SINGH YADAV, A.M. THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF THE CIT(A)-II, JAIPUR DATED 18.2.2013 WHEREIN THE ASSES SEE HAS TAKEN THE FOLLOWING TWO GROUNDS OF APPEAL:- 1. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE TH E LD. CIT(A) HAS ERRED IN SUSTAINING THE ADDITION OF RS. 25,52,1 37/0 ON ACCOUNT OF GIFT RECEIVED FROM BHATIJA (PARESH AGARWAL) U/S 56(2)(VII)(B) OF THE IT ACT. 1961. ITA NO. 15/JP/14 SMT. MRADULA AGARWAL JAIPUR VS. ITO WARD 5(2) JAIPU R 2 2. UNDER THE FACT AND CIRCUMSTANCES OF THE CASE THE LD. CIT (A) HAS ERRED IN SUSTAINING THE ADDITION OF RS. 30,08,6 67/- ON ACCOUNT OF LONG TERM CAPITAL GAIN BY INVOKING THE PROVISION OF SECTION 50C OF THE IT ACT, 1961. 2 REGARDING FIRST GROUND OF APPEAL, THE FACTS AS APP ARENT FROM THE ASSESSMENT ORDER ARE AS UNDER: 2.1 DURING THE YEAR, THE ASSESSEE HAS RECEIVED A GI FT OF RESIDENTIAL PLOT MEASURING 309.35 SQ.MTR SITUATED AT 838, MAHAVEER NAGAR, TONK ROAD, JAIPUR FROM SHRI PARESH AGARWAL S/O SHRI CHANDRA MOHA N AGARWAL R/O 3, SETHANI KA BAGH, MOTI DUNGARI ROAD, JAIPUR THROUGH GIFT DEED REGISTERED ON 10.11.2009. THE SUB REGISTRAR VALUED THE PROPERTY AT RS.25,53,137/- AND CHARGED STAMP DUTY ON IT. THE AS SESSEE HAS CLAIMED THE ABOVE RECEIPT OF PLOT AS EXEMPT U/S 56(2)(VII)(B) OF THE ACT. 2.2 ACCORDING TO THE PROVISIONS OF SECTION 56(2)(VII)(B) (I), THE STAMP DUTY VALUE OF THE IMMOVABLE PROPERTY RECEIVED BY AN IN DIVIDUAL FROM ANY PERSON WITHOUT ANY CONSIDERATION SHALL BE CHARGEABL E TO TAX. THE PROVISIONS OF THIS CLAUSE SHALL NOT APPLY TO ANY PROPERT Y RECEIVED FROM ANY RELATIVE. THE RELATIVE IS DEFINED IN THE EXP LANATION TO CLAUSE (VI) OF SUB-SECTION (2) OF SECTION 56 AS UNDER: ITA NO. 15/JP/14 SMT. MRADULA AGARWAL JAIPUR VS. ITO WARD 5(2) JAIPU R 3 (I) SPOUSE OF THE INDIVIDUAL (II) BROTHER OR SISTER OF THE INDIVIDUAL (III) BROTHER OR SISTER OF THE SPOUSE OF THE INDIVIDUAL (IV) BROTHER OR SISTER OF EITHER OF THE PARENTS OF THE INDI VIDUAL (V) ANY LINEAL ASCENDANT OR DESCENDANT OF THE INDIVIDUAL (VI) ANY LINEAL ASCENDANT OR DESCENDANT OF THE SPOUSE OF TH E INDIVIDUAL (VII) SPOUSE OF THE PERSONS REFERRED TO IN CLAUSES (II) TO (VI ) 2.3 AS PER THE AO, THOUGH IT IS UNDISPUTED THAT, SOC IALLY, THE ASSESSEE AND SHRI PARESH AGARWAL (DONOR) ARE CHACHI AND BHATIJ A RESPECTIVELY AND THEY ARE RELATIVES OF EACH OTHER. BUT, IN THE PRE SENT CONTEXT THE ABOVE RELATION IS TO BE EXAMINED WITH REFERENCE TO DEFI NITION OF RELATIVE GIVEN UNDER THE PROVISIONS OF SECTION 56(2) OF THE INCOME TAX ACT, 1961. WHEN THE TERM RELATIVE HAS BEEN DEFIN ED IN THE ACT ITSELF AND THERE IS NO AMBIGUITY IN IT, THERE IS NO SCOPE FOR READING BETWEEN THE LINE AND CONSTRUING OWN INTERPRETATION THEREOF. THUS, FROM THE ABOVE DISCUSSED FACTS OF THE CASE, IT I S CRYSTAL CLEAR THAT SHRI PARESH AGARWAL IS NOT A RELATIVE OF THE ASSESS EE AS DEFINED U/S 56(2). HOWEVER, ON THE OTHER HAND, THE ASSESSEE IS A RELATIVE OF SHRI PARESH AGARWAL UNDER THE SAME DEFINITION. IF T HE ASSESSEE (CHACHI) HAD BEEN THE DONOR AND SHRI PARESH AGARWAL (BHATIJA) HAD BEEN THE ITA NO. 15/JP/14 SMT. MRADULA AGARWAL JAIPUR VS. ITO WARD 5(2) JAIPU R 4 DONEE, THEN SUCH GIFT WOULD HAVE BEEN EXEMPT IN THE H ANDS OF SHRI PARESH AGARWAL (RECEIPIENT). BUT IT CANNOT BE READ A S VICE-VERSA. IN VIEW OF THE ABOVE, IT WAS HELD BY AO THAT SHRI P ARESH AGARWAL IS NOT A RELATIVE OF THE ASSESSEE AS DEFINED U/S 56 (2) AND THEREFORE, ANY RECEIPT OF IMMOVABLE PROPERTY FROM HIM WITHOUT CONSI DERATION SHALL BE CHARGEABLE TO TAX UNDER THE HEAD OTHER SOUR CES AND ACCORDINGLY STAMP DUTY VALUE OF SUCH PROPERTY I.E. RS. 25,52,137/- SHALL BE INCLUDED IN THE TOTAL INCOME OF THE ASSESSEE. ACCO RDINGLY AN ADDITION OF RS. 25,52,137/- WAS MADE IN THE TOTAL INCOM E OF THE ASSESSEE. 2.4. BEING AGGRIEVED, THE ASSESSEE CARRIED THE MATT ER IN APPEAL BEFORE THE LD. CIT(A) WITHOUT ANY SUCCESS. THE RELEVANT FI NDING OF THE LD. CIT(A) ARE AT PARA 3.3 OF HIS ORDER WHICH READS AS UNDER: I HAVE CONSIDERED THE FACTS OF THE CASE, ASSESSMENT ORDER AND APPELLANTS WRITTEN SUBMISSION. APPELLANT RECEIVED G IFT IN THE FORM OF A PLOT OF LAND FROM HER NEPHEW, VALUE OF WHICH WAS CL AIMED EXEMPT. HOWEVER, ASSESSING OFFICER FOUND THAT DONOR NEPHEW IS NOT COVERED IN THE DEFINITION OF RELATIVE MENTIONED IN SECTION 56(2 ) OF IT ACT. SINCE THE ITA NO. 15/JP/14 SMT. MRADULA AGARWAL JAIPUR VS. ITO WARD 5(2) JAIPU R 5 GIFT OF PROPERTY WAS RECEIVED BY THE APPELLANT FROM A PERSON NOT DEFINED AS RELATIVE IN THE SAID SECTION ASSESSING OFFICER T AXED THE INCOME UNDER SECTION 56(2). APPELLANT SUBMITTED THAT AS PER DEFIN ITION, APPELLANT IS RELATIVE THEN HOW DONOR NEPHEW IS NOT RELATIVE. APP ELLANT FURTHER ARGUED THAT RELATIVE IS A PLURAL TERM AND NOT A SING ULAR. WHEN APPELLANT IS RELATIVE AS PER DEFINITION TO HER NEPHEW THEN HE R NEPHEW WILL BE RELATIVE TO HER AND ACCORDINGLY GIFT RECEIVED FROM NEPHEW IS EXEMPT FROM TAX. IT IS NOT IN DISPUTE THAT THE TERM RELATI VE USED IN SECTION 56(2) IS DEFINED AND AS PER DEFINITION MENTIONED AND ELABORATELY DISCUSSED IN THE ASSESSMENT ORDER, THOUGH APPELLANT IS RELATIVE TO THE NEPHEW BUT NEPHEW IS NOT RELATIVE TO THE APPELLANT . WHEN DEFINITION IS CLEARLY PROVIDED IN THIS SECTION, THERE IS NO SCOPE OF GIVING WIDER MEANING IN IT. WHETHER RELATIVE IS PLURAL OR SINGUL AR IS NOT RELEVANT. THE MEANING GIVEN TO THE WORD HAS TO BE STRICTLY INTERPR ETED AND AS PER THIS, DONOR NEPHEW IS NOT COVERED IN THE DEFINITION OF RE LATIVE. THE ARGUMENTS OF THE APPELLANT ABOUT SOCIAL CUSTOMS ETC. ARE ALSO NOT RELEVANT SINCE DEFINITION OF THE WORD RELATIVE IS NOT LEFT OPEN TO BE DECIDED AS PER SOCIETAL NORMS. ANY INCOME IS EXEMPT ONLY WHEN IT FUL FILLS THE CONDITIONS MENTIONED IN THE ACT. IF THE INCOME DOES NOT FULFILL THE STRICT CONDITIONS FOR EXEMPTION THE SAME CANNOT BE TREATED AS EXEMPT. ACCORDINGLY, I AGREE WITH THE ASSESSING OFFICER THAT APPELLANT IS LIABLE FOR TAX ON THE VALUE OF GIFT RECEIVED FROM NEPHEW WHO IS NOT COVERE D IN THE DEFINITION OF RELATIVE GIVEN UNDER SECTION 56(2). AS A RESULT OF THIS, ADDITION MADE BY THE ASSESSING OFFICER IS CONFIRMED. 2.5 DURING THE COURSE OF HEARING, THE LD. AR SUBMITTE D THAT THE TERM RELATIVE IS PLURAL AND RELATION BETWEEN ANY TWO PER SONS MAKE THEM RELATIVE. IF NIECE/NEPHEW ARE COVERED UNDER THE DEF INITION, THEN THE AUNT ALSO OUGHT TO BE COVERED, BECAUSE THERE CANNOT BE A NIECE/NEPHEW WITHOUT THE AUNT. THUS, WHEN THE AUNT IS COVERED UNDER THE DEFINITION OF RELATIVE W.R.T. THE NIECE/NEPHEW, THERE COULD BE NO JUSTIFICATION AS TO HOW THE NIECE/NEPHEW COULD BE OUTSI DE THE AMBIT OF THE TERM RELATIVE W.R.T. THE AUNT. IN OUR HINDU TRADITION GIFT IS ALWAYS ITA NO. 15/JP/14 SMT. MRADULA AGARWAL JAIPUR VS. ITO WARD 5(2) JAIPU R 6 GIVEN BY YOUNGERS TO THEIR ELDERS, PARENTS, UNCLE A ND AUNTS. THEREFORE THE DEFINITION GIVEN IN SECTION 56 ALSO COVERS THE REL ATION OF AUNT AND NEPHEW WHEN THE RELATION VICE-VERSA IS UNDISPUTED. THE APPELLANT FURTHER SUBMITTED THAT THE TERM RELA TIVE IS A CONNECTION WHICH JOINS TWO PERSONS AND IT CANNOT BE IMAGI NED THAT, WHEN A IS RELATIVE OF B, B IS NOT RELATIVE OF A. THE PROVISIONS OF THE IT ACT HAVE TO BE CONSIDERED IN A HOLISTIC MANNER AND N OT IN A RESTRICTIVE MANNER. IN VIEW OF THIS IT IS SUBMITTED ONCE IT IS E STABLISHED THAT THE APPELLANT WAS A RELATIVE OF THE DONOR, THE GIFT SO RECE IVED IS EXEMPT. THUS NO ADDITION CAN BE MADE. THE APPELLANT HAS RECEI VED GIFT IN THE CAPACITY OF THE RELATIVE OF THE DONOR. THIS FACT STAN DS ADMITTED BY THE LD. ASSESSING OFFICER ALSO. THUS, IT WOULD BE ABSURD THAT, IF THE GIFT IS GIVEN BY THE APPELLANT TO HER NEPHEW (SHRI PARESH), IT WOULD BE EXEMPT BUT THE VICE VERSA WOULD ATTRACT TAX. HENCE THE ADDI TION SO MADE BY THE ASSESSING OFFICE AND CONFIRMED BY THE LD. CIT(A) IS A BSOLUTELY ABSURD AND ERRONEOUS, THUS DESERVE TO BE DELETED. 2.6 THE LD. DR. RELIED ON THE ORDER OF THE LOWER AUTHORITIE S AND SUBMITTED THAT WHERE THE DEFINITION OF RELATIVE HAS BEEN SPECIFICALLY PROVIDED, THE SAME HAS TO BE READ AND IN THE PRESENT CONTEXT, THE GIFT BY NEPHEW TO AUNT IS NOT COVERED UNDER THE DEFINITION A ND EXEMPTION DOESNT APPLY. 2.7 WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD, THE ISSUE UNDER DISPUTE RELATES TO THE PROVISIONS OF SECTION 56(2)(VII)(B) READ WITH THE EXPLANATION WHERE MEANING OF THE ITA NO. 15/JP/14 SMT. MRADULA AGARWAL JAIPUR VS. ITO WARD 5(2) JAIPU R 7 TERM RELATIVE HAS BEEN DEFINED. IT IS NOT IN DISP UTE THAT THE ASSESSEE HAS BEEN GIFTED A PLOT OF LAND BY HER NEPHEW SHRI PAR ESH AGARWAL AND THE VALUE OF THE GIFT IS ALSO NOT IN DISPUTE AMOUNTING TO RS. 25,53,137/-. THE DISPUTES RELATES TO THE FACT WHETHER GIFT FROM NEPHEW TO THE ASSESSEE (AUNT) IS COVERED BY THE EXCLUSION CLAUSE A S PER SECTION 56(VII)(B) WHICH READS AS UNDER: PROVIDED FURTHER THAT THIS CLAUSE SHALL NOT APPLY TO ANY SUM OF MONEY OR ANY PROPERTY RECEIVED FROM ANY RELATIVE THE RELATIVE IS DEFINED IN THE EXPLANATION TO CLAUS E (VI) OF SUB-SECTION (2) OF SECTION 56 AS UNDER: (VIII) SPOUSE OF THE INDIVIDUAL (IX) BROTHER OR SISTER OF THE INDIVIDUAL (X) BROTHER OR SISTER OF THE SPOUSE OF THE INDIVIDUAL (XI) BROTHER OR SISTER OF EITHER OF THE PARENTS OF THE INDI VIDUAL (XII) ANY LINEAL ASCENDANT OR DESCENDANT OF THE INDIVIDUAL (XIII) ANY LINEAL ASCENDANT OR DESCENDANT OF THE SPOUSE OF T HE INDIVIDUAL (XIV) SPOUSE OF THE PERSONS REFERRED TO IN CLAUSES (II) TO (VI ) THE EXPLANATION TO SECTION 56(2)(VII) AS REPRODUCED ABOV E DEFINES A RELATIVE WITH REFERENCE TO THE ASSESSEE WHO IS AN IN DIVIDUAL. HENCE, THE ITA NO. 15/JP/14 SMT. MRADULA AGARWAL JAIPUR VS. ITO WARD 5(2) JAIPU R 8 DEFINITION OF RELATIVE IS RELATIONSHIP OF THE DONOR TO TH E DONEE ASSESSEE IN EVERY CASE. IN OTHER WORDS, THE KINGSHIP IS OF THE DONOR WITH THE ASSESSEE AND NOT VICE-VERSA. FURTHER, AS APPARENT FROM THE DEFINITION, BROTHER OR S ISTER OF EITHER PARENT OF THE INDIVIDUAL OR THEIR SPOUSE COULD BE D ONORS. UNCLE AND AUNT ARE THEREFORE COVERED BY THE EXPLANATION UNDER C LAUSE (IV) AND (VII). LINEAL ASCENDANT OR DESCENDANT REFERRED IN CL AUSE (V) & (VI) COVERES ONLY THE LINEAL ASCENDANT OR DESCENDANT OF THE INDIVIDUAL OR HIS/ HER SPOUSE, SO THAT ANY ASSSSEE, WHO RECEIVE A GIFT FROM HIS/HER NEPHEW OR NIECE WILL BE TAXED SINCE THE NEPHEW AND NIECE IS NOT THE LINEAL DESCENDENT OF HIMSELF OR HIS WIFE AS IN THE I NSTANT CASE. GIVEN THE UNAMBIGIOUS DEFINITION OF RELATIVE EVEN THOUG H RESTRICTED AS CLAIMED BY THE APPELLANT, WE ARE UNABLE TO ACCEDE TO THE ARGUMENTS OF THE APPELLANT THAT THE DEFINITION SHOULD BE GIVEN A M ORE LIBERAL INTERPRETATION AND SHOULD COVER THE RELATIONSHIP OF NEP HEW DONOR GIVING GIFT TO HIS AUNT. IT IS FOR THE LEGISLATURE T O PROVIDE FOR THE ITA NO. 15/JP/14 SMT. MRADULA AGARWAL JAIPUR VS. ITO WARD 5(2) JAIPU R 9 EXPANDED DEFINITION OF THE RELATIVE AND UNTIL SUCH TIME, THE AMENDMENT IS BROUGHT ON THE STATUE BOOK, THE CURRENT DEFINITION OF RELATIVE IN RELATION TO INDIVIDUAL DONEE STANDS AND WI LL APPLY IN THE INSTANT CASE. WE ACCORDINGLY CONFIRM THE FINDING OF T HE LD. CIT(A) AND SEE NO INFIRMITY IN HIS ORDER HENCE THE GROUND OF APPEA L TAKEN BY THE ASSESSEE IS DISMISSED. 3. THE SECOND GROUND IS AGAINST THE ADDITION OF RS.30,0 8,667/- ON ACCOUNT OF LONG TERM CAPITAL GAIN BY INVOKING THE PROVIS ION 50C OF THE IT ACT, 1961. 3.1 THE FACTS OF THE CASE AS APPARENT FROM THE ASSESS MENT ORDER ARE AS UNDER: 3.2 DURING THE YEAR UNDER CONSIDERATION, THE ASSESSEE HAS CLAIMED LONG TERM CAPITAL LOSS OF RS. 9,80,116/- ON SALE OF AN IMMOVABLE PROPERTY (RESIDENTIAL PLOT) MEASURING 348.39 SQ. MTR. SITUATED AT 236 TARU CHHAYA NAGAR, TONK ROAD, JAIPUR FOR TOTAL SALE CONS IDERATION OF RS. 8,50,000/- THROUGH AGREEMENT DATED 04.11.2009. SHE HAS COMPUTED HER LONG TERM CAPITAL LOSS AS UNDER: SALE CONSIDERATION (04.11.2009) RS. 8,50,000/- LESS: INDEXED COST OF ACQUISITION RS. 18,30,116/- ITA NO. 15/JP/14 SMT. MRADULA AGARWAL JAIPUR VS. ITO WARD 5(2) JAIPU R 10 (7,50,000 X 632/259) LONG TERM CAPITAL GAIN RS. 9,80,166/- THE ABOVE SALE DEED WAS NOT SUBMITTED BEFORE THE SUB REGISTRAR FOR REGISTRATION AND NO STAMP DUTY HAS BEEN PAID ON IT. THEREFORE, THE TRANSFERRED PROPERTY WAS REFERRED TO T HE SUB REGISTRAR VIII, JAIPUR FOR ITS VALUATION AS ON THE DAT E OF TRANSFER FOR CHARGING STAMP DUTY ON THE ABOVE TRANSACTION. THE SUB REGISTRAR- VIII JAIPUR HAS INTIMATED THE DLC RATE OF THE ABOVE P LOT AT RS. 11,630/- PER SQ.MTR. AS ON THE DATE OF TRANSFER. ACCO RDINGLY THE VALUE OF VACANT PLOT WAS COMPUTED AT RS. 40,51,77/- (3 48.39 SQ. MT. X 11639) FOR THE PURPOSE OF CHARGING STAMP DUTY ON THE ABOVE TRANSACTION. THE ASSESSEE WAS ASKED VIDE NOTE-SHEET DATED 0.10.2 012 TO EXPLAIN AS WHY THE DLC RATE SHOULD NOT BE APPLIED AND CAPITAL GAIN SHOULD NOT BE COMPUTED IN ACCORDANCE TO THE PROVISI ONS OF SECTION 50C. IN COMPLIANCE, THE LD. AR VIDE HIS LETT ER DATED 17.10.2012 OBJECTED THE APPLICABILITY OF THE PROVISION S OF SECTION 50C, STATING THAT, THE OWNERSHIP RIGHTS OF THE TRANSF ERRED LAND WAS NOT VESTED IN THE ASSESSEE AS THE RIICO IS THE ACTUA L OWNER OF THE TRANSFERRED LAND AND THE ASSESSEE HAS SOLD ONLY THE D ISPUTED TITLE OF LAND WHICH WAS IN HER NAME. THE LD. AR FURTHER R EQUESTED TO REFER THE MATTER TO THE DVO FOR DETERMINING THE FAIR MARKET VALUE OF THE PROPERTY. THE VALUATION OFFICER VALUED THE SAI D PROPERTY AT RS. 40,62,000/- AS ON 4.11.2009 AFTER DULY CONSIDERIN G THE SUBMISSIONS/DOCUMENTS/ OBJECTIONS OF THE ASSESSEE AND PHYSICALLY INSPECTING THE SAID PROPERTY WHICH WAS AG AIN NOT ACCEPTED BY THE ASSESSEE. THE AO, HOWEVER, DIDNT ACCEPT THE OBJECTIONS OF THE ASSESSEE AND COMPLETED THE PROCEEDIN GS BY BRINGING TO TAX THE SALE CONSIDERATION AS DETERMINE BY THE DVO. ITA NO. 15/JP/14 SMT. MRADULA AGARWAL JAIPUR VS. ITO WARD 5(2) JAIPU R 11 3.3 BEING AGGRIEVED, THE ASSESEE CARRIED THE MATTER BEFORE THE LD. CIT(A) WHO DISMISSED THE APPEAL OF THE ASSESSEE. THE RELEVANT FINDING OF THE LD. CIT(A) ARE CONTAINED AT PARA 4.3 OF ITS ORDER WHICH READS AS UNDER: I HAVE CONSIDERED THE FACT OF THE CASE, ASSESSMENT ORDER AND APPELLANT WRITTEN SUBMISSION. APPELLANT OLD PRO PERTY BUT THE DOCUMENT IS NOT REGISTERED WITH SUB-REGISTRAR. ASSESSING OFFICER APPLIED PROVISIONS OF SECTION 50C AND COMPU TED CAPITAL GAIN ON THE ASSESSABLE VALUE OF THE PROPERTY. APPE LLANT SUBMITTED THAT SINCE THE SALE DEED WAS NOT PRESENTED TO THE REGISTERING AUTHORITY, THERE WAS NO VALUE ADOPTED B Y SUB REGISTRAR AND THEREFORE PROVISIONS OF SECTION 50C A RE NOT APPLICABLE IN HER CASE. APPELLANT ALSO OBJECTED TH AT THE PROPERTY WAS UNDER LITIGATION AND THEREFORE APPLYIN G DLC RATE FOR ARRIVING AT MARKET RATE IS NOT CORRECT. ASSESSING OFFICER DISCUSSED THE PROVISIONS VERY CL EARLY ALONGWITH APPELLANTS OBJECTIONS. WITH EFFECT FROM 1.10.2009 PROVISIONS OF SECTION 50C WAS AMENDED TO INCLUDE ASS ESSABLE VALUE ALSO WHICH MEANS EVEN IF PROPERTY IS NOT REGIS TERED AND MARKET VALUE IS NOT ASSESSED BY SUB REGISTRAR, STILL SECTION 50C IS APPLICABLE ON ASSESSABLE VALUE. SINCE TRANSFER O F PROPERTY IN THIS CASE IS AFTER THIS DATE, THE AMENDED PROVISIONS ARE CLEARLY APPLICABLE. ACCORDINGLY ASSESSING OFFICER IS JUSTI FIED IN TAKING THE DLC RATE WHICH IS ASSESSABLE VALUE OF THE PROPE RTY WITH SUB REGISTRAR. THE DECISIONS RELIED UPON BY THE ASSESS ING OFFICER ARE CLEARLY APPLICABLE HERE. AS REGARDS APPELLANTS OBJECTIONS REGARDING DISPUT E OVER THE PROPERTY, ASSESSING OFFICER REFERRED THE MATTER TO D ISTRICT ITA NO. 15/JP/14 SMT. MRADULA AGARWAL JAIPUR VS. ITO WARD 5(2) JAIPU R 12 VALUATION OFFICER AS REQUIRED IN SECTION 50C. THE DVO VALUE THE PROPERTY AS PER DLC RATE. ASSESSING OFFICER WAS BO UND TO ADOPT THE SAID VALUE ADOPTED BY DVO AS DECIDED BY SEVERAL JUDICIAL DECISIONS MENTIONED IN ASSESSMENT ORDER. ASSESSING O FFICER DEALT WITH THE OBJECTIONS OF THE APPELLANT AND COMP UTED CAPITAL GAIN STRICTLY AS PER PROVISIONS OF SECTION 50C WHIC H IS CLEARLY APPLICABLE IN THE CASE OF APPELLANT AFTER AMENDMENT. ACCORDINGLY, THE APPLICABILITY OF SECTION 50C AND C ONSEQUENT COMPUTATION OF CAPITAL GAIN MADE BY THE ASSESSING O FFICER IS CONFIRMED. 3.4 DURING THE COURSE OF HEARING, THE LD. AR REITERAT ED THE SUBMISSION BEFORE THE LD. CIT(A) THROUGH ITS WRITTEN SUBMISSION WHICH ARE REPRODUCED AS UNDER: IT IS SUBMITTED THAT THE APPELLANT HAS PURCHASED T HIS PLOT FROM SHRI JAGMOHAN SHARMA UNDER AN AGREEMENT DATED 10.1.2 005. A COPY OF THIS AGREEMENT IS AVAILABLE ON PAPER BOOK CITED SUPRA. THE PERUSAL OF THE AGREEMENT REVELS THAT SHRI JAGMOHN SHARMA WAS ALLOTTED PLOT NO. 236 BY SUBHASH SINDHI COOPERATIVE HOUSING SOCIETY LTD. AS TARUCHHAYA NAGAR, TONK ROAD, JA IPUR. THE AREA OF THE PLOT WAS 4116.66 SQUARE YARDS. HOWEV ER, SUBSEQUENTLY THE AREA OF TARUHHAYA NAGAR WAS ACQUIRE D BY RIICO. IT IS SUBMITTED THAT THE SOCIETY HAS PURCHAS ED THIS LAND UNDER AN AGREEMENT FROM ONE SHRI RATAN KUMAR SHARMA A ND OTHERS ON 15.04.1975. HOWEVER SUBSEQUENTLY THE STATE G OVT. OF RAJASTHAN ISSUED NOTIFICATION FOR ACQUISITION OF LAND ON 20.02.196 AND SUBSEQUENTLY THE SAME WAS ACQUIRED BY RIICO ON 4.02.1991. THESE FACTS ARE AVAILABLE IN THE PAPE RS ENCLOSED HEREWITH. THE LETTER DTED 13.08.1986 DISCLOSES THAT TARU CHHAYA NAGAR SCHEME WS PLANNED BY SUBHASH SINDHI HOU SING ITA NO. 15/JP/14 SMT. MRADULA AGARWAL JAIPUR VS. ITO WARD 5(2) JAIPU R 13 COOPERATIVE SOCIETY, JAIPUR. A COPY OF LETTER DATED 13. 08.1986 IS AVAILABLE ON PAPER BOOK PAGE NO. 38. THE DECISION OF THE RAJASTHAN HIGH COURT DATED 25.01.2007 BY SINGLE BENC H JUDGE JUSTICE ASHOK PARIHAR DISCLOSES THAT THE PETITION OF THE PETITIONERS WAS DISMISSED. A COPY OF THIS DECISION IS AVAILABLE ON PAPER BOOK PAGE NO. 39 TO 46. SIMILARLY THE DOUBLE B ENCH ALSO DISMISSED THE PETITION OF THE PETITIONERS VIDE ORDE R DATED 1.08.2011 BY DOUBLE BENCH JUDGES JUSTICE BELAM TRIV EDI AND JUSTICE ARUN MISHRA. A COPY OF THIS DECISION IS AVAIL ABLE ON PAPER BOOK T PAGE NO.47 TO 69,. THE PERUSAL OF THESE PA PERS INDICATES THAT THE KHATEDAR RATAN KUMAR SHARMA AND OTHERS WENT UPTO THE HIGHEST COURT OF THE LAND BUT DID NOT S UCCEED. ALL THESE FACTS WERE BROUGHT TO THE NOTICE OF THE LD. AO BUT HE HAS DISMISSED THE OBJECTIONS RAISED BY THE APPELLANT ON THE GROUND THAT NO PAPER WAS PRODUCED REGARDING THE KHATED AR AND THE GOVT. OF RAJASTHAN AND RIICO. HOWEVER, THE LD . AO WAS REQUIRED TO MAKE VERIFICATION OF THE FACTS SUBMITTED B Y THE APPELLANT EITHER FROM RIICO OR FROM THE OFFICE OF SOCIET Y SO AS TO FIND OUT THE TRUTH BUT NOTHING OF THIS SORT WAS DONE. EVEN AS ON DATE THE TILE OF LAND IN TARU CHHAYA NAGAR IS IN D ISPUTE AND IT IS BECAUSE OF THIS NO DLC RATE IS APPLICABLE. THE A PPELLANT IN ORDER OF GET RID OF MENTAL TENSION GAVE AWAY THE DISPUT ED TITLE BY TRANSFERRING THE ALLOTMENT LETTER. IN VIEW OF THI S THE LD. AO WAS NOT JUSTIFIED IN APPLYING DLC RATES FOR VALUING THE PLOT AT RS. 40,62,000/-. IT IS SUBMITTED THAT THE ADDITION MADE BY THE LD. AO DO NOT HAVE ANY LEGS AND DESERVES TO BE DELETED . 3.5 THE LD. DR RELIED ON THE ORDER OF THE LOWER AUTHO RITIES. 3.6 WE HAVE HEARD THE RIVAL CONTENTIONS AND PURSUED T HE MATERIAL ON RECORD. IN ORDER TO APPRECIATE THE ISSUE UNDER ITA NO. 15/JP/14 SMT. MRADULA AGARWAL JAIPUR VS. ITO WARD 5(2) JAIPU R 14 CONSIDERATION, IT WOULD BE RELEVANT TO SEE THE SEQUENCE OF TRANSACTION/ EVENTS WHEREBY THE ASSESSEE HAS PURCHAS ED AND SUBSEQUENTLY SOLD THE IMPUGNED PLOT OF LAND: DATE EVENT 4.11 .2009 AGREEMENT BETWEEN ASSES SEE AND S MT. GARIMA AGARWAL FOR SALE OF PLOT OF LAND AT 236, TARU CHHAYA NAGAR TONK ROAD FOR RS. 8,50,000/-. 11.01.2005 AGREEMENT BETWEEN SHRI JAGMOHAN S HARMA AND THE ASSESSEE WHETHER LATT ER PURCHASED THE PLOT OF LAND FOR RS. 7,50,000/- 13.06.1994 THE ALLOTMENT OF PLOT OF LAND BY SUBHASH SINDHI COOPERATIVE HOUSING SOCIETY AT TARU CHHAYA NAGAR, TONK ROAD IN FAVOUR OF SHRI JAGMOHAN SHARMA. 04.02.1991 ACQUISITION OF THE LAND BY RIICO. 20.02.1986 NOTIFICATION FOR ACQUISITION OF LAND BY GOVT. OF RAJASTHAN FOR ACQUIRING THE SAID LAND. 15.04.1975 PURCHASE OF LAND BY SUBHASH SINDHI COOPERATIVE HOUSING SOCIETY FROM SHRI RATAN KUMAR SHARMA AND OTHERS. 3.7 A PER THE LD AR, SHRI RATAN KUMAR SHARMA AND OT HERS FILED A PETITION BEFORE THE HONBLE HIGH COURT AND SUBSEQUENTLY BEFORE THE ITA NO. 15/JP/14 SMT. MRADULA AGARWAL JAIPUR VS. ITO WARD 5(2) JAIPU R 15 HONBLE SUPREME COURT AGAINST THE SAID ACQUISITION OF S UBJECT LAND BY THE STATE GOVT. BUT WITHOUT ANY SUCCESS. IN EFFECT T HE ACQUISITION OF THE LAND BY ISSUE OF NOTIFICATION BY THE STATE GOVT. AND SU BSEQUENT POSSESSION BY RIICO STANDS AS ON DATE. THE LD. AR HAS NOT BROUGHT TO THE NOTICE OF BENCH, ANY FURTHER LITIGATION WHICH IS P ENDING AS ON THE DATE WHEN THE ASSESSMENT PROCEEDINGS WERE COMPLETED. THE FACT THAT EMERGES FROM THE ABOVE IS THAT BY VIRTUE OF NOTIFICATI ON BY THE STATE GOVT. IN THE YEAR 1986 AND SUBSEQUENT ACQUISITION BY RIICO IN THE YEAR 1991, THE RIGHTFUL OWNER OF THE SUBJECT PLOT OF LAND WA S RIICO AND NOT ANY OTHER PERSON. SO IN THE YEAR 2005 WHEN THE ASSESS EE PURCHASED THE SAID PLOT OF LAND FROM SHRI JAGMOHAN SHARMA, THE L ATTER WAS NOT THE RIGHTFUL OWNER OF THE SAID PLOT OF LAND AS THE OWNERSHIP OF THE SAID LAND HAS ALREADY VESTED IN RIICO. ACCORDINGLY, WHERE SH RI JAGMOHN SHARMA WAS NOT THE OWNER OF THE PLOT OF LAND, IT IS UNCLEAR AS TO HOW HE SOLD THE PLOT OF LAND TO THE ASSESSEE AT FIRST PLACE. IN OTHER WORDS, IF SHRI JAGMOHAN SHARMA DOES NOT HAVE THE OWNERSHIP (TITLE AS WELL AS THE POSSESSION) OF THE SAID PLOT OF LAND, HOW CAN HE TRANSFER THE SAME TO ITA NO. 15/JP/14 SMT. MRADULA AGARWAL JAIPUR VS. ITO WARD 5(2) JAIPU R 16 THE ASSESSEE. ON THE SAME ANALOGY, WHERE THE ASSESS EE HERSELF DOES NOT HAVE THE OWNERSHIP OVER THE PLOT OF LAND, HOW CAN SH E TRANSFER THE SAME TO SMT. PREMA AGARWAL. IN LIGHT OF THAT, THE Q UESTION THAT ARISES FOR CONSIDERATION IS WHAT HAS BEEN TRANSFERRED UNDER T HE SUBJECT SALE AGREEMENT WHICH IS THE SUBJECT MATTER OF DISPUTE BEF ORE US. IS IT THE PLOT OF LAND WHICH HAS ALREADY BEEN ACQUIRED BY RIICO OR ANY OTHER RIGHT OVER THE SAID PLOT OF LAND AND BASIS THE SAID DE TERMINATION, WHAT SHOULD BE THE APPROPRIATE VALUE OF SAID CAPITAL ASSET WHICH CAN BE BROUGHT TO TAX. LOOKING AT THE ABOVE FACTS PATTERN, IT APPEARS TO US THAT THE LOWER AUTHORITIES HAVE FAILED TO APPRECIATE THE E NTIRE FACTS AND CIRCUMSTANCES OF THE CASE IN RIGHT PERSPECTIVE. IN OUR CONSIDERED VIEW, GIVEN THE COMPLEXITY AND HISTORY INVOLVED, THE MATTE R REQUIRES A DEEPER EXAMINATION AND IT WOULD BE IN INTEREST OF JUSTICE THA T THE MATTER IS SET- SIDE TO THE FILE OF THE AO WHO SHALL EXAMINE THE SAM E AFRESH AS PER LAW AFTER GIVING REASONABLE OPPORTUNITY TO THE ASSESSEE. T HE AO IS ALSO DIRECTED TO SEEK INFORMATION FROM RIICO AND OTHER RELEV ANT AUTHORITIES TO EXAMINE THE FACTUAL AND LEGAL POSITION AS SUBMITTED BY THE APPELLANT ITA NO. 15/JP/14 SMT. MRADULA AGARWAL JAIPUR VS. ITO WARD 5(2) JAIPU R 17 BEFORE TAKING A FINAL VIEW IN THE MATTER. NEEDLESS TO SAY THE ASSESSEE SHALL COOPERATE IN COMPLETION OF THE PROCEEDINGS IN A TIME BOUND MANNER AS PER DIRECTIONS OF THE LD. AO. HENCE THE GR OUND TAKEN BY THE APPELLANT IS ALLOWED FOR STATISTICAL PURPOSES. IN THE RESULT, THE APPEAL IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 15/12/2015 . SD/- SD/- VKJ-IH-RKSYKUH FOE FLAG ;KNO (R.P.TOLANI) (VIKRAM SINGH YADAV) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER JAIPUR DATED:- 15/12/2015 PILLAI VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT- SMT. MRADULA AGARWAL, JAIPUR 2. THE RESPONDENT- THE ITO, WARD 5(2), JAIPUR 3. THE CIT(A).II, JAIPUR 4. THE CIT-II JAIPUR 5. THE DR, ITAT, JAIPUR 6. GUARD FILE (ITA NO.15/JP/14) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR. ITA NO. 15/JP/14 SMT. MRADULA AGARWAL JAIPUR VS. ITO WARD 5(2) JAIPU R 18 ITA NO. 15/JP/14 SMT. MRADULA AGARWAL JAIPUR VS. ITO WARD 5(2) JAIPU R 19 ITA NO. 15/JP/14 SMT. MRADULA AGARWAL JAIPUR VS. ITO WARD 5(2) JAIPU R 20 ITA NO. 15/JP/14 SMT. MRADULA AGARWAL JAIPUR VS. ITO WARD 5(2) JAIPU R 21 ITA NO. 15/JP/14 SMT. MRADULA AGARWAL JAIPUR VS. ITO WARD 5(2) JAIPU R 22 ITA NO. 15/JP/14 SMT. MRADULA AGARWAL JAIPUR VS. ITO WARD 5(2) JAIPU R 23 ITA NO. 15/JP/14 SMT. MRADULA AGARWAL JAIPUR VS. ITO WARD 5(2) JAIPU R 24 ITA NO. 15/JP/14 SMT. MRADULA AGARWAL JAIPUR VS. ITO WARD 5(2) JAIPU R 25 ITA NO. 15/JP/14 SMT. MRADULA AGARWAL JAIPUR VS. ITO WARD 5(2) JAIPU R 26 ITA NO. 15/JP/14 SMT. MRADULA AGARWAL JAIPUR VS. ITO WARD 5(2) JAIPU R 27 ITA NO. 15/JP/14 SMT. MRADULA AGARWAL JAIPUR VS. ITO WARD 5(2) JAIPU R 28 ITA NO. 15/JP/14 SMT. MRADULA AGARWAL JAIPUR VS. ITO WARD 5(2) JAIPU R 29 ITA NO. 15/JP/14 SMT. MRADULA AGARWAL JAIPUR VS. ITO WARD 5(2) JAIPU R 30 ITA NO. 15/JP/14 SMT. MRADULA AGARWAL JAIPUR VS. ITO WARD 5(2) JAIPU R 31 ITA NO. 15/JP/14 SMT. MRADULA AGARWAL JAIPUR VS. ITO WARD 5(2) JAIPU R 32