The ACIT, Circle-2(1)(2), Ahmedabad V. Mastek Limited, Ahmedabad

ITA 159/AHD/2018

• Counselvise Citation: [2022] 107 COUNSELVISE.COM (IT) 0369 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 year(s) 6 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-08-2022
• Appeal Filed By: Department
• Order Result: PartlyAllowed
• Bench Allotted: D
• Assessment Year: 2011-2012
• Appeal Filed On: 14-01-2018
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Sale consideration of property below Jantri Value; Principle of natural justice; Fair market value
• Section: 147; 143(3)

Judgement Text

आयकर अपीलीय अिधकरण, अहमदाबाद Ɋायपीठ IN THE INCOME TAX APPELLATE TRIBUNAL, ‘’ B” BENCH, AHMEDABAD BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER And Ms. MADHUMITA ROY, JUDICIAL MEMBER आयकर अपील सं./ITA No. 159/AHD/2019 िनधाŊरण वषŊ/Asstt. Year: 2012-2013 Shri Kalpesh Chandulal Patel, 305, Shivalik-5, Nr. Mahalaxmi Char Rasta, Paldi, Ahmedabad. PAN: AEAPP9147H Vs. D.C.I.T., Circle-4(2), Ahmedabad. (Applicant) (Respondent) Assessee by : Shri S.N. Divatia, A.R Revenue by : Shri R.R. Makwana, Sr. DR सुनवाई की तारीख/Date of Hearing : 11/05/2022 घोषणा की तारीख /Date of Pronouncement: 05/08/2022 आदेश/O R D E R PER WASEEM AHMED, ACCOUNTANT MEMBER: The captioned appeal has been filed at the instance of the Assessee against the order of the Learned Commissioner of Income Tax(Appeal)-4, Ahmedabad, dated 18/12/2018 arising in the matter of Assessment Order passed under s. 143(3) r.w.s 263 of the Income Tax Act, 1961 (here-in-after referred to as "the Act") relevant to the Assessment Year 2012-2013. ITA no.159/AHD/2019 Asstt. Year 2012-13 2 2. The assessee has raised the following grounds of appeal: 1.1 The order passed u/s.250 on 18.12.2018 for A.Y.2012-13 by CIT(A)-4, A'bad, upholding the addition towards LTCG of RS. 13,80,500/-is wholly illegal, unlawful and against the principles of natural justice. 1.2 The Ld. CIT(A) has grievously erred in law and or on facts in not considering fully and properly the explanations furnished and the evidence produced by the appellant. 2.1 The Ld. CIT(A) has grievously erred in law and or on facts in upholding the addition towards LTCG of RS. 13.80.500/-. 2.2 That in the facts and circumstances of the case as well as in law, the Ld. CIT(A) ought not to have confirmed addition towards LTCG of RS. 13,80,500/-. 2.3 The Ld. CIT(A) has grievously erred in law and or on facts in upholding the FMV as on the sale deed dated 24.05.2011 u/s.SOC instead of the FMV on the date of first payment by cheque on 12.08.2010. 3.1 The Ld.CIT(A) has grievously erred in law and on facts in upholding the validity of notice u/s.148 and the proceedings u/s.147 though the condition precedent for the same were not satisfied and they were illegal and unlawful. It is therefore prayed that the addition of Rs.13,80,500/- upheld by the CIT(A) should be deleted. 3. The 1 st interconnected issue raised by the assessee in ground No. 1 and 2 is that the learned CIT-A erred in confirming the addition made by the AO for ₹ 13,80,500.00 under the head long-term capital gain. 4. The assessee in the year under consideration has sold the property along with other co-owners for ₹1.10 crores and the share of the assessee in such property was 25% only. Thus the assessee has shown sale consideration of 27,50,000 against which he has declared long-term capital gain of ₹1,82,395.00. However, the sale value of the impugned property was determined by the DVO at ₹ 1,65,22,000.00 and accordingly share of the assessee was down for 41,30,500.00 which has resulted the addition of long-term capital gain in the hands of the assessee at ₹ 13,80,501 only. 5. On appeal, the learned CIT-A confirmed the order of the AO. ITA no.159/AHD/2019 Asstt. Year 2012-13 3 6. Being aggrieved by the order of the learned CIT-A, the assessee is in appeal before us. 7. The learned AR before us filed a paper book running from pages 1 to 141 and contended that 1 st sale consideration was received by the assessee dated 12 August 2010 in pursuance to the agreement of December 2010 for the transfer of impugned property but the actual sale was executed dated 24 May 2011. Thus, it was contended by the learned AR that the date of first payment being 12 August 2010 shall be considered for determining the fair market value of the property in dispute. 8. The learned DR vehemently supported the order of the authorities below. 9. We have heard the rival contentions of both the parties and perused the materials available on record. The Ahmedabad Tribunal in the case of Dharmashi Bhai Sonani versus ACIT reported in 161 ITD 627 has held that the date on which the agreement was entered and part payment was received, then the fair market value as applicable on that date should be adopted. The relevant extract of the order is reproduced as under: Of course, assuming that my understanding of this statutory provision is in harmony with the legislative intention, insertion of words "at the option of the assessee" between "stamp valuation authority on the date of agreement may and be taken for the purposes of computing full value of consideration for such transfer, in first proviso to Section 50C(1), could have made the legal provision even more unambiguous. 9.1 The revenue has not doubted on the contention of the assessee that he has received 1 st payment with respect to the sale of the property as on August 2010. Thus it can safely be concluded that the transaction has actually taken place in that period only. The comparable case of that period shows the sale price at Rs. 1695 per square meter, based on which the sale value of the property of the assessee works out at Rs. 94,00,470.00 whereas the assessee has shown sale price at ₹1.10 crores. Therefore, in our considered view no addition in the given facts and circumstances is warranted. Hence the ground of appeal of the assessee is allowed. ITA no.159/AHD/2019 Asstt. Year 2012-13 4 10. As we have decided the issue raised in the appeal filed by the assessee in favour of the assessee on merit, we do not find any reason to adjudicate the issue raised by the assessee challenging the validity of the assessment framed under section 147 of the Act. Accordingly, we dismiss the ground of appeal of the assessee as infructuous. 11. In the result, the appeal of the assessee is partly allowed. Order pronounced in the Court on 05/08/2022 at Ahmedabad. Sd/- Sd/- (MADHUMITA ROY) (WASEEM AHMED) JUDICIAL MEMBER ACCOUNTANT MEMBER (True Copy) Ahmedabad; Dated 05/08/2022 Manish