Balu Vitthal Kharate, Nashik V. Assistant Commissioner of Income-tax, Circle - 1, Nashik

ITA 1596/PUN/2017

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 6076 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 6 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-01-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2011-2012
• Appeal Filed On: 23-06-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Capital asset; Retrospective amendment; Question of law; Cost of acquisition; Fair market value
• Section: 54B; 54F; 2(14); 148; 54; 10

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, PUN E BEFORE SHRI D. KARUNAKARA RAO, AM AND SHRI PARTHA SARATHI CHAUDHURY, JM / ITA NO.1596/PUN/2017 / ASSESSMENT YEAR : 2011-12 BALU VITTHAL KHARATE, H. NO.894/3, GANDHARVAWADI, NEAR FOREST NURSERY CANAL, MAKHMALABAD, NASHIK-422013 PAN : BEYPK5261C ....... / APPELLANT / V/S. THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-1, NASHIK / RESPONDENT / ITA NO.1598/PUN/2017 / ASSESSMENT YEAR : 2011-12 BHIMA DADA KHARATE H. NO.894/3, GANDHARVAWADI, NEAR FOREST NURSERY CANAL, MAKHMALABAD, NASHIK-422013 PAN : BCMPK7951D ....... / APPELLANT / V/S. THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-1, NASHIK / RESPONDENT ASSESSEE BY : SHRI PRAMOD SHINGTE REVENUE BY : SHRI SUDHENDU DAS / DATE OF HEARING : 10.01.2019 / DATE OF PRONOUNCEMENT : 21.01.2019 2 ITA NO. 1596 & 1598/PUN/2017 A.Y.2011-12 / ORDER PER PARTHA SARATHI CHAUDHURY, JM : THESE TWO APPEALS PREFERRED BY THE DIFFERENT ASSESSES EMANATES FROM THE SEPARATE ORDERS OF THE LD. CIT(APPEAL)-1, NASHIK FOR A SSESSMENT YEAR 2011-12 AS PER GROUNDS OF APPEAL ON RECORD. 2. AT THE TIME OF HEARING, THE LD. AR OF THE ASSESSEE FOR THE CASES, APPRAISED THE BENCH THAT FACTS AND CIRCUMSTANCES AND IS SUES ARE COMMON IN BOTH THE CASES. THEREFORE, ITA NO.1596/PUN/2017 MAY BE TAKEN AS LEAD CASE. HENCE, THESE CASES WERE HEARD TOGETHER AND SINCE FACTS COMMON, ISSUES SIMILAR, THESE CASES ARE BEING DISPOSED OF IN THIS CONSOLIDATE D ORDER. WE SHALL TAKE UP THE LEAD CASE IN ITA NO.1596/PUN/2017 FOR BOTH THE ASSESSEES CASES AS PER FOLLOWING GROUNDS OF APPEAL ON RECORD: 1.ON THE BASIS OF FACTS AND IN THE CIRCUMSTANCES O F THE CASE AND AS PER LAW, THE COMMISSIONER OF INCOME TAX (APPEAL)-1, NAS HIK IS NOT JUSTIFIED IN CONFIRMING THE ACTION OF THE AO OF MAKING REFERE NCE FOR VALUATION OF PROPERTY TO THE DVO U/S.55A OF THE ACT. 2. ON THE BASIS OF FACTS AND IN THE CIRCUMSTANCES O F THE CASE AND AS PER LAW, THE ADDITION OF RS.5,02,459/- MADE BY THE AO O N ACCOUNT OF LONG TERM CAPITAL GAIN BY CONFIRMING THE SUBSTITUTION OF THE VALUATION OF DVO AS ON 01.04.1981 AGAINST THE VALUATION ADOPTED BY T HE APPELLANT OF AGRICULTURE LAND SITUATED AT GAT NO.151 MAKHMALBAD, NASHIK. 3. ON THE BASIS OF FACTS AND IN THE CIRCUMSTANCES O F THE CASE AND AS PER LAW, THE COMMISSIONER OF INCOME TAX (APPEAL)-1, NAS HIK IS NOT JUSTIFIED IN CONFIRMING THE DISALLOWANCE MADE BY THE AO ON AC COUNT OF EXEMPTION CLAIMED BY THE APPELLANT U/S.54B OF THE ACT. 4. THE APPELLANT CRAVES FOR ADDITION TO DELETION, A LTERATION, MODIFICATION, CHANGE ANY OF THE GROUNDS. 3. THE BRIEF FACTS IN THIS CASE ARE THAT THE ASSESSEE IS AN INDIVIDUAL AND DERIVES INCOME FROM CAPITAL GAIN, INTEREST, ETC. IT IS OBSERVE D BY THE ASSESSING OFFICER THAT THE ASSESSEE HAD FILED HIS RETURN OF INCOME MAN UALLY IN PAPER FOR 3 ITA NO. 1596 & 1598/PUN/2017 A.Y.2011-12 THE A.Y. 2011-12 ON 19/12/2013 WHICH IS BEYOND DUE DATE FOR FILING RETURN OF INCOME FOR A.Y. 2011-12. THEREAFTER, THE ASSESSING OFFICER ISS UED NOTICE U/S. 148 OF THE ACT ON THE ASSESSEE ON 02/03/2015. ACCORDINGLY, THE ASSESSEE FILED HIS RETURN OF INCOME ON 23/03/2015 IN RESPONSE TO NOTICE ISSUED U/S 148 OF THE ACT DECLARING TOTAL INCOME AT RS. 2,66,030/ - AND OFFERED LONG TERM CAPITAL GAIN AT RS.8,22,717/ -. DURING THE YEAR UNDER CONSIDERATION, THE ASSESSEE ALONG WITH OTHER 5 MEMBERS SOLD AGRICULTURAL LAND SITUATED IN GAT NO. 150 & 151 (I.E. S. NO. 150 OF 39800 SQ. M. AND S. NO. 151 OF 59300 SQ . M.), MAKHMALABAD, NASHIK TO SUYOJIT GROUP FOR TOTAL CONSIDERATIO N OF RS. 48,33,334/ - WHEREIN THE SHARE OF THE ASSESSEE WAS 13.72%. THE SAID LA ND IS SITUATED WITHIN 8 KILOMETERS OF THE MUNICIPAL LIMITS OF NASHIK MUNICIPAL CORPORATION, THE SAME IS A CAPITAL ASSET WITHIN THE MEANING OF SECTION 2(14) OF THE ACT AS SUCH THE GAIN OUT OF SALE OF AGRICULTURE LAND IS CHARGEABLE TO INCOME-TAX. THE SAID LAND WAS ANCESTRAL LAND, THE DEEMED COST OF ACQUISITION WAS TO BE TAKEN THE FAIR MARKET VALUE OF THE SAID LAND AS ON 01/04/1981. THE ASSESSEE TOOK THE COST OF ACQUISITION AT RS.40,10,616/- AS PER THE REPORT OF APPROVED VALUER. THE ASSESSING OFFICER DID NOT ACCEPT THE VALUATION OF THE APPROVED VALUER. FURTHER, THE ASSESSING OFFICER MADE REFERE NCE TO DEPARTMENTAL VALUATION OFFICER TO DETERMINE THE FAIR MARKET VALUE OF THE SAID LAND AS ON 01/04/1981. THE DVO HAS DETERMINED THE VALUATION IS RS.48 PER SQUARE METRE. THE ASSESSING OFFICER COMPLETED ASSESSMENT U/S.143(3) R.W.S147 OF THE ACT DETERMINING TOTAL INCOME OF THE ASSESS EE AT RS.7,50,080/- BY MAKING ADDITION ON ACCOUNT OF LONG TERM CAPITAL GAIN AS PER ADDITIONS/DISALLOWANCE APPEARING IN THE ASSESSING OFFICERS ORDER. 4. THE MATTER, THEREAFTER, TRAVELLED UPTO THE FIRST APPELLA TE AUTHORITY AND THE ASSESSEE HAD FILED DETAILED SUBMISSIONS BEFORE THE LD. CIT(APPEAL). THE LD. CIT(APPEAL) AFTER CONSIDERING THE ASSESSMENT ORDER, SUB MISSIONS OF THE 4 ITA NO. 1596 & 1598/PUN/2017 A.Y.2011-12 ASSESSEE, UPHELD THE ORDER OF ASSESSING OFFICER AND DISMISSE D THE APPEAL OF THE ASSESSEE. 5. BEING AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFORE US BY RAISING GROUNDS AS EXTRACTED IN THE PRECEDING PARAGRAPH. 6. THE LD. AR OF THE ASSESSEE AT THE TIME OF HEARING SU BMITTED THAT THERE ARE THREE GROUNDS OF APPEAL. GROUND NO.1 AND 2 REFERS TO THE SCOPE OF SECTION 55A OF THE ACT REGARDING REFERENCE TO DVO IN CASE OF COS T OF ACQUISITION AS ON 01.04.1981. THE LD. AR SUBMITTED THAT THE HON'BLE JURISDIC TIONAL HIGH COURT IN THE CASE OF CIT VS. POOJA PRINTS, REPORTED AS 360 ITR 697 (BOM.) HAS HELD THAT SUCH REFERENCE CANNOT BE MADE PRIOR TO THE AMENDM ENT TO SECTION 55A OF THE ACT. IN PARA 8 OF THE SAID ORDER HON'BLE COURT SPEC IFIED THAT LAW TO BE APPLIED FOR SECTION 55A SHALL BE AS EXISTING DURING THE RELEV ANT ASSESSMENT YEAR. THE COPY OF THE SAID JUDGMENT IS ENCLOSED AT PAGE 1 TO 3 OF THE LEGAL COMPILATION SUBMITTED BEFORE US. THE LD. AR FURTHER SUBMITTE D THAT FOLLOWING THIS JUDGMENT IN ASSESSEES GROUP CONCERN, THE HON'BLE PUNE ITAT HAS ALSO CONSIDERED THIS REFERENCE AS BEYOND THE POWER OF THE AS SESSING OFFICER, RESPECTIVE ORDERS ARE ATTACHED AT PAGE 4 TO 6, IN CASE OF BHIMA DADA KHARATE FOR ASSESSMENT YEAR 2009-10 AND PAGE 7 TO 19 IN THE C ASE OF ARJUN DADA KHARATE AND PARVATIBAI KHARATE FOR ASSESSMENT YEAR 2009-10. 6.1 THAT WITH REGARD TO THE GROUND NO.3, WE HAD ASKED T HE LD. AR OF THE ASSESSEE TO FURNISH COMPILATION OF DATES IN CASE OF THE ASS ESSEE AS WELL AS IN CASE OF OTHER CASES ON THE ASSESSEE RELIES. THE SAID COM PILATION OF DATES IS AS UNDER: 5 ITA NO. 1596 & 1598/PUN/2017 A.Y.2011-12 6.2 THEREAFTER, THE LD. AR OF THE ASSESSEE SUBMITTED THAT THE SUB-ORDINATE AUTHORITIES HAVE FURTHER DENIED THE EXEMPTION U/S. 54B IN CASE OF ASSESSEE FOR REASON THAT THE ELIGIBLE AGRICULTURE LAND HAS BEEN PURC HASED IN THE NAME OF ASSESSEE ' S SONS. IN THIS REGARD LEARNED ASSESSING OFFICER HAS RELIED UPON JUDGMENT OF HON ' BLE BOMBAY HIGH COURT IN THE CASE OF PRAKASH VS ITA (20 08) 173 TAXMAN 311 (BOM). THE DISTINGUISHING FACTOR IN THIS CASE WITH THAT JUDGMENT IS THAT THE SAID JUDGMENT IS IN THE CONTEXT O F SECTION 54F WHICH APPLIES TO PURCHASE OF NEW HOUSE PROPERTY , WHEREAS THE ASSESSEE HAS RELIED ON THE FOLLOWING JUDGMENTS: I) LAXMI NARAYAN VS. COMMISSIONER OF INCOME TAX, (2018) 89 TAXMANN.COM 334 ( RAJASTHAN) II) COMMISSIONER OF INCOME TAX VS. GURNAM SINGH (2008) 170 TA XMAN 160 ( PUNJAB & HARYANA) III) JAGPAL SINGH VS. INCOME TAX OFFICER (2010) 186 TAXMAN 26 ( DELHI) (MAG.) THE AFORESAID JUDGMENTS EXCLUSIVELY DEALS WITH THE EXEMPT ION U/S.54B OF THE ACT AND IT HAS BEEN HELD BY THESE JUDICIAL PRONOU NCEMENTS THAT SUCH DEDUCTION SHALL BE ALLOWED EVEN IF THE NEW AGRICULTURE LAND IS PURCHASED IN THE NAME OF FAMILY MEMBERS. THE LD. AR OF THE ASSESSEE FUR THER SUBMITTED SR. NO. PARTICULARS APPELLANT HUMAYUN MERCHANT R D PIMPLE 1 ASSESSMENT YEAR 2011-2012 1996-97 2011-1012 2 DUE DATE U/S.139(1) 31/07/2011 31/10/1996 30/09/2011 3 DUE DATE U/S.139(4) 31/03/2013 31/03/1998 30/03/2013 4 INVESTMENT MADE U/S.54B 24/03/2012 01/11/1996 22/08/2012 & 07/08/2012 5 RETURN OF INCOME FILED (ORIGINAL) 19/12/2013 04/11/1996 30/03/2013 6 RETURN OF INCOME FILED U/S.148 25/03/2015 - - 6 ITA NO. 1596 & 1598/PUN/2017 A.Y.2011-12 THAT THE BASIC PURPOSE OF SECTION 54B OF THE ACT WAS TO SUPPORT THE AGRICULTURIST FAMILIES SO TO PROVIDE NEW BOOST IN THEIR LIVELIHOOD. 6.3 THE LD. AR OF THE ASSESSEE FURTHER RELIED ON THE DECIS ION OF THE HON'BLE APEX COURT IN THE CASE OF CIT VS. VEGETABLE PRODUCTS LT D., REPORTED AS 88 ITR 192 WHERE, THE PROPOSITION THAT THE VIEW FAVOURABLE TO TH E ASSESSEE NEED TO BE TAKEN IN THE CASE OF CONFLICTING OPINIONS. 7. ON THE OTHER HAND, THE DR RELIED ON THE ORDERS OF SU B-ORDINATE AUTHORITIES. 8. WE HAVE PERUSED THE CASE RECORD AND CONSIDERED TH E JUDICIAL PRONOUNCEMENTS PLACED BEFORE US IN THE FORM OF PAPER BOO K FILED. WITH REGARD TO GROUND NO. 1 AND 2 REGARDING SCOPE OF SECTION 55A, TW O PROPOSITIONS COME OUT FROM THE JUDGMENTS OF THE HON'BLE COURTS: (I) REFERENCE TO DVO U/S.55A IS TO BE MADE ONLY WHEN VALUE OF PROPERTY DISCLOSED BY ASSESSEE IS LESS THAN THE FAIR MARKET VALUE. I F THE VALUE ADOPTED BY THE ASSESSEE OF THE PROPERTY IS MUCH MORE THAN THE FAIR MARKET VALUE, THERE IS NO QUESTION OF REFERENCE TO DVO. (II) THAT THE AMENDMENT TO SECTION 55A IS EFFECTIVE ONLY FROM 1 ST JULY, 2012 AND THIS AMENDMENT WAS NOT RETROSPECTIVELY APPLICABLE. THE SECOND PROPOSITION OF THE JUDICIAL PRONOUNCEMENT OF T HE HON'BLE COURT IS APPLICABLE IN THE INSTANT CASE. THE PRESENT CASE PERTAINS TO ASSESSMENT YEAR 2011-12 I.E. F.Y. 2010-11 AND THE AMENDM ENT TO SECTION 55A IS BROUGHT INTO EFFECT FROM 1 ST JULY, 2012 I.E. EFFECTIVE FROM ASSESSMENT YEAR 2012-13. 7 ITA NO. 1596 & 1598/PUN/2017 A.Y.2011-12 8.1 WE ALSO FIND THAT IN ITA NO.1582/PUN/2015 FOR THE ASSE SSMENT YEAR 2009-10 IN ASSESSEES GROUP CONCERN, IN THE CASE OF ASS ISTANT COMMISSIONER OF INCOME TAX, CIRCLE-1, NASHIK VS. SHRI BHIMA DADA KHARAT E, THIS ISSUE WAS OBSERVED IN DETAILED AND IT WAS HELD BY THE CO-ORDINATE B ENCH OF THE TRIBUNAL THAT THE APPLICABILITY OF AMENDMENT SO FAR AS SECTION 55A IS CONCERNED, IT CANNOT BE APPLICABLE RETROSPECTIVELY. THE RELEVANT PART O F THE ORDER IS AS UNDER: 11. I 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. I HAVE ALSO CONSIDERED THE VARIOUS DECISIONS CITED BEFORE US. I FIND THE ASSESSEE IN THE INSTAN T CASE HAS SOLD A PIECE OF LAND AND HAS ADOPTED THE FAIR MARKET VALUE OF TH E LAND AS ON 01-04- 1981 ON THE BASIS OF THE REPORT OF THE APPROVED VAL UER WHICH WAS RS.2,80,705/- PER ACRE. THE AO MADE REFERENCE TO T HE DVO WHO VALUED THE FAIR MARKET VALUE AS ON 01-04-1981 AT RS.1,94,8 52/- PER ACRE. SINCE THE FAIR MARKET VALUE ADOPTED BY THE ASSESSEE ON 01 -04-1981 WAS HIGHER THAN THE FAIR MARKET VALUE ADOPTED BY THE DV O, THE AO COMPUTED THE LONG TERM CAPITAL GAIN AT RS.48,18,644/- AS AGA INST RS.4,86,023/- DECLARED BY THE ASSESSEE AS LONG TERM CAPITAL GAIN. I FIND THE LD.CIT(A) VIDE ORDER DATED 14-09-2015 FOLLOWING THE DECISION OF HONBLE BOMBAY HIGH COURT IN THE CASE OF PUJA PRINTS (SUPRA) DELET ED THE ADDITION MADE BY THE AO ON ACCOUNT OF LONG TERM CAPITAL GAIN BY H OLDING THAT THE AO SHOULD NOT HAVE REFERRED THE MATTER TO THE DVO U/S. 55A OF THE I.T. ACT. I FIND SUBSEQUENTLY THE LD.CIT(A), BASED ON THE REQUE ST OF THE AO TO RECTIFY THE ORDER U/S.154, ISSUED NOTICE U/S.154 TO THE ASS ESSEE. SINCE NONE APPEARED ON BEHALF OF THE ASSESSEE AND OBSERVING TH AT THE REFERENCE TO THE DVO IN THE INSTANT CASE WAS MADE BY THE AO AFTE R 01-07-2012, I.E. THE DATE FROM WHICH THE AMENDMENT IN SECTION 55A CA ME INTO OPERATION, UPHELD THE ACTION OF THE AO IN MAKING A REFERENCE T O THE DVO. 12. IT IS THE SUBMISSION OF THE LD. COUNSEL FOR THE ASSESSEE THAT FULL FACTS WERE ALREADY BEFORE THE CIT(A) AS WELL AS BEF ORE THE AO DURING THE REMAND PROCEEDINGS. FURTHER, WHEN THE ASSESSMENT Y EAR INVOLVED IS 2009-10 AND THE AMENDMENT WAS BROUGHT IN THE STATUT E BOOK W.E.F. 01- 07-2012 AND WHEN THE HONBLE BOMBAY HIGH COURT IN T HE CASE OF PUJA PRINTS (SUPRA) HAS ALREADY HELD THAT SUCH AMENDMENT BROUGHT TO THE STATUTE IS NOT RETROSPECTIVE, THEREFORE, WHETHER A REFERENCE CAN BE MADE TO THE DVO AFTER 01-07-2012 FOR AN ASSESSMENT YEAR PRIOR TO A.Y. 2012- 13 IS A HIGHLY DEBATABLE ISSUE. 13. I FIND MERIT IN THE ABOVE SUBMISSION OF THE LD. COUNSEL FOR THE ASSESSEE. ADMITTEDLY, THE ASSESSEE HAS MADE ELABOR ATE SUBMISSION DURING THE APPELLATE PROCEEDINGS WHICH HAS ALREADY BEEN REPRODUCED AT PARA 8 OF THIS ORDER. THE LD.CIT(A) HAS CALLED FOR A REMAND REPORT FROM THE AO BY FORWARDING THE SUBMISSION AND THE AO HAS NOT COMMENTED UPON THIS ISSUE. 14. IT HAS BEEN HELD IN VARIOUS DECISIONS THAT ONCE THE COMMISSIONER (APPEAL) HAS RECORDED HIS FINDINGS FOR OR AGAINST T HE ASSESSEE THE 8 ITA NO. 1596 & 1598/PUN/2017 A.Y.2011-12 COMMISSIONER (APPEAL) IS NOT COMPETENT TO REVIEW ITS OWN ORDER ON THE BASIS OF SAME FACTS IN GARB OF POWERS VESTED U/S.15 4 OF THE I.T. ACT. ALL ISSUES WHICH INVOLVE PROLONGED ARGUMENTS AND ARE DE BATABLE AND WHERE TWO VIEWS ARE POSSIBLE FALL OUTSIDE THE SCOPE OF TH E POWERS U/S.154 OF THE I.T. ACT. 15. I FIND THE HONBLE BOMBAY HIGH COURT IN THE CAS E OF PUJA PRINTS (SUPRA) AT PARA 8 OF THE ORDER HAS OBSERVED AS UNDE R : 8. THE CONTENTION OF THE REVENUE THAT IN VIEW OF THE AMENDMENT TO SECTION 55A(A) OF THE ACT IN 2012 BY W HICH THE WORDS 'IS LESS THAN THE FAIR MARKET VALUE' IS SUBST ITUTED BY THE WORDS ' 'IS AT VARIANCE WITH ITS FAIR MARKET VALUE' IS CLARIFACTORY AND SHOULD BE GIVEN RETROSPECTIVE EFFECT. THIS SUBM ISSION IS IN FACE OF THE FACT THAT THE 2012 AMENDMENT WAS MADE E FFECTIVE ONLY FROM 1 JULY 2012. THE PARLIAMENT HAS NOT GIVEN RETR OSPECTIVE EFFECT TO THE AMENDMENT. THEREFORE, THE LAW TO BE A PPLIED IN THE PRESENT CASE IS SECTION 55A(A) OF THE ACT AS EXISTI NG DURING THE PERIOD RELEVANT TO THE ASSESSMENT YEAR 2006-07. AT THE RELEVANT TIME, VERY CLEARLY REFERENCE COULD BE MADE TO DEPAR TMENTAL VALUATION OFFICER ONLY IF THE VALUE DECLARED BY THE ASSESSEE IS IN THE OPINION OF ASSESSING OFFICER LESS THAN ITS FAIR MARKET VALUE. 16. ONCE IT IS HELD BY THE JURISDICTIONAL HIGH COUR T THAT SUCH AMENDMENT TO PROVISIONS OF SECTION 55A(A) IS NOT RE TROSPECTIVE AND PROSPECTIVE, THEREFORE, MERELY BECAUSE THE AO HAS M ADE A REFERENCE TO THE DVO AFTER THE DATE OF SUCH AMENDMENT FOR AN ASS ESSMENT YEAR PRIOR TO THE AMENDMENT IS A HIGHLY DEBATABLE ISSUE. THE HONBLE SUPREME COURT IN THE CASE OF T.S. BALARAM, ITO VS. VOLKART BROTHERS AND OTHERS REPORTED IN 82 ITR 50 HAS HELD THAT A MISTAKE APPAR ENT ON THE RECORD MUST BE AN OBVIOUS PATENT MISTAKE AND NOT SOMETHING WHICH CAN BE ESTABLISHED BY A LONG RUN PROCESS OF REASONING ON P OINTS ON WHICH THERE MAY BE CONCEIVABLY TWO OPINIONS. A DECISION ON A D EBATABLE POINT OF LAW IS NOT A MISTAKE APPARENT FROM THE RECORD. SINCE I N THE INSTANT CASE THE ISSUE AS TO WHETHER THE AO CAN MAKE A REFERENCE TO THE DVO U/S.55A(A) OF THE I.T. ACT AFTER THE AMENDMENT BROUGHT IN THE STATUTE BOOK W.E.F. 01- 07-2012 BUT FOR AN ASSESSMENT YEAR PRIOR TO THAT DA TE WHERE THE FAIR MARKET VALUE ADOPTED BY THE ASSESSEE AS ON 01-04-19 81 IS MORE THAN THE FAIR MARKET VALUE DETERMINED BY THE AO IS A HIG HLY DEBATABLE ISSUE, THEREFORE, FOLLOWING THE DECISION OF HONBLE SUPREM E COURT IN THE CASE OF T.S. BARALAM, ITO VS. VOLKART BROTHERS AND OTHERS ( SUPRA) I HOLD THAT THE CIT(A) WAS NOT JUSTIFIED IN PASSING THE ORDER U/S.1 54 OF THE I.T. ACT IN THE INSTANT CASE WHICH IN MY OPINION IS A HIGHLY DEBATA BLE ISSUE. ACCORDINGLY, I SET ASIDE THE ORDER OF THE CIT(A) PA SSED THE ORDER U/S.154 OF THE I.T. ACT. GROUNDS RAISED BY THE ASSESSEE AR E ACCORDINGLY ALLOWED. RESPECTFULLY, FOLLOWING THE AFORESAID JUDICIAL PRONOUNCEMENT, W E SET ASIDE THE ORDER OF THE LD. CIT(APPEAL) AND ALLOW THE GROUND NO. 1 AND 2 RAISED IN APPEAL BY THE ASSESSEE . 9 ITA NO. 1596 & 1598/PUN/2017 A.Y.2011-12 9. WITH REGARD TO THE GROUND NO. 3, WE FIND THAT EXEMPTIO N U/S.54B OF THE ACT IN THE CASE OF ASSESSEE WAS NOT ALLOWED BY THE REVE NUE AUTHORITIES. SINCE THE LAND WAS PURCHASED IN THE NAME OF THE ASSESSEES SON. NOW IT HAS TO BE EXAMINED AS PER JUDICIAL PRONOUNCEMENTS WHETHER EXEMPTIO N/S.54B OF THE ACT CAN BE ALLOWED EVEN IF THE NEW AGRICULTURAL LAND IS PURC HASED IN THE NAME OF FAMILY MEMBERS. IN THE CASE OF LAXMI NARAYAN VS. COMMISSIONER OF INCOME TAX (SUPRA.), THE HON'BLE RAJASTHAN HIGH COURT DEALT WITH THE S AME ISSUE WHEREIN ASSESSEE SOLD AN AGRICULTURAL LAND AND OUT OF SALE PROCEED S PURCHASED ANOTHER AGRICULTURAL LAND IN THE NAME OF HIS WIFE. HE CLAIMED DEDUCTION U/S.54B OF THE ACT BUT SAME WAS DISALLOWED AS LAND WAS PU RCHASED BY ASSESSEE IN THE NAME OF HIS WIFE. THE QUESTION WAS WHETHE R THE ASSESSEE HAD INVESTED SALE PROCEEDS OF AGRICULTURAL LAND IN PURCHASE OF N EW LAND, THE ASSESSEE COULD NOT BE DENIED DEDUCTION U/S.54B SINCE THE NEW PROPERTY WAS NOT IN HIS NAME BUT IN THE NAME OF HIS WIFE. THE HON'BLE RA JASTHAN HIGH COURT OBSERVED THAT THE CONTENTIONS WHICH HAVE BEEN R AISED BY THE DEPARTMENT ARE THAT THE INVESTMENT HAS TO BE MADE BY THE ASSESSEE IN HIS OWN NAME BUT THE LEGISLATURE HAS NOT USED SPECIFIC LANGUA GE WITH PRECISION AND THE HON'BLE DELHI HIGH COURT IN CIT VS. KAMAL WAHAL RE PORTED AS 351 ITR 4 HAS ALSO HELD THAT IT CAN BE IN THE NAME OF WIFE. IN THAT VIEW OF THE MATTER CONTENTION RAISED BY THE ASSESSEE IS REQUIRED TO BE ACCEPTED WITH REGARD TO SECTION 54B REGARDING INVESTMENT. IN THE CASE OF COMMISSIONER OF INCOME TAX VS. GURNAM SINGH (SUPRA.) , THE HON'BLE PUNJAB & HARYANA HIGH COURT HELD WHEREIN TH E ASSESSEE SOLD AN AGRICULTURAL LAND AND OUT OF SALE PROCEEDS PURCHASE ANOTH ER AGRICULTURAL LAND IN HIS NAME AND IN NAME OF HIS ONLY SON, HE CLAIMED DEDUCTIO N U/S.54B, BUT 10 ITA NO. 1596 & 1598/PUN/2017 A.Y.2011-12 THE SAME WAS DISALLOWED BY THE ASSESSING OFFICER ON GROU ND THAT LAND WAS PURCHASED BY ASSESSEE IN THE NAME OF HIS SON AS CO-OW NER. THE HON'BLE PUNJAB & HARYANA HIGH COURT FURTHER OBSERVED THAT NO SUBSTANTIAL QUESTION OF LAW ARISES FOR CONSIDERATION SINCE THE TRIBUNAL HAS RECOR DED FINDINGS AND DISMISSED THE APPEAL OF THE REVENUE. THE HON'BLE HIGH COUR T HAS HELD THAT THE ASSESSEE HAD SOLD AGRICULTURAL LAND WHICH WAS USED BY HIM FOR AGRICULTURAL PURPOSES. OUT OF SALE PROCEEDS OF THE SAID SALE , THE ASSESSEE HAS PURCHASED OTHER PIECE OF LAND IN HIS NAME AND IN THE NAME OF HIS ONLY SON WHO WAS BACHELOR AND WAS DEPENDENT UPON HIM, FOR BEING U SED FOR AGRICULTURAL PURPOSES WITHIN THE STIPULATED TIME. FURTHER IT WAS NOT THE CASE OF THE REVENUE THAT FROM THE SALE PROCEEDS OF THE AGRICU LTURAL LAND EARLIER OWNED BY THE ASSESSEE, THE LAND IN QUESTION WAS PURCHAS ED FOR ANY OTHER PURPOSE THAN THE AGRICULTURAL PURPOSE. THE PURCHASED LAND WAS BEING USED BY THE ASSESSEE FOR AGRICULTURAL PURPOSE AND MERELY BEC AUSE IN THE SALE DEED HIS ONLY SON WAS ALSO SHOWN AS CO-OWNER, THE HON'BLE IT AT HAS RIGHTLY COME TO THE CONCLUSION THAT IT DOES NOT MAKE ANY DIFFERENCE BE CAUSE THE PURCHASED LAND IS BEING USED BY THE ASSESSEE FOR AGRICULTURAL PURPOSES. 10. ON THE OTHER HAND, LD. DR DID NOT BRING OUT ANY EV IDENCE ON RECORD TO DEMONSTRATE THAT THE SAID LAND OF THE ASSESSEE WAS US ED FOR ANY OTHER PURPOSE OTHER THAN AGRICULTURAL PURPOSE. THE ASSESSING OFFICER REFERRED TO THE JUDGMENT OF HON'BLE BOMBAY HIGH COURT IN THE CASE OF PR AKASH VS. ITO (SUPRA.) BUT THE FACTS ARE SUBSTANTIALLY DIFFERENT FROM THE C ASE OF THE ASSESSEE IN HAND. FURTHER, WE HAVE ALSO CONSIDERED THE DECISION IN T HE CASE OF CIT VS. VEGETABLES PRODUCTS LTD. (SUPRA.), THEREIN THE VIEW ALSO FA VORABLE TO THE ASSESSEE THAT HAS TO BE TAKEN, IN CASE OF CONFLICTING OPINIONS. 11 ITA NO. 1596 & 1598/PUN/2017 A.Y.2011-12 11. THAT ON ENTIRE EXAMINATION OF THE JUDICIAL PRONOUNCEM ENTS AND FACTS ON RECORD, WE SET ASIDE THE ORDER OF THE LD. CIT(APPEAL) AND ALLOW THE GROUND NO. 3 RAISED IN APPEAL BY ASSESSEE . 12. IN THE COMBINED RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED ON 21 ST DAY OF JANUARY, 2019. SD/- SD/- D. KARUNAKARA RAO PARTHA SARAT HI CHAUDHURY ACCOUNTANT MEMBER JUDICIAL MEMBER / PUNE; / DATED : 21 ST JANUARY, 2019. SB !'#$%&%# / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT. 2. / THE RESPONDENT. 3. THE CIT(APPEAL)-1, NASHIK. 4. THE PR. CIT-1, NASHIK. 5. '#$ %%&' , ( &' , )*+ , / DR, ITAT, B BENCH, PUNE. 6. $,- ./ / GUARD FILE. // TRUE COPY // (0 / BY ORDER, %1 &+ / PRIVATE SECRETARY ( &' , / ITAT, PUNE. 12 ITA NO. 1596 & 1598/PUN/2017 A.Y.2011-12 DATE 1 DRAFT DICTATED ON 11 .01.2019 SR.PS/PS 2 DRAFT PLACED BEFORE AUTHOR 11 .01 .201 9 SR.PS/PS 3 DRAFT PROPOSED AND PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER AM/JM 5 APPROVED DRAFT COMES TO THE SR. PS/PS SR.PS/PS 6 KEPT FOR PRONOUNCEMENT ON SR.PS/PS 7 DATE OF UPLOADING OF ORDER SR.PS/PS 8 FILE SENT TO BENCH CLERK SR.PS/PS 9 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK 10 DATE ON WHICH FILE GOES TO THE A.R 11 DATE OF DISPATCH OF ORDER