Dipali Anil Kamthe, Pune V. Income-tax Officer, Ward - 14(4), Pune

ITA 1610/PUN/2018

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 9270 (ITAT-PUNE)
• Duration Of Justice: 5 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-04-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 08-10-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: M K VERMA
• Keywords: Value adopted by valuation officer; Opportunity of being heard; Fair market value; Valuation report; Set aside
• Section: 143(3); 250; 148

Judgement Text

] IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH SMC, PUNE BEFORE MS. SUSHMA CHOWLA, JM AND SHRI ANIL CHATURVEDI, AM . / ITA NO.1610/PUN/2018 / ASSESSMENT YEAR : 2010-11 DIPALI ANIL KAMTHE, S.NO.2163, KAMTHE MALA, AT & POST PHURSUNGI, HAVELI, PUNE 412 308. PAN : BHWPK7498A. . / APPELLANT V/S THE INCOME TAX OFFICER, WARD-14(4), PUNE. . / RESPONDENT . / ITA NO.1611/PUN/2018 / ASSESSMENT YEAR : 2010-11 SHRI ANIL DILIP KAMTHE, S.NO.2163, KAMTHE MALA, AT & POST PHURSUNGI, HAVELI, PUNE 412308. PAN : AMCPK1570H. . / APPELLANT V/S THE INCOME TAX OFFICER, WARD-14(4), PUNE. . / RESPONDENT ASSESSEE BY : NONE. REVENUE BY : SHRI M.K. VERMA. / ORDER PER ANIL CHATURVEDI, AM : 1. THESE TWO APPEALS ARE FILED BY TWO DIFFERENT ASSESSEES E MANATING OUT OF SEPARATE ORDERS OF COMMISSIONER OF INCOME TAX (A) 7, PUNE BOTH DATED 10.07.2018 FOR THE ASSESSMENT YEAR 2010-11. / DATE OF HEARING : 14.03.2019 / DATE OF PRONOUNCEMENT: 02.04.2019 2 ITA NOS.1610 & 1611/PUN/2018 2. BEFORE US, AT THE OUTSET, LD.D.R. SUBMITTED THAT THOUG H THE APPEALS FILED ARE BY TWO DIFFERENT ASSESSEES BUT THE FACTS AND ISSUES INVOLVED IN BOTH THE APPEALS ARE IDENTICAL EXCEPT THE AMO UNTS INVOLVED AND THEREFORE THE SUBMISSIONS MADE BY THEM WHILE ARGUING ONE APPEAL WOULD BE EQUALLY APPLICABLE TO THE OTHER APPEAL ALSO AND T HUS, BOTH THE APPEALS CAN BE HEARD TOGETHER. IN VIEW OF THE AFORESAID SUBMISSIONS OF LD.D.R. WE, FOR THE SAKE OF CONVENIENCE, PROCEED TO DISPOSE OF BOTH THE APPEALS BY A CONSOLIDATED ORDER BUT HOWEVER, PROCEED W ITH NARRATING THE FACTS IN ITA NO.1610/PUN/2018 IN THE CASE OF DIPALI A. KAMTHE. 3. THE RELEVANT FACTS AS CULLED OUT FROM THE MATERIAL ON RE CORD ARE AS UNDER :- ASSESSEE IS AN INDIVIDUAL STATED TO BE HAVING INCOME FROM C APITAL GAINS. AO HAS NOTED THAT FOR A.Y 2010-11 ASSESSEE DID NO T FILE RETURN OF INCOME. AO HAS NOTED THAT INFORMATION WAS RECEIVED FROM D DIT (INV) THAT ASSESSEE ALONG WITH OTHERS HAD SOLD LAND ADMEASURI NG 23.5R AT MAUJE FURSUNGI TO DSK DEVELOPERS AND THE ASSESSEE HAD NOT FILED RETURN OF INCOME DECLARING THE CAPITAL GAINS. ACCORDINGLY, NOTICE U/S 148 OF THE ACT DATED 31.03.2017 WAS ISSUED AND SERVED ON ASSESS EE. IN RESPONSE TO NOTICE, ASSESSEE FILED RETURN OF INCOME DECLARING TOTAL INCO ME OF RS.1,05,357/-. THE CASE WAS CONSEQUENTLY TAKEN UP FOR SC RUTINY AND THEREAFTER THE ASSESSMENT WAS FRAMED U/S 143(3) R.W.S 147 VIDE ORDER DATED 15.12.2017 AND THE TOTAL INCOME WAS DETERMINED AT RS.5,07,754/-. AGGRIEVED BY THE ORDER OF AO, ASSESSEE CARRIED THE MATT ER BEFORE LD.CIT(A), WHO VIDE ORDER DT.10.07.2018 (IN APPEAL NO. PN/CIT (A)-7/WD- 14(4)/10257/2017-18) GRANTED PARTIAL RELIEF TO THE ASSESSEE . AGGRIEVED BY 3 ITA NOS.1610 & 1611/PUN/2018 THE ORDER OF LD.CIT(A), ASSESSEE IS NOW BEFORE US AND HAS RAISED THE FOLLOWING GROUNDS : 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE ASSESSING OFFICER ERRED IN LAW IN PASSING ORDER U/S 147 R.W.S 143(3) AND THE SAME MAY BE QUASHED AS NULL AND VOID & CIT (A)'S ORDER PARTLY CONFIRMING IT SET ASIDE AS BAD IN LAW. 2. THE ASSESSING OFFICER ERRED IN I) ASSUMING JURISDICTION U/S 148 OF THE I.T ACT 196 1. II) PASSING ASSESSMENT ORDER U/S 143(3) OF THE I.T ACT 1961. III) DETERMINING CAPITAL GAIN OF RS 5,07,750/- WITH OUT FOLLOWING DUE PROCESS OF LAW AND SAME MAY BE HELD A S BAD IN LAW AB INITIO. 3. THE LEARNED ASSESSING OFFICER HAS ERRED IN REFER RING THE MATTER TO THE DEPARTMENTAL VALUATION OFFICER. THE REFERENCE CAN BE MADE ONLY WHEN THE VALUE ADOPTED BY THE ASSESSEE WAS LESS THA N THE FAIR MARKET VALUE. 4. WITHOUT PREJUDICE TO ABOVE LEARNED A.O. AND CIT( A) FAILED TO CONSIDER THE EVIDENCE ON RECORD, SUBMISSIONS MADE A ND LEGAL PRONOUNCEMENTS IN COMING TO THE CONCLUSION THAT DIS ALLOWANCE OF PURCHASES IN PART IS WARRANTED AND THIS FINDING MAY BE SET ASIDE AND DIRECTIONS ISSUED TO ACCEPT BOOK RESULTS AND RETURN OF INCOME FILED OR ANY SUITABLE ORDER PASSED TO PRO VIDE RELIEF TO THE APPELLANT. 5. APPELLANT CONTENDS ON MERITS NO ADDITIONS IS WAR RANTED. 4. SIMILAR GROUNDS HAVE BEEN RAISED IN ITA NO.1611/PUN/2 018 IN THE CASE OF ANIL D. KAMTHE. 4.1 ALL THE GROUNDS BEING INTER-CONNECTED ARE CONSIDERED TOGET HER. 5. THE CASE FILE REVEALS THAT ON LAST OCCASION, NONE AT TENDED ON BEHALF OF THE ASSESSEE THOUGH NOTICE WAS SERVED ON ASSE SSEE. ON THE DATE OF PRESENT HEARING ALSO NONE APPEARED ON BEHALF OF THE AS SESSEE NOR WAS ANY ADJOURNMENT APPLICATION FILED. WE THEREFORE PROCEED T O DISPOSE OF 4 ITA NOS.1610 & 1611/PUN/2018 THE APPEAL EX-PARTE QUA THE ASSESSEE BASED ON THE MA TERIAL AVAILABLE ON RECORD AND AFTER HEARING THE LD. D.R. 6. IT WAS NOTICED BY AO THAT ASSESSEE ALONG WITH OTHER FAMILY MEMBERS VIDE AGREEMENT DATED 26.08.2009 HAD SOLD LAND A DMEASURING 23.5R SITUATED AT PHURSUNGI TO DSK DEVELOPERS FOR A CONS IDERATION OF RS. 32,31,250/-. ASSESSEE HAD WORKED OUT THE CAPITAL GAIN ON THE BASIS OF VALUATION REPORT OF REGISTERED VALUER SHRI G L KULKARNI AND HAD TAKEN THE RATE OF RS.175/- PER SQ. MTR. THE VALUATION MADE BY THE ASSESSEE WAS NOT ACCEPTABLE TO AO. HE THEREFORE REFERRED THE MAT TER FOR VALUATION TO VALUATION OFFICER, WHO VALUED THE LAND AT RS.55 PER SQ.MT R. AO THEREAFTER COMPUTED THE CAPITAL GAINS ON THE SALE OF LAND BY TAKING THE VALUE OF LAND AT RS.55/- PER SQ.MTR AND ACCORDINGLY THE C APITAL GAINS WAS WORKED OUT AT RS. 4,02,397/- AND MADE ITS ADDITION. AGGRIEV ED BY THE ORDER OF AO, ASSESSEE CARRIED THE MATTER BEFORE LD.CIT(A), W HO UPHELD THE ORDER OF AO BY HOLDING AS UNDER : 5.3 I HAVE CAREFULLY CONSIDERED THE FACTS OF THE C ASE AND LAW APPARENT FROM RECORDS. THE ASSESSEE HAS SOLD LAND WITH LEGAL HEIRS TO DSK. DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE APPELLANT SUBMITTED VALUATION REPORT FROM MR. G. L. KULKARNI FOR VALUATION OF LAN D AS ON 01.04.1981 WHICH HAS BEEN SOLD TO DSK GROUP. THE AO ALSO OBTAI NED READY RECKNOR RATE FROM JOINT DISTRICT REGISTRAR AND COLLECTOR OF STAMPS. OPPORTUNITY OF BEING HEARD GIVEN TO THE APPELLANT BY THE AO TO DET ERMINE THE VALUATION OF THE LAND AS ON 01.04.1981 WHICH ASSESSEE COMPLIED. THE AO ADOPTED VALUATION OF THE LAND AS ON 01.04.1981 @ 55 PER SQM T. AND COMPUTED CAPITAL GAIN AT RS. 4,02,397/-. 5.4 OSTENSIBLY, THE AO DID NOT AGREE WITH THE VALUA TION REPORT GIVEN BY THE G.L. KULKARNI FOR VALUE OF THE LAND AS ON 01.04.198 1. HE HAS TAKEN VALUE @ RS. 175 PER SQMT. THE AO POINTED OUT DEFECT THAT NO SALE INSTANCE WERE TAKEN INTO CONSIDERATION BY THE VALUER AND NA USE ( NON-AGRICULTURAL) POTENTIAL AS ON IN JANUARY 2016. THE VALUER HAS TAK EN READY RECKNOR RATE AT RS. 250 PER SQMT ON THE BASIS OF 1989 RATE OF RS . 625 PER SQMT. THE AO OBTAINED COLLECTOR RATE FOR STAMP VALUATION @ 40 PE R SQMT. FOR 1989 WHICH WILL COME TO RS. 16 PER SQMT. FOR 1981 ( VALUE OF 1 981 IS TAKEN AS 40% OF VALUE IN 1989 BY VALUER). THE AO REFERRED TO THE DV O FOR VALUATION OF THE LAND ADJOINING THE LAND SOLD AND DVO GAVE SALE INST ANCES FOR SURVEY NOS. IN THE SAME AREA. THE AO COMPUTED CAPITAL GAIN AT R S. 4,02,397/- BY 5 ITA NOS.1610 & 1611/PUN/2018 ADOPTING THE VALUATION AT RS.55 PER SQRNT ON THE BA SIS OF DVO REPORT FOR ADJOINING SURVEY NUMBER. THE APPELLANT COULD NOT BR ING ON RECORD TO CONTROVERT THE FINDINGS OF THE AO AND HOW THE SALE INSTANCES ARE NOT APPLICABLE TO THE APPELLANT. THE APPELLANT ALSO COU LD NOT EXPLAINED THE EXISTENCE OF NA POTENTIAL EVEN IN 1981. THEREFORE, ACTION OF THE AO IN ADOPTING A VALUATION AS ON 01/04/1981 ON THE BASIS OF SALE INSTANCE FOR SURVEY NO.46@ RS. 55 PER SQMT. IS UPHELD. ACCORDING LY, GROUND NO.1 OF THE APPEAL IS DISMISSED. AGGRIEVED BY THE ORDER OF LD.CIT(A), ASSESSEE IS NOW BEFORE US. 7. BEFORE US LD DR SUPPORTED THE ORDER OF LOWER AUTHORITIES. 8. WE HAVE HEARD THE LD.D.R. AND PERUSED THE MATERIAL ON RECORD. THE ISSUE IN THE PRESENT CASE IS WITH RESPECT TO REFERE NCE MADE TO THE DVO IS U/S 55A OF THE ACT. IT IS AN UNDISPUTED FACT TH AT FOR THE PURPOSE OF VALUATION OF THE PROPERTY ASSESSEE HAD GOT THE VALUA TION FROM GOVERNMENT REGISTERED VALUER, WHO DETERMINED THE VALUE OF THE PR OPERTY AS ON 01.04.1981 AT RS.175/- PER SQ.MTR. THE AO DID NO T ACCEPT THE VALUATION MADE BY THE REGISTERED VALUER AND REFERRED THE MATTER TO THE DVO, WHO DETERMINED THE VALUE OF THE IMMOVABLE PROPERTY A S ON 01.04.1981 AT RS.55/- PER SQ.MTR. IT IS THUS SEEN THAT THE VALUE OF PROPERTY DETERMINED BY THE VALUER APPOINTED BY THE AS SESSEE WAS HIGHER THAN THE VALUE DETERMINED BY THE DVO. WE FIND THAT TH E ISSUE OF REFERENCE U/S 55A WAS BEFORE THE HONBLE BOMBAY HIGH CO URT IN THE CASE OF CIT VS. PUJA PRINTS (2014) 360 ITR 697 (BOM). BEFORE T HE HONBLE HIGH COURT REVENUE HAD ARGUED THAT THE AMENDMENT MAD E TO SEC.55A(A) WAS RETROSPECTIVE AND THAT THE AO HAD POWERS U/S 131, 133(C) AND 1 42(2) TO REFER THE MATTER FOR VALUATION. THESE ARGUMENTS DID NOT FIND FAVOUR WITH THE HONBLE HIGH COURT. THE HONBLE BOMBAY HIGH COU RT HAS HELD THAT REFERENCE TO DVO CAN ONLY BE MADE WHEN THE VA LUE ADOPTED BY THE ASSESSEE WAS LESS THAN THE FAIR MARKET VALUE. THE HON BLE JURISDICTIONAL 6 ITA NOS.1610 & 1611/PUN/2018 HIGH COURT HAS FURTHER HELD THAT AMENDMENT TO PROVISO O F SEC.55A(A) IS APPLICABLE ONLY W.E.F. 01.07.2012 AND HAS NO RETROSPECTIVE EFFE CT. BEFORE US, REVENUE HAS NOT PLACED ANY CONTRARY BINDING DECISION IN ITS SUPPORT. WE THEREFORE RELYING ON THE AFORESAID DECISION OF HONBLE B OMBAY HIGH COURT IN THE CASE OF PUJA PRINTS (SUPRA) ARE OF THE VIEW TH AT IN THE PRESENT CASE, AO WAS NOT JUSTIFIED IN MAKING A REFERENCE TO THE D VO AND COMPUTING THE CAPITAL GAINS ON THE BASIS OF VALUE ARRIVED A T BY THE VALUATION OFFICER. WE THEREFORE SET ASIDE THE ORDER OF AO AND THUS THE GROUNDS OF THE ASSESSEE ARE ALLOWED. SINCE WE HAVE ALLOWE D THE GROUND ON MERITS, WE ARE OF THE VIEW THAT THE OTHER GROUNDS RA ISED HAVE BEEN RENDERED ACADEMIC AND THEREFORE REQUIRE NO ADJUDICATION AND THEREFORE THE SAME ARE DISMISSED. 9. IN THE RESULT, THE APPEAL OF ASSESSEE IN ITA NO.16 10/PUN/2018 IS PARTLY ALLOWED. 10. NOW WE TAKE UP APPEAL OF ASSESSEE IN ITA NO.1611/PU N/2018 IN THE CASE OF ANIL D. KAMTHE. 11. BEFORE US LD.D.R. HAS STATED THAT THE FACTS OF THE CASE OF ASSESSEE I.E., DIPALI A. KAMTHE IN ITA NO.1610/PUN/2018 ARE SIMILAR TO THE FACTS OF CASE IN ITA NO.1611/PUN/2018 IN THE CASE OF ANIL D. KAMTHE. WE HAVE HEREINABOVE, WHILE DISPOSING OF THE APPEAL IN CASE OF D IPALI A. KAMTHE IN ITA NO.1610/PUN/2018 SET ASIDE THE ORDER O F AO AND THUS ALLOWED THE GROUND NO.3 OF ASSESSEE AND DISMISSED THE OTH ER GROUNDS BEING ACADEMIC IN NATURE. IN THE PRESENT CASE, SINCE T HE FACTS ARE SIMILAR, WE THEREFORE FOR THE REASONS CITED HEREINABOVE WH ILE DECIDING THE 7 ITA NOS.1610 & 1611/PUN/2018 APPEAL IN CASE OF DIPALI A. KAMTHE (SUPRA) AND FOR SIMILAR REA SONS, ALLOW THE GROUND NO.3 OF ASSESSEE AND DISMISS THE OTHER GROU NDS IN ITA NO.1611/PUN/2018. 12. IN THE RESULT, THE APPEAL OF ASSESSEE IN ITA NO.16 11/PUN/2018 IS PARTLY ALLOWED. 13. TO SUM UP, BOTH THE APPEALS OF ASSESSEES ARE PART LY ALLOWED. ORDER PRONOUNCED ON 2 ND DAY OF APRIL, 2019. SD/- SD/ - ( SUSHMA CHOWLA ) ( ANIL CHATURVEDI ) / JUDICIAL MEMBER ' / ACCOUNTANT MEMBER PUNE; DATED : 2 ND APRIL, 2019. YAMINI #$%&'(' % / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. 4. 5 6. CIT(A)-7, PUNE. PR. CIT-6, PUNE. '#$ %%&',) &', *+ / DR, ITAT, SMC PUNE; $-.// GUARD FILE. / BY ORDER // TRUE COPY // 012%3&4 / SR. PRIVATE SECRETARY ) &' , / ITAT, PUNE.