KAMU PREMJI RATHOD, MUMBAI V. I.T.O. 20(1)(4), MUMBAI

ITA 1641/MUM/2011

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 79515 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 5 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-07-2014
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: I
• Next Hearing Date: 30-07-2014
• Assessment Year: 2007-2008
• Appeal Filed On: 25-02-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SUMIT KUMAR
• Keywords: Opportunity of being heard; Cost of acquisition; Corroborative evidences; Valuation report
• Section: 54; 144

Judgement Text

, INCOME TAX APPELLATE TRIBUNALMUMBAI BENCH ES I MUMBAI , , ! BEFORE S.SH.VIJAY PAL RAO,JUDICIAL MEMBER AND RAJEN DRA,ACCOUNTANT MEMBER ./ ITA NO.1641/MUM/2011 ' ' ' ' # # # # / ASSESSMENT YEAR 2007-08 ( $% / APPELLANT) ( &'$% / RESPONDENT) '() '() '() '() * * * * / ASSESSEE BY : NONE + * / REVENUE BY : SHRI SUMIT KUMAR ' ' ' ' + ++ + ), ), ), ), / DATE OF HEARING : 30/07/2014 -.# + ), / DATE OF PRONOUNCEMENT : 30/07/2014 PER RAJENDRA,AM ' ' ' ' : CHALLENGING THE ORDER DATED 19.08.2010 OF THE CIT(A )-31,MUMBAI ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE ORDER PASSED U/S 144 OF THE I. T. ACT, 1961, IS INVALID AND BAD IN LAW. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LEARNED C.LT. (A) ERRED IN DISPOSING OF THE APPEAL EX-PARTE WITHOUT GIVING FUL L AND PROPER OPPORTUNITY OF BEING HEARD IN THE MATTER. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LEARNED C.LT. (A) ERRED IN DISPOSING OF THE APPEAL EX-PARTE AND THAT TOO WITHO UT APPRECIATING FULLY AND PROPERLY THE FACTS OF THE CASE. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LEARNED C.LT. (A) ERRED IN HOLDING THAT THE A.O. IS FULLY JUSTIFIED IN PASSING THE EX-PARTE ASSESSMENT ORDER U/S 144 OF THE ACT. 5. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LEARNED C.LT. (A) ERRED IN CONFIRMING THE ENTIRE ADDITION MADE FOR THE COMPUTA TION OF CAPITAL GAINS INCOME AS DISCUSSED IN THE ASSESSMENT ORDER. 6. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW THE LEARNED C.LT. (A) ERRED IN APPROVING THE ACTION OF THE A.O. IN TAKING THE SALE CONSIDERATION FOR THE PURPOSE OF COMPUTATION OF CAPITAL GAINS INCOME AT RS.2, 17,76,000/-. 7. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW THE LEARNED C.LT. (A) ERRED IN APPROVING THE ACTION OF THE A.O IN TAKING THE APPEL LANT'S SHARE OF SALE CONSIDERATION FOR THE PURPOSE OF COMPUTATION OF CAPITAL GAINS INCOME AT R S.43,35,200/-. 8. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LEARNED C.LT. (A) ERRED IN NOT DEALING WITH GROUND NUMBER 4 OF THE APPEAL PERTAINI NG TO DETERMINATION OF INDEXED COST OF ACQUISITION FOR THE PURPOSES OF COMPUTATION OF CAPI TAL GAINS INCOME FULLY AND PROPERLY. 9. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LEARNED C.LT. (A) ERRED IN NOT DEALING WITH GROUND NUMBER 5 OF THE APPEAL PERTAINI NG TO THE WORKING OF LTCG SUBMITTED TO THE A.O. DURING THE COURSE OF HEARING PROCEEDINGS FULLY AND PROPERLY. 10.0N THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LEARNED CIT(A) ERRED IN NOT DEALING WITH GROUND NUMBER 6 OF THE APPEAL PERTAINI NG TO GRANTING OF EXEMPTION U/S 54 OF THE I.T. ACT FULLY AND PROPERLY. THE APPELLANT CRAVES LEAVE TO ADD, ALTER, AMEND OR DELETE ANY OR ALL OF THE GROUNDS OF APPEAL AT KUMARI KAMU PREMJI RATHOD, A - 306, SIDDHIVANAYAK, J.R.BOCHA MARG, OPP. KASTURBE HOSPITAL, MUMBAI-400012 PAN: AABPR3338P VS ITO 20(1 ) (4), PIRAMAL CHAMBERS, PAREL, MUMBAI-400012 ITA NO. 1641/MUM/2011 KUMARI KAMU PREMJI RA THOD 2 ANY TIME. 2.ASSESSEE,AN INDIVIDUAL,FILED HER RETURN OF INCOME ON 07.11.2008 DECLARING TOTAL INCOME OF RS. 1.96 LAKHS.ASSESSING OFFICER(AO) FINALISED THE ASSE SSMENT U/S 144 OF THE ACT ON 29.12.2009 DETERMINING THE INCOME OF THE ASSESSEE AT RS. 42.38 LAKHS.THOUGH THERE ARE SIX GROUNDS OF APPEAL BUT THE EFFECTIVE GROUND OF APPEAL IS ABOUT CONFIRM ING THE ORDER OF THE AO U/S.144 OF THE ACT DURING THE ASSESSMENT PROCEEDINGS,THE AO HAD ISSUED NOTICES TO THE ASSESSEE TO FILE CERTAIN DETAILS.AS PER THE AO,THE ASSESSEE DID NOT FILE COM PLETE DETAILS NOR DID SHE ATTEND NOR SEND HER AUTHORISED REPRESENTATIVE (AR)FOR HEARING.HE FOUND THAT ASSESSEE HAD DECLARED RENTAL INCOME AND INCOME FROM OTHER SOURCES, THAT DURING THE YEAR , SHE HAD SOLD ANNUAL PROPERTY FOR RS.2.17 CRORES. ON 16.12.2009 WHEN THE ASSESSEE'S REPRESENT ATIVE ATTENDED BEFORE THE AO, HE STATED THAT SHE HAD ONLY 1/5 SHARE OF THE PROPERTY. THE AO ESTI MATED THE INDEX COST OF ACQUISITION OF THE PROPERTY AT RS. 4 LAKHS AND LONG TERM CAPITAL GAIN (LTCG) WAS WORKED OUT AS UNDER: SALE CONSIDERATION RS. 2,17,76,000 1/5TH SHARE RS. 43,55,200 LESS: INDEXED COST RS. 4,00,000 LONG TERM CAPITAL GAIN RS. 39,55,200 3 .AGGRIEVED BY THE ORDER OF THE AO,THE ASSESSEE PREF ERRED AN APPEAL BEFORE THE FIRST APPELLATE AUTHORITY(FAA).CASE WAS FIXED FOR HEARING ON 17.06. 2010, 29.07.2010 AND 18.08.2010. AS PER THE FAA ALL THE HEARING NOTICES WERE SERVED UPON TH E ASSESSEE,BUT NOBODY ATTENDED BEFORE HIM NOR ANY REQUEST WAS MADE FOR ADJOURNMENT.THEREFORE, HE DECIDED THE APPEAL ON MERITS ON THE BASIS OF RECORDS AVAILABLE WITH HIM.DURING THE APPELLATE PROCEEDINGS, AS PER THE FAA,THE ASSESSEE DID NOT FILE ANY EXPLANATION/DETAILS OR SUPPORTING EVID ENCES.HER ITP APPEARED BEFORE THE FAA ON 17.06.2010,BUT WRITTEN SUBMISSION WERE NOT FILED. F ROM THE STATEMENTS OF FACTS,THE FAA NOTED THAT SALE CONSIDERATION OF THE IMMOVABLE PROPERTY I N QUESTION WAS STATED TO BE 70 LAKHS AS AGAINST RS. 2.71 CRORES ADOPTED BY THE AO AND THE ASSESSMEN T ORDER. AFTER CONSIDERING THE ASSESSMENT ORDER AND FACTS ST ATED IN THE STATEMENT OF FACTS (FORM NO. 35). FAA HELD THAT THE SALE CONSIDERATION ADOPTED BY THE AO WAS BASED ON THE COPY OF THE SALE AGREEMENT PRODUCED BY THE ASSESSEE, THAT FIGURE APP EARING IN THE SALE AGREEMENT REMAINED UN- REBUTTED,THAT THE ASSESSEE HAD NOT PRODUCED ANY EVI DENCE TO SUPPORT HER CONTENTION THAT THE SALE CONSIDERATION WAS OF RS. 70 LAKHS ONLY AND NOT OF R S. 2.17 CRORES. FINALLY, HE CONFIRMED THE ORDER OF THE AO. WITH REGARD TO INDEXED COST OF PROPERTY AT RS. 4 LA KHS, FAA HELD THAT IN THE STATEMENT OF FACTS AND GROUNDS OF APPEAL,THE ASSESSEE HAD STATED THAT AO H AD FAILED TO NOTE THAT INDEXED COST WAS OF RS. ITA NO. 1641/MUM/2011 KUMARI KAMU PREMJI RA THOD 3 21.01 LAKHS AS PER THE VALUATION REPORT OF THE APPR OVED VALUER.CONSIDERING THE GROUNDS OF APPEAL, STATEMENT OF FACTS AND ASSESSMENT ORDER,THE FAA HEL D THAT THE AO HAD NOT DISCUSSED THE ISSUE IN DETAIL TO ARRIVE AT HIS CONCLUSION OF ESTIMATING TH E COST OF ACQUISITION OF PROPERTY AT RS. 4 LAKHS, THAT THE ASSESSEE HAD NOT FURNISHED THE DETAILS REG ARDING THE COST OF ACQUISITION. HE DIRECTED THE AO TO VERIFY THE CLAIM OF THE ASSESSEE REGARDING TH E ESTIMATION OF INDEXED COST OF ACQUISITION BASED ON THE VALUATION REPORT OF THE APPROVED VALUE R.HE FURTHER DIRECTED THE AO TO VERIFY THE CORRECTNESS OF THE CLAIM OF THE ASSESSEE AND TO DET ERMINE THE CAPITAL GAINS ACCORDINGLY.PARTLY ALLOWING THE APPEAL OF THE ASSESSEE,HE HELD THAT AO WERE NOT JUSTIFIED IN ADOPTING THE INDEXED COST OF ACQUISITION OF RS. 4 LAKHS ON PURE AD-HOC BASIS WITH REGARD TO THE GROUND RAISED BY THE ASSESSEE AB OUT RE-COMPUTING THE LTCG,FAA HELD THAT EVEN AFTER NUMBER OF OPPORTUNITY THE ASSESSEE HAD F AILED TO PRODUCE ANY DETAILS/SUPPORTING EVIDENCES THAT COULD SUBSTANTIATE THE GROUNDS RAISE D BY HER.SUBJECT TO HIS DIRECTIONS GIVEN ABOUT THE COST OF INDEXED, HE DISMISSED THE APPEAL FILED BY THE ASSESSEE. 4. DURING THE COURSE OF HEARING BEFORE US NOBODY APPEA RED.IT IS FOUND THAT HEARING NOTICE WAS SERVED ON THE POSTAL ADDRESS GIVEN BY THE ASSESSEE IN FORM NO. 36. IN THESE CIRCUMSTANCES, WE ARE CONSTRAINED TO DECIDE THE APPEAL ON THE BASIS OF AV AILABLE MATERIAL.AS STATED EARLIER THE MAIN GRIEVANCE OF THE ASSESSEE IS ABOUT CONFIRMATION OF ORDER OF THE AO BY THE FAA,PASSED U/S 144 OF THE ACT.WE FIND THAT THE ASSESSEE DID NOT AVAIL OPP ORTUNITIES BEFORE THE AO OR BEFORE THE FAA TO SUBSTANTIATE THE CLAIM MADE BY HER.THE SALE PROCEED S WERE TAKEN BY THE AO ON THE BASIS OF THE AGREEMENT.ASSESSEE HAD NOT PRODUCED ANY PROOF THAT SALE CONSIDERATION WAS RS. 70 LAKHS AND NOT RS. 2.17 CRORES.IN THESE CIRCUMSTANCES, IN OUR OPIN ION,THE ORDER OF THE FAA DOES NOT SUFFER FROM ANY LEGAL INFIRMITY.WE FURTHER FIND THAT FAA HAD DI RECTED THE AO TO RE-COMPUTE THE INDEXED COST AFTER TAKING INTO CONSIDERATION THE CLAIM MADE BY T HE ASSESSEE. IN OUR OPINION, HIS ORDER IS JUST AND REASONABLE. THEREFORE, UPHOLDING HIS ORDER, WE DECI DED THE GROUND OF APPEAL AGAINST THE ASSESSEE (EFFECTIVE GROUND NO. 1 TO 6) AGAINST THE ASSESSEE. AS A RESULT,APPEAL FILED BY THE ASSESSEE STANDS DIS MISSED. 0)1 '() 2 3 + 4 5) + ) 67. ORDER PRONOUNCED IN THE OPEN COURT ON 30TH JULY, 2014 . 9 + -.# : ;' 30 ,2014 . + 4 B SD/- SD/- ( / VIJAY PAL RAO ) ( / RAJENDRA ) /JUDICIAL MEMBER /ACCOUNTANT MEMBER / MUMBAI, ;' / DATE: 30TH JULY, 2014 ITA NO. 1641/MUM/2011 KUMARI KAMU PREMJI RA THOD 4 S.K. 9 9 9 9 + ++ + &) &) &) &) C#) C#) C#) C#) / COPY OF THE ORDER FORWARDED TO : 1. ASSESSEE / $% 2. RESPONDENT / &'$% 3. THE CONCERNED CIT(A)/ D E , 4. THE CONCERNED CIT / D E 5. DR I BENCH, ITAT, MUMBAI / F4 &)' , . . . 6. GUARD FILE/ 4 0 ') ') ') ') &) &)&) &) //TRUE COPY// 9' / BY ORDER, G / 6 DY./ASST. REGISTRAR , /ITAT, MUMBAI