Sayyad Wajed Sayyad Mehboob, Aurangabad V. Income-tax Officer,

ITA 1656/PUN/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 0491 (ITAT-PUNE)
• Duration Of Justice: 3 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-11-2016
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 01-08-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SUMITRA BANERJI
• Keywords: Gift; Additional evidence; Cost of acquisition; Reassessment proceedings
• Section: 148; 54

Judgement Text

- IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH SMC , PUNE , BEFORE MS. SUSHMA CHOWLA, JM . / ITA NO. 1655 /PN/201 6 / ASSESS MENT YEAR : 20 1 0 - 11 SHRI SAYYAD JAVED SAYYAD MEHBOOB, H.NO.4 - 11 - 44, MAQSOOD COLONY, ROSHAN GATE, AURANGABAD . / APPELLANT PAN: CTRPS3655M VS. THE INCOME TAX OFFICER , WARD 2 ( 3 ), AURANGABAD . / RESPONDENT . / ITA NO. 165 6 /PN/201 6 / ASSESSMENT YEAR : 20 10 - 11 SHRI SAYYAD WAJED SAYYAD MEHBOOB, H.NO.4 - 11 - 44, MAQSOOD COLONY, ROSHAN GATE, AURANGABAD . / APPELLANT PAN: CTRPS365 6J VS. THE INCOME TAX OFFICER, WARD 2(3), AURANGABAD . / RESPONDENT / APPELLANT BY : NONE / RESPONDENT BY : SMT. SUMITRA BANERJI / DATE OF HEARING : 0 5 . 1 0 .201 6 / DATE OF PRONOUNCEMENT: 11 . 1 1 .201 6 ITA NO S . 1655 & 1656 /PN/20 1 6 SHRI SAYYAD JAVED SAYYAD MEHBOOB & ANR. 2 / ORDER PER SUSHMA CHOWLA, J M : BOTH THE APPEAL S FILED BY RELATED ASSESSEE ARE AGAINST SEPARATE ORDER S OF CIT (A) - 2 , AURANGABAD , BOTH DATED 13 . 0 5 .20 1 6 RELATING TO ASSESSMENT YEAR 20 1 0 - 11 AGAINST RESPECTIVE ORDER S PASSED UNDER SECTION 1 4 3(3) R.W.S. 14 7 OF THE INCOME - TAX ACT , 1961 (IN SHORT THE ACT) . 2. BOTH THE APPEALS RELATING TO RELATED ASSESSEE ON IDENTICAL ISSUE WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE. HOWEVER, REFERENCE IS BEING MADE TO THE FACTS IN ITA NO.1655/PN/2016 TO ADJUDICATE THE ISSUE. 3 . THE ASSESSEE IN ITA NO.1655/PN/2016 HAS RAISED THE FOLLOWING GROUNDS OF APPEAL : - 1. THAT THE ORDER OF THE LEARNED INCOME TAX OFFICER, WARD 2(3), AURANGABAD AS WELL AS THE ORDER OF THE LEARNED CO MMISSIONER OF INCOME TAX (APPEALS) - 2, AURANGABAD ARE BOTH WRONG ON FACTS AND BAD IN LAW. 2. THAT THE INCOME TAX OFFICER HAS ERRED IN NOT ALLOWING THE INDEXED COST OF THE PROPERTY SOLD AND THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) - 2, HAS ALSO ERRED IN ACCEPTING THE DECISION OF THE INCOME TAX OFFICER ON THE BASIS OF INCOMPLETE AND AMBIGUOUS REMAND REPORT OF THE INCOME TAX OFFICER. 3. THE INCOME TAX OFFICER AS WELL AS THE COMMISSIONER OF INCOME TAX (APPEALS), AURANGABAD BOTH HAVE ERRED IN TAKING THE C OST OF ACQUISITION OF THE PROPERTY OF ANOTHER BROTHER WHO ALSO SOLD HIS PROPERTY AND CLAIMED EXEMPTION IN HIS CASE. THAT THE ASSESSING OFFICER AND THE CIT(A) HAVE ERRED IN NOT CONSIDERING THE PROPERTY OF THE APPELLANT FOR ALLOWING COST OF ACQUISITION. 4 . BOTH APPEAL S W ERE FIXED FOR HEARING ON 08.09.2016, WHICH W ERE ADJOURNED AT THE REQUEST OF THE COUNSEL AND THE PARTIES WERE INFORMED IN THE OPEN COURT. HOWEVER, ON THE APPOINTED DATE OF HEARING ON 05.10.2016 , NONE APPEARED ON BEHALF OF THE ASSESSEE AND H ENCE, IT IS PROCEEDED TO DECIDE THE ITA NO S . 1655 & 1656 /PN/20 1 6 SHRI SAYYAD JAVED SAYYAD MEHBOOB & ANR. 3 PRESENT APPEALS AFTER HEARING THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE . 5. THE ONLY ISSUE ARISING IN THE PRESENT SET OF APPEALS IS AGAINST THE ADOPTION OF COST OF ACQUISITION OF THE PROPERTY. 6. BRIEFLY, IN THE FACTS OF THE CASE, THE ASSESSEE HAD PURCHASED COMMERCIAL PROPERTY VIDE REGISTERED SALE DEED DATED 28.01.2010 FOR ACTUAL CONSIDERATION OF RS. 45,96,000/ - , MARKET VALUE OF RS. 52,68,000/ - . AFTER INCLUDING THE REGISTRATION CHARGES AND STAMP DUTY TOTALI NG RS. 2,93,720/ - , THE ACTUAL COST OF PROPERTY WAS TAKEN TO BE RS.48,89,720/ - . THE ASSESSEE HAD PURCHASED THE SAID PROPERTY ALONG WITH HIS TWO BROTHERS AND THE DETAILS OF PAYMENTS MADE BY EACH ONE OF THEM ARE TABULATED AT PAGE 1 OF THE ASSESSMENT ORDER TOT ALING RS.45,96,000/ - . THE ASSESSING OFFICER NOTED THAT THE SHARE OF ASSESSEE WAS 61% AT RS.28,21,000/ - . FURTHER, CHARGES SPENT FOR TRANSFER OF PROPERTY WERE TO THE TUNE RS.28,21,000/ - . FURTHER, CHARGES SPENT FOR TRANSFER OF PROPERTY WERE TO THE TUNE OF RS. 2,93,720/ - AND THE ASSESSEES SHARE WAS RS. 1,79,169/ - . THUS, ASSESSEES SHARE IN THE COST OF PROPERTY WAS RS. 30,00,169/ - . THE ASSESSEE SAID TO HAVE SOLD RESIDENTIAL HOUSE CUM COMMERCIAL SHOP AT AURANGABAD VIDE REGISTERED SALE DEED DATED 31.07.2009 FOR CONSIDERATION OF RS.29,50,000/ - . THE ASSESSING OFFICER NOTED THAT THE PROPERTY S OLD BY THE ASSESSEE WAS COMMERCIAL SHOP PLUS RESIDENTIAL HOUSE, WHEREAS THE PROPERTY PURCHASED WAS COMMERCIAL PROPERTY, AGAINST WHICH THE DEDUCTION UNDER SECTION 54 OF THE ACT WAS NOT AVAILABLE. THE ASSESSEE HAS FAILED TO FURNISH THE RETURN OF INCOME SHOW ING LONG TERM CAPITAL GAINS AND CONSEQUENTLY, REASSESSMENT PROCEEDINGS WERE INITIATED AGAINST THE ASSESSEE AND NOTICE UNDER SECTION 148 OF THE ACT WAS ISSUED. 7. DURING THE COURSE OF HEARING, THE ASSESSEE POINTED OUT THAT IT HAD FURNISHED THE RETURN OF INCOME ON 28.03.2012, WHEREIN CAPITAL GAINS WERE ITA NO S . 1655 & 1656 /PN/20 1 6 SHRI SAYYAD JAVED SAYYAD MEHBOOB & ANR. 4 SHOWN AND EXEMPTION UNDER SECTION 54 OF THE ACT WAS CLAIMED AT RS.11,82,000/ - AS AGAINST SALE OF PROPERTY AT RS.11,82,000/ - . THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE WAS ASKED TO FILE COPY OF THE PURCHASE DEED OF THE SAID PROPERTY IN ORDER TO VERIFY THE CORRECTNESS OF THE CLAIM MADE UNDER SECTION 54 OF THE ACT. THE CASE OF THE ASSESSEE WAS FIXED ON VARIOUS DATES BUT ADJOURNMENT WAS SOUGHT ON ONE PRETEXT OR THE OTHER. THEREAFTER, THE ASSESSEE PRODUCED THE CIVIL COURTS ORDER DATED 24.09.1998 FROM WHICH IT WAS CLEAR THAT THE PROPERTY WHICH WAS SOLD BY HIM WAS ACQUIRED BY WAY OF GIFT FROM HIS FATHER. THE ASSESSEE WAS ASKED TO PRODUCE THE PURCHASE DEED OF THE PREVIOUS OWNER OF THE SAID PROPERTY, IN RESPONSE TO WHICH, THE PURCHASE DEED DATED 05.11.1986 WAS FILED, UNDER WHICH THE FATHER OF ASSESSEE HAD PURCHASED THE SAID PROPERTY WHICH WAS GIFTED TO THE ASSESSEE AND HIS SHARE WAS ADOPTED AT RS.36,000/ - . IN RESPECT OF THE CLAIM UNDER SECTION 54 OF T HE ACT, THE ASSESSEE HAS PURCHASED ANOTHER RESIDENTIAL CUM SECTION 54 OF T HE ACT, THE ASSESSEE HAS PURCHASED ANOTHER RESIDENTIAL CUM COMMERCIAL PROPERTY. THE VALUE OF RESIDENTIAL AREA PLUS PLOT PURCHASED WAS WORKED OUT AT RS.21,12,000/ - AND THE PROPERTY VALUE ELIGIBLE FOR EXEMPTION UNDER SECTION 54 OF THE ACT WAS TAKEN AT RS. 19 ,60,343/ - , IN WHICH ASSESSEES SHARE WAS RS.11,95,809/ - . THE TAXABLE GAIN IN THE CASE OF ASSESSEE WORKED OUT TO RS.17,00,020/ - . THE SAID CALCULATION WAS CONFRONTED TO THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE, WHO CONSENTED FOR THE ADDITION BUT STRONGLY ARGUED THAT SINCE THE ASSESSEE HAD ALREADY SHOWN THE SAID TRANSACTION IN THE RETURN OF INCOME MERE RESTRICTION OF EXEMPTION UNDER SECTION 54 OF THE ACT DOES NOT AMOUNT TO EITHER CONCEALMENT OR FURNISHING OF INACCURATE PARTICULARS OF INCOME. 8 . BEFORE THE CIT(A), THE FIRST GROUND OF APPEAL RAISED BY THE ASSESSEE WAS THAT IT HAD NOT BEEN GRANTED PROPER OPPORTUNITY. THE CIT(A) VIDE PARA 5 NOTES THE VARIOUS OPPORTUNITIES ALLOWED TO THE ASSESSEE AND WAS OF THE VIEW THAT ITA NO S . 1655 & 1656 /PN/20 1 6 SHRI SAYYAD JAVED SAYYAD MEHBOOB & ANR. 5 SUFFICIENT OPPORTUNITIES W ERE GIVEN WHICH WERE NOT COMPLIED WITH BY THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE. HOWEVER, IN THE INTEREST OF JUSTICE , THE ASSESSEE WAS ALLOWED TO PRESENT HIS CASE DURING THE COURSE OF APPELLATE PROCEEDINGS. THE ASSESSEE CLAIMED THAT IT W AS PREVENTED FROM FILING THE DOCUMENTS IN RELATION TO COST OF IMPROVEMENT AND ADDITION TO THE PROPERTY . THE ASSESSEE CLAIMED THAT IT HAD INCURRED EXPENSES OF RS. 8,81,798/ - IN FINANCIAL YEAR 1999 - 2000 AND RS. 5,48,785/ - IN FINANCIAL YEAR 2000 - 01. THE ASSES SEE SUBMITTED COMMENCEMENT CERTIFICATE ISSU ED BY THE MUNICIPAL CORPORATION, AURANGABAD DATED 03.05.1999 AND ONLY FILED TWO BILLS OF RS. 4,080/ - AND RS.28,192/ - , DATED 12.06.1999 AND 20.08.1999 RESPECTIVELY . THE SAID SUBMISSIONS WERE REMANDED TO THE ASSESSI NG OFFICER FOR VERIFICATION OF ADDITIONAL EVIDENCE . I N THE REMAND REPORT DATED 10.02.2016 , T HE ASSESSING OFFICER STATED THAT OPPORTUNITY WAS GIVEN TO THE ASSESSEE VIDE LETTER DATED 09.12.2015. HOWEVER, NEITHER THE ASSESSEE ATTENDED NOR ANY EVIDENCE WAS 09.12.2015. HOWEVER, NEITHER THE ASSESSEE ATTENDED NOR ANY EVIDENCE WAS P RODUCED IN SUPPORT OF ADDITIONAL CLAIM FILED IN THE APPELLATE PROCEEDINGS. THUS, IT WAS REPORTED THAT THE CLAIM OF EXPENSES INCURRED ON CONSTRUCTION AND REPAIR OF BUILDING WERE BASELESS AND MISLEADING. THE REMAND REPORT WAS FORWARDED TO THE ASSESSEE BY T HE CIT(A) VIDE LETTER DATED 15.02.2016. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE ATTENDED ON THE APPOINTED DATE I.E. 08.03.2016. HOWEVER, HE DID NOT SUBMIT ANY REJOINDER OR ANY COMMENTS TO THE REMAND REPORT. THE CIT(A) IN SUCH CIRCUMSTANCE S HELD THAT THE ASSESSEE HAD NOT BEEN ABLE TO SUBSTANTIATE HIS CLAIM OF MAKING ADDITIONS / IMPROVEMENTS TO THE PROPERTY AND HENCE, THE CLAIM OF ASSESSEE WAS REJECTED. 9 . THOUGH THE ASSESSEE HAD FILED AN APPEAL BEFORE THE TRIBUNAL IN THIS REGARD AND HAS AL SO RAISED AN ISSUE OF ADOPTION COST OF ACQUISITION OF THE PROPERTY BUT THE ASSESSEE HAS FAILED TO FURNISH ANY EVIDENCE EXCEPT FOR THE CLAIM THAT IT HAD INCURRED EXPENDITURE ON CONSTRUCTION. ADMITTEDLY, THE SAID ITA NO S . 1655 & 1656 /PN/20 1 6 SHRI SAYYAD JAVED SAYYAD MEHBOOB & ANR. 6 CLAIM OF ASSESSEE IF PROVED IS ALLOWABLE UND ER SECTION 49(1) OF THE ACT. HOWEVER, THE ONUS WAS UPON THE ASSESSEE TO ESTABLISH ITS CASE OF COST OF IMPROVEMENTS ALONG WITH PROOF AND EVIDENCE OF CARRYING OUT THE IMPROVEMENT. IN THE ABSENCE OF THE SAME, THE CLAIM OF ASSESSEE CANNOT BE ALLOWED. ACCORD INGLY, THE SAME IS REJECTED. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE ARE THUS, DISMISSED. 10 . THE FACTS AND ISSUE IN ITA NO. 1656/PN/2016 ARE IDENTICAL TO THE FACTS AND ISSUE IN ITA NO.1655/PN/2016 AND THE DECISION IN ITA NO.1655/PN/2016 SHALL APPLY MUTATIS MUTANDIS TO ITA NO.1656/PN/2016. 1 1 . IN THE RESULT, BOTH THE APPEAL S OF ASSESSEE ARE DISMISSED. ORDER PRONOUNCED ON THIS 11 TH DAY OF NOVEMBER , 201 6 . SD/ - (SUSHMA CHOWLA) / JUDICIAL MEMBER / PUNE ; DATED : 11 TH NOVEMBER , 201 6 . GCVSR / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APPELLANT ; 2. / THE RESPONDENT; 3. ( ) / THE CIT(A) - 2 , AURA NGABAD ; 4. / THE PR. CIT - 2 , AURANGABAD ; 5. 6. , , , - / DR SMC , ITAT, PUNE; / GUARD FILE . / BY ORDER , // TRUE COPY // / SR. PRIVATE SECRETARY , / ITAT, PUNE