RASHMI CHADHA, Delhi V. PCIT,Jabalpur-1, Jabalpur

ITA 17/JAB/2022

• Counselvise Citation: [NaN] 107 COUNSELVISE.COM (IT) 1800 (ITAT-JABALPUR)
• Duration Of Justice: 3 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-06-2022
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2015-2016
• Appeal Filed On: 17-02-2022
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: MANISH KUMAR GUPTA
• Keywords: Sale consideration of property below Jantri Value; Competent authority; Set aside
• Section: 263; 143(3); 50C; 54F

Judgement Text

1 | P a g e IN THE INCOME TAX APPELLATE TRIBUNAL JABALPUR BENCH, JABALPUR (through web-based video conferencing platform) BEFORE SHRI SANJAY ARORA, HON‟BLE ACCOUNTANT MEMBER & SHRI MANOMOHAN DAS, HON'BLE JUDICIAL MEMBER I.T.A. No. 17/JAB/2022 (Asst. Year : 2015-16) Appellant by : Shri Manish Kumar Gupta, Advocate Respondent by : Shri U.B. Mishra, CIT-DR Date of hearing : 10/05/2022 Date of pronouncement : 02/06/2022 O R D E R Per Manomohan Das, JM This is an Appeal filed by the Appellant against the order dated 30-03-2021 by the ld. Principal Commissioner of Income Tax („Pr. CIT‟) under section 263 of the Income Tax Act, 1961 (hereinafter the “Act”) for assessment year 2015-16. 2. At the outset, it is observed that the instant appeal, filed on 17/2/2022, is delayed by a period of 263 days. The condonation petition, filed along with the appeal, refers to a (unspecified) decision by the Apex Court dated 10/1/2022 whereby, as stated therein, a relaxation is provided from limitation under all general and special laws up to 28/2/2022. We find the same to be in MA No. 21 of 2022 (in Suo Motu WP (C) No. 03/2020 / copy on record), whereby, per para 5, Rashmi Chadha, A-299, First Floor, Defence Colony, New Delhi. [PAN : ANFPS 1218 Q] vs. Pr. CIT, Jabalpur-1, Jabalpur. (Appellant) (Respondent) ITA No. 17/JAB/2022 (A.Y. 2015-16) Rashmi Chadha vs. Pr.CIT 2 | P a g e the Hon‟ble Court has directed exclusion of the period (from 15/3/2020 to 28/2/2022) for the purpose of reckoning limitation under any law. The delay is accordingly condoned. 3. The facts of the case are that the assessee filed her return for the relevant year on 21-09-2015 at an income of Rs. 3,28,700/-, which was selected for scrutiny under CASS, and the Assessing Officer (AO) assessed the income at Rs. 21,46,940/- vide order u/s. 143(3) dated 11-12-2017 by making additions for: (i) Rs. 12,78,870/- (being indexed cost of construction disallowed); and (ii) Rs. 4,85,370/- (as long term capital gain under section 50C of the Act). 4. The assessee had purchased a house property, bearing no. C-211B, Greater Kailash-I, New Delhi, for Rs. 2,30,00,000/- vide sale deed dated 07-08-2014, and it is her claim that she has purchased the said property by selling three properties situate at Adarsh Nagar and Jayanti Complex, Jabalpur (M.P.) respectively. The property situate at Adarsh Nagar was sold at Rs. 2,00,00,000/- and other two properties situate at Jayanti Complex were sold at Rs. 15,00,000/- each. Accordingly, the assessee claimed Rs. 12,78,870/- as indexed cost of the property situate at Adarsh Nagar. Similarly, Rs. 8,41,315/- was claimed as index cost by the assessee, i.e., in the computation of capital gain. 5. The AO, after examining the sale deeds, observed that the assessee had sold property situate at Jayanti Complex without adopting the market value. The market value of the property as per his opinion was Rs.25,84,000/-, whereas the same was sold at Rs. 15,00,000/- each and, therefore, he disallowed the claim of indexed cost and added differential amount and assessed the long term capital gain accordingly. 6. The assessee agitated her assessment by filing an appeal before the first appellate authority, but the same was withdrawn for settlement of the dispute ITA No. 17/JAB/2022 (A.Y. 2015-16) Rashmi Chadha vs. Pr.CIT 3 | P a g e under the DTVSV Scheme. The assessee filed declaration under DTVSV Scheme 2020 for the disputed tax as assessed. 7. The ld. Pr. CIT, vide the impugned order u/s. 263, set aside the assessment order, observing certain deficiencies in the assessment and directed the AO to carry out necessary enquiry and pass a speaking order after giving adequate opportunity of being heard to the assessee. The ld. Pr. CIT observed that the AO had failed to make enquiries as well as apply his mind and proper application of law. According to him, the assessment was erroneous and prejudicial qua the issue of allowability of deduction under section 54F. 8. Aggrieved with the order passed by the ld. Pr. CIT, the assessee has preferred the instant appeal raising several grounds of appeal, all argued together. 9. We have heard the parties, and perused the material on record. 10. Vide section 263 of the Act, the ld. Pr. CIT is empowered to issue /pass any order or direction to subordinate income tax authority. Vide para No. 9.1 of his order the ld. Pr.CIT, observes that nothing was brought on record by the AO regarding the ownership and possession of two properties, as under, which formed a source of income for the assessee as per her return of income, and which was relevant for ascertaining the eligibility u/s. 54F: (i) L-154, Section 25, Jalvayu Vihar, Noida and (ii) H. No. C-1, Plot No. 13, Karanveer Tower, Section 52, Gurgaon, Haryana, It was also observed by the ld. Pr. CIT that the AO did not examine the allowability of provision u/s. 54F of the Act nor in-depth enquiry had been carried out by the AO. 11. The assessment order is completely silent on the aspect of exemption u/s. 54F, which is integral to the computation and assessment of capital gain. There has been neither any enquiry by the AO on the different aspects of sec. 54F, nor, ITA No. 17/JAB/2022 (A.Y. 2015-16) Rashmi Chadha vs. Pr.CIT 4 | P a g e resultantly, any finding qua the same by him. Shri Gupta, the ld. counsel for the assessee, also could not during hearing show us any enquiry having been made in its respect in assessment, though would plead as to the correctness of the claim u/s. 54F as per the return of income. That being a matter subsequent, i.e., to be determined after due inquiry and verification, is however not relevant. There is also, as the competent authority states, income from these two properties arising to the assessee, indicating it to be her properties and in her control and possession. The addition u/s. 50C (in assessment) is a matter distinct and apart from the application of s. 54F, and in any case was the subject matter of appellate proceedings. 12. It is the enquiry during assessment and not that in the appellate proceedings, much less de hors the record, that is relevant. The Hon‟ble Delhi High Court in Gee Vee Enterprises v. Addl. CIT [1975] 99 ITR 375 (Del) held, inter alia, that the income tax officer is not only an adjudicator but also an investigator. He cannot remain passive in the face of a return which is apparently in order but calls for further inquiry. It is his duty to ascertain the truth of the facts stated in the return when the circumstances of the case are such as to provoke an inquiry. It is because it is incumbent on the Income -tax- Officer to further investigate the facts stated in the return when circumstances would make such an inquiry prudent that the word “erroneous” in section 263 includes the failure to make such an enquiry. The order becomes erroneous because such an inquiry has not been made and not because there is anything wrong with the order if all the facts stated therein are assumed to be correct. 13. In view of the foregoing discussion, we find no infirmity in the order passed by the ld. Pr. CIT u/s. 263 of the Act. We, accordingly, uphold his order. ITA No. 17/JAB/2022 (A.Y. 2015-16) Rashmi Chadha vs. Pr.CIT 5 | P a g e 14. In the result, the assessee‟s appeal is dismissed. Order pronounced in open Court on June 02, 2022 sd/- sd/- (Sanjay Arora) (Manomohan Das) Accountant Member Judicial Member Dated: 02/06/2022 vr/- Copy to: 1. The Appellant: Rashmi Chadha, A-299, First Floor, Defence Colony, New Delhi. 2. The Respondent: Principal CIT, Jabalpur-1. 3. The CI T-D.R., I TAT, Jablapur 4. Guard File. By order (VUKKEM RAMBABU) Sr. Private Secretary, ITAT, Jabalpur.