Fathima Farhana , CHENNAI V. ITO Non Corporate Ward 11(4) , CHENNAI

ITA 1728/CHNY/2017

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 3144 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 1 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-08-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2011-2012
• Appeal Filed On: 12-07-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: U MOHAMED KHAILULLAHFCA
• Keywords: Cost of acquisition

Judgement Text

, SMC , IN THE INCOME TAX APPELLATE TRIBUNAL B SMC BENCH : CHENNAI , . , BEFORE SHRI GEORGE MATHAN, JUDICIAL MEMBER & SHRI A.MOHAN ALANKAMONY, ACCOUNTANT MEMBER ./ I.T.A.NO.1727/CHNY/2017 / ASSESSMENT YEAR : 2011-12 MRS.FATHIMA FAHIMA , 191,N.S.C.BOSE ROAD, PARRYS,CHENNAI 600 001. VS. THE INCOME TAX OFFICER, NON-CORPORATE WARD 11(4), CHENNAI. [PAN AAHPF 5548 H ] ( / APPELLANT) ( /RESPONDENT) ./ I.T.A.NO.1728/CHNY/2017 / ASSESSMENT YEAR : 2011-12 MRS.FATHIMA FARHANA , 191,N.S.C.BOSE ROAD, PARRYS,CHENNAI 600 001. VS. THE INCOME TAX OFFICER, NON-CORPORATE WARD 11(4), CHENNAI. [PAN AAAPF 3153 D] ( / APPELLANT) ( /RESPONDENT) ! ' # / APPELLANT BY : MR.U.MOHAMED KHAILULLAH,FCA $% ! ' # /RESPONDENT BY : MR.B.SAGADEVAN,JCIT,D.R & ' ' () / DATE OF HEARING : 27 - 08 - 2018 * ' () / DATE OF PRONOUNCEMENT : 27 - 08 - 2018 ITA NOS.1727 & 1728/CHNY/2017 :- 2 -: / O R D E R PER GEORGE MATHAN, JUDICIAL MEMBER ITA NO.1727/CHNY/2017 IS THE APPEAL FILED BY MRS .FATHIMA FAHIMA, AND ITA NO.1728/CHNY/2017 IS THE APPEAL FIL ED BY MRS.FATHIMA FAHRHNA AGAINST THE SEPARATE ORDERS O F THE COMMISSIONER OF INCOME-TAX (APPEALS)-13, CHENNAI I N APPEAL NO.66/CIT(A)-13/2011-12 & IN APPEAL NO.69/CIT(A)-1 3/2011-12 RESPECTIVELY, BOTH ORDER DATED 28.03.2017 FOR THE ASSESSMENT YEAR 2011-12. 2. MR.U.MOHAMED KHAILULLAH, REPRESENTED ON BEHALF OF THE ASSESSEE AND MR.B.SAGADEVAN REPRESENTED ON BEHALF OF THE REVENUE. 3. IT WAS SUBMITTED BY THE LD.A.R THAT BOTH THE AS SESSEES ARE INDIVIDUALS AND ARE ALSO LEGAL HEIRS OF MRS.M.A.AHA MED ASIA. IT WAS A SUBMISSION THAT ASSESSEES MOTHER MRS.M.A.AHAMED AS IA HAD PURCHASED A PROPERTY AT 26, JAMBULINGAM STREET, NUNGAMBAKKAM,CHENNAI-34 ALONG WITH FOUR OTHERS IN 1 988 AND SHE WAS OWNING 1/5 TH SHARE IN THE SAID PROPERTY PURCHASED. IT WAS FURT HER SUBMISSION THAT ON THE DEATH OF MOTHER MRS.M.A.AHAM ED ASIA ON 16.12.2009, THE ASSESSEES EACH SHARE BECAME 1/9 TH OF ABSOLUTE OWNER ITA NOS.1727 & 1728/CHNY/2017 :- 3 -: OF THE SAID PROPERTY. IT WAS A SUBMISSION THAT THE SAID PROPERTY WAS SOLD DURING THE RELEVANT ASSESSMENT YEAR FOR ABOUT ` 2 CRORES. IT WAS A SUBMISSION THAT AFTER THE PURCHASE OF THE PROPERTY, ASSESSEES MOTHER HAD DEMOLISHED THE EXISTING CONSTRUCTION AND HAD RE -CONSTRUCTED THE SAID PROPERTY BETWEEN THE PERIOD 2007 AND 2010. IT WAS A SUBMISSION THAT ASSESSEES MOTHER HAD INCU RRED EXPENDITURE OF MORE THAN ` 14 LAKHS. IT WAS SUBMITTED THAT THE ASSESSEE HAD CLAIMED THE COST INFLATION INDEX IN RESPECT OF THEI R MOTHERS INVESTMENT IN THE SAID PROPERTY. IT WAS A SUBMISSION THAT THE LD. ASSESSING OFFICER DID NOT ALLOW THE COST INFLATION INDEX ON THE GROUN D THAT THE ASSESSEES HAD NOT FILED ANY DOCUMENTARY EVIDENCE IN SUPPORT O F THE SAME. THE LD. ASSESSING OFFICER HAD NOT ALLOWED INDEXATION IN RESPECT OF COST OF INDEXATION FROM THE ASSESSMENT YEAR 1988-89 ALSO. A GGRIEVED THE ASSESSEE PREFERRED AN APPEAL BEFORE THE LD.CIT(A). ON APPEAL, LD.CIT(A) HAD ALLOWED INDEXATION FROM THE ASSESSMEN T YEAR 1988-89, BUT HAD NOT ALLOWED THE COST OF ACQUISITION IN RESP ECT OF RE-CONSTRUCTED BUILDING. IT WAS A SUBMISSION THAT IN RESPECT OF AN OTHER SISTER SMT.WAVOO FATHIMA MUNEERA, THE SAME LD. ASSESSING O FFICER HAD ACCEPTED THE INDEXATION AND THE COST OF CONSTRUCTIO N. THE LD.A.R PLACED A COPY OF ASSESSMENT ORDER PASSED U/S.143(3) R.W.S.147 OF THE ACT ON 02.03.2016 FOR ASSESSMENT YEAR 2010-11, BEFO RE US. HE ALSO DREW OUR ATTENTION TO THE RETURNS FILED BY HER MOTH ER MRS.M.A.AHAMED ITA NOS.1727 & 1728/CHNY/2017 :- 4 -: ASIA, WHEREIN SHE HAD DISCLOSED THE INVESTMENT IN T HE CONSTRUCTION OF THE PROPERTY AT 26, JAMBULINGAM STREET, NUNGAMBAKKA M,CHENNAI-34 AS FOLLOWS:- A.Y COST OF RE-CONSTRUCTION( `) 2007-08 4,99,131 2008-09 2,61,814 2009-10 1,35,120 2010-11 6,00,092 TOTAL 14,96,157 IT WAS A PRAYER THAT THE LD. ASSESSING OFFICER MAY BE DIRECTED TO GRANT THE ASSESSEES BENEFIT OF THE INDEXATION IN RESPECT OF COST OF CONSTRUCTION AS ALSO THE COST OF IMPROVEMENT. 4. IN REPLY, THE LD.D.R VEHEMENTLY SUPPORTED THE O RDER OF LD.CIT(A). 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. A PE RUSAL OF THE RETURNS FILED BY MRS.M.A.AHAMED ASIA, MOTHER OF THE ASSESSEES HEREIN, CLEARLY SHOW THAT INVESTMENTS IN THE SAID PROPERTY ARE FULLY DISCLOSED. A PERUSAL OF THE ASSESSMENT ORDER PASSED U/S.143(3) R .W.S.147 OF THE ACT ON 02.03.2016 FOR ASSESSMENT YEAR 2010-11 IN THE CA SE OF ONE OF THE SISTERS OF THE ASSESSEES, NAMELY, SMT.WAVOO FATHIMA MUNEERA, SHOWS THAT THE SAME LD. ASSESSING OFFICER HAS ACCEPTED TH E COST OF CONSTRUCTION OF ` 14,96,157/- AND GRANTED INDEXATION IN RESPECT OF TH E SAID PROPERTY. THIS BEING SO, AS THE COST OF CONST RUCTION HAS BEEN ITA NOS.1727 & 1728/CHNY/2017 :- 5 -: ACCEPTED BY THE REVENUE IN THE CASE OF ONE OF THE S ISTERS OF ASSESSEES, IT IS NOT OPEN TO REVENUE TO SAY THAT THE EVIDENCES ARE NOT AVAILABLE. THIS BEING SO, THE ASSESSING OFFICER IS DIRECTED TO GRANT THE ASSESSEES BENEFIT OF THE INDEXATION AND THE COST I N RESPECT OF COST OF CONSTRUCTION INCURRED BY THE ASSESSEES MOTHER IN R ESPECT OF THE SAID PROPERTY, WHICH HAS BEEN SOLD, WHEN COMPUTING THE L ONG TERM CAPITAL GAINS. 6. IN THE RESULT, BOTH THE APPEALS OF THE ASSESSEES , IN THE CASE OF MRS.FATHIMA FAHIMA AND MRS.FATHIMA FARHANA, ARE ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT AFTER CONCLUSION OF HEARING ON 27 TH AUGUST, 2018, AT CHENNAI. SD/ - SD/ - ( . ) (A.MOHAN ALANKAMONY) ! '# / ACCOUNTANT MEMBER ( ) (GEORGE MATHAN) $ '# / JUDICIAL MEMBER - ' / CHENNAI . / DATED: 27 -08-2018 . K S SUNDARAM / ' $(01 2 1( / COPY TO: 1 . ! / APPELLANT 4. & 3( / CIT 2. $% ! / RESPONDENT 5. 145 $(6 / DR 3. & 3( () / CIT(A) 6. 57 8' / GF