SHIRLEY SUMAN MASTER, MUMBAI V. ITO WD - 22(3)(3), MUMBAI

ITA 2027/MUM/2019

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 2353 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 7 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-11-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2012-2013
• Appeal Filed On: 05-04-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANJAY J SETHI
• Keywords: Cost of acquisition; Valuation report; Revised return; Set aside
• Section: 139(5); 13

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, MUMBAI BEFORE SHRI SAKTIJIT DEY , JUDICIAL MEMBER ITA NO. 2027 /MUM. /201 9 ( ASSESSMENT YEAR : 20 12 13 ) SHIRLEY SUMAN MASTER B 62, ANJALI KIRAN CHS NEHRU ROAD, VAKOLA, SANTACRUZ MUMBAI 400 055 PAN APIPM7510E . APPELLANT V/S INCOME TAX OFFICER WARD 22(3)(3), MUMBAI . RESPONDENT ASSESSEE BY : NONE REVENUE BY : S HRI SANJAY J. SETHI DATE OF HEARING 11 .11.2020 DATE OF ORDER 24.11.2020 O R D E R CAPTIONED APPEAL HAS BEEN FILED BY THE ASSESSEE CHALLENGING THE ORDER DATED 6 TH DECEMBER 2018, PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) 34, MUMBAI, PERTAINING TO THE ASSESSMENT YEAR 2012 13. 2. WHEN THE APPEAL WAS CALLED FOR HEARING, NO ONE WAS PRESENT ON BEHALF OF THE ASSESSEE TO REPRESENT THE CASE. THERE IS NO APPLICATION SEEKING ADJOURNMENT EITHER. CONSIDERING THE NATURE OF DISPUTE, I PROCEED TO DISPOSE OFF THE APPEALS EX PARTE QUA THE ASSESSE E AFTER 2 SHIRLEY SUMAN MASTER HEARING THE LEARNED DEPARTMENTAL REPRESENTATIVE AND ON THE BASIS OF MATERIAL AVAILABLE ON RECORD. 3. THE DISPUTE IN THE PRESENT APPEAL IS CONFINED TO THE ADDITION OF AN AMOUNT OF ` 6,91,940, TOWARDS LONG TERM CAPITAL GAIN. 4. BRIEF FACTS ARE, THE ASSES SEE IS AN INDIVIDUAL. FOR THE ASSESSMENT YEAR UNDER DISPUTE, THE ASSESSEE FILED HER RETURN OF INCOME ON 24 TH JULY 2012, DECLARING TOTAL INCOME OF ` 7,45,890. THE TOTAL INCOME SO DECLARED INCLUDED AN AMOUNT OF ` 6,91,940, BEING LONG TERM CAPITAL GAIN. HOWEV ER, IN THE C OURSE OF ASSESSMENT PROCEEDINGS THE ASSESSEE FILED A REVISED COMPUTATION DECLARING LONG TERM CAPITAL GAIN AS NIL. ACCORDING TO THE ASSESSEE, SINCE , SHE WAS UNABLE TO OBTAIN THE VALUE OF PROPERTY AS ON 1981 FOR INDEXATION PURPOSE , SHE HAD PROCEE DED TO COMPUTE CAPITAL GAIN BY ESTIMATING THE COST OF ACQUISITION AT ` 1 LAKH. HOWEVER, SUBSEQUENTLY, SHE FOUND THAT HER BROTHER WHO WAS A CO OWNER OF THE PROPERTY HAVING 50% OF SHARE , HAD MADE A VALUATION OF THE PROPERTY AS OF 1981 AND THE VALUER HAS DETE RMINED THE VALUE OF THE PROPERTY AT ` 5,45,000. THUS, ON THE BASIS OF SUCH VALUATION, SHE HAD FILED THE REVISED COMPUTATION DECLARING CAPITAL GAIN AT NIL. THE ASSESSING OFFICER, HOWEVER, DID NOT ACC EPT THE CLAIM OF THE ASSESSEE . HE WAS OF THE VIEW THAT THE ASSESSEE COULD HAVE REVISED THE LONG TERM CAPITAL GAIN DECLARED , ONLY BY WAY OF A REVISED RETURN OF INCOME FILED 3 SHIRLEY SUMAN MASTER UNDER SECTION 139(5) OF THE ACT. SINCE, THE ASSESSEE HAD NOT DONE SO , THE ASSESSING OFFICER REJECTED THE REVISED COMPUTATION AND PROCEEDED TO DETERMINE THE TOTAL INCOME OF ` 7,45,890, WHICH INCLUDED LONG TERM CAPITAL GAIN OF ` 6,91,940. 5. WHILE DECIDING THE ISSUE IN APPEAL, LEARNED COMMISSIONER (APPEALS) RELYING UPON THE DECISION OF THE HON'BLE SUPREME COURT IN GOETZE INDIA LTD. V/S CIT, [2006] 284 ITR 323 ( SC ) CONFIRMED THE ADDITION . 6. I HAVE CONSIDERED SUBMISSIONS OF LEARNED DEPARTMENTAL REPRESENTATIVE AND PERUSED THE MATERIAL ON RECORD. AS COULD BE SEEN FROM THE FACTS ON RECORD, THE ASSESSEE HAD COMPUTED LONG TERM CAPITAL GAIN IN THE RETURN OF INCOME BY ESTIMATING THE VALU E OF PROPERTY , FOR INDEXATION BENEFIT, AS AT 1981 AT ` 1 LAKH. HOWEVER, SUBSEQUENTLY, SHE CAME TO KNOW THAT HER BROTHER , WHO IS A CO OWNER IN THE PROPERTY HAVING 50% SHARE , HAS OBTAINED A VALUATION REPORT VALUING THE PROPERTY AS AT 1981 AT ` 5,45,000. BEING AWARE OF SUCH FACT, THE ASSESSEE IN THE COURSE OF ASSESSMENT PROCEEDINGS HAD FILED A REVISED COMPUTATION OF INCOME DECLARING THE LONG TERM CAPITAL GAIN AT NIL BY ADOPTING THE VALUE OF T HE PROPERTY AS AT 1981 FOR INDEXATION PURPOSE AT ` 5,45,000. APPARENTLY, THE REVISED COMPUTATION FILED BY THE ASSESSEE HAS BEEN REJECTED BOTH BY THE ASSESSING OFFICER AND LEARNED 4 SHIRLEY SUMAN MASTER COMMISSIONER (APPEALS) PURELY ON THE TECHNICAL GROUND THAT REVISED CLAIM OF T HE ASSESSEE COULD HAVE BEEN ENTERTAINED HAD THE ASSESSEE FILED A REVISED RETURN OF INCOME UNDER SECTION 139(5) OF THE ACT. IN MY CONSIDERED OPINION, THE AFORESAID REASONING OF THE ASSESSING OFFICER AND LEARNED COMMISSIONER (APPEALS) IS CONTRARY TO SETTLED LEGAL PRINCIPLE. IN CASE OF GOETZ INDIA LTD. (SUPRA), RELIED UPON BY THE FIRST APPELLATE AUTHORITY, IT HAS BEEN VERY CLEARLY HELD BY THE HON'BLE SUPREME COURT THAT ANY REVISED CLAIM MADE BY THE ASSESSEE OTHERWISE THAN BY WAY OF REVISED RETURN OF INCOME CAN BE CONSIDERED BY THE APPELLATE AUTHORITIES. THERE IS UMPTEENTH NUMBER OF DECISIONS INCLUDING THE DECISION OF THE HON'BLE JURISDICTIONAL HIGH COURT EXPRESSING IDENTICAL VIEW. THEREFORE, WHEN THE ASSESSEE HAS CLAIMED THAT IN CASE OF CO OWNER OF THE PROPERTY VALUATION AS AT 1981 FOR INDEXATION PURPOSE HAS BEEN ACCEPTED AT A MUCH HIGHER FIGURE, THERE IS NO REASON WHY SUCH VALUATION SHOULD NOT BE ADOPTED IN ASSESSEES CASE. SINCE , THE REVISED COMPUTATION FILED BY THE ASSESSEE DECLARING CAPITAL GAIN AT NIL HAS N OT BEEN EXAMINED BY THE DEPARTMENTAL AUTHORITIES , I AM INCLINED TO SET ASIDE THE IMPUGNED ORDER OF LEARNED COMMISSIONER (APPEALS) AND RESTORE THE ISSUE TO THE ASSESSING OFFICER FOR VERIFYING ASSESSEES CLAIM MADE IN THE REVISED COMPUTATION FILED IN COURSE OF ASSESSMENT PROCEEDINGS. IT IS FURTHER MADE CLEAR , IN CASE IT IS FOUND THAT THE VALUATION OF THE PROPERTY FOR INDEXATION BENEFIT HAS 5 SHIRLEY SUMAN MASTER BEEN ADOPTED AT ` 5,45,000, IN CASE OF OTHER CO OWNER AND ACCEPTED BY THE CONCERNED ASSESSING OFFICER, THERE IS NO REASON FOR NOT APPLYING THE SAME VALUATION FOR INDEXATION PURPOSE IN ASSESSEES CASE WHILE COMPUTING LONG TERM CAPITAL GAIN. NEEDLESS TO MENTION , THE ASSESSEE MUST BE PROVIDED REASONABLE OPPORTUNITY OF HEARING BEFORE DECIDING THE ISSUE. GROUNDS RAISED BY THE ASS ESSEE ARE ALLOWED FOR STATISTICAL PURPOSES . 7. IN THE RESULT, APPEAL IS ALLOWED FOR STATISTICAL PURPOSES . ORDER PRONOUNCED IN THE OPEN COURT ON 24.11.2020 SD/ - SAKTIJIT DEY JUDICIAL MEMBER MUMBAI, DATED: 24.11.2020 COPY OF THE ORDER FORWARDED TO : (1) THE ASSESSEE; (2) THE REVENUE; (3) THE CIT(A); (4) THE CIT, MUMBAI CITY CONCERNED; (5) THE DR, ITAT, MUMBAI; (6) GUARD FILE . TRUE COPY BY ORDER PRADEEP J. CHOWDHURY SR. PRIVATE SECRETARY ASSISTANT REGISTRAR ITAT, MUMBAI