DCIT CC 39, MUMBAI V. LAXMI JAIN, MUMBAI

ITA 2118/MUM/2012

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 84354 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 7 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-11-2014
• Appeal Filed By: Department
• Bench Allotted: A
• Next Hearing Date: 08-10-2014
• Assessment Year: 2009-2010
• Appeal Filed On: 30-03-2012
• Court: TRIBUNAL
• Department Lawyers: ASGHAR ZAIN
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, MUMBAI BEFORE SHRI D. KARUNAKARA RAO, ACCOUNTANT MEMBER AND SHRI SANJAY GARG, JUDICIAL MEMBER ./I.T.A. NO. 2118/M/2012 ( AY: 2009 - 2010 ) DCIT - CC 39, R.NO.32(1), GROUND FLOOR, AAYAKAR BHAVAN, M.K. ROAD, MUMBAI 400 020. / VS. SMT. LAXMI JAIN, 82, MAKER CHAMBERS III, NARIMAN POINT, MUMBAI 400 021. ./ PAN : AABPJ 1889R ( / APPELLANT) .. ( / RESPONDENT ) / APPELLANT BY : SHRI ASGHA R ZAIN / RESPONDENT BY : SHRI VIJAY MEHTA / DATE OF HEARING : 08.10.2014 / DATE OF PRONOUNCEMENT : 26 .11.2014 / O R D E R PER D. KARUNAKARA RAO, AM: THIS APPEAL FILED BY THE REVENUE ON 30.3.2012 IS AGAINST THE ORDER OF THE CIT(A) - 41, MUMBAI DATED 9.1.2012 FOR THE ASSESSMENT YEAR 2009 - 2010. 2. IN THIS APPEAL , REVENUE RAISED THE FOLLOWING GROUNDS WHICH READ AS UNDER: 1. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCE S OF THE CASE AND IN LAW, THE LD CIT (A) WAS JUSTIFIED IN HOLDING THAT RATEABLE VALUE AS DETERMINED BY THE MUNICIPAL AUTHORITIES SHALL BE YARD STICK BY FOLLOWING THE ORDER OF THE HONBLE BOMBAY HIGH COURT IN THE CASE OF SMITABEN N. AMBANI VS. CWT 323 ITR 1 04. BY DOING SO, HE HAS IGNORED THE DECISION IN THE FOLLOWING CASES WHEREIN IT HAS BEEN HELD THAT THE ANNUAL LETTING VALUE AS DETERMINED BY THE MUNICIPAL AUTHORITIES IS ONLY ONE OF THE FACTS AND THE SAME CAN BE IGNORED IF IT DOES NOT REFLECT THE TRUE ALV. THESE DECISIONS ARE: 1. ITO VS. SPEARHEAD PROPERTIES (P) LTD. 46 SOT 208 2. TIVOLI INVESTMENT AND TRADING COMPANY PVT LTD VS. ACIT 130 ITD 521 3. ITO VS. HANSA MOTOR WORKS 46 SOT 160 2. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD CIT (A) WAS JUSTIFIED IN HOLDING THAT THE DETERMINATION OF ALV OF HOUSE PROPERTY OF RS.1,65,51,632/ - (3,94,508 + 1,61,57,124) JIS NOT CORRECT AND SAME CANNOT BE EXCEED RS. 94,181/ - (5,880 + 88,301) I.E., ALV AS DETERMINED BY MUNICIPAL CORPORATION WHEN IN T HE PRESENT CASE THERE ARE EVIDENCES TO SUGGEST THAT THE AO 2 DETERMINED THE ALV BY TAKING COMPARABLE RENT AS PER THE INSPECTORS REPORT DATED 23.12.2010. 3. BRIEFLY STATED RELEVANT FACTS OF THE CASE ARE THAT THE ASSESSEE IS AN INDIVIDUAL AND FILED THE RETURN SHOWING THE HOUSE PROPERTY INCOME ON ACCOUNT OF COUPLE OF PROPERTIES IE., (I) GALA NO.311 AND (II) CENTRAL GARDEN COMPLEX. IN THE RETURN OF INCOME, FOR THE PURPOSE OF COMPUTATION OF ALV OF THE PROPERTIES, ASSESSEE RELIE D ON THE RATEABLE VALUES OF TH ESE PROPERTIES. AO COMPLETED THE ASSESSMENT U /S 143(3) OF THE AND REJECTED THE COMPUTATION OF ALV OF THE SAID PROPERTIES AND HELD THAT A PERCENTAGE OF INVESTMENT IN THE PROPERTIES SHOULD REFLECT CORRECT ALV. ACCORDINGLY, HE Q UANTIFIED THE ALVS AND THE CUMULATIVE ALV OF THE PROPERTIES WAS TAKEN AT RS. 1,65,51,632/ - (GALAS ALV IS RS. 3,94,508/ - AND RS.1,61,57,124/ - IS THE ALV OF OTHER PROPE RTIES). OTHERWISE, ASSESSEES COMPUTATION IN THIS REGARD WORKED OUT AT RS.94,181/ - IE., G ALAS RATEABLE VALUE IS RS.5,880/ - AND OTHER PROPERTIES IS RS.88,301/ - . AO RELIED ON THE INSPECTORS REPORT OF COMPARABLE CASES IN THIS REGARD. AGGRIEVED WITH THE SAME, ASSESSEE IS IN APPEAL BEFORE THE FIRST APPELLATE AUTHORITY. 4. DURING THE PROCEEDINGS BEFORE THE FIRST APPELLATE AUTHORITY, CIT (A) REJECTED THE AOS METHOD OF COMPUTATION OF ALV OF THE SAID TWO PROPERTIES AND UPHELD THE ASSESSEES RATEABLE VALUE. FOR THIS, CIT(A) RELIED ON VARIOUS DECISIONS INCLUDING THE JUDGMENT OF THE JURISDICTIONAL HIG H COURT IN THE CASE OF SMITABEN N AMBANI VS. CWT, 323 ITR 104 WHEREIN IT WAS HELD THAT RATEABLE VALUE OF THE PROPERTIES DETERMINED BY THE MUNICIPAL AUTHORITIES SHALL BE THE YARD STICK. AGGRIEVED WITH THE DECISION OF THE CIT (A), REVENUE IS IN APPEAL BEFOR E THE TRIBUNAL BY RAISING THE ABOVE MENTIONED GROUNDS. 5. DURING THE PROCEEDINGS BEFORE US, LD DR RELIED ON VARIOUS DECISIONS TO STATE THAT THE ALV AS DETERMINED BY THE MUNICIPAL AUTHORITIES IS ONLY ONE OF THE FACTORS AND SAME CAN BE IGNORED IF IT DOES NOT REFLECT THE TRUE ALV . LD DR RELIED ON THE ORDER OF THE AO. 6. ON THE OTHER HAND, LD COUNSEL FOR THE ASSSESSEE HEAVILY RELIED ON THE ORDER OF THE CIT(A) AND REITERATED THE SUBMISSIONS MADE BEFORE THE LOWER AUTHORITIES. 7. WE HAVE HEARD BOTH THE PARTIES AN D PERUSED THE ORDERS OF THE REVENUE AUTHORITIES AS WELL AS THE RELEVANT MATERIAL PLACED BEFORE US. ON HEARING BOTH THE 3 PARTIES AND ON PERUSAL OF THE ORDERS OF THE REVENUE AUTHORITIES, WE FIND THAT THE CIT (A) HAS RIGHTLY RELIED ON THE BINDING JUDGMENT OF THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF SMITABEN N AMBANI (SUPRA). THERE ARE MANY OTHER DECISIONS FROM THE JURISDICTIONAL HIGH COURT IN THE SIMILAR LINES, THE COPIES OF WHICH ARE PLACED IN THE PAPER BOOK OF THE ASSSESSEE. THE REVENUE HAS NOT DEMONSTRATED THAT THE FACTS OF THE ASSESSEES CASE ARE COVERED BY THE DECISIONS CITED IN GROUND NO.1 OF THE PRESENT APPEAL. CONSIDERING THE BINDING NATURE OF THE JURISDICTIONAL HIGH COURT JUDGMENT IN THE CASE OF SMITABEN N AMBANI (SUPRA), WE ARE OF THE O PINION THAT THE FINDING OF THE CIT (A) IS AN O RDER AND IT DOES NOT CALL FOR ANY INTERFERENCE ON THIS ISSUE. IN ANY CASE, THE PERCENTAGE OF INVESTMENT IN THE IMPUGNED PROPERTIES IS NO BASIS FOR ARRIVING AT THE ALV OF THE PROPERTIES. ACCORDINGLY, THE GROUN DS RAISED BY THE REVENUE ARE DISMISSE D . 8. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSED. ORDER PRO NOUNCED IN THE OPEN COURT ON 2 6 T H NOVEMBER, 2014. S D / - S D / - ( SANJAY GARG ) (D. KARUNAKARA RAO ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; 2 6 /11/2014 . . ./ OKK , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE //TRUE COPY// / BY ORDER , / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI