Smt. Shibani S. Pungaliya, V. District Valuation Officer - I,

ITA 2147/PUN/2013

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 8529 (ITAT-PUNE)
• Duration Of Justice: 10 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-10-2014
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 28-10-2014
• Assessment Year: 2004-2005
• Appeal Filed On: 10-12-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: A K MODI; P S NAIK
• Assessee Lawyers: V L JAIN
• Keywords: Sale consideration of property below Jantri Value; Opportunity of being heard
• Section: 143(3); 50C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B, PUNE BEFORE SHRI G.S. PANNU, ACCOUNTANT MEMBER AND MS. SUSHMA CHOWLA, JUDICIAL MEMBER ITA NO.2142/PN/2013 (ASSESSMENT YEAR : 2004-05) SMT. SHIBANI S. PUNGALIYA, 562/1, SHIVAJINAGAR, PUNE 411 005. PAN : AFBPP0679Q . APPELLANT VS. INCOME TAX OFFICER, WARD 7(1), PUNE. . RESPONDENT ITA NO.2147/PN/2013 (ASSESSMENT YEAR : 2004-05) SMT. SHIBANI S. PUNGALIYA, 562/1, SHIVAJINAGAR, PUNE 411 005. PAN : AFBPP0679Q . APPELLANT VS. DVO-I, I.T. DEPT. MUMBAI-12. . RESPONDENT ASSESSEE BY : MR. V. L. JAIN DEPARTMENT BY : MR. A. K. MODI & MR. P. S. NAIK DATE OF HEARING : 28-10-2014 DATE OF PRONOUNCEMENT : 28-10-2014 ORDER PER G. S. PANNU, AM BOTH THE CAPTIONED APPEALS HAVE BEEN PREFERRED BY T HE SAME ASSESSEE AND PERTAIN TO THE SAME ASSESSMENT YEAR 2004-05. 2. ITA NO.2142/PN/2013 IS AN APPEAL DIRECTED AGAINS T THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-III, PUNE DATE D 01.10.2013 WHICH, IN TURN, HAS ARISEN FROM AN ORDER DATED 22.12.2006 PAS SED BY THE ASSESSING OFFICER U/S 143(3) OF THE INCOME-TAX ACT, 1961 (IN SHORT THE ACT). ITA NOS.2142 & 2147/PN/2013 3. ITA NO.2147/PN/2013 IS AN APPEAL DIRECTED AGAINS T THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-III, PUNE DATE D 30.09.2013 WHICH, IN TURN, AROSE ON ACCOUNT OF AN APPEAL FILED BY THE AS SESSEE AGAINST THE ORDER PASSED BY THE DVO-I, MUMBAI DATED 19.06.2007 U/S 55 A OF THE ACT R.W.S. 16A(5) OF THE WEALTH TAX ACT, 1957. 4. THE PRIMARY DISPUTE IN THE CAPTIONED APPEALS IS WITH REGARD TO LONG TERM CAPITAL GAIN EARNED BY THE ASSESSEE FROM SALE OF PR OPERTY AT NASHIK. THE ASSESSEE IS A OWNER OF 1/4 TH SHARE IN THE PROPERTY WHICH WAS INHERITED BY HER ON 10.11.1995 FROM HER FATHER. THE SAID PROPERTY W AS TRANSFERRED DURING THE PREVIOUS YEAR RELEVANT TO THE ASSESSMENT YEAR UNDER CONSIDERATION VIDE TWO DEVELOPMENT AGREEMENTS EXECUTED ON 28.02.2006 FOR A TOTAL CONSIDERATION OF RS.40,00,000/-. BY ADOPTING THE AFORESAID CONSIDER ATION, THE ASSESSEE DECLARED HER SHARE OF LONG TERM CAPITAL GAIN FROM S ALE OF PROPERTY AT RS.5,06,905/-. THE ASSESSING OFFICER, HOWEVER, INV OKED THE PROVISIONS OF SECTION 50C OF THE ACT AND ADOPTED THE VALUE CONSID ERED BY THE STAMP DUTY AUTHORITIES AS THE FULL VALUE OF CONSIDERATION WHIC H IN THE PRESENT CASE WAS RS.1,28,94,000/-. ACCORDINGLY, ASSESSEES SHARE OF THE LONG TERM CAPITAL GAIN ON SALE OF PROPERTY WAS ASSESSED BY THE ASSESSING O FFICER AT RS.32,09,980/- AS AGAINST RS.5,06,905/- DECLARED BY THE ASSESSEE. IN THE COURSE OF ASSESSMENT PROCEEDINGS, ASSESSEE HAD OBJECTED TO TH E ADOPTION OF THE VALUATION MADE BY THE STAMP VALUATION AUTHORITY AS THE FULL VALUE OF CONSIDERATION. THE ASSESSING OFFICER HAD REFERRED THE MATTER FOR VALUATION TO THE DISTRICT VALUATION OFFICER (DVO) IN TERMS OF SE CTION 50C(2) OF THE ACT. HOWEVER, SINCE THE REPORT OF THE DVO WAS NOT RECEIV ED TILL THE DATE OF COMPLETION OF ASSESSMENT, THE ASSESSING OFFICER HAD COMPUTED THE CAPITAL GAIN BY ADOPTING THE STAMP DUTY VALUATION OF RS.1,2 8,94,000/- AS THE FULL VALUE OF CONSIDERATION. THE ASSESSEE CHALLENGED THE ASSE SSMENT ORDER PASSED BY THE ASSESSING OFFICER IN APPEAL BEFORE THE CIT(A). IN THE MEANWHILE, DURING ITA NOS.2142 & 2147/PN/2013 THE PENDENCY OF APPEAL BEFORE THE CIT(A), THE FINAL REPORT OF THE DVO DATED 19.06.2007 WAS RECEIVED WHEREIN THE PROPERTY AS ON THE DATE OF SALE WAS VALUED AT RS.1,44,28,390/-. 5. ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT(A) C HALLENGING THE REPORT OF THE DVO DATED 20.02.2007. THE SAID APPEAL OF TH E ASSESSEE HAS SINCE BEEN DISMISSED BY THE CIT(A) VIDE HER ORDER DATED 3 0.09.2013 ON THE GROUND THAT THE ORDER SOUGHT TO BE APPEALED AGAINST BY THE ASSESSEE WAS NOT COVERED UNDER ANY OF THE CLAUSES OF SECTION 246A(1) OF THE ACT. THE APPEAL WAS THUS DISMISSED IN-LIMINE AS NOT MAINTAINABLE. THIS ORDE R OF THE CIT(A) IS SOUGHT TO BE CHALLENGED BY THE ASSESSEE VIDE ITA NO.2147/PN/2 013. HOWEVER, AS WAS FAIRLY CONCEDED BY THE LEARNED REPRESENTATIVE FOR T HE ASSESSEE THERE IS NO INFIRMITY IN THE IMPUGNED ORDER OF THE CIT(A) AS TH E ORDER OF THE DVO DATED 19.06.2007 IS NOT AN ORDER APPEALABLE BEFORE THE CI T(A) AS PRESCRIBED IN SECTION 246A(1) OF THE ACT. THEREFORE, THE ORDER O F THE CIT(A) DATED 30.09.2012 IS HEREBY AFFIRMED AND THE APPEAL OF THE ASSESSEE VIDE ITA NO.2147/PN/2013 IS DISMISSED. 6. HOWEVER, THE LEARNED REPRESENTATIVE SUBMITTED TH AT THE OBJECTIONS AGAINST THE REPORT OF THE DVO DATED 19.06.2007 WERE NOT CONSIDERED BY THE CIT(A) EVEN IN THE COURSE OF THE DETERMINATION OF A SSESSEES APPEAL CHALLENGING THE ASSESSMENT OF LONG TERM CAPITAL GAI N AT RS.32,09,980/- AS AGAINST RS.5,06,905/- OFFERED BY THE ASSESSEE. THE LEARNED COUNSEL EXPLAINED THAT THE CIT(A) HAS TAKEN NOTE OF THE VAL UATION MADE BY THE DVO AT RS.1,44,28,390/- AND FINDING THE SAME TO BE HIGHER THAN THE VALUATION ADOPTED BY THE STAMP DUTY VALUATION AUTHORITY, HAS UPHELD T HE ACTION OF THE ASSESSING OFFICER IN ADOPTING THE FULL VALUE OF CONSIDERATION AT THE VALUE DETERMINED BY THE STAMP DUTY VALUATION AUTHORITY IN TERMS OF SECT ION 50C(3) OF THE ACT. IT IS POINTED OUT THAT ASSESSEE HAD RAISED OBJECTIONS AGA INST THE REPORT OF THE DVO, ITA NOS.2142 & 2147/PN/2013 WHICH HAVE BEEN UNJUSTLY SHUTOUT. THE LEARNED REPR ESENTATIVE SUBMITTED THAT THE APPELLANT WOULD BE SATISFIED IF THE MATTER IS R ESTORED BACK TO THE FILE OF THE CIT(A) TO ADJUDICATE AFRESH AFTER TAKING INTO CONSI DERATION THE OBJECTIONS OF THE ASSESSEE AGAINST THE VALUATION ARRIVED AT BY THE DV O. THE LEARNED DEPARTMENTAL REPRESENTATIVE APPEARING FOR THE REVEN UE HAS NOT OPPOSED THE PRELIMINARILY PLEA OF THE ASSESSEE OF REMANDING THE MATTER BACK TO THE FILE OF THE CIT(A) IN ORDER TO CONSIDER THE OBJECTIONS OF T HE ASSESSEE TO THE VALUE DETERMINED BY THE DVO AND THEREAFTER ADJUDICATE THE DETERMINATION OF LONG TERM CAPITAL GAINS IN THE HANDS OF THE ASSESSEE. 7. IN THE AFORESAID BACKGROUND, WE FIND THAT THE AS SESSEE IS JUSTIFIED IN ASSERTING THAT THE OBJECTIONS TO THE REPORT OF THE DVO BE CONSIDERED BEFORE DETERMINING LONG TERM CAPITAL GAINS ASSESSABLE IN T HE HANDS OF THE ASSESSEE ON ACCOUNT OF THE SALE OF PROPERTY AT NASHIK. ACCO RDINGLY, WE SET-ASIDE THE ORDER OF THE CIT(A) AND RESTORE THE MATTER BACK TO HER FILE FOR ADJUDICATION OF THE ISSUE RELATING TO LONG TERM CAPITAL GAIN ON SAL E OF PROPERTY AT NASHIK AFTER TAKING INTO ACCOUNT THE SUBMISSIONS PUT-FORTH BY TH E ASSESSEE, IN PARTICULAR THE OBJECTIONS OF THE ASSESSEE TO THE VALUATION MADE BY THE DVO VIDE ORDER DATED 19.06.2007. NEEDLESS TO SAY, THE CIT(A) SHALL ALLO W THE ASSESSEE A REASONABLE OPPORTUNITY OF BEING HEARD AND ONLY THER EAFTER PASS AN ORDER AFRESH IN ACCORDANCE WITH LAW. 8. IN THE RESULT, APPEAL OF THE ASSESSEE IN ITA NO. 2142/PN/2013 IS PARTLY ALLOWED, AS ABOVE. 9. RESULTANTLY, WHEREAS APPEAL IN ITA NO.2142 IS PA RTLY ALLOWED THAT, IN ITA NO.2147 IS DISMISSED. ITA NOS.2142 & 2147/PN/2013 ABOVE DECISION WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF BOTH THE PARTIES AT THE CONCLUSION OF THE HEARING O N 28 TH OCTOBER, 2014. SD/- SD/- (SUSHMA CHOWLA) (G.S. PANNU) JUDICIAL MEMBER ACCOUNTANT MEMBER PUNE, DATED: 28 TH OCTOBER, 2014. SUJEET COPY OF THE ORDER IS FORWARDED TO : - 1) THE ASSESSEE; 2) THE DEPARTMENT; 3) THE CIT(A)-III, PUNE; 4) THE CIT-III, PUNE; 5) THE DR B BENCH, I.T.A.T., PUNE; 6) GUARD FILE. BY ORDER //TRUE COPY// ASSISTANT REGISTRAR I.T.A.T., PUNE