Saleha Sultan, Hyderabad V. Income Tax Officer, Ward-6(1), Hyderabad

ITA 2223/Hyd/2018

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 0533 (ITAT-HYDERABAD)
• Duration Of Justice: 2 year(s) 7 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-07-2021
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB-B
• Assessment Year: 2003-2004
• Appeal Filed On: 28-11-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Capital asset; Cost of acquisition; Capital Gains

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES B : HYDERABAD (THROUGH VIDEO CONFERENCE) BEFORE SHRI S.S.GODARA, JUDICIAL MEMBER AND SHRI LAXMI PRASAD SAHU, ACCOUNTANT MEMBER I.T.A. NO. 2223/HYD/2018 ASSESSMENT YEAR: 2003-04 MRS.SALEHA SULTAN, HYDERABAD [PAN: ALXPS6084N] VS INCOME TAX OFFICER, WARD-6(1), HYDERABAD (APPELLANT) (RESPONDENT) FOR ASSESSEE : NONE FOR REVENUE : SHRI ROHIT MUJUMDAR, DR DATE OF HEARING : 24-05-2021 DATE OF PRONOUNCEMENT : 19-07-2021 O R D E R PER S.S.GODARA, J.M. : THIS ASSESSEES APPEAL FOR AY.2003-04 ARISES FROM TH E CIT(A)-9, HYDERABADS ORDER DATED 02-02-2017 PASSED IN APPEAL NO.0104 / ITO, WARD-6(1) / 2015-16, INVOLVIN G PROCEEDINGS U/S.143(3) OF THE INCOME TAX ACT, 1961 [I N SHORT, THE ACT]. CASES CALLED TWICE. NONE APPEARED FOR THE ASSESSEES BEHEST. IT IS ACCORDINGLY PROCEEDED EX-PARTE . 2. IT TRANSPIRES AT THE OUTSET THAT THIS ASSESSEES INSTANT APPEAL SUFFERS FROM 257 DAYS DELAY STATED TO BE ATTRIBUTA BLE TO THE REASON(S) BEYOND HER CONTROL AS PER CONDONATION ITA NO. 2223/HYD/2018 :- 2 -: PETITION/AFFIDAVIT. NO REBUTTAL HAS COME FROM THE DEPARTM ENTAL SIDE. THE IMPUGNED DELAY IS CONDONED THEREFORE. 3. THE ASSESSEE HAS PLEADED THE FOLLOWING SUBSTANTIVE GROUNDS IN THE INSTANT APPEAL: 1.THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) IS CONTRARY TO LAW AND FACTS IN THE CIRCUMSTANCES OF T HE CASE. 2.THE LEARNED COMMISSIONER OF INCOME-TAX ERRED THAT THE INCOME-TAX OFFICER ERRED IN RE-OPENING THE ASSESSMENT WITHOUT SUFFICIENT AND VALID REASONS, ON THE FACTS AND IN THE CIRCUMSTANCE S OF THE CASE. 3.THE LEARNED COMMISSIONER OF INCOME-TAX ERRED IN N OT APPRECIATING THE FACT THAT THE INCOME-TAX OFFICER ERRED IN NOT S UPPLYING THE REASONS FOR RE-OPENING THE ASSESSMENT, ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE. 4.THE LEARNED COMMISSIONER OF INCOME-TAX ERRED IN B RINGING TO TAX- CAPITAL GAINS FROM PROPERTY BEARING NO.KHASRA NO. 7 8.1.2.3.2.2.2, PHNO.23, NM-5,VIKAS KHAND PHANDA, VILLAGE-KOH-E-FIZ A, TEHSIL HUZUR, BHOPAL SOLD FOR RS.10,50,000. HE FAILED TO A PPRECIATE THE FACT THAT SINCE THERE IS NO COST OF ACQUISITION OF THE P ROPERTY INHERITED FROM RULER NO CAPITAL GAINS COULD HAVE BEEN ASCERTAINED OR BROUGHT TO TAX, ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE. 5.WITHOUT PREJUDICE TO THE ABOVE, THE LEARNED COMMI SSIONER OF INCOME-TAX ERRED IN NOT DIRECTING THE INCOME-TAX OF FICER TO ADOPT THE COST AS ON 01-04-1981 AT THE VALUE CERTIFIED BY THE APPROVED VALUER, AMOUNTING TO RS.1,73,000, PROPERTY BEARING NO.KHASR A NO.78.1.2.3.2.2.2,PH NO.23, RNM-5, VIKAS KHAND PHAN DA, VILLAGE- KOH-E- FIZA, TEHSIL UZUR, BHOPAL. 6.THE LEARNED COMMISSIONER OF INCOME-TAX ERRED IN B RINGING TO TAX- CAPITAL GAINS FROM PROPERTY BEARING NO.KHASRA NO.78.1/2/3/2/2/2,PH NO.23, RNM-5,VIKAS KHAND PHAND A, VILLAGE- KOH-E- FIZA, TEHSIL HUZUR, BHOPAL SOLD FOR RS.24,50 ,000. HE FAILED TO APPRECIATE THE FACT THAT SINCE, THERE IS NO COST OF ACQUISITION OF THE PROPERTY INHERITED FROM THE RULER AND AS SUCH NO CA PITAL GAINS COULD HAVE BEEN ASCERTAINED OR BROUGHT TO TAX, ON THE FAC TS AND IN THE CIRCUMSTANCES OF THE CASE. 7.WITHOUT PREJUDICE TO THE ABOVE, THE LEARNED COMMI SSIONER OF INCOME-TAX ERRED IN NOT DIRECTING THE INCOME-TAX OF FICER TO ADOPT THE COST AS ON 01-04-1981 AT THE VALUE CERTIFIED BY THE APPROVED VALUER, AMOUNTING TO RS.4,66,000, PROPERTY BEARING NO.KHASR A NO.78.1/2/3/2/2/2,PH NO.23, RNM-5, VIKAS KHAND PHAN DA, VILLAGE- KOH-E- FIZA, TEHSIL HUZUR, BHOPAL. ITA NO. 2223/HYD/2018 :- 3 -: 8.THE LEARNED COMMISSIONER OF INCOME-TAX ERRED IN B RINGING TO TAX - CAPITAL GAINS FROM PROPERTY BEARING NO.KHASRA NO.78 KOH-E- FIZA, BHOPAL SOLD FOR RS.7,50,000. HE FAILED TO APPRECIAT E THE FACT THAT SINCE, THERE IS NO COST OF ACQUISITION OF THE PROPE RTY, IT HAVING BEEN INHERITED FROM THE RULER NO CAPITAL GAINS COULD HAV E BEEN ASCERTAINED OR BROUGHT TO TAX, ON THE FACTS AND IN THE CIRCUMST ANCES OF THE CASE. 9.WITHOUT PREJUDICE TO THE ABOVE THE LEARNED COMMIS SIONER OF INCOME-TAX ERRED IN NOT DIRECTING THE INCOME-TAX OF FICER TO ADOPT THE COST AS ON 01-04-1981 AT THE VALUE CERTIFIED BY THE APPROVED VALUER, AMOUNTING TO RS.3,45,600 PROPERTY BEARING NO.KHASRA NO.78 KOH-E- FIZA, BHOPAL. 10.THE LEARNED COMMISSIONER OF INCOME-TAX FURTHER E RRED IN NOT APPRECIATING THE FACT THAT THE INCOME-TAX OFFICER E RRED IN ADOPTING THE VALUE AS PER SRO, ON THE FACTS AND IN THE CIRCUMSTA NCES OF THE CASE. 11.THE LEARNED COMMISSIONER OF INCOME-TAX SIMILARLY ERRED IN NOT APPRECIATING THE FACT THAT THE SRO VALUE CANNOT BE THE MARKET VALUE OF THE PROPERTY AS ON 01-04-1981, ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE. 12.THE APPELLANT CRAVES LEAVE TO ADD TO, ALTER OR A MEND ANY OF THE AFORESAID GROUNDS AS ADVISED, ON OR BEFORE THE DATE OF HEARING. 4. COMING TO THE ASSESSEES FIRST AND FOREMOST ISSUE SE EKING TO CHALLENGE VALIDITY OF THE IMPUGNED REOPENING, WE N OTICE FROM A PERUSAL OF THE CIT(A)S DISCUSSION IN PARA 5.1 PG. 3 THAT SHE HAD NOT PRESSED FOR THE CORRESPONDING SUBSTANTIVE GROU ND IN LOWER APPELLATE PROCEEDINGS. WE THUS DECLINE THE INSTA NT SUBSTANTIVE GRIEVANCE FOR THIS PRECISE REASON ALONE. 5. NEXT COMES THE LATTER ISSUE OF COST OF ACQUISITION OF THE IMPUGNED CAPITAL ASSET W.E.F.01-04-1981 U/S.48 EXPLAN ATION (3) OF THE INCOME TAX ACT. LEARNED DEPARTMENTAL REPRESENTATIVE FAILS TO DISPUTE IN LIGHT OF THE CIT(A)S DETAILED DISCUSSION IN PARA 4 PG .2 THAT THIS CASE HAS BEEN ADOPTED IN VIEW OF 1984-85 RATES THAN W .E.F. 01-04-1987 (SUPRA). SUCH A COURSE OF ACTION ADOPTING 1984-85 VALUE OF THE COST OF ACQUISITION GOES AGAINST THE SCHEM E OF THE ITA NO. 2223/HYD/2018 :- 4 -: ACT IN FOREGOING TERMS. WE THEREFORE RESTORE THE ASSESSE ES INSTANT SUBSTANTIVE GRIEVANCE BACK TO THE ASSESSING OFFIC ER TO FINALISE THE IMPUGNED COST OF ACQUISITION OF THE ASSE SSEES CAPITAL ASSET AS ON 01-04-1981 ONLY. IT IS FURTHER MA DE CLEAR THAT SECTION 49(1)(III) ALSO MAKES IT CLEAR THAT THE COST OF ACQUISITION IN A CASE INVOLVING THE SUCCESSION INHER ITANCE OR DEVOLUTION WITHOUT CONSIDERATION IS TO BE DEEMED TO BE T HE COST FOR WHICH THE PREVIOUS OWNER OF THE PROPERTY HAD ACQU IRED IT. THIS IS FOLLOWED BY THE 1 ST EXPLANATION THAT THE EXPRESSION PREVIOUS OWNER OF THE PROPERTY MEANS LAND PREVIOUS OWNER OF THE CAPITAL ASSET WHO HAD ACQUIRED IT BY WAY OF CONSID ERATION. WE THEREFORE DIRECT THE LEARNED ASSESSING OFFICER TO F INALISE THE IMPUGNED COMPUTATION AFTER TAKING INTO CONSIDERATION THE FOREGOING STATUTORY PROVISION AS PER LAW. 6. THIS ASSESSEES APPEAL IS TREATED AS PARTLY ALLOWE D FOR STATISTICAL PURPOSES IN ABOVE TERMS. ORDER PRONOUNCED IN THE OPEN COURT ON 19 TH JULY, 2021 SD/- SD/- (LAXMI PRASAD SAHU) (S.S.GO DARA) ACCOUNTANT MEMBER JUDICIAL MEMB ER HYDERABAD, DATED: 19-07-2021 TNMM ITA NO. 2223/HYD/2018 :- 5 -: COPY TO : 1.MRS.SALEHA SULTAN, C/O.M/S.M.A.MOHIADDIN & CO., CHARTERED ACCOUNTANTS, 307, LENAINE ESTATE, 5-9-189 , ABID ROAD, HYDERABAD. 2.THE INCOME TAX OFFICER, WARD-6(1), HYDERABAD. 3.CIT(APPEALS)-9, HYDERABAD. 4.PR.CIT-6, HYDERABAD. 5.D.R. ITAT, HYDERABAD. 6.GUARD FILE. 4