The ACIT, Circle-5, Baroda V. Shri Sudhan G. Kanitkar, Baroda

ITA 2225/AHD/2014

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 5697 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 11 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-07-2017
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2008-2009
• Appeal Filed On: 04-08-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: M K PATEL
• Keywords: Sale consideration of property below Jantri Value; Opportunity of being heard; Fair market value

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD A BENCH (BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER & SHRI MAHAVIR PRASAD, JUDICIAL MEMBER) ITA. NO: 2225/AHD/2014 (ASSESSMENT YEAR: 2008-09) ASSISTANT COMMISSIONER OF INCOME-TAX, CIRCLE-5, BARODA V/S SHRI SUDHAN G. KANITKAR MAHAJAN GALI, OPP. KHUSHALCHAND KANYA VIDYALAYA, SURSAGAR NORTH, BARODA, 390001 (APPELLANT) (RESPONDENT) PAN: AIIPK0409K APPELLANT BY : SHRI K. MADHUSUDAN, SR. D .R. RESPONDENT BY : SHRI M. K. PATEL, A.R. ( )/ ORDER DATE OF HEARING : 28 -07-201 7 DATE OF PRONOUNCEMENT : 31 -07-2017 PER N.K. BILLAIYA, ACCOUNTANT MEMBER: 1. THIS APPEAL BY THE REVENUE IS PREFERRED AGAINST THE ORDER OF THE LD. CIT(A)-V, BARODA DATED 26.05.2014 PERTAINING TO A.Y. 2009-09. ITA NO. 2225 /AHD/2014 . A.Y. 2008-09 2 2. THE SHORT GRIEVANCE OF THE REVENUE IS THAT THE LD. CIT(A) ERRED IN DELETING THE PENALTY OF RS. 13,11,069/- LEVIED U/S. 271(1)(C) OF THE ACT ON ACCOUNT OF CONTRAVENTION OF PROVISIONS OF SECTION 50C(1) OF TH E ACT. 3. AT THE VERY OUTSET, THE LD. COUNSEL FOR THE ASSESSE E BROUGHT TO OUR NOTICE, THE DECISION OF THE TRIBUNAL IN RESPECT OF THE ADDITION S MADE BY THE A.O. IN THE ASSESSMENT PROCEEDINGS FOR THE YEAR UNDER CONSIDERA TION. IT IS THE SAY OF THE LD. COUNSEL THAT THE TRIBUNAL HAS SET ASIDE THE QUANTUM PROCEEDINGS TO THE FILES OF THE A.O. FOR FRESH ASSESSMENT AS PER THE DIRECTIONS OF THE TRIBUNAL. 4. WE FIND FORCE IN THE CONTENTION OF THE LD. COUNSEL. THE CO-ORDINATE BENCH VIDE ORDER DATED 05.05.2017 IN ITA NO. 929/AHD/2012 HAS RESTORED THE ISSUE WITH THE FOLLOWING OBSERVATIONS:- 8. I N THE LIGHT OF THE ABOVE DISCUSSION, IF WE EXAMINE THE FACTS OF THE PRESENT CASE, THEN IT WOULD REVEAL THAT THE ALLEGED AGREEME NT/MOU WAS EXECUTED ON 5.7.2007. IT IS PLACED ON PAGE NO.5 TO 11 OF THE PA PER BOOK. THIS MEMORANDUM CONTAINS THAT SALE CONSIDERATION WOULD BE CALCULATE D AT THE RATE OF RS.1195/- PER SQ.METER. THE VENDEE HAS PAID AN AMOUNT OF RS.2 0 LAKHS BY CHEQUE BEARING NO.366815 DATED 12.4.2007 AND AMOUNT OF RS. 12 LAKHS THROUGH ACCOUNT PAYEE CHEQUE ON 23.5.2007. THEREAFTER SCHED ULE OF PAYMENT HAS BEEN GIVEN IN PARA-2 OF THE MEMORANDUM. THIS SCHEDU LE OF PAYMENT IS SUBSEQUENT TO ALLEGED EXECUTION OF THE SALE DEED. B UT ONE THING IS CLEAR FROM THIS MEMORANDUM, A RIGHT IN PERSONA HAS BEEN CREATE D IN FAVOUR OF THE VENDEE AS WELL AS IN FAVOUR OF THE VENDOR, WHICH HE CAN BE ENFORCED WITH THE HELP OF SUIT FOR SPECIFIC PERFORMANCE. IN SUCH SITU ATION, WE ARE OF THE VIEW THAT FAIR MARKET VALUE OF THIS PROPERTY OUGHT TO HAVE BE EN DETERMINED BY THE AO AS PROVIDED IN SECTION 50C(2). WE, THEREFORE, SET A SIDE THIS ISSUE TO THE FILE OF THE AO FOR RE-ADJUDICATION. THE ID.AO SHALL CALL FO R A REPORT FROM THE DVO AS ITA NO. 2225 /AHD/2014 . A.Y. 2008-09 3 CONTEMPLATED IN SECTION 50C(2) AND THE ID.DVO SHALL KEEP IN MIND ANY ENCUMBRANCE CREATED ON THE PROPERTY BY VIRTUE OF TH E ALLEGED EXECUTION OF THE AGREEMENT. IN THIS WAY, FIRST GRIEVANCE OF THE ASSE SSEE IS ALLOWED FOR STATISTICAL PURPOSE. 5. SINCE THE VERY BASIS OF THE LEVY OF PENALTY HAS BEE N SET ASIDE BY THE TRIBUNAL, IN OUR CONSIDERED OPINION, AS ON DATE, THERE IS NO ASS ESSMENT ORDER TO JUSTIFY THE LEVY OF PENALTY U/S. 271(1)(C) OF THE ACT. WE, THER EFORE, RESTORE THIS ISSUE TO THE FILES OF THE A.O. THE A.O. IS DIRECTED TO DECIDE TH E ISSUE OF THE LEVY OF PENALTY AFTER DECIDING THE QUANTUM ASSESSMENT AND AFTER GIV ING A REASONABLE AND SUFFICIENT OPPORTUNITY OF BEING HEARD TO THE ASSESS EE. 6. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS T REATED AS ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN OPEN COURT ON 31- 07-201 7 SD/- SD/- (S.S. GODARA) (N. K. BILLAIYA) JUDICIAL MEMBER TRUE COPY ACCOUNTANT MEMBER AHMEDABAD: DATED 31 /07/2017 RAJESH COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT,AHME DABAD