Rajendrasinh D Jadeja, Vadodara V. ITO, Ward-3(1)(1), Vadodara

ITA 2250/AHD/2018

AI Insights

The case involves Rajendrasinh D Jadeja, the appellant, contesting the assessment of Long Term Capital Gain (LTCG) and Short Term Capital Gain (STCG) by the Income Tax Officer for the Assessment Year 2010-11. The dispute arose from the sale of eight properties under a single sale deed, where the individual sale considerations were not specified. The Assessing Officer and CIT(A) calculated the assessee's share based on the total sale consideration and the area of the properties, leading to a disagreement on the assessed amounts. The Tribunal dismissed the appeal, supporting the lower authorities' calculations and decisions.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 129310 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 year(s) 1 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-01-2023
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Next Hearing Date: 03-01-2023
• Assessment Year: 2010-2011
• Appeal Filed On: 11-11-2018
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Sale consideration of property below Jantri Value; Capital asset; Cost of acquisition; Fair market value
• Section: 148; 50C; 142(1); 143(2)

Judgement Text

ITA No.2250/Ahd/2018 A.Y. 2010-11 Page 1 of 4 IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD “SMC” BENCH, AHMEDABAD BEFORE Ms. SUCHITRA KAMBLE, JUDICIAL MEMBER ITA No.2250/Ahd/2018 Assessment Year: 2010-11 Rajendrasinh D Jadeja, vs. Income Tax Officer, A/122, Pustidwar Society, Ward 3(1)(1), Vadodara. Nr. Bapod Jakat Naka, Waghodia Road, Vadodara – 390 019. [PAN – AGBPJ 8179 J] (Appellant) (Respondent) Assessee by : None Respondent by : Shri Atul Pandey, Sr. DR Date of hearing : 04.01.2023 Date of pronouncement : 11.01.2023 O R D E R This appeal is filed by the Assessee against the order dated 03.08.2018 passed by the CIT(A)-1, Vadodara for the Assessment Year 2010-11. 2. The grounds of appeal raised by the assessee are as under :- “1. Order passed by Learned Commissioner of Income Tax (Appeals) is bad in law as well as on facts. 2. On the facts and circumstances of the case, Learned Commissioner of Income Tax (Appeals) erred in not accepting amount of sale consideration of Rs.586362 calculated on the basis of area of each unit when eight properties owned by different persons were sold by a single sale deed in which property-wise sale consideration is not mentioned. He ought to have accepted the same. There was a sale of eight properties held by different owners by a single sale deed in which there was no mention of unit-wise sales consideration only total consideration of eight properties was mentioned. Further, there were eight owners of different property. Two of the properties ITA No.2250/Ahd/2018 A.Y. 2010-11 Page 2 of 4 were co-owned by five co-owners, assessee was one of these five co- owners. He was not sole owner of any of the properties. Alternatively, learned Assessing Officer had derived sale consideration by dividing total sales value by eight being no. of properties sold. He derived assessee’s share as 1/8 th of Rs.8903400.00 i.e. 12.50% of Rs.8903400. But, he failed to appreciate that two of the properties were owned by five co-owners, assessee was one of the co-owners in both properties. He was not sole owner of any of the properties. Hence, according to his method assessee’s share should be 5% and not 12.0%. Assessee is prepared to accept this 5% share in the total consideration. 3. Learned Commissioner of Income Tax (Appeals) erred in holding that amount of Rs.1015000.00 received by assessee against sale as sales consideration when Assessing Officer himself had held at para 2.2 of the assessment order that payment has not been made in commensuration with ownership and hence rejected this method of calculation. Actually, assessee was not having much details about sale and purchase value at the time of filing of return of income. Hence, he had taken amount received as sales consideration. But, during appellate proceeding, calculation of sales consideration based on area of each property was given. 4. Learned Commissioner of Income Tax (Appeals) erred in not giving any finding for not accepting amount of sale consideration calculated on the basis of area of each unit when eight properties owned by different persons were sold by a single sale deed in which property-wise sale consideration is not mentioned. According to this calculation share of assessee comes to 6.5858202% i.e. Rs.586362.00 5. Learned Commissioner of Income Tax (Appeals) erred in holding that amount received by assessee against sale as consideration without simultaneously accepting purchase cost claimed in return of income. If one part is accepted as correct then other apart should be also accepted as correct. Sale consideration calculated area-wise was rejected but purchase cost calculated on the same method, i.e. area-wise method is accepted. 6. Learned Commissioner of Income Tax (Appeals) erred in not accepting amount of sale consideration calculated on the basis of area of each unit when eight properties owned by different persons were sold by a single sale deed in which property-wise sale consideration is not mentioned while accepting purchase cost derived on the same basis as correct. Assessee had given calculation of sales consideration on the basis of area of each property and purchase cost on the same basis of area of property owned. Learned Commissioner of Income Tax (Appeals) rejected this calculation but accepted claim of purchase cost on the basis of this area-wise calculation.” ITA No.2250/Ahd/2018 A.Y. 2010-11 Page 3 of 4 3. The assessee did not file any return of income. The Assessing Officer issued notice under Section 148 of the Income Tax Act, 1961 on 18.11.2013 after recording reasons. In response, the assessee filed his return of income on 05.02.2015 declaring total income at Rs.1,48,590/- for Long Term Capital Gain (LTCG). Copy of reason was provided to the assessee vide letter dated 10.02.2015. Thereafter, notices under Sections 143(2) & 142(1) of the Act were issued from time to time. The assessee raised objections against reopening and the same was disposed by the Assessing Officer vide order dated 20.02.2015. After considering the submissions of the assessee, the Assessing Officer computed the LTCG after considering the share of the assessee at 16.60% out of fair market value under Section 50C of the Act at Rs. 89,03,400/- thereby making addition of Rs.9,64,335/- as LTCG. 4. Being aggrieved by the Assessment Order, the assessee filed appeal before the CIT(A). The CIT(A) partly allowed the appeal of the assessee. 5. At the time of hearing, none appeared on behalf of the assessee despite giving notices which was duly served. The acknowledgement card of the Postal Authorities is thereon record along with the Paper Book filed by the assessee dated 12.12.2022. Therefore, we are taking the appeal for hearing on the basis of the submissions made by the assessee before the Assessing Officer as well as before the CIT(A) which are quoted in the respective orders. 6. The Ld. DR submitted that the CIT(A) has taken all the aspects and the submissions made by the assessee and has passed the detailed order. The Ld. DR relied upon the Assessment Order and the order of the CIT(A). 7. Heard the Ld. DR and perused all the relevant material available on record. There is clear observation by the CIT(A) that the assessee has admitted that the capital asset was sold within the period of less than 3 years and, therefore, assessee computed the short term capital gain at Rs.5,46,377/-. However, the CIT(A) categorically pointed out that the share of the assessee in shop no.1 and Shop nos.1 to 6 was not specified either in the purchase deed or in the sale deed and, therefore, only option available is the amount of sale consideration received by the assessee vis- à-vis other co-owners. As it is evident from the sale deed as well as from the ITA No.2250/Ahd/2018 A.Y. 2010-11 Page 4 of 4 assessment order, the assessee has received sale consideration by cheque at Rs.10,15,000/-. As the assessee also admitted the case of acquisition at Rs.39,984/- being the share of assessee and there is no claim for any cost of improvement and hence the Assessing Officer was rightly directed by the CIT(A) to adopt cost of acquisition at Rs.39,984/- for computation of STCG. The contention of the assessee that two of the properties owned by 5 co-owners and the assessee was one of the co-owner in one of the property has not been clarified from the record. The assessee did not explain his contention with the documentary evidence before both the Authorities and, therefore, the CIT(A) has rightly sustained the addition with the directions to the Assessing Officer. There is no need to interfere with the same. Hence, appeal of the assessee is dismissed. 8. In the result, appeal filed by the assessee is dismissed. Order pronounced in the open Court on this 11 th day of January, 2023. Sd/- (SUCHITRA KAMBLE) Judicial Member Ahmedabad, the 11 th day of January, 2023 PBN/* Copies to: (1) The appellant (2) The respondent (3) CIT (4) CIT(A) (5) Departmental Representative (6) Guard File By order UE COPY Assistant Registrar Income Tax Appellate Tribunal Ahmedabad benches, Ahmedabad