A.C.I.T.-Circle-2, Jalpaiguri, Jalpaiguri V. Shri Sona Saha, Uttar Dinajpur

ITA 23/KOL/2014

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 9759 (ITAT-KOLKATA)
• Duration Of Justice: 5 year(s) 5 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-07-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2010-2011
• Appeal Filed On: 06-01-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: C J SINGH
• Keywords: Sale consideration of property below Jantri Value; Value adopted by valuation officer; Business income; Search and seizure; Fair market value; Assessment record; Set aside
• Section: 50C; 133(6); 69B; 131; 132

Judgement Text

1 ITA NO. 23/KOL/2014 & CO. 18/KOL/2014 SONA SAHA., AY 2010-11 , A , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH: KOL KATA ( ) . . , . ' # $% % , '( ) [BEFORE SHRI A. T. VARKEY, JM & DR. A. L. SAINI, A M] I.T.A. NO. 23/KOL/2014 ASSESSMENT YEAR: 2010-11 ASSISTANT COMMISSIONER OF INCOME-TAX, CIRCLE-2, JALPAIGURI VS. SHRI SONA SAHA, PROP. M/S. SONA PLYWOOD INDUSTRIES & M/S. SONA BRICK ENTERPRISE (PAN: AMGPS5893K) APPELLANT RESPONDENT & CO. NO. 18/KOL/2014 IN I.T.A. NO. 23/KOL/2014 ASSESSMENT YEAR: 2010-11 SHRI SONA SAHA VS. ASSISTANT COMMISSIONER OF INCOM E-TAX, CIRCLE-2, JALPAIGURI CROSS OBJECTOR RESPONDENT DATE OF HEARING 10.04.2019 DATE OF PRONOUNCEMENT 01.07.2019 FOR THE REVENUE SHRI C. J. SINGH, JCIT, SR. DR FOR THE ASSESSEE/CROSS OBJECTOR SHRI SOMNATH GHOSH, ADVOCATE ORDER PER SHRI A.T.VARKEY, JM THE APPEAL PREFERRED BY THE REVENUE AND THE CROSS O BJECTION BY THE ASSESSEE ARE AGAINST THE ORDER OF THE LD. CIT(A), JALPAIGURI DAT ED 22.10.2013 FOR AY 2010-11. 2. FIRST WE TAKE UP REVENUES APPEAL. THE REVISED GROUND NO. 1 OF APPEAL FILED BY THE REVENUE IS AS UNDER: 1. LD. CIT(A) HAS ERRED IN DELETING THE UNEXPLAIN ED RECEIPT IN BRICK MANUFACTURING AMOUNTING TO RS.9,84,536/- ON THE GROUND THAT RECEI PTS WERE BOOKED IN THE BOOKS OF ACCOUNTS AND CONSIDERED FOR TAXATION BY THE ASSESSEE. LD. C IT(A) COULD NOT APPRECIATE THE FACT THAT 2 ITA NO. 23/KOL/2014 & CO. 18/KOL/2014 SONA SAHA., AY 2010-11 THE ASSESSEE COULD NOT PRODUCE ANY SUPPORTING EVIDE NCE FOR THOSE RECEIPTS OR COULD NOT PRODUCE ANY PRODUCTION DETAILS. 3. WE HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. WE NOTE THAT THE ASSESSEE IS ALSO IN THE BU SINESS OF BRICK MANUFACTURING AND SALES. WE NOTE THAT THE LD. CIT(A) HAS NOTED THAT THE ADDI TION HAS BEEN MADE BY AO ONLY ON THE BASIS OF THE STATEMENT OF THE ASSESSEE ON 07.03.201 3 WHICH CANNOT BE TAKEN AS CONCLUSIVE EVIDENCE OF THE FACTS STATED THEREIN AND THAT TOO W HEN HE WAS UNWELL AND IT WAS SUBMITTED THAT OTHER THAN THIS ERRONEOUS STATEMENT THERE WAS NO MATERIAL TO MAKE THE ADDITION. ACCORDING TO THE LD. AR, THE CONFUSION OF THE ASSES SEE WHILE ANSWERING THE QUESTION OF THE AO WAS THE BASIS FOR THE ADDITION MADE. ACCORDING TO LD AR, THE AO NOTED THAT THE ASSESSEE HAD AN OPENING BALANCE IN RESPECT OF BRICK MANUFACTURING OF RS.2,80,764/- AS ON 01.04.2009 AND WAS OF THE ERRONEOUS BELIEF BASED ON THE ASSESSEES WRONG STATEMENT THAT NO FIRING TOOK PLACE BETWEEN 1 ST APRIL & DECEMBER 2009, MADE UP HIS MIND THAT ASSES SEE HAD NOT MANUFACTURED ANY BRICKS BETWEEN 1 ST APRIL AND DECEMBER, 2009 BECAUSE OF ADVERSE WEATHER CLIMATES SINCE NO FIRING COULD TAKE PLACE A T THAT PERIOD OF TIME. ACCORDING TO LD. AR, AO HAD ASSUMED WRONG FACTS ABOUT THE ADVERSE WEATHE R CONDITIONS BETWEEN 1 ST APRIL AND DECEMBER, 2009 TO COME TO CONCLUSION THAT ASSESSEE HAD NOT MANUFACTURED ANY BRICKS BETWEEN 1 ST APRIL AND DECEMBER, 2009 WHEREAS THE CORRECT RAINY SEASON IS ONLY FOR A SHORT DURATION OF THREE MONTHS; AND THAT WHEN THE ASSESSE E IN A CONFUSED STATE OF MIND WRONGLY STATED THAT NO FIRING TOOK PLACE BETWEEN 1 ST APRIL & DECEMBER 2009, THE AO HAD DRAWN WRONG ASSUMPTION AND MADE ADDITION. HOWEVER, IT WAS BROUGHT TO OUR NOTICE THE FACT THAT THE ASSESSEE HAD MANUFACTURED AND SOLD BRICKS VALU ED AT RS.11,75,300/- BETWEEN 1 ST APRIL AND DECEMBER, 2009 AND TOTAL SALES WAS TO THE TUNE OF RS.17,85,500/- AND SO THE ASSESSEE STATED THAT THE AVERMENT THAT NO FIRING TOOK PLACE BETWEEN 1 ST APRIL AND DECEMBER, 2009 IS FACTUALLY ERRONEOUS. FROM THE MATERIALS ON RECORD S HOWS THAT THE ASSESSEE HAD MANUFACTURED & SOLD BRICKS BETWEEN 1 ST APRIL & DECEMBER, 2009 AS STATED (SUPRA), SO, THE AO HAS MADE THE ADDITION BASED ON WRONG STATEMENT OF ASSESSEE W HEN HE WAS UN-WELL AND ONLY BY BRINGING IN HIS GENERAL KNOWLEDGE OF ADVERSE WEATHE R CONDITION BETWEEN 1 ST APRIL AND DECEMBER, 2009 WHEREAS THE RAINY SEASON IS EXISTING FOR THREE MONTHS WHEN FIRING DOES NOT TAKE PLACE CONSEQUENTLY NO MANUFACTURE OF BRICKS TA KES PLACE AND NOT AS CONCLUDED BY AO. 3 ITA NO. 23/KOL/2014 & CO. 18/KOL/2014 SONA SAHA., AY 2010-11 WE NOTE THAT THE LD. CIT(A) HAS APPRECIATED ALL THE SE FACTS TO JUSTIFY THE DELETION, SO WE SUSTAIN HIS ORDER ON THIS GROUND. THEREFORE, THIS G ROUND OF APPEAL OF REVENUE IS DISMISSED. 4. THE REVISED GROUND NO. 2 OF APPEAL FILED BY THE REVENUE IS AS UNDER: 2. IN THE FACTS AND CIRCUMSTANCES LD. CIT(A) HAS ERRED IN DELETING RS.59,57,797/- RELYING ON THE TYPOGRAPHICAL MISTAKE OF DATE IN ORDER SHEET FO R RECORDING HEARING AND IN STATEMENT WHICH IS A TECHNICAL ERROR WITHOUT APPRECIATING THE FACTS THAT THE ASSESSEE HAD FAILED TO PRODUCE ANY DOCUMENTARY EVIDENCE IN SUPPORT OF LOSS IN MAIZE BU SINESS. 5. WE HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUGH THE FACTS AND CIRCUMSTANCES OF THE CASE. WE NOTE THAT THE ASSESSEE IS AN EXPORTER ALS O AND HE GOT AN EXPORT ORDER FROM BANGLADESH SO, HE PURCHASED JUTE AND MAIZE. LATER SINCE THE NEGOTIATION OF PRICE COULD NOT BE AGREED UPON BETWEEN THE IMPORTER AND THE ASSESSE E, THE EXPORT OF THE GOODS COULD NOT MATERIALIZE. THEREFORE, ASSESSEE HAD NO OTHER ALTE RNATIVE BUT TO GO FOR DISTRESS SALE BECAUSE THE JUTE AS WELL AS THE MAIZE IS PERISHABLE ITEM. IT WAS BROUGHT TO OUR NOTICE THAT AO DID NOT QUESTION DURING THE COURSE OF ASSESSMENT PROCEEDING S THE VERACITY OF THE AFORESAID FACTS AND CIRCUMSTANCES THAT LED TO THE SELLING OF JUTE AND M AIZE FOR LOSS. HOWEVER, ON 13.03.2013 AN INSPECTOR WAS DEPUTED WHO HAD GIVEN A REPORT ON 14. 03.2013 STATING THAT THE 73 SUPPLIERS OF JUTE COULD NOT BE TRACED OUT AND THE PRICE OF JUTE WHEN ENQUIRED FROM 3 PARTIES REVEALED THAT IT WAS IN THE RANGE OF RS. 1010 TO RS. 1100 PER QUI NTAL. THIS REPORT OF INSPECTOR LED THE AO TO DRAW ADVERSE VIEW AGAINST THE ASSESSEE. HOWEVER WE NOTE THAT THE LD. CIT(A) HAS IN DEPTH ANALYZED THE REPORT OF THE INSPECTOR AND CAME TO A FINDING THAT IT CANNOT BE THE BASIS FOR MAKING THE ADDITION. WE NOTE THAT THE OBSERVAT ION OF THE LD. CIT(A) GIVEN IN PARA 6.1.3 OF HIS ORDER AND PAGE 186 OF THE PAPER BOOK OF THE ASSESSEE REVEAL THAT THE INSPECTORS REPORT CANNOT BE RELIED UPON TO DRAW ADVERSE VIEW AGAINST THE ASSESSEE. IT WAS BROUGHT TO OUR NOTICE THAT FEW SUPPLIERS IN FACT HAD CONFIRMED THE SALE OF JUTE AND MAIZE TO THE ASSESSEE PURSUANT TO NOTICE U/S 133(6) BY AO AND EVEN TWO PA RTIES OUT OF THREE HAVE GIVEN TESTIMONY BEFORE THE LD. CIT(A) THAT THEY HAVE NOT GIVEN ANY STATEMENT OF PRICE OF JUTE DURING THE YEAR 2009 TO ANY INSPECTOR OF INCOME TAX AND THE PRICE W AS RANGING BETWEEN RS. 550 TO RS. 600. AND THE LD. CIT(A) HAS TAKEN NOTE OF ANOTHER FACT T HAT THE INSPECTOR FAILED TO SUBMIT IN HIS REPORT ON 13.03.2013 THAT THERE WAS FIRE IN THE FA CTORY PREMISE OF ASSESSEE ON 13.03.2013, WHICH COULD NOT HAVE GONE UNNOTICED BY THE INSPECTO R IF HE HAD VISITED THE PLACE FOR 4 ITA NO. 23/KOL/2014 & CO. 18/KOL/2014 SONA SAHA., AY 2010-11 VERIFICATION / ENQUIRY. IN THE AFORESAID CIRCUMSTAN CES, WE NOTE THAT THE LD. CIT(A) HAS DELETED THE ADDITION BY OBSERVING AS UNDER: 6.1.3. THE EVIDENCE HEAVILY RELIED UPON BY THE AO IS INSPECTOR'S REPORT DATED 14/3/2013. AS PER THIS REPORT, THE INSPECTOR VISITED 73 PERSONS W HOSE NAMES APPEAR IN THE BOOKS OF ACCOUNT AND FROM WHOM THE ASSESSEE HAD PURCHASED JUTE. ALL THE PERSONS HAVE BEEN STATED TO HAVE THE ADDRESS 'BARDUARY, MDHUPUR, RAIGANJ WHICH INCIDEN TALLY ALSO HAPPENS TO BE THE ADDRESS OF ASSESSEE. THIS VERIFICATION OF 73 PERSONS HAS BEEN STATED TO HAVE BEEN CARRIED OUT ON ONE DAY I.E. 13/3/2013. THE LIST ALSO CONTAINS THE NAMES OF TWO PERSONS VIZ. SH JANARDAN SINGH (SERIAL NUMBER 49) AND SH SADHAN CHANDRA CHOWDHURY (SERIAL NUMBER 62). THESE TWO PERSONS HAD ALREADY CONFIRMED THEIR TRANSACTION WITH ASSESSEE T O THE AO IN RESPONSE TO NOTICES U/S 133(6) BEFORE THE SAID VISIT OF THE INSPECTOR. THESE PERSO NS HAVE ALSO BEEN STATED TO NE NON-EXISTENT ALON GWITH OTHER 71 IN THE LIST. IN PARA 2 OF THE R EPORT, THE INSPECTOR HAS MENTIONED THAT HE HAD ENQUIRED FROM M/S RANI SATI TRADE & INVESTMENT, M/S AVA EXPORTS P LTD AND SH. BAJRANG LADDA ABOUT THE PRICE OF MAIZE IN NOV 2009. THE INS PECTOR HAS MENTIONED THAT THESE PERSONS STATED THAT THE PRICE OF MAIZE IN NOV 2009 WAS RS. 1010 TO RS.1100 PER QUINTAL. OUT OF THESE THREE PARTIES, TWO VIZ. M/S RANI SATI TRADE & INVES TMENT AND M/S AVA EXPORTS P LTD HAVE BEEN PRODUCED BEFORE THE UNDERSIGNED AND THEY HAVE STATE D THAT NO ONE APPROACHED THEM FROM INCOME TAX DEPARTMENT FOR ENQUIRING THE PRICE OF MA IZE AND THEY HAVE NEVER GIVEN ANY INFORMATION TO INCOME TAX DEPARTMENT ABOUT THE PRIC E OF MAIZE. THEY SUBMITTED BEFORE THE UNDERSIGNED THAT THE PRICE OF MAIZE DURING NOV 2009 WAS IN THE RANGE OF RS 550 TO RS 600. THESE SUBMISSIONS WERE FORWARDED TO THE AO FOR COM MENTS. THE AO HAS NOT COMMENTED ON THESE SUBMISSIONS. MOST IMPORTANTLY, THE INSPECTOR HAS STATED TO HAVE VISITED THESE 73 PERSONS WHOSE ADDRESSES ARE THE SAME AS THAT OF THE ASSESSE E ON 13/3/2013 AND AS PER THE REPORT OF FIRE STATION, THE FACTORY PREMISES OF THE ASSESSEE CAUGHT FIRE IN VERY EARLY HOURS OF 13.03.2013. THE INSPECTORS REPORT DOES NOT MENTIO N THIS FACT. SUCH AN EVENT CANNOT ESCAPE THE ATTENTION OF INSPECTOR, IF HE HAD ACTUALLY VISI TED THAT PLACE. IN VIEW OF THESE CONTRADICTIONS, NO EVIDENTIARY VALUE CAN BE GIVEN TO THE INSPECTOR S REPORT DATED 14.03.2013. 6.3. DISALLOWANCE OF LOSS OF RS. 59,57,797 FROM TRA DE IN SEASONAL CROPS- THIS DISALLOWANCE IS MADE SOLELY ON THE BASIS OF THE STATEMENT OF ASSESS EE U/S 131 AND THE REPORT OF THE INSPECTOR. AS HAS BEEN SEEN THE PARA 6.1, BOTH THESE DOCUMENTS ARE NOT RELIABLE EVIDENCE AND THERE ARE FACTUAL INACCURACIES. THE EVIDENCE FURNISHED BY THE ASSESSEE HAS BEEN COMMENTED UPON BY THE AO IN HIS REMAND REPORT. THE AO HAS NOT REBUTTED TH ESE EVIDENCES. THE QUANTIFICATION OF THIS LOSS IS DONE BY THE AO HIMSELF ON THE BASIS OF SURM ISES AND CONJECTURES. THEREFORE, THIS FIGURE OF LOSS CALCULATED BY THE AO IS ARBITRARY. THE ACTI ON OF THE AO ON THIS ARBITRARY ADDITION IS ANNULLED. 6. THE LD. DR COULD NOT CONTROVERT THE FINDING OF T HE LD. CIT(A) BY PRODUCING ANY MATERIAL BEFORE US OR POINT OUT ANY ERROR IN FACTS OR LAW, SO THE FINDING OF FACT RENDERED BY THE LD. CIT(A) CANNOT BE HELD TO BE PERVERSE IN VIE W OF THE CONFIRMATION OF PURCHASES BY SH. JANARDAN SINGH AND SH. SADHAN CHANDRA CHOWDHURY TO THE AO PURSUANT TO NOTICE U/S 133(6) OF THE ACT AND STATEMENT OF TWO PARTIES BEFO RE THE LD. CIT(A) IN RESPECT TO THE PRICE OF JUTE AND THEIR ASSERTION THAT THEY HAVE NOT MADE ANY STATEMENT TO INSPECTOR WHO PREPARED THE REPORT WHICH WAS IN TURN HEAVILY RELIED BY AO T O DRAW ADVERSE VIEW AGAINST THE ASSESSEE 5 ITA NO. 23/KOL/2014 & CO. 18/KOL/2014 SONA SAHA., AY 2010-11 WAS RIGHTLY DISCARDED BY THE LD. CIT(A) AND THEREF ORE, WE FIND NO INFIRMITY IN THE ORDER OF LD. CIT(A) AND THE SAME IS HEREBY UPHELD. THIS GRO UND OF APPEAL OF REVENUE IS DISMISSED. 7. THE REVISED GROUND NO. 3 OF APPEAL FILED BY THE REVENUE IS AS UNDER: 3. LD. CIT(A) HAS ERRED IN LAW BY DELETING THE AD DITION MADE ON ACCOUNT OF UNACCOUNTED JEWELLERY WHILE ASSESSEE COULD NOT PRODUCE ANY SOUR CE OF INCOME FROM WHICH THE JEWELLERY AMOUNTING TO RS.81,000/- WAS EARNED AS WELL AS FAIL ED TO FURNISH ANY EVIDENCE WHICH PROVED THAT THE JEWELLERY WAS ACQUIRED FROM HIS ANCESTORS. 8. WE HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUGH THE FACTS AND CIRCUMSTANCES OF THE CASE. WE NOTE THAT THE AO HAD MADE AN ADDITION OF RS.81,000/- INVOKING THE PROVISIONS OF SEC. 69B OF THE ACT THAT THE SOURCE OF JEWELLERY WE IGHING 50 GMS BELONGING TO ASSESSEE AS UNEXPLAINED. DURING THE COURSE OF DEPOSITION U/S. 131 OF THE ACT THE ASSESSEE HAD ADMITTED OF HAVING 150 GMS OF JEWELLERY. ACCORDING TO THE A O 100 GRAMS IS EXPLAINED IN VIEW OF THE CBDT CIRCULAR AND REMAINING 50 GRAMS WAS UNEXPLAINE D. SO HE MADE AN ADDITION OF THE VALUE OF 50 GRAMS OF GOLD AND MADE AN ADDITION OF R S. 81,000/-. ON APPEAL, THE LD. CIT(A) DELETED THE ADDITION BY OBSERVING AS UNDER: 6.4. ON PERUSAL OF ASSESSMENT RECORD, IT IS SEEN THAT THE ASSESSEE IN HIS WRITTEN SUBMISSION DATED 27.02.2013 I.E PRIOR TO RECORDING OF HIS STA TEMENT U/S. 131 HAS STATED THAT HE HAS GOT APPROXIMATELY 150 GRAMS OF GOLD JEWELLERY AND HE D OES NOT FILE WT RETURN (PAGE 332 OF ASSESSMENT RECORD). THE AO DID NOT ASK THE ASSESSE E TO SUBMIT THE TIME(S) OF ACQUISITION OF THIS JEWELLERY. THE ASSESSEE WAS NOT ASKED THIS QU ESTION IN DURING THE COURSE OF RECORDING OF HIS STATEMENT WHICH WAS DONE SUBSEQUENTLY. THE INS TRUCTION OF CBDT FOR NOT SEIZING THE JEWELLERY UPTO 100 GRAMS EVEN IF UNACCOUNTED, DURIN G THE COURSE OF SEARCH U/S. 132 IS USED OUT OF CONTEXT. THE AO WAS DOING ASSESSMENT U/S. 1 43(3) AND NOT SEARCH AND SEIZURE OPERATION U/S. 132. THE SUBMISSION OF THE ASSESSEE DURING THE COURSE OF ASSESSMENT NEVER INDICATED THAT THE SAID JEWELLERY OF 150 GRAMS WAS PURCHASED BY HIM DURING THE PERIOD RELEVANT TO THIS AY. SO, HOW IS THIS INFERENCE DRAW N? MORE SO, WHEN THE AO DID NOT ASK HIM TO SUBMIT THE PERIOD OF ITS ACQUISITION. THIS ADDITIO N IS THEREFORE, MADE ON THE BASIS SURMISES AND CONJECTURES. THE AO IS DIRECTED TO DELETE THIS ADD ITION. 9. THE LD. DR COULD NOT CONTROVERT THE FINDING OF T HE LD. CIT(A) BY PRODUCING ANY MATERIAL BEFORE US OR POINT OUT ANY ERROR IN THE IM PUGNED ORDER OF LD. CIT(A) AND WE CONCUR WITH THE LD. CIT(A) THAT MERELY BECAUSE THE ASSESSE E HAD GIVEN A WRITTEN SUBMISSION (BEFORE STATEMENT WAS RECORDED) WHEREIN HE HAD STATED THAT HE HAD APPROX 150 GMS OF GOLD, THE AO OUGHT NOT TO HAVE MADE THE ADDITION OF VALUE OF 50 GMS OF GOLD WITHOUT ASKING THE PERTINENT QUESTION AS TO WHEN THIS GOLD WAS ACQUIRE D BY HIM. SO THE BASIS OF ADDITION WAS 6 ITA NO. 23/KOL/2014 & CO. 18/KOL/2014 SONA SAHA., AY 2010-11 WITHOUT ANY MATERIAL / EVIDENCE AND THE LD. CIT(A) RIGHTLY DELETED THE ADDITION AND THEREFORE, WE FIND NO INFIRMITY IN THE ORDER OF LD. CIT(A) AND THE SAME IS HEREBY UPHELD. THIS GROUND OF APPEAL OF REVENUE IS DISMISSED. 10. COMING TO THE ASSESSEES CROSS OBJECTION. GROU NDS OF THE ASSESSEES CROSS OBJECTION IS AS UNDER: 1. FOR THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A), JALPAIGURI FAILED TO APPRECIATE THAT THE PURPORTED INVOCATION OF THE PROVISIONS OF S. 50C OF THE INCOME TAX ACT, 1961 IN THE INSTANT CASE BY THE LD. ASSIST ANT COMMISSIONER OF INCOME TAX, CIRCLE-2, JALPAIGURI AND THEREBY RESORTING TO AN ADDITION OF RS.1,07,195/- ON THAT ACCOUNT BASING ON EXTRANEOUS CONSIDERATIONS NOT GERMANE TO THE ISSUE IN DISPUTE IS COMPLETELY UNFOUNDED, UNJUSTIFIED AND UNTENABLE IN LAW. 2. FOR THAT THE LD. COMMISSIONER OF INCOME TAX (AP PEALS) JALPAIGURI FAILED TO GRASP THE FACTUM AND EXTENT OF THE EXPENDITURE UNDERTAKEN BY THE ASSESSEE IN THE SUM OF RS. 4,64,581/- ON ACCOUNT OF LAND DEVELOPMENT EXPENSES AND THE ADD ITION MADE IN THE SUM OF RS. 5,63,481/- IN THAT RESPECT BY THE LD. ASSISTANT COMMISSIONER O F INCOME TAX, CIRCLE 2, JALPAIGURI IS TOTALLY IRRATIONAL, ILLEGITIMATE AND INFIRM IN LAW. 3. FOR THAT THE LD. COMMISSIONER OF INCOME TAX (APP EALS) JALPAIGURI ACTED UNLAWFULLY IN UPHOLDING THE DISALLOWANCE OF EXPENDITURE IN THE AM OUNT OF RS. 5,63,581/- MADE BY THE LD. ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 2, JAL PAIGURI IN STEAD AND PLACE OF THE ACTUAL CLAIM OF RS.4,64,581/- ON ACCOUNT OF LAND DEVELOPME NT ON A WRONG APPRECIATION OF FACTS AND WITHOUT CONSIDERING IMPECCABLE EVIDENCE ON RECORD A ND NOT ALLOWING THE ASSESSEE DUE OPPORTUNITY TO CONTROVERT HIS SPECIOUS FINDINGS ON THE ISSUE AND AS SUCH THE PURPORTED CONCLUSION REACHED ON THAT BEHALF ARE ABSOLUTELY AR BITRARY, UNWARRANTED AND PERVERSE. 11. WE HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUG H THE FACTS AND CIRCUMSTANCES OF THE CASE. WE NOTE THAT THE AO HAS MADE THE ADDITION U/ S. 50C WITHOUT REFERRING TO THE DVO. THE HONBLE CALCUTTA HIGH COURT IN THE CASE OF SUNI L KR. AGARWAL VS. CIT IN GA NO.3686 OF 2013 ITAT NO.221 OF 2013 VIDE JUDGMENT DATED 13. 03.2014 HAS HELD THAT BEFORE INVOKING SEC. 50C OF THE ACT, THE AO HAS TO REFER T HE VALUATION TO THE DVO. THE HONBLE JURISDICTIONAL HIGH COURT IN SUNIL KR. AGARWAL, CIT ED SUPRA, HAS HELD AS UNDER: WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ADVANCED BY THE LEARNED ADVOCATES APPEARING FOR THE PARTIES. THE SUBMISSION OF MS. GHUTGHUTIA THAT THE REQUIREMENT OF CLAUSES A) AND (B) OF SUB-SECTION 2 OF SECTION 50C HAS NOT BEEN MET BY TH E ASSESSEE, CAN HARDLY BE ACCEPTED. THE REQUIREMENT OF CLAUSE (B) OF SUB-SECTION 2 OF SECTI ON 50C WAS EVIDENTLY MET. THE ONLY QUESTION IS WHETHER THE REQUIREMENT OF CLAUSE (B) OF SUB-SEC TION 2 OF SECTION 50C WAS EVIDENTLY MET. THE ONLY QUESTION IS WHETHER THE REQUIREMENT OF CLA USE (A) OF SUB-SECTION 2 OF SECTION 50C WAS MET BY THE ASSESSEE. WE HAVE ALREADY SET OUT HEREINABOVE THE RECITAL APP EARING IN THE DEEDS OF CONVEYANCE UPON WHICH THE ASSESSEE WAS RELYING. PRESUMABLY, THE CAS E OF THE ASSESSEE WAS THAT PRICE OFFERED BY 7 ITA NO. 23/KOL/2014 & CO. 18/KOL/2014 SONA SAHA., AY 2010-11 THE BUYER WAS THE HIGHEST PREVAILING PRICE IN THE M ARKET. IF THIS IS HIS CASE THEN IT IS DIFFICULT TO ACCEPT THE PROPOSITION THAT THE ASSESSEE HAD ACCEPT ED THAT THE PRICE FIXED BY THE DISTRICT SUB REGISTRAR WAS THE FAIR MARKET VALUE OF THE PROPERTY . NO SUCH INFERENCE CAN BE MADE AS AGAINST THE ASSESSEE BECAUSE HE HAD NOTHING TO DO IN THE MA TTER. STAMP DUTY WAS PAYABLE BY THE PURCHASER. IT WAS FOR THE PURCHASER TO EITHER ACCEP T IT OR DISPUTE IT. THE ASSESSEE COULD NOT, ON THE BASIS OF THE PRICE FIXED BY THE SUB-REGISTRAR, HAVE CLAIMED ANYTHING MORE THAN THE AGREED CONSIDERATION OF A SUM OF RS.10 LAKHS WHICH, ACCORD ING TO THE ASSESSEE, WAS THE HIGHEST PREVAILING MARKET PRICE. IT WOULD FOLLOW AUTOMATICA LLY THAT HIS CASE WAS THAT THE FAIR MARKET VALUE OF THE PROPERTY COULD NOT BE RS.35 LAKHS AS A SSESSED BY THE DISTRICT SUB REGISTRAR. IN A CASE OF THIS NATURE THE ASSESSING OFFICER SHOULD, I N FAIRNESS, HAVE GIVEN AN OPTION TO THE ASSESSEE TO HAVE THE VALUATION MADE BY THE DEPARTME NTAL VALUATION OFFICER CONTEMPLATED UNDER SECTION 50C. AS A MATTER OF COURSE, IN ALL SUCH CAS ES THE ASSESSING OFFICER SHOULD GIVE AN OPTION TO THE ASSESSEE TO HAVE THE VALUATION MADE B Y THE DEPARTMENTAL VALUATION OFFICER. FOR THE AFORESAID REASONS, WE ARE OF THE OPINION TH AT THE VALUATION BY THE DEPARTMENTAL VALUATION OFFICER, CONTEMPLATED UNDER SECTION 50C, IS REQUIRED TO AVOID MISCARRIAGE OF JUSTICE. THE LEGISLATURE DID NOT INTEND THAT THE CAPITAL GAI N SHOULD BE FIXED MERELY ON THE BASIS OF THE VALUATION TO BE MADE BY THE DISTRICT SUB REGISTRAR FOR THE PURPOSE OF STAMP DUTY. THE LEGISLATURE HAS TAKEN CARE TO PROVIDE ADEQUATE MACH INERY TO GIVE A FAIR TREATMENT TO THE CITIZEN/TAXPAYER. THERE IS NO REASON WHY THE MACHIN ERY PROVIDED BY THE LEGISLATURE SHOULD NOT BE USED AND THE BENEFIT THEREOF SHOULD BE REFUSED. EVEN IN A CASE WHERE NO SUCH PRAYER IS MADE BY THE LEARNED ADVOCATE REPRESENTING THE ASSES SEE, WHO MAY NOT HAVE BEEN PROPERLY INSTRUCTED IN LAW, THE ASSESSING OFFICER, DISCHARGI NG A QUASI JUDICIAL FUNCTION, HAS THE BOUNDEN DUTY TO ACT FAIRLY AND TO GIVE A FAIR TREATMENT BY GIVING HIM AN OPTION TO FOLLOW THE COURSE PROVIDED BY LAW.(EMPHASIS GIVEN BY US). 12. THEREFORE IN THE LIGHT OF THE AFORESAID FACTS AND CIRCUMSTANCES OF THE CASE AND RELYING ON THE DECISION OF THE HONBLE HIGH COURT IN SUMIT KR. AGARWAL, SUPRA, WE SET ASIDE THE ORDER OF THE LD. CIT(A) ON THE AFORESAID ISSUES RAI SED IN THE CROSSOBJECTION BY ASSESSEE AND REMAND THE MATTER BACK TO THE FILE OF THE AO WITH A DIRECTION TO REFER THE MATTER TO DVO FOR HIS REPORT AND THEREAFTER ASSESS THE CAPITAL GAIN I F ANY AFTER GOING THROUGH THE DVO REPORT AND HEARING THE ASSESSEE AND THEREAFTER TO COMPUTE LTCG IN ACCORDANCE TO LAW. 13. IN THE RESULT, THE APPEAL OF REVENUE IS DISMISS ED AND CROSS OBJECTION OF ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER IS PRONOUNCED IN THE OPEN COURT ON 1 ST JULY, 2019. SD/- SD/- (DR. A. L. SAINI) (ABY. T. VARKEY) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 1ST JULY, 2019 JD.(SR.P.S.) 8 ITA NO. 23/KOL/2014 & CO. 18/KOL/2014 SONA SAHA., AY 2010-11 COPY OF THE ORDER FORWARDED TO: 1. APPELLANT ACIT, CIRCLE-2, JALPAIGURI 2 RESPONDENT SHRI SONA SAHA, PROP. M/S. SONA PLYW OOD INDUSTRIES & M/S. SONA BRICK ENTERPRISE, C/O, S. N. GHOSH & ASSO CIATES, ADVOCATES, SEVEN BROTHERSBODGE, P.O. BUROSHIBTALA, PS. CHINSU RAH, DIST. HOOGHLY, PIN-712105 3. 4. 5. CIT(A), JALPAIGURI (SENT THROUGH E-MAIL) CIT, JALPAIGURI. DR, ITAT, KOLKATA. (SENT THROUGH E-MAIL) / TRUE COPY, BY ORDER, ASSISTANT REGISTRAR