Gandamalla Renuka , Hyderabad V. Income Tax Officer, Ward-4(3), Hyderabad

ITA 2310/Hyd/2018

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 5910 (ITAT-HYDERABAD)
• Duration Of Justice: 9 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-09-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB-A
• Next Hearing Date: 23-07-2019
• Assessment Year: 2015-2016
• Appeal Filed On: 12-12-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R.S. ARVINDAKSHAN
• Keywords: Gift; Capital Gains
• Section: 143(3); 133A; 101; 20

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH SMC, HYDERABAD BEFORE SHRI A. MOHAN ALANKAMONY ACCOUNTANT MEMBER ITA NO. 2310 /HYD/20 18 ASSESSMENT YEAR: 20 15 - 16 GANDAMALLA RENUKA, HYDERABAD. PAN: ADJPG 5988 M VS. INCOME TAX OFFICER, WARD - 4(3), HYDERABAD. (APPELLANT) (RESPONDENT) ASSESSEE BY: SMT. S. SANDHYA REVENUE BY: SHRI R.S. ARVINDAKSHAN, DR DATE OF HEARING: 23/07/2019 DATE OF PRONOUNCEMENT: 24 /0 9 /2019 ORDER PER A. MOHAN ALANKAMONY, AM.: THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE ORDER OF THE LD. CIT(A) - 1, HYDERABAD DATED 13/11/2018 IN APPEAL NO. 0244/17 - 18/ITO, WARD - 4(3)/CIT(A) - 1/HYD/2018 - 19 PASSED U/S. 143(3) R.W.S 250(6) OF THE ACT FOR THE ASSESSMENT YEAR 2015 - 16. 2. IN THIS APPEAL, T HE ASSESSEE HAS RAISED FIVE GROUNDS IN HER APPEAL HOWEVER THE CRUX OF THE ISSUE IS THAT THE LD. CIT(A) HAS ERRED IN CONFIRMING THE ORDER OF THE LD. A.O. WHO HAD ENHANCED THE SHORT TERM CAPITAL GAINS COMPUTED BY THE ASSESSEE BY TREATING THE SALE 2 CONSIDERATI ON AS RS. 56 LAKHS AS AGAINST RS. 37 LAKHS DECLARED BY THE ASSESSEE. 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS AN INDIVIDUAL EARN ING INCOME FROM HOUSE PROPERTY AND SHORT - TERM CAPITAL GAINS FILED HER RETURN OF INCOME ON 23/08/2017 FOR THE RELEVAN T ASSESSMENT YEAR DECLARING INCOME OF RS. 6,34,530/ - [INCOME FROM HOUSE PROPERTY RS. 50,400/ - AND SHORT - TERM CAPITAL GAINS RS. 5,84,130/ - ). THE CASE OF THE ASSESSEE WAS TAKEN UP FOR SCRUTINY PURSUANT TO SURVEY CONDUCTED U/S. 133A OF THE ACT IN THE CAS E OF M/S. KALYAN CONSTRUCTIONS WHEREIN THE ASSESSEE IS A PARTNER IN THE FIRM. 4. DURING THE COURSE OF SCRUTINY ASSESSMENT PROCEEDINGS, IT WAS OBSERVED BY THE LD. A.O. THAT THE ASSESSEE HAD ACQUIRED FLAT NO. 101 IN KALYANS SREELAKSHMI GOLDEN EDIFICE PROJE CT DEVELOPED BY M/S. KALYAN CONSTRUCTIONS WHEREIN THE ASSESSEE IS ONE OF THE PARTNER. THE AFORESAID PROPERTY WAS ACQUIRED BY THE ASSESSEE VIDE DOCUMENT NO.3117/2012, DATED 28/09/2012 BY WAY OF A GIFT SETTLEMENT DEED TOWARDS WHICH THE ASSESSEES CAPITAL IN THE FIRM WAS REDUCED TO THE EXTENT OF RS. 30, 24,000/ - BEING THE MARKET VALUE OF THE PROPERTY. IT WAS FURTHER OBSERVED THAT ON 08/05/2014, THE ASSESSEE HAD SOLD THE AFORESAID PROPERTY FOR A SALE CONSIDERATION OF RS. 37,00,000/ - VIDE DOCUMENT 3 NO.1489/2014 AND THE ASSESSEE HAD OFFERED SHORT - TERM CAPITAL GAINS OF RS. 5,84,130/ - . 5. IT WAS FURTHER REVEALED THAT DURING THE COURSE OF SURVEY SRI G. RAMESH, MANAGING DIRECTOR OF THE PARTNERSHIP FIRM M/S. KALYAN CONSTRUCTIONS HAS STATED THAT FLAT NO. 101 WAS SOLD FOR RS. 3,500/ - PER SFT TO ONE NRI AMOUNTING TO RS. 56,00,000/ - . THEREAFTER DURING THE COURSE OF HEARING, THE COUNSEL FOR THE A SSESSEE AGREED FOR THE ADDITION. BASED ON THE ADMISSION OF THE LD. AR OF THE ASSESSEE, THE LD. A.O. MADE THE ADDITION OF RS. 19,00,000/ - TOWARDS SHORT - TERM CAPITAL GAINS BY TREATING THE SALE CONSIDERATION AS RS. 56,00,000/ - INSTEAD OF RS. 37,00,000/ - DISC LOSED BY THE ASSESSEE IN HER RETURN OF INCOME. 6. ON APPEAL, THE LD. CIT(A) CONFIRM ED THE ORDER OF THE LD. A.O. BY OBSERVING AS UNDER: - I HAVE CAREFULLY CONSIDERED THE ASSESSMENT ORDER SUBMISSIONS OF THE APPELLANT. AS PER THE SALE AGREEMENT, THE APPELL ANT SOLD ONE FLAT NO.101, ADMEASURING 1600 SFT SITUATED AT SREELAKSHMI GOLDEN EDIFICE FOR A CONSIDERATION OF RS. 56,00,000/ - . AS PER THE SWORN STATEMENT OF SRI G. RAMESH, HUSBAND OF THE APPELLANT, IT IS CONFIRMED THAT THE PROPERTY WAS SOLD FOR RS. 56,00,0 00/ - . THEREFORE, THE SUBMISSIONS OF THE APPELLANT IS NOT ACCEPTED AND I AGREE WITH THE ADDITION MADE BY THE ASSESSING OFFICER. 7. BEFORE US, LD. AR SUBMITTED THAT THE ASSESSEE HAD SOLD THE PROPERTY FOR CONSIDERATION OF RS. 37 LAKHS AS STATED IN THE RE GISTERED DOCUMENT NO.1489/2014 EXECUTED ON 08/05/2014. THE LD. AR FURTHER 4 SUBMITTED THAT MERELY BECAUSE THE COUNSEL OF THE ASSESSEE HAD ADMITTED BEFORE HE LD. A.O. THAT THE SALE VALUE TO BE RS. 56 LAKHS, ADDITION CANNOT BE MADE BECAUSE THERE IS NO DOCUMEN TARY EVIDENCE TO SUBSTANTIATE THE SAME. IT WAS THEREFORE PLEADED THAT THE ADDITION OF RS. 19,00,000/ - MADE BY THE LD. A.O. WHICH WAS FURTHER CONFIRMED BY THE LD. CIT(A) MAY BE DELETED. THE LD. DR ON THE OTHER HAND VEHEMENTLY ARGUED IN SUPPORT OF THE ORDE RS OF THE LD. REVENUE AUTHORITIES. 8. I HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIALS ON RECORD. FROM THE FACTS OF THE CASE, IT IS APPARENT THAT THE SALE VALUE MENTIONED IN THE REGISTERED SALE DEED WAS ONLY RS. 37 LAKHS. THERE WAS NOTHING ON RECORD OTHER THAN THE STATEMENT OF THE MANAGING DIRECTOR MR. G. RAMESH TO ESTABLISH THAT THE ASSESSEE HAD SOLD THE PROPERTY FOR SALE CONSIDERATION OF RS. 56 LAKHS. MERELY ON THE STATEMENT OF MR. G. RAMESH, MANAGING PARTNER OF THE FIRM OR BY THE ADMISSION OF THE ASSESSEES COUNSEL WITHOUT THE KN OWLEDGE AND CONCURRENCE OF THE ASSESSEE, IT CANNOT BE PRESUMED THAT THE SALE CONSIDERATION OF THE PROPERTY SOLD W AS RS. 56 LAKHS. THERE IS NO DOCUMENTARY EVIDENCE OR ANY OTHER COGENT EVIDENCE AVAILABLE ON RECORD TO ESTABLISH THAT THE ASSESSEE HAS SOLD THE PROPERTY FOR RS. 56 LAKHS. FURTHER, THE VALUE RECORDED IN THE SALE D EED AND EXECUTED BEFORE THE REGISTRATION AUTHO RITY STIPULATES THAT THE SALE VALUE OF THE PROPERTY WAS ONLY RS. 37 LAKHS AND THE SAME IS ALSO ACCEPTED BY THE REGISTRATION AUTHORITY . IN THIS 5 SITUATION, I AM OF THE CONSIDERED VIEW THAT THE ADDITION MADE BY THE LD. AO BY ENHANCING THE SALE CONSIDERATION OF THE PROPERTY SOLD IS NOT JUSTIFI ABLE . HENCE, I HEREBY DIRECT THE LD. A.O. TO DELETE ADDITION MADE FOR RS. 19 LAKHS TOWARDS SHORT - TERM CAPITAL GAINS COMPUTED IN THE HANDS OF THE ASSESSEE. 9. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. PRONOUNCED IN THE OPEN COURT ON 2 4 TH SEPTEMBER , 2019. SD/ - ( A. MOHAN ALANKAMONY ) ACCOUNTANT MEMBER HYDERABAD, DATED: 24 TH SEPTEMBER , 2019 OKK COPY TO: - 1) GANDAMALLA RENUKA, D.NO. 2 - 2 - 1076/5/D/1, TILAK NAGAR, HYDERABAD. 2) INCOME TAX OFFICER, WARD - 4(3), HYDERABAD. 3) THE CIT(A) - 1 , HYDERABAD 4) THE PR. CIT - 1 , HYDERABAD 5) THE DR, ITAT, HYDERABAD 6) GUARD FILE