VEENA SURESH PHADKE, MUMBAI V. DCIT 32(3)(5), MUMBAI

ITA 235/MUM/2017

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 0267 (ITAT-MUMBAI)
• Duration Of Justice: 5 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-06-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 11-01-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: T A KHAN

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES SMC, MUMBAI BEFORE SHRI B R BASKARAN, ACCOUNTANT MEMBER ITA NO.235/MUM/2017 ASSESSMENT YEAR : 2011-12 SMT VEENA SURESH PHADKE, 601, KAUSTUBH, 7 BUNGLOW COLONY NR. SAILEE INTERNATIONAL SCHOOL GORAI ROAD, BORIVALI (W) MUMBAI 400 091 PAN BBDPP2399L VS . DCIT 32(3)(5) MUMBAI (APPELLANT) RESPONDENT) APPELLANT BY : SHRI RAJESH KOTHARI RESPONDENT BY : SHRI T A KHAN DATE OF HEARING : 22 .0 6 .201 7 DATE OF PRONOUNCEMENT : 22 .0 6 . 201 7 O R D E R THE APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER DATED 23.11.2016, PASSED BY THE LEARNED CIT(A)-44, MUMBAI , AND IT RELATES TO ASSESSMENT YEAR 2011-12. THOUGH THE ASSESSEE HAS RAISED AS MA NY AS SIX GROUNDS, I NOTICED THAT THE ASSESSEE HAS CONTESTED THE FOLLOWING TWO I SSUES ONLY BEFORE THE CIT(A): A) INDEXATION BENEFITS AVAILABLE TO THE ASSESSEE B) OMISSION TO CONSIDER ADDITIONS MADE TO THE PROPERTY . HENCE, I PROCEED TO DISPOSE OF THE ABOVE TWO GROUND S ONLY. ACCORDINGLY, THE REMAINING GROUNDS ARE DISMISSED, AS NOT ARISING OUT OF THE ORDER PASSED BY THE LEARNED CIT(A). ITA NO.235/MUM/2017 VEENA SURESH PHADKE 2 2. I HEARD THE PARTIES AND PERUSED THE RECORD. THE ASSESSEE, ALONG WITH OTHER CO-OWNERS, SOLD AN IMMOVABLE PROPERTY DURING THE YE AR UNDER CONSIDERATION. THE ASSESSEE COMPUTED LONG TERM CAPITAL GAIN OF ` 31.48 LACS AND CLAIMED THE SAME AS EXEMPT. THE ASSESSEE HAD OBTAINED THE PROPER IN SU CCEESION ON 06.06.2001. THE ORIGINAL OWNER OF THE PROPERTY HAD PURCHASED IT BEF ORE 01.04.1981 I.E. ON 04.11.1970. THE ASSESSEE CLAIMED INDEXATION BENEFI T FROM 01.04.1981. HOWEVER, THE ASSESSING OFFICER ALLOWED INDEXATION BENEFITS O NLY FROM THE F.Y 2001-02, SINCE THE ASSESSEE BECAME OWNER OF THE PROPERTY ONLY ON 0 6.06.2001, ON SUCCESSION. THE LEARNED CIT(A) CONFIRMED THE SAME AND, HENCE, T HE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. 3. AT THE TIME OF HEARING, THE LEARNED AR SUBMITTED THAT THIS ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE VIDE THE DECISION RENDERED B Y THE HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT VS. MANJULA J SHAH (2012) 249 CTR (BOM) 270, WHEREIN, THE HONBLE BOMBAY HIGH COURT HAS HELD THAT IF INDEXATION IS LINKED TO THE PERIOD OF HOLDING THE ASSET AND IN THE CASE OF AN ASSESSEE CO VERED UNDER SECTION 49(1), THE PERIOD OF HOLDING THE ASSET HAS TO BE DETERMINED BY INCLUDING THE PERIOD FOR WHICH THE SAID ASSET WAS HELD BY THE PREVIOUS OWNER, THEN OBVIOUSLY IN ARRIVING AT THE INDEXATION, THE FIRST YEAR IN WHICH THE SAID ASSET WAS HELD BY THE PREVIOUS OWNER WOULD BE THE FIRST YEAR FOR WHICH THE SAID ASSET WA S HELD BY THE ASSESSEE . ACCORDINGLY, THE HONBLE BOMBAY HIGH COURT HELD THA T INDEXATION BENEFIT SHALL BE AVAILABLE FROM THE YEAR IN WHICH THE ASSET WAS HELD BY THE PREVIOUS OWNER. THE LEARNED AR SUBMITTED THAT SINCE THE PREVIOUS OWNER HAD HELD THE ASSET PRIOR TO 01.04.1981, THE INDEXATION BENEFIT SHALL BE AVAILAB LE TO THE ASSESSEE FROM 01.04.1981. ITA NO.235/MUM/2017 VEENA SURESH PHADKE 3 4. I HEARD THE REPRESENTATIVES AND PERUSED THE RECO RD. THE CLAIM OF THE ASSESSEE IS ALLOWABLE AS PER THE DECISION RENDERED BY THE HONBLE JURISDICTIONAL HIGH COURT, REFERRED ABOVE. ACCORDINGLY, I SET ASIDE TH E ORDER PASSED BY THE LEARNED CIT(A) ON THIS ISSUE AND DIRECT THE ASSESSING OFFIC ER TO ALLOW INDEXATION BENEFIT FROM 01.04.1981. 5. THE NEXT ISSUE RELATES TO CONSIDERATION OF IMPRO VEMENT MADE TO THE PROPERTY IN 1987. IT IS THE CASE OF THE ASSESSEE THAT THE F IRST FLOOR WAS CONSTRUCTED UPON THE PROPERTY IN 1987 AND THE COST CONSTRUCTION OF THE F IRST FLOOR HAS TO BE CONSIDERED FOR THE PURPOSE OF ARRIVING AT THE COST OF ASSET. I NO TICED THAT THE LEARNED CIT(A) HAS FAILED TO ADJUDICATE THIS ISSUE, EVEN THOUGH THE SA ME WAS URGED BEFORE HIM. HENCE, I THINK IT FIT TO RESTORE THIS ISSUE TO THE FILE OF THE LEARNED CIT(A) FOR ADJUDICATING THE SAME. ACCORDINGLY, THE FILE IS RESTORED TO THE FIL E OF THE CIT(A). 6. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT ON THIS DAY OF 22 ND JUNE 2017 SD/- (B R BASKARAN) ACCOUNTANT MEMBER MUMBAI, DATED : 22 ND JUNE, 2017. SA ITA NO.235/MUM/2017 VEENA SURESH PHADKE 4 COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE C I T(A), MUMBAI. 4. THE C I T 5. THE DR, SMC BENCH, ITAT, MUMBAI BY ORDER //TRUE COPY// (ASSISTANT REGISTRAR) INCOME TAX APPELLATE TRIBUNAL, MUMBAI