Shri Chandulal Parbatbhai Patel, Ahmedabad V. The Dy. Commissioner of Income Tax, Central Circle-5(3), Ahmedabad

ITA 2444/AHD/2016

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 5261 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-10-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2012-2013
• Appeal Filed On: 28-09-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: LALIT P JAIN
• Assessee Lawyers: M J SHAH
• Keywords: Sale consideration of property below Jantri Value; Fair market value
• Section: 50C; 147; 148

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL, C BENCH, AHMEDABAD BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI AMARJIT SINGH, ACCOUNTANT MEMBER ITA NO.2444/AHD/2016 / ASSTT. YEAR: 2012-2013 SHRI CHANDULAL PARBATBHAI PATEL PROP. M/S.SHREE SHARDA TIMBER MART LATI BAZAR ZONE-2 GITA MANDIR AHMEDABAD. PAN : AAWPP 0054 D VS. DCIT, CENT.CIR.5(3) AHMEDABAD. ( APPLICANT ) ( RESPONENT ) ASSESSEE BY : SHRI M.J. SHAH REVENUE BY : SHRI LALIT P.JAIN, SR.DR / DATE OF HEARING : 18/10/2018 / DATE OF PRONOUNCEMENT: 23/10/2018 +,/ O R D E R PER RAJPAL YADAV, JUDICIAL MEMBER: PRESENT APPEAL IS DIRECTED AT THE INSTANCE OF THE A SSESSEE AGAINST ORDER OF THE LD.CIT(A)-5, AHMEDABAD DATED 1.9.2016 PASSED FOR THE ASSTT.YEAR 2012-13. 2. SOLE GRIEVANCE OF THE ASSESSEE IN THIS APPEAL IS AGAINST ACTION OF THE AO IN SUBSTITUTING VALUE OF THE PROPERTY DETERMINED BY THE STAMP VALUATION AUTHORITY AS DEEMED VALUE OF SALE CONSIDERATION REC EIVED ON SALE IMMOVABLE PROPERTY QUA LAND SITUATED AT 1089/90. ITA NO.2444/AHD/2016 2 3. BRIEF FACTS RELEVANT FOR ADJUDICATION IS THAT TH E ASSESSEE HAS E-FILED HIS ORIGINAL RETURN OF INCOME ON 26.7.2012 DECLARING TO TAL INCOME AT RS.11,42,526/-. THEREAFTER ON RECEIPT OF INFORMATI ON RECEIVED PERTAINED TO THE SALE OF CERTAIN IMMOVABLE PROPERTIES UNDER SECTION 50C OF THE ACT, THE CASE OF THE ASSESSEE WAS REOPENED UNDER SECTION 147 AND ISS UED AND SERVED NOTICE UNDER SECTION 148 OF THE ACT UPON THE ASSESSEE. ACC ORDINGLY, ASSESSEE REVISED ITS RETURN DECLARING A REVISED INCOME AT RS.34,86,5 04/- AND PAID ADDITIONAL TAX THERETO. IT IS NOTICED BY THE AO THAT ASSESSEE ALO NG WITH OTHER CO-OWNERS SOLD LAND SITUATED AT VILLAGE GODHAVI FOR A CONSIDERATIO N OF RS.1,70,54,300/-. A NOTICE WAS ISSUED TO THE ASSESSEE TO FURNISH DETAIL S OF TRANSACTION WITH RESPECT TO THE IMMOVABLE PROPERTIES ENTERED INTO BY THE ASS ESSEE DURING THE UNDER CONSIDERATION AND TO WORK OUT CAPITAL GAIN THEREON. DISPUTE IN THIS PRESENT CASE RELATES TO SALE OF LAND AT SURVEY NO.1089/20 S OLD ON 29.7.2011 IN WHICH THE ASSESSEE HAS 25% SHARE AS CO-OWNER. ASSESSEE SUBMITTED THAT HE HAS ALREADY OFFERED SHORT TERM CAPITAL GAIN AND PAID AD DITIONAL TAX THEREON, WHICH WAS CALCULATED ON THE BASIS OF VALUE ESTIMATED BY T HE DEPARTMENTAL VALUATION OFFICER IN THE CASE OF CO-OWNER WHO WAS ALSO CO-OWN ER OF THE SAME PIECE OF LAND. HOWEVER, THE LD.AO DID NOT ACCEPT THIS SUBMI SSION OF THE ASSESSEE ON THE GROUND THAT VALUE DETERMINED BY THE STAMP VALUA TION AUTHORITY IS MORE RELIABLE AND BINDING THAN THE VALUE DETERMINED BY T HE DVO. HE ACCORDINGLY MADE ADDITION OF RS.55,56,456/-. THIS ADDITION WAS CHALLENGED BEFORE THE LD.FIRST APPELLATE AUTHORITY. THOUGH, THE LD.CIT(A ) IN PRINCIPLE AGREED THAT SINCE THE PROPERTY IN QUESTION WAS ALREADY REFERRED AND VALUED BY THE DVO, THE RIGHT COURSE FOR THE AO WAS TO ADOPT VALUE ADOP TED BY THE DVO, BUT CONFIRMED THE ADDITION ON DIFFERENT FOOTING. ASSES SEE IS NOW BEFORE THE TRIBUNAL. 4. BEFORE US, THE LD.COUNSEL FOR THE ASSESSEE REITE RATED SUBMISSIONS MADE BY THE REVENUE AUTHORITIES BELOW, AND FURTHER SUBMI TTED THAT AS PER THE ITA NO.2444/AHD/2016 3 MANDATE PROVIDED UNDER SECTION 50C, WHERE THE ASSES SEE DISPUTES VALUE ADOPTED OR ASSESSED BY THE AO, THEN THE AO MUST REF ER VALUATION OF THE PROPERTY TO THE VALUATION OFFICER IN ACCORDANCE WIT H THE PROVISIONS OF SECTION 55A OF THE ACT. IN THE PRESENT CASE, THE SAME OF P IECE OF LAND HAS ALREADY VALUED BY THE DVO IN THE CASE OF OTHER CO-OWNER BY A REFERENCE BY THE AO AND THE AO HAS ACCEPTED THE SAME, AND THEREFORE, TH E AO CANNOT APPLY DIFFERENT VALUES FOR SAME PIECE OF LAND. THE ASSES SEE HAS ALREADY OBJECTED TO SUCH VALUATION BEFORE THE BOTH REVENUE AUTHORITIES AND MADE A SPECIFIC REQUEST THAT VALUE ADOPTED IN THE CASE OF CO-OWNER BE ADOPTED IN THE CASE OF THE ASSESSEE AS WELL. ON THE OTHER HAND, THE LD.DR SUPPORTED THE ORDERS OF THE REVENUE AUTHORITIES. 5. WITH THE ASSISTANCE OF LD.REPRSENTATIVES, WE HAV E GONE THROUGH THE RECORD CAREFULLY. THE GRIEVANCE OF THE ASSESSEE IS THAT THE LD.AO HAS ERRED IN ADOPTING VALUE OF THE LAND TRANSFERRED BY THE ASSES SEE EQUIVALENT TO THE VALUE ON WHICH STAMP DUTY WAS PAID. IT EMERGES OUT FROM THE RECORD THAT THE ASSESSEE WAS HAVING 25% SHARE IN THE LAND BEARING S URVEY NO.1089/90. HE HAS SOLD THIS LAND WITH OTHER CO-OWNERS. THE LD.AO WHILE COMPUTING THE CAPITAL GAIN UNDER SECTION 48 OF THE ACT ADOPTED FU LL VALUE OF THE SALE CONSIDERATION EQUIVALENT TO THE AMOUNT ON WHICH STA MP DUTY WAS PAID. THE CASE OF THE ASSESSEE WAS THAT IN THE CASE OF CO-OWN ER, REFERENCE WAS GIVEN TO DVO UNDER SECTION 50C(2) WHO HAD DETERMINED FAIR MA RKET VALUE OF THE PROPERTY. THE LD.COUNSEL FOR THE ASSESSEE CONTENDE D THAT THE ASSESSEE MADE A PRAYER BEFORE THE LD.CIT(A) THAT THE SAME VALUE BE ADOPTED IN THE CASE OF THE ASSESSEE. WE FIND FORCE IN THIS CONTENTION OF THE A SSESSEE, BECAUSE SECTION (2) OF SECTION 50C CONTEMPLATES THAT IN CASE ASSESSEE R AISES AN OBJECTION OF THE VALUE ON WHICH STAMP DUTY WAS PAID, THEN IN ORDER T O FIND FAIR MARKET VALUE OF THE ASSET, REFERENCE WOULD BE MADE TO THE DVO , SIN CE IN THE CASE OF CO-OWNER SUCH REFERENCE WAS MADE ON THE SAME PIECE OF LAND. THE SAME VALUE ITA NO.2444/AHD/2016 4 DETERMINED BY THE AO IN THE CASE OF CO-OWNER OUGHT TO BE ADOPTED IN THE CASE OF THE ASSESSEE. WE ALLOW THE APPEAL OF THE ASSESS EE AND REMIT THE ISSUE TO THE FILE OF THE AO WITH DIRECTION TO THE LD.AO TO COMPU TE THE CAPITAL GAIN ASSESSABLE IN THE HANDS OF THE ASSESSEE ON TRANSFER OF THE ABOVE LAND BY ADOPTING FULL SALE CONSIDERATION EQUIVALENT TO THE AMOUNT DETERMINED BY THE DVO IN THE CASE OF CO-OWNER. WITH THIS DIRECTION, WE ALLOW THIS GROUND OF APPEAL. 6. IN THE RESULT APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE COURT ON 23 RD OCTOBER, 2018 AT AHMEDABAD. S D / - (AMARJIT SINGH) ACCOUNTANT MEMBER S D / - (RAJPAL YADAV) JUDICIAL MEMBER