The DCIT, Circle-2, Surat V. Smt. Taraben Jamiyatram, Surat

ITA 2509/AHD/2011

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 89313 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 7 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-05-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Assessment Year: 2007-2008
• Appeal Filed On: 07-10-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SONIA KUMAR
• Assessee Lawyers: SHAH A R
• Keywords: Period of limitation; Cost of acquisition; Valuation report; Time period of passing order; Revised return
• Section: 54

Judgement Text

1 ITA.NO. 2509 /AHD/2011 ASSESSMENT YEAR 2007-2008 IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD D BENCH, AHM EDABAD (BEFORE SHRI N.S.SAINI ACCOUNT ANTMEMBER AND SHRI KUL BHARAT JUDICIAL MEMBER.) ITA NO.2509/AHD/2011 (ASSESSMENT YEAR: 2007 -2008) DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-2, ROOM NO.10, AAYAKAR BHAVAN, MAJURA GATE, SURAT-395 001. ...............AP PELLANT VS. SMT. TARABEN JAMIYATRAM, 3/2212 PIPARDI SHERI, SALABATPURA, MAJURA GATE, SURAT-395001. .................RESPONDEN T (PAN :AKEPG 6159L) APPELLANT BY : SMT. SONIA KUMAR, SR.D.R. RESPONDENT BY: SHRI M.R. SHAH,A.R. DATE OF HEARING : 06-05-2015 DATE OF PRONOUNCEMENT : 08-05-2015 O R D E R PER SHRI N.S. SAINI, ACCOUNTANT MEMBER. THIS APPEAL IS FILED BY THE REVENUE AGAINST THE OR DER OF COMMISSIONER OF INCOME TAX (APPEALS)-II, SURAT DATED 20-07-2011. 2 ITA.NO. 2509 /AHD/2011 ASSESSMENT YEAR 2007-2008 2. THE SOLE GROUND OF APPEAL TAKEN IN THIS APPEAL B Y THE REVENUE IS THAT THE CIT (A) HAS ERRED IN DIRECTING THE ASSESSING OF FICER TO TAKE THE ACQUISITION COST OF THE PROPERTY AS ON 1-4-1981 AT RS.14,32,000 /- AGAINST RS.9 LAKHS SHOWN IN THE RETURN OF INCOME AND AFTER INDEXATION DELETING THE ADDITION OF RS.53,37,461/-. THE ADDITION ON ACCOUNT OF EXTRA CA PITAL GAIN WITHOUT CONSIDERING THE FACT THAT THE ASSESSEE HIMSELF HAS TAKEN THE ACQUISITION COST OF RS.9 LAKH IN HER RETURN OF INCOME. 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE WA S AN OWNER OF A PIECE OF LAND TOGETHER WITH SHRI DEEPAKKUMAR J. GALIAWALA AND SMT. TARABEN JAMIYATRAM WHEREIN THEY ALL HAD 1/3 RD SHARE. THE SAID LAND WAS SOLD DURING THE YEAR UNDER CONSIDERATION AND THE SALE VALUE SHO WN IN THE SALE DEED WAS RS.1,33,67,970/- AND THE VALUE DETERMINED BY THE ST AMP VALUATION AUTHORITY FOR THE SAID LAND WAS RS.2,52,50,610/-. THE ASSESSE E HAD GOT THE VALUE AS ON 1-4-1081 DETERMINED BY THE REGISTERED VALUER AT RS. 1500/- PER SQ.MTR. THE ASSESSEE ADOPTED THE VALUE OF THE LAND AS ON 1-4-19 81 AT RS.1,42,96,000/- WHICH WAS RS.1446/- PER SQ. MTR.AND WAS NEARER TO T HE RATE OF RS.1500/- PER SQ. MTR. ADOPTED BY THE REGISTERED VALUER. THE INDE XED COST OF THIS PROPERTY WAS WORKED OUT TO RS.2,22,96,240/-. THE ASSESSEE HA D TAKEN THE SALE CONSIDERATION AS 1/3 RD OF RS.2,52,50,610/- AND THE INDEXED COST OF ACQUIS ITION AS 1/3 RD OF RS.2,22,96,240/- AND THE SAME WORKED OUT TO RS. 84,16,870/- AND RS.74,32,080/- RESPECTIVELY AND THE ASSESSEE HAD SH OWN THE LONG TERM CAPITAL GAIN AT RS.9,84,790/-. 4. HOWEVER, THE ASSESSING OFFICER THOUGH ADOPTED TH E ASSESSEES SALE CONSIDERATION AT RS.84,16,870/- BUT TOOK THE COST O F ACQUISITION AT RS.27 LAKH AND 1/3 RD THEREOF WHICH WORKED OUT TO RS.9 LAKH AND ON THE I NDEXATION OF THE SAME BY TAKING THE COST INFLATION INDEX AS 519 AND WORKED OUT THE INDEXED COST AT RS.46,71,000/- AND THEREBY DETERMINED THE C APITAL GAIN AT RS.37,45,970/- IN PLACE OF RS.9,84,790/- SHOWN BY THE ASSESSEE. THUS, HE 3 ITA.NO. 2509 /AHD/2011 ASSESSMENT YEAR 2007-2008 MADE ADDITION FOR THE DIFFERENCE AMOUNT OF RS.27,61 ,180/- TO THE INCOME OF THE ASSESSEE. 5. ON APPEAL, THE COMMISSIONER OF INCOME TAX (APPEA LS) DELETED THE ADDITION BY OBSERVING AS UNDER:- 4.2. THE SECOND GROUND OF APPEAL TAKEN BY THE APPE LLANT IS AGAINST THE MERITS OF ADDITION. THE APPELLANT HAS IN THIS R EGARD PLACED RELIANCE ON MY ORDER DATED 27-12-2010 IN THE CASE OF SHRI DE EPAK J. GALIAWALA (APPEAL NO.CAS/II/338/09-10) IN A.Y. 2007-08, AS AL SO VARIOUS SUBMISSIONS MADE DURING THE COURSE OF APPELLATE PRO CEEDINGS IN THE ABOVE CASE. SH. DEEPAK J.GALIAWALA IS ONE OF THE T HREE CO-OWNERS OF THE PROPERTY SOLD DURING THE YEAR, CAPITAL GAIN FRO M WHICH HAS BEEN DECLARED IN THE RETURN OF INCOME. THE THIRD CO-OWNE R BEING SMT. JAMIYATRAM S. GALIAWALA, THE ISSUE INVOLVED IN THE SECOND GROUND OF APPEAL IS, THEREFORE, IDENTICAL TO THE ISSUE INVOLV ED IN THE APPEAL OF SHRI DEEPAK J. GALIAWALA, WHICH HAS BEEN DISPOSED OF BY ME VIDE ORDER DT. 27-10-2010. IN THE SAID ORDER, WITH RESPECT TO REJE CTION BY THE ASSESSING OFFICER OF THE VALUE OF THE PROPERTY TAKE N AS AT 01-04-1981 BY THE AFORESAID ASSESSEE, AS PER THE GOVT. APPROVE D VAUERS REPORT, I HAVE GIVEN MY FINDING, AS UNDER:- UPON VERIFICATION OF THE ORIGINAL SALE DEED DT.27-1 2-1962, IT IS SEEN THAT THE ABOVE PROPERTY AT SURVEY NO.19A-19B W AS PURCHASED BY SHRI NAVINCHANDRA SHIVLAL, PARSURAM SH IVLAL AND SHRI JAMIYATRAM SHIVLAL. THE APPELLANTS SUBMISSION IS THAT THE PROPERTY SOLD DURING THE PREVIOUS YEAR RELEVANT TO ASSTT. YEAR, IS 1/3 RD UNDIVIDED PROPERTY OF SHRIJAMIYATRAM SHIVLAL, SMT. TARABEN SHIVLAL AND SHRI DEEPAKKUMAR JAMIYATRAM. THE APPELL ANT HAS ALSO ENCLOSED A COPY OF HAQNU PATRAK (GAMNO NAMUNO NO.6) AND VALUATION REPORT DT. 17-12-2008 WHICH ALSO SHOW THAT HE ABOVE PERSONS HAD SHARES IN THE PROPERTY SOLD, VIZ. THE OPEN 4 ITA.NO. 2509 /AHD/2011 ASSESSMENT YEAR 2007-2008 PLOT ADMEASURING AT 297066 SQ.MTR.AT DUMAS ROAD, OP P. SVNIT COLLEGE, UMRA, SURAT IN R.S. NO.19A-19B. THE AREA I N 19A IS 2815 SQ.MTR. AND IN 19B IT IS 15566 SQ.MTR. AND THE TOTAL AREA SOLD IS 297066 SQ.MTR. THE VALUATION OF LAND AS ON 01-04-1981 TAKEN BY THE VALUATION OFFICER IS AT THE RATE OF 15 00/- PER SQ.MTR. AND THE TOTAL VALUE OF THE LAND HAS BEEN WORKED OUT AT RS.44,55,990/-, AND THE APPELLANTS SHARE @ 1/3 RD AT RS.14,85,330/-. IN SO FAR AS THE APPELLANTS 1/3 RD SHARE IN THE SALE PROCEEDS IS CONCERNED, THE SAME HAS NOT BEEN DISPUT ED BY THE ASSESSING OFFICER. BUT, WHAT HE HAS DISPUTED IS THA T THE VALUATION AS ON 1-4-1981 TAKEN IN THE ORIGINAL RETURN CANNOT BE CHANGED, ACCORDINGLY INDEXATION OF THE PROPERTY ALSO FOR CAP ITAL GAIN PURPOSE HAS TO BE AS PER THE FIGURES SHOWN IN THE O RIGINAL RETURN. ...UPON DUE CONSIDERATION OF THE APPELLANTS REPLY, I FIND THAT THE REVISED RETURN HAS BEEN FILED WITHIN THE LIMITATION PERIOD AND, THEREFORE, IS A VALID RETURN. THE ASSESSING OFFICER HAS ALSO NOT GIVEN ANY REASON AS TO WHY THE VALUATION ADOPTED AS ON 01-04- 1981 BY THE REGISTERED VALUER IS NOT ACCEPTABLE. I, THEREFORE, DIRECT THE ASSESSING OFFICER TO TAKE THE VALUE OF T HE PROPERTY AS ON 1-4-1981, WHICH OPTION HAS BEEN EXERCISED BY THE APPELLANT, AT THE VALUE TAKEN BY THE REGISTERED VALUER AND TO ALSO TAKE THE INDEXATION OF THE VALUE OF THE PROPERTY AS ON 01-04 -1981, AS DETERMINED IN THE REGISTERED VALUERS REPORT AND TO RE-COMPUTE THE CAPITAL GAINS ON THE PROPERTY AS WELL AS APPELL ANTS SHARE IN THE PROPERTY AS PER THE REGISTERED VALUERS REPORT. 4.3 IN VIEW THAT THE APPELLANT IS 1/3 RD OWNER IN THE ABOVE PROPERTY SOLD DURING THE YEAR FROM WHICH CAPITAL GIVEN HAS B EEN DECLARED, I HOLD THAT THE ABOVE DECISION GIVEN IN THE CASE OF SHRI D EEPAK J. GALIAWALA IS ALSO APPLICABLE IN THE CASE OF THE APPELLANT AND , ACCORDINGLY, DIRECT 5 ITA.NO. 2509 /AHD/2011 ASSESSMENT YEAR 2007-2008 THE ASSESSING OFFICER TO TAKE THE VALUE OF THE PROP ERTY AS PER THE OPTION EXERCISED BY THE APPELLANT, THAT S AS AT 01.04.1981 , AT THE SAME VALUE DETERMINED IN THE REGISTERED VALUERS REPORT FOR TH E PURPOSE OF COMPUTATION OF CAPITAL GAIN. THE SECOND GROUND OF A PPEAL IS, THEREFORE, ALLOWED. 6. BOTH THE PARTIES BEFORE US AGREED WITH THIS FACT OF THE TRIBUNAL IN THE CASE OF SHRI DEEPAKKUMAR J. GALIAWALA IN ITA NO.127 /AHD/2011 & C.O. NO.138/AHD/2011 VIDE ORDER DATED 12-12-2014 PASSED IN A.Y. 2007-08 CONFIRMED THE ORDER OF THE CIT (A) AND DISMISSED TH E APPEAL OF THE ASSESSEE. THEREFORE, THE ISSUE NOW STANDS COVERED IN FAVOUR O F THE ASSESSEE AND AGAINST THE REVENUE BY THE SAID ORDER OF THE TRIBUN AL. WE FIND THAT THE TRIBUNAL IN THE CASE OF SHRI DEEPAKKUMAR J. GALIAWA LA (SUPRA) HELD AS UNDER:- 4.1. WE HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATERIAL AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. WE FIND THAT THE LD. CIT(A) HAS GIVEN A DIRE CTION IN PARA-3.2 OF HIS ORDER AS UNDER:- 3.2. UPON DUE CONSIDERATION OF THE APPELLANTS REP LY, I FIND THAT THE REVISED RETURN HAS BEEN FILED WITHIN THE LIMITA TION PERIOD AND, THEREFORE, IS A VALID RETURN. THE ASSESSING OFFICER HAS ALSO NOT GIVEN ANY REASON AS TO WHY THE VALUATION ADOPTED AS ON 01-04- 1981 BY THE REGISTERED VALUER IS NOT ACCEPTABLE. I, THEREFORE, DIRECT THE ASSESSING OFFICER TO TAKE THE VALUE OF T HE PROPERTY AS ON 1-4-1981, WHICH OPTION HAS BEEN EXERCISED BY THE APPELLANT, AT THE VALUE TAKEN BY THE REGISTERED VALUER AND TO ALSO TAKE THE INDEXATION OF THE VALUE OF THE PROPERTY AS ON 1-4-1 981, AS DETERMINED IN THE REGISTERED VALUERS REPORT AND TO RE-COMPUTE THE CAPITAL GAINS ON THE PROPERTY AS WELL AS APPELL ANTS SHARE IN THE PROPERTY AS PER THE REGISTERED VALUERS REPORT. PART (A) & (B) 6 ITA.NO. 2509 /AHD/2011 ASSESSMENT YEAR 2007-2008 OF THE SECOND GROUND OF APPEAL IS, THEREFORE, ALLOW ED AS PER THE ABOVE DIRECTIONS. PART (C) OF THE SECOND GROUND OF APPEAL IS AGAINST REJECTION OF CLAIM U/S. 54 OF THE ACT. THE APPELLANT, IN THIS REGARD HAS RELIED UPON THE DECISION IN THE CASE OF CELLO PLASTS VS. DCIT MUMBAI ITAT (2010 ITOL 60) AND HAS STATED THAT SINCE HE SCHEME OF REC BONDS CAME INTO EXISTENCE FOR THE FIRST TIME ON 22.01.2007, HE COULD NOT HAVE INVESTED IN THE SA ID SCHEME BEFORE THE SCHEME CAME INTO EXISTENCE, HENCE HE IS ELIGIBLE FOR DEDUCTION U/S. 54 OF THE ACT. I HAVE DULY CONSIDERE D THE SUBMISSION OF THE APPELLANT. HOWEVER, I FIND THAT T HERE IS NO DISPUTE THAT THE PERIOD OF 6 MONTHS FOR THE INVESTM ENT OF THE CAPITAL GAIN FROM THE IMMOVABLE PROPERTY EXPIRED ON 23.12.2006, AND TILL THEN THE ABOVE BONDS HAD NOT BEEN ISSUED. THEREFORE, THE APPELLANT KNOWINGLY DEFERRED THE INVESTMENT OF CAPITAL GAIN AFTER THE EXPIRY OF THE ABOVE PERIOD AND THERE IS N O QUESTION OF GETTING ANY BENEFIT UNDER EXEMPTION OF THE ABOVE SE CTION. I, THEREFORE, UPHOLD THE ASSESSMENT ORDER ON THIS POIN T AND DISMISS THIS PART OF GROUND OF APPEAL. THE GROUND OF APPEAL NO.2 IS, THEREFORE, PARTLY ALLOWED. 4.2. WE DO NOT FIND ANY INFIRMITY IN THE FINDING OF THE LD. CIT (A) AS THE A.O. HAS NOT GIVEN ANY VALID REASON NOT TO ADOP T THE VALUATION GIVEN BY THE GOVERNMENT APPROVED VALUER. THEREFORE, GROUNDS RAISED IN THE APPEAL BY THE REVENUE ARE DEVOID OF ANY MERI T, SAME ARE REJECTED. 7. IN VIEW OF THE ABOVE FACTS AND CIRCUMSTANCES OF THE CASE WE DISMISS THE GROUND OF APPEAL OF THE REVENUE. 7 ITA.NO. 2509 /AHD/2011 ASSESSMENT YEAR 2007-2008 8. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED.. ORDER PRONOUNCED ON 08 -05 -2015. SD/- SD/- (KUL BHARAT) (N. S. SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD, THE 8TH DAY OF MAY, 2015 COPIES TO: (1) THE APPELLANT (2) THE RESPON DENT (3) COMMISSIONER (4) CIT(A) (5) DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER ETC ASSISTANT/DEPUTY REGISTRAR INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCHES, AHMEDABAD PATKI 1. DATE OF DICTATION . 7-5-2015. (DICTATION-PAD PAG ES ATTACHED AT THE END OF THIS FILE) 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER ..7-5-2015 3. OTHER MEMBER 7-5-2015 4. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P .S./P.S 7-5-2015 5. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT 7-5-2015 6. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. P.S./P.S 8-5-2015 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 8-5- 2015 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK ... 9. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER.. 10 DATE OF DESPATCH OF THE ORDER