The ITO, (Exemptions), Ward, Vadodara V. Matrushri Gangaba Trust, Vadodara

ITA 259/AHD/2017

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 2728 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 8 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-10-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: 2007-2008
• Appeal Filed On: 01-02-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: LALIT P JAIN
• Assessee Lawyers: S N DIVATIA
• Keywords: Sale consideration of property below Jantri Value
• Section: 143(3); 50C; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD D BENCH (BEFORE SHRI PRAMOD KUMAR, ACCOUNTANT MEMBER & SHRI MAHAVIR PRASAD, JUDICIAL MEMBER) ITA. NO: 259/AHD/2017 (ASSESSMENT YEAR: 2007-08) INCOME TAX OFFICER (EXEMPTION), WARD, VADODARA V/S MATRUSHRI GANGABA TRUST, KAMDHENU ESTATE OPP. CITY BAN, RACE COURSE- GOTRI ROAD, VADODARA- 390005 (APPELLANT) (RESPONDENT) PAN: AAATM3712B APPELLANT BY : SHRI LALIT P JAIN, SR. D. R. RESPONDENT BY : SHRI S. N. DIVATIA, A.R. ( )/ ORDER DATE OF HEARING : 02 -08-201 8 DATE OF PRONOUNCEMENT : 30 -10-2018 PER MAHAVIR PRASAD, JUDICIAL MEMBER 1. THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF THE LD. CIT(A)-2, VADODARA DATED 09.11.2016 PERTAINING TO A.Y. 2007-0 8 AND THAT WHETHER ON FACTS AND IN THE CIRCUMSTANCES OF THE CASE THAT LD. CIT(A) JUSTIFIED IN DELETING ITA NO. 259/ AHD/2017 . A.Y. 2007-0 8 2 THE LTCG OF RS. 1,83,76,000/- HOLDING THAT IT HAS B EEN WRONGLY ASSESSED IN THE HANDS OF THE ASSESSEE. 2. IN THIS CASE, ASSESSEE FILED ITS RETURN OF INCOME O N 28.07.2007 DECLARING TOTAL INCOME AT RS. 6,79,020/-. THEREAFTER NOTICE U/S. 14 8 WAS ISSUED ON 19.03.2014 IN RESPONSE TO WHICH ASSESSEE SUBMITTED RETURN OF I NCOME. ALTHOUGH THE ASSESSEE IS A TRUST BUT IT IS NOT REGISTERED U/S. 1 2A. AFTER CONSIDERING THE SUBMISSION OF THE ASSESSEE, THE ASSESSING OFFICER A SSESSED LONG TERM CAPITAL GAINS FROM THE SALE OF IMMOVABLE PROPERTY AT RS. 1, 83,76,000/- U/S. 50C AND THIS ISSUE HAS BEEN DISCUSSED BY THE ASSESSING OFFI CER IN PARA-4 OF THE ASSESSMENT ORDER. 3. THEREAFTER ASSESSEE PREFERRED FIRST STATUTORY APPEA L BEFORE THE LD. CIT(A) WHO PARTLY ALLOWED THE APPEAL OF THE ASSESSEE. 4. NOW DEPARTMENT IS BEFORE US. 5. IN THIS CASE, ASSESSEE IS A PRIVATE TRUST AND DERIV ES INCOME FROM INTEREST. AS PER THE AIR INFORMATION, IT HAS COME TO THE KNOWLEDGE O F THE ASSESSING OFFICER THAT A SALE DEED HAS BEEN EFFECTED IN RESPECT OF IM MOVABLE PROPERTY AND THE DECLARED CONSIDERATION WAS RS. 2.00 CRORES. THE SAL E IS EXECUTED IN FAVOUR OF TANMAN FIVNEST PVT. LTD. BY THE ASSESSEE ALONG WITH ANOTHER CO-OWNER SMT. GANGABEN RAOJIBHAI PATEL WITH M/S. JOHNSON ELECTRIC CO. PVT. LTD. AS A CONFIRMING PARTY. THEREAFTER ASSESSING OFFICER COMP UTED THE INCOME FROM THE SALE OF LAND UNDER THE HEAD CAPITAL GAIN AND DETERM INED THE TOTAL INCOME AT RS. 2,23,76,000/- AND REDUCE AN AMOUNT OF RS. 40,00,000 /- FROM SUCH AMOUNT CONSIDERING SUCH AMOUNT HAVING BEEN OFFERED AS VALU E OF CONSIDERATION IN THE ITA NO. 259/ AHD/2017 . A.Y. 2007-0 8 3 A.Y. 2007-08. THE WORD OR ASSESSABLE INSERTED IN SECTION 50C BY FINANCE ACT, 2009 WITH EFFECT FROM 01/04/2009 IS APPLICABLE FROM 2009-10 ONLY AND HENCE PROVISIONS OF SECTION 50C CANNOT BE APPLIED I N THE YEAR UNDER CONSIDERATION. THEREFORE, CAPITAL GAIN CANNOT BE AS SESSED U/. 50C IN THE CASE OF ASSESSEE. 6. NOW PROPERTY UNDER CONSIDERATION STOOD TRANSFERRED ON 15/07/2006 ON HANDING OVER OF THE POSSESSION TO JHONSON ELECTRIC CO. PVT. LTD. IN COMPLIANCE TO AGREEMENT FOR SALE DATED 06.04.1993. ACCORDINGLY , SUBSEQUENT TRANSFER OF THE SAID PROPERTY BY JHONSON ELECTRIC CO. PVT. LTD. TO TANMAN FINVEST PVT. LTD. VIDE DEED OF CONVEYANCE DATED 08.05.2007 WOULD RESULT CAPITAL GAIN IN THE HANDS OF JHONSON ELECTRIC CO. PVT. LTD. ONLY. IT IS WORTHWHILE TO MENTION HERE THAT THE LONG TERM CAPITAL GAIN ON THE BASIS OF DEE D OF CONVEYANCE DATED 08.05.2007 HAS BEEN ASSESSED IN THE CASE OF JHONSON ELECTRIC CO. PVT. LTD. VIDE AN ORDER U/S. 143(3) R.W.S. 147 DATED 03.11.2010. SINCE LONG TERM CAPITAL GAINS ON THE BASIS OF SALE CONSIDERATION DISCLOSED IN CONVEYANCE DEED DETERMINED U/S. 50C HAS ALREADY BEEN ASSESSED IN T HE CASE OF JHONSON ELECTRIC CO. PVT. LTD. WHICH HAD PURCHASED THE PROPERTY FROM THE ASSESSEE. THEREFORE, LD. CIT(A) HAS RIGHTLY HOLD THAT PROPERTY CANNOT AG AIN BE ASSESSED IN THE HANDS OF ASSESSEE. IN OUR CONSIDERED OPINION, LD. CIT(A) HAS PASSED DETAILED AND REASONED ORDER AND SAME DOES NOT REQUIRE ANY KIND O F INTERFERENCE AT OUT END. 7. IN THE RESULT, APPEAL FILED BY THE REVENUE IS DISMI SSED. ORDER PRONOUNCED IN OPEN COURT ON 30 - 10- 2018 SD/- SD/- (PRAMOD KUMAR) (MAHAVIR PRASAD) ACCOUNTANT MEMBER TRUE COPY JUDICIAL MEMBER AHMEDABAD: DATED 30/10/2018