VISHAL VARMA, MUMBAI V. I.T.O. 20(3)(4), MUMBAI

ITA 2610/MUM/2012

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 3748 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-05-2013
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: F
• Assessment Year: 2008-2009
• Appeal Filed On: 18-04-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RAJARSHI DWIVEDY DT OF HEARING
• Assessee Lawyers: R M JAIN
• Keywords: Sale consideration of property below Jantri Value; Capital asset; Fair market value; Valuation report
• Section: 50C

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL F BENCH, MUMBAI , ! !! ! . ' ' ' ' , #$ #$ #$ #$ BEFORE SHRI VIJAY PAL RAO, JM & SHRI D KARUNAKARA R AO, AM ./ I.T.A. NO.2610/MUM/2012 ( % % % % & & & & / ASSESSMENT YEAR : 2008-09) VISHAL VARMA UNIT NO. 13 STELLER TOWER CROSS ROAD NO.2 LOKHANDWALA COMPOUND ANDHERI (W) MUMBAI 53 % % % % / VS. THE INCOME TAX OFFICER WARD 20(3)(4), MUMBAI ' #$ ./ ( ./ PAN/GIR NO. : AAAPV3194J ( ') / APPELLANT ) .. ( *+') / RESPONDENT ) ') ') ') ') , , , , # ## # / APPELLANT BY : SHRI R M JAIN *+') *+') *+') *+') - -- - , , , , # ## # /RESPONDENT BY : SHRI RAJARSHI DWIVEDY % % % % - -- - .$ .$ .$ .$ / DT. OF HEARING : 3 RD MAY 2013 /0& /0& /0& /0& - -- -.$ .$ .$ .$ / DT.OFPRONOUNCEMENT: 8 TH MAY 2013 #1 / O R D E R PER : , . . / VIJAY PAL RAO, JM THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER DATED 14.3.2012 OF THE COMMISSIONER OF INCOME TAX (APPEAL S) FOR THE ASSESSMENT YEAR 2008-09. 2 THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS IN THIS APPEAL: I) ON THE FACTS AND THE CIRCUMSTANCES OF THE CASE T HE COMMISSIONER OF INCOME TAX(APPEALS) ERRED IN CONFIRMING THE ORD ER OF THE ASSESSING OFFICER WITHOUT CONSIDERING THE SUBMISSIO N. II) ON THE FACT AND THE CIRCUMSNACES OF THE CASE TH E COMMISSIONER OF INCOME TAX(APPEALS) HAS ERRED IN NOT CONSIDERING THE JUDGMENT OF THE BOMBAY HIGH COURT AND THE TRIBUNAL. ITA NO. .2610/M/2012 . 2 III) THE APPELLANT THEREFORE PRAYS THAT ADDITION MA DE MAY PLEASE BE DELETED/AND OR MATTER MAY PLEASE BE REFERRED TO DVO FOR VALUATION OF THE PROPERTY. 3 THE ONLY GRIEVANCE OF THE ASSESSEE IN THIS APPEAL IS AGAINST THE ADOPTION OF THE FAIR MARKET VALUE OF THE PROPERTY A S VALUED BY THE STAMP VALUATION AUTHORITY AS PER SEC. 50C WITHOUT REFERRI NG THE MATTER TO THE DEPARTMENTAL VALUER DVO - FOR VALUATION OF THE PR OPERTY. 3.1 THE ASSESSEE PURCHASED THE PROPERTY BEING PLOT OF LAND NO. 24 (NORTH) CTS NO.F/2540, REVENUE VILLAGE, BANDRA ALON G WITH BUILDING/STRUCTURES THEREON ON 15.1.2002 FOR A CONS IDERATION OF ` 2 LACS. THE ASSESSEE SOLD THE SAID PROPERTY ON 27.11.2007 F OR A CONSIDERATION OF ` 20 LACS. ON VERIFICATION OF THE DETAILS, THE AS SESSING OFFICER NOTICED THAT THE SALE CONSIDERATION WAS TAKEN AT ` 72,04,288/- B Y THE STAMP VALUATION AUTHORITY; THEREFORE, THE ASSESSING OFFICER ADOPTED THE FULL SALE CONSIDERATION OF THE PROPERTY AS PER PROVISIONS OF SEC. 50C AT ` 72,04,288/- BEING THE VALUE CONSIDERED BY THE STA MP VALUATION AUTHORITY FOR THE PURPOSE OF STAMP DUTY. THOUGH, THE ASSESSE E FILED A VALUATION REPORT OF THE REGISTERED VALUER IN WHICH THE VALUE OF THE PROPERTY HAS BEEN ASSESSED AT ` 23,49,300/-; HOWEVER, THE ASSESS ING OFFICER ADOPTED THE VALUE AS DETERMINED BY THE STAMP VALUATION AUTH ORITY FOR THE PURPOSE OF COMPUTATION OF CAPITAL GAINS. 3.2 THE ASSESSEE CHALLENGED THE ACTION OF THE ASSES SING OFFICER BEFORE THE COMMISSIONER OF INCOME TAX(APPEALS) BUT COULD N OT SUCCEED. ITA NO. .2610/M/2012 . 3 4 WE HAVE HEARD THE LD AR AS WELL AS THE LD DR AND CONSIDERED THE RELEVANT MATERIAL ON RECORD. THE LD COUNSEL FOR TH E ASSESSEE HAS SUBMITTED THAT THE ASSESSEE OBJECTED TO THE ADOPTIO N OF THE VALUE AT ` 72,04,288/- BEING THE VALUE DETERMINED BY THE STA MP VALUATION AUTHORITY. HE HAS REFERRED THE LETTER DATED 8.12.2 010 AND SUBMITTED THAT WITHOUT CONSIDERATION THE OBJECTIONS OF THE ASSESSE E AND WITHOUT REFERRING THE VALUATION OF THE PROPERTY TO THE DISTRICT VALUA TION OFFICER (DVO), THE ASSESSING OFFICER ADOPTED THE VALUE U/S 50C, WHICH IS NOT JUSTIFIED. HE HAS FURTHER CONTENDED THAT THE ASSESSEE HAS POINTE D OUT IN THE SAID LETTER DATED 8.12.2010 THE VARIOUS INFIRMITY AND DEFECTS IN THE PROPERTY IN QUESTION AND THEREFORE, IN VIEW OF THE OBJECTION AS WELL AS THE VALUATION REPORT FILED BY THE ASSESSEE OF A REGISTERED VALUER , THE MATTER SHOULD HAVE BEEN REFERRED TO THE DVO. 4.1 ON A QUERY FROM THE BENCH, THE LD COUNSEL HAS S UBMITTED THAT THOUGH THE ASSESSMENT ORDER BEARS THE DATE 30.11.2 010; HOWEVER, THE SAID LETTER DATED 8.12.2010 WAS FILED BY THE ASSES SEE BEFORE THE RECEIPT OF THE ASSESSMENT ORDER. HE HAS FURTHER CONTENDED T HAT THE ASSESSEE RAISED THE SPECIFIC ISSUE OF INVOKING THE PROVISION S OF SEC. 50C BEFORE THE COMMISSIONER OF INCOME TAX(APPEALS); BUT THE SAME W AS REJECTED BY THE COMMISSIONER OF INCOME TAX(APPEALS). 4.2 ON THE OTHER HAND, THE LD DR HAS RELIED UPON TH E ORDERS OF AUTHORITIES BELOW AND THE SUBMITTED THAT THE ASSES SING OFFICER HAS ALSO NOTED THAT APART FROM THE TRANSFER OF PROPERTY IN Q UESTION, THE ASSESSEE ITA NO. .2610/M/2012 . 4 HAS ALSO SURRENDERED THE TENANCY RIGHTS AGAINST WHI CH THE ASSESSEE HAS NOT DISCLOSED ANY CONSIDERATION. 5 WE HAVE HEARD THE LD AR AS WELL AS THE LD DR AND CONSIDERED THE RELEVANT MATERIAL ON RECORD. SECTION 50C CONTAINS DEEMING PROVISIONS IN THE CASES WHETHER THE CONSIDERATION RECEIVED OR ACC RUED AS A RESULT OF TRANSFER OF CAPITAL ASSET, BEING LAND OR BUILDING O R BOTH, IS LESS THAN THE VALUE ADOPTED BY THE STAMP VALUATION AUTHORITY FOR THE PURPOSE OF PAYMENT OF STAMP DUTY, THEN THE VALUE SO ADOPTED S HALL, FOR THE PURPOSES OF COMPUTATION OF CAPITAL GAIN U/S 48 BE DEEMED TO BE THE FULL VALUE OF THE CONSIDERATION RECEIVED OR ACCRUING AS A RESULT OF S UCH TRANSFER. HOWEVER, AS PER SUB.SEC (2) OF SEC. 50(C, IF THE ASSESSEE C LAIMS BEFORE THE ASSESSING OFFICER THAT THE VALUE ADOPTED OR ASSESSE D BY THE STAMP VALUATION AUTHORITY EXCEEDS THE FAIR MARKET VALUE OF THE PROPERTY AS ON THE DATE OF TRANSFER; THEN THE ASSESSING OFFICER MA Y REFER THE VALUATION OF THE CAPITAL ASSET TO THE DVO. THUS, WHEN THE ASSES SEE HAS CLAIMED AND RAISED AN OBJECTION THAT THE VALUATION ADOPTED BY T HE STAMP VALUATION AUTHORITY IS MORE THAN THE FAIR MARKET VALUE OF THE PROPERTY AND POINTED OUT CERTAIN REASONS FOR SUCH CLAIM, THEN THE ASSESS ING OFFICER IS UNDER OBLIGATION TO ADDRESS THE OBJECTIONS RAISED BY THE ASSESSEE AND MAY ALSO REFER THE VALUATION OF THE ASSET TO THE DVO. THOUGH THE LETTER DATED 8.12.2010 WAS FILED BY THE ASSESSEE AFTER THE DATE OF THE ASSESSMENT ORDER; HOWEVER, WHEN THE ASSESSEE HAS RAISED THIS G ROUND BEFORE THE CIT(A), THEN THE CIT(A) HAVING PERENNIAL/CO-TERMIN US POWERS AS OF THE ITA NO. .2610/M/2012 . 5 ASSESSING OFFICER, OUGHT TO HAVE CONSIDERED AND DEC IDED THE OBJECTIONS RAISED BY THE ASSESSEE. 5.1 HAVING CONSIDERED THE FACTS AND CIRCUMSTANCES O F THE CASE AND IN THE INTEREST OF JUSTICE, WE ARE OF THE VIEW THAT TH E OBJECTION RAISED BY THE ASSESSEE FOR REFERRING THE VALUATION TO THE DVO SHO ULD BE CONSIDERED AND DECIDED BY THE AUTHORITIES BELOW. ACCORDINGLY, WE SET ASIDE THE ISSUE OF VALUATION OF THE PROPERTY U/S 50C AND THE OBJECTION /CLAIM MADE BY THE ASSESSEE AGAINST ADOPTION OF THE STAMP DUTY VALUE AS FULL SALE CONSIDERATION INCLUDING REFERENCE TO THE DVO TO THE RECORD OF THE ASSESSING OFFICER FOR CONSIDERING AND DECIDING THE SAME AS PER LAW. 6 IN THE RESULT, THE APPEAL OF THE ASSESSES IS ALLO WED FOR STATISTICAL PURPOSES. 2 .3 % 2. - 4 5- 67#8 #9 . : - . <= ORDER PRONOUNCED IN THE OPEN COURT ON THIS DAY OF 8 TH MAY 2013 . #1 - 0& $# 4 >%3 8 TH = 0 - ? SD/- SD/- ( ! !! ! . ' ' ' ' ) #$ ( D KARUNAKARA RAO ) ACCOUNTANT MEMBER ( ) (VIJAY PAL RAO ) JUDICIAL MEMBER PLACE: MUMBAI : DATED: 8 TH MAY 2013 RAJ* ITA NO. .2610/M/2012 . 6 COPY FORWARDED TO: 1 APPELLANT 2 RESPONDENT 3 CIT 4 CIT(A) 5 DR /TRUE COPY/ BY ORDER DY /AR, ITAT, MUMBAI