MALHOTRA BUILDCOM P.LTD., Alwar V. ITO, Alwar

ITA 274/JPR/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 9705 (ITAT-JAIPUR)
• Duration Of Justice: 11 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-03-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2011-2012
• Appeal Filed On: 28-03-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R A VERMA CIT DHK
• Assessee Lawyers: SHAILENDRA VIJAY
• Keywords: Sale consideration of property below Jantri Value; Capital asset; Business income
• Section: 50C

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES (SMC), JAIPUR JH HKKXPAN] YS[KK LNL; ] DS LE{K BEFORE: SHRI BHAGCHAND, ACCOUNTANT MEMBER VK;DJ VIHY LA-@ ITA NO. 274/JP/2016 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2011-12 M/S MALHOTRA BUILDCON (P) LTD., B-118, RANJEET NAGAR, 60 FEET ROAD, ALWAR. CUKE VS. INCOME TAX OFFICER, WARD-1(2), ALWAR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AAFCM 5717 J VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI SHAILENDRA VIJAY (ADV) JKTLO DH VKSJ LS@ REVENUE BY : SHRI R.A. VERMA (ADDL.CIT) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 06/03/2017 MN?KKS'K .KK DH RKJH[K @ DATE OF PRONOUNCEMENT : 07/03/2017 VKNS'K@ ORDER PER: BHAGCHAND, A.M. THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER DATED 18/01/2016 PASSED BY THE LD. CIT(A), ALWAR FOR THE A.Y. 2011-12. 2. IN THIS CASE, THIS BENCH VIDE ORDER DATED 26/07/ 2016 HAD DISMISSED THE APPEAL OF THE ASSESSEE DUE TO NON-PRO SECUTION. AGAINST THE SAID ORDER, THE ASSESSEE FILED M.A. AND VIDE OR DER DATED 20/01/2017, THE APPEAL OF THE ASSESSEE WAS RECALLED AND FIXED FOR HEARING. ITA 274/JP/2016_ M/S MALHOTRA BUILDCON PVT. LTD. VS ITO 2 3. THE ONLY ISSUE INVOLVED IN THE PRESENT APPEAL IS INVOKING THE PROVISIONS OF SECTION 50C OF THE INCOME TAX ACT, 196 1 (IN SHORT THE ACT) IN RESPECT OF THE DWELLING UNIT. 4. THE ASSESSEE IS ENGAGED IN THE BUSINESS OF THE PU RCHASING AND SELLING OF RESIDENTIAL PLOTS, FLATS, HOUSES ETC.. D URING THE YEAR, THE ASSESSEE HAS SOLD A RESIDENTIAL UNIT DECLARING SALE CONSIDERATION OF RS. 15,75,000/-. HOWEVER, THE STAMP VALUATION AUTHORITY HAS ADOPTED THE VALUE OF THE PROPERTY AT RS. 16,12,748/- AND THE DI FFERENCE OF RS. 37748/- WAS MADE. 5. DURING THE COURSE OF HEARING, THE LD. AR OF THE ASSESSEE HAS SUBMITTED THAT THE ASSESSEE WAS A BUILDER AND THE UN IT, WHICH HAS BEEN SOLD, WAS A PART OF STOCK IN TRADE AND THE ASSESSEE HAS OFFERED BUSINESS INCOME ON THIS TRANSACTION, THEREFORE, PROVISIONS O F SECTION 50C OF THE ACT CANNOT BE APPLIED IN THE ASSESSEES CASE AS THE SE PROVISIONS ARE APPLICABLE ONLY WHERE THE ASSET WAS HELD AS A CAPITAL ASSET AND THE SAME WAS TRANSFERRED AND THE CAPITAL GAIN PROVISIONS WERE ATTRACTED. 6. AT THE OUTSET, THE LD SR. DR HAS RELIED ON THE O RDERS OF THE LOWER AUTHORITIES. 7. I HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE P ARTIES, PERUSED THE MATERIAL AVAILABLE ON THE RECORD AND ALSO GONE THROUGH THE ORDERS ITA 274/JP/2016_ M/S MALHOTRA BUILDCON PVT. LTD. VS ITO 3 OF THE AUTHORITIES BELOW. SINCE THE ASSESSEE WAS ENGA GED IN THE BUSINESS OF CONSTRUCTION AND DEVELOPMENT OF PROPERT Y AND SELLING THE UNITS. THE UNIT, WHICH HAS BEEN SOLD BY THE ASSESSE E, WAS A TRADING ASSET IN THE ASSESSEES HAND AND IT HAS OFFERED THE INCOME UNDER THE HEAD OF BUSINESS, THEREFORE, PROVISIONS OF SECTION 50C OF THE ACT ARE NOT APPLICABLE IN THE ASSESSEES CASE. HENCE, I SET ASIDE THE ORDER OF THE AUTHORITIES BELOW AND ALLOW THE ASSESSEES APPEA L. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. ORDER PRONOUNCED IN THE OPEN COURT ON 07/03/2017. SD/- HKKXPAN (BHAGCHAND) YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 07 TH MARCH, 2017 *RANJAN VKNS'K DH IZFRFYFI VXZSFKR @ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ @ THE APPELLANT- M/S MALHOTRA BUILDCON (P) LTD., ALWAR. 2. IZR;FKHZ @ THE RESPONDENT- THE ITO, WARD-1(2), ALWAR. 3. VK;DJ VK;QDR @ CIT 4. VK;DJ VK;QDRVIHY @ THE CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ @ DR, ITAT, JAIPUR 6. XKMZ QKBZY @ GUARD FILE (ITA NO. 274/JP/2016) VKNS'KKUQLKJ @ BY ORDER, LGK;D IATHDKJ @ ASST. REGISTRAR