G. SUBRAMANIAM (REP. BY L/H S. RAMESH), CHENNAI V. ITO, NON CORPORATE WRD-9(4), CHENNAI

ITA 304/CHNY/2023

AI Insights

The case involves appeals by the legal heir of Late G. Subramaniam against the orders of the Income Tax Officer (ITO), Non-Corporate Ward-9(4), Chennai, concerning the assessment years 2009-10, 2010-11, and 2011-12. The appeals were filed following the dismissal of previous appeals by the Tribunal, which were deemed defective but allowed the filing of fresh appeals. The main issues in the appeals included the application of Section 50C regarding the valuation of a property sold under distress and the legality of the reassessment proceedings initiated by the AO. The Tribunal directed a revaluation of the property by the DVO but upheld the reassessment and the application of Section 50C.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 133949 (ITAT-CHENNAI)
• Duration Of Justice: 1 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-04-2023
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 23-04-2023
• Assessment Year: 2011-2012
• Appeal Filed On: 08-03-2023
• Laws Referred To: Income Tax Act
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Sale consideration of property below Jantri Value; Set aside; Capital Gains

Judgement Text

आयकर अपीलीय अिधकरण ‘बी’ ायपीठ चे ई म । IN THE INCOME TAX APPELLATE TRIBUNAL ‘B’ BENCH, CHENNAI माननीय +ी मनोज कु मार अ/वाल ,लेखा सद4 एवं माननीय +ी मनोमोहन दास, ाियक सद4 के सम8। BEFORE HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM AND HON’BLE SHRI MANOMOHAN DAS, JUDICIAL MEMBER आयकर अपील सं./ ITA Nos.302, 303 & 304/Chny/2023 (िनधा@रण वष@ / Assessment Years:2009-10, 2010-11 & 2011-12) Late G. Subramaniam (Rep. by L/H S. Ramesh) No.117, Old No.56, Sami Naicken Street, Chintadripet, Chennai-600 002. बनाम/ V s. ITO, Non-Corporate Ward-9(4), Chennai. थायी लेखा सं./जीआइ आर सं./P AN /GI R No . AAH P S -8 9 8 5 - M (अपीलाथ /Appellant) : ( थ / Respondent) अपीलाथ की ओरसे/ Appellant by : Shri M. Abhishek (F.C.A) – Ld. AR थ की ओरसे/Respondent by : Shri D. Hema Bhupal (JCIT) –Ld. DR सुनवाई की तारीख/Date of Hearing : 24-04-2023 घोषणा की तारीख /Date of Pronouncement : 24-04-2023 आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member) 1. Aforesaid appeals by assessee for Assessment Years (AYs) 2009-10 to 2011-12 has common facts and issues. These appeals have been filed by the assessee consequent to the orders of Tribunal in assessee’s appeal ITA Nos.114 to 116/Chny/2023 order dated 28.02.2023 wherein the appeals were dismissed as defective with a liberty to the assessee to file fresh appeals against appellate orders and raise fresh grounds of appeal challenging the issues whatever the assessee wants to raise. Accordingly, these appeals have been - 2 - preferred by the assessee. The grounds are common in all the years. In the grounds of appeal, the assessee has submitted that Ld. CIT(A) has failed to call for a remand report and examine the matter and he has no power to set aside. In another ground, the assessee has assailed the reassessment jurisdiction as acquired by Ld. AO. The grievance of the assessee is that these grounds have not been adjudicated in the impugned order. 2. The appeal for AY 2009-10 arises out of the order of learned Commissioner of Income Tax (Appeals)-10, Chennai [CIT(A)] dated 09.11.2018 in the matter of an assessment framed by Ld. AO u/s 143(3) r.w.s. 147 on 31.03.2016. Having heard rival submissions, our adjudication would be as under. 2. The assessee i.e., Late Shri S. Subramaniyam is represented by his legal heir Shri S. Ramesh. The assessee’s return of income was processed u/s 143(1). However, the case was reopened since information was available with the department that the assessee along with 3 others, sold certain land situated at Kancheepuram. Though the consideration received was Rs.80 Lacs, the value adopted by stamp duty authorities was Rs.155.80 Lacs. Accordingly, Ld. AO adopted the same as per Sec.50C disregarding the assessee’s submissions that it was a distress sale. The assessee adopted market value of Rs.15000/- per ground as on 01.04.1981 and worked out Long Term Capital Gains (LTCG) of Rs.16.72 Lacs after indexation and claimed deduction u/s 54EC for Rs.17 Lacs. The Ld. AO, adopting value in terms of Sec.50C, computed LTCG of Rs.18.67 Lacs. 3. During appellate proceedings, the assessee assailed the Sec.50C application on the ground that it was a distress sale. The Ld. - 3 - AO ought to have referred the matter of valuation to DVO in terms of Sec.50C(2). It could be seen that despite being provided with various opportunities of hearing, the assessee failed to attend the appellate proceedings as noted in para 6.3.2 of the impugned order. The Ld. CIT(A), considering the provisions of Sec.50C(2), held that AO could have referred the valuation to DVO when the assessee raised an objection in that respect. Though the assessee did not make such reference before Ld. AO, however, considering the fact that such claim was made before appellate authority, the same could be referred to DVO. Accordingly, Ld. AO was directed to refer the matter of valuation to DVO and adopt such valuation as deemed sale consideration. 4. The assessee also assailed the reassessment proceedings on the ground that reopening was nothing but reappraisal of information already on record. The Ld. CIT(A) held that since the assessee’s main ground with regard to applicability of provisions of Sec.50C(2) was allowed, the legal issues were not required to be dealt with. 5. Aggrieved as aforesaid, the assessee is in further appeal before us. 6. We find that stamp duty valuation was higher and therefore, Ld. AO was bound to adopt the same in terms of Sec.50C of the Act. During appellate proceedings, the assessee pleaded for reference to valuation to DVO on the ground that it was a case of distress sale. Considering the same, Ld. AO was directed to refer the valuation and adopt the valuation so made as deemed sale consideration. We find that Ld. CIT(A) has not set aside the assessment framed by Ld. AO but merely directed him to revise the sale consideration as per valuation made by DVO. The assessee is free to assail the proposed valuation - 4 - before lower authorities. Therefore, the first ground raised by the assessee has no substance and accordingly, rejected. 7. So far as the legal grounds are concerned, we find that sale transactions have not been reflected by the assessee in the original return of income. The case was reopened since information was available with the department with respect to such transaction. It was clear case of escapement of income. Accordingly, no infirmity could be found in the jurisdiction of Ld. AO. Therefore, the legal grounds also stand dismissed accordingly. 8. Since the facts are pari-materia the same in other two years, those appeals are also disposed-off accordingly. 9. All the appeals stand dismissed. Order pronounced on 24 th April, 2023. Sd/- (MANOMOHAN DAS) ाियक सद4 /JUDICIAL MEMBER Sd/- (MANOJ KUMAR AGGARWAL) लेखा सद4 / ACCOUNTANT MEMBER चे*ई / Chennai; िदनांक / Dated : 24-04-2023 EDN/- आदेश की Sितिलिप अ /ेिषत/Copy of the Order forwarded to : 1. अपीलाथ /Appellant 2. यथ /Respondent 3. आयकर आयु3/CIT 4. िवभागीय ितिनिध/DR 5. गाड फाईल/GF