SHARVAN KUMAR SHARMA, Jaipur V. ITO, Jaipur

ITA 307/JPR/2017

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 2047 (ITAT-JAIPUR)
• Duration Of Justice: 5 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-10-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2008-2009
• Appeal Filed On: 24-04-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: POONAM ROY DCIT DHK
• Keywords: Sale consideration of property below Jantri Value; Capital asset; Fair market value
• Section: 50C; 148; 37; 144

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. 307/JP/2017 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2008-09 SHARVAN KUMAR SHARMA, PLOT NO. 50, MALVIYA NAGAR, RAMJIPURA, JAIPUR. CUKE VS. INCOME TAX OFFICER, WARD-6(1), JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AGWPS 1900 R VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI VIJAY GUPTA. JKTLO DH VKSJ LS@ REVENUE BY : SMT. POONAM ROY (DCIT) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 03/10/2017 MN?KKS'K .KK DH RKJH[K @ DATE OF PRONOUNCEMENT : 04/10/2017 VKNS'K@ ORDER PER: BHAGCHAND, A.M. THIS IS AN APPEAL FILED BY THE ASSESSEE EMANATES FR OM THE ORDER OF THE LD. CIT(A)-2, JAIPUR DATED 17/03/2017 FOR THE A .Y. 2008-09, WHEREIN THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL: - 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) WAS NOT JUSTIFIED IN HOLDING THE ADDITION OF RS. 44,74,609/- UNDER THE HEAD CAPITAL GAIN MADE BY THE A.O. THE AC TION OF LD. CIT(A) IS ILLEGAL AND DESERVED TO BE SET ASIDE. THE LD. CIT(A) HAS ERRED BOTH IN FACTS AND IN LAW. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) GROSSLY ERRED IN DISALLOWING DEDUCTION U/S 80C. THE ACTION OF THE LD. ITA 307/JP/2017_ SHARVAN KUMAR SHARMA VS ITO 2 CIT(A) IS ILLEGAL AND DESERVED TO BE SET ASIDE. THE LD. CIT(A) HAS ERRED BOTH IN FACTS AND IN LAW. 2. THE ASSESSEE HAS NOT FILED RETURN OF INCOME FOR T HE ASSESSMENT YEAR 2008-09. NOTICE U/S 148 OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT) ISSUED ON 23/03/2015. INITIALLY, THE ASSESSEE SUBMITTED THAT DURING THE FINANCIAL YEAR 2007-08 RELEVANT TO ASSESSMENT Y EAR 2008-09 HE HAD NOT ENTERED INTO ANY TRANSACTION AS PER HIS KNOWLEDG E. ONLY A POWER OF ATTORNEY WAS EXECUTED IN FAVOUR OF HIM ON BEHALF OF SHRI SANJAY BANSHIWAL, R/O- A-65, NAYA KHEDA, JAIPUR. THE ASSESSE E HAD CLAIMED HAD HE HAD NOT EARNED ANY INCOME. THE ASSESSING OFFI CER DID NOT ACCEPT THE CONTENTION OF THE ASSESSEE AND MADE AN ADDITION OF RS. 44,74,609/- AS LONG TERM CAPITAL GAIN. THE RELEVANT PORTION OF T HE ORDER OF THE ASSESSING OFFICER IS REPRODUCED HEREUNDER: 5. THE ASSESSEE IN RESPONSE TO SHOW CAUSE SUBMITTED HIS SUBMISSION VIDE HIS LETTER DATED 23.02.2016. THE SUBMISSION OF THE ASSESSEE WAS GONE THROUGH CAREFULLY AND DISCUSSED AS UNDER: 5(I). THE ASSESSEE IN HIS EARLIER REPLIES/LETTER H AS DENIED OF HAVING ANY SALE OF PROPERTY AND TRANSACTION. THE ASSESSEE IN H IS EARLIER REPLIES HAS STATED THAT THE PROPERTY WAS SOLD ON BEHALF OF SHRI SANJAY BANSHIWAL AS POWER OF ATTORNEY HOLDER ONLY. HOWEVER AFTER ISSUE OF SHOW CAUSE U/S 144, THE ASSESSEE IN HIS SUBMISSI ON AGREED THAT THE PROPERTY UNDER CONSIDERATION WAS FIRSTLY PURCHA SED BY HIM FROM SANJAY BANSHIWAL FOR RS 10,00,000/- THROUGH AG REEMENT ON 15.05.2000 AND A POWER OF ATTORNEY WAS ALSO EXECUTE D IN HIS ITA 307/JP/2017_ SHARVAN KUMAR SHARMA VS ITO 3 FAVOUR BY SANJAY BANSHIWAL ON 01.02.2008. COPY OF A GREEMENT AND SALE DEED WAS ALSO SUBMITTED ALONG WITH HIS LET TER. AFTERWARDS, THE PROPERTY WAS SOLD OUT TO SMT PALLAV I JAIN FOR CONSIDERATION OF RS 11,50,000/- ON 02.02.2008 AND S ALE DEED WAS GOT EXECUTED IN CAPACITY OF POWER OF ATTORNEY HOLDE R. THEREFORE AS MENTIONED IN SHOW CAUSE ISSUED U/S 144, THE ASSESSE E HAD PURCHASED THE PROPERTY UNDER CONSIDERATION ON POWER OF ATTORNEY AND THUS IT WAS A TRANSFER IN HIS HANDS WITHIN THE MEANING AND PURVIEW OF SECTION 2(47)(V) OF THE IT ACT. THESE FI NDINGS AND FACTS WERE ADMITTED BY THE ASSESSEE IN HIS WRITTEN SUBMIS SION FILED ON 23.02.2016. THE ASSESSEE IN HIS SAID WRITTEN SUBMIS SION HAS SUBMITTED AND CALCULATED CAPITAL LOSS AT RS 2,18,14 2/- TAKING SALES CONSIDERATION AT RS 11,50,000/-. HOWEVER THE VALUE BY STAMP AUTHORITIES WAS ADOPTED AT RS 58,31,751/- BY THE SU B REGISTRAR U/S 54. IN VIEW OF SECTION 50C THE SALES CONSIDERAT ION IS TO TAKEN AT RS 58,31,751/- I.E. THE VALUE ADOPTED BY SUB REG ISTRAR. 5(II) THE ASSESSEE IN HIS WRITTEN SUBMISSION FILED ON 23.02.2016 HAS SUBMITTED THAT THE SECTION 50C IS NOT APPLICABLE IN HIS CASE. THE ASSESSEE VIDE LETTER SUBMITTED ON 23.02.2016 CONTEN DED THAT FOR CALCULATING OF CAPITAL GAIN INCOME THE PROVISIONS O F SECTION 50C IS NOT APPLICABLE IN THE CASE OF THE ASSESSEE. IN THIS REGARD IT HAS BEEN STATED THAT THE RIGHT IN PROPERTY WAS SOLD WIT HOUT HANDING OVER THE POSSESSION OF THE PROPERTY (AS IT WAS ALRE ADY ACQUIRED BY RIICO) AND THE TITLE OF THE PROPERTY WAS ALREADY IN DISPUTE WITH RIICO AND WAS UNDER JUDICIAL REVIEW BY THE COMPETEN T AUTHORITIES/COURTS. 5(III) THE CONTENTION OF THE ASSESSEE IS NOT ACCEPT ABLE, AS THE TRANSACTION TOOK PLACED WELL BEFORE THE DECISION OF THE HONBLE SUPREME COURT. THE HONBLE HIGH COURT, JODHPUR BENC H HAD ITA 307/JP/2017_ SHARVAN KUMAR SHARMA VS ITO 4 DELIVERED ITS DECISION IN FAVOUR OF CO-OPERATIVE SO CIETY. INITIALLY THE PROPERTY (PLOT) WAS ALLOTTED TO SH. SANJAY BANSHIWA L BY SUBHASH SINDHI CO-OPERATIVE HOUSING SOCIETY ON 28.08.87 AND THE POSSESSION WAS TAKEN OVER BY HIM. AFTERWARDS THE PR OPERTY WAS PURCHASED BY THE ASSESSEE THROUGH AGREEMENT AND THE N SOLD OUT FURTHER AND RECEIVED SALES CONSIDERATION. AS PER SA LE DEED THE POSSESSION WAS ALSO HANDED OVER TO THE PURCHASER. T HE PROPERTY WAS SOLD OUT BY THE ASSESSEE AND SALE DEED WAS ALSO GOT EXECUTED WITH THE STAMP AUTHORITIES. WHEN THERE IS CLEAR CUT TRANSACTION OF SALE OF IMMOVABLE PROPERTY IT CANNOT BE SAID AND AC CEPTABLE THAT IT WAS A TRANSFER OF SALE OF RIGHTS ONLY. IN VIEW OF T HE FACTS OF THE CASE IT IS A CLEAR TRANSFER WITHIN THE MEANING AND PURVIEW OF SECTION 2(47) OF THE IT ACT, 1961 AND THE ASSESSEE IS LIABLE TO PAY CAPITAL GAIN TAX AND SECTION 50C OF THE IT ACT IS C LEARLY APPLICABLE IN THE CASE. SECTION 50C IS APPLICABLE ON TRANSFER OF CAPITAL ASSETS BEING LAND OR BUILDING OR BOTH. THE ASSESSEE HAS SOLD OUT LAND IN FORM OF PLOT AND SALE DEED WAS GOT REGISTERED WITH SUB REGISTRAR IN NAME OF PURCHASER AND POSSESSION WAS HANDED OVER TO HER. IF THE PROPERTY WAS ALREADY ACQUIRED BY RIICO, IT COUL D NOT HAVE GOT REGISTERED WITH THE SUB-REGISTRAR. THUS 50C IS CLEA RLY APPLICABLE IN THE CASE. THEREFORE IN VIEW OF THE FACTS OF THE CAS E AS DISCUSSED ABOVE THE ASSESSEE HAS SOLD OUT THE IMMOVABLE PROPE RTY IN SHAPE OF PLOT AND PLEA OF THE ASSESSEE THAT ONLY RIGHTS W ERE SOLD OUT AND THUS SECTION 50C IS NOT APPLICABLE IS NOT ACCEPTABL E. 6. FURTHER THE ASSESSEE IN HIS SUBMISSION DATED 23. 02.2016HAS OBJECTED THE VALUE ADOPTED BY THE STAMP AUTHORITIES AND REQUESTED TO REFER TO VALUATION OFFICER. IT IS PERT INENT TO MENTION HERE THAT THE ASSESSMENT PROCEEDINGS WERE IN PROGRE SS SINCE 23.03.2015 WHEN THE NOTICE U/S 148 WAS ISSUED. IN S PITE KNOWING ITA 307/JP/2017_ SHARVAN KUMAR SHARMA VS ITO 5 THE FACTS THE ASSESSEE NEVER OBJECTED THE VALUE OF THE PROPERTY ADOPTED BY THE STAMP AUTHORITIES DURING THE ASSESSM ENT PROCEEDINGS. FIRSTLY DENIED OF INVOLVEMENT IN TRANS ACTION IN SALE OF PROPERTY AND AFTER ISSUE OF SHOW CAUSE U/S 144 ADMI TTED THE FACTS THAT SALE TRANSACTION WAS MADE AND CONSIDERATION WA S RECEIVED BY HIM ONLY WHICH SHOWS THAT THE ORIGINAL OWNER HAS NO THING TO DO WITH THE SALE TO SMT. PALLAVI JAIN. HOWEVER IN LAST JUNCTURE OF THE PROCEEDINGS VIDE HIS LETTER DATED 23.02.2016 THE AS SESSEE HAS OBJECTED THE VALUE OF THE PROPERTY ADOPTED BY THE S TAMP AUTHORITIES WITHOUT ANY BASIS. AT THE TIME OF REGIS TRATION ALSO THE VALUE WAS NOT OBJECTED BY THE ASSESSEE. THE ASSESSE E SHOULD HAVE OBJECTED THE SAME WELL BEFORE IN TIME WHICH WAS NOT DONE SO. IT SEEMS THAT JUST FOR MAKING OBJECTION ONLY & WITHOUT MERITS IT IS DONE SO. AS THE CASE IS GOING TO BE TIME BARRED ON 31.03.2016, THERE IS NO TIME LEFT FOR THE DVO TO ESTIMATE FAIR MARKET VALUE. IT IS PERTINENT TO MENTION HERE THAT STATUARY REFERENCES TO DVO NORMALLY REQUIRE 120 DAYS. AS SUCH, THE TRANSACTION TOOK PLACE IN THE YEAR 2007, THEREFORE, IT WAS OBLIGATORY ON THE PART OF THE ASSESSEE TO FILE HIS RETURN OF INCOME AND TO DISCLO SE THE INCOME TRULY AND FULLY VOLUNTARILY, THE ASSESSEE FAILED TO DO SO, WHICH PROVE THE CONDUCT OF THE ASSESSEE THAT HE IS EVASIV E AND NEVER TRIED TO DISCLOSE FULL FACTS OF THE CASE. THE ASSES SEE HAS ALSO RELIED UPON SOME OF THE DECISIONS WHICH ARE NOT SQUARELY A PPLICABLE IN THE CASE OF THE ASSESSEE. 3. THE LD. CIT(A) HAS DISMISSED THE APPEAL OF THE ASS ESSEE BY HOLDING AS UNDER: 2.3 I HAVE PERUSED THE FACTS OF THE CASE, THE ASSES SMENT ORDER AND THE SUBMISSIONS OF THE APPELLANT. IT IS NOTED THAT THE ASSESSEE HAD MADE A ITA 307/JP/2017_ SHARVAN KUMAR SHARMA VS ITO 6 SALE OF IMMOVABLE PROPERTY AT RS. 11,50,000/- SALE CONSIDERATION AND NO RETURN OF INCOME HAD BEEN FILED. AS PER INFORMAT ION WITH THE ASSESSING OFFICER, THE VALUE OF THE PROPERTY WAS AD OPTED AT RS.58,31,751/- BY THE SUB- REGISTRAR IV, JAIPUR. TH E ASSESSING OFFICER NOTED THAT THE SAID PROPERTY HAD PURCHASED FOR A CO NSIDERATION OF RS. 10,00,000/- FROM ONE SHRI SANJAY BANSHIWAL THROUGH AN AGREEMENT ON 15.05.2000 AND SOLD TO SMT. PALLAVI JAIN FOR A CONS IDERATION OF RS. 11,50,000/- ON 02.02.2008 AND THE SALE DEED WAS REG ISTERED WITH SUB- REGISTRAR-IV, JAIPUR. FURTHER FACTS OF THE CASE ARE THAT THE PROPERTY WAS INITIALLY ALLOTTED TO SHRI SANJAY BANSIWAL BY M/S S UBHASH SINDHI COOPERATIVE HOUSING SOCIETY LTD. AND A DISPUTE WAS GOING ON BETWEEN RIICO AND THE SOCIETY AS THE LAND HAD BEEN ACQUIRED BY THE GOVERNMENT AND HANDED OVER TO RIICO AND YET THE M/S SUBHASH SINDHI COOPERATIVE SOCIETY HAD PURCHASED THE SAME FROM THE KHATEDARS BEING AWARE OF THE FACT OF ITS ACQUISITION BY THE G OVERNMENT. DURING ASSESSMENT PROCEEDINGS, IT HAS BEEN CONTEND ED THAT PROVISIONS OF SECTION 50C WERE NOT APPLICABLE AS ONLY THE RIGH T IN PROPERTY WAS SOLD WITHOUT HANDING OVER THE POSSESSION OF THE PRO PERTY AND THE TITLE OF THE PROPERTY WAS IN DISPUTE. THE ASSESSING OFFIC ER HELD THAT SINCE THE SALE AND PURCHASE OF IMMOVABLE PROPERTY HAS TAK EN PLACE THAT THE SALE DEED HAD BEEN REGISTERED AND STAMP VALUE DETER MINED AS PER RULES, SECTION 50C WOULD BE APPLICABLE AND CAPITAL GAINS RS.44,74,609/- HAD BEEN ARRIVED AT AS LONG TERM CAPITAL GAIN. IN THE PRESENT PROCEEDINGS, THE AUTHORIZED REPRESE NTATIVE HAS SUBMITTED THAT IN VIEW OF THE DECISION OF THE HON'B LE SUPREME COURT IN THIS CASE THE LAND WHICH WAS SOLD BY KHATEDARS WAS A DISPUTED LAND AND SOLD THROUGH AN AGREEMENT TO THE RESPONDENT SOC IETY ON 21.07.1981. SUBSEQUENTLY, THE SOCIETY WITHOUT ANY C HARGE OR ITA 307/JP/2017_ SHARVAN KUMAR SHARMA VS ITO 7 CONVERSION/ APPROVAL FROM STATE GOVERNMENT SOLD THE LAND TO SHRI SANJAY BANSIWAL WHO IN TURN EXECUTED THE SALE AGREE MENT AND POWER OF ATTORNEY IN FAVOUR OF SHRI SHARWAN KUMAR SHARMA IN MAY, 2007 IN WHICH, IN THE DOCUMENTS IT WAS CLEARLY MENTIONED TH AT THE LAND HAD BEEN ACQUIRED BY THE RLLCO/STATE GOVERNMENT AND IF NOT FREED/RELEASED BY THE GOVERNMENT, PURCHASERS WILL O NLY BE ENTITLED TO COMPENSATION FROM THE RLICO/STATE GOVERNMENT. ON TH E ABOVE BASIS, IT IS CLAIMED THAT THE TRANSACTION BETWEEN SOCIETY TO SANJAY BANSHIWAL, SHARWAN SHARMA TO PALLAVI JI, TO THE ULTIMATE PURCH ASER, IS ONLY TRANSFER OF RIGHTS. RELIANCE WAS PLACED ON THE CASE OF TARA CHAND JAIN VS. IT DATED 09.10.2015 OF ITAT, JAIPUR AND ATUL G. PURANIK VS. ITO OF ITAT, MUMBAI. FURTHER, REQUEST WAS MADE FOR REFEREN CE TO VALUATION OFFICER AS CERTAIN FACTORS NEEDED TO BE CONSIDERED FOR ITS VALUATION. ON THE BASIS OF ALL THE ABOVE, IT WAS SUBMITTED THAT I NVOCATION OF SECTION 50C WAS NOT IN ORDER. DURING THE PROCEEDINGS, THE AUTHORIZED REPRESENTAT IVE WAS REQUIRED TO PRODUCE THE NOTIFICATION BY WHICH THE GOVERNMENT OF RAJASTHAN/RIICO HAD ACQUIRED THE PROPERTY AS ALSO T HE EVIDENCE AND DATE ON WHICH PHYSICAL POSSESSION WAS ACQUIRED BY T HE GOVERNMENT BUT THE AUTHORIZED REPRESENTATIVE EXPLAINED HIS INA BILITY AND PLACED RELIANCE OF THE CONTENTS OF THE ORDER PASSED BY, TH E HON'BLE APEX COURT IN THIS CASE DATED 12.02.2013. CONSIDERING THE ABOVE FACTUAL MATRIX THAT ALL THE PARTIES INVOLVED RIGHT FROM THE M/S SUBHASH SINDHI SOCIETY, IN REFERENCE T O WHICH THE ORDER OF APEX COURT HAS BEEN RENDERED AND THE SUBSEQUENT SELLERS AND PURCHASERS ARE AWARE OF THE ILLEGALITY OF THE TRANS ACTION AS THE LAND HAD ALREADY BEEN ACQUIRED BY THE GOVERNMENT AND HAN DED OVER TO RIICO AS PER THE ORDER. THE AUTHORIZED REPRESENTATI VE IS ALSO RELYING ITA 307/JP/2017_ SHARVAN KUMAR SHARMA VS ITO 8 ON THE FACT THAT SINCE THE APEX COURT HAS HELD THE TRANSACTION AS VOID, THE SALE AND ITS SUBSEQUENT EVENTS ARE ALSO VOID AN D APPLICATION OF SECTION 50C OF THE I.T. ACT. 1961 IS INCORRECT. THE OBSERVATION OF THE HON'BLE COURT REGARDING THE BEHAVIOR OF THE SOCIETY INCLUDED THAT SOCIETY MEMBERS HAD ENTERED I NTO AN AGREEMENT TO SELL EVEN THOUGH, A NOTIFICATION UNDER SECTION 4 TO CARRY OUT ACQUISITION HAD BEEN ISSUED BY THE GOVERNMENT, FULL Y KNOWING THE LEGAL IMPLICATION THAT MAY ARISE AND THE BONAFIDE OF THE SOCIETY HAD BEEN QUESTIONED. HOWEVER, THE RELEVANT AND IMPORTANT POI NT IS THAT AT THE TIME OF THE SALE TRANSACTION THE HON'BLE RAJASTHAN HIGH COURTS ORDER WAS IN FORCE IN THIS CASE, IN WHICH IT HAD BEEN RUL ED AS FOLLOWS (PARA 27 OF THE APEX COURTS ORDER): IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO. 7254 OF 2003 THE RAJASTHAN STATE INDUSTRIAL DEVELOPMENT .APPELL ANT AND INVESTMENT CORPORATION VERSUS SUBHASH SINDHI COOPERATIVE HOUSING SOCIETY RESPOND ENTS JAIPUR & ORS. WITH CIVIL APPEAL NO. 853 OF 2013 J U D G M E N T DR. B. S. CHAUHAN, J. 1. THESE APPEALS HAVE BEEN PREFERRED AGAINST THE IMPUG NED JUDGMENT AND ORDER DATED 30.7.2002 PASSED BY THE HIGH COURT OF R AJASTHAN (JAIPUR BENCH) IN CIVIL WRIT PETITION NO. 454 OF 1993, BY W HICH THE HIGH COURT HAS ISSUED DIRECTIONS TO THE RAJASTHAN STATE INDUST RIAL DEVELOPMENT AND INVESTMENT CORPORATION (IN SHORT `RIICO), THE APPE LLANT HEREIN, TO RELEASE THE LAND IN DISPUTE FROM LAND PAGE 2 ACQUIS ITION IN FAVOUR OF RESPONDENT NO.1 - HOUSING SOCIETY (HEREINAFTER REFE RRED TO AS `THE SOCIETY). ITA 307/JP/2017_ SHARVAN KUMAR SHARMA VS ITO 9 27. A LARGE NUMBER OF ISSUES WERE AGITATED BEFORE T HE HIGH COURT, HOWEVER, THE HIGH COURT DID NOT DEAL WITH ANY OF THOSE. THE COURT ALLOWED THE PETITION MERELY OBSERVING: THE PETITIONER SUBHASH SINDHI COOPERATIVE HOUSING SOCIETY IS CONTESTING ONLY FOR A LIMITED PIECE OF LAND MEASURI NG 17 BIGHAS 9 BISWAS WHICH HAD BEEN ACQUIRED AND GIVEN TO DGDC BY THE RI ICO. THE CASE OF THE SOCIETY IS THAT IN VIEW OF THE OBSERVATIONS MAD E BY THE SUPREME COURT IN ITS ORDER, IT HAS PLEADED ITS CASE IN THIS PETITION ON THE BASIS THAT THE OTHER LAND WHICH HAD BEEN ACQUIRED HAD BEEN REL EASED OR IT STOOD DE FACTO RELEASED AND THE GOVERNMENT WAS ITSELF A P ARTY TO IT IN RELEASING THE ACQUIRED LAND AND LARGE NUMBER OF LANDS OF THIS NATURE DE FACTO STOOD RELEASED FROM ACQUISITION INASMUCH AS HOUSES HAVE BEEN CONSTRUCTED THEREON; THE GOVERNMENT ITSELF HAS ACQU IESCED WITH SUCH CONSTRUCTION AND HAS ALSO TAKEN STEPS FOR REGULARIS ATION OF SUCH CONSTRUCTION AND THE DECISION WHICH WAS TAKEN BY TH E JDA IN THE MEETING HEADED BY THE CHIEF MINISTER WAS IMPLEMENTE D QUA ALL OTHERS EXCEPT THE LAND OF PETITIONER SOCIETY, MERELY BECAU SE THE PETITIONER SOCIETYS LAND HAD BEEN GIVEN TO DGDC/RIICO. THIS S MALL PIECE OF LAND WHICH IS CLAIMED BY THE SOCIETY IN THE FACTS AND CI RCUMSTANCES OF THE CASE, CAN VERY WELL BE RESTORED TO THE SOCIETY AND TO THAT EXTENT, LAND ALLOTTED TO DGDC CAN BE CURTAILED WITHOUT HAVING AN Y ADVERSE IMPACT ON THE PROSPECTS OF BUSINESS OF DGDC. FACTS HAVE COME ON RECORD THROUGH DOCUMENTS THAT TO START WITH, DGDC HAD DEMANDED ONL Y 35 ACRES OF LAND. THIS DEMAND WAS RAISED FROM TIME TO TIME AND ULTIMATELY, IT REACHED UPTO 105 ACRES. IT IS ALSO ON RECORD THAT T HE RIICO HAD GIVEN ONLY 80 ACRES OF LAND TO DGDC AS AGAINST THE ALLOTM ENT OF 105 ACRES. IN SUCH A SITUATION, IF A SMALL PIECE OF LAND MEASURIN G 17 BIGHAS 9 BISWAS OUT OF THE LAND ALLOTTED TO DGDC IS RESTORED BACK T O THE PETITIONER SOCIETY IT CANNOT HAVE ANY ADVERSE IMPACT ON THE BU SINESS PROSPECTS OF DGDC NOR THE RIICO MAY 29 PAGE 30 HAVE ANY JUST OBJ ECTION AND THE STATE GOVERNMENT WHICH HAS ALREADY ACQUIESCED WITH THE RELEASE OF SUCH ACQUIRED LANDS IN LARGE NUMBER OF CASES, CANNO T HAVE ANY LEGITIMATE CASE TO CONTEST THE GRANT OF RELIEF TO T HE PETITIONER SOCIETY AND THE PETITIONER SOCIETY IS FOUND TO BE ENTITLED FOR THE SAME ON THE PRINCIPLES OF PARITY AS WELL AS EQUITY. DUE TO THE SAME, THE OWNERSHIP OF THE LAND WAS LEG AL AT THE TIME OF REGISTRATION OF SALE DEED AND VESTED WITH THE SELLE R. FURTHER, THE NOTING ITA 307/JP/2017_ SHARVAN KUMAR SHARMA VS ITO 10 IN THE REGISTERED SALE DEED REGARDING THE LAND AND ITS OWNERSHIP ARE REPRODUCED BELOW: ;G FD EQ[R;KJDRKZ JH LAT; CA'KHOKY DKS LQHKKK FLU/ KH DKS VKWIJSFVO GKMFLAX LKSLK;VH FY- T;IQJ JFT- UECJ 1588 ,Y DS VKOAVU I= }KJK IYKV UECJ 120 ;KSTUK LA[;K 23 R:N;K UXJ] T;IQJ ESA VKOAFVR FD;K X;K FKK FTLDH VFXZE JKF'K ,O A IZOS'K 'KQYD O 210@& :I;S TFJ;S JLHN EKAD 258 FNUAKD 8-8- 1981 BZLOH DKS TEK DJK FN;S FKS] RRI'PKR~ LFEFR DS LA'KK SF/KR EKUFP=KUQLKJ IYKV UECJ 120 DS LFKKU IJ IYKV UECJ 11 3 IFJOFRZR DJ FN;K X;K RFKK LFEFR }KJK VKOAVU I= FNUK AD 28- 08-1987 BZLOH DKS MDR LFEFR ESA TEK DJKDJ MDR OF.KZ R IYKV DK OKLRFOD DCTK E; LKBV IYKU DS IZKIR DJ FY;K FKKA BL IZDKJ EQ[R;KJDRKZ JH LAT; CA'KHYKY MIJKSDR OF.KZR I YKV UECJ 113 IQJKUK UECJ 120 ;KSTUK LA[;K 23 R:NK;K UXJ] V KSAD JKSM] T;IQJ DK FCUK FDLH VU; O;FDR DS LHJ O LK{KS DS ,D E K= EKFYD] LOKEH O VF/KDKJH GSA] FTLDKS EQ[R;KJDRKZ US VKT RD FDLH HKH VU; O;FDR DKS JGU] FO; O GLRKURFJR VKFN U GH FD;K GS RFKK MDR OF.KZR IYKV JHDKS DS VFRJFDR IZR;S D IZDKJ DS >XM+S V.VS] VOKFIR] _.K HKKJ LJDKJH] V}ZLJDKJH] CSA D O TULK/KKJ.K LS EQDR GS RFKK FDLH DTKZ] DQDHZ FMDH O VUQCU/K I= }KJK HKH CFU/KR UGHA GS ,OA BLDS FOK; ESA E[R;KJDR KZ DKS IZR;SD IZDKJ LS VIUS DKE ESA YSUS O JGU] FO; O GLRKURFJR VKFN DJUS DS LEIW.KZ LOROKF/KDKJ EKFYDKUK GD IZKIR GSA ;G FD FO; FD;S X;S IYKV DS LECU/K ESA JHDKS DS VF RFJDR VKT LS IGYS DH DKSBZ CDK;K JKF'K] DKSBZ >XM+K] V.VK] _. K HKKJ ITA 307/JP/2017_ SHARVAN KUMAR SHARMA VS ITO 11 LJDKJH] V}ZLJDKJH] CSAD O TULK/KKJ.K DK IK;K X;K VF KOK BL FCPKSRH DS FO:} DKSBZ O;FDR] CSAD O LALFKK FDLH IZD KJ DH VKIFRR ;K VK{KSI DJRS GSA RKS MU LELR DS FUIVKJS DH FTEESNKJH EQ[R;KJDRKZ IZFKE I{K DH GKSXH RFKK VKT DS I'PKR~ D H LELR FTEESNKJH F}RH;I{K DH GKSXH ,OA HKFO; ESA YXUS OKY S LELR VSDLST] FU;EU 'KQYD] 'KGJH TEKCUNH] LHOJST PKTZ VKF N LELR F}RH; I{K GH VIUS IKL LS TEK DJKOSXHA ;G FD MDR OF.KZR LEIFRR JHDKS DH VOKFIR ESA GS RFK K EKUUH; MPPRE U;K;KY; DS ;GK OKN FOPKJK/KHU GS] FTLDH TKUDK JH F}RH;I{K DKS NS NH GS RFKK BLDH LELR FTEESNKJH F}RH ;I{K DH LOA; DH GKSXHA ;G FD FO; FD;S X;S IYKV LS LECFU/KR LELR VLY DKXT KR IZFKEI{K US F}RH;I{K DKS LEHKYK FN;S GSA IN VIEW OF THE DISCUSSION AS ABOVE, IT IS CLEAR TH AT ON THE DATE OF TRANSACTION, THE OWNERSHIP OF THE LAND WAS WITH THE APPELLANT AS PER THE ORDER OF THE JURISDICTIONAL HIGH COURT IN FORCE AT THAT TIME. THE REGISTERED SALE DEED CLEARLY SHOWS THAT THE LAND WA S TRANSFERRED FOR A CONSIDERATION AND ALL THE PAPERS OF OWNERSHIP WERE HANDED OVER. IN VIEW OF THE ABOVE, THE VALUE ADOPTED BY STAMP VALUA TION AUTHORITY HAS TO BE ADOPTED. AS REGARDS REFERENCE TO VALUATION OF FICER, THE SAME WAS REQUESTED FOR BY THE ASSESSEE AT THE FAG END OF THE FINANCIAL YEAR AND THE TIME WAS INSUFFICIENT FOR THE SAME AND THE ASSE SSMENT WAS GETTING TIME BARRED. THE COMPLIANCE WAS MADE TO THE SHOW CA USE NOTICE UNDER SECTION 144(1) ON 01.02.2016. IN VIEW OF THE ABOVE, THE APPLICATION OF SECTION 50C IS UPHELD AND THE ADDITI ON OF RS.44,74,609/- UNDER THE HEAD LONG TERM CAPITAL GAIN IS CONFIRMED. ITA 307/JP/2017_ SHARVAN KUMAR SHARMA VS ITO 12 4. WHILE PLEADING ON BEHALF OF THE ASSESSEE, THE LD AR OF THE ASSESSEE HAS SUBMITTED THAT THE ASSESSEE HAS NOT SO LD OUT ANY PROPERTY, THEREFORE, THE PROVISIONS OF SECTION 50C OF THE ACT ARE NOT APPLICABLE. HE CLAIMED THAT THE PROPERTY WAS SOLD WITHOUT HANDING OV ER THE POSSESSION AND THE TITLE OF THE PROPERTY WAS IN DISPUTE. 5. ON THE OTHER HAND, THE LD DR HAS SUBMITTED THAT THE ASSESSEE HAS SOLD THE PLOT OF LAND, WHICH WAS ALLOTTED TO HIM BY A COOPERATIVE SOCIETY AND THE SALE DEED CLEARLY MENTIONS IN THIS REGARD, THEREFORE, THERE IS NO MERIT IN THE CLAIM OF THE ASSESSEE. 6. AFTER HEARING BOTH THE SIDES, I HOLD THAT THIS WA S A TRANSFER OF A PLOT, WHICH WAS ALLOTTED TO ITS MEMBER BY A COOPERATI VE SOCIETY, WHICH WAS PURCHASED BY THE ASSESSED AND SOLD. THEREFORE, T HERE IS NO SUBSTANCE IN THE PLEADINGS OF THE ASSESSEE. THE FACT S AND CIRCUMSTANCES OF THE CASE ARE CLEARLY SHOWS THAT THE PROVISIONS OF SECTION 50C OF THE ACT ARE APPLICABLE AND IT WAS A TRANSFER OF A CAPITA L ASSET BEING PLOT OF LAND. 7. THE SECOND ARGUMENT OF THE LD AR OF THE ASSESSEE WAS THAT THE ASSESSEE HAS SUBMITTED BEFORE THE A.O. THAT THE VAL UE ADOPTED BY THE STAMP VALUATION AUTHORITY WAS ON A HIGHER SIDE AND R EQUESTED TO THE ASSESSING OFFICER TO REFER THE MATTER TO THE VALUAT ION OFFICER BUT THE ITA 307/JP/2017_ SHARVAN KUMAR SHARMA VS ITO 13 SAME WAS NOT DONE. THE ASSESSING OFFICER DISMISSED TH E CLAIM OF THE ASSESSEE FOR THE REASON THAT THE ASSESSMENT WAS GETT ING TIME BARRED AND THERE IS NO TIME LEFT FOR THE DVO TO ESTIMATE T HE FAIR MARKET VALUE. FOR READY REFERENCE, THE PROVISIONS OF SECTION 50C( 2) OF THE ACT READ AS UNDER: 50C (2) WITHOUT PREJUDICE TO THE PROVISIONS OF SUB-SECT ION (1), WHERE ( A ) THE ASSESSEE CLAIMS BEFORE ANY ASSESSING OFFICER THAT THE VALUE ADOPTED OR ASSESSED OR ASSESSABLE BY THE STAMP VALUATION AUTHO RITY UNDER SUB-SECTION (1) EXCEEDS THE FAIR MARKET VALUE OF THE PROPERTY AS ON THE DATE OF TRANSFER; ( B ) THE VALUE SO ADOPTED OR ASSESSED OR ASSESSABLE B Y THE STAMP VALUATION AUTHORITY UNDER SUB-SECTION (1) HAS NOT BEEN DISPUTED IN ANY APPEAL OR REVISION OR NO REFERENCE HAS BEEN MADE BEFORE ANY OTHER AUTHORITY, COURT OR THE HIGH COURT, THE ASSESSING OFFICER MAY REFER THE VALUATION OF TH E CAPITAL ASSET TO A VALUATION OFFICER AND WHERE ANY SUCH REFERENCE IS MADE, THE P ROVISIONS OF SUB-SECTIONS (2), (3), (4), (5) AND (6) OF SECTION 16A, CLAUSE ( I ) OF SUB-SECTION (1) AND SUB- SECTIONS (6) AND (7) OF SECTION 23A, SUB-SECTION (5 ) OF SECTION 24, SECTION 34AA, SECTION 35 AND SECTION 37 OF THE WEALTH-TAX A CT, 1957 (27 OF 1957), SHALL, WITH NECESSARY MODIFICATIONS, APPLY IN RELAT ION TO SUCH REFERENCE AS THEY APPLY IN RELATION TO A REFERENCE MADE BY THE ASSESS ING OFFICER UNDER SUB- SECTION (1) OF SECTION 16A OF THAT ACT. EXPLANATION 1 . FOR THE PURPOSES OF THIS SECTION, 'VALUATION OFFICE R' SHALL HAVE THE SAME MEANING AS IN CLAUSE ( R ) OF SECTION 2 OF THE WEALTH-TAX ACT, 1957 (27 OF 1957). EXPLANATION 2. FOR THE PURPOSES OF THIS SECTION, THE EXPRESSION 'A SSESSABLE' MEANS THE PRICE WHICH THE STAMP VALUATION AUTHORITY WOULD HAVE, NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN ANY OTHER LAW FOR THE TIME BEING IN FORCE, ADOPTED OR ASSESSED, IF IT WER E REFERRED TO SUCH AUTHORITY FOR THE PURPOSES OF THE PAYMENT OF STAMP DUTY. THUS, THE PROVISIONS OF THE ACT PROVIDES THAT WHERE T HE ASSESSEE CLAIMS BEFORE THE ASSESSING OFFICER THAT THE VALUE ADOPTED OR ASSESSED BY THE STAMP VALUATION AUTHORITY UNDER SUB-SECTION (1) EXC EEDS THE FAIR MARKET VALUE OF THE PROPERTY AS ON THE DATE OF TRAN SFER THEN THE ASSESSING OFFICER MAY REFER THE VALUATION OF THE CA PITAL ASSET TO THE ITA 307/JP/2017_ SHARVAN KUMAR SHARMA VS ITO 14 VALUATION OFFICER. THUS THE ASSESSEES REQUEST SHOUL D HAVE BEEN ACCEPTED WITH REGARD TO REFERENCE TO DVO. THEREFORE, IN MY CONSIDERED VIEW AND IN THE INTEREST OF JUSTICE AND EQUITY, I F IND IT APPROPRIATE TO RESTORE THE MATTER TO THE FILE OF THE ASSESSING OFF ICER WITH A DIRECTION THAT THE MATTER MAY BE REFERRED TO THE VALUATION OF FICER AS PER THE PROVISIONS OF SECTION AND DECIDE THE ISSUE AFRESH. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS AL LOWED FOR STATISTICAL PURPOSES ONLY. ORDER PRONOUNCED IN THE OPEN COURT ON 04/10/2017. SD/- HKKXPAN (BHAGCHAND) YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 04 TH OCTOBER, 2017 *RANJAN VKNS'K DH IZFRFYFI VXZSFKR @ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ @ THE APPELLANT- SHRI SHARVAN KUMAR SHARMA, JAIPUR. 2. IZR;FKHZ @ THE RESPONDENT- THE ITO, WARD-6(1), JAIPUR. 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. 307/JP/2017) VKNS'KKUQLKJ @ BY ORDER, LGK;D IATHDKJ @ ASST. REGISTRAR