Soldier Scholars Study Circle, Hyderabad V. Income Tax Officer, Ward-6(3), Hyderabad

ITA 314/Hyd/2018

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 4159 (ITAT-HYDERABAD)
• Duration Of Justice: 6 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-08-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 13-08-2018
• Assessment Year: 2009-2010
• Appeal Filed On: 13-02-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: M NARMADA
• Assessee Lawyers: LAXMINIWAS SHAR MA
• Keywords: Sale consideration of property below Jantri Value; Fair market value; Condonation of delay
• Section: 143(3); 50C

Judgement Text

ITA NO 314 OF 2018 SOLDIER SCHOL ARS STUDY CIRCLE HYDERABAD. PAGE 1 OF 6 IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD B BENCH, HYDERABAD BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER ITA NO.314/HYD/2018 (ASSESSMENT YEAR: 2009-10) SOLDIER SCHOLARS STUDY CIRCLE, HYDERABAD PAN: AAITS6048Q VS INCOME TAX OFFICER WARD 6(3) HYDERABAD (APPELLANT) (RESPONDENT) FOR ASSESSEE : SHRI LAXMINIWAS SHARMA FOR REVENUE : SMT. M. NARMADA, DR O R D E R PER SMT. P. MADHAVI DEVI, J.M. THIS IS ASSESSEES APPEAL FOR THE A.Y 2009-10 AGAIN ST THE ORDER OF THE LEARNED CIT (A)-IV, HYDERABAD, DAT ED 18.01.2013. 2. AT THE OUTSET, IT IS NOTICED THAT THERE IS A DEL AY OF 1760 DAYS IN FILING OF THE APPEAL BEFORE US. THE ASSESSE E HAS FILED AN APPLICATION FOR CONDONATION OF DELAY ALONGWITH AN A FFIDAVIT STATING AS UNDER: BEFORE THE INCOME TAX APPELLATE TRIBUNAL, HYDERABAD I, PANDU RANGA REDDY, PRESIDENT OF SOLDIER SCHOLARS STUDY CIRCLE (PAN: AAITS6048Q), , RESIDENT OF FLAT NO. 501 SHANTI SOUDHA APARTMENTS, ERRAMANZIL COLONY, SOMAJIGUDA HYDERABAD 500004, HEREBY SOLEMNLY AFFIRM AND DECLARE AS UNDER: DATE OF HEARING: 13.08.2018 DATE OF PRONOUNCEMENT: 1 7 . 0 8 .2018 ITA NO 314 OF 2018 SOLDIER SCHOL ARS STUDY CIRCLE HYDERABAD. PAGE 2 OF 6 SOLDIER SCHOLARS STUDY CIRCLE ('ASSESSEE') IS A REGISTERED EDUCATIONAL SOCIETY AND HAS BEEN PROVIDING GUIDANCE TO THE ASPIRING CANDIDATES TO CI VIL SERVICES SINCE 1983. SOCIETY IS SET UP TO EDUCATE A ND TRAIN STUDENTS AND TO UNDERTAKE RESEARCH IN RELATED FIELDS. ASSESSEE FILED ITS RETURN OF INCOME FOR THE ASSESSMENT YEAR 2009-10, DECLARING A TOTAL INCOME OF RS.44,19,890/- .THE CASE WAS SELECTED FOR SCRUTINY, ASSESSING OFFICER PASSED AN ORDER U/S 143(3) DETERMINING TOTAL INCOME OF RS.5,10,18,594/- . DURING THE F.Y 2008-09, ASSESSE HAS SOLD A PROPERTY FOR A SALE CONSIDERATION OF RS.3,00,00,000/-. WHILE PASSING THE ASSESSMENT ORDER, AO INVOKED THE PROVISIONS OF SECTION 50C AND ADOPTED REGISTERED VALUE OF RS.5,16,67,000/- AS SALE CONSIDERATION AND RE-COMPUTED THE TOTAL , INCOME. AGGRIEVED BY THE ADDITION MADE, WE FILED AN APPEAL BEFORE C.I.T (A) - IV, HYDERABAD AND THE LEARNED CIT(A) VIDE ITS ORDER ITA 481/ITO 6(3)/CIT(A)-IV /2011-12 DATED 18/01/2013 PARTLY ALLOWED THE APPEAL IN OUR FAVOUR AND DIRECTED AO TO CONSIDER TH E FAIR MARKET VALUE OF RS.3,80,12,000/- ESTIMATED BY THE DVO. HOWEVER THE FAIR MARKET VALUE ESTIMATED BY DVO IS ALSO EXCESSIVE AS THE SAME IS NOT ESTIMATED BY CONSIDERING THE PECULIAR FACTS OF THE CASE LE TH E PROPERTY SOLD IS SITUATED IN A NON-MUNICIPAL AREA, IS SUBJECT TO MANY RESTRICTIONS FROM GOVERNMENT LIKE MAINTAINING OF BUFFER ZONE, HANDING OVER THE AREA F OR ROAD WIDENING WITHOUT ANY COMPENSATION, DEVELOPMENT OF ROADS ETC. AND IN THESE CIRCUMSTANCE S THE PROPERTY WILL NOT FETCH THE FAIR MARKET VALUE A S ESTIMATED BY THE DVO. DURING THE TIME WHEN PROCEEDINGS WERE GOING ON BEFORE CIT-CA) AND WHEN THE APPELLATE ORDER WAS PASSED, I MADE LOT OF EFFORTS TO COLLECT SUPPORTING DOCUMENT BUT AS THIS DOCUMENT IS NOT PUBLICLY AVAILABLE, I DID NOT HAVE THIS DOCUMENT TO PRODUCE BEFORE CITCA) AND THEREFORE I COULDN'T PREFER SECON D APPEAL .HOWEVER NOW AFTER CONTINUOUSLY STRIVING FOR ALMOST FIVE YEARS I AM ABLE TO OBTAIN GOVERNMENT'S ORDER IMPOSING RESTRICTIONS ON THE AREA IN WHICH TH IS PROPERTY IS LOCATED. THIS DOCUMENT WOULD HAVE BEEN AVAILABLE WITH DVO AND THE DVO OUGHT TO HAVE CONSIDERED THIS WHILE ESTIMATING THE VALUE. THE ABOVE CITED GO MANDATES 100/30 METERS BUFFER ZONE FROM THE TANK WHILE OBTAINING PERMISSION. THIS ITA NO 314 OF 2018 SOLDIER SCHOL ARS STUDY CIRCLE HYDERABAD. PAGE 3 OF 6 BUFFER ZONE AREA IS 784 SQ. YARDS. THE GOVERNMENT WIDENED THE ROAD AND 1628 SQ. YARDS WAS TAKEN AND NO COMPENSATION WAS PAID. FURTHER IN THE PLAN OPEN SPACE OF 528 SQ. YARDS WAS LEFT. THEREFORE THI S AREA WAS NEVER AVAILABLE WITH ASSESSE FOR SALE AND THEREFORE THE VALUE AS ADOPTED FOR FULL AREA SHOULD NOT BE TAKEN AS SALE CONSIDERATION BY INVOKING PROVISION OF SECTION 50C. I AM A SENIOR CITIZEN AND DO NOT EARN SO MUCH OF INCOME TO AFFORD TO PAY HUGE TAX LIABILITY AND INTE REST THERE ON. I AM BEING HARASSED BY DEPARTMENT FROM LONG-TIME FOR THE OUTSTANDING DEMAND. A LOT OF HARDSHIP IS BEING CAUSED TO BE DUE TO THIS DEMAND. WITH LOT OF DIFFICULTY I HAVE BEEN ABLE TO OBTAIN T HE SUPPORTING DOCUMENT AND WITH THE HELP OF IT I WILL BE ABLE TO PROVE AS TO WHY THE VALUE ADOPTED BY DVO SHOULD NOT BE CONSIDERED AS SALE CONSIDERATION, HENCE PROVISIONS OF SECTION 50C ARE NOT APPLICABLE IN MY CASE. IN VIEW OF THE FOREGOING I PRAY YOUR GOOD-SELVES TO PLEASE CONDONE THE DELAY OF 1,767 DAYS IN FILING OF THIS APPEAL AND ALLOW ME TO PRESENT MY CASE. PANDU RANGA REDDY PRESIDENT SOLDIER SCHOLARS STUDY CIRCLE DATE: 22/03/2018 PLACE: HYDERABAD 3. THE LEARNED COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE IN THE AFFIDAVIT AND IN SUPPORT OF HIS CONTENTION THAT HE HAS BEEN PURSUING BEFORE THE STA TE GOVERNMENT FOR SECURING THE COPY OF THE G.O, HE HAS FILED THE COPIES OF TWO LETTERS DATED 4.1.2013 AND 7.4.2015. IN THE LETTER DATED 4.1.2013, THE ASSESSEE HAS STATED THAT THE LA ND OF THREE ACRES HAS BEEN SOLD IN JULY, 2008 AND THE SALE CONS IDERATION WAS RS.3.00 CRORES AND THAT THE BUYER HAS INFORMED THAT THE LAND IS SUBJECT TO VARIOUS RESTRICTIONS IN CONSTRUCTION VID E G.O. NO.71 AND REQUESTED COPY OF THE SAID G.O. THERE IS A REFE RENCE TO THIS LETTER ALSO IN THE LETTER DATED 7.4.2015. THEREFORE , THE ASSESSEE ITA NO 314 OF 2018 SOLDIER SCHOL ARS STUDY CIRCLE HYDERABAD. PAGE 4 OF 6 APPEARS TO HAVE BEEN PURSUING WITH THE DEPARTMENT O F MUNICIPAL ADMINISTRATION, GHMC, HYDERABAD FOR THE COPY OF THE GO, THOUGH NOT VERY DILIGENTLY. THE LEARNED COUNSEL FOR THE AS SESSEE SUBMITTED THAT THOUGH NOTHING HAS BEEN FILED IN WRI TING, THE ASSESSEE HAS BEEN PURSUING THE DEPARTMENT PERSONALL Y AND FACED DIFFICULTIES AND THAT THE ASSESSEE HAS RECEIVED A C OPY OF THE G.O IN 2018 WHEN THE PERMISSION FOR CONSTRUCTION WAS ALSO GRANTED AND THEREAFTER, THE ASSESSEE HAD IMMEDIATELY FILED THE APPEAL BEFORE THE TRIBUNAL. HE SUBMITTED THAT IN THE INTEREST OF JUSTICE, THE DELAY SHOULD BE CONDONED AND THE VALUATION OF THE P ROPERTY SHOULD BE CONSIDERED IN THE LIGHT OF GO NO.71. 4. THE LEARNED DR, HOWEVER, OPPOSED THE CONDONATION OF THE DELAY. SHE SUBMITTED THAT THE ASSESSEE HAS FAIL ED TO PROVE THAT HE HAS BEEN DILIGENT IN PURSUING THE APPLICATI ON BEFORE THE GOVT. AND HAD NOT GIVEN ANY EXPLANATION AS TO WHY H E COULD NOT FILE THE APPEAL WITHOUT THE COPY OF THE G.O. THEREF ORE, ACCORDING TO HER, THE DELAY IS NOT TO BE CONDONED. BOTH THE P ARTIES RELIED UPON CASE LAW IN FAVOUR OF THEIR CONTENTIONS. 5. HAVING REGARD TO THE RIVAL CONTENTIONS AND THE M ATERIAL ON RECORD, WE FIND THAT THE ASSESSEE IS AN EDUCATIO NAL INSTITUTION AND HAS SOLD A PROPERTY AND THE DISPUTE WAS ONLY WI TH REGARD TO THE VALUATION U/S 50C OF THE ACT. THE ASSESSEE IS T AKING REFUGE UNDER THE GO NO.71 FOR THE RESTRICTIONS PLACED ON C ONSTRUCTIONS IN THE PROPERTY FOR TAKING A LOWER VALUE. HE STATED THAT THE PURCHASER HAD APPLIED FOR PERMISSION FOR CONSTRUCTI ON AND OBTAINED THE PERMISSION ONLY IN THE YEAR 2018 WHERE IN THERE IS A ITA NO 314 OF 2018 SOLDIER SCHOL ARS STUDY CIRCLE HYDERABAD. PAGE 5 OF 6 REFERENCE TO THE G.O AND HAD THUS STATED THAT THE A SSESSEE COULD OBTAIN THE COPY OF THE G.O ONLY IN 2018 AND HAS FIL ED THE APPEAL THEREAFTER. WE FIND THAT THE ASSESSEE HAS MADE AN A PPLICATION ON 4.1.2003, I.E. EVEN WHEN THE PROCEEDINGS WERE PENDI NG BEFORE THE CIT (A) FOR THE COPY OF THE GO, AND HAD FILED ANOTH ER LETTER IN THE YEAR 2015. THE HON'BLE SUPREME COURT IN THE CASE OF COLLECTOR, LAND ACQUISITION VS. MST. KATIJI AND ORS (1987) REP ORTED IN 167 ITR 471 (S.C) OBSERVED THAT WHILE INTERPRETING THE WORDS SUFFICIENT CAUSE, DUE REGARD SHOULD BE GIVEN TO T HE MERITS OF THE CASE. IT HAS BEEN HELD THAT REFUSING TO CONDONE DEL AY CAN RESULT IN A MERITORIOUS MATTER BEING THROWN OUT AT THE THRESH OLD AND CAUSE OF JUSTICE BEING DEFEATED. THIS DECISION HAS BEEN CONSIDERED AND FOLLOWED BY THE COORDINATE BENCHES OF THIS TRIBUNAL IN A NUMBER OF CASES. THE LEARNED DR HAS RELIED UPON THE DECISI ON OF THE COORDINATE BENCH IN THE CASE OF SHRI T. KISHAN VS. ACIT IN IT(SS)A NO.23 & 25/HYD/2011 DATED 18.5.2012 WHEREIN ALSO TH ERE WAS A DELAY OF 2491 DAYS IN FILING APPEAL BEFORE THE CIT (A) AND EVEN THE ADMITTED TAXES OF THE RETURNED INCOME WAS PAID BELA TEDLY. THEREFORE, THE SAID DECISION IS DISTINGUISHABLE FRO M THE FACTS OF THE CASE BEFORE US. RESPECTFULLY FOLLOWING THE DECI SION OF THE HON'BLE SUPREME COURT IN THE CASE OF COLLECTOR, LAN D ACQUISITION VS. MST. KATIJI AND ORS (1987) (SUPRA), WE ARE INCL INED TO CONDONE THE DELAY AND REMAND THE ISSUE TO THE FILE OF THE A O FOR RECONSIDERATION IN THE LIGHT OF THE GO NO.71, DATED 7.2.2007 ISSUED BY THE DEPARTMENT OF MUNICIPAL ADMINISTRATIO N, GREATER HYDERABAD MUNICIPAL CORPORATION, HYDERABAD. 5. IN THE RESULT, ASSESSEES APPEAL IS TREATED AS A LLOWED FOR STATISTICAL PURPOSES. ITA NO 314 OF 2018 SOLDIER SCHOL ARS STUDY CIRCLE HYDERABAD. PAGE 6 OF 6 ORDER PRONOUNCED IN THE OPEN COURT ON 17 TH AUGUST, 2018. SD/- SD/- (INTURI RAMA RAO) ACCOUNTANT MEMBER (P. MADHAVI DEVI) JUDICIAL MEMBER HYDERABAD, DATED 17 TH AUGUST, 2018. VINODAN/SPS COPY TO: 1 LAXMINIWAS & CO. C,A, D.NO.6-3-569, 4 TH FLOOR, OPP: RTA OFFICE, ABOVE BMW SHOWROOM, KHAIRATABAD, HYDERABAD 500082 2 ITO, WARD 6(3) HYDERABAD 3 CIT (A) - IV HYDERABAD 4 CIT III HYDERABAD 5 THE DR, ITAT HYDERABAD 6 GUARD FILE BY ORDER