Smt. Urmila Rani, Moga V. The Deputy Commissioner of Income tax, Moga

ITA 33/ASR/2011

• Counselvise Citation: 3320914 RSA 2011
• Duration Of Justice: 1 year(s) 7 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-09-2012
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Next Hearing Date: 09-07-2012
• Assessment Year: 2006-2007
• Appeal Filed On: 28-01-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Sale consideration of property below Jantri Value; Fair market value
• Section: 50C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR. BEFORE SH. H.S. SIDHU, JUDICIAL MEMBER AND SH. B.P.JAIN, ACCOUNTANT MEMBER I.T.A. NO.33(ASR)/2011 ASSESSMENT YEAR:2006-07 PAN :ACQPR7460R SMT. URMILA RANI VS. THE DY. COMMR. OF INCOME-TAX , C/O SH. VED PARKASH, MOGA CIRCLE, MOGA. MOGA. (APPELLANT) (RESPONDENT) APPELLANT BY:SH. SANDEEP VIJH CA RESPONDENT BY:SH. TARSEM LAL, DR DATE OF HEARING:13/09/2012 DATE OF PRONOUNCEMENT:18/09/2012 ORDER PER BENCH ; THE ASSESSEE HAS FILED THE PRESENT APPEAL AGAINST THE IMPUGNED ORDER OF CIT(A)-II, LUDHIANA, DATED 23.11.2010 FOR THE AS SESSMENT YEAR 2006-07 ON THE FOLLOWING GROUNDS: 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF T HE CASE THE LD. CIT(A) HAS ERRED IN UPHOLDING THE ADDITION OF RS.9, 98,363/- IN RESPECT OF LONG TERM CAPITAL GAIN/SHORT TERM CAPITA L GAIN MADE BY RESORTING TO SECTION 50C IN RESPECT OF THE FOLLOWING PROPERTIES: A. SHOP NO.1 RS.4,36,000/- (LT(G) B. SHOP NO.2 RS.3,80,450/- (LT(G) ITA NO.33(ASR)2011 2 C. PLOT AT GANDHI ROAD, RS. 70,911 (ST(G) 1A. THE LD. CIT(A) HAS FAILED TO APPRECIATE THAT TH E STAMP DUTY RATES HAVING BEEN OBJECTED DURING ASSESSMENT PROCE EDINGS, THE DETERMINATION OF FAIR MARKET VALUE SHOULD HAVE BEEN REFERRED TO THE VALUATION OFFICER. THE SUBMISSIONS MADE ON THE ISSUE OF THE WRONG COMPUTATION OF CAPITAL GAIN HAVE NOT BEEN AP PRECIATED. 2A THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE THE LD. CIT(A) HAS ERRED IN UPHOLDING THE DISALLOWANCE OF C OST OF IMPROVEMENT TO THE PROPERTIES FOR COMPUTING CAPITAL GAIN. THE FACTUAL POSITION AS HIGHLIGHTED HAS ALSO NOT BEEN A PPRECIATED. 2. THE FACTS NARRATED BY THE REVENUE AUTHORITIES AR E NOT DISPUTED BY BOTH THE PARTIES. THEREFORE, THERE IS NO NEED TO RE PEAT THE SAME FOR THE SAKE OF CONVENIENCE. 3. AT THE TIME OF HEARING, THE LD. COUNSEL FOR THE ASSESSEE, STATED THAT THE LD. FIRST APPELLATE AUTHORITY HAS WRONGLY UPHELD TH E ADDITIONS IN DISPUTE WITHOUT CONSIDERING THE REAL FACTS AND RECORD AVAIL ABLE WITH THE ASSESSING OFFICER AS WELL AS BEFORE HIM. HE FURTHER STATED TH AT THE ASSESSEE HAS RAISED OBJECTION BEFORE THE AO TO REFER THE MATTER TO THE VALUATION OFFICER BY STATING THAT SHE HAS TRULY DECLARED THE VALUE OF TW O SHOPS ACCORDING TO THE REGISTRATION DEEDS AND THE PROPERTY IN QUESTION HAS BEEN SOLD AT THE PREVAILING MARKET RATES. HE POINTED OUT THAT THE C OLLECTOR RATES OF THE PROPERTY FIXED FOR THE PURPOSE OF STAMP PAPERS IS Q UITE EXCESSIVE AND THE VALUED ADOPTED BY THE STAMP DUTY AUTHORITY IS MUCH MORE THAN THE FAIR MARKET VALUE OF THE PROPERTY. HE STATED THAT IN THE SE CIRCUMSTANCES, THE AO ITA NO.33(ASR)2011 3 SHOULD HAVE REFERRED THE MATTER TO THE VALUATION OF FICER IN VIEW OF SECTION 50C OF THE INCOME-TAX ACT, 1961, WHICH HAS NOT BEEN DONE BY THE AO AS WELL AS HAS ALSO NOT BEEN APPRECIATED BY THE LD. CI T(A) IN THE IMPUGNED ORDER. HE FURTHER STATED THAT THE LD. FIRST APPELLA TE AUTHORITY HAS ALSO NOT ADJUDICATED THE ISSUE RAISED IN GROUND 2(A) REGARDI NG DISALLOWANCE OF COST OF IMPROVEMENT TO THE PROPERTIES FOR COMPUTATION OF CA PITAL GAIN. LASTLY, HE REQUESTED THAT THE ISSUE IN DISPUTE BE SENT BACK TO THE FILE OF THE ASSESSING OFFICER TO REFER THE MATTER TO THE VALUATION OFFICE R WITH THE DIRECTION TO DECIDE THE ISSUES IN DISPUTE AFTER RECEIVING REPORT FROM THE VALUATION OFFICER. 4. THE LD. DR, ON THE OTHER HAND, RELIED UPON THE O RDERS OF THE AUTHORITIES BELOW AND HAS ALSO FILED WRITTEN SUBMIS SIONS WHICH ARE PLACED ON RECORD. 5. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE M ATERIAL AVAILABLE ON RECORDS ESPECIALLY THE PROVISIONS OF SECTION 50C(2) OF THE I.T.ACT, 1961, INCLUDING THE WRITTEN SUBMISSIONS FILED BE THE LD. COUNSEL FOR THE ASSESSEE AND THE LD. DR. WE HAVE ALSO GONE THROUGH THE DEC ISIONS RELIED UPON BY THE LD. COUNSEL FOR THE ASSESSEE VIS. (I) N. MEENAK SHI VS. ACIT REPORTED AT 226 CTR 625 (MADRAS) AND (II) MANJULA SINGHAL VS. ITO REPORTED IN 141 TTJ 511 (ITAT JODHPUR). WE ARE NOT COMMENTING UPO N THE MERITS OF THE CASE BECAUSE IT WILL PREJUDICE TO THE MIND OF THE A .O. KEEPING IN VIEW THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE AS WELL AS RELEVANT PROVISIONS OF ITA NO.33(ASR)2011 4 SECTION 50C AND 50C(2) OF THE ACT, WE ARE OF THE CO NSIDERED OPINION THAT ONCE THE ASSESSEE HAS FILED THE OBJECTION LETTER WI TH REGARD TO THE PROVISIONS OF SECTION 50C OF THE ACT, AO SHOULD HAVE REFERRED THE MATTER TO THE D.V.O. THEREFORE, IN THE INTEREST OF JUSTICE, WE REMIT THE MATTER BACK TO THE FILE OF THE A.O. WITH THE DIRECTION TO REFER THE MATTER TO THE D.V.O. FOR PROPER VALUATION OF THE PROPERTY AND THEREAFTER DECIDE THE ISSUE IN DISPUTE AFRESH IN ACCORDANCE WITH LAW AFTER GIVING ADEQUATE OPPORTUNI TY TO THE ASSESSEE FOR SUBSTANTIATING HERE CLAIM. ACCORDINGLY, ALL THE GRO UNDS OF THE APPEAL OF THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. 6. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 18TH SEPTEMBER, 2012. SD/- SD/- (B.P. JAIN) (H.S. SIDHU) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 18TH SEPTEMBER, 2012 /SKR/ COPY OF THE ORDER FORWARDED TO: 1. THE ASSESSEE: SMT. URMILA RANI MOGA 2. THE DCIT CIRCLE MOGA, MOGA. 3. THE CIT(A) 4. THE CIT 5. THE SR DR, ITAT, AMRITSAR. TRUE COPY BY ORDER