Smt.Bahira Hakkim, Trivandrum V. The iTo,Wd-2(1), Trivandrum

ITA 338/COCH/2018

• Counselvise Citation: [2018] 123 COUNSELVISE.COM (IT) 8274 (ITAT-COCHIN)
• Duration Of Justice: 2 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-10-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2012-2013
• Appeal Filed On: 24-07-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A S BINDHU
• Assessee Lawyers: S RAJEEV
• Keywords: Cost of acquisition

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN BEFORE S/SHRI CHANDRA POOJARI, AM & GEORGE GEORGE K., JM I .T . A. NO. 338 / COCH/ 20 1 8 ASSESSMENT YEAR : 2012 - 13 SMT. BAHIRA HAKKIM, NEHA MANZIL, KURAKANNI, VARKALA, TRIVANDRUM. [PAN: AHWPH 4183N] VS. THE INCOME TAX OFFICER, WARD-1(2), TRIVANDRUM. (ASSESSEE - APPELLANT) (REVENUE - RESPONDENT) A SSESSEE BY SHRI S. RAJEEV, ADV. REVENUE BY SMT. A.S. BINDHU, DR D ATE OF HEARING 27/09/2018 DATE OF PRONOUNCEMENT 0 3 / 10 /2018 O R D E R PER CHANDRA POOJARI, AM: THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE CIT(A), TRIVANDRUM DATED 29/06/2018 AND PERTAINS TO THE ASSESSMENT YEAR 2012-13. 2. THE ASSESSEE HAS RAISED THE GROUND WITH REGARD TO DETERMINING THE VALUE OF PROPERTY SITUATED IN VARKALA MUNICPALITY AT RS.27,839/- PER CENT INSTEAD OF THE PREVAILING MARKET VALUE DURING THE YEAR 1998 AT RS.1,00,000/-. IT WAS CLAIMED THAT THE PROPERTY IN 1988 WAS ACQUIRED AS PER SETTLEMENT WITHIN THE FAMILY AND THERE HAD BEEN NO AGREEMENT OF SALE ON THAT PERIOD. THE VALUE FIXED BY THE I.T.A. NO. 338/COCH/2018 2 LOWER AUTHORITIES AT RS.27,839/- HAVE NO NEXUS WITH THE PREVAILING RATE DURING 1998 AT RS.1,00,000/-. 3. THE FACTS OF THE CASE ARE THAT THE ASSESSEE ALONG WITH THREE OTHER PERSONS SOLD IMMOVABLE PROPERTY THEY HAVE HAD AT VARKALA FOR A CONSIDERATION OF RS.30,50,000/- OUT OF WHICH THE ASSESSEE HAD RECEIVED AN AMOUNT OF RS.7,62,500/- AS HER SHARE. IN THE ABSENCE OF RETURN FILED BY HER OFFERING INCOME ON ACCOUNT OF CAPITAL GAIN, THE ASSESSMENT GOT RE-OPENED AND SUBSEQUENTLY COMPLETED WHILE BRINGING TO TAX A SUM OF RS.5,05,890/- TOWARDS CAPITAL GAIN EARNED ON HER SHARE OF SALE PROCEEDS RECEIVED. WHILE WORKING OUT THE CAPITAL GAIN, THE ASSESSING OFFICER ADOPTED RS.27,839/- AS COST PER CENT FOR THE F.Y. 1998-99 THE YEAR IN WHICH THE PROPERTY WAS SOLD. THE ASSESSEE WANTED TO HAVE A MINIMUM OF RS.1,00,000/- PER CENT TO BE ADOPTED AS COST OF ACQUISITION. 4. ON APPEAL, THE CIT(A) CONFIRMED THE FINDINGS OF THE ASSESSING OFFICER BY OBSERVING THAT COST OF ACQUISITION AT RS.1,00,000/- PER CENT CANNOT BE CONSIDERED BY RELYING ON THE PROPERTIES WHICH WERE SOLD IN THE YEAR 2010 ON THE REASON THAT THE PROPERTIES WHICH WERE SOLD IN THE YEAR 2010 WOULD HAVE FETCHED HIGHER SALE PRICE THAN THE AMOUNT WHICH WAS ACTUALLY SPENT FOR PURCHASING THE SAME. ACCORDING TO THE CIT(A), THE INSTANCES OF SALES WHICH TOOK PLACE IN THE YEAR 2010 WOULD NOT COME TO ASSESSEES RESCUE UNLESS DOCUMENTS WERE BROUGHT ON RECORD SO AS TO ESTABLISH THE FACT THAT THE PROPERTIES WERE PURCHASED BY THE PERSONS I.T.A. NO. 338/COCH/2018 3 CONCERNED FOR A SUM OF RS. 1,00,000/- PER CENT. THE CIT(A) OBSERVED THAT INSTEAD OF RELYING ON SOME OTHER INSTANCES OF SALES, THE ASSESSEE COULD HAVE PRODUCED THE PURCHASE AGREEMENT WHICH HE SIGNED WHEN THE PROPERTY WAS PURCHASED IN THE YEAR 1998-99. IN THE ABSENCE OF THE PRODUCING THE SAME, THE CIT(A) CONFIRMED THE COST OF ACQUISITION OF RS.27,839/- PER CENT ADOPTED BY THE ASSESSING OFFICER AND DISMISSED THE APPEAL. 5. THE LD. AR SUBMITTED THAT THE ASSESSING AUTHORITY FIXED THE PURCHASE COST OF LAND AT RS.27,839/- PER CENT ON THE BASIS OF VALUE FIXED BY THE HONBLE SUB COURT, ATTINGAL IN APPEAL CASE OF COMPARATIVE CASE IN L.A.R. NO. 96/1999 TO THE EXTENT OF 13 CENTS WHEREIN VALUE WAS FIXED AT RS.3,61,913/- AND INTEREST AT 12% TO THE TUNE OF RS.99,828/- AND 30% SOLECISM THEREON AND THEREBY VALUE COMES TO RS.6,00,263/- I.E. RS.46,174/- PER CENT. HOWEVER, IT WAS SUBMITTED THAT THE ASSESSING OFFICER CONSIDERED ONLY THE VALUE AT RS.3,61,913/- FOR PURCHASE COST WHICH COMES TO RS.27,839/- PER CENT. THE VALUE PER CENT SHOULD HAVE TAKEN AT RS.46,174/- INSTEAD OF RS.27,839/-. THE LD. AR SUBMITTED THAT THE AUTHORITIES BELOW HAVE NOT CONSIDERED THE FINDINGS OF THE JUDICIAL COURT WHILE ESTIMATING THE PURCHASE VALUE INCLUDING THE REPLY FILED ON 26/12/2012 TO NOTICE U/S. 148. IT WAS SUBMITTED THAT THE SOLECISM AS WELL AS INTEREST THEREON FORMS PART OF VALUE WHICH WAS NOT CONSIDERED BY THE LOWER AUTHORITIES. FURTHER, IT WAS SUBMITTED THAT THE CIT(A) HAD ALSO NOT CONSIDERED THE COST OF ACQUISITION OF TWO IDENTICAL PROPERTIES I.T.A. NO. 338/COCH/2018 4 SITUATED WITHIN KM SOLD DURING 2010 WHICH FETCHED HIGHER SALE VALUE ABOVE @R.2,00,000- PER CENT AT THE TIME OF PURCHASE. 6. THE LD. DR RELIED ON THE ORDER OF THE CIT(A) 7. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RECORD. THE MAIN PLEA OF THE ASSESSEES COUNSEL IS THAT THE VALUE FIXED BY THE HONBLE SUB COURT, ATTINGAL IN RESPECT OF COMPARATIVE CASE IN L.A.R. NO. 96/1999 TO THE EXTENT OF 13 CENTS IS TO BE CONSIDERED ALONGWITH INTEREST AND SOLECISM AS IT FORMS PART OF THE VALUE OF LAND. WE ARE NOT IN AGREEMENT WITH THE ABOVE PROPOSITION OF THE LD. AR. IT DOES NOT INDICATE THE CORRECT VALUE OF THE IMPUGNED LAND AS IN THE YEAR 1998 SINCE INTEREST AND SOLECISM CANNOT BE CONSIDERED AS PART OF THE VALUE OF THE LAND. HOWEVER, IN OUR OPINION, THE ASSESSING OFFICER HAS NOT BROUGHT ON RECORD ANY COMPARABLE SALE INSTANCES IN THE SAME LOCALITY IN THE YEAR 1998. HENCE, WE DIRECT THE ASSESSING OFFICER TO BRING ON RECORD COMPARABLE SALE INSTANCES IN THE YEAR IN 1998 IN WHICH THE ASSESSEE ACQUIRED THE SAID LAND BY SETTLEMENT. ACCORDINGLY, WE REMIT THIS ISSUE TO THE FILE OF THE ASSESSING OFFICER TO DETERMINE THE COST OF ACQUISITION OF THE LAND AS PREVAILING IN THE YEAR 1998. HENCE, THIS GROUND OF APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. I.T.A. NO. 338/COCH/2018 5 8. IN THE RESULT, THE APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 3 RD OCTOBER, 2018. SD/- SD/- (GEORGE GEORGE K.) (CHANDRA POOJARI) JUDICIAL MEMBER ACCOUNTANT MEMBER PLACE: KOCHI DATED: 3 RD OCTOBER, 2018 GJ COPY TO: 1. SMT. BAHIRA HAKKIM, NEHA MANZIL, KURAKANNI, VARKALA, TRIVANDRUM. 2. THE INCOME TAX OFFICER, WARD- 1(2), TRIVANDRUM. 3. THE COMMISSIONER OF INCOME-TAX(APPEALS), TRIVANDRUM. 4. THE PR. COMMISSIONER OF INCOME-TAX, TRIVANDRUM. 5. D.R., I.T.A.T., COCHIN BENCH, COCHIN. 6. GUARD FILE. BY ORDER (ASSISTANT REGISTRAR) I.T.A.T., COCHIN