DCIT 7(2), MUMBAI V. GUNNEBO INDIA LTD, THANE

ITA 3383/MUM/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 101107 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 4 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-09-2015
• Appeal Filed By: Department
• Bench Allotted: G
• Next Hearing Date: 14-07-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 02-05-2013
• Court: TRIBUNAL
• Department Lawyers: AGAINST PASSED
• Keywords: Sale consideration of property below Jantri Value; Capital asset; Business income; Depreciation; Principle of natural justice; Speculation loss; Valuation report; Assessment record; Unabsorbed depreciation
• Section: 143(3); 50C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH G MUMBAI. BEFORE SHRI AMIT SHUKLA, JUDICIAL MEMBER AND SHRI RAMIT KOCHAR, ACCOUNTANT MEMBER ITA NO 3383 /MUM/201 3 ASSESSMENT YEAR: - 2008 - 09. DEPUTY COMMISSIONER OF INCOME TAX - 7(2), ROOM NO. 624, M.K. ROAD, MUMBAI 400 020. V. M/S GUNNEBO INDIA LTD. UNIT NO. 102, 1 ST FLOOR, AKRUTI SMC LBS MARG, KHOPAT, THANE (W) 400 601. PAN/GIR NO. AAE CS7236D APPELLANT RESPONDENT ORDER PER RAMIT KOCHAR, A CCOUNTANT M EMBER 1. THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER PASSED BY C OMMISSIONER OF I NCOME T AX (A PPEAL S ) (HEREINAFTER CALLED THE CIT(A)) DATED 25 TH FEBRUARY 2013 FO R ASSESSMENT YEAR 200 8 - 0 9 . THE REVENUE HAS RAISED THE FOLLOWING GROUND S OF APPEAL: - REVENUE BY SHRI VI K ASH KR. AGARWAL ASSESSEE BY SHRI JIGER SAIYA DATE OF HEARING 12 .08.2015 DATE OF PRONOUNCEMENT 24 .0 9 .2015 2 ITA NO 3383/MUM/2013 ASSESSMENT YEAR: - 2008 - 09. . PAGE 2 OF 23 THE LEARNED CIT(A) HAS ERRED ON FACTS AND IN LAW IN DIRECTING THE ASSESSING OFFICER TO ALLOW SET OFF UNABSORBED DEPRECIATI ON OF PRIOR AMOUNTING TO RS. 6,01,66,399/ - AGAINST LONG TERM CAPITAL GAIN WITHOUT PROPERLY APPRECIATING THE FACTUAL AND LEGAL MATRIX AS CLEARLY BROUGHT OUT BY THE ASSESSING OFFICER. (II) THE LEARNED CIT (A) HAS ERRED ON FACTS AND IN LAW IN NOT APPRECIATI NG THE FACT THAT THE ASSESSING OFFICER HAS REJECTED THE CLAIM OF SET OFF OF UNABSORBED DEPRECIATION AND BUSINESS LOSS AS IT IS NOT ALLOWABLE AS PER THE PROVISIONS OF THE INCOME TAX ACT. (III) THE LEARNED CIT (A) HAS ERRED ON FACTS AND IN LAW IN DIRECTING THE ASSESSING OFFICER TO ADOPT CONSIDERATION OF RS. 9,37,30,000/ - FOR COMPUTING THE LONG TERM CAPITAL GAIN AS AGAINST STAMP DUTY VALUATION OF RS. 3.80 CR. WITHOUT PROPERLY APPRECIATING T HE FACTUAL AND LEGAL MATRIX AS CLEARLY BROUGHT OUT BY THE ASSESSING OFFICER. (IV) THE LEARNED CIT (A) HAS ERRED ON FACTS AND IN LAW IN NOT APPRECIATING THE FACT THAT THE ASSESSEE HAS ALLOCATED HIGHER CONSIDERATION FOR COMPUTATION OF LONG TERM CAPITAL GAI N ON SALE OF LAND AND ALLOCATED SMALLER CONSIDERATION FOR COMPUTATION OF SHORT TERM CAPITAL GAIN ON SALE OF BUILDING WITH THE INTENTION TO REDUCE THE TAX LIABILITY. (V) THE LEARNED CIT (A) HAS ERRED ON FACTS AND IN LAW IN DELETING THE ADDITION OF RS. 58, 18,028/ - ON ACCOUNT OF SHORT TERM CAPITAL GAIN ON SALE OF BUILDING WITHOUT PROPERLY APPRECIATING THE FACTUAL AND LEGAL MATRIX AS CLEARLY BROUGHT OUT BY THE ASSESSING OFFICER. (VI) THE LEARNED CIT (A) HAS ERRED ON FACTS AND IN LAW IN DIRECTING THE ASSESS ING OFFICER TO CONSIDER THE VALUE OF BLOCK OF BUILDING AT RS. 1,16,29,213/ - INSTEAD OF RS. 1,14,41,700/ - AS ADOPTED BY THE ASSESSING OFFICER WITHOUT PROPERLY APPRECIATING THE FACTUAL AND LEGAL MATRIX AS CLEARLY BROUGHT OUT BY THE ASSESSING OFFICER . (VII) THE LD. CIT(A)S ORDER IS CONTRARY IN LAW AND ON FACT AND DESERVES TO BE SET ASIDE. 2. WE FIRST DEAL WITH T HE ISSUE RAISED IN GROUND NO. ( III ) & ( IV ) IN THE MEMO OF APPEAL FILED BY THE REVENUE. 3 ITA NO 3383/MUM/2013 ASSESSMENT YEAR: - 2008 - 09. . PAGE 3 OF 23 3. FACTS IN BRIEF ARE THAT THE ASSESSEE COMPANY IS ENGAGE D IN THE BUSINESS OF MANUFACTURING AND TRADING OF PHYSICAL SECURITY AND FIRE FIGHTING EQUIPMENT AND UNDERTAKING OF PROJECT FOR INSTALLATION AND MAINTENANCE OF SECURITY EQUIPMENTS. IT FILED ITS RETURN OF INCOME ON 30.09.2008 DECLARING TOTAL INCOME OF RS. 2,42,33,290/ - . DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE A SSESSING O FFICER FOUND THAT THE ASSESSEE COMPANY HAS SOLD A PRO PERTY AT PLOT NO. 99(NP), AMBATTUR INDUSTRIAL ESTATE, CHENNAI - 600098 ALONG WITH BUILDINGS AND PREMISES TO ONE M/S VASAN PUBLICATIONS PVT LTD. FOR A TOTAL CONSIDERATION OF RS. 10 CRORE S . THE ASSESSEE COMPANY WHILE WORKING OUT THE CAPITAL GAINS ON THE SALE O F AMBATTUR PROPERTY IN THE RETURN OF INCOME FILED WITH REVENUE , HAS TAKEN THE CONSIDER ATION RECEIVED FOR LAND AT RS.937.30 LACS AN D THAT FOR BUILDING AT RS.62.70 LACS. THE ASSESSEE COMPANY HAS OFFERED FOR TAXATION RS. 928 LACS AS LONG TERM CAPITAL GAINS ON S ALE OF LAND AT AMBATTUR AND HAS REDUCED RS.62.70 LACS FROM THE WDV OF THE BLOCK OF ASSETS COMPRISING BUILDING . HOWEVER, ON VERIFICATION OF THE SALE DEED WITH RESPECT TO SALE OF AMBATTUR PROPERTY , IT WAS FOUND BY THE ASSESSING OFFICER THAT IN ANNEXURE 1A OF THE SALE DEED DATED 25.06.2007, THE SALE CONSIDERATION FOR THE AMBATTUR LAND HAS BEEN REFLECTED AT RS. 380 LACS AND THE SALE CONSIDERATION OF THE AMBATTUR BUILDING HAS BEEN REFLECTED AT RS. 620 LACS . THE ASSESSEE COMPANY WAS ASKED TO SHOW - CAUSE AS TO WHY THE VALUES ADOPTED IN THE SALE DEED DATED 25 TH JUNE 2007 OF AMBATTUR PROPERTY FOR THE LAND AND BUILDING SEPARATELY BE NOT TAKEN FOR WORKING OUT THE CAPITAL GAINS AND PAYMENT OF TAXES BE 4 ITA NO 3383/MUM/2013 ASSESSMENT YEAR: - 2008 - 09. . PAGE 4 OF 23 COMPUTED ACCORDINGLY . THE ASSESSEE COMPANY SUBMITTED BEFORE THE ASSESSING OFFICER THAT THE VALUATION OF BUILDING IS NOT DONE ON ANY SCIENTIFIC BASIS AND WITHOUT ANY INSPECTION OF THE BUILDING. THE VALUATION IS AD - HOC AND TO FILL UP FOR THE DIFFERENCE BETWEEN THE CONSIDERATION RECEIVED AND THE VALUE OF LAND A S PER READY R ECKONER RA TES . THE ASSESSEE COMPANY REQUESTED THAT THE SALE CONSIDERATION OF LAND SHOULD BE TAKEN AT RS. 937.30 LACS & THE SALE CONSIDERATIO N OF BUILDING SHOULD BE TAKEN AT RS.62.70 LACS OF THE AMBATTUR PROPERTY WHICH WAS SOLD FOR A TOTAL CON SIDERATION OF RS 10 CRORES AS PER SALE DEED DATED 25 TH JUNE 2007. THE A SSESSING O FFICER HELD THAT THE ASSESSEE COMPANY ITSELF HAS SIGNED THE SALE DEED DATED 25 TH JUNE 2007 AND THE SAID ANNEXURE 1A IS AN INTEGRAL PART OF THE SALE DEED DATED 25 TH JUNE 2007 WHICH HAS BEEN REGISTERED ALONG WITH THE SALE DEED WITH RESPECT TO SALE OF AMBATTUR PROPERTY WHEREBY VALUE OF LAND IS SHOWN AT RS 380 LACS WHILE VALUE OF BUILDING IS SHOWN AT RS.620 LACS . THE CONTENTION OF THE ASSESSEE COMPANY DID NOT FIND FAVOUR WITH THE ASSESSING OFFICER AND THUS, THE ASSESSING OFFICER ADOPTED THE VALUE IN THE SALE DEED FOR THE LAND AT RS. 380 LACS AND FOR THE BUILDING AT RS . 620 LACS WITH RESPECT TO SALE OF AMBATTUR PROPERTY FOR COMPUTATION OF CAPITAL GAIN. 4. AGGRIEVED BY THE ORDER OF THE ASSESSING OFFICER , THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE CIT(A). THE ASSESSEE SUBMITTED BEFORE THE CIT(A), THE VALUATION REPORT DATED 24.02.2007 OF GOVERNMENT REGISTERED VALUER WITH RESPECT TO VALUATION OF AMBATTUR 5 ITA NO 3383/MUM/2013 ASSESSMENT YEAR: - 2008 - 09. . PAGE 5 OF 23 PROPERTY COMPRISING OF BO TH LAND AND BUILDING THEREOF AND BASED UPON THAT ASSESSEE ALLOCATED THE CONSIDERATION OF RS. 937.30 LACS TOWARDS LAND AND BALANCE RS. 62.70 LACS TOWARDS BUILDING. THE ASSESSEE COMPANY SUBMITTED THAT THE GOVERNMENT R EGISTERED VALUER HAS ARRIVED AT THE VALUE OF THE PROPERTY AFTER DOING EXTENSIVE SURVEY OF THE PROPERTY AND THE RELATED FACTORS. THE ASSESSEE SUBMITTED THAT IT HAS ENTERED INTO SALE DEED DATED 25.6.2007 FOR LUMP SUM CONSIDERATION OF RS. 10 CRORE S . THE ASSE S SEE SUBMITTED THAT THE VALUE OF LAND FOR SALE DEED PURPOSES WAS ARRIVED AT ON THE BASIS OF CIRCLE STAMP DUTY RATES AS PER R EADY R ECKONER RATES AND , THEREAFTER, THE BALANCE AMOUNT WAS ATTRIBUTED TO BUILDING. THE ASSESSEE ALSO SUBMITTED THAT THE ASSESSING O FFICER HAS IGNORED THE VALUATION REPORT ISSUE D BY THE GOVERNMENT REGISTERED V ALUER AND VALUED THE PROPERTY BASED ON THE CLASSIFICATION MADE IN ANNEXURE - 1(A) AND TAXED THE CAPITAL GAIN BASED ON THE VALUE OF LAND AT RS. 380 LACS AND BUILDING AT RS. 620 LACS . THE CIT(A) HELD THAT IN THE SALE DEED DATED 25 TH JUNE 2007 UNDER WHICH BOTH THE LAND AND BUILDING AT AMBATTUR HAS BEEN SOLD AT RS. 10 CRORE S AND THERE IS NO BIFURCATION OF SALE CONSIDERATION OF LAND & BUILDING IN THE SAID SALE DEED FOR SALE OF AMBATTUR PROPERTY AND THE ASSESSING OFFICER HAS PROCEEDED ON INCORRECT FACTS THAT THE SALE DEED SHOWS SALE VALUE OF LAND AT RS. 380 LACS AND BUILDING AT RS. 620 LACS . THE CIT(A) HELD THAT ANNEXURE - 1A WHICH WAS ENCLOSED TO THE SALE DEED DATED 25 TH JUNE 2007 , WAS PRE PARED ON THE BASIS OF CIRCLE RATE 6 ITA NO 3383/MUM/2013 ASSESSMENT YEAR: - 2008 - 09. . PAGE 6 OF 23 I.E. STAMP DUTY AUTHORITIES RATES AGAINST WHICH THE VALUE OF LAND WAS TAKEN AS PER CIRCLE RATE AND THE BALANCE IS ATTRIBUTED TO BUILDING ON AD - HOC BASIS. THE CIT(A) HELD THAT AS PER PROVISION S OF SECTION 50C OF THE ACT , W HERE THE SALE CONSIDERATION RECEIVED OR ACCRUING AS A RESULT OF TRANSFER OF CAPITAL ASSET BEING LAND AND BUILDING BOTH IS DIFFERENT THAN THE VALUE ADOPTED OR ASSESSED BY STAMP DUTY VALUE , THE VALUE WHICHEVER IS HIGHER IS TO BE ADOPTED FOR THE PURPOSE OF COMPUTATION OF CAPITAL GAIN. THE STAMP DUTY VALUE OF THE LAND AT RS. 380 LACS AND THE VALUE COMPUTED BY THE ASSESSEE COMPANY AT RS. 937.30 LACS BASED ON THE REPORT OF GOVERNMENT REGISTERED VALUER WHICHEVER IS HIGHER IS TO BE ADOPTED AND HENCE , THE ASSESSEE COMPANY HAS RIGHTLY ADOPTED VALUE OF RS. 937.30 LACS AS TOWARDS THE SALE CONSIDERATION FOR THE LAND. THE CIT(A) ALSO HELD THAT THE ASSESSEE COMPANY HAS ADOPTED RS. 380 LACS AS VALUE FOR LAND IN SALE DEED BASED ON STAMP DUTY CIRCLE RATE AND TO FILL THE GAP , THE BALANCE OF RS. 620 LACS WAS ASSIGNED TOWARDS BUILDING ON AD - HOC BASIS. THE CIT(A) ALSO HELD THAT BASED ON THE VALUATION ARRIVED AT BY THE GOVERNMENT REGISTERED VALUER , THE VALUE OF THE BUILDING COMES TO RS. 62.70 LACS. THE CIT(A) HELD T HAT AS PER ASSESSMENT RECORDS, THE BUILDING WAS APPROXIMATELY 18 YEARS OLD AND THE OPENING WDV OF SUCH BUILDING AT AMBATTUR IN THE ASSESSMENT YEAR 2008 - 0 9 HAD BEEN SHOWN AT RS. 98,60,09 0/ - AND THERE IS FURTHER ADDITIONS DURING THE YEAR AT RS. 4,37,705/ - FOR MORE THAN 180 DAYS AND AT RS. 11,43,905/ - FOR LESS THAN 180 DAYS IN THE SAID BUILDING . THE CIT(A) , THEREFORE, HELD THAT THE VALUE OF LAND ALWAYS APPRECIATE WHEREAS THE VALUE OF BUILDING ALWAYS DEPRECIATE AND HELD THAT VALUE OF 7 ITA NO 3383/MUM/2013 ASSESSMENT YEAR: - 2008 - 09. . PAGE 7 OF 23 BUILDING CANNOT BE RS.6 20 LACS BY ANY STRETCH OF IMAGINATION AND HENCE IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE CIT(A) HELD THAT THE VALUE OF SALE CONSIDERATION OF THE BUILDING SHOULD BE 62.70 LACS WHILE THE VALUE OF LAND AT AMBATTUR SHOULD BE RS.937.30 LACS AS SHOWN BY T HE ASSESSEE COMPANY ON THE BASIS OF REGISTERED VALUER R EPORT, AND THUS THE CIT(A) UPHELD THE CLAIM OF ASSESSEE COMPANY . 5. AGGRIEVED BY THE ORDER OF CIT(A), THE REVENUE IS IN APPEAL BEFORE US. 6. BEFORE US, THE LD. DR CONTENDED THAT THE ASSESSING OFFICE R HAS RIGHTLY HELD THAT THE SALE CONSIDERATION OF THE LAND SHOULD BE RS. 3.80 CRORES WHICH IS ADMITTED BY THE ASSESSEE COMPANY IN THE ANNEXURE 1A ATTACHED TO THE SALE DEED DATED 25.06.2007 WITH RESPECT TO SALE OF AMBATTUR PROPERTY , WHEREBY, THE ASSESSEE COMPANY AS WELL AS THE BUYER HAS DULY SIGNED AND ANNEXED THE SAID ANNEXURE - 1A TO THE SALE DEED, WHEREBY THE VALUE OF LAND IS SHOWN AT RS. 380 LACS AND THE VALUE OF BUILDING IS SHOWN AT RS. 620 LACS TO MAKE THE TOTAL AT RS. 10 CRORE S . HE, THEREFORE POINTE D OUT THAT THE ASSESSEE COMPANY HAS ADMITTED TO MARKET VALUE OF LAND AT RS. 380 LACS BY DRAWING OUR ATTENTION TO ANNEXURE 1A TO SALE DEED DATED 25 TH JUNE 2007 WHEREBY IT IS MENTIONED THAT THE AFORE - STATED VALUE OF RS 380 LACS IS THE MARKET VALUE OF THE AMBATTUR LAND AND THE SAID ANNEXURE1A IS PART AND PARCEL OF THE SALE DEED DATED 25 TH JUNE 2007 . HE ALSO POINTED OUT THAT THE ASSESSEE COMPANY HAS NOT PRODUCED THE GOVERNMENT 8 ITA NO 3383/MUM/2013 ASSESSMENT YEAR: - 2008 - 09. . PAGE 8 OF 23 REGISTERED VALUER R EPORT DATED 24 TH FEBRUARY 2007 WITH RESPECT TO AMBATTUR PROPERTY OWNED BY THE ASSESSEE COMPANY BEFORE THE ASSESSING OFFICER DURING ASSESSMENT PROCEEDINGS BUT THE SAME IS PRODUCED BEFORE THE CIT(A) FOR THE FIRST TIME . LD DR ALSO POINTED OUT THAT THE CIT(A) ERRED IN NOT SENDING THE SAID VALUATION REPORT DATED 24 TH FEBRUARY 2007 ISSUED BY GOVERNMENT REGISTERED VALUER TO THE ASSESSING OFFICER FOR REMAND REPORT AND HENCE PRINCIPLES OF NATURAL JUSTICE ARE NOT COMPLIED WITH BY CIT(A) AS THE ASSESSING OFFICER IS DEPRIVED OF VERIFYING THE SAID VALUATION REPORT . THE LD. DR ALSO CONTENDED THAT THE ASSESSING OFFICER HAS NOT BEEN GIVEN OPPORTUNITY TO REBUT THE SAID VALUATION REPORT DATED 24 TH FEBRUARY 2007 AND HENCE ORDERS OF CIT(A) IS VITIATED TO THAT EXTENT. 7. THE ASSESSEE COMPANY ON THE OTHER HAND, POINTED OUT THAT THE VALUATION REPORT BY GOVERNMENTS REGISTERED VALUER HAS BEEN SUBMITTED BEFORE THE CIT(A) AS WELL BEFORE THE ASSESSING OFFICER. T HE SAID VALUER HAS DULY VALUED THE PROPERTY AFTER BRINGING ALL THE FACTS AND COMPARABLE & HAS RIGHTLY VALUED THE PROPERTY AT RS. 11.30 CRORES. THE ASSESSEE COMPANY ALSO STATED THAT THE SAID VALUER HAS DULY VISITED AND INVESTIGATED THE SITE AND HAS GIV EN TH E VALUATION REPORT DATED 24.02 .2007. THE ASSESSEE COMPANY HAS SOLD THE COMPLETE BUILDING AND LAND FOR RS. 10 CRORE S AND HAS ALLOCATED THE PROPORTION OF LAND AND BUILDING BASED UPON THE VALUATION REPORT SUBMITTED BY THE GOVERNMENT REGISTERED VALUER AND BASE D UPON THE SAID VALUATION REPORT, THE ASSESSEE COMPANY HAS OFFERED CAPITAL GAIN FOR TAXATION. 9 ITA NO 3383/MUM/2013 ASSESSMENT YEAR: - 2008 - 09. . PAGE 9 OF 23 THE ASSESSEE COMPANY SUBMITTED THAT THE REGISTERED VALUER HAS ARRIVED AT THE VALUE OF THE PROPERTY AFTER DOING EXTENSIVE SURVEY OF THE PROPERTY AND THE RELATED FACTORS. THE ASSESSEE COMPANY SUBMITTED THAT IT HAS ENTERED INTO SALE DEED DATED 25.6.2007 FOR LUMP SUM CONSIDERATION OF RS. 10 CRORE WITH RESPECT OF SALE OF AMBATTUR PROPERTY . THE ASSESSEE COMPANY SUBMITTED THAT THE VALUE OF LAND FOR SALE DEED PURPOSES WA S ARRIVED AT ON THE BASIS OF CIRCL E STAMP DUTY RATES AS PER READY R ECKONER RATES AND , THEREAFTER, THE BALANCE AMOUNT WAS ATTRIBUTED TO BUILDING. THE ASSESSEE COMPANY ALSO SUBMITTED THAT THE ASSESSING OFFICER HAS IGNORED THE VALUATION REPORT ISSUED BY THE GOVERNMENT REGISTERED VALUER AND VALUED THE PROPERTY BASED ON THE CLASSIFICATION MADE IN ANNEXURE - 1(A) AND TAXED THE CAPITAL GAIN ON LAND BY CONSIDERING THE SALE CONSIDERATION AT RS. 380 LACS AND BUILDING AT RS. 620 LACS . THE ASSESSEE COMPANY ALSO SUBMIT TED THAT THE WDV VALUE OF BLOCK OF ASSET COMPRISING B UILDING AS PER BOOKS OF ACCOUNTS IS RS. 1,14,41,700 / - AND THE BUILDING BEING A DEPRECIABLE ASSET CANNOT BE SOLD BY ANY STRETCH OF IMAGINATION FOR RS. 620 LACS AS AGAINST WDV OF RS 114.42 LACS AND HENCE TH E ASSESSEE COMPANY CONTENDED THAT IT HAS RIGHTLY OFFERED FOR TAXATION, THE CAPITAL GAIN ON THE SALE OF THIS PROPERTY AT AMBATTUR AS PER INCOME TAX RETURN FILED WITH REVENUE WHEREBY VALUE OF LAND IS ADOPTED AT RS.937.30 LACS WHILE VALUE OF BUILDING IS ADOPT ED AT RS 62.70 LACS . THE ASSESSEE COMPANY RELIED UPON THE ORDERS OF THE CIT(A). 10 ITA NO 3383/MUM/2013 ASSESSMENT YEAR: - 2008 - 09. . PAGE 10 OF 23 8. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND CAREFULLY PERUSED THE RELEVANT MATERIAL ON RECORD. BEFORE WE START, WE WOULD LIKE TO MENTION THAT THE CONCEPT OF CIRCLE RATE /RE ADY RECKONER RETES WAS INTRODUCED BY THE GOVERNMENT AS A MEASURE TO COLLECT STAMP DUTY WHICH IS COMPUTED ON THESE RATES OR ON THE ACTUAL CONSIDERATION OF THE TRANSACTED PROPERTY BEING REGISTERED BY THE SUB - REGISTRAR , WHICH EVER IS HIGHER . THE TWIN PURPOSE OF THE CIRCLE RATE IS THAT GOVERNMENT WANTS TO ENSURE THAT THE PROPERTY IS REGISTERED AT A VALUE WHICH IS IN CLOSE PROXIMITY TO THE MARKET VALUE OF THE PROPERTY IN ORDER TO COLLECT CORRECT REVENUE FROM STAMP DUTY AS A REVENUE GENERATING MEASURE AN D ALSO SECONDLY TO PREVENT CIRCULATION OF BLACK MONEY IN THE ECONOMY AS IT IS WELL KNOWN FACT THAT THERE IS AN ON - MONEY INVOLVED IN SALE /PURCHASE OF THE PROPERTY TRANSACTIONS WHICH IS CREATING ECONOMIC HAVOC I N THE ECONOMY DUE TO UNDER DECLARATION OF THE VALUE OF THE PROPERTY BY THE PARTIES WRECKING THE BACK BONE OF INDIAN ECONOMY . THESE STAMP DUTY CIRCLE RATE S ARE ENHANCED BY GOVERNMENT FROM TIME TO TIME BASED ON THE MARKET VALUE OF PROPERTIES PREVAILING IN AN AREA FROM TIME TO TIME AS A REVENUE GENERATI NG MEASURE AS ALSO TO CURB CIRCULATION OF BLACK MONEY IN THE ECONOMY . WE HAVE OBSERVED THAT ASSESSEE COMPANY HAS ITSELF DECLARED THE MARKET VALUE OF THE LAND AT RS. 380 LACS IN THE SALE DEED DATED 25 TH JUNE 2007 WHICH IS ALSO SIGNED BY THE BUYER AND DULY REGISTERED WITH GOVERNMENT AUTHORITIES , THUS ON THE ONE HAND , THE ASSESSEE COMPANY BROUGHT ON RECORD WITH THE GOVERNMENT AUTHORITIES THAT THE VALUE OF 11 ITA NO 3383/MUM/2013 ASSESSMENT YEAR: - 2008 - 09. . PAGE 11 OF 23 THE AMBATTUR LAND FOR THE STAMP DUTY PURPOSE S IS RS. 380 LACS WHILE LATER ON THE ASSESSEE COMPANY IS TURNING AROUND AND CONTENDING THAT THE VALUE OF THE LAND AS PER ACTUAL MARKET VALUE SHOULD BE TAKEN RS. 937.30 LACS FOR COMPUTING LONG TERM CAPITAL GAIN . THE SAID DECLARATION OF VALUE OF LAND OF RS. 380 LACS TO GOVERNMENT REGISTERING AUTHORITY FOR STAMP DUT Y PURPOSES AT THE TIME OF REGISTRATION OF THE PROPERTY WILL NOT ONLY HAVE REPERCUSSIONS ON STAMP DUTY PAYABLE TO GOVERNMENT BUT AT THE SAME TIME THE GOVERNMENT IS DEPRIVED OF KNOWING THE EXACT CURRENT MARKET V ALUE OF THE LAND IN THE AREA WHICH THEN COULD HAVE BEEN THE BASIS FOR THE GOVERNMENT TO ENHANCE THE CIRCLE RATE OF THE AREA WHERE THE LAND IS LOCATED BASED ON THE ACTUAL CONSIDERATION OF THE TRANSACTED VALUE WHICH IS MORE THAN THE PREVAILING CIRCLE RATES . THE SECOND REPERCUSSION OF THE SAID DECLARAT IONS BY THE ASSESSEE COMPANY OF RS. 620 LACS AS THE VALUE OF BUILDING IN THE SALE DEED DATED 25 TH JUNE 2007 IS THAT IT HAS ENTITLED THE BUYER TO CLAIM DEPRECIATION ON BUILDING UNDER THE ACT ON THE PURCHASE VALUE OF RS. 620 LACS (LAND BEING NOT ENTITLED FOR DEPRECIATION UNDER THE ACT) AND NOW THE ASSESSEE COMPANY IS TURNING AROUND AND CONTENDING THAT THE CORRECT VALUE OF THE BUILDING FOR THE PURPOSE OF COMPUTATION OF CAPITAL GAIN SHOULD BE TAKEN TO BE RS 62.70 LACS. WHILE OFFERIN G FOR TAX IN THE RETURN OF INCOME FILED WITH REVENUE , THE ASSESSEE COMPANY HAS OFFERED THE SALE VALUE OF LAND AT RS. 937.30 LACS AND SALE VALUE OF RS. 62.70 LACS IS ATTRIBUTED FOR THE BUILDING BASED UPON THE VALUATION REPORT OF GOVERNMENT REGISTERED VALUER AS CLAIMED BY THE ASSESSEE COMPANY WITH RESPECT TO SALE OF AMBATTUR 12 ITA NO 3383/MUM/2013 ASSESSMENT YEAR: - 2008 - 09. . PAGE 12 OF 23 PROPERTY . THE ASSESSEE COMPANY IS CONTENDING THAT THE SAID GOVERNMENT REGISTERED VALUATION REPORT DATED 24 TH FEBRUARY 2007 WAS DULY PRODUCED BEFORE THE ASSESSING OFFICER WHILE W E HAVE OB SERVED THAT THERE IS NO MENTION O F THIS VALUATION REPORT DATED 24.02 .2007 IN THE ASSESSMENT ORDER DATED 31.12.2010 PASSED U/S 143(3) OF THE ACT BY THE ASSESSING OFFICER . THE REVENUE HAS ALSO DISPUTED THAT NO SUCH VALUATION REPORT DATED 24 TH FEBRUARY 2007 WAS SUBMITTED BEFORE ASSESSING OFFICER DURING ASSESSMENT PROCEEDINGS. THE CIT(A) HAS NOT FORWARDED THE SAID VALUATION REPORT TO THE ASSESSING OFFICER FOR REMAND REPORT AND NO OPPORTUNITY IS PROVIDED TO THE ASSESSING OFFICER TO REBUT THE SA ME . WE HAVE ALSO NOTED THAT IN THE SALE DEED DATED 25 TH JUNE 2007 EXECUTED BY THE ASSESSEE COMPANY WITH VASAN PUBLICATIONS PRIVATE LIMITED, IT IS CLEARLY MENTIONED THAT THE MARKET VALUE OF LAND IS RS 380 LACS AS ON THE DATE OF SALE. IT WILL BE FAIR ON OUR PART , AND ALSO IN THE INTEREST OF JUSTICE, TO REMIT THIS MATTER BACK TO THE FILE OF ASSESSING OFFICER WITH THE DIRECTION THAT PROPER AND THOROUGH VERIFICATION OF THE VALUES AS CLAIMED BY THE ASSESSEE COMPANY SHOULD BE UNDERTAKEN BY THE REVENUE TO BRING T O TAX THE CORRECT INCOME AS PER INCOME TAX ACT WHILE FRAMING DE - NOVO ASSESSMENT . NEEDLESS TO SAY THAT T HE ASSESSEE COMPANY WILL BE GIVEN PROPER AND ADEQUATE OPPORTUNITY BY THE ASSESSING OFFICER OF BEING HEARD AND TO SUBMIT ALL EVIDENCES ON WHICH THE ASSESS EE COMPANY MAY RELY TO SUPPORT ITS CONTENTION. 13 ITA NO 3383/MUM/2013 ASSESSMENT YEAR: - 2008 - 09. . PAGE 13 OF 23 9. THE (I) AND (II) GROUND OF APPEAL AS MENTIONED IN THE MEMO OF APPEAL FILED BY REVENUE RELATE TO THE SET OFF OF UNABSORBED DEPRECIATION OF EARLIER YEARS AGAINST THE LONG TERM CAPITAL GAIN EARNED BY THE ASSESSEE COMPANY . 10. DURING THE COURSE OF ASSESSMENT PROCEEDINGS , IT WAS FOUND BY THE ASSESSING OFFICER THAT THE ASSESSEE COMPANY HAS INCURRED BUSINESS LOSS OF RS. 77,77,959/ - AND AN UNABSORBED DEPRECIATION U/S. 32(2) OF THE ACT OF RS. 1,05,49,056/ - . TH E ASSESSEE COMPANY HAD CLAIMED IN ITS RETURN OF INCOME , LONG TERM CAPITAL GAIN FROM SALE OF MAZGAON UNIT. THE ASSESSING OFFICER OBSERVED THAT THE ASSESSEE COMPANY HAS SET OF F THE BUSINESS LOSS ALONG WITH DEPRECIATION LOSS OF RS. 80,48,985/ - AND BROUGHT FO RWARD BUSINESS LOSS OF RS. 27, 72,000/ - AGAINST THE LONG TERM CAPITAL GAIN EARNED DURING THE YEAR. THE A SSESSEE COMPANY WAS ASKED TO SHOW CAUSE AS TO WHY THIS SET OFF OF DEPRECIATION ALLOWANCE AND BROUGHT FORWARD BUSINESS LOSS AGAINST LONG TERM CAPITAL GAI N SHOULD NOT BE DISALLOWED. THE ASSESSEE COMPANY REPLIED THAT AS PER SECTION 32(2) OF THE ACT, ASSESSEE COMPANY CAN SET OFF UNABSORBED DEPRECIATION OF PRECEDING YEAR TO THE EXTENT OF RS. 5,97,22,612/ - AGAINST CURRENT YEARS INCOME FROM LONG TERM CAPITAL GAIN ARISING FROM SALE OF LAND. THE ASSESSEE COMPANY RELIED UPON THE DECISION OF HONBLE SUPREME COURT IN THE CAS E OF GARDEN SILK WEAVING FACTORY [189 ITR 512] (SC) ] TO CONTEND THAT DEPRECIATION ALLOWANCE CAN BE DEDUCTED FROM THE PROFIT & GAINS OF THE 14 ITA NO 3383/MUM/2013 ASSESSMENT YEAR: - 2008 - 09. . PAGE 14 OF 23 BUSINESS AS WELL AS OTHER INCOME. THE ASSESSEE ALSO RELIED UPON THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF CIT VS. VIRMANI INDUSTRIES PVT. LTD. 216 ITR 607 (SC) TO CONTEND THAT THE EXPRESSION PROFITS AND G A I NS CHARGEABLE OCCURRING IN SEC. 32(2) OF THE ACT IS NOT CONFINED TO PROFITS AND GAINS FROM BUSINESS OR PROFESSION BUT TAKES WITHIN ITS AMBIT ALL HEADS O F INCOME. HE ALSO RELIED UPON TH E DECISION OF HONBLE SUPREME COURT IN THE CASE OF CIT VS. JAIPURIA CHINA CLAY MINES (P) LTD. 59 ITR 555 (SC) TO CONTEND THAT UNABSORBED DEPRECIATION OF THE PAST YEARS SHOULD BE ADDED TO THE DEPRECIATION OF THE CURRENT YEAR AND AGGREGATE OF THE UNABSORBED DEPRECIATION AND THE CURRENT YEAR S DEPRECIATION BE DEDUCTED FROM THE TOTAL INCOME OF THE PREVIOUS YEAR. THE ASSESSING OFFICER REFERRED TO SECTION 32(2) R.W.S 72 OF THE ACT AND HELD THAT IF THERE IS NO INCOME UNDER THE HEAD PROFITS & GAINS OF BUSINESS AND THE PROFIT IS LESS THAN DEPRECIATION THEN THE UNABSORBED DEPRECIATION WILL BECOME DEPRECIATION U/S 32(1) OF THE NEXT YEAR AND THE SAME CAN BE SET OFF ONLY AGAINST THE PROFIT & GAIN OF BUSINESS. HE ALSO HELD THAT AS PER SECTION 71 OF THE ACT, T HE CURRENT YEARS BUSINESS LOSS CAN BE SET OFF AGAINST THE OTHER HEAD OF INCOME BUT UNABSORBED DEPRECIATION IS NOT THE PART OF THE BUSINESS LOSS AND CONCLUDED THAT AS PER SECTION 32( 1) AND 32(2 ) OF THE ACT , THE DEPRECIATION ALLOWA BLE IS ONLY TO THE EXTENT OF PROFITS & GAINS OF BUSINESS. THE ASSESSING OFFICER ALSO HELD THAT AS PER SECTION 72 OF THE ACT, THE BROUGHT FORWARD LOSS OF EARLIER YEARS CAN BE SET OFF ONLY AGAINST THE INCOME FROM PROFIT & GAINS OF ANY BUSINESS 15 ITA NO 3383/MUM/2013 ASSESSMENT YEAR: - 2008 - 09. . PAGE 15 OF 23 OR PROFESSION CARRIED OUT BY THE ASSESSEE COMPANY OF THE CURRENT YEAR AND SO ON . 11. AGGRIEVED, THE ASSESSEE COMPANY CARRIED THE MATTER TO CIT(A) AND REITERATED THE SUBMISSIONS AS MADE BEFORE THE ASSESSING OFFICER . THE CIT(A) HELD THAT SECTION 32(2) OF THE ACT WAS AM ENDED BY THE FINANCE ACT 1996 W.E.F . 01/04/1997 AND THEREAFTER BY FI N AN CE ACT 2001 W.E.F . 1/4/2002 AND HELD THAT THE UNABSORBED DEPRECIATION OF A PARTICULAR YEAR HAS BEEN ALLOWED TO BE CARRIED FORWARD IN SUBSEQUENT YEAR AND WAS REQUIRED TO BE TREATED AS PART OF DEPRECIATI ON OF THE NEXT/SUBSEQUENT YEAR. IN VIEW OF THIS POSITION, THE BROUGHT FO RWARD UNABSORBED DEPRECIATION BECOMES PART OF CURRENT YEARS DEPRECIATION WHICH COULD BE SET OFF AGAINST THE INCOME UNDER ANY HEAD OF INCOME OF THE YEAR. THE CIT(A) PLACED RELIANCE ON THE JUDGMENT OF HONBLE GUJARAT HIGH COURT IN THE CASE OF GENERAL MOTOR S PVT. LTD. (2013) 82 DTR (GUJ) 304 , AND HELD THAT AS PER PROVISIONS OF SECTION 32(2) OF THE ACT R.W.S 70,71 AND 72 OF THE ACT, ONCE UNABSORBED DEPRECIATION BECOMES PART OF THE CURRENT YEARS DEPRECIATION, IT CAN BE SET OFF AGAINST THE BUSINESS INCOME AS WELL AS INCOME FOR ANY OTHER HEAD OF INCOME AND HENCE THE CONTENTION OF THE ASSESSEE THAT BROUGHT FORWARD UNABSORBED DEPRECIATION OF EARLIER YEAR S CAN BE SET OFF AGAINST LONG TERM CAPITAL GAIN EARNED BY THE ASSESSEE WAS ACCEPTED. 16 ITA NO 3383/MUM/2013 ASSESSMENT YEAR: - 2008 - 09. . PAGE 16 OF 23 12. AGGRIEVED BY THE DECI SION OF CIT(A), REVENUE IS IN APPEAL BEFORE US. 13. BEFORE US, THE LD. DR RELIED UPON THE ORDER OF AO AND CONTENDED THAT AS PER SECTION 32(2) OF THE ACT , THE UNABSORBED DEPRECIATION CANNOT BE SET OFF AGAINST THE LONG TERM CAPITAL GAIN. HE ALSO RELIED ON S ECTION 71 OF THE ACT. 14. THE LD. AR, ON THE OTHER HAND, RELIED UPON THE JUDGMENT OF HONBLE GUJARAT HIGH COURT IN THE CASE OF GENERAL MOTORS PVT. LTD. (SUPRA) AND STATED THAT AS PER THE JUDGMENT OF GUJARAT HIGH COURT (SUPRA), THE UNABSORBED DEPRECIATION OF THE EARLIER YEAR WILL BECOME PART OF DEPRECIATION OF THE CURRENT YEAR DEPRECIATION AND CAN BE SET OFF AGAINST PROFIT AND GAIN FROM BUSINESS OR PROFESSION CARRIED ON THE ASSESSEE COMPANY AND ALSO AGAINST ANY OTHER HEAD OF INCOME OF THE CURRENT YEAR AND S O ON. 15. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND CAREFULLY PERUSED THE MATERIAL ON RECORD. WE HAVE CAREFULLY PERUSED THE PROVISIONS CONTAINED U/S 32(2) OF THE INCOME TAX ACT, WHICH READS AS UNDER: - SECTION 32(2 ) WHERE, IN THE ASSESSMENT OF THE ASSESSEE, FULL EFFECT CANNOT BE GIVEN TO ANY ALLOWANCE UNDER SUB - SECTION (1) IN ANY PREVIOUS YEAR, OWING TO THERE BEING NO PROFITS OR GAINS CHARGEABLE FOR THAT PREVIOUS YEAR, OR OWING TO THE PROFITS OR GAINS CHARGEABLE BEING LESS THAN THE ALLOWANCE, THEN, SUBJECT TO THE PROVISIONS OF SUB - SECTION (2) OF SECTION 72 AND SUB - SECTION (3) OF SECTION 73 , THE ALLOWANCE OR THE 17 ITA NO 3383/MUM/2013 ASSESSMENT YEAR: - 2008 - 09. . PAGE 17 OF 23 PART OF THE ALLOWANCE TO WHICH EFFECT HAS NOT BEEN GIVEN, AS THE CASE MAY BE, SHALL BE ADDED TO THE AMOUNT OF THE ALLOWANCE FOR DEPRECIATION FOR THE FOLLOWING PREVIOUS YEAR AND DEEMED TO BE PART OF THAT ALLOWANCE, OR IF THERE IS NO SUCH ALLOWANCE FOR THAT PREVIOUS YEAR, BE DEEMED TO BE THE ALLOWANCE FOR THAT PREVIOUS YEAR, AND SO ON FOR THE SUCCEEDING PREVIOUS YEARS.] 16. WE HAVE OBSERVED THAT THE CURRENT YEARS DEPRECIATION IS ALLOWED TO BE SET OFF AGAINST THE INCOME FROM BUSINESS AS WELL AS AGAINST THE OTHER HEAD S OF INCOME AND UNABSORBED DEPRECIATION IS CARRY FORWARD AND BECOME PART OF THE DEPRECIATION OF THE SUBSEQUENT YEAR AND THE TOTAL DEPRECIATION BECOMES CURRENT YEARS DEPRECIATION AS PER SECTION 32(1) OF THE A CT, WHICH IS ALLOWED TO BE SET OFF AGAINST THE INCOME UNDER ANY HEAD OF INCOME. AS PER THE PROVISIONS OF SECTION 32(2) OF THE ACT R.W.S 70,71 AND 72 OF THE ACT , IT BECOMES VERY CLEAR THAT THE TOTAL DEPRECIATION COMPRISING OF THE DEPRECIATION OF THE RELEVAN T ASSESSMENT YEAR ALONG WITH THE UNABSORBED DEPRECIATION OF THE EARLIER YEARS BECOMES THE TOTAL CURRENT YEARS DEPRECIATION WHICH IS ALLOWED TO BE SET OFF AGAINST INCOME UNDER ANY HEAD OF INCOME INCLUDING LONG TERM CAPITAL GAIN. ACCORDINGLY, WE FIND NO REA SON TO INTERFERE WITH THE ORDER OF CIT(A) QUA THIS ISSUE AND THE SAME IS HEREBY UPHELD. WE ALSO HOLD THAT AS PER PROVISIONS OF SECTION 72 OF THE ACT, THE UNABSORBED BUSINESS LOSS (OTHER THAN SPECULATIVE LOSS) OF EARLIER YEAR S SHALL BE ALLOWED TO BE SET OFF ONLY AGAINST THE PROFITS & GAINS FROM BUSINESS CARRIED ON BY THE ASSESSEE OF THE CURRENT YEAR AND SO ON . WE ORDER ACCORDINGLY. HOWEVER, OUR ABOVE DECISION WITH RESPECT TO GROUND 18 ITA NO 3383/MUM/2013 ASSESSMENT YEAR: - 2008 - 09. . PAGE 18 OF 23 NO (I) AND (II) RAISED IN MEMO OF APPEAL FILED BY REVENUE SHOULD BE READ IN CO NJUNCTION WITH AND SUBJECT TO OUR FINDINGS WITH RESPECT TO GROUND NO. (III) AND (IV) WHICH ARE DECIDED BY US IN THE PRECEDING PARAS OF THIS ORDER AND THE COMPUTATION SHALL BE MADE ACCORDINGLY . 17. THE (V) GROUND OF APPEAL RAISED BY THE REVENUE IN MEMO OF APPEAL FILED IS REGARDING ADDITION OF RS. 58,18,028/ - ON ACCOUNT OF SHORT TERM CAPITAL GAIN ON SALE OF BUILDING SITUATED AT SEML AHMADABAD . 18. THE ASSESSING OFFICER HELD THAT ASSESSEE COMPANY HAS NOT OFFERED FOR TAXATION THE SALE CONSIDERATION WITH RESPECT TO BUILDING IN CASE OF SEML, AHMADABAD , IN THE COMPUTATION OF INCOME BECAUSE ASSESSEE COMPANY HAS NOT PROVIDED ANY WDV OF THE BUILDING BLOCK OF ASSET WHICH WAS , HENCE, TAKEN TO BE AT RS. NIL BY THE ASSESSING OFFICER AND HENCE 58,18,028/ - WAS BROUGHT TO TAX AS SHORT TERM CAPITAL GAIN ON SALE OF BUILDING AT SEML , AHEMDABAD SOLD BY THE ASSESSEE COMPANY . AGGRIEVED, THE ASSESSEE COMPANY CARRIED THE MATTER TO CIT(A) AND CONTENDED THAT THIS AMOUNT OF RS. 58,18,028/ - WAS FO R SALE CONSIDERATION OF BUILDING AT SEML, AHMADABAD ADOPTED BY THE ASSESSEE COMPANY . THE ASSESSEE COMPANY CONTENDED THAT IT HAS TWO FACTORY BUILDINGS WHICH WERE TREATED AS PART OF THE SAME BLOCK OF ASSETS CONSISTING OF BUILDING . THE OPENING WDV, ADDITIONS DURING THE YEAR, SOLD DURING THE YEAR IN RESPECT OF AMBATTUR BUILDING AND SEML , AHMADABAD WAS AS UNDER : - 19 ITA NO 3383/MUM/2013 ASSESSMENT YEAR: - 2008 - 09. . PAGE 19 OF 23 FACTORY BUILDING BLOCK OF ASSET WDV AS ON 01.04.2007 ADDITIONS MORE THAN 180 DAYS ADDITION LESS THAN 180 DAYS TOTAL SOLD AMBATURR 98,60,090 4,37,705 11,43,905/ - 1,14,41,700 62,70,000 SEM L, AHMEDABAD 1,88,224 -- -- 1,88,224 58,03,710 TOTAL 1,00,48,314 4,37,705 11,43,905 1,16,29,924 1,20,73,710 THE ASSESSEE COMPANY CONTENDED THAT ALL THE SAME TYPES OF ASSETS WILL FORM PART OF ONE BLOCK OF ASSET. THE BUILDING SITUATED AT AMBATTUR AND AHMADABAD FORM PART OF ONE BLOCK OF ASSET AS IT CAN BE OBSERVED FROM THE ABOVE CHART , THE SEML AHMADABAD BUILDING AND AMBATTUR BUILDING WAS FORMING PART OF BLOCK OF ASSET AND AS PER SECTION 50 OF THE ACT, THE SALE VALUE RECEIVED IS FIRST REQUIRED TO BE ADJUSTED TOWARDS WDV OF THE BLOCK OF ASSET AND THE REMAINING , IF ANY WAS REQUIRED TO BE ASSESSED AS SHORT TERM CAPITAL GAIN U/S 50 OF THE ACT , COMBINED WDV BEING COST A S WELL SALE VALUE OF BOTH THE BUILDING S IE AMBATTUR AND AHMADABAD BUILDING WAS REQUIRED TO BE CONSIDERED TOGETHER AND IT IS NOT REQUIRED TO BE CONSIDERED SEPARATELY. BASED UPON THE SAME, THE CIT(A) HELD THAT THE SHORT TERM C APITAL GAIN OF RS. 4,43,786/ - BEING THE DIFFERENCE BETWEEN RS. 1,20,73,710 AS COMBINED SALE VALUE LESS THE COMBINED WDV OF BOTH THE BUILDINGS FORMING PART OF BLOCK OF ASSET AT RS. 1,16,29,924 IS RIGHTLY OFFERED TO TAX BY THE ASSESSEE 20 ITA NO 3383/MUM/2013 ASSESSMENT YEAR: - 2008 - 09. . PAGE 20 OF 23 COMPANY AS SHORT TERM CA PITAL GAIN AND HENCE THE CIT(A) DELETED THE ADDITION MADE BY THE ASSESSING OFFICER . 19. AGGRIEVED, THE REVENUE IS IN APPEAL BEFORE US. 20. LD. DR RELIED UPON THE ORDER OF ASSESSING OFFICER AND CONTENDED THAT THE ASSESSING OFFICER HAS RIGHTLY BROUGHT TO TAX RS.58,18,028 AS SHORT TERM CAPITAL GAIN. 21. THE ASSESSEE COMPANY RELIED UPON THE ORDER OF THE CIT(A) AND SUBMITTED THAT THE SHORT TERM CAPITAL GAIN OF RS. 4,43,787/ - WAS DULY OFFERED TO TAX AS PER SECTION 50 OF THE INCOME TAX ACT WHICH INCLUDED BOTH T HE BUILDING I.E. AMBATURR, CHENNAI AND SEML BUILDING AT AHMADABAD . 22. WE HAVE CONSIDERED THE RIVAL SUBMISSION AND CAREFULLY PERUSED THE RELEVANT MATERIAL ON RECORD. AFTER CONSIDERING THE FACTS OF THE CASE, AND MATERIAL ON RECORD, WE ARE OF THE VIEW THAT A SSESSEE COMPA N Y HAS DULY INCLUDED THE SHORT TERM CAPITAL GAIN OF AHMADABAD BUILDING AS WELL AS AMBATTUR BUILDING U/S 50 OF THE ACT, BY REDUCING THE WDV OF BOTH BUILDINGS IE AMBATTUR BUILDING AND SEML, AHEMADABAD BUILDING FORMING PART OF ONE BLOCK OF ASSETS FROM THE SALE CONSIDERATION. ACCORDINGLY, WE UPHOLD THE DECISION OF CIT(A) IN DELETING THE ADDITION S MADE BY THE ASSESSING OFFICER . HOWEVER, OUR ABOVE DECISION SHOULD BE READ IN CONJUNCTION WITH AND SUBJECT TO OUR FINDINGS WITH RESPECT TO GROUND NO. ( III ) AND ( IV ) WHICH ARE DECIDED BY 21 ITA NO 3383/MUM/2013 ASSESSMENT YEAR: - 2008 - 09. . PAGE 21 OF 23 US IN THE PRECEDING PARAS OF THIS ORDER AND THE COMPUTATION SHALL BE MADE ACCORDINGLY. 23. GROUND NO. (VI) IS WITH RESPECT TO THE WDV VALUE OF BLOCK OF BUILDING AT RS. 1,16,29,924 / - HELD BY CIT(A) AS AGAINST THE VALUE OF RS. 1,14,41,700/ - ADOPTED BY THE ASSESSING OFFICER 24. THE ASSESSING OFFICER ADOPTED RS. 1,14,41,700/ - AS THE WDV OF THE AMBATTUR I NDUSTRIAL E STATE OF THE BUILDING FORMING PART OF BLOCK OF ASSET WHILE IN THE CASE O F BUILDING SEML, AHMA DABAD WDV VALUE WAS FOR THE SAID BLOCK OF ASSET WAS ADOPTED AT NIL BY THE ASSESSING OFFICER FOR THE PURPOSE OF COMPUTING CAPITAL GAIN CHARGEABLE TO TAX. 25. AGGRIEVED BY THE ORDER OF ASSESSING OFFICER , THE ASSESSEE COMPANY CARRIED THE MATTER TO THE CIT(A) AND STATED THAT THE ASSESSING OFFICER HAS NOT GIVEN THE EFFECT OF SEML B UILDING , AHMADABAD OF WDV OF BLOCK OF ASSET OF RS. 1,88,244/ - WHICH IS PART OF THE SAME BLOCK OF ASSET CONSISTING OF AMBATTUR BUILDING AND AHMADABAD BUILDING OWNED BY THE ASSE S SEE COMPANY . THE CIT(A) AFTER PERUSING THE MATERIAL, HELD THAT THE CORRECT BLOCK OF BUILDING WDV OF BOTH THE FACTORY BUILDING AT AMBATTUR AND AHMA DABAD IS RS. 1,1 6,29,924 / - AND ADDITIONS MADE BY THE ASSESSING OFFICER WAS DELETED . 26. AGGRIEVE D, THE REVENUE IS IN APPEAL BEFORE US. 22 ITA NO 3383/MUM/2013 ASSESSMENT YEAR: - 2008 - 09. . PAGE 22 OF 23 27. LD. DR RELIED UPON THE ORDER OF THE ASSESSING OFFICER , WHEREAS, THE ASSESSEE COMPANY RELIED UPON THE ORDER S OF CIT(A). 28. WE HAVE CONSIDERED THE RIVAL SUBMISSION AND CAREFULLY PERUSED THE MATERIAL ON RECORD. WE HAVE OBSERVED THAT AS PER THE ABOVE CHART REFERRED IN THE PRECEDING PARAS , BLOCK OF ASSET CONSISTING OF BUILDINGS SITUATED AT AMBATTUR BUILDING AS WE LL AS SEML BUILDING AT AHMADABAD INCLUDED BOTH THE BUILDING S WITH WDV AT RS. 1,16,29,924 / - AND WHILE COMPUTING THE SHORT TERM CAPITAL GAIN U/S 50 OF THE ACT, THE EFFECT HAS TO BE GIVEN FOR BOTH THE BUILDINGS I.E. SEML, AHMADABAD AND AMBATTUR BUILDING AND, THEREFORE, WE FIND NO ERROR OR ILLEGALITY IN THE ORDER OF CIT(A) AND THE SAME IS HEREBY AFFIRMED. HOWEVER, OUR ABOVE DECISION SHOULD BE READ IN CONJUNCTION WITH AND SUBJECT TO OUR FINDINGS WITH RESPECT TO GROUND NO. ( III ) AND ( IV ) WHICH ARE DECIDED BY US IN THE PRECEDING PARAS OF THIS ORDER AND THE COMPUTATION SHALL BE MADE ACCORDINGLY. 29 . IN THE RESULT APPEAL OF THE REVENUE IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 2 4 T H DAY OF SEPTEMBER 2015. S D / - S D / - (AMIT SHUKLA) (RAMIT KOCHAR) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) MUMBAI DATED - 0 9 - 2015 23 ITA NO 3383/MUM/2013 ASSESSMENT YEAR: - 2008 - 09. . PAGE 23 OF 23 SKS SR. P.S, COPY TO: THE APPELLANT THE RESPONDENT THE CONCERNED CIT(A) THE CONCERNED CIT THE DR, G BENCH, ITAT, MUMBAI BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCHES, MUMBAI