Hanumant Kumar Talesara, UDAIPUR V. CIT(A), UDAIPUR

ITA 383/JODH/2008

• Counselvise Citation: 38323314 RSA 2008
• Duration Of Justice: 3 year(s) 6 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-12-2011
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Next Hearing Date: 30-11-2011
• Assessment Year: 2004-2005
• Appeal Filed On: 22-05-2008
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Sale consideration of property below Jantri Value; Capital asset; Additional evidence; Cost of acquisition
• Section: 50C; 2(14); 131; 12

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL JODHPUR BENCH, JODHPUR (BEFORE SHRI R.K. GUPTA AND SHRI .N.L. KALR A ) ITA NO.383/JU/2008 ASSESSMENT YEAR : 2004-05 PAN: ADDPT 2245 B SHRI HANUMANT KUMAR TALESARA VS. THE ITO 172/12, ASHOK MAGAR, WARD- 2 (1), UDAIPUR UDAIPUR (APPELLANT) (RESPONDENT) ITA NO.389/JU/2008 ASSESSMENT YEAR : 2004-05 PAN: ADDPT 2245 B THE ITO VS. SHRI HANUMANT KUMAR TALESARA WARD- 2 (1) 172/12, ASHOK MAGAR, UDAIPUR UDAIPUR (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI AMIT KOTHARI DEPARTMENT BY: SHRI MAHESH KUMAR DATE OF HEARING: 30-11-2011 DATE OF PRONOUNCEMENT: 09-12-2011 ORDER PER N.L. KALRA, AM:- THE ASSESSEE AS WELL AS THE REVENUE HAVE FILED APP EALS AGAINST THE ORDER OF THE LD.CIT(A), UDAIPUR DATED 25-03-2008 FOR THE ASSESS MENT YEAR 2004-05. 2.1 THE FIRST GROUND OF ASSESSEE IS THAT THE LD. CI T(A) HAS ERRED IN UPHOLDING THE SALE CONSIDERATION OF AGRICULTURAL LAND AT RS. 17,35,301 /- AS AGAINST RS. 7.51 LACS DECLARED BY THE ASSESSEE . 2.2 THE LD.CIT(A) VIDE PARAS 3 TO 7 OF HIS ORDER HA S CONSIDERED THE FACTS AS CONTAINED IN THE ASSESSMENT ORDER AND THE SAME ARE REPRODUCED AS UNDER:- 2 3. THE FACTS OF THE CASE AS OBSERVED BY THE AO IN THE ORDER ARE THAT DURING THE YEAR THE ASSESSEE SOLD AGRICULTURE LAND MEASURING 1.045 HECTARES SITUATED AT BADWAS, UDAIPUR FOR A CONSIDERATION OF RS. 7,5 1,000/- AND DECLARED LONG TERM CAPITAL GAIN AT RS.4,25,074/- AND THE SAME HAS BEEN CLAIMED EXEMPT U/S 54EC BY INVESTING RS.4,30,000/- IN THE BONDS OF RURAL ELECT RIFICATION BOARD. THE AO ASKED THE ASSESSEE TO SUBMIT COPY OF REGISTE RED DEED FOR SALE OF LAND. THE ASSESSEE HAS SUBMITTED COPY OF FOUR SALE DEEDS FOR AREA OF LAND MEASURING 0.6695 HECTARE AS U NDER :- IN VIEW OF THE ABOVE IT WAS CLEAR THAT THE SALES CO NSIDERATION WAS LESS THAN THE VALUE ADOPTED BY THE REGISTERING AUTHORITY FOR STAMP DUTY PURPOSES. SECTION 50C OF THE ACT SPECIFY THE P ROVISIONS IN THE SITUATIONS WHEN THE VALUE ADOPTED BY REGISTERIN G AUTHORITIES IS MORE THAN THE SALES CONSIDERATION DECLARED BY THE ASSESSEE. THE AO EXTRACTED THE RELEVANT PART OF SECTION 50C. 4. THE A0, THEREFORE, ASKED THE ASSESSEE AS TO WHY THE VALUE ADOPTED BY THE SUB REGISTRAR SHOULD NOT BE ADOPTED FOR CALCULATION OF CAPITAL GAIN. IN RESPONSE TO WHICH T HE ASSESSEE SUBMITTED THAT THE ASSESSEE HAS EXECUTED AGREEMENT TO SALE FO R AFORESAID AGRICULTURE LAND ON 3-9-03 IN FAVOUR OF SHRI ASHOK PARIKH S/O SHRI RAGHUNATH DAS NATHDWARA AND SHRI CHAIR SINGH PADIYA R, BADGAON, S.NO . NAME OF THE PURCHASER AREA AMOUNT OF SALE VALUE FOR REGISTRY 1 SHRI GYAN SINGH & OTHERS 0.1680 116500 435417 2 SHRI POONA &OTHERS 0.1685 117000 436690 3 SHRI VINOD KUJBANDA & OTHERS 0.1776 123000 459606 4 SHRI DEVA RAM & OTHERS 0.1555 107000 403588 TOTAL 0.6696 463,500 17,35,301 3 UDAIPUR. WHO WERE JOINTLY TERMED AS 'SECOND PARTY BUYER' AND HAS BEEN SIGNED BY THE ASSESSEE AND SHRI CHAIN SINGH. THE TOTAL SALE PROCEEDS WAS RS.7,51,000/- WAS PAID BY THE SECOND PARTY AND WAS REVIVED BY THE ASSESSEE AND W.E.F. 3-9- 03 THE PHYSICAL POSSESSION OF THE SAID AGRICULTURE LAND WAS HANDED OVER TO THE BUYERS WITH ALL OWNERSHIP RIGHTS . AS PER CLAUSE 10 OF THE SAID AGREEMENT TO SALE DATED 3-9-03 THE TOTAL STAMP DUTY AND REGISTRATION EXPENSES WAS TO BE BORNE BY THE SECOND PARTY, THE BUYER, MEANING BY AS PER PROVISIO NS OF THE CAPITAL GAIN TAX THE AFORESAID TRANSACTION WAS FULLY COVERE D UNDER THE DEFINITION OF 'TRANSFER' AS WELL AS THE ACTUAL TRAN SFER AND SALE OF THE LAND TOOK PLACE ON 3-9-03 FOR ALL PURPOSES. ON SUBSEQUENT DATE I.E. 4-9-03 THE ASSESSEE EXECUTED A REGISTERED GENERAL POWER OF ATTORNEY IN FAVOUR OF SHRI DEVKINANDAN GURJAR OF NATHDWARA AND SHRI DILIP SURANA OF UDAIPU R IN A SET PROFORMA NORMALLY USED FOR GIVING SUCH POWER OF ATT ORNEY WHICH WAS INTENDED TO EXECUTE THE REGISTRY IMMEDIATELY AFTER AFORESAID SALE AGREEMENT AS THE ASSCSSEE WAS 70 YEARS OLD FOR WHIC H HE BEING BUSY ERSTWHILE AND NOT POSSIBLE AND PRACTICAL FOR H IM TO APPEAR AGAIN AND AGAIN BEFORE REGISTERING AUTHORITY AND, THEREFORE, POWER OF ATTORNEY WAS GIVEN AND EXECUTED FOR REGISTRATION OF SALE DEED. THE ASSESSEE DID NOT KNO W NOR THERE WAS ANY REQUIREMENT TO KNOW WHETHER THE SAID LAND WAS REGISTERED BY SALE DEED BECAUSE ALL ACTS AND DEEDS WERE COMPLETED AND CONCLUDED BY HIM AS ABOVE. AFTER GOING THROUGH THE CONTENTS OF REGISTERED SALE DEEDS IT WAS INFERRED THAT THE SALE DEEDS WERE EXECUTED AFTER MORE THAN A MONTH ON 10/15-10-2003 B Y THE POWER OF ATTORNEY HOLDER ON GETTING MUCH MORE HIGHER SALE PROCEEDS TO ANOTHER/DIFFERENT BUYERS AS ENUMERATED IN SALE D EEDS , FOR WHICH THE SAID POWER OF ATTORNEY HOLDER SHRI DEVKINANDAN GURJAR AND SHRI DILIP SURANA IN COLLUSION ALONGWITH SHRI A SHOK 4 PARIKH AND SHRI CHAIN SINGH PADIYAR WHO ARE LIABLE AND ALSO IDENTIFIABLE PERSONS WHO MADE THIS SHAM TRANSACTION S IS SOLELY LIABLE FOR ALL CONSEQUENCES UNDER THE PROVISIONS OF THE ACT. THE ASSESSEE ALSO SUBMITTED THAT WITHOUT PREJUDICE TO A BOVE THE SAID LAND WAS AN AGRICULTURE LAND OUT OF PURVIEW OF CAPI TAL GAIN TAX, THOUGH THE ASSESSEE PAID CAPITAL GAIN FOR WHICH PRAY FOR REFUND. WITHOUT PREJUDICE TO ABOVE THE VALUE A DOPTED BY THE STAMP VALUATION AUTHORITY U/S 50C( I) IS EXCEEDS THE MARKET VALUE AS ON 3-9-2003. 5. THE AO CONSIDERED THE EXPLANATION OF THE ASSESSEE AND OBSERVED THAT THE FACTS NARRATED BY THE ASSESSEE MAY CORRECT THAT HE SOLD THE PROPERTY TO SHRI ASHOK PARIKH AND SHRI CHAIN SINGH ON 3- 9-2003 AND ON THE NEXT DAY, HE ISSUED A POWER OF AT TORNEY IN THE NAME OF DEVKI NANDAN GUJAR, WHO MADE REGISTRY IN THE NAME OF OTHER PERSONS ON THE DIRECTION OF SHRI ASHOK PAR IKH AND SHRI CHAIN SINGH . BUT THESE FACTS DO NOT AFFECT THE TAX LIABILITY ON CAPITAL GAIN OF THE ASSESSEE. HAD THE REGISTRY BEEN MADE IN THE NAME OF SHRI ASHOK PARIKH AND SHRI CHAIN SIN GH INSTEAD OF OTHER PERSONS EVEN THEN THE VALUE ASSESSED BY THE STAMP VALUATION AUTHORITY WOULD HAVE BEEN SAME. THEREFORE, WHATEVER THE FACTS OF THE CASE MAY BE BU T THE PROVISIONS OF SECTION 50C OF THE ACT CLEARLY PROVIDES THAT IN THE CASE WHERE SALES CONSIDERATION ACTUALLY RECEIVE D IS LOWER THAN THE VALUE ADOPTED OR ASSESSED BY THE STAMP VAL UATION AUTHORITY FOR THE PURPOSE OF PAYMENT OF STAMP DUTY THEN THE VALUE ASSESSED BY THE STAMP VALUATION AUTHORITY SHA LL BE TAKEN AS SALE VALUE FOR THE PURPOSE OF CALCULATING CAPITAL G AIN. THE ASSESSEE SUBMITTED THE COPY OF REGISTRIES FOR SALE OF 0.695 HECTARE VALUE OF WHICH HAS BEEN ASSESSED BY STAMP V ALUATION AUTHORITY. WAS ADOPTED AT RS.17,35,301/- AS SUCH THE VALUE FOR STAMP DUTY PURPOSES IS WORKED OUT BY THE AO AT RS.2 7,08,000 5 (17,35,301/0.6695 X 1.045). 6. FURTHER THE CLAIM OF THE ASSESSEE THAT THE LAND IS AGRICULTURE AND OUT OF PURVIEW OF CAPITAL GAIN WAS ALSO NOT ACCEPTABLE AS THE AGRICULTURE LAND IS SITUATED IN T HE MUNICIPAL AREA AND AS PER SECTION 2(14) (III) SUCH LAND IS CAPITAL ASSETS AND AS PER SECTION 45 OF THE ACT ANY PROFIT OR GAIN ARISING FR OM THE TRANSFER OF A CAPITAL ASSETS SHALL BE CHARGEABLE TO INCOME TAX. 7. ON REQUEST OF THE ASSESSEE, THE MATTER WAS REFERRED TO VALUATION CELL AND THE DVO, AJMER VIDE REPORT DATED 19-12-2006 ESTIMATED THE FARE MARKET VALUE OF THE L AND AT RS.27,08,000/-, THE SAME VALUE WHICH IS WORKED OUT AS PER DLC RATE. IN VIEW OF THE ABOVE OBSERVATIONS, THE AO ADO PTED THE SALE CONSIDERATION AT RS.27,08,000/-. 2.3 BEFORE THE LD.CIT(A), ASSESSEE STATED IN BRIEF THE MODUS OPERANDI FOR SALE AND PURCHASE OF REAL ESTATE TRANSACTIONS PREVALENT IN T HE MARKET. ONE OF THE MODE IS TO SELL THE PROPERTY DIRECTLY TO THE PURCHASER THROUGH REGISTER ED SALE DEED. INCASE THE PURCHASER INTENDS TO MAKE SUBSEQUENT SALES OF SUCH IMMOVABLE PROPERTIES BY HIM OR THROUGH SOME BROKER THEN THE PURCHASER EXECUTE AGREEMENT TO SELL AND OBTAIN THE GENERAL POWER OF ATTORNEY FROM THE SELLER IN HIS FAVOUR OR IN FAVOUR OF SOME BROKERS FOR SUBSEQUENT SALE OF THE PROPERTIES. THE SELLER EXECUTES AGREEMENT TO SE LL IN FAVOUR OF THE PURCHASER AND RECEIVED THE SALE CONSIDERATION AND HAND OVER THE P OSSESSION OF THE PROPERTY TO THE PURCHASER. WHEN PURCHASER OF THE PROPERTY FINDS THE SUBSEQUENT PURCHASER THEN POWER OF ATTORNEY HOLDER EXECUTES THE SALE DEED IN FAVOUR OF ULTIMATE PURCHASER AND RECEIVES THE SALE CONSIDERATION OF THE PROPERTY ON BEHALF OF TH E PURCHASER TO PURCHASE THE PROPERTY FROM THE SELLER. THE LD. AR SUBMITTED THAT IN THE I NSTANT CASE, THE MODUS OPERANDI OPERATED IS THAT THE PURCHASER SUBSEQUENTLY SOLD TH E PROPERTY TO ANOTHER PURCHASER THOUGH 6 THE SELLER EXECUTES THE SALE DEED. THE SELLER HAS N OT RECEIVED CONSIDERATION AS PER REGISTERED SALE DEED. IT WAS THEREFORE, SUBMITTED T HAT SECTION 50C WILL NOT BE APPLICABLE BECAUSE THE ASSESSEE HAS SOLD THE PROPERTY ON THE B ASIS OF THE AGREEMENT. THE LD.CIT(A) HAS REFERRED TO THE FACT THAT THE AO HAS RECORDED T HE STATEMENT OF SHRI ASHOK PARIKH U/S 131 OF THE ACT. SHRI ASHOK PARIKH STATED THAT HE HA S NEITHER EXECUTED THE AGREEMENT WITH THE ASSESSEE NOR MADE ANY PAYMENT AGAINST SUCH AGRE EMENT TO SELL. THE AO HAS ALSO RECORDED THE STATEMENT OF CHAIN SINGH ON 27-7-06 U/ S 131 OF THE ACT. IN IT , HE STATED THAT HE EXECUTED THE AGREEMENT TO SELL OF RS. 7.51LACS F OR PURCHASE OF AGRICULTURAL LAND OF THE ASSESSEE BUT THE SAID AGREEMENT COULD NOT BE MATERI ALIZED AS HE COULD NOT MAKE PAYMENT FOR WANT OF FUNDS. 2.4 THE ASSESSEE SUBMITTED THAT HE HAS RECEIVED SAL E CONSIDERATION OF RS. 7.51 LACS FROM SHRI CHAIN SINGH AND SALE CONSIDERATION IS MEN TIONED IN THE PERSONAL CASH BOOK OF THE ASSESSEE. THE POSSESSION OF THE OWNERSHIP RIGHT OF THE LAND WERE TRANSFERRED TO THE PURCHASER BY HANDING OVER THE POSSESSION OF THE LAN D FOR THE PURPOSE OF ABOVE AGREEMENT TO SELL. BEFORE THE LD.CIT(A), IT WAS SUBMITTED THA T THE CONTENTS OF THE AFFIDAVIT FILED BY THE ASSESSEE WERE NOT REBUTTED BY THE AO AND THEREF ORE, THESE AFFIDAVITS ARE TO BE ACCEPTED. FOR THIS PURPOSE, RELIANCE WAS PLACED ON THE HON'BLE APEX COURT IN THE CASE OF MEHTA PARIKH & CO. VS CIT , 30 ITR 181. 2.5 THE LD.CIT(A),AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE AND TAKING INTO ACCOUNT THE FACTS NOTICE IN THE ASSESSMENT ORDER DI RECTED THE AO TO ADOPT THE SALE VALUE OF RS. 17,35,301/- AS AGAINST RS. 27.08 LACS AFTER OB SERVING AS UNDER:- 36. I HAVE CONSIDERED THE FACTS OF THE CASE AND SUB MISSION OF THE LD. A/R AND FOUND THAT THE AO COMPUTED THE CAPITAL IN ACCORDANCE WITH THE PROVISIONS OF SECTION 50C OF TH E ACT. THE AO 7 ADOPTED TOTAL SALE CONSIDERATION AT RS.27,08,000/- BY ADOPTING SALE RATE ADOPTED BY THE REGISTERING AUTHORITY/DVO, AJMER FOR THE VALUE OF WHOLE LAND MEASURING 1.045 HECTARE S AGAINST THE LAND SOLD AT 0.6696 HECTARES. THE AO ALLOWED INDEXED COST OF ACQUISITION AT RS.2,62,836/- BY ADO PTING THE COST AS ON 1-4-1981 AT RS. 58,800/. AS AGAINST THE CLAIM OF RS.3,25,925/-. AFTER ALLOWING DEDUCTION FOR INDEXED COST AND DEDUCTION U/S 54EC, THE AO COMPUTED THE NET CAPITAL GAIN AT RS.20,15,164/- AND TAXED ACCORDINGLY. 37. THE ID. A/R SUBMITTED THAT, THE APPELLANT SOLD LAND 'ONLY TO THE EXTENT OF 0.6696 HECTARE WHICH IS EVIDENT FROM THE REGISTERED DOCUMENT ACCEPTED BY THE AO FOR CALCULATION OF CAPI TAL GAIN U/S 50C. THEREFORE, THE AO WAS NOT JUSTIFIED IN PROPORTIONAT ELY INCREASING THE SALE VALUE TO RS.27,08,000/- OF THE WHOLE LAND WITH OUT ANY CORROBORATIVE EVIDENCE COLLECTED BY THE AO TO SHOW THAT THE APPELLANT SOLD THE ENTIRE LAND. HOWEVER, THE SALE AGREEMENT DATED 3-9-2003 WAS MADE FOR THE WHOLE LAND AND THE SALE P ROCEEDS COULD NOT BE MATERIALIZED WHICH IS EVIDENT FROM THE CONSEQUEN T GENERAL POWER OF ATTORNEY DATED 4-9-2003 IN FAVOUR OF SHRI DEVKI NANDAN GURJAR AND SHRI DILIP SURANA FOR THE WHOLE LAND MEA SURING 1.045 HECTARE AND THE POWER OF ATTORNEY HOLDERS SOLD THE LAND MEASURING 0.6696 H ECTARS FOR RS.4,63,500/-BUT THE REGISTERING AUTHORITY ADOPTED THE VALUE AT RS.17,35,301/- FOR STAMP DUTY PURPOSE. THEREFORE, IT IS CLEAR THAT THE POWER OF A TTORNEY HOLDER SOLD LAND MEASURING 0.6696 HECTARE ONLY AND NOT THE WHOLE LAND. THEREFORE, THE AO WAS NOT JUSTIFIED IN PROPORTIONATELY ADOPTED THE VALUE AT RS.27,08,000/-. FURTHER AO ALLOWED INDEXED COST OF ACQUISITION FOR ONE REGISTRY DATED 25-2-1980 OF RS. 53.465/- AND BY INCREASING 10%, THE AO ADOPTED THE COST OF ACQUISITION AT 8 RS.58,800/- ON THE GROUND THAT THE PURCHASED VIDE REGISTRY DATED 26-2-1980 WAS IN THE NAME OF SHRI MUKESH KUMAR, THE SON OF THE APPELLANT. 37. ON GOING THROUGH THE FACTS OF THE CASE I FOUND THAT THE AO WAS JUSTIFIED IN ADOPTING THE SALE CONSIDERATION U/S 50C OF THE ACT. HOWEVER, THE AO S HOULD HAVE TAKEN AREA OF LAND SOLD AS PER THE DOCUMENTS R EGISTERED AT 0.6696 HECTARE. THEREFORE, THE AO WAS NOT JUSTIFIED IN PROPORTIONATELY ADOPTING THE SALE CONSIDERATION ON WHOLE LAND OF 1.045 HECTARE WHICH IS ONLY ON PRESUMPTION AND NOT IN ACCORDANCE WITH THE PROVISIONS OF SECTION 50C. THE DVO TAKEN THE VALUE AT RS.27,08,000/- FOR 1.045 HEC TARE ON THE BASIS OF VALUE ADOPTED BY THE STAMP DUTY AUTHOR ITY AND NOT FOR 0.6696 HECTARE. THE AO HAS ALSO NOT COLLECTED ANY MATERIAL TO SHOW THAT THE APPELLANT SOLD THE ENTIRE PROPERTY. THEREFORE, THE AO SHOULD HAVE ; ; ADOPTED THE VALUE AS PER THE REGISTERED DOCUMENTS. FROM THE REGISTERED DOCUMENTS ALSO IT IS VERY CLEAR THAT THE APPELLANT HAS NOT SO LD THE ENTIRE PROPERTY WHICH IS EVIDENT FROM ARAJI NO. GIVEN IN T HE DOCUMENT AS 1834,1835,, 1831, 1833 AND NO WHERE MENTIONED THE SALE OF AARAJI NO.1838 MEASURING 0.1550 HECTARES. THEREFORE, THE AO WAS NOT JUSTIFIED IN TAKING THE VALUE BY INCREASING PROPORTIONATELY ACCORDING TO TH E VALUE TAKEN FOR REGISTRATION PURPOSE INSTEAD OF TAKING TH E VALUE AS PER REGISTERED DOCUMENTS AT RS.17,35,301/-. THE AO IS DIRECTED TO ADOPT THE SALE VALUE AT RS.17,35,301/ AS AGAINST RS.27,08,000/- ADOPTED. 2.6 BEFORE US, THE LD. AR HAS FILED THE PAPER BOOK CONTAINING 98 PAGES. THE LD. AR HAS RELIED UPON WRITTEN SUBMISSIONS WHICH WAS PLACE D BEFORE THE LD.CIT(A). THE MAIN 9 CONTENTION OF THE LD. AR WAS THAT THE ASSESSEE TRAN SFERRED THE LAND AS PER AGREEMENT AND THE PROVISIONS OF SECTION 50C ARE NOT APPLICABLE IN CASE THE LAND IS TRANSFERRED THROUGHTHE AGREEMENT. SECTION 50C IS APPLICABLE WHEN THE AUTHO RITIES ADOPTED THE VALUE FOR THE PURPOSE OF STAMP DUTY. 2.7 ON THE OTHER HAND, THE LD. DR DREW OUR ATTENTIO N TO SECTION 50C OF THE ACT IN WHICH THE WORD ADOPTED HAS BEEN MENTIONED. THE WO RD ADOPTED MEANS THAT THE VALUE WHICH WILL BE TAKEN BY THE STAMP AUTHORITIES FOR TH E TRANSFER OF THE PROPERTY. HENCE, IT WAS SUBMITTED THAT SECTION 50C WILL BE APPLICABLE EVEN IF THE PROPERTY HAS BEEN TRANSFERRED ON THE BASIS OF SALE AGREEMENT. 2.8 WE HAVE HEARD BOTH THE PARTIES. THE ASSESSEE EN TERED INTO AGREEMENT ON 3-09- 2003 WITH SHRI ASHOK KUMAR PARIKH AND SHRI CHAIN SI NGH. IN THIS SALE AGREEMENT, IT IS MENTIONED THAT THE ASSESSEE RECEIVED A SUM OF RS. 7 .51 LACS FRM SHRI ASHOK KUMAR PARIKH AND SHRI CHAIN SINGH IN RESPECT OF SALE CON SIDERATION OF THE LAND. IN THIS AGREEMENT, IT WAS SUBMITTED THAT EXPENDITURE IF ANY TO BE INCURRED FOR SALE AND TRANSFER OF IMMOVABLE PROPERTY INCURRED BY THE ASSESSEE. AS PER CLAUSE 8 OF THE AGREEMENT, IT IS MENTIONED THAT THE ASSESSEE BEFORE REGISTRATION HAS GOT THE LAND MEASURED AND THE POSSESSION HAS BEEN GIVEN. 2.9 THEREAFTER THE ASSESSEE GAVE THE GENERAL POWER OF ATTORNEY IN FAVOUR OF SHRI DEVKINANDAN GURJAR AND SHRI DILIP SURANA ON 4-09-20 03. THE POWER OF ATTORNEY HOLDERS WERE AUTHORIZED TO SELL THE AGRICULTURAL LAND FOR W HICH THE ASSESSEE ENTERED INTO AN AGREEMENT OF SALE WITH SHRI ASHOK KUMAR PARIKHI AND SHRI CHAIN SINGH. IN THIS POWER OF ATTORNEY, THERE IS NO MENTION OF SALE AGREEMENT MAD E BY THE ASSESSEE. THE PERSONS IN WHOSE NAMES THE SALE AGREEMENT WAS EXECUTED ARE ALS O NOT WITNESSES. THIS POWER OF ATTORNEY HOLDER THEREAFTER SOLD THE LAND TO THE PAR TY WHO ARE NOT THE SAME FOR WHICH 10 ASSESSEE ENTERED INTO SALE AGREEMENT. IT IS TRUE TH AT ON THIS SALE DEED, ONE OF THE PARTY IN WHOSE NAME THIS AGREEMENT WAS EXECUTED WAS ALSO WIT NESS. THIS MEANS THAT THOSE PARTIES NEVER OBJECTED TO THE SALES MADE BY THE ASSESSEE TH ROUGH HIS POWER OF ATTORNEY HOLDER. THE AO HAS RECORDED THE STATEMENT OF SHRI ASHOK KUM AR PARIKH U/S 131 OF THE ACT. HE STATED THAT SAME AGREEMENT WAS PREPARED BUT AFTER M AKING PHYSICAL INSPECTION OF THE PROPERTY, HE TOOK DECISION OF NOT PURCHASING THIS P ROPERTY. THE AO RECORDED THE STATEMENT OF SHRI CHAIN SINGH. HE ALSO STATED THAT THE AGREEMENT WAS EXECUTED BUT THEY WERE NOT ABLE TO MAKE PAYMENT AND THEREFORE, PROPER TY WAS SOLD BY THE ASSESSEE TO OTHER PARTY. LOOKING TO THE FACTS AND MATERIAL EVIDENCE A VAILABLE ON RECORD, IT CANNOT BE INFERRED THAT THE ASSESSEE HAS BEEN ABLE TO ESTABL ISH THAT THE LAND WAS SOLD THROUGH AGREEMENT. IT HAS ALSO NOT BEEN ESTABLISHED THAT TH E ASSESSEE HAS HANDED OVER THE POSSESSION AS PART PERFORMANCE OF THE CONTRACT OF A GREEMENT TO SELL. THE PROPERTIES HAVE BEEN TRANSFERRED THROUGH REGISTERED SALE DEED. IF T HE DISPOSITION OF THE PROPERTY IS REDUCED IN THE FORM OF AGREEMENT THEN NO ORAL EVIDENCE CONT RACTING/ VARYING TERMS OF THE DOCUMENTS ARE NOT ACCEPTABLE. RELIANCE IS PLACED ON THE DECISION OF HON'BLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF PARAMJIT SINGH VS ITO , 236 CTR 466. CONSIDERING THE ABOVE DISCUSSIONS, WE HOLD THAT THE LD.CIT(A) W AS JUSTIFIED IN DIRECTING THE AO TO TAKE SALE CONSIDERATION OF AGRICULTURAL LAND AT RS. 17,35,,301/- AS AGAINST RS. 27.08 LACS ADOPTED BY HIM. 3.1 THE SECOND GROUND OF ASSESSEE IS THAT THE LD. C IT(A) HAS ERRED IN UPHOLDING THE COST OF ACQUISITION OF LAND AT RS. 58,800/- AS AGAI NST RS. 72,914/- AS STANDING THE BOOKS OF ACCOUNT OF THE ASSESSEE. 3.2 BEFORE THE AO, THE ASSESSEE SUBMITTED THAT TWO COPIES OF REGISTRATION FOR PURCHASES OF LAND AS PER THIS REGISTRY FOR PURCHASE OF LAND. AS PER THIS REGISTRY, THE 11 ASSESSEE CLAIMED THAT COST OF ACQUISITION SHOULD BE TAKEN AT RS. 72,914/-. THE AO CALCULATED THE COST OF ACQUISITION OF LAND AT RS. 5 8,800/- PRESUMING THE GROWTH RATE OF LAND AT 10% PER YEAR. 3.3 THE LD.CIT(A) HAS DECIDED THE ISSUE IN FAVOUR O F THE REVENUE AFTER OBSERVING AS UNDER:- 38. AS FAR AS THE COST OF ACQUISITION CLAIMED AT RS.72,914/-, ON VERIFICATION OF COPY OF REGISTRY FURNISHED, IT IS FOUND THAT THE REGISTRY DATED 26-2 - 1980 IS IN THE NAME OF SHRI MUKESH KUMAR AND IN THE POWER OF ATTORNEY AS WELL AS IN THE SALE DEED T HE AARAJI NO. 1185 OF THIS REGISTRY NOT APPEARED. THEREFORE, THIS IS NOT A PART OF THESE SALES. IN VIEW OF THE ABOVE THE AO WAS JUSTIFIED IN ALLOWING DEDUCTION AT INDEXED COST OF ACQUISITION AT RS.2,62,836/-. 3.4 WE HAVE HEARD BOTH THE PARTIES. AFTER CONSIDERI NG THE SUBMISSIONS OF THE ASSESSEE BEFORE THE LD.CIT(A), WE HOLD THAT THE CON TENTIONS OF THE ASSESSEE ARE ACCEPTABLE. THERE IS NO BASIS OF ADOPTING A RATE OF 10% APPRECIATION. WE THEREFORE, HOLD THAT THE COST OF ACQUISITION SHOULD BE TAKEN AT RS. 72,914/- SUBJECT TO THE FINDING TO BE GIVEN IN APPEAL OF THE REVENUE . 4.0 NOW WE TAKE UP THE GROUNDS OF APPEAL OF THE RE VENUE. 5.1 THE FIRST GROUND OF APPEAL OF THE REVENUE IS AG AINST RELIEF ALLOWED BY THE LD.CIT(A) IN RESPECT OF CONSIDERATION TO BE CONSID ERED U/S 48 OF THE I.T. ACT 5.2 THIS ISSUE HAS BEEN CONSIDERED BY US WHILE DISP OSING OFF THE APPEAL OF THE ASSESSEE. FOLLOWING OUR FINDING IN THE APPEAL FILE D BY THE ASSESSEE, WE HOLD THAT THE LD.CIT(A) WAS JUSTIFIED IN DIRECTING THE AO TO ADOP T THE SALE CONSIDERATION OF RS. 17,35,301/-. 12 6.1 THE SECOND GROUND OF APPEAL OF THE REVENUE IS T HAT THE LD.CIT(A) HAS ERRED IN TREATING THE SALE CONSIDERATION AT NIL FOR THE LAND MEASURING 0.3754 HECTARE AS TWO REGISTRIES WERE NOT PRODUCED BEFORE THE AO. 6.2 THE LD.CIT(A) IN PARA 37 OF HIS ORDER HAS OBSER VED THAT THE ASSESSEE HAS NOT SOLD THE ENTIRE PROPERTY. THE LAND MENTIONED IN ARAJI NO . 1838 HAS NOT BEEN SOLD. THE AO HAS ALSO NOT COLLECTED ANY MATERIAL TO SHOW THAT THE AS SESSEE HAS SOLD ENTIRE PROPERTY. 6.3 BEFORE US, THE REVENUE HAS NOT PLACED ANY EVIDE NCE TO SHOW THAT THE ASSESSEE HAS SOLD ENTIRE LAND. WE THEREFORE, FEEL THAT THE LD.CI T(A) WAS JUSTIFIED IN CONSIDERING THE CAPITAL GAIN IN RESPECT OF LAND TO THE EXTENT OF 0 .6696 HECTARE AND THUS THE GROUND NO. 2 OF THE REVENUE IS DISMISSED. 7.1 THE THIRD GROUND OF THE REVENUE IS THAT THE LD. CIT(A) HAS ERRED IN HOLDING THAT THE EXPENDITURE INCURRED FOR THE REGISTRY AND STAMP WER E NOT INCURRED BY THE ASSESSEE BUT INCURRED BY THE POWER OF ATTORNEY HOLDER OUT OF SAL E CONSIDERATION. 7.2 IN THE GROUND OF APPEAL, IT IS MENTIONED THAT T HE ASSESSEE HAS DEPOSITED THE ENTIRE SALE CONSIDERATION OF RS. 7.51 LACS IN HIS SAVING B ANK ACCOUNT. THERE IS NO WITHDRAWAL FROM THE BANK ACCOUNT EXCEPT FOR BOND OF RS. 4.00 L ACS. THIS ISSUE HAS BEEN CONSIDERED BY THE AO AT PAGES 8 AND 9 OF THE ASSESSMENT ORDER. IT IS NOWHERE MENTIONED THAT THE ASSESSEE DEPOSITED ENTIRE SALE CONSIDERATION AND TH EREFORE, THE EXPENSES WERE MADE OUT OF UNDISCLOSED INCOME. THE FACT THAT THE AMOUNT OF RS. 7.51 LACS STANDS DEPOSITED IN THE BANK ACCOUNT HAS NOT BEEN MENTIONED BEFORE THE LD.C IT(A). THUS THE REVENUE HAS RAISED THE ADDITIONAL EVIDENCE IN THE GROUND OF APPEAL. TH ERE HAS BEEN NO QUERY ON THIS ISSUE BY THE AO DURING THE COURSE OF ASSESSMENT PROCEEDINGS. WE HAVE DECIDED THE ISSUE ON THE BASIS OF THE FACTS GIVEN BEFORE THE AO OR BEFORE TH E LD.CIT(A). THE DOCUMENTARY 13 EVIDENCE SUGGESTS THAT COST OF REGISTRY AND STAMPS WAS BORNE BY THE SELLER OUT OF SALE CONSIDERATION. 8.1 THE LAST GRIEVANCE OF THE REVENUE IS THAT THE L D.CIT(A) HAS ERRED IN ADOPTING THE INDEXED COST OF ACQUISITION AT RS. 2,62,836/- WHICH IS THE COST OF ENTIRE OF 1.045 HECTARE AS AGAINST SALE CONSIDERATION TAKEN BY FOR 0.6696 HECT ARE ONLY. 8.2 THE LD.CIT(A) HAS TAKEN THE COST OF ACQUISITION AS MENTIONED BY THE AO IN HIS ORDER. IN CASE THE COST OF ACQUISITION HAS BEEN TAK EN BY THE AO FOR THE ENTIRE LAND OF 1.045 HECTARE ON THE GROUND THAT HE HAS CONSIDERED THE SA LE OF ENTIRE LAND THEN THE COST OF ACQUISITION IS TO BE TAKEN FOR 0.6696 HECTARE BECAU SE IT IS BEING HELD THAT CAPITAL GAIN IS ARISING FROM 0.6696 HECTARE OF LAND. HENCE, THIS IS SUE IS RESTORED BACK ON THE FILE OF THE AO AND THE AO WILL PROVIDE OPPORTUNITY TO THE ASSES SEE ON THIS ISSUE THAT ACQUISITION OF RS. 72,914/- IS FOR THE ENTIRE LAND OR LAND SOLD 9.0 IN THE RESULT, THE APPEALS OF THE ASSESSEE AS W ELL AS REVENUE ARE PARTLY ALLOWED THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 09-1 2-2011 SD/- SD/- (R.K. GUPTA) (N.L. KALRA) JUDICIAL MEMBER ACCOUNTANT MEMBER JODHPUR DATED: 09 /12/2011 `MISHRA COPY TO: 1. SHRI HANUMANT KUMAR TALESARA, UDAIPUR 2. THE ITO, WARD- 2(1), UDAIPUR 3.THE LD. CIT (A) BY ORDER 4.THE CIT 5.THE D/R 6.THE GUARD FILE (ITA NO.383/08) A.R.. ITAT: JODHPUR 14