LATE SHRI DHAN SINGH BHATI L/H NEHA BHATI, Ajmer V. INCOME TAX OFFICER, Ajmer

ITA 384/JPR/2018

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 3304 (ITAT-JAIPUR)
• Duration Of Justice: 10 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-02-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 2006-2007
• Appeal Filed On: 23-03-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: PB D VIHYKFKHZ IZRFKHZ
• Assessee Lawyers: AJAY SOMANI CA SMT
• Keywords: Maximum Marginal Rate; Cost of acquisition; Valuation report
• Section: 143(3); 131; 148

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENC H B JAIPUR JH FOT; IKY JKO] U;KF;D LNL; ,OA JH FOE FLAG ;KNO] YS[KK LNL; DS LE{K BEFORE: SHRI VIJAY PAL RAO, JM & SHRI VIKRA M SINGH YADAV, AM VK;DJ VIHY LA- @ ITA NO. 384/JP/2018 FU/KZKJ.K O'K Z @ ASSESSMENT YEAR : 2006-07 LATE SHRI DHAN SINGH BHATI, (THROUGH LEGAL HEIR SMT NEHA BHATI) AJMER CUKE VS. CIT, CIRCLE-1, AJMER LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: ABYPB9085D VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ L S@ ASSESSEE BY : SHRI AJAY SOMANI (CA) JKTLO DH VKSJ LS @ REVENUE BY : SMT. ROSHANTA MEENA (JCIT) LQUOKBZ DH RKJH[ K@ DATE OF HEARING : 13/11/2018 MN?KKS'K.KK DH RKJH[ K@ DATE OF PRONOUNCEMENT: 11/02/2019 VKNS'K@ ORDER PER: VIKRAM SINGH YADAV, A.M. THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF LD. CIT(A), AJMER DATED 26.02.2018. AT THE OUTSET, IT IS NOTED THAT THIS IS THE 2 ND ROUND OF APPELLATE PROCEEDINGS BEFORE THE TRIBUNAL. IN THE E ARLIER ROUND, THE CO-ORDINATE BENCH VIDE ITS ORDER DATED 23.09.2016 I N ITA NO.94/JP/2014 READ WITH ORDER PASSED IN MA NO. 178/JP/2016 DATED 08.03 .2017 HAS HELD AS UNDER:- WE HAVE HEARD RIVAL CONTENTIONS, PERUSED THE MATER IAL AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITI ES BELOW. ADMITTEDLY THIS ISSUE DOES NOT ARISE FROM THE IMPUGNED ORDER. IN EARLIER ROUND OF LITIGATION, LEARNED CIT(A) HAD DIRECTED THE AO TO R EVISE THE VALUE OF THE PROPERTY A AND WHEN REVISED BY THE IG(STAMPS). THE AO IN PURSUANCE OF THAT ORDER, REVISED THE VALUE OF THE PROPERTY. I T IS ALSO NOT IN DISPUTE THAT THE ASSESSEE HAD NOT CHALLENGED THE ORDER DATE D 28.03.2011. ITA NO. 384-JP-2018 LATE SH RI DHAN SINGH BHATI, AJMER VS. ITO, AJMER 2 HENCE THE SUBJECT MATTER OF THE ASSESSMENT WAS TO T HE EXTENT OF VALUATION OF PROPERTY, AND NOT THE OWNERSHIP OF THE PROPERTY. BUT IT IS ALSO A SETTLE POSITION OF LAW THAT IF A PERSON IS N OT LIABLE FOR TAX, MERELY BECAUSE HE HAS NOT CLAIMED OTHERWISE, THAT SHOULD N OT GIVE LICENSE TO THE ASSESSING AUTHORITY TO MAKE THE PERSON LIABLE F OR THE ENTIRE VALUE OF THE PROPERTY. THE ASSESSEE HAS NOT FILED COPY OF TH E WILL DATED 26.09.1996. THEREFORE, IN THE INTEREST OF NATURAL J USTICE, WE DEEM IT PROPER TO RESTORE THE ISSUE OF OWNERSHIP OF THE PRO PERTY AND LIABILITY OF THE ASSESSEE, TO THE FILE OF AO FOR FRESH DECISION. IN THE EVENT THE AO FINDS THAT THE OWNERSHIP OF THE ENTIRE PROPERTY I.E . NANKI BHAWAN, AT PRAKASH ROAD, NAGRA, AJMER WAS BEQUEATHED BY THE FA THER OF THE ASSESSEE IN FAVOUR OF THE ASSESSEE, HE WOULD DECIDE THE ISSUE ACCORDINGLY AS THE OWNER OF THE ENTIRE PROPERTY. HO WEVER, IN CASE HE FINDS OTHERWISE IN TERMS OF THE WILL RELATED TO THI S PROPERTY, HE WOULD CONSIDER THE SAME AND DECIDED ACCORDINGLY. THE ASSESSING OFFICER IS FURTHER DIRECTED TO CONSID ER THE CLAIM OF INDEXATION OF THE ASSESSEE AS PER LAW. 2. IN THE SET-ASIDE PROCEEDINGS, FROM THE PERUSAL O F THE SALE DEED DATED 09.09.2005, THE ASSESSING OFFICER HAS HELD THAT THE ASSESSEE, LATE SHRI DHAN SINGH IS ONLY OWNER OF THE IMPUGNED PROPERTY. THERE FORE, THE CONTENTION OF THE LD. AR THAT LATE SHRI DHAN SINGH HAS ONLY 50% S HARE OF THE IMPUGNED PROPERTY AND INCOME BE SO COMPUTED IN SUPPORT OF HI S 50% OWNERSHIP OF THE SAID PROPERTY WAS NOT FOUND ACCEPTABLE. 3. REGARDING CLAIM OF COST OF INDEXATION IN THE HA NDS OF THE PREVIOUS OWNER, THE ASSESSING OFFICER REJECTED THE VALUATION REPORT SUBMITTED BY THE LEGAL HEIR OF THE ASSESSEE IN SUPPORT OF COST OF CO NSTRUCTION IN HANDS OF THE ITA NO. 384-JP-2018 LATE SH RI DHAN SINGH BHATI, AJMER VS. ITO, AJMER 3 PREVIOUS OWNER FOR THE REASONS STATED IN THE ASSESS MENT ORDER AND HAD DETERMINED COST OF LAND AND COST OF CONSTRUCTION AT RS. 10,22,700/- AND AFTER INDEXATION, THE SAME WAS DETERMINED AT RS. 38,21,66 9/-. IN THIS REGARD, THE RELEVANT FINDINGS OF THE ASSESSING OFFICER ARE REPR ODUCED AS UNDER:- FROM THE PLAIN READING OF THE STATEMENT DEPOSED BY THE APPROVED VALUER, THE FOLLOWING POINTS EMERGED- 1. THAT THE APPROVED VALUER HAS MADE THE VALUATION OF ENTIRE PROPERTY KNOWN AS NANKI BHAWAN, PRAKASH ROAD NAGRA, AJMER I.E. 1048.87 SQ. MTR (11290.003 SQ FT.). 2. THAT IN THE SALE DEED IT IS MENTIONED IN THE DES CRIPTION OF PROPERTY SOLD ON 9-9-2005 AT PAGE NO. 10 THAT OUT O F 11290 SQ. FT> THE CONSTRUCTION OF 1625 SQ FT. HAD ALREADY BEEN MA DE 80-85 YEARS BACK BY THE SELLERS TO THE PREVIOUS OWNER IN THE FY 1985-86. THAT MEANS THE ASSESSEE IS NOT ENTITLE TO CLAIM OF INDEX ATION U/S 49(1) OF THE CONSTRUCTION COST OF THE BUILDING WHICH WERE CO NSTRUCTED BY SELLER TO THE PREVIOUS OWNER THAT TOO INCURRED 80-85 YEARS BACK. THE ASSESSEE IS ONLY ENTITLE TO GET BENEFIT OF INDEXATI ON WHERE ONLY THE PREVIOUS OWNER HAS INCURRED ANY EXPENDITURE. 3. AS REGARDS THE BASIS OF WHOLE CONSTRUCTION IN THE FINANCIAL YEAR 1985-86, THE VALUER HAS DEPOSED THAT HE HAS NOT BEE N PROVIDED ANY DETAILS LIKE CONSTRUCTION AGREEMENT WITH CONTRACTOR , BILLS AND VOUCHERS ETC. IT HAS ALSO BEEN DEPOSED BY HIM THAT AS THE AS SESSEE AND HIS CA APPROACHED HIM TO MAKE VALUATION OF THE SAME ONLY F OR FY 1985-86 OF THE IMPUGNED ENTIRE PROPERTY AND ALSO KNOWN TO HIM THAT THE PREVIOUS OWNER OF THE SAID PROPERTY BOOKED RS. 24-25 LACS AS COST OF CONSTRUCTION IN HIS BOOKS OF A/C, THOUGH SUCH VERIF ICATION WAS NOT MADE AVAILABLE TO THE APPROVED VALUER BEING NOT CONCERNE D WITH THAT. ITA NO. 384-JP-2018 LATE SH RI DHAN SINGH BHATI, AJMER VS. ITO, AJMER 4 4. IT HAS ALSO BEEN DEPOSED BY THE VALUER, THAT AS PER INSTRUCTION OF THE CLIENT HE MADE THE VALUATION OF SUCH PROPERTY O NLY FOR FY 1985-86, MADE IN DEC. 2017 . 5. IT HAS ALSO BEEN DEPOSED THAT CLIENT HAS NOT INS TRUCTED HIM TO MAKE THE VALUATION OF THE PROPERTY WHICH WAS ALLEGE DLY CONSTRUCTED ONLY IN 1985-86 BUT HAS INSTRUCTED HIM TO MAKE VALU ATION OF THE ENTIRE PROPERTY BEFORE SALE IN 2005-06. CONSIDERING THE ABOVE FACTS AND CIRCUMSTANCES OF TH E CASE, THE FOLLOWING POINT EMERGED WHICH ARE MENTIONED BELOW: 1. THAT THE DEPARTMENT IS READY TO GIVE BENEFIT OF INDEXATION U/S 49(1) OF THE I.T. ACT AS PER DIRECTIONS OF THE HONB 'E ITAT, BUT THE ONUS IS ON THE ASSESSEE TO PROVE THE COST OF LAND AS WEL L AS IMPROVEMENT WHICH THE PREVIOUS OWNER IN THIS CASE HAD MADE. THE ASSESSEE HAS ONLY PROVIDED THE COPY OF PURCHASED REGISTRY OF LAND AND PART CONSTRUCTIONS FROM 11 SELLERS IN THE YEAR 1985-86 AMOUNTING TO RS . 1,32,000/- ONLY FOR WHICH THE ASSESSEE IS ENTITLE TO CLAIM BENEFIT OF INDEXATION FROM THE YEAR IN WHICH THE PREVIOUS OWNER ACQUIRED IT. 2. FURTHER AS REGARD THE COST OF CONSTRUCTION, THE ASSESSEE CLAIMED IT FROM FY 1996-97 AT RS. 23,45,290/- WHILE FILING THE RETURN FOR AY 2006- 07 FOR THE FIRST TIME ON THE BASIS OF PROPERTIES TR ANSFERRED IN THE NAME OF THE ASSESSEE IN 1996-97 AND CLAIMED INDEXATION T HEREOF AT RS. 38,21,669/-. THE REPLY OF THE ASSESSEE THAT WHILE F ILING THE RETURN FOR A.Y 2006-07, THE ASSESSEE WRONGLY CLAIMED THE INDEX ATION FROM THE YEAR 1996-97 RATHER IT WOULD HAVE BEEN CLAIMED FRO M AY 1985-86. SINCE THE ASSESSEE HAS NOT HAVING ANY DOCUMENTARY E VIDENCE OF THE COST OF SUCH PROPERTY IN FY 1985-86 AT RS. 23,45,29 0/- (CLAIMED FROM FY 1996-97) IN THE RETURN FILED FOR A.Y 2006-07 EXCEPT THE COST OF LAND AT RS. 1,32,000/-, IT IS NOT POSSIBLE FOR THE AO TO DE TERMINE THE COST OF ITA NO. 384-JP-2018 LATE SH RI DHAN SINGH BHATI, AJMER VS. ITO, AJMER 5 CONSTRUCTION OF RS. 22,13,290/- (23,45,290/-(-) COS T OF LAND 1,32,000/-) PARTICULARLY IN THE FACTS AND CIRCUMSTANCES THAT TH E ASSESSEE IS NOT HAVING ANY BOOK ENTRY IN THE BOOKS OF PREVIOUS OWNE R, DOCUMENTARY PROOF OF INVESTMENT OF RS. 22,13,290/- IN THE FY 19 85-86, ANY CONSTRUCTION AGREEMENT WITH CONTRACT, BILLS AND VOU CHERS OF INVESTMENT AND MORE PARTICULARLY ANY VALUATION DONE IMMEDIATEL Y AFTER ITS CONSTRUCTION IN THE YEAR 1985-86. 3. THERE IS NO DOUBT THAT AFTER 1985-86, IT IS NO P OSSIBLE THAT NO FURTHER RENOVATIONS, FITTINGS OR CONSTRUCTION WAS M ADE IN BETWEEN 1985-86 TO 2006-07. HOWEVER, THE APPROVED VALUER AS INSTRUCTED BY THE AFORESAID CLIENT ASSESSEE, HE MADE THE ENTIRE P ROPERTY VALUED IN DEC. 2017 AS PER EXISTING BUILDING. 4. THUS THE VALUATION REPORT SUBMITTED BY THE ASSES SEE WHICH IS HAVING NUMBER OF DOUBTS OF THE YEAR OF CONSTRUCTION , WITHOUT ANY MATERIAL EVIDENCE AND ONLY MADE ON THE ASSERTION MA DE BY THE ASSESSEE, HE VALUED THE SAME AS PER CPWD RATES FIXE D AS ON 1.4.1976. THE VALUER HAS ALSO STATED THAT HE HAS NO OPTION TO VALUE THE SAME EXCEPT AS STATED TO HAVE TAKEN THE YEAR OF CONSTRUC TION AS ON 1-4-1986. 5. THE VALUATION REPORT SUBMITTED BY THE ASSESSEE I S APPEARING TOTAL SELF SERVING OF THE ASSESSEE. 6. IT IS ALSO NOT IN DOUBT THAT THE BUILDING CONTAI NS ADDITIONAL ITEMS OF LATEST TECHNOLOGY AS APPEARING THE PHOTO GRAPHS OF WHICH THE VALUER HAS MADE VALUATION IN HIS REPORT AS ADDITIONAL ITEM S. CERTAINLY THESE MIGHT HAVE BEEN FITTED BY THE ASSESSEE OR THE PURCH ASER AFTER PURCHASE THE SAID PROPERTY IN F.Y. 200506 RELEVANT FOR ASSES SMENT YEAR 2006-07 WHICH IS UNDER CONSIDERATION. 7. IN VIEW OF MISLEADING FACTS NARRATED BY THE ASSE SSEE TO VALUER, THE AFORESAID VALUATION REPORT OF THE ASSESSEE CANN OT BE ACCEPTED IN ITA NO. 384-JP-2018 LATE SH RI DHAN SINGH BHATI, AJMER VS. ITO, AJMER 6 TOTO AND FOUND SELF SERVING TO THE ASSESSEE AND BAS ED ON THE FACTS APPRAISED TO HIM ONLY. ACCORDINGLY, THE VALUATION M ADE BY THE APPROVED VALUER IS HEREBY REJECTED. IN VIEW OF FOREGOING DISCUSSION, IT IS OBSERVED, TH AT NOW A QUESTION ARISES THAT WHAT COST WHICH HAVE BEEN INCURRED BY T HE PREVIOUS OWNER LATE SHRI RAM SINGH BHATI, BE ADOPTED IN THE FY 198 5-86. IN THIS CONNECTION BEFORE ANY CONCLUSION, IT IS PERTINENT T O MENTION HERE THAT THE ASSESSEE AND PREVIOUS OWNERS ARE WELL KNOWN BUS INESSMAN OF THE TOWN SINCE VERY LONG AND HAVING THE SERVICES OF VAR IOUS CAS/ LAWYER. THE COST FOR WHICH INDEXATION CLAIMED IN AY 2006-07 FROM 1996-97 AFTER CONSULTING WITH THEM. THE PLEA OF THE ASSESSEE THAT THE ASSESSEE WRONGLY CLAIMED INDEXATION FROM 1996-97 RATHER IT W OULD HAVE BEEN CLAIMED IT FROM F.Y. 1985-86 IS NOT CORRECT. IN FAC T THE ASSESSEE BOOKED THE COST OF LAND AND CONSTRUCTED AS INDEXED VALUE I N THE FY 1996-97 IN WHICH THE PROPERTY WAS INHERITED BY THE ASSESSEE ON LY. THUS IN MY VIEW THE ASSESSEE HAS CORRECTLY TAKEN THE INDEX COST OF THE BUILDING IN THE FY 1996-97 AT RS. 23,45,290/- AND THE AO WHILE PASSING THE ORIGINAL ORDER TAKING THE CORRECT INDEX COST OF BUILDING AT RS. 38 ,21,669/- IN THE YEAR OF SALE I.E. 2005-06 RELEVANT FOR ASSESSMENT YEAR. THEREFORE, IN ABSENCE OF ANY DOCUMENTARY EVIDENCE PRODUCED BY THE ASSESSE E, I AM INCLINED TO DETERMINE THE COST OF LAND AND BUILDING AS INDEX COST CLAIMED IN FY 1996-97 AT RS. 23,45,290/- (TREATING THE COST OF LA ND AND BUILDING IN 1985-86 AT RS. 10,22,700/- BEING REVERSED INDEX VAL UE OF THE SAME) AND TAKEN BY THE AO AT RS. 38,21,669/- IN THE YEAR OF SALE I.E. 2005-06 RELEVANT FOR ASSESSMENT YEAR. 4. ON APPEAL, THE LD. CIT(A) HAS CONFIRMED THE FIN DING OF THE ASSESSING OFFICER AND THE RELEVANT FINDING OF THE LD. CIT(A) ARE AS UNDER:- ITA NO. 384/JP/2018 LATE SHRI DHAN SINGH BHATI, AJMER VS. CIT, CIRCLE-1 , AJMER 7 2.2 I HAVE GONE THROUGH THE ASSESSMENT ORDER, STAT EMENT OF FACTS, GROUNDS OF APPEAL AND WRITTEN SUBMISSION CAREFULLY. IT IS SEEN THAT THE ISSUE OF OWNERSHIP OF THE PROPERTY SOLD WAS RESTORE D BY THE ITAT TO THE FILE OF AO, AS THE APPELLANT HAD NOT FILED COPY OF THE WILL DATED 26.09.1996 BEFORE THE ITAT. THE AO WAS SPECIFICALLY DIRECTED BY THE ITAT TO DECIDE THE ISSUE IN TERMS OF THE WILL REL ATED TO THE PROPERTY. AS THE APPELLANT EITHER BEFORE THE AO OR DURING THE CO URSE OF APPELLATE PROCEEDINGS HAS FAILED TO PRODUCE THE COPY OF THE WILL DATED 26.09.1996, THEREFORE, I FIND NO JUSTIFICATION FOR INTERFERING WITH THE ASSESSMENT COMPLETED BY THE AO. AS FAR AS INDEXATIO N TO THE COST OF ACQUISITION IS CONCERNED, THE APPELLANT HAS NOT FUR NISHED, EITHER BEFORE THE AO OR DURING THE COURSE OF APPELLATE PROCEEDING S ANY EVIDENCE TO SHOW THAT THE PROPERTY WAS CONSTRUCTED IN THE YEAR 1985-86. EVEN THE APPELLANT HIMSELF HAD CLAIMED THE INDEXATION FROM T HE F.Y. 1996-97 IN THE RETURN OF INCOME FILED BY HIM. THEREFORE, THE A CTION OF THE AO ALLOWING INDEXATION FROM THE F.Y 1996-97 IS HELD TO BE VALID AND IN ACCORDANCE WITH THE PROVISIONS OF LAW. 5. NOW THE ASSESSEE THROUGH HER LEGAL HEIR IS IN AP PEAL BEFORE US AND HAS RAISED THE FOLLOWING TWO GROUNDS OF APPEAL:- THAT THE LD. CIT(A) AJMER HAS ERRED IN LAW AND FAC TS IN DISMISSING THE APPEAL AGAINST THE ORDER OF LD. AO (IN CASE REMANDED BY IT AT, JAIPUR ITA NO. 94/JP/2014 AND MA NO. 178/JP/2016 DATED 08.03.2017) 1. GROUND 1 : THAT THE LD. CIT(A) AJMER HAS ERRED IN H OLDING THE DECEASED ASSESSEE AS 100% OWNER OF THE TRANSFERRED PROPERTY DESPITE:- PROBATE ORDER WHICH MENTIONS THAT THE SAME WAS GRAN TED IN FAVOUR OF THE ASSESSEE ON BEHALF OF SELF AND LUNATIC BROTH ER (SH. LAXMAN SINGH BHATI), AND. ITA NO. 384/JP/2018 LATE SHRI DHAN SINGH BHATI, AJMER VS. CIT, CIRCLE-1 , AJMER 8 PAGE NO. 1 OF THE SALE DEED CLEARLY STATES THAT IT HAS BEEN SOLD ON BEHALF OF SELF (ASSESSEE) AND AS A GUARDIAN OF MENT ALLY RETARDED BROTHER (SH. LAXMAN SINGH BHATI) 2. GROUND 2 : THAT THE LD. CIT(A) AJMER HAS ERRED I N CONFIRMING THE ORDER OF LD. AO IN DISREGARD TO THE INSTRUCTIONS OF ITAT BY ARBITRARY CHANGING AND COMPUTING COST OF ACQUISITION AT RS. 10,22,700/- DE SPITE THE FACTS. ERSTWHILE A.O HAD ACCEPTED THE COST OF ACQUISITION AT RS. 23,45,290/- APPROVED VALUERS REPORT ON RECORD (COMPUTING NEW C OST OF CONSTRUCTION AS ON 01.04.1986 AT RS. 25,25,000/-). 6. DURING THE COURSE OF HEARING, THE LD. AR SUBMITT ED THAT THE LD. CIT(A) HAS ERRED IN UPHOLDING THE ORDER OF THE AO WHICH IS CLEARLY IN DISREGARD TO THE REMAND BY THE TRIBUNAL. REGARDING GROUND NO. 1, IT WAS SUBMITTED THAT THE ASSESSEE WAS JOINT (50%) OWNER OF THE SOLD PROPERTY AND THIS FACT IS VERIFIABLE FROM PROBATE ON RECORD AND THE ASSESSEES HEIRS IN ABILITY TO PRODUCE COPY OF WILL OF THE DECEASED LATE SHRI RAM SINGH BHATI SHOU LD BE IGNORED IN LIGHT OF HUMANITARIAN CONSIDERATIONS. REGARDING CLAIM OF IND EXATION, IT WAS SUBMITTED BY THE LD AR THAT THE ASSESSING OFFICER ACCEPTED TH E CONTENTION OF THE ASSESSEE THAT HE IS ENTITLED TO GET INDEXATION FROM THE F.YS 1985-86 WHEN THE PREVIOUS OWNER LATE SHRI RAM SINGH BHATI, ACQUIRED THE IMPUG NED PROPERTY. IN SUPPORT OF THE COST OF ACQUISITION, THE LD. AO AS WELL AS L D. CIT(A) WERE PROVIDED WITH THE COPIES OF THE CAPITAL ACCOUNTS AND BALANCE-SHEE T OF THE ASSESSEE FROM F.Y 1992-93 TO F.Y. 1996-97 TO EVIDENCE THE COST OF THE INHERITED ASSET AS PER BOOKS AT RS. 23,45,290/-. TO SUBSTANTIATE THE CLAIM ED COST OF ACQUISITION, VALUATION REPORT OF APPROVED VALUER WAS SUBMITTED W HEREIN THE VALUATION AS ON 01.04.1986 WAS DETERMINED AT RS. 25,25,000/- AND AP PROVED VALUER SH. DHARMENDRA JAIN ALSO TESTIFIED UNDER SECTION 131 BE FORE THE ASSESSING OFFICER AND HE CONFIRMED THE VALUATION OF RS. 25,25,000/-. IT WAS FURTHER SUBMITTED ITA NO. 384/JP/2018 LATE SHRI DHAN SINGH BHATI, AJMER VS. CIT, CIRCLE-1 , AJMER 9 THAT THE ASCERTAINMENT OF COST OF CONSTRUCTION WAS NOT SUBJECT MATTER OF REMAND BY THE TRIBUNAL. THE AO HAS HIMSELF GIVEN A FINDING THAT THUS FOLLOWING THE DIRECTIONS OF THE ITAT, THE ASSESSEE IS ENTITLED TO GET INDEXATION, I.E. FROM THE YEAR 1985-86 WHEN THE PREVIOUS OWNER LATE SHRI RAM SINGH BHATI, ACQUIRED IT. THE AO FIXED THE INDEXED COST ALLOWED TO APPELLANT AT RS. 38,21,669/- (WORKED BY ERSTWHILE A.O ORDER DATED 29 .12.2009), UNJUDICIALLY AND ARBITRARILY ESTIMATED THE COST OF ACQUISITION AT RS . 10,22,700/- (INSTEAD OF SETTLED COST OF ACQUISITION AT RS. 23,45,290/- ACCE PTED IN 143(3) DATED 29.12.09) WITHOUT ANY FACTUAL BASIS. IN A WAY, THE LD. AO AND LD. CIT(A) ALTHOUGH ACCEPTING THE BENEFIT OF INDEXATION TO BE ALLOWED FROM FY 1985-86 (INDEXED FACTOR 497/133 INSTEAD OF 497/305), ARBITR ARILY REWORKED COA FROM THE INDEXED COA OF RS. 38,62,669/- (WORKED AS PER INDEX FACTOR OF 497/305). IT WAS FURTHER SUBMITTED THAT THE ASSESSEE AND HIS WIF E BOTH HAVE EXPIRED AND THE MARRIED DAUGHTER AND SON SHOULD NOT BE EXPECTED TO ADDUCE EVIDENCE OF COST OF CONSTRUCTION OF PROPERTY IN F.Y 85-86. AT T HE SAME TIME, THE UNDERNOTED EVIDENCES ON RECORD SHOULD SUFFICE IN SUPPORT OF CO ST OF CONSTRUCTION: MENTION IN SALE DEED ENTRIES IN FINAL ACCOUNTS OF DECEASED VALUATION REPORT OF APPROVED VALUER TESTIMONY OF APPROVED VALUER FURTHER, THERE IS NO CAUSE TO DISTURB THE SETTLED F ACT AS REGARDS COST OF ACQUISITION AT RS. 23,45,290/- BY PREVIOUS AO & SUB SEQUENT ORDERS. 7. THE LD DR IS HEARD WHO HAS VEHEMENTLY ARGUED TH E MATTER. REGARDING FIRST GROUND OF APPEAL, THE LD DR SUBMITTED THAT TH E ASSESSEE HAS FAILED TO SUBMIT A COPY OF THE WILL AS SO DIRECTED BY THE T RIBUNAL AND IN ABSENCE OF THE SAME, THERE IS NO INFIRMITY IN THE ORDER OF THE AO AND THE LD CIT(A) CONFIRMING THE SAME. REGARDING CLAIM OF INDEXATION, THE LD DR SUBMITTED THAT VALUATION ITA NO. 384/JP/2018 LATE SHRI DHAN SINGH BHATI, AJMER VS. CIT, CIRCLE-1 , AJMER 10 REPORT SO SUBMITTED BY THE ASSESSEE HAS BEEN RIGHTL Y REJECTED BY THE AO FOR THE DETAILS REASONS GIVEN IN THE ASSESSMENT ORDER AND I N ABSENCE OF ANY CORROBORATIVE EVIDENCE, THE AO HAS RIGHTLY DETERMIN ED THE COST OF ACQUISITION AND HAS ALLOWED THE INDEXATION BENEFIT TO THE ASSES SEE. IT WAS ACCORDINGLY SUBMITTED THAT THERE IS NO INFIRMITY IN THE FINDING S OF THE LD CIT(A) AND HIS ORDER SHOULD BE CONFIRMED. 8. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. SHRI RAM SINGH, FATHER OF THE ASSESSEE H AD PURCHASED THE IMPUNGED PROPERTY IN THE YEAR 1985-86 VIDE 11 PURCHASE REGIS TRIES FROM THE ORIGINAL OWNERS. THEREAFTER, SUBSEQUENT TO DEATH OF SHRI RA M SINGH ON 2.11.2012, IN TERMS OF GRANT OF PROBATE UNDER SECTION 289 OF INDI AN SUCCESSION ACT BY THE ORDER OF DISTRICT AND SESSION JUDGE, AJMER DATED 30 .05.2003, THE ASSESSEE WAS GRANTED THE ADMINISTRATION OF THE IMPUNGED PROPERTY AND OTHER ASSETS IN HIS INDIVIDUAL CAPACITY AND ALSO AS GUARDIAN OF HIS MEN TALLY RETARDED BROTHER LAXMAN SINGH BHATI. A COPY OF THE WILL WRITTEN BY S HRI RAM SINGH HAS NOT BEEN PLACED ON RECORD, HOWEVER, GOING BY THE AFORESAID P ROBATE ORDER, THE ASSESSEE WAS HAVING HALF SHARE IN THE IMPUNGED PROPERTY IN H IS OWN RIGHT AND OTHER HALF IS ALSO HELD BY THE ASSESSEE IN CAPACITY OF LEGAL G UARDIAN FOR HIS MENTALLY RETARDED BROTHER LAXMAN SINGH BHATI. THEREAFTER, TH E ASSESSEE ENTERED INTO A SALE DEED DATED 9.9.2005 FOR THE WHOLE OF THE IMPUN GED PROPERTY REPRESENTING HIMSELF AS WELL AS GUARDIAN OF HIS MENTALLY RETARDE D BROTHER LAXMAN SINGH BHATI. APPARENTLY, THE ASSESSEE WAS HAVING FULL PO SSESSION AND CONTROL OVER THE IMPUNGED PROPERTY AND THERE WAS NO DISPUTE FROM DATE OF GRANT OF PROBATE TILL THE TIME OF ENTERING INTO THE SALE AGREEMENT. FURTHER, THE ASSESSEE HAS COLLECTED THE WHOLE OF THE SALE PROCEEDS AMOUNTING TO RS 27 LACS AND THE DEPOSITED THE SAME IN HIS BANK ACCOUNT. THE ASSESS EE HAS NOT OPENED ANY SEPARATE BANK ACCOUNT IN CAPACITY OF GUARDIAN FOR M ENTALLY RETARDED BROTHER LAXMAN SINGH BHATI AND HAS NOT EVEN SHARED/PARTED W ITH ANY MONEY WITH HIS ITA NO. 384/JP/2018 LATE SHRI DHAN SINGH BHATI, AJMER VS. CIT, CIRCLE-1 , AJMER 11 BROTHER. IN THE RETURN OF INCOME FILED ON 30.10.20 06, THE ASSESSEE HAS DISCLOSED CAPITAL GAINS ON SALE OF THE WHOLE OF THE IMPUNGED PROPERTY AND THE SAME HAS ACCORDINGLY BEEN BROUGHT TO TAX BY THE ASS ESSING OFFICER. IN LIGHT OF ABOVE UNDISPUTED FACTS, IT NEEDS TO BE EXAMINED WHE THER THE ASSESSEE CAN CLAIM THAT HE CAN BE BROUGHT TO TAX ONLY TO AN EXTE NT OF HALF OF HIS SHARE IN THE IMPUNGED PROPERTY AND OTHER HALF SHARE OF THE PROPE RTY WHICH WAS HELD AND SOLD AS GUARDIAN FOR HIS MENTALLY RETARDED BROTHER LAXMAN SINGH BHATI CANNOT BE BROUGHT TO TAX IN HIS HANDS. IN THIS REGARD, W E REFER TO THE PROVISIONS OF SECTION 160 WHICH DEFINES REPRESENTATIVE ASSESSEE IN RESPECT OF INCOME OF A LUNATIC TO MEAN THE GUARDIAN OR THE MANAGER WHO IS ENTITLED TO RECEIVE OR IS IN RECEIPT OF SUCH INCOME ON BEHALF OF SUCH LUNATIC PE RSON. IN THE PRESENT CASE, THE ASSESSEE SATISFIES THE DEFINITION OF REPRESENTA TIVE ASSESSEE AS HE HAS BEEN APPOINTED AS GUARDIAN OF HIS MENTALLY RETARDED (LUN ATIC) BROTHER, HAS ACTED ON HIS BEHALF WHILE EXECUTING THE SALE DEED ON HIS BEH ALF AND THEREAFTER, HAS RECEIVED THE SALE CONSIDERATION ON HIS BEHALF FOR H IS SHARE IN THE PROPERTY. SECTION 160 FURTHER PROVIDES THAT EVERY REPRESENTAT IVE ASSESSEE SHALL BE DEEMED TO BE AN ASSESSEE FOR THE PURPOSES OF THIS A CT. ALL OBLIGATIONS, DUTIES, RESPONSIBILITIES AND LIABILITIES WHICH LIE IN RESPE CT OF AN ASSESSEE WILL LIE IN RESPECT OF REPRESENTATIVE ASSESSEE AS EXPLAINED FUR THER IN SECTION 161 WHICH READS AS UNDER: 161. (1) EVERY REPRESENTATIVE ASSESSEE, AS REGARDS THE INCOME IN RESPECT OF WHICH HE IS A REPRESENTATIVE ASSESSEE, S HALL BE SUBJECT TO THE SAME DUTIES, RESPONSIBILITIES AND LIABILITIES AS IF THE INCOME WERE INCOME RECEIVED BY OR ACCRUING TO OR IN FAVOUR OF HIM BENE FICIALLY, AND SHALL BE LIABLE TO ASSESSMENT IN HIS OWN NAME IN RESPECT OF THAT INCOME; BUT ANY SUCH ASSESSMENT SHALL BE DEEMED TO BE MADE UPON HIM IN HIS REPRESENTATIVE CAPACITY ONLY, AND THE TAX SHALL, SU BJECT TO THE OTHER PROVISIONS CONTAINED IN THIS CHAPTER, BE LEVIED UPO N AND RECOVERED FROM ITA NO. 384/JP/2018 LATE SHRI DHAN SINGH BHATI, AJMER VS. CIT, CIRCLE-1 , AJMER 12 HIM IN LIKE MANNER AND TO THE SAME EXTENT AS IT WOU LD BE LEVIABLE UPON AND RECOVERABLE FROM THE PERSON REPRESENTED BY HIM. (1A) NOTWITHSTANDING ANYTHING CONTAINED IN SUB-SECT ION (1), WHERE ANY INCOME IN RESPECT OF WHICH THE PERSON MENTIONED IN CLAUSE (IV) OF SUB- SECTION (1) OF SECTION 160 IS LIABLE AS REPRESENTATIVE ASSESSEE CONSISTS OF, OR INCLUDES, PROFITS AND GAINS OF BUSINESS, TAX SHA LL BE CHARGED ON THE WHOLE OF THE INCOME IN RESPECT OF WHICH SUCH PERSON IS SO LIABLE AT THE MAXIMUM MARGINAL RATE : PROVIDED THAT THE PROVISIONS OF THIS SUB-SECTION SHALL NOT APPLY WHERE SUCH PROFITS AND GAINS ARE RECEIVABLE UNDER A TRUST DECLARED BY ANY PERSON BY WILL EXCLUSIVELY FOR THE BENEFIT OF ANY R ELATIVE DEPENDENT ON HIM FOR SUPPORT AND MAINTENANCE, AND SUCH TRUST IS THE ONLY TRUST SO DECLARED BY HIM. (2) WHERE ANY PERSON IS, IN RESPECT OF ANY INCOME, ASSESSABLE UNDER THIS CHAPTER IN THE CAPACITY OF A REPRESENTATIVE ASSESSE E, HE SHALL NOT, IN RESPECT OF THAT INCOME, BE ASSESSED UNDER ANY OTHER PROVISION OF THIS ACT. 9. IN THE PRESENT CASE, THE ASSESSEE BY SUBMITTING HIS RETURN OF INCOME WHERE HE HAS DISCLOSED THE WHOLE OF THE SALE CONSID ERATION AND OFFERED THE SAME FOR CAPITAL GAINS TAX HAS EFFECTIVELY AND IN S UBSTANCE COMPLIED WITH THE REQUIREMENTS OF SECTION 160(2) OF THE ACT. IN OTHE R WORDS, THE ASSESSEE HAS DISCLOSED HIS HALF SHARE IN THE IMPUNGED PROPERTY A ND ANOTHER HALF IN CAPACITY OF REPRESENTATIVE ASSESSEE FOR HIS BROTHER AND THE ASSESSMENT HAS BEEN COMPLETED IN NAME OF THE ASSESSEE ONLY BUT AT THE S AME TIME, SUCH ASSESSMENT SHALL BE DEEMED TO BE MADE UPON HIM IN HIS INDIVIDU AL CAPACITY AS WELL AS IN REPRESENTATIVE CAPACITY. FURTHER, IN TERMS OF SECTI ON 162, EVERY REPRESENTATIVE ASSESSEE WHO, AS SUCH, PAYS ANY SUM UNDER THIS ACT, SHALL BE ENTITLED TO RECOVER THE SUM SO PAID FROM THE PERSON ON WHOSE BE HALF IT IS PAID, OR TO RETAIN OUT OF ANY MONEYS THAT MAY BE IN HIS POSSESSION OR MAY COME TO HIM IN HIS ITA NO. 384/JP/2018 LATE SHRI DHAN SINGH BHATI, AJMER VS. CIT, CIRCLE-1 , AJMER 13 REPRESENTATIVE CAPACITY, AN AMOUNT EQUAL TO THE SUM SO PAID. IN THE PRESENT CASE, THE ASSESSEE IS IN POSSESSION OF THE WHOLE OF THE SALE CONSIDERATION RECEIVED ON BEHALF OF HIS BROTHER AND THEREFORE, TH E TAX LIABILITY ARISING IN RESPECT OF HIS SHARE OF PROFITS CAN BE ADJUSTED FRO M THE AMOUNT SO RETAINED BY THE ASSESSEE. IN LIGHT OF ABOVE DISCUSSIONS, WE A RE OF THE CONSIDERED VIEW THAT THE ASSESSEE CANNOT CLAIM THAT HE CAN BE BROUG HT TO TAX ONLY TO AN EXTENT OF HALF OF HIS SHARE IN THE IMPUNGED PROPERTY AND O THER HALF SHARE OF THE PROPERTY WHICH WAS HELD AND SOLD AS GUARDIAN FOR HI S MENTALLY RETARDED BROTHER LAXMAN SINGH BHATI CANNOT BE BROUGHT TO TAX IN HIS HANDS. IN OUR VIEW, THE ASSESSING OFFICER HAS RIGHTLY BROUGHT THE WHOLE OF THE SALE CONSIDERATION IN RESPECT OF SALE OF THE IMPUNGED PROPERTY IN THE HAN DS OF THE ASSESSEE IN HIS INDIVIDUAL CAPACITY TO THE EXTENT OF HIS HALF SHARE AND IN CAPACITY OF REPRESENTATIVE ASSESSEE FOR HIS BROTHER LAXMAN SING H BHATI IN RESPECT OF BALANCE HALF SHARE AS THE ASSESSEE HAS BEEN APPOINT ED AS GUARDIAN OF HIS MENTALLY RETARDED (LUNATIC) BROTHER, HAS ACTED ON H IS BEHALF WHILE EXECUTING THE SALE DEED AND THEREAFTER, HAS RECEIVED THE SALE CON SIDERATION ON HIS BEHALF FOR HIS SHARE IN THE PROPERTY AS WELL. IN THE RESULT, THE GROUND NO. 1 OF THE ASSESSEES APPEAL IS DISMISSED. 10. NOW COMING TO SECOND GROUND OF APPEAL RELATING TO CLAIM OF COST OF ACQUISITION, THE COORDINATE BENCH HAS DIRECTED THAT THE ASSESSING OFFICER IS FURTHER DIRECTED TO CONSIDER THE CLAIM OF INDEXATIO N OF THE ASSESSEE AS PER LAW. THE SAID DIRECTIONS WERE ISSUED IN CONTEXT OF ASSES SEES ORIGINAL GROUND OF APPEAL THAT SINCE THE ASSESSEE HAS INHERITED THE IM PUNGED PROPERTY FROM HIS LATE FATHER SHRI RAM SINGH, THE INDEXATION BENEFIT ON COST OF ACQUISITION SHOULD BE ALLOWED FROM THE YEAR IN WHICH HIS LATE FATHER H AS PURCHASED AND CONSTRUCTED THE PROPERTY AND NOT FROM THE YEAR IN W HICH THE ASSESSEE INHERITED THE PROPERTY. THE SAID DIRECTIONS CANNOT BE READ AN D UNDERSTOOD ONLY IN THE LIMITED CONTEXT OF DETERMINING THE INDEXING FACTOR FOR THE YEAR IN WHICH ITA NO. 384/JP/2018 LATE SHRI DHAN SINGH BHATI, AJMER VS. CIT, CIRCLE-1 , AJMER 14 PREVIOUS OWNER PURCHASED/CONSTRUCTED THE PROPERTY. HOWEVER, THE SAID DIRECTIONS HAVE TO BE READ AND UNDERSTOOD TO DETERM INE THE COST OF ACQUISITION/CONSTRUCTION BY THE PREVIOUS OWNER AND THEN DETERMINING THE RELEVANT INDEXING FACTOR RELATIVE TO YEAR OF PURCHA SE/CONSTRUCTION. 11. IN THE RETURN OF INCOME, THE ASSESSEE HAS SHOWN INDEXED COST OF ACQUISITION AT RS 38,21,669 (F.Y 1996-97 - 23,45,29 0/305*497) AND IN THE ORIGINAL ASSESSMENT ORDER PASSED U/S 148 R/W 143(3) , WE FIND THAT THERE IS NO DISCUSSION REGARDING SUCH COST OF ACQUISITION AND T HE SAME HAS BEEN ACCEPTED AS REFLECTED AND CLAIMED BY THE ASSESSEE IN HIS RET URN OF INCOME. IT IS ASSESSEES CONTENTION THAT HE HAD BY MISTAKE TAKEN INDEXATION FACTOR FOR FINANCIAL YEAR 1996-97 INSTEAD OF FINANCIAL YEAR 19 85-86 AND THE SAME SHOULD BE ALLOWED TO BE RECTIFIED. AND AS FAR AS COST OF ACQUISITION IS CONCERNED, THERE WAS NO DISPUTE AND THERE IS NO BASIS FOR THE AO TO CHALLENGE THE SAME IN THE SET-ASIDE PROCEEDINGS. IN OUR VIEW, IT IS NO DOUB T TRUE THAT IN THE ORIGINAL PROCEEDINGS, THE AO HAS NOT DISPUTED THE COST OF AC QUISITION BUT ONCE THE ASSESSEE TOOK A SPECIFIC GROUND BEFORE THE CO-ORDIN ATE BENCH AND THE LATTER DIRECTED THE AO TO CONSIDER THE CLAIM OF INDEXATION AS PER LAW, THE ISSUE IS WIDE OPEN BEFORE THE AO TO DETERMINE THE COST OF ACQUISI TION IN THE HANDS OF THE PREVIOUS OWNER AND THEREAFTER APPLYING THE RELEVANT INDEXATION FACTOR. 12. NOW, IN TERMS OF COST OF ACQUISITION IN HANDS O F THE PREVIOUS OWNER, THE ASSESSEE HAS SUBMITTED THAT THE PREVIOUS OWNER LATE SHRI RAM SINGH BHATI HAS ACQUIRED THE IMPUNGED PROPERTY THROUGH 11 PURCHASE REGISTRIES IN FINANCIAL YEAR 1985-86 FOR RS 1,32,000. THE SAME HAS BEEN ACCEPTE D BY THE ASSESSING OFFICER IN THE SET-ASIDE PROCEEDINGS AND THERE IS THUS NO D ISPUTE IN THIS REGARD AND THE ASSESSEE IS THUS ELIGIBLE FOR INDEXED COST OF ACQUI SITION BY APPLYING INDEXATION FACTOR FOR FINANCIAL YEAR 1985-86 ON SUCH COST OF A CQUISITION. ITA NO. 384/JP/2018 LATE SHRI DHAN SINGH BHATI, AJMER VS. CIT, CIRCLE-1 , AJMER 15 13. IN TERMS OF COST OF CONSTRUCTION IS CONCERNED, THE ASSESSEE HAS SUBMITTED AN APPROVED VALUERS REPORT WHO HAS DETERMINED THE COST OF CONSTRUCTION AS ON 1.4.1986 AT RS 25,25,000. DURING THE COURSE OF ASS ESSMENT PROCEEDINGS, THE STATEMENT OF APPROVED VALUER WAS RECORDED AND THERE AFTER, THE ASSESSING OFFICER HAS REJECTED THE SAID VALUATION REPORT AS A SELF-SERVING DOCUMENT. IN OUR VIEW, IT WOULD HAVE BEEN MORE APPROPRIATE THAT ONCE THE ASSESSEE HAS FURNISHED A COPY OF THE VALUATION REPORT, THE ASSES SING OFFICER, NOT BEING A TECHNICAL PROFICIENT PERSON IN THE FIELD OF VALUATI ON, SHOULD HAVE REFERRED THE MATTER TO THE DVO AND SOUGHT THE LATTERS REPORT. HOWEVER, THE ASSESSING OFFICER HAS DECIDED TO EXAMINE THE REPORT BY HIMSEL F AND HAS EVEN CALLED THE APPROVED VALUER AND HIS STATEMENT WAS ALSO RECORDED . GIVEN THAT THE MATTER PERTAINS TO A.Y 2006-07 AND THIS IS THE SECOND ROUN D OF APPELLATE PROCEEDINGS AND THAT TOO, REPRESENTED BY THE LEGAL HEIR OF THE ASSESSEE, WE BELIEVE THAT NO USEFUL PURPOSE WOULD BE SERVED IN REMANDING THE MAT TER BACK TO THE AO AND TO GIVE A FRESH INNINGS TO BOTH THE PARTIES BESIDES IN VOLVEMENT OF ADDITIONAL TIME AND COST. IN THE PECULIAR FACTS AND CIRCUMSTANCES OF THE PRESENT CASE, WE THEREFORE DEEM IT APPROPRIATE TO REFER TO OBJECTION S RAISED BY THE ASSESSING OFFICER WITH REGARD TO VALUATION REPORT SO SUBMITTE D BY THE ASSESSEE AND THE ASSESSEES SUBMISSIONS IN THIS REGARD. 14. FIRST MAJOR OBJECTION OF THE ASSESSING OFFICER RELATES TO CONSTRUCTED AREA OF THE PROPERTY WHICH IS CONSTRUCTED BY THE PREVIOU S OWNER LATE SHRI RAM SINGH FROM WHOM THE ASSESSEE INHERITED THE PROPERTY ALONG WITH HIS BROTHER. AS PER ASSESSING OFFICER, THE APPROVED VALUER HAS TAKEN TH E CONSTRUCTED AREA AS 11290 SQ. FTS WHEREAS THE FACT AS APPARENT FROM THE SALE DEED IS THAT 1625 SQ.FT WAS ALREADY CONSTRUCTED 80-85 YEARS BACK WHEN THE PREVI OUS OWNER LATE SHRI RAM SINGH ACQUIRED THE PROPERTY IN FINANCIAL YEAR 1985- 86. WE FIND MERIT IN THE OBJECTIONS SO RAISED BY THE ASSESSING OFFICER AS TH E SAME IS VERY MUCH APPARENT FROM THE VALUATION REPORT AND THE SALE DEED AND TO THIS EXTENT, THE VALUATION OF ITA NO. 384/JP/2018 LATE SHRI DHAN SINGH BHATI, AJMER VS. CIT, CIRCLE-1 , AJMER 16 THE CONSTRUCTED PROPERTY NEEDS TO BE REDUCED AND BR OUGHT DOWN TO CONSTRUCTED AREA WHICH IS ACTUALLY BUILT BY THE PRE VIOUS OWNER LATE SHRI RAM SINGH SUBSEQUENT TO YEAR OF ACQUISITION IN FINANCIA L YEAR 1985-86. SECOND MAJOR OBJECTION OF THE ASSESSING OFFICER RELATES TO YEAR OF CONSTRUCTION. IN THIS REGARD, THE CASE OF THE ASSESSING OFFICER IS THAT T HE APPROVED VALUER HAS JUST GONE BY THE STATEMENT OF THE LEGAL HEIR AND HER CHA RTERED ACCOUNTANT AND HAS DETERMINED THE YEAR OF CONSTRUCTION AS 1985-86. PE R CONTRA, THE ASSESSEE HAS SUBMITTED THAT IN THE SALE DEED, IT IS CLEARLY MENT IONED THAT THERE WAS CONSTRUCTION OF 9665 SQ FT BY LATE SHRI RAM SINGH, THE PREVIOUS OWNER 18 YEARS AGO AND THEREFORE, ONCE THE SALE DEED HAS BEEN ACCE PTED AS AN EVIDENCE OF SALE OF THE IMPUNGED PROPERTY, THE AVERMENTS MENTIO NED THEREIN NEEDS TO BE ACCEPTED IN TOTALITY AND NOT IN PIECEMEAL. WE FIND MERIT IN THE CONTENTION OF THE LD AR THAT ONCE THE SALE DEED HAS BEEN ACCEPTED AND TAKEN AS A BASIS FOR BRINGING TO TAX THE SALE OF THE IMPUNGED PROPERTY, THE AVERMENTS MADE THEREIN NEED TO BE ACCEPTED UNLESS AND UNTIL THERE ARE ANY CONTRARY EVIDENCE BROUGHT ON RECORD. IN ABSENCE OF ANYTHING CONTRARY ON RECOR D, THE YEAR OF CONSTRUCTION THEREFORE HAS TO BE TAKEN AS FINANCIAL YEAR 1985-86 AND COST INFLATION INDEX SHOULD BE TAKEN ACCORDINGLY WHILE DETERMINING THE I NDEXED COST OF ACQUISITION. BESIDES, WE DONOT FIND ANY MAJOR OBJECTIONS RAISED BY THE ASSESSING OFFICER. IN LIGHT OF ABOVE DISCUSSIONS, THE VALUATION REPORT SO SUBMITTED BY THE ASSESSEE IS ACCEPTED SUBJECT TO EXCLUSION OF COST OF CONSTRUCTI ON RELATING TO 1625 SQ. FT WHICH WAS CONSTRUCTED PRIOR TO AND BEFORE THE ACQUI SITION OF THE IMPUNGED PROPERTY BY THE PREVIOUS OWNER. THE MATTER IS ACCOR DINGLY SET-ASIDE TO THE FILE OF THE ASSESSING OFFICER TO RECOMPUTE THE COST OF A CQUISITION AND DETERMINE THE INDEXED COST OF ACQUISITION BY APPLYING THE INDEXAT ION FACTOR FOR FINANCIAL YEAR 1985-86. IN THE RESULT, THE GROUND OF APPEAL IS PA RTLY ALLOWED. IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALL OWED. ITA NO. 384/JP/2018 LATE SHRI DHAN SINGH BHATI, AJMER VS. CIT, CIRCLE-1 , AJMER 17 ORDER PRONOUNCED IN THE OPEN COURT ON 11/02/2019. SD/- SD/- FOT; IKY JKO FOE FLAG ;KNO (VIJAY PAL RAO) (VIKRAM SINGH YADAV) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 11/02/2019 * GANESH KR. VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- LATE SHRI DHAN SINGH BHATI, AJMER 2. IZR;FKHZ@ THE RESPONDENT- CIT, CIRCLE-1, AJMER 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDR@ CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR. 6. XKMZ QKBZY@ GUARD FILE {ITA NO. 384/JP/2018} VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASST. REGISTRAR