ITO 19(1)(1), MUMBAI V. KRANTI KUMAR JAIN (HUF), MUMBAI

ITA 4211/MUM/2009

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 2077 (ITAT-MUMBAI)
• Duration Of Justice: 10 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-05-2010
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2005-2006
• Appeal Filed On: 09-07-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIKRAM GAUR
• Assessee Lawyers: RAHUL K HAKANI
• Keywords: Capital asset; Question of law; Fair market value

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH A, MUMBAI. BEFORE SHRI J. SUDHAKAR REDDY, ACCOUNTANT MEMBER AND SHRI VIJAY PAL RAO, JUDICIAL MEMBER. I.T.A. 4211 /MUM/2009. ASSESSMENT YEAR : 2005-06. THE INCOME TAX OFFICER, KRAN TI KUMAR JAIN (HUF), 19(1)(1), MUMBAI. VS. 53 5 MEGHDOOT BLDG., LINKING ROAD, KHAR (W), MUMBAI 52. PAN AAAHKO502R. APPELLANT RESPONDENT APPELLANT BY : SHRI VIKRAM GAUR. RESPONDENT BY : SHRI RAHUL K. HAKANI. O R D E R PER J. SUDHAKAR REDDY, A.M. THIS IS AN APPEAL FILED BY THE ASSESSEE DIRECTED AGAINST THE ORDER OF THE CIT(APPEALS)-XX, MUMBAI DATED 04-05-2 009 FOR ASSESSMENT YEAR 2005-06. 2. WE HAVE HEARD MR. VIKRAM GAUR, LEARNED DR AND SHRI RAHUL K. HAKANI, LEARNED COUNSEL FOR THE ASSESSEE. 3. THE SHORT POINT FOR CONSIDERATION IN THIS APPEA L IS WHETHER THE AO HAS THE POWER TO REFER THE ISSUE OF ASCERTAI NMENT OF FAIR MARKET VALUE OF A PROPERTY AS ON 01-04-1981 TO THE DISTRIC T VALUATION OFFICER. THE FIRST APPELLATE AUTHORITY AFTER CONSIDERING THE DECISIONS IN THE CASE OF M/S RUBAB M. KAZERANI (MUMBAI) THIRD MEMBER, 91 ITD 429, SMT. KRISHNABAI TINGRE (PUNE) 101 ITD 317, URMILA BAWA (DELHI) 11 SOT 2 661 AND DAULAL MOHTA HUF - ITA NO. 1031 OF 2008 (BO MBAY HIGH COURT JUDGMENT), HAS CONCLUDED THAT THE AO HAS NO RIGHT WHATSOEVER TO REFER THE ASCERTAINMENT OF THE FAIR MARKET VALUE OF A PROPERTY AS ON 01-04- 1981 TO THE D.V.O.. 4. AT PARA 2.3.4 AND 2.3.5 OF THE CIT(APPEALS) OR DER, IT IS STATED AS FOLLOWS : 2.3.4 THE AR HAS ALSO INVITED MY ATTENTION BY SUB MITTING THAT THE SAID ORDER OF THE HONBLE ITAT, IN THE CAS E OF SHRI DAULAL MOHTA (HUF) (SUPRA) IS NOW DULY AFFIRMED BY THE HON BLE JURISDICTIONAL HIGH COURT VIDE ITS ORDER OF ITA NO. 1031 OF 2008 DATED 22.09.2008 (A COPY THEREOF FURNISHED IS PLACE D ON RECORD), RECORDING ITS DECISION VIDE PARAS 3,4 & 5 WHICH REA DS AS UNDER: 3. WE HAVE PERUSED THE JUDGMENT OF THE TRIBUNAL. I T IS EXPLICITLY CLEAR THAT THE QUESTION SOUGHT TO BE RAI SED ARE WITH REGARD TO THE QUANTUM OF VALUATION WHICH IS ONLY A FINDING OF FACT AND THERE IS ABSOLUTELY NO QUESTION OF LAW INV OLVED IN THE ABOVE APPEAL. 4. THE TRIBUNAL IN ITS ORDER DATED 23 RD JULY2004 HAS CATEGORICALLY OBSERVED THAT: 5. THE FIRST ISSUE THAT ARISES FOR OUR CONSIDERATI ON IS WHETHER THE REFERENCE MADE BY THE ASSESSING OFFI CER TO THE DVO U/S 55A IS BAD IN LAW UNDER FACTS AND CIRCUMSTANCES OF THE CASE. THIS ISSUE, IN OUR CONSIDERED OPINION, IS COVERED IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE BY THE JUDGMENT IN THE CASE OF RUBAB M. KAZERANI REPORTED IN 91 ITD 42 9 (MUM)(TM). FURTHER, THE CASE IS ALSO COVERED BY THE THIRD MEMBER DECISION OF THE PUNE BENCH OF THE TRIBUNAL IN THE CASE OF KRISHNABHAI TINGRE VS. ITO REPORTED IN 101 ITD 317 (PUNE)(TM) WHEREIN IT HAS BEEN HELD THAT REFERENCE TO THE DV) CAN ONLY BE MAD E IN CASES WHERE THE VALUE OF CAPITAL ASSET SHOWN BY THE ASSESSEE IS LESS THAN ITS FAIR MARKET VALUE OF LAND AS ON 1.4.1981 SHOWN BY THE ASSESSEE ON THE BASIS OF APPROVED VALUERS REPORT BEING MORE THAN ITS FAIR 3 MARKET VALUE, REFERENCE UNDER SECTION 55A WAS NOT VALID. RESPECTFULLY FOLLOWING THE PROPOSITION LAID DOWN, THESE TWO CASES BY THE COORDINATE BENCHES WE UPHOLD THE CONTENTION OF THE ASSESSEE AND HOLD THAT THE REFERENCE MADE BY THE ASSESSING OFFICER TO THE DVO U/S 55A IN THE PECULIAR FACTS AND CIRCUMSTANCES OF THE CASE IS BAD IN LAW. THUS ON THIS SOLE GROUND THE AP PEAL OF THE ASSESSEE HAS TO BE ALLOWED. 6. BEFORE PASSING, WE HAVE TO MENTION THAT THE ASSESSEE HAS SUBMITTED THE ARGUMENTS. AS ON THE BAI S OF THE LEGAL ASPECTS ITSELF WE HAVE DECIDED THE ISS UE IN FAVOUR OF THE ASSESSEE, WE REFRAIN FROM UNDERTAKING THIS ACADEMIC EXERCISE OF DISPOSING THIS CASE ON MERIT. 5. IN VIEW THEREOF THERE IS NO MERIT IN THE APPEAL. APPEAL STANDS DISMISSED. 2.3.5 IT IS ALSO NOTICED THAT ON IDENTICAL FACTS A ND CIRCUMSTANCES THIS LEGAL ISSUE IS DECIDED IN FAVOU R OF THE APPELLANT VIDE HONBLE ITAT, PUNE ORDER IN THE CASE OF SMT. K ISHNABAI TINGRE VS. ITO, 101 ITD 317 (PUNE) AND VIDE ORDER I N THE CASE OF URMILA BAWA VS. ACIT 11 SOT 661 (DEL) BY THE HONBL E ITAT DELHI. 5. THUS AS THE ISSUE IS COVERED BY THE DECISION OF THE JURISDICTIONAL HIGH COURT, WE UPHOLD THE ORDER OF T HE FIRST APPELLATE AUTHORITY. 6. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED ON THIS 14 TH DAY OF MAY, 2010. SD/- SD/- (VIJAY PAL RAO) (J. SUDHAKAR REDDY) JUDICIAL MEMBER. ACCOUNTANT MEMBER. MUMBAI, DATED : 14 TH MAY, 2010. 4 COPY FORWARDED TO : 1. APPELLANT. 2. RESPONDENT 3. C.I.T. 4. CIT(A) 5. DR, A-BENCH. (TRUE COPY) BY ORDER ASSTT. REGISTRAR, ITAT, MUMBAI BENCHES, MUMBAI. WAKODE