ITO 19(1)(2), MUMBAI V. SURESH KUMAR JAIN (HUF), MUMBAI

ITA 4291/MUM/2009

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 1380 (ITAT-MUMBAI)
• Duration Of Justice: 11 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-06-2010
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Assessment Year: 2005-2006
• Appeal Filed On: 15-07-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D SONGATE
• Keywords: Fair market value; Capital Gains

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES E, MUMBAI BEFORE SHRI R.S.SYAL, AM AND SHRI V.DURGA RAO, JM ITA NO.4291/MUM/2009 : ASST.YEAR 2005-2006 THE INCOME TAX OFFICER WARD 19(1)(2) MUMBAI. VS. SURESH KUMAR JAIN (HUF) 535, MEGHDOOT BUILDING, LINKING ROAD KHAR (WEST), MUMBAI 400 052. PA NO.AAJHS6242K. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI D.SONGATE RESPONDENT BY : SHRI K.SHIVRAM O R D E R PER R.S.SYAL, AM : THIS APPEAL BY THE REVENUE ARISES OUT OF THE ORDER PASSED BY THE COMMISSIONER OF INCOME-TAX (APPEALS) ON 04.05.2009 IN RELATION TO THE ASSESSMENT YEAR 2005-2006. 2. THE FOLLOWING EFFECTIVE GROUND HAS BEEN RAISED B Y THE REVENUE:- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD.CIT(A) HAS ERRED IN HOLDING THAT THE REFERENCE M ADE TO THE DISTRICT VALUATION OFFICER BY THE A.O. FOR ASCERTAINING FAIR MARKET VALUE OF THE PROPERTY AS ON 1-04-1981 AS INVALID AND DIRECTED TH E A.O. TO WORK OUT THE LONG TERM CAPITAL GAINS AS PER THE FMV OF THE P ROPERTY AS ON 1-04- 1981 BASED ON THE REGISTERED VALUERS REPORT AND DE LETE THE ADDITION MADE IN REGARD WITHOUT APPRECIATING THE FACT THAT T HE A.O. MAKING REFERENCE TO D.V.O. IS VERY MUCH LEGAL AS PER PROVI SIONS OF SEC.55A(B) OF THE I.T.ACT, 1961. ITA NO.4291/MUM/2009 SURESH KUMAR JAIN (HUF). 2 3. BRIEFLY STATED THE FACTS OF THE CASE ARE THAT TH E ASSESSEE-HUF DERIVED INCOME FROM HOUSE PROPERTY. IN THE PREVIOUS YEAR RELEVANT TO THE ASSESSMENT YEAR UNDER CONSIDERATION, THE ASSESSEE ALONG WITH ITS OTHER FO UR CO-OWNERS, SOLD A RESIDENTIAL PROPERTY VIZ. GIRIKUNJ LOCATED AT JVPD, VILLE PARLE (W), MUMBAI FOR A TOTAL CONSIDERATION OF RS.7,00,00,000. THE ASSESSEE BEING 1/5 TH SHAREHOLDER IN SUCH HOUSE PROPERTY, SHOWED LONG TERM CAPITAL GAIN OF R S.34,82,235 AND CLAIMED DEDUCTION U/S.54EC FOR A SUM OF RS.40 LAKHS THEREBY SHOWING NIL TAXABLE LONG TERM CAPITAL GAIN. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER REFERRED THE MATTER TO THE DISTRICT VALUATI ON OFFICER FOR ASCERTAINING THE FAIR MARKET VALUE OF THE PROPERTY AS ON 1.4.1981. THE DV O ESTIMATED THE FAIR MARKET VALUE AS ON THE DATE OF SALE AT RS.7,43,51,000 AND THE ASSESSEES SHARE OF FAIR MARKET VALUE AS ON 1.4.1981 AT RS.51,43,000 AS AGA INST OF RS.85,59,155 DISCLOSED BY THE ASSESSEE. ON THE BASIS OF DVOS REPORT, THE A.O. COMPUTED THE LONG TERM CAPITAL GAIN IN THE HANDS OF THE ASSESSEE AT RS.59, 96,104 AND AFTER ALLOWING EXEMPTION U/S.54EC FOR RS.40 LAKHS, HE CALCULATED TAXABLE LONG TERM CAPITAL GAIN OF RS.19,96,104. THE LEARNED CIT(A) CONCURRED WITH THE SUBMISSIONS ADVANCED ON BEHALF OF THE ASSESSEE AND HELD THE REFERENCE MADE TO THE DVO AS INVALID. 4. AT THE VERY OUTSET THE LEARNED COUNSEL FOR THE A SSESSEE PLACED ON RECORD A COPY OF THE ORDER PASSED BY THE TRIBUNAL IN THE CAS E OF ANOTHER CO-OWNER IN THE SAME PROPERTY, VIZ., ITO VS. KRANTI KUMAR JAIN (HUF ) IN ITA NO.4211/MUM/2009 DATED 14.5.2010. IT WAS SHOWN THA T THE TRIBUNAL HAS UPHELD THE CIT(A)S ORDER IN THE CASE OF OTHER CO-OWNER VI Z. KRANTI KUMAR JAIN (HUF) WITH REFERENCE TO THE SAME PROPERTY AND HENCE SIMIL AR VIEW BE ADOPTED. THE LEARNED DEPARTMENTAL REPRESENTATIVE CONCEDED THE FA CTUAL POSITION AS STATED ON BEHALF OF THE ASSESSEE. IN THE LIGHT OF THE PRECED ENT IN THE SHAPE OF ORDER PASSED BY THE TRIBUNAL IN THE CASE OF ANOTHER CO-OWNER OF THE SAME PROPERTY ON THE SAME ISSUE, WE ARE OF THE CONSIDERED OPINION THAT THE IM PUGNED ORDER DESERVES TO BE UPHELD. WE, THEREFORE, APPROVE THE VIEW TAKEN BY TH E LEARNED CIT(A) ON THIS ISSUE. ITA NO.4291/MUM/2009 SURESH KUMAR JAIN (HUF). 3 5. IN THE RESULT, THE APPEAL IS DISMISSED. ORDER PRONOUNCED ON THIS 30 TH DAY OF JUNE, 2010. SD/- SD/- (V.DURGA RAO) (R.S.SYAL) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI : 30 TH JUNE, 2010 . DEVDAS* COPY TO : 1. THE APPELLANT. 2. THE RESPONDENTS. 3. THE CIT CONCERNED 4. THE CIT(A)-XX, MUMBAI. 5. THE DR/ITAT, MUMBAI. 6. GUARD FILE. ` TRUE COPY. BY ORDER ASSISTANT REGISTRAR, ITAT, MUMBAI.