Income Tax Officer (Ward) -2 (2), Panaji V. Smt. Myra Muriel Paul, Goa

ITA 435/PAN/2013

• Counselvise Citation: 43524114 RSA 2013
• Duration Of Justice: 3 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-04-2014
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2009-2010
• Appeal Filed On: 30-12-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SONAL L SONKAVDE LD
• Assessee Lawyers: R K PIKALE
• Keywords: Capital asset; Cost of acquisition

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PANAJI BENCH, PANAJI BEFORE SHRI P.K. BANSAL, HONBLE ACCOUNTANT MEMBER AND SHRI D.T. GARASIA, HONBLE JUDICIAL MEMBER ITA NO. 4 35 /PNJ/2013 : (ASST. YEAR : 2009 - 10) INCOME - TAX OFFICER, WARD - 2 (2) , PANAJI , GOA (APPELLANT) VS. SMT. MYRA MURIEL PAUL H.NO. 647, PONSULEM, COLVALE, BARDEZ, GOA (RESPONDENT) PAN : AHDPP7557M ASSESSEE BY : R.K. PIKALE , CA REVENUE BY : SMT. SONAL L. SONKAVDE, LD. DR DATE OF HEARING : 26 /03/2014 DATE OF PRONOUNCEMENT : 04 /0 4 /2014 O R D E R PER P.K. BANSAL 1. THIS APPEAL HAS BEEN FILED BY THE REVENUE AGAINST THE ORDER OF THE CIT(A) DT. 28.10.2013 FOR A.Y. 2009 - 10 BY TAKING THE FOLLOWING EFFECTIVE GROUNDS OF APPEAL : 1. THE ORDER OF THE ICTA IS OPPOSED TO LAW AND FACTS OF THE CASE. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE DECISION OF THE LEARNED CIT(A) IS AGAINST THE PROVISIONS OF SECTION 2(47) OF THE INCOME TAX ACT. 3. THE ASSESSEE HAD ACTUALLY SOLD THE PROPERTY AFTER RECEIVING ENTIRE SALE CONSIDERATION BY EXECUTING A SALE DEED ON 04/07/2008. SUBSEQUENTLY, THE SAID TRANSACTION WAS RECTIFIED TWICE AND THE FINAL RECTIFICATION DEED WAS EXECUTED ON 15/09/2009 AND THE BALANCE OF CONSIDE RATION WAS RETURNED TO PURCHASER. THE CIT(A) ERRED IN PLACING HIS DECISION THAT ACTUAL SALE TOOK PLACE DURING THE FINANCIAL YEAR 2009 - 10 IN WHICH RECTIFIED SALE DEED WAS EXECUTED BUT IN THE FINANCIAL YEAR 2008 - 09 RELEVANT TO A Y 2009 - 10 IN WHICH ACTUAL SA LE TAKEN PLACE. 2. THE ONLY ISSUE INVOLVED IN THIS APPEAL FILED BY THE REVENUE IS WHETHER THE TRANSFER OF THE LAND HAS TAKEN PLACE DURING THE IMPUGNED ASSESSMENT YEAR OR IN THE SUCCEEDING ASSESSMENT YEAR SO THAT THE CAPITAL GAINS MAY BE CHARGEABLE TO TAX IN THAT ASSESSMENT YEAR. 2 ITA NO. 435/PNJ/2013 (ASST. YEAR : 2009 - 10) 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE HAS SOLD AN AGRICULTURAL PROPERTY ADMEASURING 113659 SQ.MTRS. BEARING SURVEY NO. 31/1(PART) OF OXEL VILLAGE, BARDEZ TALUKA BY REGISTERED SALE DEED DT. 4.7.2008. SUBSEQUENTLY , THE SAID SALE DEED WAS RECTIFIED BY RECTIFICATION DEED DT. 21.11.2008 AND 15.9.2009. THE AREA OF THE LAND TRANSFERRED GOT REDUCED TO 51140 SQ. MTRS. AND THE NET SALE CONSIDERATION ALSO WAS REDUCED TO RS.1,34,64,000/ - . THE AO ASSESSED LONG TERM CAPITAL GAINS DURING THE IMPUGNED ASSESSMENT YEAR TAKING THE SALE CONSIDERATION OF RS.1,34,64,000/ - AFTER REDUCING THE INDEXED COST OF ACQUISITION OF RS. 25,86,408/ - AND DETERMINED THE LONG TERM CAPITAL GAINS AT RS. 1,08,77,592/ - . THE ASSESSEE WENT IN APPEAL BEFOR E THE CIT(A). BEFORE THE CIT(A), THE ASSESSEE HAS TAKEN THE FOLLOWING GROUNDS OF APPEAL : 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED AO ERRED IN TREATING THE AGRICULTURAL LAND BEYOND 8 KM FROM MUNICIPAL LIMITS AS CAPITAL ASSET AND CONSID ERED THE GAIN ON TRANSFER AS THE LONG TERM CAPITAL GAIN TO THE EXTENT OF RS.54,38,796/ - (HALF OF RS.1,08,77,592/ - ). 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED AO AND THE DISTRICT VALUATION OFFICER ERRED IN TAKING THE VALUATION OF THE PROPE RTY AS ON 01.04.1981 AT RS.4,44,400/ - . 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED AO ERRED IN ASSESSING THE CAPITAL GAIN FOR A.Y. 2009 - 10 WHILE THE SALE WAS CONCLUDED DURING THE PREVIOUS YEAR RELEVANT TO A.Y. 2010 - 11. BUT CIT(A) DISMISSE D THE FIRST TWO GROUNDS OF APPEAL TAKEN BY THE ASSESSEE MENTIONING THEREIN THAT THE COUNSEL OF THE ASSESSEE HAS WITHDRAWN THE FIRST TWO GROUNDS OF APPEAL. IN RESPECT OF THE THIRD GROUND, CIT(A) DECIDED IT IN FAVOUR OF THE ASSESSEE AND TOOK THE DATE OF LAS T RECTIFICATION DEED TO BE DATE OF TRANSFER OF THE LAND AND DIRECTED THE AO TO CHARGE CAPITAL GAINS DURING THE A.Y 2010 - 11. THE REVENUE HAS COME IN APPEAL BEFORE US. 4. WE HAVE HEARD THE RIVAL SUBMISSIONS AND CAREFULLY CONSIDERED THE SAME ALONGWITH THE ORDER OF THE TAX AUTHORITIES BELOW. IT IS NOT DENIED BEFORE US THAT 3 ITA NO. 435/PNJ/2013 (ASST. YEAR : 2009 - 10) THE SALE DEED WAS ORIGINALLY EXECUTED AND REGISTERED ON 4.7.2008. WE HAVE ALSO LOOKED INTO THE COPY OF THE REGISTERED SALE DEED FOR THE SALE OF THE IMPUGNED LAND BUT SUBSEQUENTLY, DEED OF RECTIFICATION WAS EXECUTED AND REGISTERED ON 21.11.2008 AND 15.9.2009 RECTIFYING THE SALE CONSIDERATION AS WELL AS THE AREA OF THE LAND TRANSFERRED. THE AREA OF THE LAND TRANSFERRED AFTER THE RECTIFICATION DEED CAME TO 51140 SQ. MTRS. WHILE THE S ALE CONSIDERATION WAS REDUCED TO RS.1,34,64,000/ - . THE AO WHILE COMPUTING THE CAPITAL GAINS CHARGEABLE TO TAX HAS TAKEN THE SALE CONSIDERATION AT RS.1,34,64,000/ - . THE LD. AR BEFORE US EVEN THOUGH VEHEMENTLY CONTENDED THAT SINCE THE CONSIDERATION AND THE AREA OF THE LAND WAS NOT CORRECT IN THE SALE DEED, THEREFORE, THE RECTIFICATION DEED HAS BEEN EXECUTED AND THE TRANSFER ACTUALLY TOOK PLACE, AS PER THE PROVISIONS OF SEC. 2(47), ONLY WHEN THE LAST OF THE RECTIFICATION DEED WAS EXECUTED AND REGISTERED I.E. ON 15.9.2009 AND, THEREFORE, THE CAPITAL GAINS MUST BE CHARGEABLE TO TAX DURING THE A.Y 2010 - 11. WE DO NOT AGREE WITH THE SUBMISSION OF THE LD. AR. IN OUR OPINION, WHEREVER A RECTIFICATION DEED IS EXECUTED, IT RECTIFIES THE ORIGINAL TRANSACTION AND IS A PPLICABLE FROM THE DATE WHEN THE ORIGINAL TRANSACTION TOOK PLACE. THE SALE DEED IN THIS CASE WAS ORIGINALLY EXECUTED AND REGISTERED ON 4.7.2008. THEREFORE, IN OUR OPINION, THE TRANSFER OF THE LAND HAS TAKEN PLACE DURING THE A.Y 2009 - 10. WE, ACCORDINGLY, SET ASIDE THE ORDER OF CIT(A) AND RESTORE THE ORDER OF THE AO ON THIS ISSUE. 5. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS ALLOWED. 6. ORDER PRONOUNCED IN THE OPEN COURT ON 04 .04.2014. SD/ - (D.T.GARASIA) JUDICIAL MEMBER SD/ - (P.K. BANSAL) ACCOUNTANT MEMBER PLACE : PANAJI / GOA DATED : 04 .04. 201 4 SSL 4 ITA NO. 435/PNJ/2013 (ASST. YEAR : 2009 - 10) COPY TO : (1) APPELLANT (2) RESPONDENT (3) CIT CONCERNED (4) CIT(A) CONCERNED (5) D.R (6) GUARD FILE TRUE COPY, BY ORDER