Sri Yogendra Kumar Bhardwaj, Ghaziabad V. ITO, New Delhi

ITA 4835/DEL/2016

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 6811 (ITAT-DELHI)
• Duration Of Justice: 4 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-02-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC 2
• Next Hearing Date: 10-11-2016
• Assessment Year: 2010-2011
• Appeal Filed On: 09-09-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: F R MEENA
• Keywords: Additional evidence; Valuation report; Condonation of delay

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH SMC-II, NEW DELHI BEFORE SMT. DIVA SINGH, JUDICIAL MEMBER ITA NO.4835/DEL/2016 ASSESSMENT YEAR : 2010-11 YOGENDRA KUMAR BHARDWAJ, A-125, SURYA NAGAR, GHAZIABAD 201 011. VS. ITO, WARD-40(1), NEW DELHI PAN : AFCPB 1543 E (APPELLANT) (RESPONDENT) APPELLANT BY NONE RESPONDENT BY SHRI F.R. MEENA, SR.DR DATE OF HEARING 10-11-2016 DATE OF PRONOUNCEMENT 01-02-2017 O R D E R PER DIVA SINGH, J.M. : THE PRESENT APPEAL HAS BEEN FILED BY THE ASSESSEE A SSAILING THE CORRECTNESS OF THE ORDER DATED 20.06.2016 OF THE CIT(A)-28, NEW DELHI PERTAINING TO 2010-11 ASSESSMENT YEAR ON VARIOUS GROUNDS. HOWEVER, SINCE THE ASSESSEE RE MAINED UNREPRESENTED DESPITE ISSUANCE OF NOTICE, IT WAS CONSIDERED APPROPRIATE TO DECIDE THE APPEAL EX-PARTE QUA THE ASSESSEES APPEAL ON MERITS AFTER HEARING THE LD.SR.DR. THE S OLE ISSUE ADDRESSED BY THE REVENUE IS ADDRESSED IN GROUND NO.3 RAISED BY THE ASSESSEE. T HE SAME IS REPRODUCED HEREUNDER :- 3. FOR THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN NOT A DMITTING THE ADDITIONAL EVIDENCE FILED BY THE APPELLANT WHICH WAS GERMANE T O DECIDING THE ISSUE AND THE SAME AMOUNTED TO VIOLATION OF PRINCIPLES OF NAT URAL JUSTICE. 2. ADDRESSING THE DEFECT OF 2 DAYS POINTED OUT BY THE REGISTRY, IT IS SEEN THAT IN THE PETITION EXPLAINING THE DELAY, THE ASSESSEE HAS STA TED THAT THE DELAY HAD ARISEN ON ACCOUNT OF A SERIES OF DEATH IN HIS FAMILY OF THE ASSESSEE AS WELL AS MEDICAL EMERGENCY. THE LD. SR.DR CONSIDERING THE PRAYER OF THE ASSESSEE IN REGARD TO THE CONDONATION OF DELAY HAD NO OBJECTION IF THE DELAY IS CONDONED. ACCORDINGLY, C ONSIDERING THE PRAYER IN THE CONDONATION OF DELAY PETITION THE AFFIDAVIT FILED ON BEHALF OF TH E ASSESSEE AND AFTER HEARING THE LD.SR.DR THE DELAY OF 2 DAYS IN THE FILING OF THE APPEAL IS COND ONED. 3. A PERUSAL OF THE RECORD SHOWS THAT THE ASSESSEE IS STATED TO BE A SALARIED EMPLOYEE. THE RETURN WAS PICKED UP FOR SCRUTINY SINCE AS PER THE AIR INFORMATION AVAILABLE, THE 2 ITA NO.4835/DEL/2016 ASSESSEE WAS FOUND TO HAVE SOLD A PROPERTY FOR A SU M OF RS.53,25,000/-. THE AO REQUIRE THE ASSESSEE TO EXPLAIN THE SAME. THE ASSESSEE IN RESP ONSE STATED THAT THE SPECIFIC PROPERTY WAS PURCHASED IN 1992 FOR A SUM OF RS.4,00,000/- ON WHICH THE ASSESSEE CONSTRUCTED THREE FLOORS NAMELY GROUND FLOOR; FIRST FLOOR; AND SECOND FLOOR. SECOND FLOOR WAS CLAIMED TO HAVE BEEN SOLD FOR THE AFORESAID AMOUNT. CONSIDERING TH E COST OF CONSTRUCTION OF THE SECOND FLOOR TAKEN BY AN APPROVED VALUE AT RS.15,25,000/- LONG T ERM CAPITAL GAIN OF RS.32,91,086/- WAS ADDED TO THE INCOME OF THE ASSESSEE. 4. THE ASSESSEE ASSAILED THE ADDITION BEFORE THE CI T(A). BEFORE HIM, FRESH EVIDENCES WERE SOUGHT TO BE FILED. THE FRESH EVIDENCES SOUGH T TO BE RAISED WERE NOT ADMITTED HOLDING THAT THE VALUATION REPORT RELIED UPON BY THE ASSESS ING OFFICER WAS THE EVIDENCE OF THE ASSESSEE. ACCORDINGLY, IT WAS CONSIDERED THAT THER E WAS NO REASON FOR ADMITTING ADDITIONAL EVIDENCE. 5. AGGRIEVED BY THIS ORDER, THE ASSESSEE HAS FILED THE PRESENT APPEAL BEFORE ITAT. A PERUSAL OF THE IMPUGNED ORDER SHOWS THAT BEFORE THE CIT(A), IT WAS SUBMITTED THAT THE COST OF CONSTRUCTION WHICH WAS TAKEN INTO CONSIDERATION BY THE APPROVED VALUER DOES NOT FACTOR IN THE COST OF IMPROVEMENT. THUS FRESH EVIDENCE TO ADDRES S THE ISSUE WAS STATED TO BE NECESSARY. APART FROM THAT IT WAS SUBMITTED THAT THE APPROVED VALUES HAD CALCULATED THE VALUE AS PER CPWD DSR RATES WHICH DOES NOT INCLUDE THE COST OF A LL THE ACCESSORIES WHICH HAD BEEN FITTED ON THE SITE LIKE MODERN FRAMES ON THE DOORS, WINDOWS; IRON GRILLS, IRON DOORS, HARD WARE (HANDLESS LOCKS/ BOLTS OF STAINLESS LOCKS STEEL), M ODULAR KITCHEN; CHIMNEY, RO SYSTEM, BATHROOM (TILES FIXTURES) IN THE TWO BATHROOMS, STE EL RAILING AND TOUGHENED GLASS, REAR IRON JALL, GLASS WORK, ELECTRICAL SWITCH/FANS/JHUMMAR/FANCY LI GHTS AND WARDROBES ETC. IT HAS BEEN SUBMITTED THAT A PERUSAL OF THE VALUATION REPORT RE LIED UPON BEFORE THE AO WOULD SHOW THAT IT ONLY REFERS TO PLINTH AREA RATES AND THE IMPROVEMEN T IN THE PROPERTIES HAVE NOT BEEN TAKEN INTO CONSIDERATION. APART FROM THAT COST OF MAPS S ANCTIONING/WATER/ELECTRICITY/SEWER CONSTRUCTION, COST OF COMPOUNDING ETC. RELATABLE TO THE FLOOR SOLD HAVE ALSO NOT BEEN CONSIDERED BY THE AO. IT IS SEEN THAT IT HAD BEEN ARGUED AS PER SUBMISSION RECORDED IN THE 3 ITA NO.4835/DEL/2016 IMPUGNED ORDER THAT COMPLETE DETAILS WERE AVAILABLE AND SHOULD HAVE BEEN CONSIDERED BY THE ASSESSING OFFICER, WHO DID NOT PROVIDE ANY OPPO RTUNITY IN REGARD TO THE ISSUES CONSIDERED FOR MAKING THE ADDITION. HAD THE OPPORTUNITY BEEN PROVIDED THE EVIDENCES WOULD HAVE BEEN MADE AVAILABLE TO THE AO HIMSELF. RELIANCE WAS PLA CED UPON PARA 1 OF THE ASSESSMENT ORDER TO STATE THAT ALL DOCUMENTS ASKED FOR HAVE BEEN FILED AND ON THIS ASPECT THERE WAS NO QUERY. 5.1. CONSIDERING THE DETAILED ARGUMENTS FOR ADMISSI ON OF FRESH EVIDENCE AVAILABLE ON RECORD IN THE PECULIAR FACTS AND CIRCUMSTANCES AND THE DETAILS AVAILABLE IN STATEMENT OF FACTS FILED, THE LD. SR. DR WAS UNABLE TO SUPPORT THE FOL LOWING FINDING OF THE CIT(A) :- 2.3 IN THE CASE UNDER CONSIDERATION THE ASSESSMENT HAS BEEN COMPLETED AFTER BEING GIVEN REASONABLE OPPORTUNITY TO THE ASS ESSEE. FURTHER THE CAPITAL GAIN IN QUESTION HAS BEEN DULY CALCULATED ON THE BA SIS OF THE DETAILS AND DOCUMENT FURNISHED BY THE ASSESSEE. MOREOVER THE V ALUATION REPORT WAS PREPARED BY THE REGISTERED VALUER OF THE ASSESSEE, HENCE THERE IN NO REASON FOR ADMITTING ADDITIONAL EVIDENCE SUBMITTED BY THE APPE LLANT. FURTHER THE SAME IS ALSO NOT COVER WITH THE EXCEPTIONS AND EXPLANATION SPECIFIED IN RULE 46A OF THE INCOME TAX RULE. 2.4 CONSIDERING THE ABOVE, I DONT FIND ANY INFIRMI TY IN THE LONG TERM CAPITAL GAIN CALCULATED BY THE A.O. ACCORDINGLY TH E ADDITION OF RS.32,91,086/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF UNDISCL OSED CAPITAL GAIN IS CONFIRMED. 5.2. ACCORDINGLY, IT WAS HIS SUBMISSION THAT THE IS SUE MAY BE REMITTED BACK. 6. I HAVE HEARD THE SUBMISSIONS OF THE LD.SR.DR AND PERUSED THE MATERIAL AVAILABLE ON RECORD. ON A CONSIDERATION OF THE SAME, I FIND THA T THE IMPUGNED ORDER CANNOT BE UPHELD AS THE ARGUMENTS AND STATEMENTS OF FACTS FILED ON BEHA LF OF THE ASSESSEE BEFORE THE CIT(A) HAVE NOT BEEN TAKEN INTO CONSIDERATION BY THE CIT(A) WHI LE PASSING THE ORDER. CONSIDERING THE NATURE OF EVIDENCE AND THE DOCUMENTS WHICH THE LD.A R SEEKS TO RELY UPON, I FIND NO GOOD REASON AS TO WHY THE SAME CANNOT BE TAKEN NOTE OF B Y THE TAX AUTHORITIES WITHOUT UPSETTING THE ARGUMENT THAT THESE SPECIFIC DETAILS AND FACTS ARE NOT AVAILABLE IN THE VALUATION REPORT FILED AS IT MERELY MENTIONS PLINTH AREA AND RATES W ITHOUT ADDRESSING THE SPECIFIC IMPROVEMENTS CARRIED OUT IN THE PROPERTY BEFORE SAL E. THUS MERELY BECAUSE THE ASSESSEE HAS FILED A VALUATION REPORT BEFORE THE AO THE SAID FACT CANNOT BE MADE THE BASIS FOR 4 ITA NO.4835/DEL/2016 REJECTING THE CLAIM OF IMPROVEMENTS CARRIED OUT ON THE PROPERTY. IN THE PRESENT CASE, THE ASSESSEE PLEADED THAT EVIDENCES WERE AVAILABLE BEFO RE THE ASSESSING OFFICER AND SINCE THEY HAVE NOT BEEN CONSIDERED BY HIM AN ADDITION HAS BEE N MADE AGAIN IGNORING THESE DOCUMENTS. THE EVIDENCES IN REGARD TO CLAIM OF IMP ROVEMENTS CARRIED OUT; EVIDENCES PERTAINING TO MAP SANCTIONING, WATER/ELECTRICAL/SEW ER WORK, CONSTRUCTION COSTS, COST OF COMPOUNDING ETC. ARE NOT ONLY RELEVANT AND CRUCIAL EVIDENCE BUT ARE ALSO NOT THE KIND OF EVIDENCES WHICH CAN BE SELF-CREATED. THUS, NON-CON SIDERATION OF THE SAME CANNOT BE COUNTENANCED. ACCORDINGLY, IT IS DEEMED APPROPRIAT E TO SET ASIDE THE ISSUE DIRECTING THE LD.CIT(A) NOT ONLY TO ADMIT THE FRESH EVIDENCES QUA THE CLAIM OF IMPROVEMENTS IN THE PROPERTY SOLD BUT ALSO DIRECT THE SAID AUTHORITY TO GRANT NECESSARY RELIEF BY WAY OF APPORTIONING THE COSTS OF MAP SANCTIONING COSTS; WA TER AND SEWER WORK COSTS ETC. RELATABLE TO THE FLOOR SOLD. ACCORDINGLY, THE IMPUGNED ORDER IS SET ASIDE TO THE FILE OF THE CIT(A) IN THE LIGHT OF THE ABOVE DIRECTIONS. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 0 1 FEBRUARY, 2017. SD/- SD/- SD/- S (A. N. MISHRA) (DIVA SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER SUJEET/AMIT COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI