Deepak Kohli, Lucknow V. Income Tax Officer-IV(1), Lucknow

ITA 49/LKW/2017

• Counselvise Citation: [2018] 124 COUNSELVISE.COM (IT) 7255 (ITAT-LUCKNOW)
• Duration Of Justice: 1 year(s) 8 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-09-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 19-01-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Sale consideration of property below Jantri Value; Capital asset; Opportunity of being heard; Fair market value; Valuation report
• Section: 50C

Judgement Text

I.T.A. NO.49/LKW/2017 ASSESSMENT YEAR:2009-10 1 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH SMC, LUCKNOW BEFORE SHRI T. S. KAPOOR, ACCOUNTANT MEMBER ITA NO.49/LKW/2017 ASSESSMENT YEAR:2009-10 SHRI DEEPAK KOHLI, 68/2, MILL ROAD, AISHBAGH, LUCKNOW. PAN:AHWPK 8742 N VS. INCOME TAX OFFICER-IV(1), LUCKNOW. (APPELLANT) (RESPONDENT) O R D E R THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF LEARNED CIT(A)-II, LUCKNOW DATED 11/11/2016. THIS APPEAL WAS EARLIER DISMISSED OF BY THE HON'BLE TRIBUNAL VIDE ORDER DAT ED 16/02/2018 ON ACCOUNT OF NON PROSECUTION. HOWEVER, SUCH ORDER OF HON'BLE TRIBUNAL HAS BEEN RECALLED IN MISC. APPLICATION NO. 11 VIDE ORDE R DATED 24/04/2018 AND APPEAL WAS FIXED FOR HEARING ON MERITS. 2. AT THE OUTSET, LEARNED A. R. SUBMITTED THAT ASSE SSEE HAD SOLD AN IMMOVABLE PROPERTY AND HAD DECLARED CAPITAL GAIN ON SUCH PROPERTY AND IN THE CALCULATION OF CAPITAL GAIN THE ASSESSEE HAD CL AIMED BENEFIT OF INDEXATION ON CERTAIN ADDITIONS WHICH WAS MADE BY HIM DURING V ARIOUS YEARS. IT WAS SUBMITTED THAT THE ASSESSEE HAD ALSO SUBMITTED A VA LUATION REPORT TO SUPPORT HIS CLAIM OF HAVING SPENT VARIOUS AMOUNTS D URING VARIOUS YEARS. HOWEVER, THE AUTHORITIES BELOW REQUIRED THE ASSESSE E TO FILE THE COPIES OF APPELLANT BY SHRI RAKESH GARG, ADVOCATE RESPONDENT BY S HRI JAI NATH VERMA, D. R. DATE OF HEARING 24/09/2018 DATE OF PRONOUNCEMENT 28/09/2018 I.T.A. NO.49/LKW/2017 ASSESSMENT YEAR:2009-10 2 BILLS OF EXPENSES WHICH WERE INCURRED FOR MAKING AD DITIONS TO THE PROPERTY. IT WAS FURTHER SUBMITTED THAT THE ASSESSING OFFICER REJECTED THE VALUATION REPORT SUBMITTED BY THE ASSESSEE AND DISALLOWED THE CLAIM OF ADDITIONS DURING THE VARIOUS YEARS WHEREAS THE CIT(A) ALLOWED PART RELIEF FOR THE BILLS WHICH WERE SUBMITTED TO HIM WHEREAS FOR THE REMAINI NG AMOUNTS FOR WHICH BILL COULD NOT BE FILED THE LEARNED CIT(A) HAS SUST AINED THE ADDITION. IT WAS SUBMITTED THAT IT WAS NOT POSSIBLE ON THE PART OF T HE ASSESSEE TO FILE COPIES OF BILLS OF EXPENDITURE WHICH HE HAD INCURRED MORE THAN 10 YEARS BACK. LEARNED A. R. FURTHER SUBMITTED THAT THE ASSESSING OFFICER REJECTED THE VALUATION REPORT WHEREAS IF HE WAS NOT SATISFIED WI TH VALUATION, HE SHOULD HAVE REFERRED THE VALUATION REPORT TO D.V.O. FOR HI S COMMENTS AND THEREFORE, THE ORDER PASSED BY THE ASSESSING OFFICE R NEEDS TO BE QUASHED IN VIEW OF AN ORDER OF HON'BLE DELH TRIBUNAL IN THE CA SE OF INCOME TAX OFFICER VS. ADITYA NARAIN VERMA (HUF) IN I.T.A. NO.4166/DEL /2013 AND IN THIS RESPECT OUR ATTENTION WAS INVITED TO PAGES F-P OF T HE PAPER BOOK WHERE A COPY OF ORDER WAS PLACED. 3. LEARNED D. R., ON THE OTHER HAND, ARGUED THAT AS SESSEE WAS ASKED TO FILE COPIES OF BILLS FOR WHICH HE HAD FAILED AND TH EREFORE, THE LEARNED CIT(A) HAS PARTLY ALLOWED RELIEF TO THE ASSESSEE ON THE BA SIS OF BILLS WHICH THE ASSESSEE WAS HAVING IN HIS POSSESSION. LEARNED D. R. SUBMITTED THAT THE GROUNDS TAKEN BY THE ASSESSEE REGARDING QUASHING OF ASSESSMENT DOES NOT ARISE FROM THE ORDER OF LEARNED CIT(A) OR ASSESSING OFFICER AND THEREFORE, SHOULD NOT BE ENTERTAINED. LEARNED A. R. IN HIS RE JOINDER SUBMITTED THAT THE GROUND TAKEN BY THE ASSESSEE VIDE GROUND NO. 3 IS A LEGAL GROUND AND THE ASSESSEE HAS QUESTIONED THE REJECTION OF VALUATION REPORT SUBMITTED BY THE ASSESSEE WITHOUT REFERRING THE SAME TO D.V.O. 4. I HAVE HEARD THE RIVAL PARTIES AND HAVE GONE THR OUGH THE MATERIAL PLACED ON RECORD. I FIND THAT ASSESSEE HAD SOLD A PROPERTY AT HARIDWAR AND I.T.A. NO.49/LKW/2017 ASSESSMENT YEAR:2009-10 3 HAD CLAIMED TO HAVE SPENT RS.8,71,000/- IN THE YEAR 1996 AND FURTHER AN AMOUNT OF RS.5,68,581/- WAS CLAIMED TO HAVE BEEN SP ENT DURING THE YEAR 2001-02, 2002-03 AND 2008-09. I FIND THAT IN SUPPOR T OF THE EXPENSES CLAIMED TO HAVE BEEN INCURRED DURING THESE YEARS TH E ASSESSEE FILED A VALUATION REPORT, A COPY OF WHICH IS PLACED AT PAGE S 4 TO 9 OF THE PAPER BOOK. WHILE GOING THROUGH THIS COPY OF VALUATION R EPORT, I FIND THAT THE VALUER HAS ONLY MENTIONED THE AMOUNTS WHICH THE ASS ESSEE HAD CLAIMED TO HAVE INCURRED DURING THESE YEARS. HOWEVER, NO TECH NICAL EVALUATION HAS BEEN DONE AS TO WHAT WAS THE PART OF THE PROPERTY O N WHICH THE ASSESSEE HAD SPENT THE AMOUNTS DURING THESE YEARS. THE ASSE SSING OFFICER HAS THEREFORE, NOT CONSIDERED THE ABOVE VALUATION REPOR T AS THE SAME DID NOT SPECIFY THE DETAILS OF BUILDING I.E. NUMBER OF ROOM S OR FLOORS IN THE BUILDING. LEARNED A. R. HAS ARGUED THAT IF THE ASSESSING OFFI CER WAS NOT SATISFIED WITH THE VALUATION REPORT HE SHOULD HAVE REFERRED THE MA TTER TO VALUATION OFFICER FOR HIS VALUATION WHICH HE HAS FAILED TO DO AND THE REFORE, THE TOTAL ADDITION IS TO BE DELETED. LEARNED A. R. HAS RELIED ON A JUDGM ENT OF HON'BLE DELHI TRIBUNAL IN THE CASE OF INCOME TAX OFFICER VS. ADIT YA NARAIN VERMA (HUF) (SUPRA). WHILE GOING THROUGH THE FACTS OF THIS CAS E LAW, I FIND THAT THIS CASE RELATES TO THE DEEMED VALUE WHICH THE ASSESSING OFF ICER TAKES U/S 50C OF THE ACT WHEREAS THE PRESENT CASE RELATES TO THE REF ERENCE TO VALUATION OFFICER U/S 55A OF THE ACT. IN THE CASE RELIED ON BY ASSESSEE, THE ISSUE IS REGARDING THE POWER OF ASSESSING OFFICER TO TAKE FU LL VALUE OF CONSIDERATION U/S 50C WHERE THE CONSIDERATION RECEIVED OR ACQUIRE D AS A RESULT OF TRANSFER BY AN ASSESSEE OF A CAPITAL ASSET IS LESS THAN THE VALUE ADOPTED OR ASSESSED FOR STAMP DUTY PURPOSES. IT IS FURTHER PROVIDED IN THE PROVISIONS THAT WHERE THE ASSESSEE CLAIMS THAT THE VALUE SO ADOPTED BY TH E STAMP VALUATION AUTHORITY EXCEEDS THE FAIR MARKET VALUE OF THE PROP ERTY, THE ASSESSING OFFICER MAY REFER THE VALUATION OF CAPITAL ASSET TO A VALUATION OFFICER AND IT IS IN THIS CONTEXT, THE DECISION RELIED ON BY LEARN ED A. R. IS BASED. I.T.A. NO.49/LKW/2017 ASSESSMENT YEAR:2009-10 4 HOWEVER, IN THE PRESENT CASE THE ASSESSEE HAS ONLY CLAIMED ADDITIONS TO THE PROPERTY DURING VARIOUS YEARS AND FOR WHICH HE HAD FILED VALUATION REPORT. THEREFORE, THE CASE LAW RELIED ON BY LEARNED A. R. IS DISTINGUISHABLE AND MOREOVER THE VALUATION REPORT IS SILENT ON THE TECH NICAL ASPECT AS TO WHAT ADDITIONS HAVE BEEN MADE BY ASSESSEE. THOUGH I AGR EE WITH THE ARGUMENTS OF LEARNED A. R. THAT ASSESSEE CANNOT BE EXPECTED T O PROVIDE BILLS ETC. RELATING BACK TO ABOUT 10 YEARS BUT IT IS ALSO CORR ECT THAT THE ONUS LIES ON THE ASSESSEE TO SUBSTANTIATE HIS CLAIMS EITHER THROUGH DOCUMENTARY EVIDENCE OR THROUGH TECHNICAL REPORT. THE VALUATION REPORT FIL ED BY ASSESSEE IS NOT A TECHNICAL REPORT AND IT ONLY MENTIONS THE EXACT AMO UNT OF EXPENDITURE ON ADDITIONS. THEREFORE, I DEEM IT APPROPRIATE TO REM IT THE ISSUE BACK TO THE ASSESSING OFFICER WHO SHOULD VERIFY THIS ASPECT AFT ER TAKING A REPORT FROM TECHNICAL OFFICER REGARDING THE CLAIMS OF THE ASSES SEE AS AFTER A PERIOD OF ABOUT 10 YEARS IT IS NOT POSSIBLE FOR THE ASSESSEE TO FURNISH THE BILLS OF ADDITIONS. NEEDLESS TO SAY THE ASSESSEE WILL BE AF FORDED REASONABLE OPPORTUNITY OF BEING HEARD. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE STANDS ALLOWED FOR STATISTICAL PURPOSES. (ORDER PRONOUNCED IN THE OPEN COURT ON 28/09 /2018) SD/. ( T. S. KAPOOR ) ACCOUNTANT MEMBER DATED:28/09/2018 *SINGH COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. CONCERNED CIT 4. THE CIT(A) 5. D.R., I.T.A.T., LUCKNOW