PRAVIN V. VORA, MUMBAI V. ACIT CIR 2, THANE

ITA 514/MUM/2012

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 88127 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 11 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-01-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 22-01-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 24-01-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AKHILENDRA YADAV
• Keywords: Opportunity of being heard; Principle of natural justice; Fair market value

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL C BE NCH, MUMBAI , !' #$%& , '' ' ( BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER ./I .T.A. NO.514/MUM/2012 ( ! ! ! ! ) ) ) ) / ASSESSMENT YEAR : 2008-09 SHRI PRAVIN V. VORA, 101, SUDAMA KUTIR, STATION ROAD,BHAYANDER(W) ! ! ! ! / VS. THE NACIT, CIRCLE 2, THANE * '' ./ + ./ PAN/GIR NO. : AAIPV 8198G ( *, / APPELLANT ) .. ( -.*, / RESPONDENT ) *, / ' / APPELLANT BY: SHRI SANJAY PARIKH -.*, 0 / ' / RESPONDENT BY: SHRI AKHILENDRA YADAV ! 0 12' / DATE OF HEARING :22.01.2015 3) 0 12' / DATE OF PRONOUNCEMENT :22.01.2015 '4 / O R D E R PER N.K. BILLAIYA, AM: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST T HE ORDER OF THE LD. CIT(A)II, THANE DT.5.10.2011 PERTAINING TO A.Y.2008 -09. 2. THE ASSESSEE HAS RAISED THREE SUBSTANTIVE GROUND S OF APPEAL. BY GROUND NO.1, THE ASSESSEE HAS ASSAILED THE ASSESSME NT ORDER CLAIMING THAT IT WAS IN VIOLATION OF THE PRINCIPLES OF NATURAL JU STICE AND THE LD. CIT(A) GROSSLY ERRED IN CONFIRMING SUCH ASSESSMENT ORDER. 3. THE ASSESSEE IS AN INDIVIDUAL AND IS A PARTNER I N VARIOUS FIRMS NAMELY M/S. SUDAMA & SONS, M/S. SUDAMA BUILDER, M/S . SUDAMA ESTATE ITA NO. 514/M/2012 2 AGENCY & M/S. SUDAMA IND. DEVELOPMENT CO. THE ASSE SSEE IS ALSO DERIVED INCOME FROM LONG TERM CAPITAL GAIN AND INC OME FROM OTHER SOURCES. 3.1. DURING THE COURSE OF THE ASSESSMENT PROCEEDING S, THE ASSESSING OFFICER NOTICED THAT THE ASSESSEE HAS ENTERED INTO AN AGREEMENT FOR DEVELOPMENT. THE TOTAL CONSIDERATION WAS RS. 55 LA KHS. THE MATTER WAS REFERRED TO THE STAMP VALUATION AUTHORITIES. THE S TAMP VALUATION AUTHORITIES VIDE LETTER DT. 4.8.2010 SENT THE READY RECKONER RATES. THE AO FOUND THAT THE RATES PREVAILING DURING THE PERIOD I N CONSIDERATION WAS 6300 PER SQ.FT. AND THE TOTAL CONSIDERATION WAS WOR KED OUT AT RS. 1.58 CRORES. AS THE AO FOUND THAT THE ASSESSEE HAS UNDE R VALUED THE PROPERTY BY 65%, THE MATTER WAS REFERRED TO THE GOVERNMENT V ALUATION OFFICER FOR DETERMINATION OF FAIR MARKET VALUE. THE VALUATION O FFICER VIDE LETTER DT. 22.12.2010 HAS ESTIMATED THE CONSOLIDATED VALUE OF THE PROPERTIES UNDER CONSIDERATION AT RS. 1,49,97,000/-. THE AO RECOMPU TED THE LONG TERM CAPITAL GAIN BY TAKING SALE CONSIDERATION AS PER TH E VALUATION OFFICERS REPORT AND THE NET LONG TERM CAPITAL GAIN WAS RECOM PUTED AT RS. 97,35,560/-. 4. THE ASSESSEE CARRIED THE MATTER BEFORE THE LD. C IT(A) BUT WITHOUT ANY SUCCESS. 5. BEFORE US, THE LD. COUNSEL FOR THE ASSESSEE CLAI MED THAT THE VALUATION OFFICER HAS VIOLATED THE PRINCIPLE OF NAT URAL JUSTICE BY NOT AFFORDING REASONABLE OPPORTUNITY OF BEING HEARD BEF ORE DETERMINING THE FAIR MARKET VALUE OF THE PROPERTY. TO SUBSTANTIATE , THE LD. COUNSEL DREW OUR ATTENTION TO THE NOTICE ISSUED BY THE VALUATION OFFICER AND THE ORDER U/S. 55A OF THE ACT PASSED BY THE VALUATION OFFICER . ITA NO. 514/M/2012 3 6. IN TURN, THE LD. DEPARTMENTAL REPRESENTATIVE SUP PORTED THE ASSESSMENT ORDER. 7. WE HAVE GONE THROUGH THE ASSESSMENT ORDER AND TH E ORDER OF THE FIRST APPELLATE AUTHORITY AND THE RELEVANT DOCUMENT ARY EVIDENCES BROUGHT TO OUR NOTICE. WE FIND THAT THE NOTICE U/S.55A OF THE ACT IS DT.22.12.2010 BY WHICH THE ASSESSEE WAS ASKED TO APPEAR BEFORE TH E VALUATION OFFICER ON OR BEFORE 29.12.2010. IN HIS ORDER U/S. 55A O F THE ACT, THE VALUATION OFFICER REFERS TO HIS NOTICE DT. 22.12.2010 AND ALS O MENTIONED THAT THE ASSESSEE WAS ASKED TO APPEAR ON OR BEFORE 22.12.20 10. HOWEVER, IN THE NOTICE DT. 22.12.2010, THE VALUATION OFFICER ASKED THE ASSESSEE OF APPEAR OR OR BEFORE 29.12.2010 AND THE ASSESSMENT ORDER IS DT. 28.12.2010. THUS, IT CAN BE SEEN THAT THERE IS DEFINITELY VIOLATION O F PRINCIPLES OF NATURAL JUSTICE. WE, THEREFORE, RESTORE THE ISSUE TO THE F ILE OF THE AO. THE AO IS DIRECTED TO DIRECT THE VALUATION OFFICER TO GIVE A FAIR AND REASONABLE OPPORTUNITY TO THE ASSESSEE TO PRESENT HIS CASE AND DECIDE THE ISSUE AFRESH AFTER GIVING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 8. SINCE WE HAVE RESTORED THE ISSUE TO THE FILE OF THE AO, WE DO NOT FIND IT NECESSARY TO DECIDE THE OTHER ISSUES RAISED VIDE GROUND NO. 2 & 3. 9. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT AT THE TIME OF H EARING ON 22 ND JANUARY, 2015 SD/- SD/- (JOGINDER SINGH ) (N.K. BILLAIYA) /JUDICIAL MEMBER '' / ACCOUNTANT MEMBER MUMBAI; 5! DATED : 22 ND JANUARY, 2015 . ! . ./ RJ , SR. PS ITA NO. 514/M/2012 4 '4 '4 '4 '4 0 00 0 -1# -1# -1# -1# 6'#)1 6'#)1 6'#)1 6'#)1 / COPY OF THE ORDER FORWARDED TO : 1. *, / THE APPELLANT 2. -.*, / THE RESPONDENT. 3. 7 ( ) / THE CIT(A)- 4. 7 / CIT 5. #8 -1! , , / DR, ITAT, MUMBAI 6. 9 : / GUARD FILE. '4! '4! '4! '4! / BY ORDER, .#1 -1 //TRUE COPY// ; ;; ; / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI