ITO (IT) 1(2)(1), MUMBAI V. MANMOHAN SADANAND BHATKAL, MUMBAI

ITA 5449/MUM/2016

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 0532 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 4 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-01-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: 2013-2014
• Appeal Filed On: 07-09-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJESH KUMAR YADAV
• Assessee Lawyers: MANMOHAN S BH ATKAL
• Keywords: Cost of acquisition
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH A, MUMBAI BEFORE SHRI G.S.PANNU, ACCOUNTANT MEMBER AND SHRI RAM LAL NEGI, JUDICIAL MEMBER ITA NO. 5449/MUM/2016 (ASSESSMENT YEAR 2013-14) THE ITO (IT)-1(2)(1), ROOM NO.118, 1 ST FLOOR, SCINDIA HOUSE, N.M.ROAD, BALLARD ESTATE, MUMBAI 400 038. ...... APPELLANT VS. MANMOHAN SADANAND BHATKAL, C-1, SARATHI, KHIRA NAGAR, SV ROAD, SANTACRUZ (W) MUMBAI 400 054 PAN: AAHPB1743 J .... RESPONDENT C.O. NO.262/MUM/2017 (ARISING OUT OF ITA NO. 5449/MUM/2016,A.Y.2013-14) MANMOHAN SADANAND BHATKAL, C-1, SARATHI, KHIRA NAGAR, SV ROAD, SANTACRUZ (W) MUMBAI 400 054 PAN: AAHPB1743 J ..... CROSS OBJECTOR VS. THE ITO (IT)-1(2)(1), ROOM NO.118, 1 ST FLOOR, SCINDIA HOUSE, N.M.ROAD, BALLARD ESTATE, MUMBAI 400 038. ...... APPELLANT IN APPEAL ITA NO. 5449/MUM/2016 & CO 262/MUM/16 (ASSESSMENT YEAR 2013-14) 2 REVENUE BY : SHRI RAJESH KUMAR YADAV ASSESSEE BY : SHRI MANMOHAN S. BH ATKAL(ASSESSEE ) DATE OF HEARING : 01/11/2017 DATE OF PRONOUNCEMENT : 30/01/2018 ORDER PER G.S.PANNU,A.M: THE CAPTIONED APPEAL BY THE REVENUE AND CROSS-OBJEC TION BY THE ASSESSEE ARE DIRECTED AGAINST THE ORDER OF CIT(A)-5 5, MUMBAI DATED 26.04.2016, PERTAINING TO ASSESSMENT YEAR 2013-14, WHICH IN TURN HAS ARISEN FROM THE ORDER DATED 31/03/2016 PASSED BY THE ASSES SING OFFICER UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961 (IN SHOR T THE ACT). 2. IN SO FAR AS THE APPEAL OF THE REVENUE IS CONCER NED, THE GROUNDS OF APPEAL READ AS UNDER:- 1. 'WHETHER ON THE FACTS AND CIRCUMSTANCES OF TH E CASE AND IN LAW, THE LD. CIT (A) HAS ERRED IN HOLDING THAT WHILE COMPUTING THE CAPIT AL GAIN ON THE SALE OF INHERITED PROPERTY, THE INDEXED COST OF ACQUISITION HAS TO BE COMPUTED WITH REFERENCE TO THE YEAR IN WHICH THE PREVIOUS OWNER FIRST HELD THE ASS ET AND NOT THE YEAR IN WHICH THE ASSESSEE BECAME THE OWNER OF THE ASSET?' 2. THE APPELLANT PRAYS THAT THE ORDER OF THE LD . CIT (A) BE SET ASIDE ON THE ABOVE GROUNDS AND THAT OF THE ASSESSING OFFICER BE RESTOR ED . 3. BRIEFLY PUT, THE RELEVANT FACTS ARE THAT THE ASS ESSEE HAS SOLD A PROPERTY I.E. FLAT NO.C-2, ANAND ASHRAM, VADILAL PATEL MARG, GRANT ROAD, MUMBAI 400047 FOR A CONSIDERATION OF RS.3.00 CRORES AND RE TURNED LONG TERM CAPITAL GAIN AT RS.2,12,02,674/-. THE ASSESSING OFFICER NO TED THAT ASSESSEE HAD INHERITED THE PROPERTY ON THE DEATH OF HIS MOTHER O N 05/07/2011 AND THAT THE PROPERTY WAS OTHERWISE ACQUIRED BY ASSESSEES GRAND MOTHER PRIOR TO 1981. IN ITA NO. 5449/MUM/2016 & CO 262/MUM/16 (ASSESSMENT YEAR 2013-14) 3 THIS BACKGROUND, ASSESSEE HAD WORKED OUT THE LONG T ERM CAPITAL GAIN BY ADOPTING THE DATE OF ACQUISITION AS 01/01/1981 AND THE INDEXED COST WAS CALCULATED ACCORDINGLY. THE ASSESSING OFFICER DIFF ERED WITH THE ASSESSEE ON THE COMPUTATION OF CAPITAL GAIN, INASMUCH AS, ACCOR DINGLY TO HIM THE INDEXATION WAS REQUIRED TO BE TAKEN FROM THE FINANC IAL YEAR 2011-12 AND NOT FROM 1981. ACCORDINGLY, THE LONG TERM CAPITAL GAIN WAS WORKED OUT BY THE ASSESSING OFFICER AT RS.2,88,79,322/- AS AGAINST RS . RS.2,12,02,674/- WORKED OUT BY THE ASSESSEE. THE CIT(A) NOTED THAT THE ACT ION OF THE ASSESSING OFFICER WAS CONTRARY TO THE JUDGMENT OF THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF CIT VS. MANJULA J. SHAH, 355 ITR 474 (BOM) AND, TH EREFORE, HE SET-ASIDE THE ACTION OF THE ASSESSING OFFICER AND RESTORED THE DE TERMINATION OF CAPITAL GAINS AS DONE BY THE ASSESSEE. AGAINST SUCH A DECISION O F THE CIT(A) THE REVENUE IS IN APPEAL BEFORE US. 4. THOUGH THE GROUND OF APPEAL CANVASSED BY THE REV ENUE IS IN SUPPORT OF THE ACTION OF THE ASSESSING OFFICER BUT THERE IS NO REBUTTAL TO THE FACT THAT THE ISSUE IN QUESTION CONTINUES TO GOVERNED BY THE DECI SION OF THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF MANJULA J. SHAH (SUPRA),A S IT HAS NOT BEEN ALTERED BY ANY HIGHER AUTHORITY. THEREFORE, UNDER THESE CIRCU MSTANCES, WE DO NOT FIND ANY REASON TO INTERFERE WITH THE DECISION OF THE CI T(A), WHICH IS HEREBY AFFIRMED. THUS, THE APPEAL OF THE REVENUE IS DISMI SSED, AS ABOVE. 5. IN SO FAR AS, THE CROSS-OBJECTION FILED BY THE A SSESSEE IS CONCERNED, THE SAME IS MERELY IN SUPPORT OF THE DECISION OF THE CI T(A) AND SINCE WE HAVE ALREADY AFFIRMED HIS DECISION WHILE DECIDING THE AP PEAL OF THE REVENUE, THE CROSS OBJECTION IS RENDERED INFRUCTUIOUS. ITA NO. 5449/MUM/2016 & CO 262/MUM/16 (ASSESSMENT YEAR 2013-14) 4 6. IN THE RESULT, APPEAL OF THE REVENUE AS WELL AS CROSS-OBJECTION OF THE ASSESSEE ARE DISMISSED, AS ABOVE. ORDER PRONOUNCED IN THE OPEN COURT ON 30/01/2018 . SD/- SD/- (RAM LAL NEGI) (G.S. PANNU) JUDICIAL MEMBER ACCOCUNTANT MEMBER MUMBAI, DATED 30/01 /2018 VM , SR. PS COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT , 2. THE RESPONDENT. 3. THE CIT(A)- 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. BY ORDER, //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI