ACIT, New Delhi V. Shri Subhash Chander Kanwar, New Delhi

ITA 5557/DEL/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 58688 (ITAT-DELHI)
• Duration Of Justice: 2 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-02-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: G
• Assessment Year: 2008-2009
• Appeal Filed On: 09-12-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MRS ANUSHA KHURANA
• Keywords: Capital asset; Gift; Cost of acquisition

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH : G : NEW DELHI BEFORE SHRI I.P. BANSAL, JUDICIAL MEMBER AND SHRI K.D. RANJAN, ACCOUNTANT MEMBER ITA NO.5557/DEL/2011 ASSESSMENT YEAR : 2008-09 ACIT, CIRCLE 24 (1), ROOM NO.238-B, 2 ND FLOOR, CR BLDG., IP ESTATE, NEW DELHI. VS. SUBHASH CHANDER KANWAR, C/O SHRI SUDHIR SINGH SILWAL, F-27, HAUZ KHAS ENCLAVE, NEW DELHI. PAN : AAGPK1000J (APPELLANT) (RESPONDENT) ASSESSEE BY : NONE REVENUE BY : MRS. ANUSHA KHURANA, SR.DR ORDER PER I.P. BANSAL, JUDICIAL MEMBER THIS IS AN APPEAL FILED BY THE REVENUE. IT IS DIRECT ED AGAINST THE ORDER PASSED BY THE CIT (A) DATED 30 TH SEPTEMBER, 2011 FOR ASSESSMENT YEAR 2008-09. THE GROUNDS OF APPEAL READ AS U NDER:- 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE LEARNED C IT (A) HAS ERRED IN DELETING THE ADDITION OF RS.35,44,032/- M ADE BY THE A.O. IN DETERMINING THE INDEX COST OF ACQUISITION WITH R EFERENCE TO THE COST OF INFLATION INDEX APPLICABLE FOR THE A.Y. 1 988-89 AS AGAINST COST INFLATION INDEX APPLICABLE FOR THE F.Y. 19 81-82 IN WHICH THE PREVIOUS OWNER FIRST HELD THE ASSET. 2. THE APPELLANT CRAVES LEAVE TO ADD, ALTER OR AMEND A NY OF THE GROUNDS OF APPEAL BEFORE OR DURING THE COURSE OF THE HEARING OF THE APPEAL. 2. THE ASSESSEE COMPUTED THE LONG-TERM CAPITAL GAIN IN RESPECT OF SALE OF PROPERTY NO. L-1/4, HAUZ KHAS ENCLAVE, NEW DE LHI AT ` ITA NO.5557/DEL/2011 2 49,73,217/-. THE IMPUGNED PROPERTY BEING FIRST AND SECOND FLOOR OF THE AFOREMENTIONED PROPERTY WAS SOLD AT A SUM OF ` 1,35,00 ,000/- EACH AS ON 22 ND NOVEMBER, 2007 AND 28 TH JANUARY, 2008. INDEXED COST WAS CALCULATED ON THE BASIS OF COST INFLATION INDEX FOR TH E YEAR 1981 BY REFERRING TO THE PROVISIONS OF EXPLANATION (III) TO S ECTION 48 OF IT ACT. HOWEVER, THE ASSESSING OFFICER, TAKING NOTE OF THE FACT THAT THE SAID ASSET WAS FIRST HELD BY THE ASSESSEE FROM FINANCIAL YEAR 19 87-88, THE INDEX COST WAS TAKEN FROM THAT YEAR AND ADDITION ON T HAT ACCOUNT WAS MADE OF ` 35,44,032/-. LEARNED CIT (A) HAS ALLOWED THE RELIEF TO THE ASSESSEE ON THE BASIS OF SPECIAL BENCH DECISION OF ITAT IN THE CASE OF MANJULA J. SHAH 318 ITR 417 WHEREIN REFERRING TO TH E PROVISIONS OF EXPLANATION 1 (I) (B) TO SECTION 2 (42A), EXPLANATI ON (III) TO SECTION 48, SECTION 49(1) AND SECTION 55 (2) (B) (II) IT HAS BEE N HELD THAT IN THE CASES OF CAPITAL ASSETS ACQUIRED THROUGH GIFTS, INHERITAN CE, ETC., FOR THE PURPOSE OF COMPUTING LONG-TERM CAPITAL GAINS, THE FIR ST YEAR IN WHICH THE CAPITAL ASSET WAS HELD BY THE ASSESSEE HAS TO BE DETERM INED TO WORK OUT THE INDEX COST OF ACQUISITION AFTER TAKING I NTO ACCOUNT THE PERIOD FOR WHICH THE CAPITAL ASSET WAS HELD BY THE PRE VIOUS OWNER. TAKING NOTE OF THE FACT WHICH WAS STATED IN THE STATEM ENT OF FACTS, THAT THE IMPUGNED PROPERTY WAS INHERITED BY THE ASSESSEE FROM HIS FATHER THROUGH HIS LAST WILL DATED 15 TH DECEMBER, 1987. THE HISTORY OF THE PROPERTY HAS BEEN NARRATED IN THE ASSESSMENT ORDER IN PA RA 4 WHICH IS AS UNDER:- 4. ON GOING THROUGH THE DETAILS FILED BY THE ASSESSEE, IT IS NOTICED THAT A PLOT OF LAND BEARING NO.4 IN BLOCK NO.L- 1 IN COLONY HAUZ KHAS ENCLAVE ADMEASURING 536 SQ. YDS. WAS TRANS FERRED BY M/S DLF HOUSING CONSTRUCTION LTD. BY WAY OF SALE DEED DT. 9 TH APRIL, 1956 IN FAVOUR OF LATE SMT. KAMLAWATI KANWAR W/ O LATE SHRI PRITHVI NATH KANWAR. SMT. KAMLAWATI KANWAR, MOTHER OF THE ASSESSEE CONSTRUCTED ONE HALF STROEYS ON THE SAID PLOT. SMT. KAMLAWATI KANWAR DIED IN 1974 LEAVING BEHIND HER THRE E DAUGHTERS AND ONE SON AS WELL AS HER HUSBAND SH. PRI THVI NATH KANWAR AS HER LEGAL HEIRS. THE SON AND DAUGHTERS OF SHRI KAMLAWATI KANWAR DISCLAIMED/RELINQUISHED ALL RIGHTS, TITLE AND INTEREST IN THE SAID PROPERTY IN FAVOUR OF THEIR FATHER S HRI PRITHVI ITA NO.5557/DEL/2011 3 NATH KANWAR, SHRI PRITHVI NATH KANWAR DIED ON 17.01.19 88 HAVING LEFT HIS LAND WILL DATED 15.12.1987 BEQUEATHING THE SAID PROPERTY TO HIS SON SHRI SUBHASH CHANDRA KANWAR (THE ASSESSEE). 3. THE NOTICE OF HEARING WAS SENT TO THE ASSESSEE, HOWEVE R, NONE WAS PRESENT ON BEHALF OF THE ASSESSEE. SINCE THE ISSUE SEEM S TO BE COVERED, WE PROCEEDED TO DECIDE THIS APPEAL EX PARTE QUA THE ASSESSEE ON MERITS. 4. THE LEARNED DR AFTER NARRATING THE FACTS AND RELY ING UPON THE ORDER OF ASSESSING OFFICER CONTENDED THAT THE ASSESSING OFF ICER WAS RIGHT IN COMPUTING THE INDEXED COST ONLY FROM THE YE AR WHEN THE ASSET WAS HELD BY THE ASSESSEE AND LEARNED CIT (A) HAS WRONGLY GRANTED THE RELIEF TO THE ASSESSEE. THEREFORE, SHE SUBMITTED THAT TH E RELIEF GIVEN BY THE LEARNED CIT (A) SHOULD BE SET ASIDE AND THE ORD ER OF THE ASSESSING OFFICER BE RESTORED. 5. IT IS CLEAR FROM THE HISTORY OF THE PROPERTY THAT THE IMPUGNED PROPERTY WAS OWNED BY THE PREVIOUS OWNER MUCH BEFORE 1.4.1981 AND IT IS AN INHERITED PROPERTY BY THE ASSESSEE. IN VIEW OF THESE FACTS, THE ISSUE IS SQUARELY COVERED BY THE AFOREMENTIONED DECISION OF THE SPECIAL BENCH ON THE BASIS OF WHICH THE RELIEF HAS BEE N GRANTED BY THE CIT (A). THEREFORE, WE DECLINE TO INTERFERE IN THE FINDINGS RECORDED BY THE LEARNED CIT (A) AND THE APPEAL FILED BY THE REV ENUE IS DISMISSED BEING DEVOID OF MERITS. 6. IN THE RESULT, THE DEPARTMENTAL APPEAL IS DISMISSED. THE ORDER PRONOUNCED IN THE OPEN COURT ON 17.02.20 12. SD/- SD/- [K.D. RANJAN] [I.P. BANSAL] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED, 17.02.2012. DK ITA NO.5557/DEL/2011 4 COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT TRUE COPY BY ORDER, DEPUTY REGISTRAR, ITAT, DELHI BENCHES