ACIT, Circle-6(1), Hyderabad V. Sri Rayna Pratap, Hyderabad

ITA 561/HYD/2012

• Counselvise Citation: 56122514 RSA 2012
• Duration Of Justice: 2 year(s) 7 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-11-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2008-2009
• Appeal Filed On: 16-04-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJAT MITRA
• Assessee Lawyers: M V ANIL KUMAR
• Keywords: Fair market value

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B, HYDERABAD BEFORE SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER ITA NO. 561/HYD/2012 ASSESSMENT YEAR : 2008-09 ASST. COMMISSIONER OF INCOME- TAX, CIRCLE 6(1), HYDERABAD SMT. RAYNA PRATAP, HYDERABAD PAN AEJPP5855P (APPELLANT) (RESPONDENT) REVENUE BY SHRI RAJAT MITRA ASSESSEE BY SHRI M.V. ANIL KUMAR DATE OF HEARING 12-11-2014 DATE OF PRONOUNCEMENT 19-11-2014 O R D E R PER SAKTIJIT DEY, J.M.: THIS APPEAL BY THE DEPARTMENT IS DIRECTED AGAINST ORDER DATED 31/01/12 PASSED BY THE COMMISSIONER OF INCOME-TAX( A)-IV, HYDERABAD, FOR THE ASSESSMENT YEAR 2008-09 2. THE ONLY ISSUE RAISED BY THE DEPARTMENT IS THAT LD. CIT(A) HAS ADOPTED THE FAIR MARKET VALUE (FMV) OF THE LAND AT RS. 700 PER SQ.YD. AS AGAINST SRO VALUE OF RS. 80 PER SQ.YD. ADOPTED B Y AO. 3. BRIEFLY THE FACTS RELATING TO ISSUE IN DISPUTE A RE, ASSESSEE AN INDIVIDUAL FILED HER RETURN OF INCOME FOR THE IMPUG NED AY ON 29/08/08 DECLARING TOTAL INCOME OF RS. 54,30,340 AND AGRICUL TURAL INCOME OF RS. 3 LAKH. DURING THE ASSESSMENT PROCEEDING, AO NOTICE D THAT ASSESSEE HAS DECLARED LONG TERM CAPITAL GAIN ON SALE OF LAND SITUATED AT HOUSE 2 ITA NO. 561/HYD/2012 SMT. RAYNA PRATAP NO. 5-9-92 AND 5-9-92/A, CHAPEL ROAD, HYDERABAD. HE FURTHER NOTICED THAT WHILE COMPUTING THE CAPITAL GAIN ASSESSEE HAS ADOPTED THE FMV OF THE LAND AS ON 01/04/1981 AT RS. 900 PER SQ.YD.. WHEN AO CALLED UPON ASSESSEE TO JUSTIFY THE FMV ADOPTED AS ON 01/0 4/1981, AS NOTED BY AO IN THE ASSESSMENT ORDER, ASSESSEE DID NOT FUR NISH ANY INFORMATION. THEREFORE, AO PROCEEDED TO COMPUTE THE CAPITAL GAIN BY ADOPTING FMV AS ON01/04/1981AT RS. 80 PER SQ.YD. FO R RESIDENTIAL PROPERTY AND RS. 250 PER SQ.YD. FOR COMMERCIAL PRO PERTY ON THE BASIS OF INFORMATION OBTAINED FROM JOINT SUB-REGISTRAR-I, HYDERABAD VIDE HIS LETTER DATED 16/12/10. BEING AGGRIEVED OF THE A CTION OF AO IN REDUCING THE FMV OF THE LAND TO RS. 80 PER SQ.YD. A ND RS. 250 PER SQ.YD. ASSESSEE CHALLENGED THE SAME IN THE APPEAL P REFERRED BEFORE LD. CIT(A). 4. IN COURSE OF HEARING OF APPEAL BEFORE LD. CIT(A) , ASSESSEE RELYING UPON VARIOUS CASE LAWS SUBMITTED THAT SRO V ALUE CANNOT BE STATED TO BE THE FMV AS ON 01/04/1981. LD. CIT(A) A FTER CONSIDERING THE SUBMISSIONS OF ASSESSEE IN THE CONTEXT OF FMV A DOPTED IN VARIOUS ORDERS OF ITAT, HYDERABAD BENCHES IN RESPECT OF LAN D LOCATED IN DIFFERENT LOCALITIES OF HYDERABAD FOUND THAT AS PER THE SAID DECISIONS SRO GUIDELINES VALUE AS FIXED IN 1976 WAS NOT REVI SED TILL 1995, HENCE, IT WOULD NOT BE APPROPRIATE TO PLACE RELIANC E THEREON. HE, THEREFORE, HELD THAT AO COULD NOT HAVE ADOPTED THE FMV OF RS. 80 SQ.YD. FOR RESIDENTIAL PROPERTY AND RS. 250 PER SQ. YD. IN RESPECT OF COMMERCIAL PROPERTY BY RELYING UPON BASIC VALUE REG ISTER. HE FURTHER OBSERVED THAT AO HAS NOT BEEN ABLE TO BRING ANY COM PARATIVE INSTANCES OF SALE/PURCHASE AT THE RATE SHOWN IN THE BASIC VALUE REGISTER IN THE VICINITY OF ASSESSEES PROPERTY. HE FURTHER OBSERVED THAT AO ALSO DID NOT ASSIGN ANY REASON WHY HE ADOPT ED THE RATE OF RS. 80 PER SQ.YD. FOR ONE PART OF LAND HELD INDIVID UALLY BY ASSESSEE WHILE ADOPTING RS. 250 PER SQ.YD. FOR THE OTHER PAR T OF LAND JOINTLY SOLD BY ASSESSEE AND HER TWO SONS. LD. CIT(A) NOTICED TH AT IN CASE OF ASVHIN DATLA VS. ITO, ITAT, HYDERABAD BENCH WHILE CONSIDERING THE 3 ITA NO. 561/HYD/2012 SMT. RAYNA PRATAP APPROXIMATE FMV OF LAND SITUATED AT KUKATPALLY HAS NOTED THAT GUIDELINE VALUE IN THE YEAR 2006 AS PER SRO WAS RS. 3700 PER SQ.YD AND THE VALUATION OFFICER AFTER CONSIDERING THE FAC TORS HAD ESTIMATED THE VALUE AS ON 01/04/1981 AT RS. 750 PER SQ.YD. LD . CIT(A) TOOK NOTE OF ITAT, HYDERABAD DECISION IN CASE OF SMT. G. VIJA YA & OTHERS WHEREIN WHILE CONSIDERING THE ACTUAL FMV VALUE OF L AND SITUATED IN ABIDS AREA WHERE ASSESSEES LAND WAS ALSO SITUATED, ITAT ADOPTED THE RATE OF RS. 1830 PER SQ.YD. AS PER THE VALUERS REPORT AS AGAINST HIGHEST SALE INSTANCE OF RS. 2100 PER SQ.YD. LD. CI T(A), THEREFORE, CONSIDERING THE FACT THAT IN CASE OF ASHVIN DATLA V S. ITO WHERE THE PROPERTY SITUATED AT A FAR OFF PLACE I.E. KUKATPALL Y, THE TRIBUNAL HAS ESTIMATED FMV AT RS. 750 COMPARED TO WHICH ASSESSEE S PROPERTY IS IN A FAR BETTER PLACE ADOPTED THE FMV OF THE LAND A T RS. 700 PER SQ.YD. IN RESPECT OF THE ENTIRE PROPERTY SOLD. 5. WE HAVE HEARD THE PARTIES AND PERUSED THE ORDERS OF REVENUE AUTHORITIES AS WELL AS RELEVANT MATERIAL ON RECORD. UNDISPUTEDLY, ON THE BASIS OF INFORMATION OBTAINED FROM SRO, AO HAS ADOPTED FMV OF RS. 80 PER SQ.YD.SO FAR AS ASSESSEES INDIVIDUAL PR OPERTY IS CONCERNED AND RS. 250 PER SQ.YD. IN RESPECT OF PROPERTY HELD JOINTLY WITH HER SONS, THOUGH THE LAND IS SITUATED IN THE SAME YEAR. AO HAS NOT GIVEN ANY REASON WHY HE ADOPTED TWO DIFFERENT RATES FOR T HE SAME PROPERTY. IT IS ALSO A FACT ON RECORD THAT AO WHILE ACCEPTING THE GUIDELINE VALUE AND REJECTING FMV ADOPTED HAS NOT MADE ANY EFFORT T O FIND OUT THE ACTUAL FMV IN THE PARTICULAR LOCALITY BY BRINGING A NY COMPARATIVE INSTANCES OF SALE OR PURCHASE OF PROPERTY AS ON 01/ 04/1981. BY SIMPLY RELYING UPON THE INFORMATION RECEIVED FROM SRO, AO HAS ADOPTED FMV AT RS. 80 PER SQ.YD. AND RS. 250 PER SQ.YD. IN RESPECT OF RESIDENTIAL AND COMMERCIAL LAND RESPECTIVELY. AS RI GHTLY OBSERVED BY LD. CIT(A), SRO GUIDELINE VALUE CANNOT BE CONSIDERE D TO BE REFLECTING THE REAL FMV OF THE PROPERTY IN A PARTICULAR AREA C ONSIDERING THE FACT THAT SRO VALUE AS FIXED IN THE YEAR 1976 WAS NOT RE VISED TILL 1995. THESE FACTORS WERE CONSIDERED BY ITAT, HYDERABAD BE NCH WHILE 4 ITA NO. 561/HYD/2012 SMT. RAYNA PRATAP ADOPTING FMV AT RS. 750 PER SQ.YD. AS ON 01/04/1981 AT KUKATPALLY WHILE DECIDING THE CASE OF ASVEN DATLA VS. ITO, WHI CH WAS SUBSEQUENTLY CONFIRMED BY THE HONBLE AP HIGH COURT . IT IS ALSO A FACT THAT ITAT WHILE DECIDING THE CASE OF SMT. G. VIJAYA AND OTHERS VS. DCIT IN ITA NO. 276/H/03 DATED 27/08/2005 WHILE CON SIDERING THE ISSUE OF DETERMINATION OF FMV AS ON 01/04/81 IN RES PECT OF PROPERTY LOCATED IN ABIDS, WHICH IS NEAR TO THE PROPERTY BEL ONGING TO ASSESSEE ADOPTED FMV AT RS. 1380 PER SQ.YD. AS ON 01/04/1981 . CONSIDERED IN THE AFORESAID PERSPECTIVE, ADOPTION OF FMV AT RS. 7 00 PER SQ.YD. BY LD. CIT(A) FOR THE ENTIRE PROPERTY, IN OUR VIEW, IS FAIR AND REASONABLE, HENCE, DO NOT CALL FOR ANY INTERFERENCE. SO FAR AS DECISIONS RELIED UPON BY THE DEPARTMENT ARE CONCERNED, ON CAREFUL EX AMINATION, WE FIND THEM TO BE FACTUALLY DISTINGUISHABLE, HENCE, W ILL NOT APPLY TO THE FACTS OF THE PRESENT CASE. ACCORDINGLY, WE UPHOLD T HE ORDER OF LD. CIT(A) WHILE DISMISSING THE GROUNDS RAISED BY DEPAR TMENT. 6. IN THE RESULT, APPEAL OF THE DEPARTMENT IS DISMI SSED. PRONOUNCED IN THE OPEN COURT ON 19/11/2014. SD/- SD/- (B. RAMAKOTAIAH) (SAKTIJIT DEY) ACCOUNTANT MEMBER JU DICIAL MEMBER HYDERABAD, DATED: 19 TH NOVEMBER, 2014 KV COPY TO:- 1) ACIT, CIRCLE 6(1), 7 TH FLOOR, D BLOCK, IT TOWERS, AC GUARDS, HYDERABAD. 2), SMT. RAYNA PRATAP, 108, SURVEY NO. 25, HILL RID GE VILLAS, ST. NO. 8, KANCHA GACHIBOWLI, HYDERABAD. 3) CIT(A)-IV, HYDERABAD 4) CIT-III, HYDERABAD 5)THE DEPARTMENTAL REPRESENTATIVE, I.T.A.T., HYDER ABAD. 5 ITA NO. 561/HYD/2012 SMT. RAYNA PRATAP DESCRIPTION DATE INTLS 1. DRAFT DICTATED ON SR.P.S. 2. DRAFT PLACED BEFORE AUTHOR SR.P.S 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER VP 5 APPROVED DRAFT COMES TO THE SR.P.S./PS SR.P.S. 6. KEPT FOR PRONOUNCEMENT ON SR.P S. 7. FILE SENT TO THE BENCH CLERK SR.P.S. 8 DATE ON WHICH FILE GOES TO THE HEAD CLERK 9 DATE OF DISPATCH OF ORDER