ITO (IT) 4(1), MUMBAI V. DARSHNA HARGOVINDBHAI PATEL, MUMBAI

ITA 5754/MUM/2012

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 71743 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 2 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-11-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Assessment Year: 2009-2010
• Appeal Filed On: 14-09-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANJEEV JAIN
• Keywords: Gift; Cost of acquisition

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, MUMBAI BEFORE S/SHRI B.R.MITTAL,(JM) AND P.M.JAGTAP (AM) . . , . . , ./I.T.A. NO.5754/MUM/2012 ( / ASSESSMENT YEAR : 2009-10) INCOME TAX OFFICER (INTERNATIONAL TAXATION)-4(1), 139, 1 ST FLOOR, SCINDIA HOUSE, BALLARD PIER, MUMBAI-400038 / VS. SMT. DARSHANA HARGOVINDBHAI PATEL, PLOT NO.22, NEW NAGARDAS ROAD, ANDHERI (E), MUMBAI-400069 ( ' / APPELLANT) .. ( ( ' / RESPONDENT) ./ ./PAN/GIR NO. : AAQPP3536N ' /: REVENUE BY SHRI SANJEEV JAIN ( ' + / ASSESSEE BY NONE + . / DATE OF HEARING : 12.11.2013 + . /DATE OF PRONOUNCEMENT : 22.11.2013 / O R D E R PER B.R.MITTAL, JM: THE DEPARTMENT HAS FILED THIS APPEAL FOR ASSESSMENT YEAR 2009-10 AGAINST THE ORDER OF LD. CIT(A) DATED 6.6.2012 ON FOLLOWING G ROUNDS : 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN HOLDING THAT THE BASE YEAR FOR DETERMINING THE INDEXED COST OF ACQUISITION SHOULD BE FY 1981-82 AS AGAINST FY 2004 -05 DETERMINED BY AO WITHOUT APPRECIATING THE FACT THAT CLAUSE (III) OF EXPLANATION TO THE PROVISO TO SECTION 48 OF THE IT ACT, 1961 SPECIFICALLY ALLOWS INDEXATION FROM THE DATE OF HOLDING OF THE ASSETS BY THE ASSESSEE; 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN HOLDING THAT THE BASE YEAR FOR DETERMINING THE INDEXED COST OF ACQUISITION SHOULD BE FY 1981-82 AS AGAINST FY 2004 -05 DETERMINED BY AO WITHOUT APPRECIATING THE FACT THAT THE RIGHT TO H OLD THE PROPERTY DIVESTED ON THE ASSESSEE ONLY AFTER THE DEMISE OF HER FATHER IN FY 2004-05 AND THUS, FY 2004- 05 WAS THE FIRST YEAR IN WHICH THE ASSET WAS HELD BY THE ASSESSEE. 3. THE APPELLANT PRAYS THAT THE ORDER OF LD. CIT(A ) ON THE ABOVE GROUNDS (S) BE SET ASIDE AND THAT OF THE AO BE RESTORED I.T.A. NO.5754/MUM/2012 2 2. NOTICE OF HEARING WAS SENT TO THE ASSESSEE. AT THE TIME OF HEARING, NONE APPEARED ON BEHALF OF THE ASSESSEE, THEREFORE, WE D ECIDE THIS APPEAL ON MERITS EX-PARTE QUA THE ASSESSEE AFTER HEARING LD. DR AND MATERIAL AVAILABLE ON RECORD. 3. WE OBSERVE THAT IN THE ASSESSMENT YEAR UNDER CON SIDERATION, ASSESSEE SOLD INHERITED PROPERTY AND COMPUTING LONG TERM CAPITAL GAIN CONSIDERING MARKET VALUE AS ON 1.4.1981. THE SAID PROPERTY WAS UNDISPUTEDLY ACQ UIRED BY PREVIOUS OWNER AND ASSESSEE ACQUIRED THE PROPERTY BY WAY OF INHERITANC E FOR THE FINANCIAL YEAR 2004-05. THE ASSESSEE CONTENDED THAT SHE IS ELIGIBLE FOR INDEXAT ION TO COMPUTE CAPITAL GAIN BY TAKING BASE YEAR 1981-82 FOR THE PURPOSE OF INDEXATION. TH E ASSESSING OFFICER DID NOT ACCEPT THE CONTENTION OF ASSESSEE AND CONSIDERED THE YEAR FOR THE PURPOSE OF INDEXATION TO COMPUTE CAPITAL GAIN FROM THE DATE THE PROPERTY WAS INHERITED BY ASSESSEE. 4. IN THE FIRST APPEAL, LD. CIT(A) REVERSED THE O RDER OF AO BY FOLLOWING DECISION OF ITAT SPECIAL BENCH IN THE CASE OF DCIT VS MANJULA J. SHA H 30 DTR (MUM(SB) 601 AFFIRMED BY HONBLE BOMBAY HIGH COURT IN 16 TAXMAN. COM 42. 5. AT THE TIME OF HEARING NONE APPEARED ON BEHALF OF THE ASSESSEE. LD. DR HAS NOT DISPUTED THE FACT SAVE AND EXCEPT RELIED ON THE OR DER OF AO. 6. SINCE HONBLE BOMBAY HIGH COURT IN THE CASE OF M ANJULA J. SHAH (SUPRA) HAS HELD WHILE COMPUTING THE INDEXED COST OF ACQUISITION OF ASSETS SOLD WHICH WAS ACQUIRED UNDER A GIFT, THE ASSESSEE COULD BE ENTITLED TO THE BENEFIT OF INDEXATION FROM THE DATE OF PURCHASE OF ASSET BY THE PREVIOUS OWNER, WE HOLD THAT LD. CIT(A) HAS RIGHTLY CONSIDERED THE DATE OF ACQUISITION OF PROPERTY BY THE PREVIOUS OWNER FOR THE PURPOSE OF APPLYING THE COST OF INDEXATION WHILE COMPUTIN G LONG TERM CAPITAL GAIN, FOR THE INHERITED PROPERTY SOLD BY THE ASSESSEE. HENCE, W E UPHOLD HIS ORDER AND REJECT GROUNDS OF APPEAL TAKEN BY DEPARTMENT. 7. IN THE RESULT, THE APPEAL OF THE REVENUE IS DIS MISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THE 22 ND NOVEMBER, 2013 + 2 3 22 ND NOVEMBER, 2013 + SD. SD/- ( . . / P.M.JAGTAP) ( . . /B.R.MITTAL) / ACCOUNTANT MEMBER / JUDICIAL MEMBER MUMBAI: 22/11/2013 I.T.A. NO.5754/MUM/2012 3 . . ./ SRL , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. ' / THE APPELLANT 2. ( ' / THE RESPONDENT. 3. 6 ( ) / THE CIT(A)- CONCERNED 4. 6 / CIT CONCERNED 5. 7 (9 , . 9 , / DR, ITAT, MUMBAI CONCERNED 6. / GUARD FILE. / BY ORDER, TRUE COPY (ASSTT. REGISTRAR) . 9 , /ITAT, MUMBAI