Shri Haresh Jadavji Ghadia, Rajkot V. The Income Tax Officer, Ward-5(1), Rajkot

ITA 59/RJT/2019

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 9782 (ITAT-RAJKOT)
• Duration Of Justice: 3 year(s) 6 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-09-2022
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: DB
• Assessment Year: misc
• Appeal Filed On: 14-03-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Sale consideration of property below Jantri Value; Opportunity of being heard; Fair market value
• Section: 50C

Judgement Text

ITA No.59/RJT/2019 Assessment Year: 2006-07 Page 1 of 4 IN THE INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH, RAJKOT (Conducted through E-Court at Ahmedabad) BEFORE Ms. SUCHITRA KAMBLE, JUDICIAL MEMBER AND SHRI WASEEM AHMED, ACCOUNTANT MEMBER ITA No.59/RJT/2019 Assessment Year: 2006-07 Haresh Jadavaji Ghadia, vs. Income Tax Officer, C/o. D.R. Adhia, Ward – 5(1), Rajkot. “Om Shri Padmalaya”, Trikamraiji Haweli, 16, Jagnath Plot, Dr. Yaganik Road, Opp. Imperial Hotel, Rajkot - 360 001. [PAN – ABSPG 1858 M] (Appellant) (Respondent) Assessee by : Written Submission Revenue by : Shri B.D. Gupta, DR Date of hearing : 05.09.2022 Date of pronouncement : 28.09.2022 O R D E R PER SUCHITRA KAMBLE, JUDICIAL MEMBER : This appeal is filed by the Assessee against the order dated 26.12.2018 passed by the CIT(A)-3, Rajkot for the Assessment Year 2006-07. 2. The Assessee has raised the following grounds of appeal: “1. The Ld. CIT(A) has erred in law and facts in confirming addition of Rs.3,47,300/- (LTCG 3,81,4377- - 34,137-). The addition needs deletion. 2. The Ld. CIT(A) has erred in law and facts in confirming addition of Rs.3,47,300/- based on factual position which he described wrongly. The addition needs deletion. 3. The Ld. CIT\(A) has erred in law and facts in confirming addition of Rs.3,47,300/- erroneously applying provisions of section 50C which he described wrongly. The addition needs deletion ITA No.59/RJT/2019 Assessment Year: 2006-07 Page 2 of 4 4. The Ld. CIT(A) has erred in law and facts in confirming addition of Rs.3,47,300/- based on presumption and surmises and against the settled position. The addition needs deletion. 5. The Ld. CIT(A) has erred in law and facts in not passing a speaking order in respect of valuation made by the Ld. AVO as to how he accept the high valuation made by the Ld. AVO without considering the valuation made by the register valuer report whereof as submitted before the Ld. A.O. as mentioning assessment order itself. The order needs cancellation. 6. The Ld. CIT(A) has erred in law and facts in not giving an opportunity to the appellant to rebut the valuation made by the Ld. AVO. The order needs cancellation. 7. The Ld. CIT(A) has erred in law and facts and not passing a speaking and reasoned order as to how is not accepting the valuation report furnished by the appellant made by the registered valuer. The order needs cancellation 8. Taking into consideration the legal, statutory, factual and administrative aspects, no addition of an amount of Rs.3,47,300/- ought to have been made. The additions need deletion. 9. Without prejudice, the assessment made is bad in law and deserves annulment. 10. Without prejudice, no reasonable opportunity has been given by the Ld. CIT (A) at appellate stage. The assessment order needs annulment. 11. Without prejudice, no adequate, sufficient and reasonable opportunity has been provided. The assessment needs annulment. 12. Without prejudice, the assessment is framed beyond statutory time limit. The assessment needs annulment.” 3. The assessee filed return of income showing total income of labour work income, interest/salary income from the Firm, interest income from others and long term capital gain (LTCG) of Rs.91,720/- and the same was filed on 27.09.2006. The Assessing Officer made observation that during the F.Y. 2005-06 the assessee sold house property vide Sale Deed No.2706 dated 20.05.2006 for R.7,00,000/-. However, the Stamp Duty Authority has adopted the value of the property for stamp duty purpose at Rs.12,60,089/- in the return filed on 27.09.2016. The assessee has worked out the LTCG considering the sale value at Rs.7,00,000/- and shown ITA No.59/RJT/2019 Assessment Year: 2006-07 Page 3 of 4 Rs.34,137/- as LTCG on above said property. Therefore, the Assessing Officer made addition of Rs.6,65,863/- in respect of fair market value as per AVO’s report . 4. Being aggrieved by the assessment order, the assessee filed appal before the CIT(A). The CIT(A) dismissed the appeal of the assessee. 5. At the time of haring none appeared on behalf of the assessee but the Ld. AR of the assessee filed written submission which is reproduced as under :- “Written Submissions: 1. The assessee declared long term capital gain of Rs.34137 in respect out of sold value of house property. 2. The LTCG disclosed by the assessee is as per sale deed it of Rs.700000. The stamp duty authority adopted the value at Rs.1260089 the Ld AO referred the matter to the departmental AVO who valued the property at Rs.1047300. The Ld AO accepted this value and made addition of Rs.381437 as LTCG as against shown of Rs.34137. 3. Thus adoption of value of Rs1047300 determined by the Ld AVO is accepted without providing any opportunity to make any submissions /objection from the assessee the Hon. ITAT Indore in the case of Krishnakant Shukla ITA No. 100/IND/2017 has been pleased to re-iterate that It is a well settled principle of natural justice that nobody should be condemned unheard. Principle of natural justice requires sufficient opportunity of being heard should be provided to the assessee before deciding the issue against him. 4. The Hon. ITAT E-Bench Rajkot in the case of Vipulkumar Vinodrai Dhakan ITA No.180/Rjt/2018 order dated 31/05/2022 has been pleased to hold that Since the order of the CIT(A) is an Ex-parte order and has lack of reasoning, did not pass order on merit and to our opinion, same is amount to miscarriage of justice. 5. Thus it stands established that adoption of value as per Ld. AVO’s report without providing opportunity to the assessee is against judicial and statutory guidelines needs deletion. 6. The appeal may therefore kindly be allowed as prayed before.” 6. The Ld. DR relied upon the assessment order and the order of the CIT(A). 7. We have heard the Ld. DR and perused all the relevant material available on record. The CIT(A) passed the order ex-parte on merit. It will be appropriate to remand back the issues contested by the assessee as acceptance of AVO’s report by ITA No.59/RJT/2019 Assessment Year: 2006-07 Page 4 of 4 the Assessing Officer was not confronted to the assessee during the assessment proceedings. Further, in the interest of justice we remand back the issues to the file of the Assessing Officer for proper adjudication of the issue on merit. Needless to say the assessee be given opportunity of hearing by following the principles of natural justice. We further direct the assessee to co-operate with the Assessing Officer and make proper representation and if the assessee failed to do so, the Assessing Officer can take cognisance and pass appropriate order as per law. 8. In the result, appeal of the assessee is partly allowed for statistical purpose. Order pronounced in the open Court on this 28 th day of September, 2022. Sd/- Sd/- (WASEEM AHMED) (SUCHITRA KAMBLE) Accountant Member Judicial Member Ahmedabad, the 28 th day of September, 2022 PBN/* Copies to: (1) The appellant (2) The respondent (3) CIT (4) CIT(A) (5) Departmental Representative (6) Guard File By order UE COPY Assistant Registrar Income Tax Appellate Tribunal Rajkot Bench, Rajkot