BHUPENDRA M BHATE, MUMBAI V. DCIT 26(2), MUMBAI

ITA 6170/MUM/2011

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 8133 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 1 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-10-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 01-07-2014
• Assessment Year: 2007-2008
• Appeal Filed On: 06-09-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ASGHAR ZAIN V P
• Assessee Lawyers: KUMARASWAMY
• Keywords: Sale consideration of property below Jantri Value; Opportunity of being heard; Fair market value
• Section: 50C

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, MUMBAI BEFORE S/SHRI I.P. BANSAL, (JM) AND B.R.BASKARAN (AM) . . , . . , ./I.T.A. NO.6170/MUM/2011 ( / ASSESSMENT YEAR : 2007-08) BHUPENDRA M BHATE, 301, VICTORIA CLASSIC, DALMIA ESTATE, OFF P K ROAD, MULUND WEST, MUMBAI-400080 / VS. DY. COMMISSIONER OF INCOME TAX -26(2), 15/16, B WING , 3 RD FLOOR, MITTAL COURT, NARIMAN POINT, MUMBAI-400021 ( / APPELLANT) .. ( ! / RESPONDENT) ./ '# ./PAN/GIR NO. :AHCPB6218Q $ / ASSESSEE BY: SHRI KUMARASWAMY ! % $ / REVENUE BY:: SHRI ASGHAR ZAIN V P & ' % () / DATE OF HEARING : 7.1.2015 *+ % () /DATE OF PRONOUNCEMENT : 7.1.2015 / O R D E R PER B.R.BASKARAN, ACCOUNTANT MEMBER: THE ASSESSEE HAS FILED THIS APPEAL CHALLENGING THE ORDER DATED 16.06.2011 PASSED BY LD CIT(A)-28, MUMBAI AND IT RE LATES TO THE ASSESSMENT YEAR 2007-08. 2. THE ASSESSEE IS AGGRIEVED BY THE DECISION OF LD CIT(A) IN CONFIRMING THE CAPITAL GAINS WORKED OUT BY THE ASSESSING OFFIC ER. 3. WE HEARD THE PARTIES AND PERUSED THE RECORD. THE FACTS ARE THAT THE ASSESSEE HAS HELD 1/8 TH SHARE ON AN ANCESTRAL PROPERTY INHERITED FROM MATERNAL GRAND MOTHER. THE SAME WAS SOLD DURING TH E FINANCIAL YEAR RELEVANT TO THE ASSESSMENT YEAR UNDER CONSIDERATION FOR A SUM OF RS.171 ITA NO.6170/M/11 2 LAKHS AND THE ASSESSEE RECEIVED A SUM OF RS.21.20 L AKHS AS HIS SHARE. THE ASSESSEE INVESTED ENTIRE CONSIDERATION RECEIVED BY HIM IN REC BONDS ON 31.7.2006 AND ACCORDINGLY CLAIMED EXEMPTION U/S 54E C OF THE ACT. ACCORDINGLY HE DID NOT DECLARE ANY CAPITAL GAIN. T HE AO NOTICED THAT THE CONSIDERATION DETERMINED BY THE STAMP AUTHORITY FOR STAMP DUTY VALUATION PURPOSE WAS RS.201.42 LAKHS. THUS THE ASSESSEES S HARE ON THE DIFFERENCE BETWEEN THE STAMP DUTY VALUATION AND THE SALE CONSI DERATION WAS RS.3,33,375/- AND THE ASSESSING OFFICER ADDED THE S AME TO THE TOTAL INCOME OF THE ASSESSEE. THE LD CIT(A) ALSO CONFIRM ED THE SAME. 4. THE SUBMISSION OF THE ASSESSEE IS THAT THE IMPUG NED PROPERTY WAS PURCHASED PRIOR TO 1984 . HE SUBMITTED THAT THE AS SESSEE IS ENTITLED TO DEDUCT THE INDEXED COST OF FAIR MARKET VALUE AS ON 1.4.1981 AGAINST THE SALE CONSIDERATION DETERMINED U/S 50C AND THERE AFT ER THE DEDUCTION U/S 54EC SHOULD BE ALLOWED. HE SUBMITTED THAT THE ASSE SSING OFFICER, WITHOUT COMPUTING THE LONG TERM CAPITAL GAIN AS PER THE ABO VE SAID METHODOLOGY, HAS ADDED THE SUM OF RS.3,33,375/- WITHOUT COMPUTIN G THE LONG TERM CAPITAL GAIN AS PER THE METHODOLOGY PROVIDED IN THE ACT. HE SUBMITTED THAT THE PROVISIONS OF SEC. 50C PROVIDE FOR SUBSTIT UTION OF SALE CONSIDERATION ONLY AND DO NOT PROVIDE FOR ADDITION OF THE DIFFERENCE, IF ANY. ACCORDINGLY HE SUBMITTED THAT THE MATTER OF COMPUTA TION OF LONG TERM CAPITAL GAIN REQUIRES RECONSIDERATION. 5. WE ALSO HEARD LD D.R. HOWEVER, WE FIND MERI T IN THE SUBMISSIONS MADE BY LD A.R. APPARENTLY, THE ASSESSING OFFICER HAS ADDED THE DIFFERENCE VALUE OF SALE CONSIDERATION OF RS.3,33,3 75/- TO THE TOTAL INCOME OF THE ASSESSEE WITHOUT ADDING THE SAME TO THE ASSE SSEES SHARE OF SALE CONSIDERATION AND ALSO WITHOUT COMPUTING THE CAPITA L GAIN IN ACCORDANCE WITH THE PROVISIONS OF THE ACT. WE NOTICE THAT THE LD CIT(A) HAS DISMISSED THE APPEAL OF THE ASSESSEE ON THE REASONING THAT TH E ASSESSEE HAS FAILED TO FURNISH THE DETAILS. HE HAS ALSO NOT EXAMINED ABOU T THE COMPUTATION OF ITA NO.6170/M/11 3 LONG TERM CAPITAL GAIN. HENCE, WE ARE OF THE VIEW THAT THIS ISSUE REQUIRES FRESH EXAMINATION AT THE END OF THE ASSESSING OFFIC ER. ACCORDINGLY, WE SET ASIDE THE ORDER OF LD CIT(A) AND RESTORE THE SAME T O THE FILE OF THE AO WITH THE DIRECTION TO COMPUTE THE CAPITAL GAIN IN A CCORDANCE WITH THE LAW AFTER AFFORDING ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 6. IN THE RESULT, THE APPEAL FILED BY THE ASSES SEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. THE ABOVE ORDER WAS PRONOUNCED IN THE OPEN COURT ON 7 TH JAN, 2015. *+ & , - . 7TH JAN, 2015 + % /' 0 SD SD ( . . /I.P. BANSAL ) ( . . ,/ B.R. BASKARAN ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER & ' MUMBAI: 7 TH JAN,2015. . . ./ SRL , SR. PS ! / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. ! / THE RESPONDENT. 3. & 3( ( ) / THE CIT(A)- CONCERNED 4. & 3( / CIT CONCERNED 5. 6. 45/ (6 , ) 6 , & ' / DR, ITAT, MUMBAI CONCERNED /7 8' / GUARD FILE. 9 & / BY ORDER, TRUE COPY : ' (ASSTT. REGISTRAR) ) 6 , & ' /ITAT, MUMBAI