Sh. Rakesh Bajaj, KOTKAPURA V. The Income-tax Officer, Faridkot

ITA 623/ASR/2014

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 0814 (ITAT-AMRITSAR)
• Duration Of Justice: 1 year(s) 6 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-04-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 06-04-2016
• Assessment Year: 2011-2012
• Appeal Filed On: 13-10-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: FAKIR CHAND FATHER O F
• Keywords: Sale consideration of property below Jantri Value; Capital asset; Fair market value
• Section: 50C; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR BEFORE SH. A.D.JAIN, HONBLE JUDICIAL MEMBER AND SH. T.S. KAPOOR, HONBLE ACCOUNTANT MEMBER I.T.A NO.623(ASR)/2014 ASSESSMENT YEAR:2011-12 RAKESH BAJAJ S/O FAQIR CHAND BAJAJ TULSI RAM STREET, NEAR PNB KOTKAPURA-151204(PB.) PAN:ABDPB2737K VS. ITO, WARD III(3), FARIDKOT. (APPELLANT) (RESPONDENT) APPELLANT BY: SH. FAKIR CHAND (FATHER O F ASSESSEE) RESPONDENT BY: SH. TARSEM LAL (DR.) DATE OF HEARING: 06.04.2016 DATE OF PRONO UNCEMENT: 13.04.2016 ORDER PER T. S. KAPOOR (AM): THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINS T THE ORDER OF LEARNED CIT(A), BATHINDA, DATED 24.07.2014, FOR THE ASST. Y EAR 2011-12. 2. THE ASSESSEE HAS TAKEN VARIOUS GROUNDS OF APPEAL , HOWEVER, THE CRUX OF GROUNDS OF APPEAL IS THE ACTION OF LEARNED CIT(A) BY WHICH HE HAD CONFIRMED AN ADDITION OF RS.15,83,000/- MADE BY ASS ESSING OFFICER AS CAPITAL GAIN ON THE SALE OF PROPERTY CALCULATED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 50C(1) OF THE ACT. ITA NO.62 3 (ASR)/2014 ASST. YE AR: 2011-12 2 3. THE BRIEF FACTS OF THE CASE AS NOTED IN THE ASSE SSMENT ORDER ARE THAT THE ASSESSEE PURCHASED HALF SHARE IN A SHOP ON 2.06.2009 IN THE AUCTION BY DEBT RECOVERY TRIBUNAL. THE ASSESSEE SOL D HIS HALF SHARE IN THE PROPERTY FOR A SUM OF RS.14,50,000/- ON 29 TH APRIL, 2010. THE ASSESSING OFFICER ON THE BASIS OF AN INFORMATION AV AILABLE WITH THE DEPARTMENT REOPENED THE CASE OF THE ASSESSEE U/S 14 8 OF THE ACT AND CALCULATED A SHORT TERM CAPITAL GAIN OF RS.15,83,00 0/- ON THE BASIS OF STAMP DUTY VALUATION AS PER THE PROVISIONS OF SECTI ON 50C(1) OF THE ACT. 4. AGGRIEVED WITH THE ASSESSMENT ORDER THE ASSESSEE FILED APPEAL BEFORE THE LEARNED CIT(A), WHO ALSO UPHELD THE ACTI ON OF ASSESSING OFFICER. 5. AGGRIEVED THE ASSESSEE IS IN APPEAL BEFORE US. 6. AT THE OUTSET, THE LEARNED AR SUBMITTED THAT ASS ESSEE HAD PURCHASED A SHOP FROM DEBT RECOVERY TRIBUNAL ON 2.0 6.2009 AND SINCE THERE WAS A DISPUTE IN THE PROPERTY SO HE SOLD THE SAME ON 29 TH APRIL, 2010 AND BETWEEN THIS PERIOD THERE WAS NO CHANGE IN THE COLLECTORS RATE FOR VALUATION OF THE PROPERTY FOR STAMP DUTY PURPOS ES. 7. THE LEARNED AR SUBMITTED THAT THIS SUBMISSION WA S MADE TO ASSESSING OFFICER WHICH IS APPARENT FROM PAGE-2 OF THE ASSESSMENT ORDER WHERE ASSESSING OFFICER HAD NOTED THAT ASSESSEE HAD FILED WRITTEN SUBMISSIONS OBJECTING TO THE APPLICATION OF PROVISI ONS OF SECTION 50C OF THE ACT. THE LEARNED AR FURTHER SUBMITTED THAT SINC E THE PROPERTY WAS ITA NO.62 3 (ASR)/2014 ASST. YE AR: 2011-12 3 DISPUTED AS A CASE WAS PENDING IN THE COURT OF CIVI L DIVISION, MUKTSAR, THEREFORE, THE VALUE DETERMINED FOR THE PURPOSE OF SECTION 50C WOULD NOT REPRESENT THE SALE CONSIDERATION PASSED TO THE SELL ER. HE FURTHER SUBMITTED THAT THE LEARNED CIT(A) HAS DISMISSED THE APPEAL ON THE GROUND THAT ASSESSEE HAS RAISED THE CLAIM ABOUT APP LICABILITY OF PROVISIONS OF SECTION 50C(2)(A) BEFORE HIM AND HAD NOT RAISED IT BEFORE THE ASSESSING OFFICER, WHEREAS THE FACT REMAINS THAT HE HAD RAISED THE ISSUE BEFORE ASSESSING OFFICER THROUGH WRITTEN SUBMISSION S. 8. THE LEARNED DR, ON THE OTHER HAND, SUBMITTED THA T THE PROVISIONS OF SECTION 50C(1) ARE VERY CLEAR WHICH STATES THAT WHERE VALUE ADOPTED BY ASSESSEE IS LESS THAN THE COLLECTOR RATE THE COLLEC TOR RATE HAS TO BE CONSIDERED FOR THE PURPOSES OF WORKING OUT OF CAPIT AL GAIN AND IN VIEW OF THE ABOVE, IT WAS SUBMITTED THAT THE APPEAL OF THE ASSESSEE MAY BE DISMISSED. 9. WE HAVE HEARD THE RIVAL PARTIES AND HAVE GONE TH ROUGH THE MATERIAL PLACED ON RECORD. WE FIND THAT IT IS AN UN DISPUTED FACT THAT ASSESSEE HAD PURCHASED THE SAID PROPERTY IN THE OPE N AUCTION FROM THE DEBT RECOVERY TRIBUNAL, CHANDIGARH ON 2.06.2009 AND HAS SOLD THE SAME PROPERTY ON 29 TH APRIL, 2010 AND IT WAS CLAIMED BEFORE ASSESSING OFFICER THAT THERE WAS NO CHANGE IN THE COLLECTORS RATE FOR VALUATION OF PROPERTY SINCE 2002 TO AUGUST, TO 2010. THE ASSESSI NG OFFICER HAS NOT REBUTTED THAT THERE WAS NO CHANGE IN COLLECTORS RAT E BETWEEN THIS PERIOD. ITA NO.62 3 (ASR)/2014 ASST. YE AR: 2011-12 4 IT IS ALSO OBSERVED THAT THE PROPERTY IS A DISPUTED PROPERTY AS IS EVIDENT FROM (PB-28-43) WHERE A COPY OF EXECUTION ORDER IS PLACED WHEREBY ONE SH. SUKHBIR SINGH HAS BEEN HELD TO BE OWNER OF SUCH PROPERTY. WHILE APPLYING PROVISIONS OF SECTION 50C HE HAS IGNORED T HE PROVISIONS CONTAINED IN SECTION 50C(2)(A) OF THE ACT. THE ASSE SSING OFFICER SHOULD HAVE APPLIED THE PROVISIONS OF SECTION 50C IN TOTO AS THE ASSESSEE HAD BEEN CLAIMING THAT PROVISIONS OF SECTION 50C WERE N OT APPLICABLE. THE LEARNED CIT(A) HAS ALSO DISMISSED THE APPEAL OF ASS ESSEE HOLDING THAT ASSESSEE SHOULD HAVE RAISED THIS OBJECTION REGARDIN G APPLICABILITY OF PROVISIONS OF SECTION 50C(2)(A) BEFORE ASSESSING OF FICER. WHEREAS IN OUR OPINION, THE LEARNED CIT(A) HOLDING DUAL POWERS OF ADJUDICATURE AND INVESTIGATOR SHOULD HAVE CONSIDERED THE PLEA OF ASS ESSEE REGARDING APPLICABILITY OF PROVISIONS OF SECTION 50C(2)(A) OF THE ACT. THE PROVISIONS OF SECTION 50(C)(2)(A) CLEARLY STATES THAT WHERE AN ASSESSEE CLAIMS BEFORE ANY ASSESSING OFFICER THAT THE VALUE ADOPTED OR ASS ESSED BY THE STAMP VALUATION AUTHORITY EXCEEDED THE FAIR MARKET VALUE OF PROPERTY AS ON THE DATE OF TRANSFER, THE ASSESSING OFFICER MAY REFER T HE VALUATION OF CAPITAL ASSET TO A VALUATION OFFICER. THE ASSESSEE THOUGH N OT EXPRESSLY INVITED THE ASSESSING OFFICERS ATTENTION TO THE PROVISIONS OF SECTION 50C(2)(A) BUT INDIRECTLY SUBMITTED THAT THE PROVISIONS OF SECTION 50C WERE NOT APPLICABLE AND THE ASSESSING OFFICER WAS DUTY BOUND TO ASSIST THE ASSESSEE, THEREFORE, IN THE INTEREST OF JUSTICE, WE SET ASIDE THIS ISSUE TO THE OFFICE OF ASSESSING OFFICER WHO IN ACCORDANCE W ITH THE PROVISIONS OF ITA NO.62 3 (ASR)/2014 ASST. YE AR: 2011-12 5 SECTION 50C(2)(A) WILL DETERMINE THE FAIR MARKET VA LUE OF THE SAID PROPERTY AFTER OBTAINING A REPORT FROM VALUATION OFFICER AND WILL DETERMINE THE CAPITAL GAINS ACCORDINGLY. 10. IN VIEW OF THE ABOVE, THE APPEAL FILED BY TH E ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 13 TH APRIL, 2016. SD/- SD/- (A.D. JAIN) (T.S.KAPOOR) JUDICIAL MEMBER ACCOUNTANT ME MBER DATED:13.04. 2016. /PK/PS. COPY OF THE ORDER FORWARDED TO: (1) THE ASSESSEE: (2) THE (3) THE CIT(A), (4) THE CIT, (5) THE SR DR, I.T.A.T., TRUE COPY BY ORDER (ASSISTANT REGISTRAR) INCOME TAX APPELLATE TRIBUNAL, AMRITSAR BENCH: AMRITSAR.