The ITO, Ward-7(2)(5), Ahmedabad V. Shri Sureshkumar Kundanlal Lalchandani, Ahmedabad

ITA 627/AHD/2017

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 8049 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 3 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-06-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: 2012-2013
• Appeal Filed On: 10-03-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V K SINGH
• Assessee Lawyers: G C PIPARA
• Keywords: Sale consideration of property below Jantri Value; Capital asset; Additional evidence; Fair market value; Valuation report
• Section: 143(3); 50C; 54F

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD D BENCH BEFORE: SHR I RAJPAL YADAV , JUDICIAL MEMBER AND SHRI AMARJIT SINGH, ACCOUNTANT MEMBER THE ITO, WARD - 7(2)(5), AHMEDABAD (APPELLANT) VS SURESHKUMAR KUNDANLAL LALCHANDANI, 33/B, SAROJKUNJ, NEAR SAIBABA MANDIR, SARDARNAGAR, AHMEDABAD - 382475 PAN: AAIPL2842B (RESPONDENT) REVENUE BY : S H RI V. K. SINGH , SR. D . R. ASSESSEE BY: S H RI G.C. PIPARA , A.R. DATE OF HEARING : 25 - 06 - 2 018 DATE OF PRONOUNCEMENT : 28 - 06 - 2 018 / ORDER P ER : AMARJIT SINGH, ACCOUNTAN T MEMBER : - THIS REVENUE S APPEAL FOR A.Y. 2012 - 13 , ARIS ES FROM ORDER OF THE CIT(A) - 7 , AHM EDABAD DATED 14 - 12 - 2016 , IN PROCEEDINGS UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT . 2. THE REVENUE HAS RAISED FOLLOWING GROUNDS OF APPEA L: - 1. THAT UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN DIRECTING A.O. TO ADOPT THE SALE VALUE OF THE LAND AS DETERMINED BY THE DVO TO COMPUTE THE LTCG ACCRUING TO THE ASSESSEE AS OPPOSED TO THE JANTRI V ALUE AS MANDATED U/S. 50C OF THE IT. ACT 1961. 3. THE BRIE F FACT OF THE CASE IS THAT RETURN OF INCOME DECLARING INCOME OF RS . 3 , 47 , 288/ - WAS FILED ON 30 TH MARCH, 2013. SUBSEQUENTLY, THE CASE WAS SELECTED UNDER SCRUTINY BY ISSUING OF NOTICE U/S. 143(2) O F THE A CT O N 12 TH AUGUST, 2013. I T A NO . 627 / A HD/ 20 17 A SSESSMENT YEAR 2012 - 13 I.T.A NO. 627 /AHD/20 17 A.Y. 2012 - 13 PAGE NO ITO VS. SURESHKUMAR KUNDANLAL LALCHANDANI 2 DURING T HE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER HAS NOTICED THAT ASSESSEE HAS SOLD LAND ALONG WITH THREE OTHER PERSONS FOR AMOUNT OF RS. 2 , 15 , 38 , 000/ - . THE ASSESSEE HAS DECLARED HIS SHARE OF SALE CONSIDE RATION OF RS. 53 , 84 , 896/ - IN THE RETURN OF INCOME. ON SCR UTINY, THE ASSESSING OFFICER NOTICED THAT ASSESSEE HAS DECLARED SALE CONSIDERATION LESS THAN THE VALUE ADOPTED BY STAMP VALUATION AUTHORITY. THEREFORE, THE ASSESSING OFFICER HAS APPLIED PROVISION O F SECTION 50C OF THE ACT AND COMPUTED THE SALE CONSIDERATION AS PER SECTION 50C TO THE AMOUNT OF RS. 3 , 20 , 62 , 250/ - AND WORKED OUT LONG TERM CAPI TAL GAIN TO THE AMOUNT OF RS . 2 , 97 , 54 , 745/ - . CONSEQUENTLY, THE ASSESSING OFFICER HAS MADE ADDITION OF RS. 2 , 66 , 77 , 754/ - IN THE TOTAL INCOME OF THE ASSESSEE. 4. AGGRIEVED ASSESSEE FILED APPEAL BEFORE THE LD. CIT(A). DURING THE COURSE OF APPELLATE PROCEEDINGS BEFORE THE LD. CIT(A) , THE ASSESSEE HAS FILED ADDITIONAL EVIDENCES STATING THAT T HE ASSESSING OFFICER H AD R EFERRED THE MATTER FOR VALUATION OF T HE SOLD PROPERTY TO THE DVO ON 27 TH MARCH, 2015 AND THE REPORT OF THE DVO HAS NOT BEEN TAKEN INTO CONSIDERATION BY T H E ASSESSING OFFICER. THE LD. CIT(A) HAS PARTLY ALLOWED THE APPEAL OF THE ASSESSEE BY DIRECTING TH E AS SESSING OFFICER TO R ECOMPUTE THE CAPI T AL GAIN AFTER TAKING INTO CONSIDERATION THE VALUATION REPORT OF THE DVO. THE RELEVANT PART OF THE DECISION OF LD. CIT(A) IS REPRODUCED AS UNDER : - 4.4 I HAVE CONSIDERED THE ASSESSMENT ORDER, FACTS OF THE CASE A ND THE SUBMISSIONS MADE BY THE APPELLANT. A PERUSAL OF THE SAME SHOWS THAT THE AO MADE THE IMPUGNED ADDITION U/S. 50C OF THE ACT GOING BY THE VALUE ADOPTED BY THE STAMP VALUATION AUTHORITY BASED ON JANTRI VALUE. HOWEVER, THOUGH THE MATTER HAD BEEN REFERRED TO TH E DVO FOR VALUATION OF THE SAID PROPERTY, AS ON THE DATE OF SALE, SINCE THE REPORT HAD NOT BEEN RECEIVED BY THE AO TILL 31.3.2015, HE PROCEEDED TO PASS THE ORDER U/S. 143(3) OF THE ACT. THE DVO'S REPORT RECEIVED SUBSEQUENT TO PASSING OF THE ORDER U/S. 143( 3) DETERMINED THE FAIR MARKET VALUE (FMV) OF THE SAID PROPERTY AT RS.3,17,78,300/ - AS AGAINST THE SALE CONSIDERATION OF RS.2,15,38,000/ - SHOWN BY THE APPELLANT. IT IS SEEN FROM THE REMAND REPORT OF THE AO THAT HE HAS ACCEPTED THE FACT THAT THE REPORT OF THE VALUATION OFFICER DATED 01.05.2015 WHICH IN PARA - 10 ESTIMATES THE FMV OF THE SAID PROPERTY AT RS.31,17,78,300/ - HAS NOT BEEN GIVEN EFFECT TO IN THE ORDER. CONSIDERING THE FACTS, THE AO IS DIRECTED TO CONSIDER THE FMV OF THE PROPERTY AS ON THE DATE OF SALE A S ESTABLISHED BY THE DVO AND RECOMPUTE THE CAPITAL GAINS OF THE APPELLANT, ACCORDINGLY. THE AO IS ALSO DIRECTED TO GRANT EXEMPTION U/S. 54F TO THE APPELLANT, AS APPLICABLE. GROUNDS OF APPEAL NOS. 1 TO 3 ARE ACCORDINGLY PARTLY ALLOWED. I.T.A NO. 627 /AHD/20 17 A.Y. 2012 - 13 PAGE NO ITO VS. SURESHKUMAR KUNDANLAL LALCHANDANI 3 5. WE HAVE HEARD TH E RIVAL CONTENTIONS AND PERUSED THE MATERIALS ON RECORD CAREFULLY. THE ASSESSING OFFICER HAS DETERMIN ED LONG TERM CAPITAL GAIN ON TRANSFER OF IMMOVABLE PROPERTY ACCORDING TO PROVISION OF SECTION 50C OF THE ACT. THE ASSESSING OFFICER HAS ADOPTED THE SALE VALUE OF CONSIDERATION ACCRUED TO THE ASSESSEE AS PER THE VALUE OF CAPITAL ASSET ARRIVED ON THE BASIS OF STAMP DUTY PAID TO THE STAMP VALUATION AUTHORITY. HOWEVER, THIS IS UNDISPUTE D FACT THAT THE MATTER OF THE A SSESSEE WAS REFERRED TO THE DVO TO DETERMI NE THE FAIR MARKET VALUE OF THE PROPERTY AS MENTIONED IN THE OFFICE NOTE OF THE ASSESSING OFFICER. THE REPORT OF THE DVO WAS NOT RECEIVED TILL THE COMPLETION OF THE ASSESSMENT O N 31 - 03 - 2015 BY THE ASSESSING OFFICER, THEREFORE, WE DO NOT FIND ANY INFIRMITY IN THE DECISION OF THE LD. CIT(A) DIRECTING THE ASSESSING OFFICER RE - COMPUTE THE CAPITAL GAIN AFTER TAKING INTO CONSIDERATION THE REPORT OF THE DVO DATED 01 - 05 - 2015. ACCORDINGLY, THE APPEAL OF THE REVENUE IS DISMISSED. 6. IN THE RESULT, THE APPEAL O F THE REVENUE IS DISMISSED. ORDER PR ONOUNCED IN THE OPEN C OURT ON 28 - 06 - 201 8 SD/ - SD/ - ( RAJPAL YADAV ) ( AMARJIT SINGH ) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD : DATE D 28 /06 /2018 / COPY OF ORDER FORWARDED TO: - 1. ASSESSEE 2. REVENUE 3. CONCERNED CIT 4. CIT (A) 5. DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER/ , / ,