Shri Dr. Liyakat Ali Kapadiya, Ujjain V. Assistant Commissioner of Income Tax 2 (1), Ujjain

ITA 668/Ind/2017

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 1014 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 5 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-03-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2013-2014
• Appeal Filed On: 17-10-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K C SELVAMANI
• Keywords: Sale consideration of property below Jantri Value; Capital asset; Business income; Salary income; Opportunity of being heard; Additional evidence; Cost of acquisition; Valuation report; Set aside
• Section: 50C; 250

Judgement Text

DR. LIYAKAT ALI KAPADIA ITA 668 OF 2017 1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER ITA NO. 668/IND/2017 A.Y. 2013-14 DR. LIYAKAT ALI KAPADIYA, BARNAGAR PAN ADUPK 5682 K :: APPELLANT VS ACIT-2(1), UJJAIN :: RESPONDENT ASSESSEE BY SHRI MANOJ FADNIS, CA RESPONDENT BY SHRI K.C. SELVAMANI, SR. DR DATE OF HEARING 18.3.2019 DATE OF PRONOUNCEMENT 25.3.2019 O R D E R PER SHRI KUL BHARAT, JM THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE O RDER OF LD. CIT(A)- UJJAIN, DATED 05.7.2017. 2. FIRST GROUND RAISED BY THE ASSESSEE IS THAT THE LD. CIT(A) ERRED IN SUSTAINING THE ADDITION MADE AT RS.11,76,480/- UNDE R THE HEAD CAPITAL GAIN WITHOUT APPRECIATING CORRECT FACTS OF THE CASE. FAC TS, IN BRIEF, ARE THAT THE ASSESSEE IS AN INDIVIDUAL AND DERIVING INCOME FROM SALARY AND PROFESSION, CAPITAL GAIN AND INCOME FROM OTHER SOURCES. THE ASS ESSING OFFICER MADE THE ADDITION OF RS.11,76,480/- ON ACCOUNT OF SHORT TERM CAPITAL GAIN. THE ASSESSEE DR. LIYAKAT ALI KAPADIA ITA 668 OF 2017 2 SOLD A PIECE OF LAND FOR A TOTAL CONSIDERATION OF R S.15 LACS. THE ASSESSEE FURNISHED THE SALE DEED OF THE LAND. AS PER REGISTR Y, THE SALE VALUE OF THE LAND WAS AT RS.15 LACS. THE STAMP VALUATION AUTHORITIES ASSESSED THE VALUE OF LAND AT RS.26,76,480/-. AS PER THE PROVISIONS OF SECTION 50C(3), THE SALE VALUE FOR COMPUTING THE CAPITAL GAIN IS TO BE ADOPTED AS PER THE VALUE ASSESSED BY THE STAMP VALUATION AUTHORITY. THEREFORE, THE ASSESSING OFFICER MADE THE ADDITION OF DIFFERENCE VALUE I.E. RS.11.76,480/-. THE ASSESS EE CHALLENGED THE SAME BEFORE THE LD. CIT(A). THE LD. CIT(A) NOTED THAT TH E ASSESSEE WAS ASKED TO PRODUCE THE REGISTER DEED OF SALE AGREEMENT BUT THE SAME HAS NOT BEEN FILED. THE PLOT WAS SOLD ON POWER OF ATTORNEY, THEREFORE, THERE WAS SUFFICIENT CAUSE FOR NOT PRODUCING THE EVIDENCES WHICH HAD BEEN CALL ED BY THE ASSESSING OFFICER. THEREFORE, ADDL. EVIDENCES PRODUCING DURIN G APPELLATE PROCEEDINGS WERE ADMITTED BY THE LD. CIT(A) AND THE SAME WERE F ORWARDED TO THE ASSESSING OFFICER FOR COMMENTS. THE ASSESSING OFFIC ER SUBMITTED THE REMAND REPORT. CONSIDERING THE FACTS, SUBMISSIONS, REMAND REPORT AND CERTAIN JUDICIAL PRONOUNCEMENTS, THE LD. CIT(A) HELD AS UNDER: 5.1.3 THEREFORE, THE ASSESSING OFFICER IS DUTY BOUND TO A DOPT THE SALE CONSIDERATION AT RS.26,76,480/- AS ADOPTED BY THE STAMP VALUATION AUTHORITIES FOR THE PURPOSE OF CAPI TAL GAIN. SIMILAR VIEW IS ALSO BEEN UPHELD BY HONBLE I TAT, INDORE IN THE CASE OF KRISHNAKANT SHUKLA VS. ACIT ( 2011) 18 ITJ 500 (TRIBUNAL. INDORE). THEREFORE, THE ADD ITION MADE BY THE ASSESSING OFFICER AMOUNTING TO RS.11,76,480/- IS CONFIRMED. THEREFORE, THE APPEAL ON THIS GROUND IS DISMISSED. 3. AT THE OUTSET OF THE HEARING, LD. COUNSEL FOR TH E ASSESSEE CONTENDED THAT THE IDENTICAL ISSUE ON SIMILAR SET OF FACTS AND CIR CUMSTANCES HAS BEEN DEALT DR. LIYAKAT ALI KAPADIA ITA 668 OF 2017 3 WITH BY THIS VERY BENCH AND THIS BENCH HAD REMANDED THE MATTER BACK TO THE FILE OF THE LD. CIT(A) TO ADJUDICATE THE ISSUE AFRE SH AFTER PROCURING THE VALUATION REPORT FROM THE DEPARTMENTAL VALUATION OFFICER. ON THE OTHER HAND, THE LD. SR. DR RELIED ON THE ORDERS OF THE REVENUE AUTHORITIES. HOWEVER, HE DID NOT OBJECT TO THE SUBMISSION OF THE LEARNED COUNSEL FOR THE ASSESSEE IF THE MATTER IS RECONSIDERED BY THE LD. CIT(A). 4. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE O RDERS OF LOWER AUTHORITIES. WE FIND THAT THE IDENTICAL ISSUE ON SI MILAR SET OF FACTS AND CIRCUMSTANCES HAS BEEN DEALT WITH BY US VIDE ORDER DATED 19.9.2018 WHEREIN WE REMANDED THE MATTER BACK TO THE FILE OF THE LD. CIT(A). THE RELEVANT PORTION OF THE ORDER DATED 19.9.2018 (SUPRA) IS REPRODUCED HEREUNDER FOR READY REFERENCE: 8. THE SOLE ISSUE RAISED BY THE ASSESSEE RELATES T O THE SHORT TERM CAPITAL GAIN ADDITION AT RS.78,04,301/- MADE BY THE LD.A.O BY APPLYING PROVISIONS OF SECTION 50C OF THE ACT THEREBY CALCULATING THE SALE CONSIDERATION OF THE INDUSTRIAL LAND SOLD BY THE ASSESSEE ON THE BASIS OF THE VALUE ADOPTED BY THE STAMP VALUATION AUTHORITIES. IT IS NOT DISPUTED THAT SALE DEED HAV E BEEN REGISTERED AND HAVE BEEN SIGNED BY THE ASSESSEE. THE ONLY GRIEVANCE OF THE ASSESSEE IS THAT EVEN WHEN THE OBJECTION WAS RAISED BEFORE BOTH THE LOWER AUTHORIT IES STILL THE ADDITION HAVE BEEN MADE U/S 50C OF THE ACT EVEN WHEN AS PER THE PROVIS IONS OF THE ACT THE ASSESSING OFFICER SHOULD HAVE REFERRED THE MATTER TO THE DEPA RTMENTAL VALUATION OFFICER TO VALUE THE ALLEGED PROPERTY. WE FIND THAT THE LD.CI T(A) CONFIRMED THE ADDITION OBSERVING AS UNDER; 8. GROUND NOS. 4 & 5 :- BY THESE GROUNDS THE APPELLANT HAS CHALLENGED THE ADDITION OF RS. 7804301/ - BEING STC G ADDED BY INVOKING SECTION 50C OF THE INCOME TAX ACT, 1961. T HE DETAILED FACTS OF THE CASE AS PER THE ASSESSMENT ORDER ARE REPRODU CED AT PARA NO.2 ABOVE AND THE DETAILED WRITTEN SUBMISSIONS OF THE A PPELLANT ARE REPRODUCED AT PARA NO.3 ABOVE. 8.1 BRIEFLY STATED THE FACTS ARE THAT FOR THE YEAR UNDE R CONSIDERATION THE AO NOTED THAT THE APPELLANT HAS SOLD IMMOVABLE PROPERTIES ON 24/10/2008 AND 23/01/2009 FOR RS.987000/- & RS.658000/-. AS PER THE SALE DEED THE VALUE ADOPTED BY THE STAMP VALUAT ION AUTHORITY IN DR. LIYAKAT ALI KAPADIA ITA 668 OF 2017 4 RESPECT OF THE ABOVE PROPERTIES WAS RS.5596000 / - AND RS.3776000 / - RESPECTIVELY. APPELLANT HAD NOT SHOWN ANY CAPITAL G AIN ON THE ABOVE TRANSACTION. THE AO THEREFORE ASKED THE APPELLANT T O SHOW CAUSE AS TO WHY THE STCG AS PER PROVISION OF SECTION 50C OF THE INCOME TAX ACT, 1961 OF RS. 7804301/ - NOT BE ASSESSED FOR THE YEAR UNDER CONSIDERATION. APPELLANT CONTENDED THAT PROVISION O F SECTION 50C WERE NOT APPLICABLE AS THE ASSET WAS A BUSINESS ASSET BE ING INDUSTRIAL LAND. APPELLANT ALSO CONTENDED THAT THE TRANSACTION WAS N OT ENTERED IN THE BOOKS OF ACCOUNTS AS REPRESENTATIVE OF THE COMPANY WHO PARTICIPATED IN THE AUCTION OF THE SAID LAND DID NOT INFORM THE COMPANY AND MADE THE PAYMENT OUT OF FUNDS OF SPEED AUTOMOBILE. FURTH ER AFTER PURCHASE IT WAS NOTICED BY HIM THAT THE LAND WAS DISPUTED AN D SO THE SAID LAND WAS SOLD TO TWO DIFFERENT PURCHASERS. AS A RESULT O F THIS BOTH THE PURCHASE AND SALE OF THE LAND WAS NOT COMMUNICATED TO THE APPELLANT COMPANY AND HENCE NECESSARY ACCOUNTING EFFECTS WAS NOT MADE IN THE BOOKS OF ACCOUNTS. APPELLANT ALSO FILED VARIOUS PAP ERS IN SUPPORT OF THE CONTENTION THAT THE LAND IN QUESTION WAS DIVERT ED FOR INDUSTRIAL USE AND WAS THUS USED FOR BUSINESS PURPOSES AND HEN CE WAS NOT COVERED BY PROVISIONS OF SECTION 5 OC OF THE INCOME TAX ACT, 1961. IT WAS ALSO ARGUED THAT AS THE TITLE WAS DISPUTED THE LAND WAS SOLD IMMEDIATELY AT ALMOST COST PRICE. AO HOWEVER, STATE D THAT THE ABOVE ARGUMENTS WERE NOT TENABLE AS THE REGISTRY/DEED WER E UNDER THE' NAME AND SEAL OF THE COMPANY AND PART OF THE LAND S TILL CONTINUED IN THE NAME OF THE COMPANY. AO ALSO NOTED THAT THE APP ELLANT DID NOT CARRY OUT ANY BUSINESS ACTIVITY ON THE SAID LAND, A ND SOLD THE LAND VERY QUICKLY AND THEREFORE IT CANNOT BE SAID THAT I T WAS A BUSINESS ASSET OF THE APPELLANT OR THAT THERE WAS DISTRESS S ALE. 8.2 FROM THE MATERIAL ON RECORD IT IS THUS EVIDENT THAT THE APPELLANT HAS NOT SHOWN ANY CAPITAL GAINS ON THE SALE OF THE ABOVE TWO IMMOVABLE PROPERTIES. THE CONTENTION OF THE APPELLA NT IS THAT BECAUSE OF THE NON COMMUNICATION OF THE PURCHASE AN D SALE TRANSACTION BY THE REPRESENTATIVE ACCOUNTING EFFECT IN THE BOOKS OF ACCOUNTS WERE NOT MADE. THIS CAN HARDLY BE CONSIDER ED AS A VALID REASON FOR NOT SHOWING THE CAPITAL GAINS. IT IS AN ADMITTED POSITION THAT THE REGISTERED DOCUMENTS WERE IN THE NAME OF T HE COMPANY AND ALSO PART OF THE LAND STILL CONTINUED IN THE NAME O F THE COMPANY. THUS AS PER THE LEGAL PROVISIONS THE OWNERSHIP WAS OF THE APPELLANT COMPANY. THE CONTENTION THAT THE LAND WAS BUSINESS ASSET AND HENCE PROVISIONS OF SECTION 5 OC ARE NOT ATTRACTED IS ALSO NOT ESTABLISHED. IT IS AN ADMITTED FACT THAT THE LAND IN QUESTION IS A CAPITAL ASSET AND IS NOT A PART OF THE STOCK IN TRADE OF THE APPELLANT C OMPANY AND HENCE IS COVERED BY THE PROVISIONS OF SECTION SOC. IN THE CASE OF INDERLOK HOTELS(P) LTD. VS. ITO THE ITAT MUMBAI BENCH I 32 S OT 419 (MUMBAI) HAS HELD AS UNDER:- AS PER THE LEGISLATIVE HISTORY, SECTION 5OC WAS IN SERTED IN THE ACT BY THE FINANCE ACT, 2002 WITH EFFECT FROM 1-4-2003 AND IT IS IN THE NATURE OF SPECIAL PROVISION WHICH IS INTRODUCED IN DETERMINING THE FULL VALUE OF THE CONSIDERATION IN CASE OF TRANSFER OF LAND OR BUILDI NG OR BOTH. THE VALUE DETERMINED OR ASSESSED BY ANY AUTHORITY OF THE STATE GOVERNMENT FOR PURPOSE OF PAYMENT OF STAMP DUTY IN RESPECT, OF SUC H REGISTRATION OF DR. LIYAKAT ALI KAPADIA ITA 668 OF 2017 5 CONVEYANCE DEED WOULD BE DEEMED TO BE FULL VALUE OF THE CONSIDERATION RECEIVED OR ACCRUING AS A RESULT OF SUCH TRANSFER. IT BECOMES APPARENT THAT THE SAID SECTION SPECIFICALLY DEALS WITH THE TRANSF ER OF THE 'CAPITAL ASSET', BEING LAND OR BUILDING OR BOTH AND IT PROVIDES FOR REPLACING THE VALUE ADOPTED OR ASSESSED FOR THE PURPOSE OF STAMP DUTY, UNDER SECTION 48 IN PLACE OF VALUE OR SALE CONSIDERATION SHOWN BY THE ASSESSEE. SO FAR AS SECTION 5OC IS CONCERNED THE LANGUAGE OF THE SAID SECTION IS SO CLEAR IN RESPECT OF ITS INTENTION THAT IT IS BROUGHT ON THE STATUTE BOOK BY WAY OF DEEMING PROVISION IN THE NATURE OF THE EXPLANATION TO SECTION 48. MOREOVER, IT IS ABUNDANTLY CLEAR FROM THE EXPLANATION GIVEN IN THE CBDT CIRCULAR NO. 8 OF 2002, DATED 27-8-2002 THAT THE BASIC INTENTION T O INSERT SECTION 5OC WAS FOR THE PURPOSE OF DETERMINING FULL VALUE OF SALE CONSIDERATION FOR THE PURPOSE OF COMPUTATION OF CAP ITAL GAINS UNDER SECTION 48. THERE SHOULD NOT BE ANY CLOUD OF DOUBT THAT SECTION 5OC HAS APPLICATION ONLY TO THE EXTENT OF DETERMINING SALE CONSIDERATION FOR COMPUTATION. OF CAPITAL GAIN UNDER CHAPTER JV-E OF THE ACT AND I T CANNOT BE APPLIED FOR DETERMINING THE INCOME UNDER OTHER HEAD S. THEREFORE, WHEN, ADMITTEDLY, IN THE INSTANT CASE THE SALE OF THE FLA TS WAS TREATED AS THE BUSINESS INCOME AND NOT AS A CAPITAL GAIN, THE PROV ISION OF SECTION 5OC WAS NOT APPLICABLE.' SAME VIEW HAS BEEN TAKEN BY THE HIGH COURT OF MADRA S IN THE CASE OF CIT VS. THIRUVENGADAM INVESTMENT (P.) LTD. 320 ITR 345. IN THE CASE OF ITO VS. UNITED MARINE ACADEMY FOLLOWING OBS ERVATION HAVE BEEN MADE. 'THE MAIN ISSUE FOR CONSIDERATION IN THE INSTANT CASE WAS AS TO WHE THER IN A CASE WHERE CAPITAL GAIN ARISING FROM THE TRANS FER OF DEPRECIABLE ASSET IS COMPUTED AS PER THE SPECIAL PROVISIONS CONTAINED IN SECTION 50, THE PROVISIONS OF SECTION 50C CAN BE APPLIED SO AS TO ADOPT THE VALUE ASSESSED FOR THE PURPOSE OF PAYMENT OF STAMP DUTY TO BE THE FULL VALUE OF THE CONSIDERATION RECEIVED OR ACCRUING AS A RESULT OF SUCH TRANSFER. [PARA 11] THERE ARE TWO DEEMING FICTIONS CREATED IN SECTION 5 O AND SECTION 5OC. THE FIRST DEEMING FICTION MODIFIES THE TERM 'COST OF ACQUISITION' USED IN SECTION 48 FOR THE PURPOSE OF COMPUTING THE CAPITAL GAINS ARIS ING FROM TRANSFER OF DEPRECIABLE ASSETS WHERE AS THE DEEMINQ FICTION CREATED IN SECTION 5OC MODIFIES THE TERM 'FULL VALUE OF THE CONSIDERATION RECEIVED OR ACCRUING AS A RESULT OF TRANSFER OF THE CAPITAL ASSET USED IN SEC TION 48 FOR THE PURPOSE OF COMPUTING THE CAPITAL GAINS ARISING FROM THE TRANSF ER OF CAPITAL ASSET BEING LAND OR BUILDING OR BOTH. THE DEEMING FICTION CREAT ED IN SECTION 5 OC THUS OPERATES IN A SPECIFIC FIELD WHICH IS DIFFERENT FROM THE FIELD WHICH SECTION 50 IS APPLICABLE. IT WAS THUS NOT A CASE WHERE ANY SUPPOS ITION HAD BEEN SOUGHT TO BE IMPOSED ON OTHER SUPPOSITION OF LAW. THERE ARE TWO DIFFERENT FICTIONS CREATED INTO TWO DIFFERENT PROVISIONS AND GOING BY THE LEGISLATIVE INTENTIONS TO CREATE THE SAID FICTIONS, THE SAME OPERATE IN DI FFERENT FIELDS. THE HARMONIOUS INTERPRETATION. OF THE RELEVANT PROVISIO NS MAKES IT CLEAR THAT THERE IS NO EXCLUSION OF APPLICABILITY OF ONE FICTION IN A CASE WHERE OTHER FICTION IS APPLICABLE. AS A MATTER OF FACT, THERE IS NO CONFLICT BETWEEN THESE TWO LEGAL FICTIONS WHICH OPERATE IN DIFFERENT FIELD S AND THEIR APPLICATION IN A GIVEN CASE SIMULTANEOUSLY DOES NOT RESULT IN IMPOSITION OF SUPPOSITION ON OTHER SUPPOSITION OF LAW. THE ASSESSING OFFICER THU S WAS RIGHT IN APPLYING DR. LIYAKAT ALI KAPADIA ITA 668 OF 2017 6 THE PROVISION OF SECTION 5 OC TO THE TRANSFER OF DEPRECIABLE CAPITAL ASSETS COVERED BY SECTION 50 AND IN COMPUTING THE CAPITAL GAIN ARISING FROM THE SAID TRANSFER BY ADOPTING THE STAMP DUTY VALUATION. [PARA 20]' IN THE CASE OF ASSISTANT COMMISSIONER OF INCOME-TAX , CO. CIRCLE IV(3), CHENNAI VS. MIL INDUSTRIES LTD. 142 ITD 428 IT HAS BEEN HELD AS UNDER:- 'WHETHER WHATEVER MAY BE PROBLEMS SUFFERED BY AN ASSESSEE, IN REALITY THOSE REASONS CANNOT BE PERMITTED TO GO BEYOND SCOP E OF SECTION 5 OC _ HELD, YES _ WHETHER, THEREFORE, MISFORTUNES HAPPENED TO A SSESSEE OR DIFFICULTIES FACED BY ASSESSEE OR MATTER OF DISTRESS SALES, ETC., CANNOT BE A GROUND TO MODIFY VALUATION - HELD, YES' CONSIDERING THE ABOVE FACTS AND THE LEGAL POSITION IT IS SEEN THAT THE APPELLANT COMPANY HAS ADMITTED THAT THE LAND IN QUE STION WAS NOT STOCK IN TRADE AND WAS A CAPITAL ASSET HENCE IT WAS WELL COVERED BY THE PROVISIONS OF SECTION 5OC OF THE INCOME TAX ACT, 19 61. THE APPELLANT COMPANY HAS NOT DISPUTED THE VALUE ADOPTED BY THE S TAMP VALUATION AUTHORITY AND HAS ALSO NOT OBJECTED TO THE ADOPTION OF THE SAME BY THE AO. IN VIEW OF THE ABOVE THE COMPUTATION OF STCG AT RS.7804301/- MADE BY THE AO IS UPHELD IN APPEAL. THESE GROUNDS O F THE APPELLANT ARE THEREFORE DISMISSED. 9. WE FURTHER FIND THAT THE ASSESSEE DURING THE COU RSE OF ASSESSMENT PROCEEDINGS FILED THE SUBMISSIONS OBJECTING THE LEV Y OF CAPITAL GAIN PLEADING THAT THE LAND WAS AN INDUSTRIAL LAND AND W AS DISPUTED AND THE REGISTRY DOCUMENTS WERE SIGNED UNDER THE NAME AND S EAL OF THE COMPANY TO BUY PEACE JUST TO GET RID OF THE DISPUTED PROPER TY NO MATTER THE CONSIDERATION IS LESS THAN THE FAIR MARKET PRICE. 10. THEREAFTER WHEN THE MATTER CAME UP BEFORE THE LD.CIT(A), ASSESSEE MADE FOLLOWING SUBMISSION:- GROUND NO.4&5: LD. AO HAS ASSESSED SHORT TERM CAP ITAL GAIN U/S 50C AMOUNTING TO RS.7804301/- WITHOUT APPRECIATING THAT THE PROPERTY SOLD BY THE ASSESSEE WAS THE BUSINESS ASSET IN THE BOOKS OF ASSESSEE, IN FACT, THE PROPERTY APPEARED IN THE BALANCE SHEET OF THE ASSES SEE SINCE THE DAY OF ITS ACQUISITION IN A AUCTION BUT ASSESSEE COULD NOT GET ITS POSSESSION WITH CLEAR TITLE UP TO THE DATE IT WAS DISPOSE OFF. THE ASSESSEE HAS MADE A SUCCESSFUL BID IN A AUCTION CONDUCTED BY THE COMMER CIAL DEPARTMENT WHICH WAS ATTACHED AGAINST COMMERCIAL TAX RECOVERY AGAINST THE DEFAULTER OWNER OF THE PROPERTY. THE ASSESSEE GOT THE TITLE TRANSFERRED BY VIRTUE OF ABOVE AUCTION. BUT TO HIS SURPRISE, HE C OULD NOT GET THE POSSESSION AS THE SAID PROPERTY WAS UNDER ENCROACHM ENT AND DISPUTE WITH OTHER PARTIES. THE ASSESSEE UNSUCCESSFULLY TRIED T O TAKE POSSESSION OF THE PROPERTY BY RESORTING TO LEGAL ACTION AGAINST THE E NCROACHER WHO WAS HOLDING ADVERSE POSSESSION. WHEN LEGAL BATTLE DID NOT GIVE FRUITFUL RESULTS, THE ASSESSEE HAD TO MADE DISTRESS SALE OF THE PROPERTY. YOUR HONOUR MAY APPRECIATE THAT NO PROPERTY WILL FETCH M ARKET VALUE IT CARRIES DISPUTE WITH IT. IN SUCH CIRCUMSTANCES, THE LD. AS SESSING OFFICER ERRED IN ASSESSING STCG BY INVOKING SECTION. 50C. 11. THE ABOVE SUBMISSIONS MADE BY THE ASSESSEE BEF ORE THE LOWER DR. LIYAKAT ALI KAPADIA ITA 668 OF 2017 7 AUTHORITIES REVEALS THAT THE OBJECTION HAS BEEN RAI SED BY THE ASSESSEE CHALLENGING THE VALUE ADOPTED BY THE ASSESSING OFFI CER TO COMPUTE THE SHORT TERM CAPITAL GAIN. IT SEEMS THAT THE LD. ASS ESSING OFFICER HAS DIRECTLY RESORTED TO IMPOSE THE PROVISIONS OF SECTI ON 50C WITHOUT EVEN CALLING FOR A DEPARTMENTAL VALUATION OFFICERS REPO RT WHEN THE VALUE SO ADOPTED BY THE STAMP VALUATION AUTHORITIES HAS BEEN CHALLENGED BY THE ASSESSEE. EVEN WHEN THE MATTER CAME UP BEFORE LD.C IT(A), HE EVEN WHEN HAVING CO-TERMINUS POWER AS THAT OF THE ASSESSING O FFICER DID NOT REFER THE MATTER FOR VALUATION TO DVO. 12. WE FIND THAT SIMILAR SET OF FACTS CAME BEFORE U S IN THE CASE OF SADHANA SHARMA VS. ITO-2(4), INDORE, I.T.A.NO.396/IND/97(SU PRA) WHEREIN WE HAVE DIRECTED THE LD.CIT(A) FOR EXAMINING THE ADDIT IONAL EVIDENCES AND ALSO DIRECTED HIM TO MAKE DUE REFERENCE TO THE DVO FOR VALUING THE IMPUGNED LAND, OBSERVING AS FOLLOWS; 8. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED REC ORDS PLACED BEFORE US. THE ASSESSEE, APART FROM CHALLENGING THE ADDITION OF SH ORT TERM CAPITAL GAIN CONFIRMED BY LD. CIT(A) HAS ALSO CHALLENGED THE ACT ION OF LD.CIT(A) OF REJECTING THE ASSESSEES APPLICATION FOR ADMISSION OF ADDITIO NAL EVIDENCE. 9. WE OBSERVE THAT IN THE INSTANT APPEAL THE ISSUE RELATES TO THE ADOPTION OF MARKET VALUATION AS PER STAMP DUTY VALUATION AUTHOR ITY BY THE ASSESSING OFFICER IN VIEW OF THE PROVISIONS OF SECTION 50C OF THE ACT WHEREAS THE SALE CONSIDERATION SHOWN IN REGISTERED SALE DEED WAS LESS THAN THE VAL UE ADOPTED BY THE ASSESSING OFFICER. DUE TO THIS REASON THE ADDITION OF SHORT TERM CAPITAL GAIN OF RS.25,32,495/- HAS BEEN CONFIRMED BY BOTH THE LOWER AUTHORITIES. WE FIND THAT THE ASSESSEE DID NOT RAISE ANY OBJECTION AGAINST THE ADOPTION OF MARKET VALUE BY DEPARTMENTAL VALUATION OFFICER BEFORE THE ASSESSIN G OFFICER TO MAKE REFERENCES TO DEPARTMENTAL VALUATION OFFICER (IN SHORT DVO) N OR HE FILED ANY VALUATION REPORT FROM ANY OTHER REGISTERED VALUER. HOWEVER WH EN THE ASSESSEE CAME UP IN APPEAL BEFORE LD.CIT(A) THE APPLICATION FOR ADMISSI ON OF ADDITIONAL EVIDENCE WAS FILED IN ORDER TO PROVE THE POOR LOCATION OF THE IM PUGNED LAND BEING NEAR TO NALLAH WHICH AFFECTS THE MARKET VALUE OF THE LAND . THE ASSESSEE HAS ALSO SUBMITTED SALE DEEDS OF THE LANDS IN THE IMMEDIATE VICINITY OF THE IMPUGNED LAND WHERE THE MARKET PRICE ADOPTED BY THE STAMP VALUE A UTHORITY ARE ALMOST AT PAR WITH THE SALE CONSIDERATION SHOWN BY THE ASSESSEE. THESE ADDITIONAL EVIDENCES WERE REJECTED BY LD.CIT(A) ONLY FOR THE REASONS THA T THE ASSESSEE COULD NOT GIVE ANY POSSIBLE REASON FOR BEING FAILED TO PROVIDE THE SAME DURING THE ASSESSMENT PROCEEDINGS. FROM THE PERUSAL OF THE JUDGMENT REFE RRED AND RELIED BY THE LD. COUNSEL FOR THE ASSESSEE WE OBSERVE THAT THE HONBL E HIGH COURT OF BOMBAY IN THE CASE OF RALLIES INDIA LTD V/S CIT (APPEALS) ADJ UDICATING THE ISSUE AS TO WHERE THE ASSESSING OFFICER FAILS TO MAKE ENQUIRY U/S 55A BY PASSING THE ASSESSMENT ORDER, CAN THE COMMISSIONER OF APPEALS D URING THE APPELLATE PROCEEDINGS BEFORE HIM CAN MAKE SUCH AN ENQUIRY BY MAKING REFERENCE TO DEPARTMENTAL VALUATION OFFICER EITHER HIMSELF OR DI RECT THE ASSESSING OFFICER TO DO SO IN TERMS OF SECTION 250(4) OF THE ACT AND H ONBLE COURT HOLDING IN FAVOUR OF THE ASSESSEE TAKING SUPPORT FROM THE VIEW TAKEN BY HONBLE APEX COURT IN THE CASE OF CIT VS KANPUR COALS SYNDICATE (1964) 53 IT R 225 WHEREIN THE HONBLE APEX COURT HELD THAT IT IS UNDISPUTED THAT THE PO WER OF CIT (APPEALS) IS CO TERMINUS WITH THAT OF ASSESSMENT OFFICER, IN FACT T HE CIT (APPEALS) CAN DO WHAT THE ASSESSING OFFICER CAN DO. DR. LIYAKAT ALI KAPADIA ITA 668 OF 2017 8 10. SIMILAR VIEW WAS ALSO TAKEN BY THE HON'BLE HIGH OF GUJARAT IN THE CASE OF CIT VS AHMEDABAD PRINCIPALCOMPANIES (1994) 76 TAXMANN.C OM 109(GUJARAT) HOLDING THAT IT WAS OPEN TO THE ATO CONSIDER ON ME RITS CONTENTIONS RAISED IN AN APPEAL, ON AN ASPECT WHICH WAS NEVER BEFORE ITO AND WITH WHICH THE ASSESSEE NEVER AGREED. 11. COMING TO THE FACTS OF THE INSTANT APPEAL AND E XAMINING THEM IN THE LIGHT OF ABOVE JUDGMENTS WE FIND THAT THE ASSESSEE FAILED TO RAISE OBJECTION BEFORE THE ASSESSING AUTHORITY ABOUT THE ADOPTION OF STAMP AUT HORITY VALUATION BUT SUBSEQUENTLY RAISED THE ISSUE BEFORE LD. CIT(APPEAL S). SPECIFIC GROUND WAS ALSO RAISED FOR ADMITTING OF ADDITIONAL EVIDENCE AND OBJ ECTED THE MARKET VALUE ADOPTED BY THE ASSESSING AUTHORITY BUT LD. CIT(A) C ASUALLY BRUSHED ASIDE THIS APPLICATION. WE THEREFORE IN THE GIVEN CIRCUMSTANC ES OF THE CASE AND IN THE INTEREST OF JUSTICE AND FAIR PLAY ARE OF THE CONSID ERED OPINION THAT THE LD.CIT(A) OUGHT TO HAVE ADMITTED THE ADDITIONAL EVIDENCE AS I T IS WELL WITHIN HIS POWERS PROVIDED IN SECTION 250 OF THE ACT AND SHOULD HAVE MADE DUE REFERENCES TO THE DEPARTMENTAL VALUATION OFFICER FOR VALUING THE IMPU GNED LAND. WE THEREFORE ACCEPT THE ADDITIONAL EVIDENCE AND SET ASIDE ALL TH E ISSUES RAISED IN THIS APPEAL TO THE FILE OF LD.CIT(A) TO EXAMINE THE ADDITIONAL EVI DENCE FILED BY THE ASSESSEE AND DECIDE ACCORDINGLY AS PER PROVISIONS OF LAW. NEEDL ESS TO MENTION THAT REASONABLE OPPORTUNITY SHOULD BE PROVIDED TO THE ASSESSEE. 12. IN THE RESULT THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES 13. WE THEREFORE FOLLOWING OUR OWN JUDGMENT IN TH E CASE OF SADHANA SHARMA VS. ITO-2(4), INDORE, I.T.A.NO.396/IND/97 (SUPRA) ARE OF THE CONSIDERED VIEW THAT THE INSTANT APPEAL IS ALSO HAVING SIMILAR SET OF FACTS AND THEREFORE DIRECT THE LD.CIT(A) TO ADJUDICATE THIS ISSUE AFRESH AFTER PRO CURING THE VALUATION REPORT FROM THE DEPARTMENTAL VALUATION OFFICER ABOUT THE F AIR MARKET VALUE OF THE IMPUGNED INDUSTRIAL LAND SITUATED AT BHAGIRATHPURA INDUSTRIAL AREA, INDORE AS ON THE DATE OF SALE AND ALSO AFTER APPRECIATING THE DO CUMENTS PLACED AT PAGE 34 TO 41 OF THE PAPER BOOK WHICH ARE RELATED TO THE UNAUT HORIZED POSSESSION OF THE INDUSTRIAL LAND OWNED BY THE ASSESSEE AND THE LITIG ATION CARRIED BETWEEN THE ASSESSEE AND OTHER PARTIES. NEEDLESS TO SAY THAT A PROPER OPPORTUNITY OF BEING HEARD SHOULD BE GIVEN TO THE ASSESSEE TO FURNISH NE CESSARY DOCUMENTS AND DETAILS OF THE PROPERTY TO THE DEPARTMENTAL VALUATION OFFIC ER AS WELL AS LD.CIT(A). IN VIEW OF THE ABOVE FINDING, THE PRESENT MATTER HA VING THE IDENTICAL ISSUE IS ALSO DIRECTED TO BE REMANDED TO THE FILE OF THE LD. CIT(A). THE LD. CIT(A) WOULD GO THROUGH THE RELEVANT ASSESSEES PAPER BOOK/SUBMI SSIONS/CASE-LAWS AND THEN DECIDE THE MATTER AFRESH AFTER PROCURING THE V ALUATION REPORT FROM THE DEPARTMENTAL VALUATION OFFICER IN TERMS AS INDICATE D HEREINABOVE AFTER AFFORDING DUE OPPORTUNITY OF BEING HEARD TO THE ASS ESSEE AS PER LAW AND THE ASSESSEE IS ALSO DIRECTED TO COOPERATE/APPEAR BEFOR E LD. CIT(A) IN THIS REGARD. DR. LIYAKAT ALI KAPADIA ITA 668 OF 2017 9 THEREFORE, THIS GROUND OF THE APPEAL OF THE ASSESSE E IS ALLOWED FOR STATISTICAL PURPOSES ONLY. 5. SECOND GROUND RAISED BY THE ASSESSEE IS THAT THE LD. CIT(A) ERRED IN REJECTING THE EXPLANATION OFFERED AND FACTUAL POSIT ION FOR ADDITIONS MADE AT RS.15,550/- UNDER THE HEAD BUSINESS OR PROFESSION . DURING THE COURSE OF HEARING, THE LEARNED COUNSEL FOR THE ASSESSEE DID N OT ARGUE THIS GROUND. THEREFORE, THIS GROUND BEING TREATED AS NOT PRESSED IS DISMISSED. 6. IN RESULT, APPEAL FILED BY THE ASSESSEE IS PARTL Y ALLOWED FOR STATISTICAL PURPOSES ONLY. ORDER WAS PRONOUNCED IN THE OPEN COURT ON 25.3.2019 . SD/- ( MANISH BORAD) ACCOUNTANT MEMBER SD/- (KUL BHARAT) JUDICIAL MEMBER DATED : 25.3.2019 ! VYAS ! COPY TO: APPELLANT/RESPONDENT/PR.CIT(A)/PR.CIT/DR, INDORE