SMT. HANJA BAI W/O LATE SHRI SUKHRAM DHAKAD, Indore V. THE ITO 1(3), Indore

ITA 670/IND/2014

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 5912 (ITAT-INDORE)
• Duration Of Justice: 2 year(s) 2 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-01-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2009-2010
• Appeal Filed On: 29-10-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MOHD JAVED
• Assessee Lawyers: S S SOLANKI
• Keywords: Sale consideration of property below Jantri Value; Principle of natural justice
• Section: 50C; 148; 144

Judgement Text

ITA NO.670 OF 2014 SMT. HANJA BAI 1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI D.T. GARASIA, JUDICIAL MEMBER AND SHRI O.P. MEENA, ACCOUNTANT MEMBER ITA NO.670/IND/2014 A.Y. 2009-10 SMT. HANJA BAI W/O LATE SUKHRAM DHAKAD, INDORE PAN BRQPB 9212 F :: APPELLANT VS ITO-1(3), INDORE :: RESPONDENT ASSESSEE BY SHRI S.S. SOLANKI, CA RESPONDENT BY SHRI MOHD. JAVED DATE OF HEARING 2 0 .1 2 .201 6 DATE OF PRONOUNCEMENT 18 .1.2017 O R D E R PER SHRI D.T. GARASIA, JM THE ABOVE APPEAL FILED BY THE ASSESSEE IS AGAINST THE ORDER OF LEARNED CIT(A)-I, INDORE, DATED 01.7.2014 ON THE FOLLOWING GROUNDS OF APPEAL: 1.1 THAT THE ISSUANCE OF NOTICE U/S 148 BY THE ASS ESSING OFFICER AND PASSING THE ORDER U/S 144 FOR THE ASSESSMENT YE AR 2009-10 BEING ILLEGAL AND WRONG PARTICULARLY WHEN IN ASSESSMENT Y EAR 2009-10, NO AGRICULTURAL LAND WAS SOLD. THE ORDER SO PASSED U/S 144, THEREFORE REQUIRES TO BE QUASHED. ITA NO.670 OF 2014 SMT. HANJA BAI 2 1.2 THAT THE LD. CIT(A) ERRED IN MAINTAINING ADDITI ON OF RS.50,00,170/- MADE UNDER THE HEAD LTCG BY HOLDING THAT TRANSFER IS COMPLETE ONLY WHEN THE SALE DEED IS REGISTERED. THA T THE SALE OF THE PROPERTY WAS EXECUTED ON 20.3.2008 I.E. IN ASSESSME NT YEAR 2008-09. THE ADDITION MADE BY THE ASSESSING OFFICER AND CONF IRMED BY THE LD. CIT(A) IN ASSESSMENT YEAR 2009-10 IS ILLEGAL AND WR ONG. THE SAME, THEREFORE, REQUIRES TO BE DELETED. WITHOUT PREJUDICE TO THE ABOVE 2. THAT THE ASSESSEE HAS PURCHASED LAND WHICH QUALI FIES FOR EXEMPTION U/S 54B. THE SAME REQUIRES TO BE ALLOWED IF ANY ADDITION IS TO BE MADE. 2. THE ASSESSEE HAS ALSO TAKEN AN ADDITIONAL GROUND OF APPEAL WHICH READS AS UNDER: THAT THE ASSESSING OFFICER ERRED IN TAKING THE VAL UE OF PROPERTY AT RS.77,31,000/- AND THE LD. CIT(A) ERRED IN CONFIRMI NG THE SAME, BY APPLYING THE PROVISIONS OF SECTION 50C. THE ASSESSI NG OFFICER/LD. CIT(A) SHOULD HAVE REFERRED THIS MATTER TO THE DVO FOR PROPER ADJUDICATION OF THE MATTER. THE ADDITION SO MADE/CO NFIRMED WITHOUT REFERRING THE MATTER TO THE DVO IS DENIAL OF PRINCI PLES OF NATURAL JUSTICE. THE ORDER SO PASSED BEING ILLEGAL AND WRON G. THE SAME REQUIRE TO BE QUASHED. 3. THE ADDITIONAL GROUND RAISED BY THE ASSESSEE WAS ADMITTED FOR THE HEARING AS THIS GOES TO THE ROOT OF THE MATTER AND IS ESSEN TIAL IN COMPUTATION OF CORRECT ITA NO.670 OF 2014 SMT. HANJA BAI 3 INCOME. FACTS, IN BRIEF, ARE THAT THE ASSESSEE SOL D AGRICULTURAL LAND TO SMT. HARJINDAR KAUR BHALLA AT RS.33,61,000/- WITH THE HE LP OF SHRI JAGJIT SINGH SANDHU AND TOOK FULL CREDIT OF THE AMOUNT OF SALE PRICE. B UT THE STAMP FEE OFFICER HAS DETERMINED FARE MARKET VALUE OF AGRICULTURAL LAND A T RS.77,31,000/-. THEREFORE, THE ASSESSING OFFICER DETERMINED THE CAPITAL GAIN A S UNDER: SALES CONSIDERATION AS DETERMINED BY REGISTRAR RS. 77,31,000/- INDEX COST OF THE PROPERTY (-) RS.27 ,30,830/- LONG TERM CAPITAL GAIN TO TAX RS.50,00,170/- THE ASSESSING OFFICER ISSUED LETTER DATED 25.3.2012 TO THE ASSESSEE ASKING THE ASSESSEE TO ATTEND THE OFFICE ON 28.3.2013 EITHER I N PERSON OR BY AUTHORIZED REPRESENTATIVE TO PLEASE SHOW CAUSE WHY VALUE OF PR OPERTY AS ON 01.4.1981 AND CAPITAL GAIN DETERMINED AS ABOVE SHOULD NOT BE TAKE N FOR COMPUTATION OF CAPITAL GAIN. HOWEVER, THE ASSESSEE DID NOT ATTEND THE OFFI CE AND ULTIMATELY, THE ASSESSING OFFICER FRAMED ASSESSMENT U/S 144 OF THE I.T. ACT AND MADE ADDITION OF RS.50,00,170/- AS ABOVE. AGAINST THE ACTION THE ASS ESSING OFFICER, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE LD. CIT(A) AND LD. C IT(A) CONFIRMED THE ACTION OF THE ASSESSING OFFICER. BEING AGGRIEVED, THE ASSESSE E IS BEFORE THIS TRIBUNAL. ITA NO.670 OF 2014 SMT. HANJA BAI 4 3. BEFORE US, THE LD. COUNSEL FOR THE ASSESSEE, REI TERATED THE SUBMISSION MADE BEFORE THE REVENUE AUTHORITIES AND STATED THAT THE LD. FIRST APPELLATE AUTHORITY HAS WRONGLY UPHELD THE ADDITION IN DISPUTE WITHOUT CONSIDERING THE REAL FACTS AND RECORD AVAILABLE WITH THE AUTHORITIES BELOW. HE FUR THER STATED THAT THE REVENUE AUTHORITIES WITHOUT REFERRING THE MATTER TO THE VAL UATION OFFICER APPLIED SEC. 50C WHICH IS NOT JUSTIFIED. HE FURTHER STATED THAT THE PROPERTY IN QUESTION HAS BEEN SOLD AT THE PREVAILING MARKET RATES. HE POINTED OUT THAT THE VALUED ADOPTED BY THE STAMP DUTY AUTHORITY IS MUCH MORE THAN THE FAIR MAR KET VALUE OF THE PROPERTY. HE STATED THAT IN THESE CIRCUMSTANCES, THE ASSESSING O FFICER SHOULD HAVE REFERRED THE MATTER TO THE VALUATION OFFICER IN VIEW OF SECTION 50C OF THE INCOME-TAX ACT, 1961, WHICH HAS NOT BEEN DONE BY THE AO AS WELL AS HAS ALSO NOT BEEN APPRECIATED BY THE LD. CIT(A) IN THE IMPUGNED ORDER . 4. THE LD. DR, ON THE OTHER HAND, RELIED UPON THE O RDERS OF THE AUTHORITIES BELOW. 5. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL AVAILABLE ON RECORDS ESPECIALLY THE PROVISIONS OF SECTION 50C OF THE I.T. ACT, 1961. WE ARE NOT COMMENTING UPON THE MERITS OF THE CASE. WE HAVE ALS O GONE THROUGH THE DECISION IN THE CASE OF MANJULA SINGHAL VS. ITO REPORTED IN 141 TTJ 511 (ITAT JODHPUR), ITA NO.670 OF 2014 SMT. HANJA BAI 5 WHEREIN, THE IDENTICAL ISSUE WAS REMANDED TO THE AS SESSING OFFICER TO REFER THE MATTER TO THE D.V.O. KEEPING IN VIEW THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE AS WELL AS RELEVANT PROVISIONS OF SECTION 50C OF THE ACT, WE ARE OF THE CONSIDERED OPINION THAT AO SHOULD HAVE REFERRED THE MATTER TO THE D.V.O. THEREFORE, IN THE INTEREST OF JUSTICE, WE REMIT THE MATTER BACK TO THE FILE OF THE A.O. WITH THE DIRECTION TO REFER THE MATTER TO THE D.V.O. FOR PROPER VALUATION OF THE PROPERTY AND THEREAFTER DECIDE THE GROUNDS OF A PPEALS IN DISPUTE DE NOVO IN ACCORDANCE WITH LAW AFTER GIVING ADEQUATE OPPORTUNI TY TO THE ASSESSEE FOR SUBSTANTIATING THE CLAIM. THE ASSESSEE IS AT LIBERT Y TO FILE FURTHER EVIDENCE, IF ANY, IN SUPPORT OF THE CLAIM. ACCORDINGLY, ALL THE GROUN DS OF THE APPEAL ARE ALLOWED FOR STATISTICAL PURPOSES. 6. IN RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES ONLY. ORDER WAS PRONOUNCED IN THE OPEN COURT ON 18.1.2017 . SD/- SD/- (O.P. MEENA) (D.T. GARASIA) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 18.1.2017 !VYS!