LATE SMT. SEEMA MUKHERJEE, Jaipur V. ITO, Jaipur

ITA 692/JPR/2016

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 6104 (ITAT-JAIPUR)
• Duration Of Justice: 1 year(s) 11 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-06-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2005-2006
• Appeal Filed On: 27-06-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHANMUGA PRIYA
• Assessee Lawyers: PRAVIN SARASWAT
• Keywords: Sale consideration of property below Jantri Value; Cost of acquisition; Fair market value; Corroborative evidences
• Section: 50C; 148

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR JH FOT; IKY JKO] U;KF;D LNL; ,OA JH FOE FLAG ;KNO] YS[KK LNL; DS LE{K BEFORE: SHRI VIJAY PAL RAO, JM & SHRI VIKRAM SINGH YADAV, AM VK;DJ VIHY LA- @ ITA NO. 692/JP/2016 FU/KZKJ.K O'K Z @ ASSESSMENT YEAR : 2005-06 LATE SMT. SEEMA MUKHERJEE L/H SHRI ALOK MUKHERJEE & AROOP MUKHERJEE HATHI BABU KA BAGH, STATION ROAD, JAIPUR. CUKE VS. THE ITO, WARD 3(2), JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: ACTPM 0161 H VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ L S@ ASSESSEE BY : SHRI PRAVIN SARASWAT (C.A.) JKTLO DH VKSJ LS @ REVENUE BY : MS SHANMUGA PRIYA (JCIT) LQUOKBZ DH RKJH[ K@ DATE OF HEARING : 05/06/2018 MN?KKS'K.KK DH RKJH[ K@ DATE OF PRONOUNCEMENT: 08/06/2018 VKNS'K@ ORDER PER: VIJAY PAL RAO, J.M. THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER DATED 12.04.2013 OF LD. CIT (A), JAIPUR FOR A.Y. 2005-06. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS:- 1. THAT LEARNED CIT(A) HAS NOT CONSIDERED THE FACTS ON RECORD THAT NOTICE ISSUED U/S 148 WAS NOT SERVED TO ALL LEGAL H EIRS OF DECEASED ASSESSEE. HENCE ASSESSMENT MADE IS NOT JUS TIFIED. ITA NO. 692/JP/2016 LATE SMT. SEEMA MUKHERJEE VS. ITO 2 2. THAT LEARNED C.I.T. (A) HAS ERRED IN CONFIRMATION T HE ADDITION OF RS.8,07,829/- OF LONG TERM CAPITAL GAIN AS THE FACT S ON RECORD HAS NOT BEEN PROPERLY CONSIDERED AND SIMPLY GIVEN CUT & PASTE, THE FACTS OF OTHER CASE, WHILE FACTS IN CASE ARE SEPARA TE. 3 THE LEARNED C.I.T. (A) HAS ERRED IN CONFIRMING TH E ADDITION OF RS.2,87,252/- ON ACCOUNT OF LONG TERM CAPITAL GAIN (1 /3 RD OF THE PROPERTY, 5, HATHI BABU KA BAGH, STATION ROAD, JAIP UR) ON BASIS OF WRONG FINDINGS OF A.O., WHICH ARE SUB-JUDICE, WH ILE ASSESSEE HAS GIVEN COMPLETE DETAILS OF LAND & CONSTRUCTION O N BASIS OF SALE DEED FOR ASCERTAINING THE PROPER VALUATION, BUT SAM E HAS BEEN IGNORED BY LEARNED C.I.T. (A). THUS ADDITION MADE I S NOT JUSTIFIED. 4 THE LEARNED C.I.T. (A) & A.O. HAS WRONGLY CONSIDE RED 50C VALUE OF PLOT NO. 14, HATHI BABU KA BAGH, STATION ROAD, J AIPUR OF RS.5,68,452/- AND APPLIED COST OF ACQUISITION AS ON 1.4.1981 AND MADE ADDITION OF LONG TERM CAPITAL GAIN OF RS.5,20, 577/-, WHICH IS NOT JUSTIFIED. 5 THE LEARNED C.I.T. (A) & A.O. HAS NOT CONSIDERED THE FACT ON RECORD, THAT PROPERTY PLOT OF LAND NO. 14 WAS ON RE NT TO SHRI RAGHUVEER SINGH ON 01.09.1972, THEREAFTER TENANT HI M-SELF MADE CONSTRUCTION ON IT. SO AFTER CONSIDERING LAND VALUE (44.72 SQ. MTR. @ 150= 6,708/-) & CONSTRUCTION (1096.85 SQ. FT. @ 130=1,40,000) AS ON 1.4.1981 OF RS.1,46,708/- AFTER INDEXATION CAPITAL GAIN WILL BE NIL, WHICH HAS NOT BEEN CONSID ERED BY LEARNED C.I.T. (A) AND NOT GIVEN ANY FINDING ON ASSESSEE'S SUBMISSION. 6. THAT ASSESSE CAN ADD, ALTER OR AMEND GROUNDS OF APPEAL BEFORE HEARING DURING HEARING. 2. THE ASSESSE HAS ALSO FILED AN ADDITIONAL GROUND NO. 7 HOWEVER, AT THE TIME OF HEARING THE LD. AR OF THE ASSESSEE HAS SUBMITTED THAT THE ASSESSEE DOES NOT WANT TO PRESS ADDITIONAL GROUND A ND THE SAME MAY ITA NO. 692/JP/2016 LATE SMT. SEEMA MUKHERJEE VS. ITO 3 BE DISMISSED AS WITHDRAW. SINCE, THE ADDITIONAL GRO UND WAS NOT EVEN ADMITTED BY THE BENCH, THEREFORE IN VIEW OF THE STA TEMENT OF THE LD. AR OF THE ASSESSEE, WE ALLOW TO THE ASSESSEE TO WITHDR AW THE ADDITIONAL GROUND AND CONSEQUENTIAL THE SAME IS DISMISSED AS W ITHDRAW. 3. THE ASSESSEE LATE SMT. SEEMA MUKHERJEE DURING HE R LIFE TIME SOLD TWO PROPERTIES DETAILS OF WHICH ARE AS UNDER:- PLOT NO. BUYER DATE OF REGISTRATION ACTUAL VALUE STAMP VALUE 5, HATHI BABU KA BAGH, JAIPUR CHAMPA LAL JAIN 25/02/2005 250000/ - (1/3 SHARE) 317190/ - (1/3 SHARE) 14, HATHI BABU KA BAGH, JAIPUR RAGHUVEER SINGH 01/03/ 2005 150000/ - 568452/ - LATE SMT. SEEMA MUKHERJEE DID NOT FILE ANY RETURN O F INCOME IN THE YEAR UNDER CONSIDERATION AND DIED INTESTATE ON 10.1 1.2008. THE AO REOPENED THE ASSESSMENT BY ISSUING NOTICE U/S 148 O F THE IT ACT ON 29.03.2012 TO SHRI ALOK MUKHERJEE AND SHRI AROOP MU KHERJEE LEGAL HEIR OF LATE SMT. SEEMA MUKHERJEE. THE ASSESSEE RAISED T HE OBJECTION AGAINST THE NOTICE ISSUED U/S 148 OF THE ACT WHICH WAS DISPOSED OFF BY THE AO VIDE SEPARATE ORDER DATED 08.03.2013. ACCORD INGLY, THE AO HAS COMPLETED THE RE-ASSESSMENT AND ASSESSED THE LONG T ERM CAPITAL GAIN IN ITA NO. 692/JP/2016 LATE SMT. SEEMA MUKHERJEE VS. ITO 4 THE HANDS OF THE ASSESSEE THROUGH LEGAL HEIRS ON AC COUNT OF SALE OF THE PROPERTIES. THE DISPUTE IS REGARDING FULL VALUE CON SIDERATION AS ADOPTED BY THE AO AS PER THE PROVISIONS OF SECTION 50C OF T HE ACT AS WELL AS COST OF ACQUISITION BEING FAIR MARKET VALUE AS ON 01.04. 1981 IN RESPECT OF TWO PROPERTIES WHICH FIRST PLOT 5, HATHI BABU KA BA GH, STATION ROAD, JAIPUR 1/3 SHARE AND SECOND PLOT 14, HATHI BABU KA BAGH, STATION ROAD, JAIPUR. 4. WE HAVE HEARD THE LD. AR AS WELL AS THE LD. DR A ND CONSIDERED THE RELEVANT MATERIALS ON RECORD. AS REGARDS THE VA LUATION OF THE PROPERTIES BEARING PLOT NO. 5, HATHI BABU KA BAGH, STATION ROAD, JAIPUR THE AO HAS ADOPTED THE FULL VALUE CONSIDERATION U/S 50C OF THE ACT. HOWEVER, THE ASSESSEE HAS CONTENDED THAT THE SAID P ROPERTY HAS BEEN OCCUPIED BY AN OLD TENANCY SHRI V.S. MATHUR AND IT WAS VERY DIFFICULT TO GET THE PROPERTY VACATED FROM THE TENANT. THUS, THE ASSESSEE CONTENDED THAT THE PROPERTY ALONG WITH THE OCCUPANC Y OF THE TENANT WAS SOLD TO A THIRD PARTY FOR A VERY LOW CONSIDERAT ION WHICH HAS NOT BEEN TAKEN INTO CONSIDERATION BY THE AO WHILE ADOPT ING THE FULL VALUE CONSIDERATION U/S 50C OF THE ACT. 5. ON THE OTHER HAND, THE LD. DR HAS SUBMITTED THAT THE ASSESSEE HAS FAILED TO PRODUCE ANY EVIDENCE IN SUPPORT OF TH E CLAIM THAT THE ITA NO. 692/JP/2016 LATE SMT. SEEMA MUKHERJEE VS. ITO 5 PROPERTY WAS NOT CAPABLE OF FETCHING THE SALE CONSI DERATION AS ADOPTED BY THE AO. SHE HAS RELIED UPON THE ORDERS OF THE AU THORITIES BELOW. 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WELL AS THE RELEVANT MATERIALS ON RECORD. WE FIND THAT ONCE THE ASSESSEE HAS BROUGHT THESE FACTS THAT THE PROPERTY WAS OCCUPIED BY THE OLD TEN ANT AND WAS SOLD ALONG WITH TENANCY THEN AS PER PROVISIONS OF SECTIO N 50C (2) OF THE ACT THE VALUATION OF THE PROPERTY WAS REQUIRED TO BE DE TERMINED BY THE DVO AFTER CONSIDERING ALL THE RELEVANT FACTS AFFECTING VALUE OF THE PROPERTY IN QUESTION. NO DOUBT THE PROPERTY OCCUPIED BY THE OLD TENANT CERTAINLY SUFFERS FROM DEFICIENCY IN COMPARISON TO A PROPERTY WHICH IS FREE FROM ANY SUCH ENCUMBRANCES. ACCORDINGLY WE ARE OF THE CONSIDERED VIEW THAT THE DISPUTE OF ADOPTING THE VALUATION OF THE PROPER TY IN TERMS OF SECTION 50C OF THE ACT SHALL BE DETERMINED AFTER CONSIDERIN G THE FACTORS WHICH ADVERSELY AFFECTED THE FAIR MARKET VALUE OF THE PRO PERTY. HENCE, WE SET ASIDE THIS ISSUE TO THE RECORD OF THE ASSESSING OFF ICER TO GET THE FAIR MARKET VALUE OF THE ASSESSEE THROUGH DVO. AS REGARD S THE COST OF ACQUISITION AS ON 01.04.1981 BOTH THE PARTIES ARE A T LIBERTY TO BRING THE SUPPORTING EVIDENCE FOR THE FAIR MARKET VALUE AS ON 01.04.1981. ACCORDINGLY, HE SHALL DETERMINE THE FAIR MARKET VAL UE AFTER CONSIDERING THE COMPARABLE SALE INSTANCES OR DLC RATE AS ON 01. 04.1981. ITA NO. 692/JP/2016 LATE SMT. SEEMA MUKHERJEE VS. ITO 6 7. AS REGARDS THE VALUE OF THE PROPERTY BEARING PLO T NO. 14, HATHI BABU KA BAGH, STATION ROAD, JAIPUR THE ASSESSEE HAS SUBMITTED THAT THIS PROPERTY WAS ALSO OCCUPIED BY THE OLD TENANT A ND FINALLY THE SAID PROPERTY WAS SOLD TO HIM AT VERY DEPRESSED PRICE TH EREFORE, THE AO IS NOT JUSTIFIED IN ADOPTING THE FULL VALUE CONSIDERAT ION U/S 50C OF THE ACT, BEING THE VALUATION ADOPTED BY THE STAMP VALUATION AUTHORITY. HE HAS FURTHER CONTENDED THAT THE PROPERTY WAS CONSTRUCTED BY THE TENANT HIMSELF AS IT IS EVIDENT FROM THE SALE DEEDS AND TH EREFORE, STAMP DUTY VALUATION FOR LAND AND BUILDING CANNOT BE ADOPTED W HEN THE ASSESSEE SOLD ONLY PLOT OF LAND. HENCE, THE LD. AR HAS SUBMI TTED THAT THE VALUATION ADOPTED BY THE STAMP VALUATION AUTHORITY HAS TO BE SEGREGATED FOR LAND PART OF THE SAID PROPERTY. SINC E THE TENANT HAS CONSTRUCTED THE BUILDING ON THE LAND THEREFORE, ONL Y DLC VALUE OF THE LAND CAN BE TAKEN INTO CONSIDERATION SUBJECT TO THE OTHER FACTORS THAT THE SAID PROPERTY WAS ALSO SOLD TO THE TENANT HIMSE LF WHICH WAS IN OCCUPATION. 8. THE LD. DR HAS RELIED UPON THE ORDERS OF THE AUT HORITIES BELOW. 9. WE HAVE HEARD THE RIVAL SUBMISSIONS AS WELL AS T HE RELEVANT MATERIALS ON RECORD. WE NOTE FROM THE TERMS OF THE SALE DEED AS MANIFEST THAT THE CONSTRUCTION OF THE BUILDING ON T HE SAID PLOT OF LAND ITA NO. 692/JP/2016 LATE SMT. SEEMA MUKHERJEE VS. ITO 7 BEARING NO. 14, HATHI BABU KA BAGH, STATION ROAD, J AIPUR WAS CONSTRUCTED BY THE TENANT. HOWEVER, IT IS NOT CLEAR FROM THE SALE DEED AS WHAT IS PORTION OF THE STAMP DUTY VALUATION ASSI GNED TO THE LAND AND BUILDING RESPECTIVELY. THUS, WHEN THE TENANT HIMSEL F AS CONSTRUCTED THE BUILDING THEN THE SUBJECT MATTER OF TRANSFER WAS ON LY THE LAND UNDERNEATH THE BUILDING AND THEREFORE, THE FULL VAL UE CONSIDERATION U/S 50C OF THE ACT HAS TO BE TAKEN ONLY FOR THE LAND AN D NOT FOR LAND AND BUILDING BOTH. FURTHER, SINCE THE SAID TRANSFER WAS MADE TO THE TENANT HIMSELF WHO WAS OCCUPYING THE PROPERTY, THEREFORE, THIS IS RELEVANT FACTORS FOR DETERMINING THE FAIR MARKET VALUE OF TH E PROPERTY AS PER SECTION 50C(2) OF THE ACT. ACCORDINGLY, WE SET ASID E THIS ISSUE TO THE RECORD OF THE ASSESSING OFFICER FOR DETERMINATION O F THE FAIR MARKET VALUE OF THE PROPERTY THROUGH DVO. AS FAR AS THE CO ST OF ACQUISITION BOTH THE PARTIES HAVE TO PRODUCE THEIR SUPPORTING E VIDENCE AND THE AO HAS TO DETERMINE THE FAIR MARKET VALUE AS ON 01.04. 1981 FOR THE PURPOSE OF COMPUTING THE CAPITAL GAIN. 10. AS REGARDS THE ISSUE RAISED FOR VALIDITY OF REA SSESSMENT SINCE, THE ISSUE ON MERITS IS SET ASIDE TO THE RECORD OF THE A SSESSING OFFICER, THEREFORE, WE KEEP THIS ISSUE UPON SUBJECT TO THE O UTCOME OF THE SET ASIDE PROCEEDINGS. ITA NO. 692/JP/2016 LATE SMT. SEEMA MUKHERJEE VS. ITO 8 IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOW ED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 08/06/2018. SD/- SD/- FOE FLAG ;KNO FOT; IKY JKO (VIKRAM SINGH YADAV) (VIJAY PAL RAO) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 08/06/2018. * SANTOSH. VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- LATE SMT. SEEMA MUKHERJEE, JAIPUR. 2. IZR;FKHZ@ THE RESPONDENT- ITO WARD 3(2), JAIPUR. 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDR@ CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR. 6. XKMZ QKBZY@ GUARD FILE {ITA NO. 692/JP/2016} VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASST. REGISTRAR