SUNDAR LAL GARG, Kota V. ACIT, Kota

ITA 7/JPR/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 99401 (ITAT-JAIPUR)
• Duration Of Justice: 1 year(s) 9 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-10-2015
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 2006-2007
• Appeal Filed On: 02-01-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RAJ MEHRA JCIT DR DHK
• Assessee Lawyers: B V MAHESHWARI CA A
• Section: 143(3); 154

Judgement Text

ITA NO. 7/JP/2014 SH RI SUNDER LAL GARG VS. ACIT , CIRCLE- 2, KOTA 1 VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, JAIPUR JH VKJ-IH-RKSYKUH] U;KF;D LNL; ,OA JH FOE FLAG ;KN O] YS[KK LNL; DS LE{K BEFORE: SHRI R.P. TOLANI, JM & SHRI VIKRAM SINGH YA DAV, AM VK;DJ VIHY LA-@ ITA NO. 7/JP/2014 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2006-07 SHRI SUNDER LAL GARG 134, SUBHAM CIVIL LINES STATION ROAD, KOTA CUKE VS. THE ACIT CIRCLE- 2 KOTA LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO .: AABPG 7048 Q VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI B.V. MAHESHWARI, CA A JKTLO DH VKSJ LS@ REVENUE BY : SHRI RAJ MEHRA, JCIT- DR LQUOKBZ DH RKJH[K@ DATE OF HEARING : 14/10/2015 ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 26 /10/2015 VKNS'K@ ORDER PER VIKRAM SINGH YADAV:- THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST TH E ORDER OF THE LD. CIT(A), KOTA DATED 21-10-2013 FOR THE ASSESSMENT YE AR 2006-07 WHEREIN THE ASSESSEE RAISED FOLLOWING GROUNDS IN HIS APPEAL. 1. THAT THE LD. AO GROSSLY ERRED IN MAKING THE AD DITION OF RS. 10,794/- STATING TO BE THE DIFFERENCE IN A/C OF SMT. ABHILASHA GARG. THE LD. CIT(A) ALSO ERRED IN CONFIR MING THE SAID ADDITION. 2. THAT THE LD. AO GROSSLY ERRED IN MAKING THE ADDI TION OF RS.2,15,429/- IN LONG TERM CAPITAL GAINS. THE LD. C IT(A) ALSO ITA NO. 7/JP/2014 SH RI SUNDER LAL GARG VS. ACIT , CIRCLE- 2, KOTA 2 ERRED IN SUSTAINING THE SAID ADDITION IN LONG TERM CAPITAL GAIN RS. 2,15,429/- THAT TOO WITHOUT ANY DISCUSSION. 3. THAT THE LD. AO GROSSLY ERRED IN NOT PASSING THE ORDER U/S 143(1) AND PROCEEDED DIRECTLY TO ASSESSEE U/S 143(3 ), FURTHER ON OUR APPLICATION THE ORDER U/S 154 / 143(1) WAS PASS ED ON DATED 31-07-07, WHICH WAS SERVED TO THE ASSESSEE AFTER 7- 07-08, HENCE THE ORDER PASSED U/S 143(3) IS NULL AND VOID.. 2.1 DURING THE COURSE OF HEARING, THE LD. AR OF THE ASSESSEE HAS NOT PRESSED GROUND NO. 1 AND 3. THEREFORE, THE SAME ARE DISMISSED BEING NOT PRESSED. 3.1 AS REGARDS GROUND NO. 2, BRIEF FACTS OF THE CAS E ARE THAT DURING THE YEAR THE ASSESSEE HAD SOLD A PIECE OF LAND MEASURIN G 3758.18 SQ. MTR FOR RS. 37,58,180/- OUT OF WHICH HE CLAIMED TRANSFER EXPENS ES OF RS. 1,41,809/- AND INDEXED COST OF LAND AT RS. 3,08,595/-. AS PER DETA ILS FILED BY THE ASSESSEE, HE WAS OWNING A PLOT NO. A-14, ROAD, NO. 1, JHALAWAR R OAD, KOTA MEASURING 10453.57 SQ. MTR WHICH WAS PURCHASED FROM RIICO IN 1974. THUS THE LAND SOLD WAS ABOUT 1/3 RD OF THE TOTAL AREA OF THE PLOT NO. A-14. THERE IS N O DISPUTE REGARDING THE SALE CONSIDERATION AND COST O F LAND. THE DISPUTE IS ONLY IN RELATION TO CERTAIN PAST COSTS WHICH HAS BEEN CL AIMED BY THE ASSESSEE BUT IT HAS NOT BEEN ALLOWED BY THE AO. 3.2 THE FIRST DISALLOWANCE WHICH HAS BEEN CONTESTED BY THE ASSESSEE IS IN RELATION TO TRANSFER EXPENSES OF RS. 1,03,100/-. FR OM THE ASSESSMENT ORDER, IT ITA NO. 7/JP/2014 SH RI SUNDER LAL GARG VS. ACIT , CIRCLE- 2, KOTA 3 IS NOTED THAT THE ASSESSEE HAS CLAIMED A SUM OF RS. 2100/- TOWARDS SUB DIVISION EXPENSES AND RS. 1,01,000/- TOWARDS DALALI . NO SUPPORTING DOCUMENTS HAD BEEN SUBMITTED BY THE ASSESSEE DURING THE COURSE OF ASSESSMENT PROCEEDINGS. SO, IN THE ABSENCE OF SAME, THE SAME HAD BEEN DISALLOWED BY THE AO. FURTHER DURING THE APPELLATE PROCEEDINGS, NO DOCUMENTS HAD BEEN SUBMITTED AND THE LD. CIT(A) HAD CONFIRMED THE DISALLOWANCE. 3.3 THE SECOND DISALLOWANCE IS IN RELATION TO CONST RUCTION COST OF RS. 17,000/- WHICH WAS INCURRED IN 1980 ON CONSTRUCTION OF BOUNDARY WALL AND AFTER INDEXING THE SAME, THE ASSESSEE HAD CLAIMED R S. 84,490/-. THE AO HAD ALLOWED 1/3 RD OF THE SAID COST AND DISALLOWED THE BALANCE AMOUNT ON THE GROUND THAT BOUNDARY WALL WAS CONSTRUCTED FOR WHOLE OF THE PLOT AND SINCE THE ASSESSEE HAD SOLD ONLY 1/3 RD PART OF THE PLOT THEN ONLY 1/3 RD COST SHOULD BE ALLOWED IN THE HANDS OF THE ASSESSEE WHICH HAS BEEN CONFIRMED BY THE LD. CIT(A). 3.4 THIRDLY, THE ASSESSEE CLAIMED CONSTRUCTION COST OF RS. 56,000/- TOWARDS DIVIDING WALL CONSTRUCTED IN 2005 AS PER AG REEMENT WITH THE BUYER. THE AO HAS NOT ALLOWED THE SAME IN ABSENCE OF COPY OF AGREEMENT OR ANY SUPPORTING VOUCHERS / DOCUMENTS, WHICH HAS SUBSEQUE NTLY BEEN CONFIRMED BY THE LD. CIT(A). ITA NO. 7/JP/2014 SH RI SUNDER LAL GARG VS. ACIT , CIRCLE- 2, KOTA 4 3.5 WE HAVE PERUSED THE ASSESSMENT ORDER, ORDER OF THE LD. CIT(A) AS WELL AS SUBMISSIONS OF THE LD. AR . AS FAR AS FIRST AND SECOND DISALLOWANCES ARE CONCERNED, THE SAME HAVE RIGHTLY BEEN DISALLOWED BY THE LOWER AUTHORITIES. AS FAR AS THIRD DISALLOWANCE IS CONCERNED I.E. CONS TRUCTION COST OF RS. 56,000/- WHICH HAS BEEN INCURRED IN CONNECTION WITH DIVIDING WALL CONSTRUCTED IN 2005 AS PER AGREEMENT WITH BUYER, IT IS NOTED FROM THE AGREEMENT DATED 8-11-2005 THAT THE SAID WALL HAD BE EN CONSTRUCTED WITH MUTUAL AGREEMENT BETWEEN TWO PARTIES AND THAT THEY WILL EQUALLY SHARE THE COST OF DIVIDING WALL. CONTRACTUALLY, THERE IS , TH US, AN UNDERSTANDING BETWEEN THE PARTIES THAT COST WILL BE INCURRED AND WILL BE EQUALLY BORNE BY THEM. IT IS NOT IN DISPUTE THAT THE ASSESSEE HAS IN CURRED RS. 56,000/-TOWARDS HIS SHARE OF COST OF DIVIDING WALL. IN OUR VIEW, SU CH EXPENDITURE IS CLEARLY IN RELATION TO TRANSFER OF PIECE OF LAND, THE SALE CO NSIDERATION THEREOF HAS ALREADY BEEN OFFERED FOR TAXATION. THUS THE SAME IS ALLOWED IN THE HANDS OF THE ASSESSEE. IN LIGHT OF ABOVE, RS. 56,000/- TOWAR DS COST OF DIVIDING WALL IS ALLOWED WHILE COMPUTING THE LONG TERM CAPITAL GAIN. TO THIS EXTENT, THE CONTENTION OF THE ASSESSEE IS UPHELD. ACCORDINGLY, GROUND NO. 2 OF THE ASSESSEE IS PARTLY ALLOWED. ITA NO. 7/JP/2014 SH RI SUNDER LAL GARG VS. ACIT , CIRCLE- 2, KOTA 5 4.0 IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PA RTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 26/10/20 15. SD/- SD/- VKJ-IH-RKSYKUH FOE FLAG ;KNO (R.P.TOLANI) (VIKRAM SINGH YADAV) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 26 /10/ 2015 *MISHRA VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- SHRI SUNDER LAL GARG, KOTA 2. IZR;FKHZ@ THE RESPONDENT- THE ACIT, CIRCLE- 2, KOTA 3. VK;DJ VK;QDRVIHY@ CIT(A). 4. VK;DJ VK;QDR@ CIT, 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR 6. XKMZ QKBZY@ GUARD FILE (ITA NO.7/JP/2014) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR ITA NO. 7/JP/2014 SH RI SUNDER LAL GARG VS. ACIT , CIRCLE- 2, KOTA 6