P.Ashok Kumar (HUF), Tirupati V. Dy. Commissioner of Income Tax , Central Circle, Tirupati

ITA 711/Hyd/2018

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 7039 (ITAT-HYDERABAD)
• Duration Of Justice: 2 year(s) 4 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-09-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB-A
• Next Hearing Date: 03-09-2020
• Assessment Year: 2009-2010
• Appeal Filed On: 18-04-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N SWAPNA
• Assessee Lawyers: S RAMA RAO
• Keywords: Capital asset; Cost of acquisition; Set aside; Capital Gains
• Section: 143(3); 54F; 48; 148

Judgement Text

ITA NOS 711 AND 712 OF 2018 P ASHOK KUMAR HUF TIRUP ATI.. PAGE 1 OF 11 IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD A BENCH, HYDERABAD (THROUGH VIDEO CONFERENCING) BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI D.SUNDER SINGH, ACCOUNTANT MEMBER ITA NOS.711 AND 712/HYD/2018 ASSESSMENT YEAR:2009-10 SHRI P ASHOK KUMAR (HUF) TIRUPATI PAN:AAJHP7373J VS. DY. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE, TIRUPATI (APPELLANT) (RESPONDENT) ASSESSEE BY: SRI S.RAMA RAO REVENUE BY : SMT. N. SWAPNA, DR DATE OF HEARING: 03/09/2020 DATE OF PRONOUNCEMENT: 09/09/2020 ORDER PER D.S. SUNDER SINGH, A.M. ITA/711/H/18 THE ASSESSEE FILED THE RETURN OF INCOME DECLARING T HE TOTAL INCOME OF RS.52,10,443/- AND AGRICULTURAL INC OME OF RS.1,50,000/-ON 22/11/2010, SUBSEQUENT TO THE SEARC H CONDUCTED IN THE RESIDENCE OF DR. K. RAMACHANDRA RA O AND THE ASSESSEE. THE PRESENT ASSESSMENT YEAR IS THE YEAR O F SEARCH. DURING THE ASSESSMENT PROCEEDINGS, THE AO OBSERVED THAT THE ASSESSEE HAD ENTERED INTO A JOINT DEVELOPMENT AGREE MENT(JDA) ON 7.12.2005 WITH SHRI P. RAJASHEKAR RAO, S/O LATE PAD ARTHI KRISHNAMA NAIDU TO DEVELOP 18666 SQ. FT OF THE LAND OWNED BY SRI ASHOK KUMAR (HUF) AT SURVEY NO.413 AND 414, ASHOK N AGAR, TIRUPATI INTO A RESIDENTIAL COMPLEX CALLED ASHOK E NCLAVE. BY VIRTUE OF THIS AGREEMENT, THE LAND OWNED BY THE ASS ESSEE WAS ITA NOS 711 AND 712 OF 2018 P ASHOK KUMAR HUF TIRUP ATI.. PAGE 2 OF 11 CONVERTED TO RESIDENTIAL COMPLEX IN WHICH THE RATIO OF DIVISION BETWEEN THE OWNER AND THE DEVELOPER WAS FIXED AT 59 :41 AND THE ASSESSEE TO RECEIVE 24100 SQ. FT OF CONSTRUCTED ARE A. DURING THE POST SEARCH ENQUIRIES, THE ASSESSEE HAD ADMITTED TH E UNDISCLOSED INCOME OF RS.1.00 CRORE ON THE BASIS OF INFORMATION PROVIDED BY SHRI P.RAJASEKHAR RAO, THE BUILDER, BUT SUBSEQUENTL Y RETRACTED FROM THE STATEMENT AND DID NOT FILE THE RETURN OF I NCOME AS ADMITTED IN THE STATEMENT DATED 12/05/2009. THE ASS ESSEE FILED RETURN OF INCOME ADMITTING CAPITAL GAIN OF RS.40,26 ,784/- ON 22.11.2010 SUBSEQUENT TO THE SHOW CAUSE NOTICE ISSU ED BY THE AO ON 15.11.2010. THE ASSESSEE HAS COMPUTED THE LON G-TERM CAPITAL GAIN AS UNDER: 2. THE ASSESSEE HAS RECEIVED 20 FLATS FROM THE BUIL DER. AS PER THE INFORMATION COLLECTED FROM THE BUILDER BY T HE AO, THE COST OF CONSTRUCTION OF CONSTRUCTED AREA RECEIVED BY THE ASSESSEE WAS WORKED OUT TO RS.1,51,70,200/-. HOWEVER, THE ASSESS EE DID NOT ACCEPT THE VALUE AND WORKED OUT THE SAME AT RS.1,26 ,50,000/- @ RS.550/- PER SQ.FT, AS PER THE QUALITY OF CONSTRUCT ION DELIVERED BY COST OF APARTMENTS REC EIVE D 1,26,50,000 DATE OF PURCHASE OF LAND 17.4.1964 THE AREA OF THE LAND PURCHASED 2080 SQ.FT LAND AVAILABLE AFTER DISPOSAL IN THE PAST 1954.30 SQ.YARDS TOTAL LAND HANDED OVER TO BUILDER 1954.30 SQ.YARD LESS:LAND USED FOR CONSTRUCTION OF OWNERS FLA T 797.57 SQ.YARDS LAND APPORTIONED TO BUILDER (IN SQ.Y) 1147.73 SQ.YARD LAND APPORTIONED TO BUILDER (IN SQ.FT) 10329.57 SQ. FT COST OF THE LAND CONSIDERED AS AT 1.4.1981 RS.100/-PER. S.FT VALUE OF THE LAND AS ON 1.4.81 RS.10,32,957 LESS:INDEXED COST OF SITE 10,32,957*582/100 60,11,8 10 LONG TERM CAPITAL GAINS 66,38,190 LESS:EXEMPTION UNDER SECTION 54F 26,11,406 CAPITAL GAINS LIABLE FOR TAX 40,26,784 INVESTMENT IN RESIDENTIAL BUILDING (4147 @ 1200 PER SQ.FT) 49,76,400 PROPORTIONATE EXEMPTIO N 4976400/12650000*6638190 26,11,406 ITA NOS 711 AND 712 OF 2018 P ASHOK KUMAR HUF TIRUP ATI.. PAGE 3 OF 11 THE BUILDER WHICH WAS NOT ACCEPTED BY THE AO. THE AO THE COMPUTED CAPITAL GAINS AS UNDER: 3. WHILE DETERMINING THE CAPITALS GAINS, THE AO ADO PTED THE VALUE OF THE PROPERTY AT RS.125/-SQ. YARDS AS O N 1.4.1981 AS AGAINST RS.900/- PER SQ. FT CLAIMED BY THE ASSESSEE . SIMILARLY, THE AO CONSIDERED THE SALE OF CONSIDERATION RECEIVED AS PER THE JOINT DEVELOPMENT AGREEMENT AT RS.1,48,40,450/- AS AGAINS T RS.1,26,50,000/- ADMITTED BY THE ASSESSEE. THE ASSE SSEE HAS CLAIMED EXEMPTION U/S 54F WHICH WAS NOT ALLOWED BY THE AO. 3.1 AGAINST THE ORDER OF THE AO, THE ASSESSEE WENT ON APPEAL BEFORE THE CIT (A) AND THE LEARNED CIT (A) U PHELD THE SALE CONSIDERATION OF RS.1,48,40,450/-. THE LD.CIT (A) D ECLINED TO ENTERTAIN THE CLAIM OF THE ASSESSEE WITH REGARD TO ALLOWING THE INDEXED COST OF EXISTING BUILDING ON THE SAID LAND AS ON 1.4.1981 SALE OF CONSIDERATION AS PER THE VENTURE AGREEMENT DT. 7.12.2005 (AS PER THE VALUE PROVIDED BY THE BUILDER TOWARDS COST OF CONSTRUCTION OF THE AREA ALLOCATED TO THE OWNE4R OF THE LAND 1,48,40,450 VALUE OF THE PROPERTY AS ON 1.4.1981 @ RS.125/- PER SQ.YARD AS PROVIDED BY THE SRO 18667 SQ.FT X RS.125 9 2,59,263 INDEXED COST OF ACQUISITION 2,59,263 X 463 100 12,00,388 SINCE ONLY 59% OF THE LAND IS PASSED ON TO THE BUILDER, 59% OF RS.12,00,388 SHOULD ALONE BE CONSIDERED 12,00,388 X 59 100 7,08,228= 1,41,32,222 LESS: EXPENDITURE ON LEVELING AS CLAIMED BY THE ASSESSEE 2,00,000 ELIGIBLE LONG TERM CAPITAL GAINS 1,39,32,222 LESS: ALLOWABLE DEDUCTION U/S 54F IN RESPECT OF THE VALUE OF ONE RESIDENTIAL UNIT OUT OF 20 UNITS: 1,48,40,450 20 7,42,022 TAXABLE LONG TERM CAPITAL GAINS 1,31,90,199 ITA NOS 711 AND 712 OF 2018 P ASHOK KUMAR HUF TIRUP ATI.. PAGE 4 OF 11 IN THE ABSENCE OF ANY MENTION IN THE JDA AND NON-FU RNISHING OF ANY PROOF. THE LD.CIT(A) ALLOWED THE DEDUCTION U/S 54F TO THE EXTENT OF RS.22,80,915/- AS AGAINST THE CLAIM OF TH E ASSESSEE FOR AN AMOUNT OF RS.49.76 LAKHS. AGGRIEVED BY THE ORDER OF THE LEARNED CIT(A) ASSESSEE THE ASSESSEE IS IN APPEAL B EFORE THIS TRIBUNAL AND RAISED THE FOLLOWING GROUNDS OF APPEAL : 1) THE ORDER OF THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) IS ERRONEOUS TO THE EXTENT IT IS PREJ UDICIAL TO THE APPELLANT. 2) THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) ERRED IN HOLDING THAT THE CAPITAL GAIN ARISING ON ENTERING INTO THE DEVELOPMENT AGREEMENT IS TAXABLE FOR THE ASSESSMENT YEAR 2009-10. 3) THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN CONFIRMING THE ACTION OF THE ASSESSING OFF ICER IN ADOPTING THE SALE CONSIDERATION AT RS.1,48,40,45 0/- 4) THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) OUGHT TO HAVE DIRECTED THAT THE VALUE OF THE PROPER TY RECEIVED IS ONLY RS.1,26,50,000/- AND NOT RS.1,48,40,450/-. 5) THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) ERRED IN NOT CONSIDERING THE GROUND THAT THERE WAS A RESIDENTIAL BUILDING ON THE SAID LAND AS ON 01.04.1 981 AND THAT THE INDEXED COST OF THE SAID BUILDING SHOU LD HAVE BEEN TAKEN FOR THE PURPOSE OF DETERMINING THE CAPITAL GAIN. 6) THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN LIMITING THE CLAIM FOR DEDUCTION U/S 54F T O RS.22,80,850/- WITHOUT CONSIDERING THE COST ON IMPROVEMENTS TO THE CONSTRUCTED AREA. 7) ANY OTHER GROUND OR GROUNDS THAT MAY BE URGED AT THE TIME OF HEARING. 4. GROUND NO.1 AND 7 ARE GENERAL IN NATURE WHICH DO ES NOT REQUIRE SPECIFIC ADJUDICATION. 5. GROUND NO.2 RELATED TO THE DISPUTE WITH REGARD T O THE TAXABILITY OF INCOME IN THE A.Y 2009-10 FOR WHICH NO ARGUMENT WAS ITA NOS 711 AND 712 OF 2018 P ASHOK KUMAR HUF TIRUP ATI.. PAGE 5 OF 11 ADVANCED BY THE LEARNED AR. HENCE, THE SAME IS DISM ISSED AS NOT PRESSED. 6. GROUND NO.5 IS RELATED TO EXISTENCE OF RESIDENTI AL BUILDING ON THE SAID LAND AS ON 1.4.1981AND THE CLAIM FOR COST OF ACQUISITION WHICH WAS NOT CONSIDERED BY THE LEARNED CIT (A) FOR THE PURPOSE OF DETERMINING THE CAPITAL GAINS. THE LD.CIT(A) DIS MISSED THE ASSESSEES CLAIM IN THE ABSENCE OF ANY MENTION WITH REGARD TO EXISTENCE OF THE BUILDING AND NO MATERIAL EVIDENCE PLACED BY THE ASSESSEE BEFORE THE LD.CIT(A). DURING THE APPEAL HE ARING, THE LEARNED AR DID NOT MAKE ANY ARGUMENT ON THIS ISSUE RELATING TO GROUND NO.5 AND HENCE, THE SAME IS DISMISSED AS NOT PRESSED. 7. GROUND NO.3 AND 4 ARE RELATED TO ADOPTING THE S ALE CONSIDERATION FOR TRANSFER OF LAND AND THE RECEIPT OF CONSTRUCTED AREA AS PER THE JDA. DURING THE APPEAL HEARING, THE LEARNED AR ARGUED THAT THE SALE CONSIDERATION (COST OF BUILT U P AREA FROM THE BUILDER) RECEIVED BY THE ASSESSEE REQUIRED TO BE WO RKED OUT AT RS.550/- SQ. FT BUT NOT THE MARKET VALUE AS COMPUTE D BY THE AO. IF THE SALE CONSIDERATION IS TAKEN AT RS.550/- PER SQ. FT , THE LEARNED AR CONTENDED THAT ONLY THE NET CONSTRUCTED AREA RECEIVED BY THE ASSESSEE REQUIRED TO BE CONSIDERED PROPORTIO NATELY. THE SALE CONSIDERATION OVER AND ABOVE BUILT UP AREA NEE DS TO BE EXCLUDED, SINCE, THE SAME WAS COMMON AREA AND NOT R ECEIVED BY THE ASSESSEE. THE LEARNED AR ARGUED THAT THE ASSESS EE HAS RECEIVED THE BUILT UP AREA OF 23000 SQ. FT, THE COS T OF WHICH NEEDS TO BE TAKEN AS SALE CONSIDERATION FOR COMPUTING THE CAPITAL GAINS IN THE HANDS OF THE ASSESSEE, INSTEAD OF 24,100 SQ. FT AS PER JDA. OUT OF THE TOTAL AREA OF RS.24,100 SQ.FT, 1100 SQ. FT WAS NOT ACTUALLY RECEIVED BY THE ASSESSEE. THEREFORE, SUBMI TTED THAT BOTH ITA NOS 711 AND 712 OF 2018 P ASHOK KUMAR HUF TIRUP ATI.. PAGE 6 OF 11 THE LEARNED CIT (A) AND THE AO HAVE ERRED IN TAKING THE MARKET VALUE FOR THE ENTIRE CONSTRUCTED AREA AS PER JDA IN STEAD OF THE ACTUALLY RECEIVED BY THE ASSESSEE. ON A QUERY, FROM THE BENCH, THE LEARNED AR SUBMITTED THAT THE SUM OF RS.550/- PER S Q. FT WAS ARRIVED ON ESTIMATION BASIS IN THE ABSENCE OF MARKE T INFORMATION FROM THE SRO. 8. ON THE OTHER HAND, THE LEARNED DR SUPPORTED THE ORDERS OF THE LOWER AUTHORITIES. 9. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL PLACED ON RECORD. IN THIS CASE THE AO HAS TAKEN THE SALE CONSIDERATION AS PER THE BOOKS OF THE DEVELOPER OF THE PROJECT PROPORTIONATELY TO THE SHARE OF THE ASSESSEE AND EX CLUDED THE ADMINISTRATIVE EXPENSES AND WORKED OUT THE SUM OF R S. 1,48,40,450/-. THE CONTENTION OF THE ASSESSEE IS TO ADOPT THE COST OF CONSTRUCTION AT RS.550/- PER SQ. FT FOR 23000 SQ . FEET AGAINST THE PROPORTIONATE COST TO THE BUILDER. SECONDLY THE ASSESSEE CONTENDED THAT ONLY THE ACTUAL BUILT-UP AREA TO BE TAKEN AS SALE CONSIDERATION FOR COMPUTING THE CAPITAL GAINS. THER E WAS NO MATERIAL EVIDENCE FURNISHED BY THE ASSESSEE TO SUPP ORT THE COST OF CONSTRUCTION (SALE CONSIDERATION) TO BE AT RS.550/- PER SQ. FT. AS CLAIMED BY THE ASSESSEE. AT THE SAME TIME, THE ASSE SSEE CLAIMED THE DEDUCTION U/S 54F @ RS.1200/- PER SQ. FEET AND THERE WAS APPARENT INCONSISTENCY IN THE CLAIM OF THE ASSESSEE . THE CORRECTNESS OF COST OF CONSTRUCTION STATED TO BE IN CURRED BY THE BUILDER ALSO NEEDS VERIFICATION AND CANNOT BE APPLI ED BLINDLY. IN THE ABSENCE OF PROPER INFORMATION, IT IS OBLIGATION OF THE AO TO REFER THE COST OF CONSTRUCTION TO THE VALUATION CE LL OR TO OBTAIN THE MARKET INFORMATION FROM THE SRO TO ARRIVE AT THE SA LE ITA NOS 711 AND 712 OF 2018 P ASHOK KUMAR HUF TIRUP ATI.. PAGE 7 OF 11 CONSIDERATION FOR THE CONSTRUCTED AREA RECEIVED BY THE ASSESSEE TOWARDS HIS SHARE. THEREFORE, WE ARE OF THE VIEW TH AT THIS ISSUE NEEDS TO BE VERIFIED BY THE AO AND HENCE WE REMIT T HE MATTER BACK TO THE FILE OF THE AO WITH A DIRECTION TO RE-W ORK THE COST OF CONSTRUCTION ON THE BASIS OF PROPER EVIDENCE OR BY REFERRING TO THE VALUATION CELL OR OBTAINING THE INFORMATION FROM TH E SRO. ACCORDINGLY, WE SET ASIDE THE ISSUE BACK TO THE FIL E OF THE AO WITH A DIRECTION TO RE-ESTIMATE AND DETERMINE THE SALE C ONSIDERATION TO COMPUTE THE CAPITAL GAINS. IT IS NEEDLESS TO SAY TH AT THE AO IS REQUIRED TO GIVE SUFFICIENT OPPORTUNITY TO THE ASSE SSEE. ACCORDINGLY, THE APPEAL OF THE ASSESSEE ON THIS GRO UND IS ALLOWED FOR STATISTICAL PURPOSES. 10. THE NEXT ISSUE IS THE AREA FOR WHICH THE SALE C ONSIDERATION TO BE TAKEN FOR COMPUTING THE CAPITAL GAINS. ACCORDING TO THE AO AS PER THE JDA 24100 SQUARE FEET WAS RECEIVED WHERE, A S PER THE ASSESSEE 23000 SQUARE FT. WE FIND SOME INCONSISTENC Y IN THIS REGARD. DURING THE APPEAL HEARING THE LD.AR SUBMITT ED THAT THE BALANCE 1100 SQ FT REPRESENT THE COMMON AREA WHERE, AS PER THE LD.CIT(A)S ORDER THE ASSESSEE CONTENDED THAT HE HA D NOT RECEIVED THE 1100 SQ. FT. NO EVIDENCE WAS PLACED BEFORE THE LD.CIT(A) OR BEFORE US WITH REGARD TO NON-RECEIPT OF THE AREA OF 1100 SQ FT FROM THE BUILDER. IF THE SAME REPRESENT THE COMMON AREA, WE ARE OF THE VIEW THAT COMMON AREA ALSO TO BE CONSIDERED FOR SAL E CONSIDERATION AS PER JDA. THEREFORE WE, REMIT THE M ATTER BACK TO THE FILE OF AO TO EXAMINE THE ISSUE WITH REGARD TO CONSTRUCTED AREA RECEIVED BY THE ASSESSEE WITH THE JDA AND THE BUILD ER AND DECIDED THE ISSUE ON MERITS AFTER GIVING OPPORTUNIT Y TO THE ASSESSEE. THE APPEAL OF THE ASSESSEE ON THIS ISSUE IS ALLOWED FOR STATISTICAL PURPOSES. ITA NOS 711 AND 712 OF 2018 P ASHOK KUMAR HUF TIRUP ATI.. PAGE 8 OF 11 11. GROUND NO.6 IS RELATED TO DEDUCTION U/S 54F OF THE I.T. ACT. THE LD.CIT (A) ALLOWED THE DEDUCTION OF RS. RS .22,80,850/- AGAINST THE CLAIM OF RS.49,76,400/- BY THE ASSESSEE IN PARA 5.3.11 WHICH READS AS UNDER: 5.3.11. THE THIRD ISSUE TO BE DECIDED IS THE DEDUC TION U/S 54F OF THE ACT. THE APPELLANT ARGUED THAT HE HA S RETAINED 4147 SQ.FT FOR HIS RESIDENCE ON 1 ST FLOOR. THE APPELLANT FURTHER ARGUED THAT AN AMOUNT OF RS.26,95,550/- WAS EXPENDED IN FURTHER IMPROVING TH E PROPERTY. FURTHER IMPROVING THE PROPERTY. EXCEPT ARGUING THE CASE FOR EXPENDITURE, THE AUTHORIZED REPRESENTATIVE OF THE APPELLANT HAS NOT FURNISHED A NY MATERIAL TO SUPPORT HIS CLAIM. THERE IS NO DISPUTE REGARDING THE ELIGIBILITY OF CLAIM U/S.54F. THE ONL Y CONTENTION IS THE QUANTUM OF ALLOWANCE. THE ASSESSI NG OFFICER HAS ALLOWED THE VALUE OF RS.7,42,022/- BEIN G ONE UNIT OF HOUSE OUT OF 20 UNITS AS AGAINST THE TO TAL COST OF PROJECT OF RS.1 ,48,40,450/- (1,48,40,45012 0 = 7,42,02.2). THERE IS NO MATERIAL BEFORE ME TO COME TO THE CONCLUSION THAT THE APPELLANT HAS BEEN USING TH E ENTIRE FIRST FLOOR OF 4147 SQ. FT. FOR RESIDENTIAL PURPOSE. WHAT IS AVAILABLE ON RECORD IS THAT THE HOUSING PRO JECT CONSISTS OF 20 FLATS. IT IS THE LEGAL RESPONSIBILIT Y OF THE APPELLANT TO ADDUCE MATERIAL IN SUPPORT OF HIS CLAI M. THE ASSESSING OFFICER HAS ALSO NOT ESTABLISHED AS T O WHAT IS THE EXTENT OF EACH UNIT IN THE PROJECT. INS TEAD, THE ASSESSING OFFICER HAD ADOPTED CRUDE METHOD TO ARRIVE THE PRICE OF SINGLE UNIT BY DIVIDING THE TOT AL BUILT UP AREA BY NUMBER OF UNITS. SINCE THE COST OF CONSTRUCTION OF RS.5501 - PER SQ. FT. WAS NOT DISPU TED, THE ASSESSING OFFICER WOULD HAVE ADOPTED THE SAME RATE FOR SINGLE UNIT AND WOULD HAVE ALLOWED THE DEDUCTION OF CLAIM U/S.54F OF THE ACT. I HAVE SEEN THAT THE APPELLANT HAD FILED COMPUTATION OF CAPITAL GAIN S BEFORE THE ADIT (LNV.) ON 19.05.2009 CLAIMING THE VALUE OF RS.13,25,500/- U/S.54F AS THE VALUE OF TWO ADJACENT FLATS. PRIOR TO THIS, THE APPELLANT HAS FI LED ANOTHER STATEMENT ON 15.05.2009 CLAIMING DEDUCTION U/S.54F TO AN EXTENT OF RS.36,00,000/-. FINALLY, ON 22.11.2010 WHEN THE RETURN OF INCOME WAS FILED, THE APPELLANT HAD MADE A CLAIM FOR 4147 SQ. FT. AT CL C OST OF RS.1,2001- PER SQ. FT. AND THE DEDUCTION WAS CLAIMED AT RS.49,76,4001-. A PROPORTIONATE CLAIM OF EXEMPTION WAS MADE AT RS.26, 11,406/ - (49,76,400/1,26,50,000 X 66,38,190). THUS, THE APPELLANT'S CLAIM U/S. 54F IS SIMILAR TO THAT OF VA LUE OF PROJECT WHERE DIFFERENT CLAIMS WERE MADE AT DIFFERE NT POINTS OF TIME. IT IS NOT KNOWN WHY THE COST OF RS. 1 ,2001 - IS ADOPTED WHEN THE RATE IS RS.5501 - PER S Q. FT.? IF THE CLAIM OF SELF SELF USE OF 4147 SQ. FT. IS AGREED SINCE FILED IN THE RETURN OF INCOME, THE VALUE COUL D BE ITA NOS 711 AND 712 OF 2018 P ASHOK KUMAR HUF TIRUP ATI.. PAGE 9 OF 11 22,80,850/- (4147 X 550). THUS, THE ASSESSING OFFIC ER IS DIRECTED TO WORK OUT THE PROPORTIONATE CLAIM U/S .54F BY ALLOWING 4147 SQ. FT INSTEAD OF SINGLE UNIT. IT IS SEEN THAT THERE IS NO WHISPER OF IMPROVEMENT OF THE FLAT IN THE CALCULATIONS FURNISHED BY THE APPELLANT EXCEPT MENTIONING THE COST OF IMPROVEMENT OF RS.26,95,5501 -. IN VIEW OF THE ABOVE OBSERVATIONS, THE CLAIM OF EXPENDITURE OF RS.26,95,550/- IS NOT CONSIDERED. 12. DURING THE APPEAL HEARING, SINCE THE LEARNED AR DID NOT MAKE ANY ARGUMENT OR PRODUCE ANY EVIDENCE IN SU PPORT OF THE GROUND. THEREFORE, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LEARNED CIT (A). HOWEVER, THE LEARNED CIT(A) ALLOWE D THE DEDUCTION @RS.550/- PER SQ FEET FOR 4147 SQUARE FEET AS PER T HE SALE CONSIDERATION CLAIMED BY THE ASSESSEE. SINCE WE HAV E REMITTED THE ISSUE OF SALE CONSIDERATION TO THE FILE OF THE AO, WE DIRECT THE AO TO ALLOW THE DEDUCTION AS PER THE SALE CONSIDERATIO N DETERMINED BY THE AO IN GROUND NO.3&4 OF THIS ORDER. ITA NO.712/HYD/2018 13. THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER PASSED BY THE LD.CIT (A) AGAINST THE ORDER OF THE AO PASSED U/S 143(3) R.W.S. 147 OF THE I.T. ACT. IN THIS ASSE SSEE, THE ASSESSMENT WAS COMPLETED ORIGINALLY U/S 143(3) OF T HE ACT, BY AN ORDER DATED 24/12/ 2010 AND DETERMINED THE TOTAL INCOME OF RS.1,43,78,358/-. OUT OF TOTAL INCOME DETERMINED BY THE AO, THE LONG TERM CAPITAL GAIN WAS DETERMINED BY THE AO AT RS. 1,31,90,199/-. THE ASSESSMENT WAS REOPENED SUBSEQUE NTLY FOR VERIFICATION OF CAPITAL GAINS TO BE ASSESSED UNDER SHORT TERM OR UNDER LONG TERM CAPITAL GAINS. THEREFORE, THE AO BE LIEVED THAT THE INCOME HAD THE ESCAPED ASSESSMENT AND ACCORDINGLY R EOPENED THE ASSESSMENT AND ISSUED THE NOTICE U/S 148. HOWEVER, AT THE END, THE AO DID NOT FIND ANY MISTAKE IN THE ASSESSMENT O F LONG-TERM ITA NOS 711 AND 712 OF 2018 P ASHOK KUMAR HUF TIRUP ATI.. PAGE 10 OF 11 CAPITAL GAIN AND THUS ACCEPTED THE LONG-TERM CAPITA L GAIN ORIGINALLY ASSESSED. THE ASSESSMENT U/S 143(3) R.W. S 147 WAS COMPLETED ON TOTAL INCOME OF RS.1,43,78,858/- BY AN ORDER DATED 30/03/2013, WHICH WAS ORIGINALLY ASSESSED. HOWEVER, THE AO DID NOT ALLOW THE RELIEF GRANTED BY THE LEARNED CIT (A) . 14. THE ASSESSEE WENT ON APPEAL BEFORE THE LD.CIT ( A) CHALLENGING THE VALIDITY OF THE NOTICE ISSUED U/S 1 48 OF THE I.T. ACT AND THE LD. CIT (A) UPHELD THE NOTICE. AGAINST WHIC H THE ASSESSEE IS IN APPEAL BEFORE US. 15. THE LEARNED AR ARGUED THAT SINCE THERE WAS NO C HANGE IN THE QUANTUM OF INCOME OR THE TAX PAYABLE BY THE ASSESSEE, AS DETERMINED BY THE AO VIDE ORDER DATED 24.10.2010, T HERE IS NO CASE FOR ISSUE OF NOTICE U/S 148, HENCE REQUESTED T O QUASH THE RE- ASSESSMENT PROCEEDINGS. THE LEARNED AR ALSO ALTERNA TIVELY SUBMITTED TO ALLOW THE RELIEF GRANTED BY THE LEARNE D CIT (A) IN ORIGINAL ASSESSMENT. ON THE OTHER LAND, THE LEARNED DR SUPPORTED THE ORDER OF THE LOWER AUTHORITIES. 16. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL PLACED ON RECORD. IN THE INSTANT CASE THE ORIGINAL ASSESSMENT RESULTED IN DETERMINING THE TOTAL INCOME OF RS.1,43,73,850/- AND THE RE-ASSESSMENT ALSO RESULTE D IN SAME INCOME. IN BOTH THE ASSESSMENTS I.E. ORIGINAL AS WE LL AS RE- ASSESSMENT, THE AO ASSESSED THE CONSTRUCTED AREA RE CEIVED UNDER JDA AS LONG-TERM CAPITAL GAINS. THOUGH THE ASSESSME NT WAS REOPENED FOR COMPUTING THE CAPITAL GAINS UNDER THE HEAD SHORT TERM OR LONG-TERM CAPITAL GAINS, ULTIMATELY THE AO DID NOT FIND ANY MISTAKE IN HIS ORIGINAL ORDER THUS ACCEPTED THE INC OME ORIGINALLY ITA NOS 711 AND 712 OF 2018 P ASHOK KUMAR HUF TIRUP ATI.. PAGE 11 OF 11 ASSESSED. SINCE THERE WAS NO ESCAPEMENT OF INCOME F OUND BY THE AO, THE REASSESSMENT BECOMES INFRUCTUOUS. ACCORDING LY, THE REASSESSMENT MADE U/S 143(3) R.W.S. 147 IS TREATED AS INFRUCTUOUS AND THE SAME IS ANNULLED. 17. IN THE RESULT, APPEALS OF THE ASSESSEE IN ITA N O.711 ARE ALLOWED FOR STATISTICAL PURPOSES AND APPEAL NO.712 IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 9 TH SEPTEMBER, 2020. SD/- SD/- (P. MADHAVI DEVI) JUDICIAL MEMBER (D.S.SUNDER SINGH) ACCOUNTANT MEMBER HYDERABAD, DATED 9 TH SEPTEMBER, 2020. VINODAN/SPS COPY TO: 1 SHRI P. ASHOK KUMAR (HUF), D.NO.18-2-107, ASHOK N AGAR, TIRUPATI 2 DY. CIT, CENTRAL CIRCLE, AAYAKAR BHAVAN, KT ROAD, TIRUPATI 3 CIT (A)-3 VISAKHAPATNAM 4 PR. CIT CENTRAL, VISAKHAPATNAM 5 THE DR, ITAT HYDERABAD 6 GUARD FILE BY ORDER