Appeal Details
Counselvise Citation
[2018] 119 COUNSELVISE.COM (IT) 5452 (ITAT-AHMEDABAD)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
3 year(s) 6 month(s) 12 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
18-10-2018
Appeal Filed By
Assessee
Order Result
Allowed
Bench Allotted
C
Assessment Year
2010-2011
Appeal Filed On
06-04-2015
Judgement Text
IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD SMC BENC H (BEFORE SHRI MAHAVIR PRASAD, JUDICIAL MEMBER & SHRI WASEEM AHMED, ACCOUNTANT MEMBER) ITA. NO: 764/AHD/2015 (ASSESSMENT YEAR: 2010-11) SHRI MAYUR B. CHOKSI L- 7/84, VIJAY NAGAR, NR. SARGAM CHAR RASTA, HARNI ROAD, VADODARA V/S INCOME TAX OFFICER, WARD- 8 (2), BARODA (APPELLANT) (RESPONDENT) PAN: AAYPC4383N APPELLANT BY : SHRI RONAK N. PARIKH, AR RESPONDENT BY : SHRI N. J. VYAS, SR. D.R. ( )/ ORDER DATE OF HEARING : 15 -10-201 8 DATE OF PRONOUNCEMENT : 18-10-2018 PER MAHAVIR PRASAD, JUDICIAL MEMBER 1. THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LD. CIT(A)-4, VADODARA DATED 06.01.2015 PERTAINING TO A.Y. 2010-1 1 AND FOLLOWING GROUNDS HAVE BEEN TAKEN: ITA NO. 764/ AHD/2015 . A.Y. 2010-11 2 1. ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE A S WELL AS LAW ON THE SUBJECT, THE LEARNED CIT(A) HAS ERRED IN MAKING ADDITION OF RS. 20,57,672/- U/S . 50C OF THE INCOME TAX ACT, 1961 ON ACCOUNT OF STCG WITHOUT REFERRING THE MATTER TO VAL UATION OFFICER. 2. 2. ON THE FACTS AND IN CIRCUMSTANCES OF THE CAS E AS WELL AS LAW ON THE SUBJECT, THE LEARNED CIT(A) HAS NOT ISSUED SHOW CAUSE NOTICE TO THE ASSE SSEE FOR MAKING ADDITION OF RS. 20,57,672/- U/S. 50C OF THE INCOME TAX ACT, 1961 ON ACCOUNT OF S TCG. 2. THE FACTS OF THE CASE ARE THAT THE ASSESSEE DERIVED SALARY FROM RSA MARKETING, AKOTA, BARODA. DURING THE YEAR UNDER CONSIDERATION, AS PER REPRESENTATIVE OF THE ASSESSEE FALGUNI SHAH C.A. SUBMITTED LETTER DAT ED 07/02/2013 SNOWING WORKING OF SHORT TERM CAPITAL LOSS AMOUNTING TO RS. 3,11,502/- ON SALE OF IMMOVABLE PROPERTY AT RUSTAMPURA , SURAT. ALSO ENCLOSED SALE DEED AMOUNTING TO RS. 66,66,000/-PURCHASED PROPERTY AT RUSTARNPURA SURAT REGISTERED AT WARD NO.2 NOTE NO. 647/B/L TOTAL 189. 4 SQR. VAR MADE ON 26/06/2008, WITH SEVEN PERSONS. THE INVESTMENT, MAD E BY THE ASSESSEE AMOUNTING TO RS. 8,32,950/- AT 12.49% OF TOTAL CONSIDERATION. THE STAMP DUTY SHOWN IN SALE DEED RS. 3,27,000/- STA MP CHARGES AND REGISTRATION FEES RS. 67,010/-. THUS TOTAL RS. 3,94,010/- EXPENDED BY THE ASSESSEE AND SEVEN PERSONS. THEREFORE RS. 49,210/- ARE T O BE PAID BY THE ASSESSEE ON THE PART OF STAMP CHARGES AND REGISTRATION FEES AT 12.49% OF TOTAL EXPENDED RS. 3,94,010/-. THE ASSESSEE ALSO PAID CONSTR UCTION EXPENSES TO SHRI. JAY VIJAY CONSTRUCTION CO. AMOUNTING TO RS. 16,12 ,500/-. 3. ALSO ENCLOSED FIVE SALE DEEDS OF RS. 42,20,000/- EA CH DATED 26/05/2009, SALE CONSIDERATIONS OF RS. 2,11,00,000/-(RS. 42,20,000/- X 5). IN WHICH THE ASSESSEE RECEIVED SALE CONSIDERATION OF RS. 21,85,000/- (RS. 4,37,000/- X 5) BEING HIS SHARE AT 10.35%. ITA NO. 764/ AHD/2015 . A.Y. 2010-11 3 4. 4. AS PER ATS DETAILS OF AIR TRANSACTIONS FURNISHED BY SUB-REGISTRAR OFFICE SURAT-2 UDHANA SALE CONSIDERATION SHOWN RS. 72,21,6 08/- INSTEAD OF RS. 42,20,0007- OF EACH FIVE SALE DEED DATED 26/05/2009 AMOUNTING TO RS. 3,61,08,040/-(RS. 72,21,608/ X 5) AS SALE CONSIDERA TION. AS PER NOT SHEET DATED 22/03/2013 REQUESTED TO THE REPRESENTATIVE OF THE A SSESSEE FALGUNI SHAH C.A. TO EXPLAINED AND SHOW CAUSE WHY THE SAID VALUE SHOU LD NOT BE CONSIDERED U/S. 50C. 5. IN RESPONSE TO THAT THE ASSESSEE'S REPRESENTATIVE C .A. FALGUNI SHAH REPLIED DATED 26/03/2013 THAT OUR CLIENT HAS RECEIVED ONLY RS. 4,37,000/-I.E. 10.35% OF THE WHOLE CONSIDERATION WHICH THE SAME IS DEPOSITED IN HIS ACCOUNT. FURTHER INFORMED THAT THE SALE VALUE OF RS. 72,21,608/- AS GIVEN BY THE SUB-REGISTRAR SURAT-2 UDHANA, IS NOT TO BE CONSIDERED AS THE O PPONENT PURCHASER OF THE SAID PROPERTY MUST HAVE PAID STAMP DUTY A HIGHER RA TE. WE HAVE NOT RECEIVED ANY AMOUNT OF RS. 72,21,608/- AS MENTIONED IN JA NTRI VALUE. ALSO SUBMITTED INDEX-2, SHOWN CONSIDERATION GROUND FLOOR PROPERTY AT RS. 42,20,000/-. ALSO ADDED THAT THE DETAILS WORKING OF SHORT TERM CA PITAL LOSS GIVEN WITH PROPER EVIDENCE AND JUSTIFICATION OF EVERY FIGU RE CONSIDERED HAS ALREADY BEEN GIVEN. ALSO ADDED AS PER NOTE SHEET DATED 26/03/201 3 THAT THE ASSESSEE AND REPRESENTATIVE C.A. FALGUNI SHAH AGREE TO FURNISH F URTHER DETAILS ON 28/03/2013. THE SAME IS NOT FURNISHED. 6. THE ASSESSEE AND OTHER SOLD THE PROPERTY SITUATED A T RUSTAMPURA SURAT WARD NO.2, NOTE NO. 646/A & 647/B/L CONSTRUCTED BUILDING IN FIVE PARTS ON 26/05/2009 TO SALASAR POLYFAB PVT. LTD. SURAT IN DI FFERENT SALE DEED AS BELOW: 1. GROUND FLOOR 2293.60 SQR FT. 2. FIRST FLOOR 2293.60 SQR. FT. ITA NO. 764/ AHD/2015 . A.Y. 2010-11 4 3. SECOND FLOOR 2293.60 SQR. FT. 4. THIRD FLOOR 2293.60 SQR. FT. 5. HIGHER GROUND FLOOR 2293.60 SQR. FT 7. AS PER SUB-REGISTRAR OFFICE SURAT-2 UDHANA SALE CONSIDERATION SHOWN RS. 72,21,608 /-INSTEAD OF RS. 42,20,000/- OF EACH FIVE SALE DEED DATED 26/05/2009 AMOUNTING TO RS. 3,61,08,040/-(RS. 72,21 ,608/X 5) AS SALE CONSIDERATION. THE SALE DEED AND TRANSFER OF CAPITA L ASSETS MADE BY WAY OF REGISTRATION WITH THE STAMP DUTY AUTHORITY SUB-REGI STRAR SURAT- 2, UDHANA. THE STATE GOVT. LEAVY STAMP DUTY ON TRANSFER OF IMMOVAB LE PROPERTIES BY WAY OF USER OF STAMP PAPERS OF DIFFERENT VALUES TO BE UTIL IZED FOR RECORDING TRANSACTIONS OF IMMOVABLE PROPERTIES. IT IS COMMONT ENDENCY OF PEOPLE TO AVOID PAYMENT OF TAXES AND DUTY AS FAR AS POSSIBLE AT A NO AMOUNT BY WAY OF SHOWING LESSER AMOUNT OF CONSIDERATION IN THE STAMP PAPER. IN ORDER TO SECURE PROPER STAMP DUTY THE STATE GOVT. HAS APPOINTED STA MP VALUATION AUTHORITY. THE MAIN FUNCTION OF VALUE AUTHORITY IS TO PREPARED VALUATION TABLES SHOWING AREA AND ITS FAR MARKET VALUE SO THAT THE ADMINISTR ATIVE MACHINERY ENGAGED IN COLLECTION OF STAMP DUTY COULD HAVE A R EADY REFERENCE TO CHARGE STAMP DUTY IRRESPECTIVE OF THE AMOUNT OF CONSIDERATION SH OWN IN THE SALE DEED. THE SUB REGISTRAR TO NOT REGISTER THE SALE DEED UNLESS AND UNTIL THE STAMP DUTY IS PAID ACCORDING TO VALUATION TABLE IRRESPECTIVE OF AMOUNT OF SALE CONSIDERATION SHOWN IN THE SALE DEED. THE STAMP VALUATION AUTH ORITY AUTHORIZED BY ACT THE VALUATION IS FIXED BY IT ARE ON THE BASIS OF CONSID ERATION OF ALL RELEVANT FACTORS EFFECTING THE VALUATION LOOKING TO DEVELOPMENT OF A REA GROWTH OF ORGANIZATION AND ALSO THE HIGHER TRANSACTION RECORDED IN RESP ECT OF ANY AREA. THE VALUATION SHOWN IN VALUATION TABLE IS MANDATORIL Y REQUIRED TO BE TAKEN IN TO CONSIDERATION UNDER THE PROVISION OF 50C OF THE I.T . ACT 1961. I THEREFORE TAKE ITA NO. 764/ AHD/2015 . A.Y. 2010-11 5 THE AMOUNT OF RS. 37,37,182/- BEING ASSESSEE'S SHAR E AT 10.35 % OF TOTAL SALE CONSIDERATION COMES TO RS.3,61,08,040/- FOR BY SUB REGISTRAR SURAT-2 UDHANA AS IT IS THE DEEM TO THE FULL VALUE OF THE CONSIDERATI ON RECEIVED BY THE ASSESSEE AS A RESULT OF TRANSFER OF THE PROPERTY UNDER CONSIDERAT ION. U/S. 50C WHEN STAMP DUTY VALUATION PROPERTY IS HIGHER THAN APPARENT SAL E CONSIDERATION SHOWN IN THE INSTRUMENT OF TRANSFER THAN ONUS TO PROVE THAT FAIR MARKET VALUE OF THE PROPERTY IS LOWER THAN SVA IS ON THE ASSESSEE WHO CAN REASON ABLE DISCHARGE THIS ONUS BY SUBMITTING NECESSARY MATERIALS AT THE TIME OF ASSES SMENT PROCEEDINGS. IN THIS CASE AS NARRATED ABOVE AND FACT OF THE CASE PROVISI ON OF SECTION 50C OF THE ACT ARE ATTRACTED. THEREFORE CAPITAL GAIN IS WORKED OUT AS PER PROVISION OF SECTION 50C. AND FINALLY SHORT TERM CAPITAL GAIN WAS WORKED OUT AT RS. 20,57,672/-. 8. AGAINST THE ORDER OF LD. A.O., ASSESSEE PREFERRED F IRST STATUTORY APPEAL BEFORE THE LD. CIT(A) BUT TO NO AVAIL. 9. WE HAVE GONE THROUGH THE RELEVANT RECORD AND IMPUGN ED ORDER. ASSESSEE HAVING INCOME FROM SALARY, SHORT TERM CAPITAL LOSS & BANK F.D. INTEREST ETC. ASSESSEE FILED THE RETURN OF INCOME FOR A.Y. 2010-1 1 ON 02.04.2011 DECLARING TOTAL INCOME OF RS. 92,400/-. DURING THE COURSE OF ASSESSMENT, APPELLANT FILED ALL NECESSARY DOCUMENTS AND DETAILED SUBMISSIONS AN D DURING ASSESSMENT PROCEEDING, ASSESSEE RAISED AN OBJECTION TOWARDS VA LUATION OF THE PROPERTY. BUT A.O. DID NOT BOTHER TO REFER MATTER TO THE DVO. IN APPELLANT PROCEEDINGS AT PAGE NO. 11 AT PARA 6.5 LD. CIT(A) CLEARLY MENTIONE D THAT ASSESSEES ONLY OBJECTION TO APPLICATION OF SECTION 50C IS THAT THE ASSESSING OFFICER DID NOT REFER HIS CASE TO THE VALUATION OFFICER FOR DETERMI NATION OF FAIR MARKET VALUE BECAUSE DESPITE THE FACT THAT APPELLANT RAISED AN O BJECTION BEFORE THE LOWER AUTHORITIES FOR REFERRING THE MATER TO DVO FOR DETE RMINATION OF FAIR MARKET ITA NO. 764/ AHD/2015 . A.Y. 2010-11 6 VALUE BUT LOWER AUTHORITIES DID NOT BOTHER. THEREFO RE, IN OUR CONSIDERED OPINION, STAND OF THE REVENUE IS NOT SUSTAINABLE. T HEREFORE, WE SET ASIDE THE ORDER OF THE A.O. AND REMAND THIS MATTER BACK TO TH E ASSESSING OFFICER WHO WILL REFER THIS MATTER TO THE FILE OF THE DVO. THER EAFTER WILL DECIDE THE MATTER IN ACCORDANCE WITH LAW. 10. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS ALLO WED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN OPEN COURT ON 18- 10- 2018 SD/- SD/- (WASEEM AHMED) (MAHAVIR PRASAD) ACCOUNTANT MEMBER TRUE COPY JUDICIAL MEMBER AHMEDABAD: DATED 18/10/2018 RAJESH COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT,AHME DABAD
