The ITO, Ward-1(1), Surat V. M/s. Ashoka Fashions Pvt.Ltd., Surat

ITA 791/AHD/2010

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 60429 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 2 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-05-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2007-2008
• Appeal Filed On: 15-03-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DINESHCHANDRA SHARMA
• Keywords: Unexplained investment; Sale consideration of property below Jantri Value; Capital asset
• Section: 50C

Judgement Text

, , , , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, AHMEDABAD , .. , '# ' $ BEFORE SHRI MUKUL KR.SHRAWAT, JUDICIAL MEMBER AND SHRI T.R. MEENA, ACCOUNTANT MEMBER ./ I.T.A. NO.791/AHD/2010 ( & ' & ' & ' & ' / / / / ASSESSMENT YEAR : 2007-08) INCOME TAX OFFICER WARD-1(1) SURAT & & & & / VS. M/S.ASHOKA FASHIONS PVT.LTD. 261/B, GIDC, PANDESARA SURAT ( '# ./)* ./ PAN/GIR NO. : AAFCA 4340 K ( (+ / // / APPELLANT ) .. ( ,-(+ / RESPONDENT ) AND CO NO.118/AHD/2010 A.Y. 2007-08 (ARISING OUT OF ITA NO.791/AHD/2010 A.Y. 2007-08 ) M/S.ASHOKA FASHIONS PVT.LTD. VS. ITO,WARD-1(1) , SURAT (CROSS OBJECTOR) .. (RESPONDENT) REVENUE BY : SHRI DINESHCHANDRA SHARMA SR.D.R. ASSESSEE BY : -NONE- &. / #/ // / DATE OF HEARING : 16/5/2012 01' / # / DATE OF PRONOUNCEMENT : 25/5/12 '2/ O R D E R PER SHRI MUKUL KR. SHRAWAT, JUDICIAL MEMBER : THIS IS AN APPEAL FILED BY THE REVENUE AND THE ASS ESSEE IS IN CROSS- OBJECTION ARISING FROM THE ORDER OF LD.CIT(A)-I, SU RAT DATED 28/01/2010. THE REVENUE HAS RAISED THE FOLLOWING GROUND:- 1) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND I N LAW, THE LD.CIT(A) HAS ERRED IN DELETING THE ADDITION MADE ON ACCOUNT OF UNEXPLAINED INVESTMENT IN LAND U/S.69B OF THE ACT OF RS.11,81,6 49/-. ITA NO.791/AHD/2010 (BY REVENUE) AND CO NO.118/AHD/2010 (BY ASSESSEE) ITO VS. M/S.ASHOKA FASHIONS PVT.LTD. ASST.YEAR - 2007-08 - 2 - 2. FACTS IN BRIEF AS EMERGED FROM THE CORRESPONDING ASSESSMENT ORDER PASSED U/S.143(3) OF THE I.T. ACT, 1961 DATED 15/ 12/2009 WERE THAT THE ASSESSEE-COMPANY HAD SHOWN AN ADDITION OF RS.2,62,3 81/- TO THE FIXED ASSET IN RESPECT OF LAND PURCHASED DURING THE YEAR. PERUSAL OF THE PURCHASE-DEED SHOWED THAT THE ASSESSEE HAD ENTERED INTO A DEED OF CONVEYANCE WITH SMT.CHANDALBEN T.MISTRY AND SHRI SU RESH T.MISTRY FOR A CONSIDERATION OF RS.5,03,079/- IN RESPECT OF PLOT NO.173/3, PANDESARA INDUSTRIAL ESTATE. IT WAS SEEN THAT THE ASSESSEE W AS REQUIRED TO PAY ADDITIONAL STAMP DUTY OF RS.43,019/- CORRESPONDING TO INCREASE IN VALUATION OF LAND BY RS.7,16,983/-. THE ASSESSEE P AID THE ADDITIONAL STAMP DUTY. IT WAS ALSO SEEN THAT THE ASSESSEE HAD ALSO ENTERED INTO A DEED OF CONVEYANCE WITH SMT.SAVITABEN HARILAL MISTR Y, SHRI HITENDRA HIRALAL MISTRY AND OTHERS FOR A CONSIDERATION OF RS .5,58,197/- IN RESPECT OF PLOT NO.171/2, PANDESARA INDUSTRIAL ESTATE. THE ASSESSEE WAS REQUIRED TO PAY ADDITIONAL STAMP DUTY OF RS.27,880/- CORRESP ONDING TO INCREASE IN VALUATION OF LAND BY RS.4,64,666/- WHICH WAS PAID B Y THE ASSESSEE. IN VIEW OF THE ABOVE, IT IS SEEN THAT THE ASSESSEE HAD PAID ADDITIONAL STAMP DUTY IN RESPECT OF INCREASE IN VALUATION OF LAND BY RS.11,81,649/- (RS.7,16,983 + RS.4,64,666). THE ASSESSING OFFICER , THEREFORE, ISSUED A SHOW-CAUSE NOTICE TO THE ASSESSEE AS TO WHY THE SAM E BE NOT ADDED AS UNEXPLAINED INVESTMENT. THE ASSESSEE STATED THAT T HE ADDITIONAL STAMP DUTY WAS PAID BY ASSESSEE-COMPANY FOR THE PURPOSE O F FULFILLING THE STIPULATIONS OF THE GOVERNMENT OF GUJARAT BUT IT DO ES NOT MEAN THAT THE ASSESSEE HAD PAID EXCESS AMOUNT. THE ASSESSING OFF ICER DID NOT ACCEPT THE ABOVE EXPLANATION AND STATED THAT THE VALUATION OF THE PROPERTY WAS ASSESSED AT HIGHER VALUE THAN MENTIONED IN THE DEED . THIS SHOWS THAT THE ITA NO.791/AHD/2010 (BY REVENUE) AND CO NO.118/AHD/2010 (BY ASSESSEE) ITO VS. M/S.ASHOKA FASHIONS PVT.LTD. ASST.YEAR - 2007-08 - 3 - VALUATION IN THE DEED WRONG BECAUSE THE ASSESSEE HA S ACCEPTED THE VALUATION MADE BY THE STAMP DUTY AUTHORITY. THE AS SESSING OFFICER, THEREFORE, MADE THE ADDITION U/S.69B AS UNEXPLAINED INVESTMENT IN THE LAND. 3. THE MATTER WAS CARRIED BEFORE THE LEARNED CIT(AP PEALS) WHO HAS DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE AS FOLL OWS:- 2.3. I HAVE CONSIDERED THE SUBMISSION MADE BY THE APPELLANT AND THE OBSERVATION OF THE A.O. THE FACTS IN THE CASE ARE NOT DISPUTED THAT THE PAYMENT WAS MADE IN RESPECT OF ADDITIONAL STAMP DUTY ON THE BASIS OF VALUATION OF LAND AS PER JANTRI VALUE. THE A.O. HAS STATED THAT THIS MEANS THAT THE ASSESSEE HAS MADE U NEXPLAINED INVESTMENT U/S.69B WHEREAS THE ASSESSEE HAS STATED THAT THE ADDITION U/S.69B CANNOT BE MADE UNLESS THE A.O. PRO VED THAT THE UNEXPLAINED INVESTMENT HAS BEEN MADE. HOWEVER, IN VIEW OF THE DECISION OF THE JURISDICTIONAL HONBLE ITAT, AHMEDA BAD IN THE CASE OF SHRI BHARATKUMAR N.PATEL, ITA NO.1749/AHD/2 008 DATED 29.08.2008 AND ALSO THE DECISION OF THE HONBLE ITA T, AHMEDABAD IN THE CASE OF BALKISHAN PODDAR, ITA NO.3412, 3413 & 3414/AHD/2008 DATED 12.06.2009, NO ADDITION CAN BE SUSTAINED BASED ON EITHER STAMP DUTY VALUATION OR THE VALUATI ON REPORT OF THE DVO. 4. ON THE DATE OF HEARING, AN ADJOURNMENT WAS MOVED FROM THE SIDE OF THE RESPONDENT-ASSESSEE, HOWEVER, WE HAVE HELD T HAT IT WAS UNWARRANTED DUE TO THE BREVITY OF THE MATTER AFTER PERUSING THE ORDERS OF THE AUTHORITIES BELOW. FROM THE SIDE OF THE REVENU E, LD.SR.DR MR.DINESHCHANDRA SHARMA APPEARED AND PLACED RELIANC E ON THE ORDER OF THE ASSESSING OFFICER. ITA NO.791/AHD/2010 (BY REVENUE) AND CO NO.118/AHD/2010 (BY ASSESSEE) ITO VS. M/S.ASHOKA FASHIONS PVT.LTD. ASST.YEAR - 2007-08 - 4 - 5. AT THE OUTSET, IT IS WORTH TO MENTION THAT THE P ROVISIONS OF SECTION 50C OF THE I.T.ACT ARE WHERE THE CONSIDERATION RECE IVED AS A RESULT OF THE TRANSFER BY AN ASSESSEE OF A CAPITAL ASSET AND THAT CONSIDERATION IS FOUND TO BE LESS THAN THE VALUE ADOPTED BY ANY OF A STATE GOVERNMENT FOR THE PURPOSE OF PAYMENT OF STAMP DUTY, THEN THE VALUE SO ADOPTED FOR STAMP PURPOSES SHALL BE DEEMED TO BE THE FULL VALUE OF TH E CONSIDERATION. MEANING THEREBY THE PROVISIONS OF SECTION 50C ARE T O BE ATTRACTED IN THE CASE WHEN AN ASSESSEE IS A TRANSFEROR, HENCE SELLIN G A PROPERTY AND RECEIVING A CONSIDERATION. ON THE CONTRARY, IN THE PRESENT CASE, THE ASSESSEE IS A PURCHASER OF THE PROPERTIES. NEXT IS THE QUESTION THAT APART FROM THE AMOUNT OF ADDITIONAL STAMP DUTY PAID BY TH E ASSESSEE WAS THERE ANY OTHER INFORMATION IN POSSESSION OF THE ASSESSIN G OFFICER ON THE BASIS OF WHICH HE HAD FORMED AN OPINION THAT THE ASSESSEE HAD MADE. AN UNDISCLOSED INVESTMENT TOWARDS PURCHASE OF THOSE PR OPERTIES TO BE TAXED BY INVOKING THE PROVISIONS OF SECTION 69-B OF THE I .T.ACT. THE APPELLANT HAD ARGUED THAT THE SAID ADDITIONAL STAMP DUTY WAS PAID SINCE IT WAS FOUND BY THE STAMP DUTY AUTHORITIES THAT THE JANTR I VALUE FIXED WAS HIGHER. FACTUALLY, THE ASSESSEE COULD NOT HAVE GOT THE REGISTRATION-DEED BACK UNLESS THIS ASSESSEE PAID THE SAID ADDITIONAL STAMP DUTY. AS FAR AS THE PAYMENT OF ADDITIONAL STAMP DUTY WAS CONCERNED, THE SAME WAS NOT IN DISPUTE. THE ASSESSEE HAS THUS VEHEMENTLY ARGUED T HAT NOTHING WAS PAID OVER AND ABOVE THE AMOUNTS DULY DISCLOSED. IN SUPP ORT, RELIANCE WAS PLACED ON THE FOLLOWING CASE LAWS:- SR.NO(S) IN THE CASE OF.. REPORTED IN.. 1. CIT VS. HARPAL SINGH [2008] 169 TAXMAN 90 [P&H] 2. CIT VS. NARESH KATTAR [2003]261 ITR 664 ITA NO.791/AHD/2010 (BY REVENUE) AND CO NO.118/AHD/2010 (BY ASSESSEE) ITO VS. M/S.ASHOKA FASHIONS PVT.LTD. ASST.YEAR - 2007-08 - 5 - (HUF) (DELHI) 3. SMT.AMAR KUMAR SURANA VS. CIT [1997] 226 ITR 344 (RAJ.) 5.1. WE HAVE ALSO FOUND THAT THE LD.CIT(A) HAS FOLL OWED FEW ORDERS OF THIS TRIBUNAL; NAMELY, (I) SHRI BHARATKUMAR N.PATE L (ITA NO.1749/AHD/2008) DATED 29.08.2008 AND (II) BALKISH AN PODDAR (ITA NOS.3412, 3413 & 3414/AHD/2008) DATED 12.06.2009. C ONSIDERING THE TOTALITY OF THE FACTS OF THE CASE AND RESPECTFULLY FOLLOWING THE VIEW EXPRESSED IN THE PRECEDENCE CITED HEREINABOVE, WE F IND NO FALLACY IN THE JUDGEMENT OF THE LEARNED CIT(APPEALS), HENCE HEREBY CONFIRMED. RESULTANTLY, THIS GROUND OF THE REVENUE IS DISMISSE D. ASSESSEES CROSS OBJECTION NO.118/AHD/2010 6. THE CROSS OBJECTION FILED BY THE ASSESSEE IS MER ELY IN SUPPORT OF THE DELETION OF ADDITION BY THE LD.CIT(A). SINCE W E HAVE ALREADY DISMISSED THE GROUND OF THE REVENUE, HENCE, THE CRO SS OBJECTION OF THE ASSESSEE HAS BECOME REDUNDANT. 7. IN THE RESULT, THE APPEAL OF THE REVENUE IS D ISMISSED AND THE CROSS OBJECTION FILED BY THE ASSESSEE IS HEREBY HEL D AS INFRUCTUOUS. SD/- SD/- ( .. ) ( ) '# ( T.R. MEENA ) ( MUKUL KR. SHRAWAT ) ACCOUNTANT MEMBER JUDICIAL ME MBER AHMEDABAD; DATED 25/ 5 /2012 ..&, .&../ T.C. NAIR, SR. PS ITA NO.791/AHD/2010 (BY REVENUE) AND CO NO.118/AHD/2010 (BY ASSESSEE) ITO VS. M/S.ASHOKA FASHIONS PVT.LTD. ASST.YEAR - 2007-08 - 6 - '2 / ,3 4'3' '2 / ,3 4'3' '2 / ,3 4'3' '2 / ,3 4'3'/ COPY OF THE ORDER FORWARDED TO : 1. (+ / THE APPELLANT 2. ,-(+ / THE RESPONDENT. 3. 5 / CONCERNED CIT 4. 5() / THE CIT(A)-I, SURAT 5. 389 ,& , , / DR, ITAT, AHMEDABAD 6. 9: ;. / GUARD FILE. '2& '2& '2& '2& / BY ORDER, -3 , //TRUE COPY// < <<