ITO, Nagapattinam V. A.V.M.Nazimudeen, Koothanallur

ITA 837/CHNY/2013

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 4791 (ITAT-CHENNAI)
• Duration Of Justice: 3 year(s) 11 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-04-2017
• Appeal Filed By: Department
• Bench Allotted: B
• Next Hearing Date: 03-04-2017
• Assessment Year: 2004-2005
• Appeal Filed On: 02-05-2013
• Court: TRIBUNAL
• Keywords: Sale consideration of property below Jantri Value; Charitable institution; Valuation report; Condonation of delay
• Section: 143(3); 50C; 148; 263

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, CHENNAI , . , # $ BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SHRI G. PAVAN KUMAR, JUDICIAL MEMBER ./ I.T.A. NO. 831/MDS/2013 / ASSESSMENT YEAR : 2004-05 INCOME TAX OFFICER, WARD I(2), NAGAPATTINAM. VS . SHRI A.V.M. AHAMED KABIR, 20-B, GANDHI NAGAR, KOOTHANALLUR - 614 101. [PAN: AGCPA 3329C] ./ I.T.A. NO. 1596/MDS/2013 / ASSESSMENT YEAR : 2004-05 SHRI A.V.M. AHAMED KABIR, 20-B, GANDHI NAGAR, KOOTHANALLUR - 614 101. [PAN: AGCPA 3329C] VS. INCOME TAX OFFICER, WARD I(2), NAGAPATTINAM. ./ I.T.A. NO. 836/MDS/2013 / ASSESSMENT YEAR : 2004-05 INCOME TAX OFFICER, WARD I(2), NAGAPATTINAM. VS . LATE S.E.S.A. BALKEES AMMAL, REP. BY SHRI A..V.M. AHAMED KABEER, 5-A, GANDHI NAGER, KOOTHANALLUR - 614 101. [PAN: AAHPB 6371Q] ./ I.T.A. NO. 1594/MDS/2013 / ASSESSMENT YEAR : 2004-05 LATE S.E.S.A. BALKEES AMMAL, REP. BY SHRI A..V.M. AHAMED KABEER, 5-A, GANDHI NAGER, KOOTHANALLUR - 614 101. VS. INCOME TAX OFFICER, WARD I(2), NAGAPATTINAM. :-2-: I.T.A. NOS. 831, 836, 837, 838, 1594, 1595, 1596 & 1597/MDS/2013 [PAN: AAHPB 6371Q] ./ I.T.A. NO. 837/MDS/2013 / ASSESSMENT YEAR : 2004-05 INCOME TAX OFFICER, WARD I(2), NAGAPATTINAM. VS . SHRI A. V.M. NAZIMUDEEN, 5-A, GANDHI NAGER, KOOTHANALLUR - 614 101. [PAN: AADPN 5884A] ./ I.T.A. NO. 1597/MDS/2013 / ASSESSMENT YEAR : 2004-05 SHRI A.V.M. NAZIMUDEEN, 5-A, GANDHI NAGER, KOOTHANALLUR - 614 101. [PAN: AADPN 5884A] VS. INCOME TAX OFFICER, WARD I(2), NAGAPATTINAM. ./ I.T.A. NO. 838/MDS/2013 / ASSESSMENT YEAR : 2004-05 INCOME TAX OFFICER, WARD I(2), NAGAPATTINAM. VS . SHRI A..V.M. ZUBAIDA BEEVI 5-A, GANDHI NAGER, KOOTHANALLUR - 614 101. [PAN: AAEPZ 8675Q] ./ I.T.A. NO. 1595/MDS/2013 / ASSESSMENT YEAR : 2004-05 SHRI A..V.M. ZUBAIDA BEEVI 5-A, GANDHI NAGER, KOOTHANALLUR - 614 101. [PAN: AAEPZ 8675Q] VS. INCOME TAX OFFICER, WARD I(2), NAGAPATTINAM. ( / APPELLANT) ( /RESPONDENT) & ' / APPELLANT BY : SHRI M.M. BHUSARI, CIT *+& ' / RESPONDENT BY : SHRI NARENDRA KUMAR, ADVOCATE & SHRI N. DEVANATHAN, ADVOCATE :-3-: I.T.A. NOS. 831, 836, 837, 838, 1594, 1595, 1596 & 1597/MDS/2013 ' /DATE OF HEARING : 06.04.2017 ' /DATE OF PRONOUNCEMENT : 21.04.2017 /O R D E R PER G. PAVAN KUMAR, JUDICIAL MEMBER: THE FOUR CO-OWNERS ARE THE ASSESSEE'S WITH THE I NCOME TAX DEPARTMENT FILED THE APPEAL AGAINST THE DIFFERENT O RDERS PASSED BY THE COMMISSIONER OF INCOME TAX -II, THIRUCHIRAPPALLI DA TED 16.03.2011 FOR THE ASSESSMENT YEAR 2004-05. AND THERE WAS A DELAY IN FILING THE APPEAL AND THE CONDONATION PETITION WAS FILED. FOR THE SAKE OF CO NVENIENCE, WE TAKE UP THE APPEAL ITA NO. 1596/MDS/2013 FOR THE ASSESSMENT YEA R 2004-05. 2. THE APPEAL HAS FILED AN APPEAL BEFORE THE TRIBUN AL CHALLENGING THE REVISION ORDER U/S. 263 OF THE ACT. THE ASSESSEE HA S FILED AN APPLICATION FOR CONDONING THE DELAY IN FILING THE APPEAL ITA NO. 15 96/MDS/2013. 3. BEFORE GOING INTO THE MERITS OF THE ASSESSEE CAS E, THE LD. AR HAS ARGUED TO CONDONED THE DELAY OF 762 DAYS IN FILING THE APPEAL. WE HEARD BOTH THE PARTIES, THE LD AR EXPLAINED THAT THE ASSESSEE HAS FILED AN AFFIDAVIT FOR CONDONATION OF DELAY AND ADMISSION OF THE APPEAL. WE HAVE PERUSED THE CONDONATION PETITION FILED BY THE ASSESSEE. THE AS SESSEE HAS FILED AN AFFIDAVIT AND PRAYED FOR CONDONATION OF 762 DAYS WITHOUT EXPL AINING THE VALID REASONS FOR :-4-: I.T.A. NOS. 831, 836, 837, 838, 1594, 1595, 1596 & 1597/MDS/2013 DELAY IN FILING THE APPEAL. THE LD. AR COULD NOT E XPLAIN THE CIRCUMSTANCES IN WHICH THE APPEAL WAS FILED AND WE PRIMA FACIE FOUND , THERE IS INORDINATE DELAY IN FILING THE APPEAL AND THE EXPLANATIONS ARE NOT CONV INCING. WE ALSO FIND THAT THE DELAY CANNOT BE CONDONED WITHOUT SUFFICIENT CAUSE A ND VALID REASONS AND RELY ON THE CO-ORDINATE BENCH DECISION OF THIS TRIBUNAL IN THE CASE OF JCIT VS TRACTORS & FARM EQUIPMENTS LTD., 104 ITD 149, AT PAGE 150 WHER EIN IT WAS OBSERVED AS UNDER: ' A DISTINCTION MUST BE MADE BETWEEN A CASE WHERE THE DELAY IS INORDINATE AND A CASE WHERE THE DELAYS IS OF A FEW DAYS. WHEREAS IN THE FORMER CASE, THE CONSIDERATION OF PREJUDICE TO THE OTHER SIDE WILL BE A RELEVANT FACTOR, SO THE CASE CALLS FOR A MORE CAUTI OUS APPROACH, IN THE LATTER CASE, NO SUCH CONSIDERATION MAY ARISE AND SU CH A CASE DESERVES A LIBERAL APPROACH. NO HARD AND FAST RULE CAN BE LAID DOWN IN THIS REGARD. THE COURT HAS TO EXERCISE THE DISCRETION ON THE FAC TS OF EACH CASE, KEEPING IN MIND THAT IN CONSIDERING THE EXPRESSION SUFFICI ENT CAUSE THE PRINCIPLE OF ADVANCING SUBSTANTIAL JUSTICE IS OF PRIME IMPORTANC E. THE LAW ASSISTS THOSE WHO ARE VIGILANT, NOT THOSE WHO SLEEP OVER THEIR RIGHTS. THIS PRINCIPLE IS EMBODIED IN THE DIC TUM: VIGILANTIBUS NON DOEMIENTIBUS JURA SUBVENIUNT. THE DELAY CANNOT BE CONDONED SIMPLY BECAUSE THE AP PELLANTS CASE IS HARD AND CALLS FOR SYMPATHY OR MERELY OUT OF BEN EVOLENCE TO THE PARTY SEEKING RELIEF. IN GRANTING THE INDULGENCE AND COND ONING THE DELAY, IT MUST BE PROVED BEYOND THE SHADOW OF DOUBT THAT THE APPEL LANT WAS DILIGENT AND WAS NOT GUILTY OF NEGLIGENCE, WHATSOEVER. THE SUFFI CIENT CAUSE WITHIN THE CONTEMPLATION OF THE LIMITATION PROVISIONS MUST BE A CAUSE WHICH IS BEYOND THE CONTROL OF THE PARTY INVOKING THE AID OF THE PR OVISIONS. THE CAUSE FOR THE DELAY IN FILING THE APPEAL, WHICH BY DUE CARE A ND ATTENTION, COULD HAVE BEEN AVOIDED, CANNOT BE A SUFFICIENT CAUSE WITHIN T HE MEANING OF THE LIMITATION PROVISION. WHERE NO NEGLIGENCE OR INACTI ON, OR WANT OF BONAFIDES CAN BE IMPUTED TO THE APPELLANT, A LIBERAL CONSTRUC TION OF THE PROVISIONS HAS TO BE MADE IN ORDER TO ADVANCE SUBSTANTIAL JUST ICE. SEEKERS OF JUSTICE MUST COME WITH CLEAN HANDS.' :-5-: I.T.A. NOS. 831, 836, 837, 838, 1594, 1595, 1596 & 1597/MDS/2013 AND THE CASES REFERRED: 1. BAJAJ HINDUSTHAN LTD. VS. JT. CIT (2005) 92 TTJ (MU MBAI) 1064 2. CIT VS. K.S.P. SHANMUGAVEL NADAR & ORS. (1985) 46 C TR (MAD) 156: (1985) 153 ITR 596 (MAD) 3. CIT VS. RAM MOHAN KABRA (2002) 178 CTR (P&H) 274 4. CIT VS. SHRI GANAPATHY MILLS COMPANY LTD. (2000) 24 3 ITR 879 (MAD) 5. CIT VS. SUNDARAM FASTENERS LTD. (2005) 194 CTR (MAD ) 339: (2005) 272 ITR 652 (MAD) 6. CIT VS WHEELS INDIA LTD. (2005) 197 CTR (MAD) 284: (2005) 275 ITR 319 (MAD) 7. COLLECTOR, LAND ACQUISITION VS. MST. KATIJI & ORS. (1987) 62 CTR (SC) 23: (1987) 167 ITR 471 (SC) 8. GANGA SAHAI RAM SWARUP & ANR. VS. ITAT & ORS. (2004 ) 271(1)(C) ITR 512 (ALL) 9. PEOPLE EDUCATION AND ECONOMIC DEVELOPMENT SOCIETY ( PEEDS) VS. ITO (2006) 104 TTJ (CHENNAI) (TM) 467 10. SREENIVAS CHARITABLE TRUST VS. DY. CT (2006) 280 I TR 357 (MAD) 11. VENKATADRI TRADERS LTD., VS. CIT (2001) 168 CTR (MA D)81: (2001) 118 TAXMAN 622 (MAD) 4. CONSIDERING THE FACTS, JUDICIAL DECISIONS AND EX PLANATIONS OF THE ASSESSEE, WE ARE OF THE OPINION THAT THE CONDONATIO N PETITION FILED BY THE ASSESSEE IS WITHOUT SUFFICIENT CAUSE AND THERE SEEM S TO BE NEGLIGENCE ON THE PART OF THE ASSESSEE AND NO PRIORITY WAS FIXED AND SUCH LAPSES CANNOT BE CONDONED AND WE DECLINE TO CONDONE THE DELAY IN FIL ING THE APPEAL AND ACCORDINGLY THE APPEAL IS DISMISSED AS UNADMITTED. SIMILARLY THE THREE CO-OWNERS FILED THE APPEAL IN ITA NO. 1594, 1595 & 1597/MDS/2 013, WHERE THE FACTS ARE :-6-: I.T.A. NOS. 831, 836, 837, 838, 1594, 1595, 1596 & 1597/MDS/2013 IDENTICAL AND SIMILAR TO ITA NO. 1596/MDS/2013AND A CCORDINGLY THESE APPEALS ARE ALSO DISMISSED AS UNADMITTED. IN THE RESULT, ASSESSEE APPEALS IN ITA NOS. 1596/M DS/2013, 1597/MDS/2013, 1595/MDS/2013 & 1594/MDS/2013 ARE DI SMISSED. 5. THE REVENUE HAS FILED APPEALS AGAINST THE COMMON ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) IN ITA NO. 289 , 292, 288 291/11-12 PASSED U/S. 143 R.W.S. 263 AND 250 OF THE INCOME TA X ACT. FOR THE SAKE OF CONVENIENCE, WE TAKE UP THE REVENUE APPEAL FILED IN ITA NO. 831/MDS/2013 FOR THE ASSESSMENT YEAR 2004-05 AND THE FACTS NARRATED THEREIN. 5.1 THE REVENUE HAS RAISED THE FOLLOWING GROUNDS: 2. THE LD. CIT(A) ERRED IN DIRECTING THE ASSESSING OFFICER TO ALLOW RS. 70,00,00/- AS COMPENSATION INSTEAD OF RS. 50,00,000 /- TO M/S. OPAL CONSTRUCTIONS. 2.1 THE LD. CIT(A) ERRED IN ADMITTING WRITTEN SUBMI SSIONS GIVEN BY THE ASSESSEE'S REPRESENTATIVE AND HOLDING THAT RS. 70,0 0,000/- IS TO BE ALLOWED TOWARDS COMPENSATION TO M/S. OPAL CONSTRUCT ION WHICH IS CONTRARY TO THE CLAIM MADE BY THE ASSESSEE BEFORE T HE ASSESSING OFFICER. 2.2 THE LD. CIT(A) ERRED IN ACCEPTING FRESH CLAIMS MADE BY THE ASSESSEE WHICH WERE NOT CLAIMED IN THE RETURN OF INCOME FILE D ON 31.03.2008. :-7-: I.T.A. NOS. 831, 836, 837, 838, 1594, 1595, 1596 & 1597/MDS/2013 2.3 THE LD. CIT(A) FAILED TO NOTICE THAT THE ASSESS EE HIMSELF, HAD CLAIMED RS. 50,00,000/- ONLY IN THE RETURN OF INCOME FILED ON 31.03.2008 TOWARDS COMPENSATION PAID TO M/S. OPAL CONSTRUCTION . 2.4 THE LD CIT(A) ERRED IN ACCEPTING THE FRESH CLAI MS OF THE ASSESSEE WITHOUT GIVING THE ASSESSING OFFICER A REASONABLE O PPORTUNITY OF EXAMINING AND REBUTTING THE SAME, AS PER RULE 46A O F THE INCOME TAX RULES, 1962. 2.5 THE LD. CIT(A) FAILED TO NOTICE THAT A SUM OF R S. 15,00,000/- OUT OF THE RS. 70,00,000/- WAS REFUNDABLE SECURITY DEPOSIT, RE PAYABLE TO THE ASSESSEE UPON COMPLETION OF THE PROJECT (AS PER CLA USE 15 IN PAGE 6 OF THE MEMORANDUM OF UNDERSTANDING EXECUTED BY ASSESSE E AND THE OTHER THREE CO-OWNERS OF THE PROPERTY ON 17.05.2003 ) AND HENCE WAS NOT ALLOWABLE EXPENDITURE. 3. THE LD. CIT(A) ERRED IN DIRECTING THE ASSESSING OFFICER TO WORK OUT APPROPRIATE COST OF INDEXATION OF THE OLD BUILDING ON PAR WITH INDEXED VALUE OF THE LAND. 3.1 THE LD CIT(A) FAILED TO NOTICE THAT THE BUILDIN G WAS DEMOLISHED IN THE FINANCIAL YEAR 2000-01 ITSELF WHEREAS THE TRANSFER OF THE PROPERTY TOOK PLACE IN THE FINANCIAL YEAR 2003-04 ONLY. 3.2 THE LD. CIT(A) ERRED IN DIRECTING TO WORK OUT A PPROPRIATE COST OF INDEXATION OF THE NON-EXISTENT BUILDING. 3.3 THE LD. CIT(A) FAILED TO NOTICE THAT AN AMOUNT OF RS. 50,00,000/- WAS ALREADY ALLOWED AS EXPENDITURE TOWARDS DEVELOPMENT OF THE PROPERTY :-8-: I.T.A. NOS. 831, 836, 837, 838, 1594, 1595, 1596 & 1597/MDS/2013 BY M/S. OPAL CONSTRUCTION AND THEREFORE CANNOT BE A LLOWED ONCE AGAIN AS INDEXED COST OF BUILDING. 6. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESS EE IS AN INDIVIDUAL AND CO-OWNER OF THE PROPERTY AND FILED THE RETURN OF IN COME FOR THE ASSESSMENT YEAR 2004-05 ON 31.03.2008, DISCLOSING INCOME FROM CAPIT AL GAINS AND OTHER SOURCES. SINCE, THE RETURN OF INCOME WAS FILED BELATEDLY, TH E ASSESSING OFFICER ISSUED NOTICE U/S. 148 OF THE ACT AS INCOME HAS ESCAPED AS SESSMENT AND THE ASSESSMENT WAS COMPLETED U/S. 143(3) R.W.S. 147 OF THE ACT ON 29.12.2008 WITH ASSESSED INCOME OF RS. 64,08,990/-. SUBSEQUENTLY, THE COMMISSIONER OF INCOME TAX -II, THIRUCHIRAPPALI FOUND THE ORDER PASSED U/S . 143(3) R.W.S. 147 OF THE ACT ON 29.12.2008 IS ERRONEOUS AND PREJUDICAL TO THE IN TEREST OF THE REVENUE AND PASSED THE ORDER U/S. 263 OF THE ACT DATED 16.03.20 11 SET ASIDE THEORDER OF ASSESSING OFFICER. THE LD. AO AS PER THE DIRECTION S OF THE COMMISSIONER OF INCOME TAX ISSUED NOTICE U/S. 143(2) OF THE ACT ON 02.06.2011 AND IN RESPONSE TO NOTICE, THE LD. AR OF THE ASSESSEE APPEARED FROM TI ME TO TIME AND SUBMITTED THE INFORMATION ALONG WITH BOOKS OF ACCOUNTS. THE ASSE SSEE ALONG WITH HIS MOTHER SMT. SESA BALKEES AMMAL, BROTHER SHRI AVM NAZIMUDDI N AND SISTER AVM ZUBAIDA BEEVI, ENTERED INTO AN AGREEMENT OF DEVELOPMENT OF THE PROPERTY IN JULY 2002 WITH M/S. OPAL CONSTRUCTIONS. SINCE, THE PROPERTY DEVELOPMENT PROJECT COULD NOT MATERIALISE, THE ASSESSEE ALONG WITH THREE CO-OWNER PAID COMPENSATION OF RS. 50 LAKHS TO M/S. OPAL CONSTRUCTIONS TO RELINQUISH THE RIGHT IN THE PROPERTY DEVELOPMENT. SUBSEQUENT TO THE PAYMENT OF COMPENSA TION THE ASSESSEE AND CO- :-9-: I.T.A. NOS. 831, 836, 837, 838, 1594, 1595, 1596 & 1597/MDS/2013 OWMERS ENTERED INTO A JOINT DEVELOPMENT AGREEMENT W ITH M/S. ALLIANCE INDUSTRIES PVT. LTD., WHERE THE DEVELOPER HAS CONSTRUCTED THE MULTI-STORED BUILDING AND SHARED THE AREA IN THE RATIO OF 56% TO OWNERS AND 4 4% TO DEVELOPER, AND THE ASSESSEE OFFERED THE LONG TERM CAPITAL GAINS BASED ON THE 56% OF VALUE BUILDING IN THE RETURN OF INCOME AS UNDER: SALE CONSIDERATION OF 56% OF 8 GROUNDS AND 1621 SQ.FT. OF LAND ON 20.05.2003 RS. 2,97 ,00,000 LESS: EXPENSES ON SALE AMOUNT PAID AS COMPENSATION TO OPAL CONSTRUCTION, CHENNAI RS. 50,00,0 00 RS. 2,47,00,000 LESS: INDEXED VALUE OF THE ENTIRE PROPERTY AS ON 01.04.81 AS PER VALUER'S REPORT (8GR 1621 SF) RS. 30.4 LAKHS. 50% OF 30.4 LAKHS = 17 LAKHS INDEXED AT 4.63 TIMES RS. 78,71,000 RS. 1,68,29,000 7. THE ASSESSING OFFICER FOUND THAT THE COMMISSIONE R OF INCOME TAX -II, THIRUCHIRAPALLI, BY HIS ORDER DATED 16.03.2011 HAS DIRECTED THAT THE LAND SOLD BY THE CO-OWNERS HAS NO BUILDING, AND WHEREAS THE INDE X COST OF BUILDING WAS ALLOWED TO THE EXTENT OF RS. 65,31,471/- WHICH HAS TO BE VERIFIED AND ALSO TO VERIFY THE GENUINENESS OF RS 50 LAKHS PAID TO EARLI ER DEVELOPER M/S. OPAL CONSTRUCTIONS. THE LD. AO FOUND THAT HIBBAH DOCUME NT WAS EXECUTED ON 02.05.2003 BETWEEN THE CO-OWNERS AND THE DOCUMENT D OES NOT SPECIFY EXISTENCE OF THE OLD BUILDING. THE LD. AR SUPPORTED WITH THE LETTER FROM THE DEVELOPER OF EXISTENCE OF THE OLD BUILDING AT DOOR NO. 117, T. N AGAR, CHENNAI ALSO REFERRED TO :-10-: I.T.A. NOS. 831, 836, 837, 838, 1594, 1595, 1596 & 1597/MDS/2013 THE GENERAL POWER OF ATTORNEY DATED 20.05.2003 EXEC UTED BY THE PARTNER OF DEVELOPER IN SUPPORT OF EXISTENCE OF OLD BUILDING. BUT THE LD. AO IS OF THE OPINION THAT IF THERE HAS BEEN A OLD BUILDING AND SAME WAS NOT IN GOOD CONDITION THEREFORE, IN HIBBAH DOCUMENT, THERE IS NO MENTION OF OLD BUILDING. THE LD. AO IS OF THE OPINION THAT VALUE WAS INCLUDED TO CLAIM THE EXPENSES FOR DEMOLITION OF BUILDING BY ALL THE CO-OWNERS AND THE DOCUMENTS CAN NOT BE CONSIDERED AND WERE REJECTED. THE LD. AO WAS SATISFIED WITH MATERIAL O N RECORD FOR PAYMENT OF RS. 50 LAKHS TO OPAL CONSTRUCTIONS IN CONNECTION WITH LAN D PROMOTION. FURTHER, THE LD. AO APPLIED THE PROVISIONS OF SECTION 50C OF THE ACT AND ALSO RESTRICTED THE INDEX VALUE OF LAND TO RS. 13,49,645/- AND ASSESSED THE L ONG TERM CAPITAL GAINS OF RS. 2,92,59,995/- AND SHARE OF THE ASSESSEE IS DETERMIN ED AT RS. 82,83,357/- AND THE LD. AO PASSED THE ORDER U/S. 143 R.W.S. 263 OF THE ACT DATED 22.12.2011. 8. AGGRIEVED BY THE ORDER, THE ASSESSEE HAS FILED A N APPEAL WITH THE CIT(A). IN THE APPELLATE PROCEEDINGS, THE LD. AR M ADE SUBMISSIONS ON THE EVIDENCES AND HIBBAH DOCUMENTS AND FURTHER THE LD. AO ERRED IN DETERMINING THE SALE CONSIDERATION AS PER THE PROVISIONS OF SEC TION 50C OF THE ACT, THE LD CIT(A) CONSIDERED THE GROUNDS, SUBMISSIONS OF THE A SSESSEE AND THE EVIDENCE FILED ON THE DISPUTED ISSUE FOR COMPLYING THE PROVI SIONS OF SECTION 50C OF THE ACT. THE LD. CIT(A) DISCUSSED ELABORATELY AT PAGE 2 TO 9 OF THE ORDER AND CONCLUDED THAT THE ASSESSING OFFICER HAS COMPLETED RE-ASSESSM ENT ON 29.12.2008. WHEREAS, THE AMENDMENT TO SEC. 50C OF THE ACT WAS I NTRODUCED BY THE FINANCE ACT W.E.F. 01.10.2009 AND SHALL APPLY ONLY TO THE T RANSACTIONS TOOK PLACE ON OR :-11-: I.T.A. NOS. 831, 836, 837, 838, 1594, 1595, 1596 & 1597/MDS/2013 AFTER 01.10.2009. THEREFORE, LD. CIT(A) DIRECTED T HE ASSESSING OFFICER TO RE- COMPUTE THE CAPITAL GAINS ON THE BASIS OF ACTUAL CO ST RS. 2,97,00,000/- INSTEAD OF RS. 3,56,09,640/- AND ALLOWED THE GROUND OF THE ASS ESSEE. 8.1 IN RESPECT OF FIRST DISPUTED ISSUE OF PAYMENT O F COMPENSATION TO M/S. OPAL CONSTRUCTIONS, THE LD. CIT(A) CONSIDERED THE W RITTEN SUBMISSIONS AT PARA 23 OF THE ORDER AND REFERRED TO THE MEMORANDUM OF UNDE RSTANDING ENTERED ON 17.05.2003. THE LD. CIT(A) CONSIDERED THE ADDITION AL INFORMATION FILED IN THE APPELLATE PROCEEDINGS AND CONSIDERED THE CHEQUE PAY MENTS AND DETAILS SUPPORTING THE AGREEMENT. THE LD. CIT(A) HAVING SA TISFIED WITH THE PAYMENT OF COMPENSATION AND DIRECTED THE ASSESSING OFFICER TO ALLOW RS. 70 LAKHS AS COMPENSATION INSTEAD OF RS. 50 LAKHS CLAIMED IN THE RETURN OF INCOME AND ALLOWED THE ASSESSEE'S GROUND. 8.2 THE SECOND DISPUTED ISSUE WITH RESPECT OF EXPEN SES OF DEMOLITION OF BUILDING, THE LD. CIT(A) FOUND THAT THE ASSESSING O FFICER HAS RELIED ONLY ON THE ACTUAL VALUE OF THE LAND AND ALLOWED COST INFLATION INDEXATION BENEFIT. BUT THE FACT REMAINS THERE EXISTS A BUILDING AS SUPPORTED B Y THE DOCUMENTS AND PAPER BOOK, MEMORANDUM OF UNDERSTANDING AND GPA EXECUTED BY THE CO-OWNERS. THE LD. CIT(A) RELIED ON THE DOCUMENTS AND EVIDENCE AS THE ASSESSING OFFICER WAS NOT JUSTIFIED IN DENYING THE COST OF INDEXATION ON OLD BUILDING AND THE ASSESSEE ALSO FAILS TO SUBMIT THE INFORMATION IN RESPECT OF CONSTRUCTED AREA IN SQ.FT. OF A BUILDING. THE LD. CIT(A) OBSERVED THAT THERE EXIST S AN OLD BUILDING AS ON :-12-: I.T.A. NOS. 831, 836, 837, 838, 1594, 1595, 1596 & 1597/MDS/2013 01.04.1981 AND DIRECTED THE ASSESSING OFFICER TO WO RKED OUT THE COST OF INDEXATION WITH RESPECT TO VALUE OF LAND AND BUILDI NG AND ALLOWED THE GROUND OF THE ASSESSEE AND FINALLY LD. CIT(A) HAS PARTLY ALLO WED THE APPEAL. 9. AGGRIEVED BY THE ORDER OF THE CIT(A), REVENUE HA S FILED AN APPEAL BEFORE THE TRIBUNAL. BEFORE US, THE LD. DR ARGUED THAT THE CIT(A) HAS ERRED IN DIRECTING THE ASSESSING OFFICER TO ALLOW THE DEDUCT ION OF RS. 70 LAKHS AS COMPENSATION INSTEAD OF RS. 50 LAKHS CLAIMED BY THE ASSESSEE IN RESPECT OF OPAL CONSTRUCTIONS AND ALSO THE ASSESSEE HAS MADE FRESH CLAIM IN THE APPELLATE PROCEEDINGS AND PRAYED FOR SET ASIDE OF THE ORDER O F THE CIT(A). CONTRA, THE LD. AR RELIED ON THE ORDERS OF THE CIT(A) AND SUBSTANTI ATED HIS ARGUMENTS WITH SUBMISSIONS ON THE PAPER BOOK AND JUDICIAL DECISION S. 10. WE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MAT ERIAL ON RECORD AND JUDICIAL DECISIONS. THE FACT THAT THE ASSESSEE IS ONE OF THE CO-OWNER AND THE CO- OWNERS CLAIMED DEDUCTION OF RS. 50 LAKHS PAID AS CO MPENSATION TO M/S. OPAL CONSTRUCTIONS. WE PERUSED THE DOCUMENTS AND MATERI AL IN SUPPORT OF PAYMENT OF RS. 70 LAKHS AT PAGE 163 OF PAPER BOOK. WHERE I T WAS STATED IN THE JOINT DEVELOPMENT AGREEMENT EXECUTED ON 20.05.2003 BETWEE N THE ASSESSEE AND OTHER CO-OWNERS AND ALLIED MAJESTIC DEVELOPERS CONF IRMING THAT THE OPAL CONSTRUCTIONS, AT THE TIME OF EXECUTION OF DEVELOPM ENT AGREEMENT PAID SUM OF RS. 20 LAKHS TO THE CO-OWNERS AND AFTER THE DISCUSS IONS AND ARRANGEMENTS BETWEEN THE CO-OWNERS AND ERSTWHILE DEVELOPER OPAL CONSTRUCTIONS THE PRESENT :-13-: I.T.A. NOS. 831, 836, 837, 838, 1594, 1595, 1596 & 1597/MDS/2013 DEVELOPER ALLIED MAJESTIC MADE ARRANGEMENT FOR PAYM ENT REFERRED AT PAGE 163 AND INNER PAGE 3 OF THE MEMORANDUM OF UNDERSTANDING THAT OUT OF RS. 70 LAKHS (RS. 20 LAKHS PERTAINS TO INITIAL PAYMENT PLUS A CO MPENSATION OF RS. 50 LAKHS) WAS PAID AS THE FULL AND FINAL SETTLEMENT TOWARDS D UES. WE FOUND THE ASSESSEE HAS CLAIMED IN THE RETURN OF INCOME FILED FOR THE A SSESSMENT YEAR 2004-05 COMPENSATION OF RS. 50 LAKHS PAID TO OPAL CONSTRUCT IONS AND SUBSEQUENTLY IN THE ORDER PASSED U/S. 143(3) R.W.S. 263 OF THE ACT. TH E LD. AO ALLOWED THE COMPENSATION CLAIM OF RS. 50 LAKHS ONLY, BUT BEFORE THE LD. CIT(A), ASSESSEE MADE FRESH CLAIM OF RS. 20 LAKHS, WHICH IS NOT ALLO WABLE AFTER PASSING THE ASSESSMENT ORDER U/S. 143(3) R.W.S. 263 OF THE ACT IN CONFIRMITY WITH REVISION ORDER. HENCE, WE ARE OF THE OPINION THAT LD. CIT(A ) WAS NOT JUSTIFIED IN DIRECTING ADDITIONAL CLAIM OF RS. 20 LAKHS BASED ON THE FRESH CLAIM BY THE ASSESSEE. THE PROVISIONS OF SECTION 263 OF THE ACT IS FOR THE BEN EFIT OF REVENUE AND NOT FOR ASSESSEE. ACCORDINGLY, WE ARE INCLINED TO SET ASID E THE ORDER OF CIT(A) ON THIS GROUND AND RESTORE THE ORDER OF ASSESSING OFFICER A LLOWING THE CLAIM OF RS. 50 LAKHS ONLY AND ALLOW THIS GROUND OF THE APPEAL OF T HE REVENUE. 11. ON THE SECOND DISPUTED ISSUE THAT THE CIT(A) HA S ERRED IN DIRECTING THE ASSESSING OFFICER TO WORK OUT THE APPROPRIATE COST OF INDEXATION OF OLD BUILDING, ON PAR WITH INDEX VALUE OF LAND. THE LD. DR SUBMIT TED THAT THE CIT(A) HAS ERRED IN THE FACTS THAT THE BUILDING WAS DEMOLISHED IN TH E YEAR 2000-01 AND THE TRANSFER OF PROPERTY TOOK PLACE IN THE YEAR 2003-04 AND PRAYED FOR SETTING ASIDE THE ORDER OF CIT(A). WHEREAS, THE LD. AR RELIED ON THE ORDER OF THE CIT(A) AND :-14-: I.T.A. NOS. 831, 836, 837, 838, 1594, 1595, 1596 & 1597/MDS/2013 SUBSTANTIATED WITH PAPER BOOKS SUPPORTING THE EXIST ENCE OF BUILDING AND THE MEMORANDUM OF UNDERSTANDING AND POWER OF ATTORNEY A ND PRAYED FOR DISMISSAL OF REVENUE APPEAL. 12. WE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MAT ERIAL ON RECORD AND JUDICIAL DECISIONS. THE SOLE CRUX OF THE ISSUE THA T THE LD. CIT(A) HAS DIRECTED THE ASSESSING OFFICER TO WORKOUT THE APPROPRIATE COST O F INDEXATION OF THE OLD BUILDING. THE LD. AR DREW OUR ATTENTION TO THE SAL E DEED DOCUMENTS AT PAGE 1 TO 144 OF THE PAPER BOOK AND EXPLAINED THE SCHEDULE OF PROPERTY IN ONE, THE DOCUMENT AT PAGE 81. WHERE, THE EXPLANATIONS BEING THE LAND ALONG WITH SUPER STRUCTURE WAS PURCHASED BY THE CO-OWNERS FOR CONSTR UCTION AND ALSO SUPPORTED WITH DOCUMENTS EXPLAINING THE NATURE OF THE LAND. THE LD. AR EMPHASIZED ON THE MEMORANDUM OF UNDERSTANDING REFERRED AT PAGE 19 3, WHERE THE FACT OF EXISTENCE OF OLD BUILDING IN DOOR NO. 117, T.NAGAR, CHENNAI SUBSTANTIATED. SIMILARLY, IN THE REGISTERED GENERAL POWER OF ATTOR NEY AT PAGE 203 WHICH WAS EXECUTED ON 20.05.2003 IN FAVOUR OF PARTNERS OF CON STRUCTION FIRM M/S. ALLIED MAJESTIC SUPPORTING THE OLD BUILDING. THE LD. AR D REW OUR ATTENTION TO THE BUILDING DEMOLISHING EVIDENCE AND SUBMITTED THAT AF TER OBTAINING PERMISSION ON 01.03.2001, THE ASSESSEE HAS DEMOLISHED THE BUILDIN G AND ENTERED INTO A DEVELOPMENT AGREEMENT WITH BUILDER. NOW, THE QUEST ION ARISES ON DETERMINING THE VALUE OF OLD BUILDING EXISTENCE AS ON 01.03.200 1. ON THE QUERY FROM THE BENCH THE LD AR COULD NOT CONVINCE WITH RESPECT TO EXISTENCE OF BUILDING WITH :-15-: I.T.A. NOS. 831, 836, 837, 838, 1594, 1595, 1596 & 1597/MDS/2013 ANY PROOF OR VALUE OR VALUATION REPORT TO SUPPORT T HEIR CLAIM AND RELIED ONLY ON THE DOCUMENTS. 13. WE PERUSED THE VARIOUS DOCUMENTS AS REFERRED B Y THE LD. AR THERE SEEMS TO BE A BUILDING EXISTING RIGHT FROM THE PURC HASE OF THE PROPERTY FROM THE YEAR 1997 TO THE YEAR 2001 AND THE FACT BEING THAT THE BUILDING WAS UNDER EXISTENCE. NOW THE QUESTION ARISES THE ASSESSEE HA S CLAIMED INDEXATION ON THE VALUE OF BUILDING AS PER THE VALUER REPORT. WE FIN D THE ASSESSING OFFICER HAS NOT REFERRED TO THE VALUATION REPORT AND MADE OBSERVATI ONS ONLY ON HIBBAH DOCUMENT EXECUTED ON 02.05.2003 BETWEEN CO-OWNERS, WHERE THE SE FACTS OF THE OLD BUILDING WAS NOT MENTIONED. PRIMA FACIE, ON PERUSA L OF THE SUPPORTIVE DOCUMENTS THERE WAS EXISTENCE OF BUILDING BUT THE V ALUE WAS NOT DETERMINED. EVEN THE VALUATION REPORT WAS NOT PRODUCED BEFORE U S BY THE LD. AR. WE CONSIDERING THE APPARENT FACTS, MATERIAL ON RECORD ARE OF THE OPINION THAT THE ASSESSEE SHOULD GET THE BENEFIT OF EXISTENCE OF BUI LDING AND ARE OF THE OPINION THAT THE REASONABLE AMOUNT SHOULD BE QUANTIFIED BAS ED ON THE LOCATION OF THE PROPERTY AND THE COMMERCIAL INFRASTRUCTURE AVAILABL E IN THE AREA. WE FIND THE LD. CIT(A) HAS DIRECTED THE ASSESSING OFFICER TO WORKOU T THE APPROPRIATE COST WHICH WE CONSIDER IT AS REASONABLE AS THE ASSESSEE SUBSTA NTIATED WITH EVIDENCE OF BUILDING TILL YEAR 2001. ACCORDINGLY, WE ARE NOT I NCLINED TO INTERFERE WITH THE ORDER OF THE CIT(A) ON THE DISPUTED ISSUE OF DIRECT ING THE ASSESSING OFFICER TO WORKOUT THE APPROPRIATE COST OF INDEXATION ON OLD B UILDING AND UPHELD THE ACTION :-16-: I.T.A. NOS. 831, 836, 837, 838, 1594, 1595, 1596 & 1597/MDS/2013 OF CIT(A) AND DISMISS THE REVENUE GROUND. IN THE R ESULT, REVENUE APPEAL IN ITA NO. 831/MDS/2013 IS PARTLY ALLOWED. 13.1 SIMILARLY, REVENUE APPEALS IN ITA NOS. 836, 83 7, 838/MDS/2013 ARE ALSO PARTLY ALLOWED FOR STATISTICAL PURPOSE. 14. IN THE RESULT, ASSESSEE APPEALS IN ITA NOS. 1 596/MDS/2013, 1597/MDS/2013, 1595/MDS/2013 & 1594/MDS/2013 ARE DI SMISSED AND REVENUE APPEALS IN ITA NO. 831/MDS/2013, 836/MDS/2013, 837/ MDS/2013 & 838/MDS/2013 ARE PARTLY ALLOWED FOR STATISTICAL PUR POSE. ORDER PRONOUNCED ON FRIDAY, THE 21ST DAY OF APRIL, 2017 AT CHENNAI. SD/- ( ) (CHANDRA POOJARI) / ACCOUNTANT MEMBER SD/- . ) (G. PAVAN KUMAR) /JUDICIAL MEMBER /CHENNAI, 0 /DATED: 21ST APRIL, 2017. JPV ' *#23 43 /COPY TO: 1. &/ APPELLANT 2. *+& /RESPONDENT 3. 5 ( )/CIT(A) 4. 5 /CIT 5. 3 *## /DR 6. 9 /GF