Moon Star Beach Resorts Private Limited, CHENNAI V. DCIT Corporate Circle 4(1), CHENNAI

ITA 893/CHNY/2019

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 0819 (ITAT-CHENNAI)
• Duration Of Justice: 3 year(s) 6 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-10-2022
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 27-09-2022
• Assessment Year: 2014-2015
• Appeal Filed On: 01-04-2019
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Sale consideration of property below Jantri Value; Valuation report; Capital Gains
• Section: 50C

Judgement Text

आयकर अपीलीय अिधकरण, ’सी’ Ɋायपीठ, चेɄई IN THE INCOME-TAX APPELLATE TRIBUNAL ‘C’ BENCH, CHENNAI ŵी वी दुगाŊ राव Ɋाियक सद˟ एवं ŵी जी. मंजुनाथा, लेखा सद˟ के समƗ Before Shri V. Durga Rao, Judicial Member & Shri G. Manjunatha, Accountant Member आयकर अपील सं./I.T.A. No. 893/Chny/2019 िनधाŊरण वषŊ/Assessment Year:2014-15 M/s. Moon Star Beach Resorts (P) Ltd., Flat No. 6, 14, Whannels Road, Egmore, Chennai 600 008. [PAN:AAECM2763M] Vs. The Deputy Commissioner of Income Tax, Corporate Circle 4(1) Chennai. (अपीलाथŎ/Appellant) (ŮȑथŎ/Respondent) अपीलाथŎ की ओर से / Appellant by : Shri N. Quadir Hoseyn, Advocate ŮȑथŎ की ओर से/Respondent by : Shri P. Sajit Kumar, JCIT सुनवाई की तारीख/ Date of hearing : 28.09.2022 घोषणा की तारीख /Date of Pronouncement : 14.10.2022 आदेश /O R D E R PER V. DURGA RAO, JUDICIAL MEMBER: This appeal filed by the assessee is directed against the order of the ld. Commissioner of Income Tax (Appeals) 8, Chennai, dated 30.01.2019 relevant to the assessment year 2014-15. 2. Facts are, in brief, that the assessee filed its return of income for the assessment year 2014-15 on 30.10.2015 admitting total income of ₹.75,83,510/-. The assessee has offered long term capital gains of ₹.85,27,750/- arising out sale of 5 grounds of land. The sale consideration I.T.A. No.893/Chny/19 2 received by the assessee was ₹.1,80,00,000/- and the Assessing Officer invoked section 50C of the Income Tax Act, 1961 [“Act” in short]. According to the Assessing Officer, as per section 50C of the Act, the value of the property is Rs. 3 crores and the same is considered for capital gains. According to the DVO value, the valuation of the property was ₹.2,52,14,400/-. The Assessing Officer adopted the same and accordingly calculated capital gains at ₹.1,57,42,150/- and brought to tax. On appeal, the ld. CIT(A) has considered the issue and held as under: “7. The submission of the assessee is considered. It is seen that the Government of Tamil Nadu had raised the guideline value several times between 2012 to 2017. The guideline value of the property sold was at Rs.750/- per sq.ft. as on 31.3.2012. This has been increased several times to Rs.3,000/- per sq.ft. from 1.4.2012 onwards. This steep and unreasonable increase in the guideline value rate had been modified from 9.6.2017 to Rs.2000/- per sq.ft. in the same area. As per the valuation report given by the Learned Valuation Officer, the valuation of 12,000 sq.ft. of land has been taken at an average value of Rs.2100/- per sq.ft. However, it is seen that the revised valuation applicable from 9.7.2017 has not been given credence to. The valuation officer appears to have allowed discount over the valuation initially taken at Rs.3000/ sq.ft. The value of the land was expected to marginally increase from year to year and not decrease over the years. The fixation of guideline value as above is a classic case of unscientific fixation of guideline value by the local authorities. Considering the arbitrariness in the valuation fixed and any possible harm to the assessee on account of such whimsical and arbitrary fixation of guideline value, the Assessing Officer is directed to take the value at Rs.2,000/- per sq.ft. for 12,000/- sq.ft. with a gross value of Rs.2,40,00,000/- for the entire property. The assessee gets partial relief and the grounds of appeal of the assessee are partially accepted.” 3. We have heard both the sides, perused the materials available on record and gone through the orders of authorities below. We find that the I.T.A. No.893/Chny/19 3 DVO has considered value of the property at ₹.2,100/- per sq.ft. and the ld. CIT(A) has considered the value of the property at ₹.2,000/- per sq.ft. and accordingly relief was granted. We find that after DVO valuation report also, the ld. CIT(A) has granted relief to the assessee. The assessee has not been able to point out any mistake in the order passed by the ld. CIT(A). Accordingly, the ground raised by the assessee is dismissed. 4. In the result, the appeal filed by the assessee is dismissed. Order pronounced on the 14 th October, 2022 in Chennai. Sd/- Sd/- (G. MANJUNATHA) ACCOUNTANT MEMBER (V. DURGA RAO) JUDICIAL MEMBER Chennai, Dated, 14.10.2022 Vm/- आदेश की Ůितिलिप अŤेिषत/Copy to: 1. अपीलाथŎ/Appellant, 2.ŮȑथŎ/ Respondent, 3. आयकर आयुƅ (अपील)/CIT(A), 4. आयकर आयुƅ/CIT, 5. िवभागीय Ůितिनिध/DR & 6. गाडŊ फाईल/GF.