SMT. SANGITA JAIN, Indore V. THE ITO -4(3), Indore

ITA 91/IND/2016

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 5824 (ITAT-INDORE)
• Duration Of Justice: 5 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-07-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 21-06-2016
• Assessment Year: 2011-2012
• Appeal Filed On: 25-01-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MOHD JAVED
• Assessee Lawyers: S N AGRAWAL
• Keywords: Cost of acquisition

Judgement Text

SMT. SANGITA JAIN ITA NO./IND/2016 1 IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, INDORE BEFORE SHRI D.T. GARASIA, HONBLE JUDICIAL MEMBER ITA NO. 91/IND/2016 A.Y.2011-12 SMT. SANGITA JAIN INDORE ::: APPELLANT VS INCOME TAX OFFICER 4(3) INDORE ::: RESPONDENT APPELLANT BY SHRI S.N. AGRAWAL RESPONDENT BY SHRI MOHD. JAVED DATE OF HEARING 2 1 .6.2016 DATE OF PRONOUNCEMENT 4 . 7 . 2016 O R D E R THIS IS AN APPEAL PREFERRED BY THE ASSESSEE AGAINST THE ORDER DATED OF LEARNED CIT(A)-22, NEW DELHI , HAVING CONCURRENT JURISDICTION OF CIT(A), INDORE-1. 2. GROUND NO. 1 RELATED TO CONFIRMATION OF THE ADDITI ON OF RS.11 LACS MADE BY THE ASSESSING OFFICER ON ACCOUNT O F SHORT TERM CAPITAL GAIN ON SALE OF HOUSE. SMT. SANGITA JAIN ITA NO./IND/2016 2 3. THE SHORT FACTS OF THE CASE ARE THAT THE ASSESSEE IS WORKING IN M/S RENUKA FINCOM PVT. LTD. AS PER THE AI R INFORMATION THE ASSESSEE SOLD PROPERTY AT RS.69,81,000 /-. THE ASSESSEE HAS SHOWN CAPITAL GAIN OUT OF THE AFORESAID TRANSACTION AT RS.3,15,815/-. THE ASSESSING OFFICER HAS VERIFIED THE COPY OF PURCHASE DEED AND SALE DEED REGARD ING CAPITAL GAIN SHOWN BY HER. AS PER THE PURCHASE DEED THE PROPERTY WAS PURCHASED BY THE ASSESSEE FROM ANAND SETHI A HUF FOR RS. 51,13,800/- + STAMP EXPENSES + OTHER EXPENSES WHICH COME TO RS.55,65,185/-. AS PER THE S ALE DEED THE PROPERTY WAS SOLD TO KUSUM GARG AT RS.69,81,000/-. ON EXAMINATION OF THE MATTER IT WAS FOU ND THAT COST OF HOUSE WAS INFLATED BY RS. 11 LACS BY INCLU DING PURCHASE COST OF FIXED FURNITURE. AFTER THIS INCLUS ION, THE PURCHASE COST COMES TORS.66,65,185/- WHICH WAS ADOPTED BY THE ASSESSEE FOR COMPUTING CAPITAL GAIN. THE ASSESSI NG OFFICER HAS VERIFIED THE SAME AND WAS OF THE VIEW THAT T HE SMT. SANGITA JAIN ITA NO./IND/2016 3 COST OF FURNITURE CANNOT BE INCLUDED IN THE COST OF APPRECIATION AS THE COST OF FURNITURE STATED TO BE RS.5 000/- TO RS.10,000/- BY THE PURCHASER. THEREFORE, THIS WAS DISALLOWED. ON APPEAL, THE LEARNED CIT(A) CONFIRMED TH E SAME. NOW THE ASSESSEE IS IN APPEAL. 4. DURING THE COURSE OF HEARING, THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE HAS ADVANCED AMOUNT TO ANAND SETHIA ONE OF THE FAMILY FRIENDS OF THE ASSESSEE AND IN TURN AS A SECURITY HOUSE OF ANAND SETHIA WAS REGISTERED IN THE NAME OF THE ASSESSEE FOR CONSIDERATION OF RS. 55,65,185/-, THE HOUSE WAS REGIS TERED IN THE NAME OF THE ASSESSEE AS A SECURITY. ANAND SETHIA AND HIS FAMILY RESIDED TILL THE DATE OF SALE OF THEIR H OUSE. THE SALE DEED WAS EXECUTED BY THE ASSESSEE. AT THE THE TIME OF SALE OF HOUSE BY ANAND SETHIA, THE AMOUNT OF RS .11 LACS WAS RECEIVED ON ACCOUNT OF COST OF FIXED FURNITUR E AND THE AMOUNT TOWARDS THE COST OF HOUSE. THE ASSESSEE ON SMT. SANGITA JAIN ITA NO./IND/2016 4 RECEIPT OF FIRST CHEQUE AT THE TIME OF SALE OF THE HOU SE, IMMEDIATELY TRANSFERRED THE HOUSE TO ANAND SETHIA AND AGREEMENT WAS ALSO EXECUTED. THE AMOUNT OF RS.11 LACS WAS PAID THROUGH ACCOUNT PAYEE CHEQUE AND IT IS CONSIDERED AS COST OF HOUSE SOLD BY THE ASSESSEE. TH E ASSESSEE GOT REGISTERED THE SAID HOUSE AS SECURITY AND THE PAYMENT IS RECEIVED TOWARDS SALE OF THE HOUSE WHICH MAY BE ALLOWED. 5. ON THE OTHER HAND, THE LEARNED DR RELIED UPON THE ORDERS OF THE AUTHORITIES BELOW. HE DREW MY ATTENTION TO PARA 6 OF THE ORDER OF THE LEARNED CIT(A) WHEREIN THE LEARNED CIT(A) HAS SPECIFICALLY HELD THAT THE ASSESSEE H AS PURCHASED ONE HOUSE ON 5.2.2009 FOR CONSIDERATION OF RS.55,55,185/-. THE ASSESSEE HAS SOLD THIS HOUSE AT RS.69,81,000/-. THE ASSESSEE CLAIMED THAT SHE HAS TRANSFERRED RS.11 LACS OUT OF SALE PROCEEDS TO ANAND SE THIA HUF TOWARDS COST OF FIXED FURNITURE IN THE HOUSE SMT. SANGITA JAIN ITA NO./IND/2016 5 PURCHASED. THERE WAS NO MENTION IN THE AGREEMENT OF SU CH FURNITURE AND STAMP USED FOR SALE OF FIXED FURNITURE. THE FURNITURE WAS PURCHASED ON 7.4.2010 WHILE THE FIRST PAYMENT WAS RECEIVED ON 15.4.2010. THEREFORE, THE ST ORY OF THE ASSESSEE BY NO STRETCH OF IMAGINATION CANNOT BE BELIEVED. 6. I HAVE HEARD BOTH THE SIDES. LOOKING TO THE FACTS AN D CIRCUMSTANCES OF THE CASE, I AM OF THE VIEW THAT AS PER THE ASSESSEE, THE ASSESSEE HAS PURCHASED ONE PROPERTY FOR CONSIDERATION OF RS.55,55,185/- INCLUDING STAMP DUTY EXPENSES. THE SAID PROPERTY WAS SOLD ON 19.8.2010 FOR CONSIDERATION OF RS.69,81,000/-. THE ASSESSEE CLAIMED THAT SHE HAS TRANSFERRED RS. 11 LACS FOR SALE PROCEEDS TO AN AND SETHIA BY ACCOUNT PAYEE CHEQUE TOWARDS THE COST OF FIXE D FURNITURE IN THE HOUSE PURCHASED. NOW THE QUESTION REMAINS AS TO WHETHER ANAND SETHIA HAS SHOWN THIS RS.11 LACS IN HIS BOOKS OF ACCOUNTS AND WHETHER ANAND SETHIA SMT. SANGITA JAIN ITA NO./IND/2016 6 HAS SHOWN THIS AMOUNT WHILE COMPUTING THE CAPITAL GAINS IN HIS ACCOUNT. THAT FACT HAS TO BE VERIFIED BY THE ASS ESSING OFFICER. IN THIS INSTANT CASE, IT IS THE CASE OF THE AS SESSEE THAT RS. 11 LACS IS PAID BY HER TO ANAND SETHIA. THEREF ORE, IF ANAND SETHIA HAS SHOWN RS.11 LACS IN HIS ACCOUNTS T HEN NO ADDITION IS CALLED FOR. THEREFORE, THE ASSESSING O FFICER IS DIRECTED TO VERIFY THIS FACT. THE ASSESSEE IS ALSO DIR ECTED TO PRODUCE ANAND SETHIA BEFORE THE ASSESSING OFFICER FOR EXAMINATION AS ALSO THE ACCOUNTS OF ANAND SETHIA. THE ASSESSING OFFICER IS AT LIBERTY TO DECIDE THE MATTER AFTER CONSIDERING AND VERIFYING THE ENTIRE MATTER AFRESH. I ORDER ACCORDINGLY. 7. IN THE RESULT, THE APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED IN OPEN COURT ON 4 TH JULY, 2016 SD/- (D.T. GARASIA) JUDICIAL MEMBER SMT. SANGITA JAIN ITA NO./IND/2016 7 4 TH JULY, 2016 DN/- SMT. SANGITA JAIN ITA NO./IND/2016 8