M.Poonkodi, CHENNAI V. ITO Non Corporate Ward 2(5), CHENNAI

ITA 923/CHNY/2018

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 0326 (ITAT-CHENNAI)
• Duration Of Justice: 8 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-11-2018
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2008-2009
• Appeal Filed On: 19-03-2018
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: M KAUSHIK
• Keywords: Sale consideration of property below Jantri Value
• Section: 50C

Judgement Text

, SMC , IN THE INCOME TAX APPELLATE TRIBUNAL B SMC BENCH : CHENNAI BEFORE SHRI GEORGE MATHAN, JUDICIAL MEMBER . / I.T.A.NO.923/CHNY/2018 / ASSESSMENT YEAR : 2008-09 SMT.M.POONKODI , 1/230,BALAJI NAGAR EXTENSION, MADAMBAKKAM,GUDUVANCHERRY CHENNAI 602 202. VS. THE INCOME TAX OFFICER, NON CORPORATE WARD 2(5), CHENNAI. [PAN CVYPP 6086 J ] ( / APPELLANT) ( /RESPONDENT) / APPELLANT BY : MR.M.KAUSHIK,ADVOCATE /RESPONDENT BY : MR.B.SAGADEVAN,JCIT,D.R ! '# / DATE OF HEARING : 19 - 1 1 - 201 8 $% ! '# / DATE OF PRONOUNCEMENT : 19 - 1 1 - 201 8 / O R D E R THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS)-2,CHENNAI IN ITA NO.104/2016-17/A.Y 2008-09/CIT(A)/2 DATED 27.01. 2018 FOR THE ASSESSMENT YEAR 2008-09. ITA NO.923/CHNY/2018 :- 2 -: 2. SHRI M.KAUSHIK REPRESENTED ON BEHALF OF THE ASSESSEE AND SHRI B.SAGADEVAN REPRESENTED ON BEHALF OF THE RE VENUE. 3. IT WAS SUBMITTED BY LD.A.R THAT THE ASSESSEE W AS 1/5 TH OWNER IN PROPERTY, WHICH WAS SOLD. IT WAS A SUBMISSION THAT LD. ASSESSING OFFICER HAD APPLIED THE PROVISIONS OF THE SEC.50C O F THE ACT AND DETERMINED THE SALE CONSIDERATION OF ` 30 LAKHS. IT WAS A SUBMISSION THAT ONE FIFTH OF THAT AMOUNT WAS TREATED AS INCOME OF ASSESSEE. IT WAS A SUBMISSION THAT THE ISSUE WAS SQUARELY BY THE DECISION OF THE CO-ORDINATE SMC BENCH OF THIS TRIBUNAL IN THE CAS E OF ONE OF THE CO- OWNERS BEING S.SATHYAMURTHY IN ITA NO.1281/CHNY/201 8 DATED 30.10.2018 WHEREIN IT HAS BEEN HELD AS FOLLOWS: 2. VIDE ITS GROUND NO.3, ASSESSEE ASSAILS COMPUTA TION OF CAPITAL GAINS CONSIDERING THE VALUE OF A PROPERTY AT G30,00 ,000/- AGAINST G18,77,000/- ASSESSED BY THE DEPARTMENT VALUATION O FFICER. LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT ASSESSEE W AS A CASUAL LABOUR. ACCORDING TO HIM, ASSESSEE ALONG WITH HIS FOUR FAMILY MEMBERS HAD SOLD A PROPERTY AT VELACHERY, CHENNAI, DURING THE RELEVANT PREVIOUS YEAR, BY EXECUTING A POWER OF ATT ORNEY IN FAVOUR OF ONE SHRI. RADHAKRISHNAN. AS PER THE LD. AUTHORISED REPRESENTATIVE ASSESSEES FATHER WAS MURDERED ON A DISPUTE WITH RE GARD TO THE ABOVE PROPERTY AND THEREFORE LEGAL HEIRS, INCLUDING ASSESSEE HAD SOLD IT UNDER DISTRESS. CONTENTION OF THE LD. AUTHORISE D REPRESENTATIVE WAS THAT CONSIDERATION SHOWN IN THE SALE DEED THOU GH ONLY G25,00,000/- ASSESSEE BY MISTAKE, IN THE RETURN OF INCOME, HAD CALCULATED HIS SHARE TAKING THE CONSIDERATION AS G3 0,00,000/-. AS PER ITA NO.923/CHNY/2018 :- 3 -: LD. AUTHORISED REPRESENTATIVE, THE LD. ASSESSING OF FICER HAD REFERRED THE VALUATION OF THE PROPERTY TO THE VALUATION CELL OF THE DEPARTMENT, APPLYING ON SECTION 50C OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT). THE VALUER, AS PER THE LD.AR, HAD FIXED TH E VALUE OF THE PROPERTY AT G18,77,000/ -. ACCORDING TO THE LD. AUTHORISED REPRESENTATIVE, ASSESSEE AT THE BEST COULD HAVE BEE N ASSESSED FOR THE 1/5 TH SHARE IN G25,00,000/- AND NOTHING DONE. SUBMISSIO N OF THE LD. AUTHORISED REPRESENTATIVE WAS THAT LOWER AUTHOR ITIES HAD TAKEN ADVANTAGE OF THE IGNORANCE AND AN ERROR COMMITTED B Y THE ASSESSEE, WHILE FILING THE RETURN. 3. PER CONTRA, LD. DEPARTMENTAL REPRESENTATIVE SU BMITTED THAT ASSESSEE HIMSELF HAD SHOWN THE SALE CONSIDERATION R ECEIVED BY HIM AS 1/5 TH OF G30,00,000/-. ACCORDING TO HIM, ASSESSEE COULD NOT NOW TURN AROUND AND SAY THAT CONSIDERATION RECEIVED WAS ONLY G25,00,000/- 4. I HAVE CONSIDERED THE RIVAL CONTENTIONS AND PE RUSED THE ORDERS OF THE AUTHORITIES BELOW. CONTENTION OF THE ASSESSEE IS THAT THE SUM RECEIVED WAS ERRONEOUSLY CONSIDERED BY HIM AS G30,00,000/ - , AGAINST ACTUAL AMOUNT OF G25,00,000/ - MENTIONED IN THE DEED. IT IS NOT DISPUTED THAT THE VALUE FIXED FOR THE PROPERTY BY THE DEPARTMENT VALUATION OFFICER U/S.50C OF THE ACT WAS ONLY G18,77,000/ - THOUGH HE ADOPTED A HIGHER VALUE OF G25,00,000/- CONSIDERING WHAT WAS MENTIONED IN THE SALE DEED. I AM OF THE OPINION THA T LOWER AUTHORITIES OUGHT NOT HAVE TAKEN ADVANTAGE OF THE M ISTAKE COMMITTED BY THE ASSESSEE IN SHOWING THE CONSIDERA TION AT A HIGHER AMOUNT THAN WHAT WAS MENTIONED IN THE SALE DEED. ES PECIALLY SO, SINCE VALUATION CELL OF THE DEPARTMENT VALUED THE P ROPERTY AT G18,77,000/-. I THEREFORE DIRECT THE LOWER AUTHOR ITIES TO RECOMPUTE THE CAPITAL GAINS ADOPTING 1/5 TH CONSIDERATION OF G25,00,000/- AS THE ITA NO.923/CHNY/2018 :- 4 -: SUM RECEIVED BY THE ASSESSEE ON SALE OF THE PROPERT Y AT VELACHERY, CHENNAI. GROUND NO.3 IS TREATED AS PARTLY ALLOWED. 3.1 IN REGARD TO SECOND ISSUE, IT WAS A SUBMISSION THAT THE ASSESSEE HAD INVESTED HER SALE CONSIDERATION IN CONSTRUCTION OF ADDITIONAL SPACE IN ALREADY EXISTING OLD RESIDENTIAL HOUSE IN THE NA ME OF ASSESSEES HUSBAND. IT WAS A SUBMISSION THAT THE ASSESSEE CLAI MED BENEFIT OF DEDUCTION U/S.54F OF THE ACT. 4. IN REPLY, THE LD.D.R VEHEMENTLY OPPOSED THE CLA IMING OF BENEFIT U/S.54F OF THE ACT. IT WAS A SUBMISSION THAT HE HA D NO OBJECTION, IF THE ISSUE MAY BE RESTORED TO THE FILE OF LD. ASSESS ING OFFICER IN LINE WITH THE DECISION OF TRIBUNAL IN THE CASE OF S.SATHYAMUR THY REFERRED TO SUPRA. 5. I HAVE CONSIDERED THE RIVAL SUBMISSIONS. AS TH E ISSUE IN RESPECT OF SALE CONSIDERATION IS SQUARELY COVERED BY THE DE CISION OF THE CO-ORDINATE SMC BENCH OF THIS TRIBUNAL IN THE CAS E OF ONE OF THE CO-OWNERS BEING S.SATHYAMURTHY REFERRED TO SUPRA, R ESPECTFULLY FOLLOWING THE DECISION OF THE CO-ORDINATE SMC BE NCH OF THIS TRIBUNAL, THE LD. ASSESSING OFFICER IS DIRECTED TO RE-COMPUTE THE CAPITAL GAINS ADOPTING 1/5 TH SHARE AND CONSIDERATION OF ` 6/- LAKHS AS THE SUM ITA NO.923/CHNY/2018 :- 5 -: RECEIVED BY THE ASSESSEE ON THE SALE OF THE PROPERT Y AT VELACHERY. A PERUSAL OF THE GROUNDS RAISED BY THE ASSESSEE SHOWS THAT THE ASSESSEE HAS NOT CHALLENGED THE ISSUE OF VALUATION OF THE PR OPERTY AND THE ASSESSEE HAS ONLY CHALLENGED THE CLAIM FOR DEDUCTIO N U/S.54F OF THE ACT, WHICH WAS DENIED TO THE ASSESSEE. CONSEQUENTL Y, THE ARGUMENTS OF THE ASSESSEE IN RESPECT OF THE VALUATION OF THE PROPERTY BY APPLYING THE PROVISIONS OF THE SECTION 50C OF THE ACT AS DON E BY THE LD. ASSESSING OFFICER CANNOT BE CONSIDERED. COMING TO T HE ISSUE OF CLAIMING DEDUCTION U/S.54F OF THE ACT, IT IS NOTICE D THAT THE ASSESSEE HAS CONSTRUCTED ADDITIONAL SPACE ALLEGEDLY IN RESPE CT OF THE PROPERTY OWNED BY HER SPOUSE. THE INVESTMENT IN THE NEW PROP ERTY, OR INVESTMENT MADE TO ADDITIONS IN THE EXISTING OLD PR OPERTY IS NOT IN THE NAME OF THE ASSESSEE AND CONSEQUENTLY, THE BENEFIT OF DEDUCTION U/S.54F CANNOT BE GRANTED. IN THE CIRCUMSTANCES, GR OUND NOS. 1 TO 7 OF THE ASSESSEES APPEAL STANDS DISMISSED. 6. IN THE OPEN COURT, IT WAS PRONOUNCED AS PARTLY ALLOWED ON ACCOUNT OF THE FACT THAT THE ISSUE OF THE VALUATION AS DONE BY THE LD. ASSESSING OFFICER WAS CONSIDERED AS A SUBJECT MATT ER OF THE APPEAL ON THE BASIS OF THE SUBMISSIONS MADE BY THE LD.A.R ON THE BAR. I FIND THAT THE ISSUE OF VALUATION BY APPLICATION OF SEC.50C IS NOT FOUND IN THE ITA NO.923/CHNY/2018 :- 6 -: GROUNDS OF APPEAL. CONSEQUENTLY, THE APPEAL OF THE ASSESSEE IS DISMISSED. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DI SMISSED. ORDER PRONOUNCED IN THE OPEN COURT AFTER CONCLUSION OF HEARING ON 19 TH NOVEMBER, 2018, AT CHENNAI. SD/ - ( ) (GEORGE MATHAN) ! '# / JUDICIAL MEMBER & / CHENNAI ' / DATED: 19 TH NOVEMBER, 2018. K S SUNDARAM (!)* +*! / COPY TO: 1 . / APPELLANT 4. ,! / CIT 2. / RESPONDENT 5. *-.!/ / DR 3. ,!0 1 / CIT(A) 6. .23 / GF