ACIT CIR 21(3), MUMBAI V. CELESTE ANN PEREIRA, MUMBAI

ITA 938/MUM/2013

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 83475 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 6 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-08-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2009-2010
• Appeal Filed On: 04-02-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A K KARDA M
• Keywords: Gift; Cost of acquisition

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, MUMBAI BEFORE SHRI D. KARUNAKARA RAO, ACCOUNTANT MEMBER AND SHRI AMIT SHUKLA, JUDICIAL MEMBER ./I.T.A. NO.938/M/2013 ( AY: 2009 - 2010 ) ACIT CIR 21(3), R.NO.501, BLDG, 5 TH FLOOR, C - 11, PRATYAKSHAKAR BHAVAN, BKC BANDRA (E), MUMBAI - 400051. / VS. MRS. CELESTE ANNA PER E I RA, CELESTINO VILLA , GR. FLOOR, 238, A.H. WADIA MARG, KURLA (W), MUMBAI - 400024. ./ PAN : AKRPP 5757 E ( / APPELLANT) .. ( / RESPONDENT ) / APPELLANT BY : SHRI A.K. KARDA M, DR / RESPONDENT BY : NONE / DATE OF HEARING :4.8.2014 / DATE OF PRONOUNCEMENT :4.8.2014 / O R D E R PER D. KARUNAKARA RAO, AM: THIS APPEAL FILED BY THE REVENUE ON 4.2.2013 IS AGAINST THE ORDER OF THE CIT (A) 32, MUMBAI DATED 8.11.2012 FOR THE ASSESSMENT YEAR 2009 - 2010. 2. IN THIS APPEAL, REVENUE RAISED THE FOLLOWING GROUNDS WHICH READ AS UNDER: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD CIT (A) HAS ERRED IN ALLOWING THE BENEFIT OF INDEXATION FROM 1981 AS AGAINST THE YEAR 1992 FOR THE PURPOSE OF COMPUTING LONG TERM CAPITAL GAIN. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD CIT (A) HAS ERRED IN RELYING ON THE BOMBAY HIGH COURT DECISION IN THE CASE OF MANJULA J. SHAH REPORTED IN 249 CTR . IN DOING SO, THE LD CIT (A) HAS NOT APPRECIATED THAT THE DEPARTMENT AND SLP HAS BEEN FILED AGAINST THE DECISION OF THE HONBLE HIGH COURT. 3. DURING PROCEEDINGS BEFORE US, AT THE TIME OF HEARING THERE IS NONE APPEARED TO REPRESENT THE CASE OF THE ASSESSEE . HOWEVER, LD DR FOR THE REVENUE FAIRLY MENTIONED THAT THE REVENUE FI LED THE PRESENT APPEAL WITH THE GROUND RELATING TO ALLOWING THE BENEFIT OF INDEXATION FROM 1981 IN CONNECTION WITH THE COMPUTATION OF LONG TERM CAPITAL GAINS . HE FURTHER MENTIONED THAT THE CIT (A) 2 GRANTED RELIEF TO THE ASSESSEE CONSIDERING THE JUDGMENT OF THE JURISDICTIONAL HIGH COURT IN THE CASE OF MANJULA J SHAH REPORTED IN 249 CTR 270 (BOM.) . M ERELY MENTIONING THAT THE DEPARTMENT FILED SLP AGAINST THE SAID JUDGMENT OF THE JU RISDICTIONAL HIGH COURT (SUPRA), THE REVENUE IS IN APPEAL BEFORE US. WE FIND T HAT IT IS THE FINDING OF THE CIT (A) THAT THE FATHER OF THE ASSESSEE HELD THE ASSET PRIOR TO THE DATE ON WHICH PROPERTY IS INHERITED BY THE ASSESSEE. LD DR FAIRLY MENTIONED THAT THE ISSUE IS NOW SETTLED IN FAVOUR OF THE ASSESSEE CONSIDERING THE BINDING JUD GMENT OF THE JURISDICTIONAL HIGH COURT. 4. WE HAVE HEARD THE LD DR AND PERUSED THE ORDERS OF THE REVENUE AUTHORITIES AS WELL AS THE RELEVANT MATERIAL PLACED BEFORE US. ON PERUSAL OF THE ORDER OF THE CIT (A) IN GENERAL AND PARA 3.2 IN PARTICULAR, WE FIND T HE SAID PARA IS RELEVANT IN THIS REGARD AND THE FOR THE SAKE OF COMPLETENESS OF THIS ORDER THE RELEVANT PORTION OF THE SAID PARA 3.2 IS REPRODUCED HERE UNDER: 3.2.IN VIEW OF THE ABOVE REASONING GIVEN BY THE HIGH COURT EXPLAINING THE RELEVANT PROVISIONS AND CBDT CIRCULAR NO.636, IT IS CLEAR THAT THE MOMENT A MODE OF TRANSFER IS COVERED U/S 49(1), THE CAPITAL GAINS LIABILITY HAS TO BE COMPUTED BY DEEMING THAT THE ASSESSEE HELD THE SAID ASSET FROM THE DATE IT WAS HELD BY THE PREVIOUS OWNER AND THE SAME ANA LOGY HAS ALSO TO BE APPLIED IN DETERMINING THE INDEXED COST OF ACQUISITION. THE PLEA THAT THE ABOVE DECISION WILL APPLY TO GIFT AND NO IN INHERITANCE IS ALSO NOT TENABLE BECAUSE THE TRANSFER BY WAY OF GIFT OR WILL OR INHERITANCE; ALL ARE DIFFERENT M ODES OF TRANSFER SPECIFICALLY MENTIONED U/S 49(1) AND HENCE, THE OBSERVATION OF COURT FOR CASES OF TRANSFERS U/S 49(1) WILL HAVE TO BE GIVEN SAME TREATMENT. EVEN OTHERWISE THE TRANSFER BY GIFT OR BY INHERITANCE WILL MAKE NO DIFFERENCE S FAR AS THE DAT E OF ACQUISITION IN HANDS OF THE ASSESSEE IS CONCERNED AND ON SAME ANALOGY BOTH MODES ARE REQUIRED TO BE TREATED SIMILARLY FOR PURPOSE OF DATE OF INDEXATION ALSO. HENCE, THE ASSESSEE IS ENTITLED TO GET THE BENEFIT OF INDEXATION FROM 1981 ITSELF AS THE FAT HER OF THE ASSESSEE WAS HOLDING THE ASSET PRIOR TO THIS DATE. ACCORDINGLY, THE AO IS DIRECTED TO ALLOW THE INDEXATION FROM 1981 - 82 ITSELF. 5. IT IS THE FINDING OF THE CIT (A), RELYING ON THE SAID JUDGMENT OF THE JURISDICTIONAL HIGH COURT (SUPRA), THAT T HE CAPITAL GAINS LIABILITY HAS TO BE COMPUTED BY DEEMING THAT THE ASSESSEE HELD THE ASSET PRIOR TO THE DATE OF INHERITANCE BY THE ASSESSEE OF THE SAID PROPERTY WHICH WAS HELD BY THE PREVIOUS OWNER I.E., HIS FATHER , IN THIS CASE. IT IS BINDING ON THE TRIBU NAL TO ADOPT THE RATIO LAID DOWN BY THE JURISDICTIONAL HIGH COURT. CONSIDERING THE SAME, WE ARE OF THE OPINION THAT THE ISSUE STANDS COVERED AGAINST THE REVENUE. ACCORDINGLY, GROUNDS RAISED BY THE REVENUE ARE DISMISSED. 6. IN THE RESULT, APPEAL OF THE RE VENUE IS DISMISSED. 3 ORDER PRONOUNCED IN THE OPEN COURT ON 4 TH AUGUST, 2014. S D / - S D / - (AMIT SHUKLA) (D. KARUNAKARA RAO ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; 4/08/2014 . . ./ OKK , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE . //TRUE COPY// / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI