ITO (iT) 2(1)(1), MUMBAI V. KERSHAW BURJOR COLABAWALLA, MUMBAI

ITA 948/MUM/2017

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 5619 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 4 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-07-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: H
• Assessment Year: 2012-2013
• Appeal Filed On: 10-02-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJAT MITTAL LD
• Keywords: Capital asset; Cost of acquisition
• Section: 143(3)

Judgement Text

ITA NO.948/MUM/2017 KERSHAW BURJOR COLABAWALLA ASSESSMENT YEAR-2012-13 IN THE INCOME TAX APPELLATE TRIBUNAL H BENCH, MUMBAI , , BEFORE SHRI JOGINDER SINGH, JM AND SHRI MANOJ KUMAR AGGARWAL, AM ./I.T.A. NO.948/MUM/2017 ( / ASSESSMENT YEAR: 2012-13) INCOME TAX OFFICER (INTERNATIONAL TAXATION)-2(1)(1) ROOM NO.1724, 17 TH FLOOR AIR INDIA BUILDING, NARIMAN POINT MUMBAI-400 020 / VS. KERSHAW BURJOR COLABAWALLA A3, BEN NEVIS BHULABHAI DESAI ROAD BREACH CANDY MUMBAI-400 0036 ./ ./PAN/GIR NO. AAAPC-5583-E ( ! /APPELLANT ) : ( '#! / RESPONDENT ) A SSESSEE BY : NONE RE VENUE BY : RAJAT MITTAL, LD. DR / DATE OF HEARING : 21/06/2018 / DATE OF PRONOUNCEMENT : 04/07/2018 / O R D E R PER MANOJ KUMAR AGGARWAL (ACCOUNTANT MEMBER) 1. AFORESAID APPEAL BY REVENUE FOR ASSESSMENT YEAR [AY] 2012-13 CONTEST THE ORDER OF THE LD. COMMISSIONER OF INCOME -TAX (APPEALS)-57 [CIT(A)], MUMBAI, APPEAL NO.CIT(A)-57/ARR.74/2016-17 DATED 24/10/2016 BY RAISING THE FOLLOWING SOLE GROUND OF APPEAL:- 1. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES O F THE CASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN HOLDING THAT WHILE COMPUTING TH E CAPITAL GAINS ARISING ON TRANSFER OF CAPITAL ASSET ACQUIRED BY THE ASSESSEE UNDER A G IFT, THE INDEXED COST OF ACQUISITION ITA NO.948/MUM/2017 KERSHAW BURJOR COLABAWALLA ASSESSMENT YEAR-2012-13 2 HAS TO BE COMPUTED WITH REFERENCE TO THE YEAR IN WH ICH THE PREVIOUS OWNER FIRST HELD THE ASSET AND NOT THE YEAR IN WHICH THE ASSESSEE BE CAME THE OWNER OF THE ASSET? THE ASSESSMENT FOR IMPUGNED AY WAS FRAMED BY LD. INCOME TAX OFFICER (INTERNATIONAL TAXATION)-2(1)(1), MUMBAI [A O] U/S 143(3) OF THE INCOME TAX ACT,1961 ON 17/03/2015 DETERMINING TOTAL INCOME AT RS.115.61 LACS. NONE HAS APPEARED FOR ASSESSEE SINCE RPAD NOTICE HAS RETURNED BACK UNDELIVERED AND UPDATED ADDRESS O F THE ASSESSEE IS NOT AVAILABLE ON RECORD. LEFT WITH NO OPTION, WE PR OCEED TO DISPOSE-OFF THE SAME ON THE BASIS OF MATERIAL AVAILABLE ON RECO RD AND AFTER HEARING LD. DEPARTMENTAL REPRESENTATIVE [DR], SH. RAJAT MITTAL. THE ONLY DISPUTE INVOLVED UNDER THE APPEAL IS THE YEAR FROM WHICH TH E INDEXATION BENEFIT SHALL BE AVAILABLE TO THE ASSESSEE IN CASE OF INHER ITANCE WHILE ARRIVING AT CERTAIN CAPITAL GAINS EARNED BY THE ASSESSEE DURING IMPUGNED AY. 2. DURING ASSESSMENT PROCEEDINGS, IT WAS NOTED THAT THE ASSESSEE EARNED CERTAIN CAPITAL GAINS ON SALE OF A RESIDENTI AL FLAT, WHICH DEVOLVED UPON THE ASSESSEE DURING FINANCIAL YEAR [FY] 2002-0 3 CONSEQUENT TO DEATH OF ASSESSEES FATHER. THE SAID FLAT WAS ACQUI RED BY THE ORIGINAL OWNER PRIOR TO 01/04/1981. ACCORDINGLY, THE ASSESSE E CLAIMED INDEXATION BENEFIT AGAINST THE SAME FROM FY 1981-82. HOWEVER, CONSIDERING THE PROVISIONS OF SECTION 48, LD. AO OPINED THAT INDEXA TION BENEFIT WAS AVAILABLE ONLY SINCE FY 2002-03, BEING THE YEAR IN WHICH THE FLAT ACTUALLY DEVOLVED UPON THE ASSESSEE. RESULTANTLY, THE INDEXA TION BENEFIT WAS ALLOWED ONLY FROM FY 2002-03 WHICH RESULTED INTO LO NG TERM CAPITAL GAINS BEING COMPUTED AT RS.115.61 LACS IN THE HANDS OF THE ASSESSEE. 3. AGGRIEVED, THE ASSESSEE CONTESTED THE SAME WITH SUCCESS BEFORE LD. CIT(A) VIDE IMPUGNED ORDER DATED 24/10/2016 WHE REIN LD. CIT(A), ITA NO.948/MUM/2017 KERSHAW BURJOR COLABAWALLA ASSESSMENT YEAR-2012-13 3 RELYING ON THE JUDGMENT OF HONBLE BOMBAY HIGH COUR T RENDERED IN MANJULA V. SHAH VS DCIT [355 ITR 474] CONCURRED WITH THE STAND OF THE ASSESSEE. AGGRIEVED, THE REVENUE IS IN FURTHER APPE AL BEFORE US. THE LD. DR HAS SUPPORTED THE STAND OF LD. AO. 4. UPON DUE CONSIDERATION, WE FIND THAT THE ISSUE U NDER HAND, AT PRESENT, STOOD SQUARELY COVERED IN ASSESSEES FAVOU R BY THE CITED JUDGMENT OF HONBLE BOMBAY HIGH COURT. ALTHOUGH, IT IS OBSERVED THAT SPECIAL LEAVE PETITION AGAINST THE SAID JUDGMENT HAS BEEN ADMITTED BY HONBLE APEX COURT VIDE SLP NO. 19924/2012, YET THE OPERATION OF THE JUDGMENT HAS NOT BEEN STAYED IN ANY MANNER BY THE H ONBLE APEX COURT AND THE RATIO OF THE DECISION, AT PRESENT, IS BINDI NG ON US. THE REVENUE HAS NEITHER DISPUTED THE BASIC FACTUAL MATRIX NOR A BLE TO BRING ON RECORD ANY CONTRARY JUDGMENT TO SUPPORT THE STAND OF LD. A O. THEREFORE, CONCURRING WITH THE STAND OF LD. CIT(A), WE DISMISS THE REVENUES APPEAL. 5. RESULTANTLY, THE REVENUES AAPPEAL STANDS DISMIS SED. ORDER PRONOUNCED IN THE OPEN COURT ON 04 TH JULY , 2018. SD/- SD/- (JOGINDER SINGH) (MANOJ KUMAR AGGARWAL) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI; DATED : 04 .07.2018. SR.PS:-THIRUMALESH ITA NO.948/MUM/2017 KERSHAW BURJOR COLABAWALLA ASSESSMENT YEAR-2012-13 4 ! / COPY OF THE ORDER FORWARDED TO : 1. ! / THE APPELLANT 2. '#! / THE RESPONDENT 3. * ( ) / THE CIT(A) 4. * / CIT CONCERNED 5. + '%, , , , / DR, ITAT, MUMBAI 6. -./ / GUARD FILE / BY ORDER, / (DY./ASSTT.REGISTRAR) , / ITAT, MUMBAI