SHRI A. IMITIAZ, MADURAI V. ITO, NCW - 2 (2), MADURAI

MA 117/CHNY/2022

AI Insights

The case involves four Miscellaneous Petitions filed by Shri I. Gulam, Shri I. Fakhrudeen, Smt. Halima, and Shri A. Imitiaz against the Income Tax Officer, Non Corporate Ward 2(2), Madurai, concerning the assessment year 2012-13. The assessees sought to recall a common order that had rejected their claims for deductions under sections 54 and 54F of the Income Tax Act, 1961, related to the purchase and construction of a residential property. The Tribunal had previously remitted the matter back to the Assessing Officer for de novo consideration, directing the assessees to furnish complete details for verification. However, the assessees contended that the Tribunal's order did not explicitly direct the consideration of their claims under the correct sections, which they argued was a mistake apparent from the record. The Tribunal found no such mistake and dismissed the petitions.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 135376 (ITAT-CHENNAI)
• Duration Of Justice: 11 month(s) 25 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 12-10-2023
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 05-10-2023
• Assessment Year: 2012-2013
• Appeal Filed On: 17-10-2022
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Valuation report; Set aside; Capital Gains
• Section: 54; 54F; 133(6); 205

Judgement Text

आयकर अपीलीय अिधकरण, ’बी’ Ɋायपीठ, चेɄई IN THE INCOME-TAX APPELLATE TRIBUNAL ‘B’ BENCH, CHENNAI ŵी वी दुगाŊ राव Ɋाियक सद˟ एवं ŵी जी. मंजुनाथा, लेखा सद˟ के समƗ Before Shri V. Durga Rao, Judicial Member & Shri Manjunatha, G. Accountant Member M.P. No. 114/Chny/2022 [In I.T.A. No.203/Chny/2020] िनधाŊरण वषŊ/Assessment Years: 2012-13 Shri I. Gulam, S/o. Imitiaz, No. 231, K.K. Nagar, Madurai 625 020. [PAN:BACPG6476P] Vs. The Income Tax Officer, Non Corporate Ward 2(2), No. 2, V.P. Rathinasamy Nadar Road, Bibikulam, Madurai 625 002. (अपीलाथŎ/Appellant) (ŮȑथŎ/Respondent) M.P. No. 115/Chny/2022 [In I.T.A. No.204/Chny/2020] िनधाŊरण वषŊ/Assessment Years: 2012-13 Shri I. Fakhrudeen, S/o Imitiaz, No. 231, K.K. Nagar, Madurai 625 020 [PAN: AAXPF5259M] Vs. The Income Tax Officer, Non Corporate Ward 2(2), No. 2, V.P. Rathinasamy Nadar Road, Bibikulam, Madurai 625 002. (अपीलाथŎ/Appellant) (ŮȑथŎ/Respondent) M.P. No. 116/Chny/2022 [In I.T.A. No.205/Chny/2020] िनधाŊरण वषŊ/Assessment Years: 2012-13 Smt. Halima, W/o Shri A. Imitiaz, No. 231, K.K. Nagar, Madurai 625 020 [PAN: AACPH1491G] Vs. The Income Tax Officer, Non Corporate Ward 2(2), No. 2, V.P. Rathinasamy Nadar Road, Bibikulam, Madurai 625 002. (अपीलाथŎ/Appellant) (ŮȑथŎ/Respondent) M.P. No. 117/Chny/2022 [In I.T.A. No.206/Chny/2020] िनधाŊरण वषŊ/Assessment Years: 2012-13 Shri A. Imitiaz, No. 231, K.K. Nagar, Madurai 625 020 [PAN: AADPI4938E] Vs. The Income Tax Officer, Non Corporate Ward 2(2), No. 2, V.P. Rathinasamy Nadar Road, Bibikulam, Madurai 625 002. M.P. Nos. 114-117/Chny/22 2 (अपीलाथŎ/Appellant) (ŮȑथŎ/Respondent) अपीलाथŎ की ओर से / Appellant by : Shri I. Dinesh, Advocate ŮȑथŎ की ओर से/Respondent by : Shri V. Nandakumar, JCIT सुनवाई की तारीख/ Date of hearing : 06.10.2023 घोषणा की तारीख /Date of Pronouncement : 13.10.2023 आदेश /O R D E R PER V. DURGA RAO, JUDICIAL MEMBER: By means of four Miscellaneous Petitions pertaining to various assessees, the assessees seek to recall the common order passed by the Tribunal in assessees’ appeals in ITA No. 203, 204, 205 & 206/Chny/2020, vide order dated 29.07.2022 for the assessment year 2012-13. 2. By referring to the petitions, the ld. Counsel for the assessee has pointed out that there are two investments viz., one is ₹.53,22,660/- by all co-owners and the additional claim of deduction claimed before the ld. CIT(A) on additional construction cost of ₹.59,77,340/- made by all co- owners [25% share of each assessee]. The ld. Counsel for the assessee has also submitted that the assessee, originally claimed for exemption under section 54 of the Income Tax Act, 1961 [“Act” in short] in the return of income. It was submitted that the Assessing Officer has expressed a M.P. Nos. 114-117/Chny/22 3 view that the assessee is eligible for deduction under section 54F of the Act. However, no view has been expressed by the Tribunal. It was further submission that in paragraph 7 of the order, the Tribunal has referred to both section 54F and section 54 of the Act. Accordingly, it was submitted that the omission to give specific finding on the applicable provision is a mistake apparent from record. 3. On the other hand, the ld. DR has submitted that there is no mistake apparent from record. 4. We have heard both the sides, gone through the order passed by the Tribunal dated 29.07.2022 including written submissions filed by the ld. Counsel for the assessee. We have also gone through the assessment order carefully. The assessee, initially made a claim under section 54 of the Act and submitted that it is a residential property. The Assessing Officer asked the assessee to produce plan approval of sold property, electricity payment receipts evidencing the residential house property and any other taxes paid for the property in the assessee’s name to prove his claim that the property sold was a residential house property. However, no such details were filed by the assessee. Under those circumstances, the Assessing Officer, by letter dated 20.06.2014, under section 133(6) of the Act requested the Commissioner, Corporation of Coimbatore for M.P. Nos. 114-117/Chny/22 4 furnishing the nature of the property and other details like payment of property tax, water tax, etc. of the said property. Vide letter dated 04.08.2014, the Commissioner, Corporation of Coimbatore has submitted that the property is a commercial property and rate ₹.10 per sq. ft. of the commercial rate and collection printout of the commercial taxes paid by the assessee. By considering the same, the Assessing Officer has rejected the claim of the assessee. 5. During the present proceedings, the ld. Counsel for the assessee has submitted that the Assessing Officer has expressed a view that the assessee is eligible for deduction under section 54F of the Act. On perusal of the assessment order, we find that nowhere in the assessment order, the Assessing Officer has expressed a view that the assessee is eligible for deduction under section 54F of the Act. 6. So far as deduction under section 54F of the Act is concerned, before the ld. CIT(A) the assessee has filed a letter dated 03.03.2017 by stating that the assessee is eligible for exemption under section 54F of the Act for the entire capital gains and also submitted that the entire sale consideration has been utilized for purchase of house at No. 10, Managiri 4 th street, Madurai at ₹.53,22,660/- and construction expenses (new claim) at ₹.59,77,340/- totalling to ₹.1,13,00,000/-. The ld. CIT(A) has M.P. Nos. 114-117/Chny/22 5 noted that in the return of income for the assessment year 2012-13 filed on 27.02.2014, the assessee has claimed ₹.53,22,660/- as eligible deduction under section 54 of the Act for the purchase of a residential building for the four family members at No. 10, Managiri 4 th Street, Madurai on 18.05.2012 for ₹.53,22,660/-. In her return, she claimed 1/4 th of the above i.e., ₹.13,30,665/-. Before the ld. CIT(A), the assessee filed a letter on 03.03.2017 with a copy of valuation report from Shri J. Suresh, Consultant Civil Engineer & Approved Valuer dated 08.03.2015 and has made additional claim of ₹.59,77,340/- as construction expenses. The ld. CIT(A) noted that the details of cost of construction was not explained by the assessee and the construction details were not shown in the return of income filed on 27.02.2014. Since the assessee has not furnished the any details, the ld. CIT(A) observed that the assessee was not eligible for any further deduction under section 54F of the Act. The ld. CIT(A) also noted that as per the document, the purchase price of the property was ₹.48,75,000/- and in the return of income, the assessee claimed ₹.53,22,660/- as eligible deduction under section 54 of the Act. But, before the ld. CIT(A), the assessee claimed ₹.1,13,00,000/- as eligible deduction under section 54F of the Act. The assessee claimed additional expenses of ₹.59,77,340/-, but in the valuation report submitted, it was mentioned that the actual cost of construction was ₹.68,06,400/-. M.P. Nos. 114-117/Chny/22 6 However, the source of income for additional expenses was not explained. During the discussion with the AR of the assessee had by the ld. CIT(A), the above differences were not clarified and therefore, the ld. CIT(A) has held that the assessees have not eligible for the claim of ₹.1,13,00,000/- under section 54F of the Act. Before ITAT, during the course of appeal proceedings, since the ld. Counsel for the assessee has submitted that the assessees are ready to file all the details before the Assessing Officer and prayed for remitting the matter back to the file of the Assessing Officer for fresh consideration, by considering the above submissions of the ld. Counsel, the Tribunal set aside the order of the ld. CIT(A) on this issue and remit the matter back to the file of the Assessing Officer for de novo consideration afresh in accordance with law and also directed the assessee to furnish complete details before the Assessing Officer for verification and deciding the issue. 7. Now, the ld. Counsel for the assessee says that the ITAT has not directed that the claim of the assessee has been considered under section 54F of the Act or under section 54 of the Act, is a mistake apparent on record. In this case, originally the assessee has claimed deduction under section 54 of the Act. After calling report from the Commissioner, Corporation of Coimbatore and considering the same, the M.P. Nos. 114-117/Chny/22 7 Assessing Officer has held that the claim made by the Assessing was relating to commercial property and therefore not eligible for deduction under section 54 of the Act. Before the ld. CIT(A) by filing an application dated 03.03.2017, the assessee claimed exemption under section 54F of the Act. The ld. CIT(A) has pointed out after verifying the documents that the purchase price of the property was ₹.48,75,000/- and in the return of income, the assessee claimed ₹.53,22,660/- as eligible deduction under section 54 of the Act and before the ld. CIT(A), the assessee claimed ₹.1,13,00,000/- as eligible deduction under section 54F of the Act. The assessee claimed additional expenses of ₹.59,77,340/-, but in the valuation report submitted, it was mentioned that the actual cost of construction was ₹.68,06,400/-. Under the above facts and circumstances, the Tribunal was of the opinion that the Assessing Officer has to consider all the details and pass order in accordance with law. Therefore, in the appeal order dated 29.07.2022, the Tribunal remitted the matter back to the file of the Assessing Officer for de novo consideration afresh in accordance with law. Since the assessee has not filed any details either before the Assessing Officer or before the ld. CIT(A) or even before the ITAT, the Tribunal has not directed the Assessing Officer to consider under section 54 or section 54F of the Act. M.P. Nos. 114-117/Chny/22 8 8. Under these facts and circumstances, we are of the opinion that there is no mistake apparent on record in the common order passed by the Tribunal dated 29.07.2022 in I.T.A. Nos. 203-206/Chny/2020. Accordingly, all the Miscellaneous Petitions filed by different assessees are dismissed. 9. In the result, all the MPs filed by the assessees are dismissed. Order pronounced on 13 th October, 2023 at Chennai. Sd/- Sd/- (MANJUNATHA, G.) ACCOUNTANT MEMBER (V. DURGA RAO) JUDICIAL MEMBER Chennai, Dated, 13.10.2023 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.