Shri J.Anjaneya Sharma, Sec'bad., V. ITO,W-10(2),Hyd.,

MA 235/HYD/2013

• Counselvise Citation: [2014] 124 COUNSELVISE.COM (IT) 1422 (ITAT-HYDERABAD)
• Duration Of Justice: 2 month(s) 30 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 10-01-2014
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: misc
• Appeal Filed On: 11-10-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: S RAMA RAO
• Keywords: Sale consideration of property below Jantri Value; Depreciation; Fair market value; Valuation report
• Section: 50C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A', HYDERABAD BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER MA NO. 235/HYD/2013 (IN ITA NO. 1680/HYD/2012 A.Y. 2007-08) INCOME TAX OFFICER, WARD 10(2), HYDERABAD. VS J. ANJANEYA SHARMA, SECUNDERABAD. PAN AELPA 3982 N) APPELLANT RESPONDENT REVENUE BY: SMT. K. HARITHA ASSESSEE BY: SHRI S. RAMA RAO DATE OF HEARING: 03/01/2014 DATE OF PRONOUNCEMENT: 10/01/2014 O R D E R PER CHANDRA POOJARI, A.M.: THE ABOVE MISCELLANEOUS APPLICATION (MA) FILED BY ASSESSEE IS SEEKING RECTIFICATION IN THE ORDER OF T HE TRIBUNAL DATED 17/06/2013 IN ITA NO. 1680/HYD/2012. 2. THE LEARNED AR SUBMITTED THAT ON AN EARLIER OCCA SION, THE REVENUE CAME IN APPEAL BEFORE THE TRIBUNAL FOR AY 2 007-08 QUESTIONING THE CIT(A)S DIRECTION TO ADOPT THE VAL UE OF BUILDING AS PER THE VALUE DETERMINED BY THE DVO AND VALUE OF THE LAND AS PER THE STAMP VALUATION AUTHORITY OF GOVT. OF AP. F URTHER, HE SUBMITTED THAT THE TRIBUNAL ADJUDICATED THESE ISSUE S IN PARA 8 OF THE ORDER AND DIRECTED THE ASSESSING OFFICER TO VAL UE BOTH THE LAND AND BUILDING FOR THE PURPOSES OF SECTION 50C O F THE IT ACT, AS PER THE STAMP VALUATION AUTHORITY AND COMPLETE T HE ASSESSMENT ACCORDINGLY. ACCORDING TO THE LEARNED AR THE LAND AND BUILDING ARE TWO DIFFERENT ASSETS AND THE SAME COULD BE VALUED DIFFERENTLY FOR THE PURPOSE OF DETERMINING C APITAL GAINS. MA NO. 235/ HYD/2013 J. ANJANEYA SHARMA 2 FOR THIS PROPOSITION, HE RELIED ON THE FOLLOWING JU DGEMENTS TO SUGGEST THAT LAND AND BUILDING ARE TWO DIFFERENT AS SETS: 1. CIT VS. VIMAL CHAND GULECHA, 201 ITR 442 ( RAJ.) 2. CIT VS. DR. D.L. RAMACHANDRA RAO, 236 ITR 51 (MA D.) 3. CIT VS. T.C. ITTY IPE, 249 ITR 591 ( MAD.) THE AR SUBMITTED THAT THE RATIO LAID DOWN IN THE AF ORESAID DECISIONS IS THAT THE PLOT AND SUPER STRUCTURE ARE TO BE TREATED AS TWO DIFFERENT ASSETS FOR THE PURPOSE OF DETERMIN ING THE CAPITAL GAIN. WHEN THE BUILDING IS TO BE CONSIDERED AS TWO DIFFERENT ASSETS AND WHEN THE SUB REGISTRAR AND THE DVO VALUE D THE LAND AND THE SUPER STRUCTURE SEPARATELY. 3. FURTHER, THE LEARNED AR SUBMITTED THAT THE ASSET IN QUESTION CONSISTS OF TWO DIFFERENT ASSETS AND FOR T HE PURPOSE OF VALUATION WAS NOT CONSIDERED AS A SINGLE ITEM EITHE R BY THE SUB- REGISTRAR OR BY THE VALUATION CELL. HE POINTED OUT THAT IN THE VALUATION REPORT, THE VALUATION CELL ARRIVED AT THE AGGREGATE VALUE BY DETERMINING THE VALUE OF THE BUILDING AND VALUE OF THE LAND SEPARATELY AND THE EXTRACT FROM THE SAID VALUATION REPORT IS AS UNDER: FMV OF THE BUILDING AS ON 12/04/2006 31,93,294/- FMV OF LAND 2,15,26,890/- 3.1 HE SUBMITTED THAT THE SUB REGISTRAR ALSO DETERM INED THE VALUE OF THE LAND AND BUILDING SEPARATELY. THE LAND IS VALUED AT RS. 18,000/- PER SQ. YARD OR AT RS. 1,38,60,000/- A ND THE VALUE OF THE BUILDING AT RS. 61,20,000/- AND THEREFORE, BOTH THE AUTHORITIES I.E. THE SUB REGISTRAR AND THE DVO VALUED THE PROPE RTY AS TWO DIFFERENT ASSETS. 4. THE AR SUBMITTED THAT THE DIRECTION OF THE HONB LE TRIBUNAL IS TO THE EFFECT THAT THE VALUE OF THE ASSET AS A W HOLE IS TO BE MA NO. 235/ HYD/2013 J. ANJANEYA SHARMA 3 DETERMINED EITHER AS PER THE STAMP VALUATION AUTHOR ITY OR AS PER THE VALUE FIXED BY DVO. FURTHER, IT WAS SUBMITTED T HAT THERE ARE TWO ASSETS I.E. LAND AND BUILDING. REFERRING TO THE PROVISIONS OF SECTION 50C OF THE ACT, THE AR SUBMITTED THAT THE V ALUE ADOPTED BY THE SUB REGISTRAR HAS TO BE TAKEN INTO CONSIDERA TION FOR THE PURPOSE OF DETERMINING THE CAPITAL GAIN. WHEN THE S AID VALUE IS DISPUTED BY THE PETITIONER, THE MATTER IS TO BE REF ERRED TO THE VALUATION CELL. IN THE CASE OF THE PETITIONER, THE MARKET VALUE OF THE LAND AND BUILDING ARE SEPARATELY DETERMINED BY THE SUB REGISTRAR AND BOTH THE VALUATIONS ARE IN DISPUTE. W HEN A REFERENCE IS MADE, THE VALUATION CELL DETERMINED TH E MARKET VALUE OF THE LAND AND BUILDING SEPARATELY. IT WAS C ONTENDED THAT BOTH THE AUTHORITIES CONSIDERED THE LAND AND BUILDI NG SEPARATELY AND IN FACT SUCH DIVISION IS BASED ON THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF CIT(PUNJAB) VS. ALPS T HEATRE, 65 ITR 377 WHEREIN IT IS HELD THAT THE BUILDING DOES N OT INCLUDE LAND. 5. FINALLY, THE AR SUBMITTED THAT THERE IS A MISTAK E IN THE JUDGMENT OF THE HONBLE ITAT AND REQUESTED THAT THE HONBLE ITAT MAY KINDLY CONSIDER THE ABOVE SUBMISSIONS AND PASS APPROPRIATE ORDER U/S 254(2) OF THE IT ACT. 6. ON THE OTHER HAND, THE LEARNED DR SUBMITTED THAT THERE IS NO MISTAKE APPARENT ON RECORD IN THE ORDER OF THE T RIBUNAL, WHICH REQUIRES ANY RECTIFICATION. HE SUBMITTED THAT THE C ASE LAWS RELIED UPON BY THE LEARNED AR ARE NOT RELATED TO THE ISSUE OF THE PROVISIONS OF SECTION 50C OF THE ACT, BUT, THEY ARE RELATED TO DEPRECIATION. HE, THEREFORE, SUBMITTED THAT THERE I S NO NECESSITY TO RECTIFY THE ORDER OF THE TRIBUNAL. 7. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. THE TR IBUNAL ADJUDICATE THE ISSUE IN DISPUTE OBSERVING THAT THE LAND AND MA NO. 235/ HYD/2013 J. ANJANEYA SHARMA 4 BUILDING TO BE VALUED EITHER ON THE BASIS OF THE RE PORT OF THE DVO OR AS PER THE STAMP VALUATION AUTHORITIES (SRO) FOR THE PURPOSE OF SECTION 50C OF THE ACT. WE ARE OF THE VIEW THAT IT IS A CONSCIOUS DECISION OF THE TRIBUNAL AND AFTER DULY APPLYING THE MIND THIS DECISION WAS TAKEN. NOW, THE LEARNED AR W ANTED TO REVIEW THE ORDER OF THE TRIBUNAL, WHICH IS NOT PERM ITTED U/S 254(4) OF THE IT ACT. FURTHER, THE DECISIONS RELIED ON BY THE LEARNED AR ARE NOT RELATING TO THE PROVISIONS OF SE CTION 50C OF THE ACT AND THEREFORE THE SAME ARE NOT APPLICABLE TO THE FACTS OF THE CASE OF THE ASSESSEE. WE MAY MENTION HEREIN THA T WE MIGHT HAVE COMMITTED AN ERROR OF JUDGEMENT BUT THE ASSESS EE IS FREE TO EXPLORE THE REMEDY AVAILABLE UNDER THE LAW. 8. IN THE RESULT, THE MA FILED BY ASSESSEES IS DIS MISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 10/01/2 014. SD/- SAKTIJIT DEY JUDICIAL MEMBER SD/- CHANDRA POOJARI ACCOUNTANT MEMBER SD/- SD/- HYDERABAD, DATED THE 10 TH JANUARY, 2014 KV COPY TO:- 1) SRI J. ANJANEYA SHARMA, PLOT NO. 16, GUNROCK ENCLAVE, MUD FORT, SECUNDERABAD 500 09. 2) ITO, WARD 10(2) HYDERABAD. 3) THE CIT(A)-VI, HYDERABAD 4) CIT-V,, HYDERABAD 5) THE DEPARTMENTAL REPRESENTATIVE, I.T.A.T., HYDERABAD.