ITO, Salem V. M.Seenivasan, Salem

MA 68/CHNY/2014

• Counselvise Citation: [2014] 124 COUNSELVISE.COM (IT) 1994 (ITAT-CHENNAI)
• Duration Of Justice: 3 month(s) 1 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 13-06-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 06-06-2014
• Assessment Year: 2008-2009
• Appeal Filed On: 12-03-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: GURU BASHYAM IRS
• Assessee Lawyers: T VASUDEVAN
• Keywords: Sale consideration of property below Jantri Value; Capital asset; Fair market value
• Section: 45(2)

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH : CHENNAI . , . . , ! ' [BEFORE SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMB ER AND SHRI S. S. GODARA, JUDICIAL MEMBER] M.P.NOS.68 & 69/MDS/2014 ./IN I.T.A.NOS.701 & 702/MDS/2013 ! '# / ASSESSMENT YEARS : 2008-09 & 2009-10. THE INCOME TAX OFFICER, WARD I (4), SALEM. VS. SHRI. M. SEENIVASAN, NO.2-12-1, YERCAUD MAIN ROAD, KANNANKURICHI, SALEM 638 008. [PAN AYUPS1767J] ( PETITIONER ) (RESPONDENT) PETITIONER BY : SHRI. GURU BASHYAM, IRS, JCIT. RESPONDENT BY : SHRI. T. VASUDEVAN, ADVOCATE $ '% & '() / DATE OF HEARING : 06-06-2014 *+#! & '() / DATE OF PRONOUNCEMENT : -06-2014 * / O R D E R PER S.S. GODARA, JUDICIAL MEMBER THE REVENUE HAS FILED THESE MISCELLANEOUS PETITION S U/S. 254(2) OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT) S EEKING TO RECALL ORDER OF THE TRIBUNAL DATED 20.09.2013 BY PLEADING AS F OLLOWS:- MP NOS.68 & 69/MDS/2014 IN ITA NOS.701 & 702 /MDS/2013 :- 2 -: THE HONORABLE INCOME TAX APPELLATE TRIBUNAL HAS PA SSED A COMMON ORDER IN ITA NOS. 481 & 482/MDS/2013 AND ITA NOS. 701 & 702/MDS/2013 DATED 20.09.2013 IN THIS CASE ON APPEALS FILED BY THE ASSESSEE AND THE REVENUE RESPECTIVELY. THE HONBLE INCOME TAX APPELLATE TRIBUNAL HAS DISMI SSED THE APPEALS FILED BY THE REVENUE AGAINST THE ORDER OF T HE CIT(A), WHILE ALLOWING THE APPEALS FILED BY THE ASSESSEE AG AINST THE ORDER OF THE CIT(A). IT IS RESPECTFULLY SUBMITTED THAT IN THIS ORDER, TH E HONBLE TRIBUNAL HAS NOT DECIDED ON THE GROUND RAISED BY TH E REVENUE BEING THE ALTERNATE PLEA ON THE INVOKING OF THE PRO VISIONS OF SECTION 45(2) IN THIS CASE BY THE HONBLE TRIBUNAL. THIS CONSTITUTED GROUND NO.3 OF THE GROUNDS OF APPEAL FI LED BY THE REVENUE, WHICH IS REPRODUCED HEREUNDER; 3. THE CIT(A) FAILED TO CONSIDER THE FACT THAT THE ASSESSEE HAD CONVERTED THE CAPITAL ASSET INTO STOCK -IN- TRADE DURING THE YEAR. IT IS SEEN FROM THE AUDIT R EPORT FILED WITH THE RETURN OF INCOME FOR THE A.Y. 2008-0 9 IN SL. NO.12A THAT THE ASSESSEE CONVERTED THE LAND BEI NG A CAPITAL ASSET INTO STOCK-IN-TRADE. AS THE PROVISIO NS OF SEC.45(2), ON CONVERSION OF THE CAPITAL ASSET INTO STOCK- IN-TRADE, THE CAPITAL GAINS WOULD BE SUBJECTED TO T AX AT THE TIME OF THE SALE OF THE STOCK-IN-TRADE AND FOR THE PURPOSES OF SEC. 48, THE FAIR MARKET VALUE OF THE A SSETS WOULD BE DEEMED TO BE THE FULL VALUE OF THE CONSIDERATION FOR THE PURPOSES OF SEC. 48. AS PER THE PROVISIONS OF SEC.50C, THE GUIDELINE VALUE WOULD BE DEEMED TO BE THE FULL VALUE OF THE CONSIDERATION FO R THE PURPOSES OF SEC.48. THUS, IN EFFECT, WHAT IS TO BE BROUGHT TO TAX IS THE GUIDELINE VALUE WHICH IS PREC ISELY WHAT THE AO HAS DONE IN THIS CASE. HENCE, THE CIT( A) OUGHT TO HAVE CONSIDERED THIS ASPECT WHICH GRANTING RELIEF. WHILE DOING SO, RELIANCE WAS PLACED ON THE DECISION OF THE HONBLE MADRAS HIGH COURT IN THE CASE OF SARAWATHI AMMAL (N.P) VS. CIT(1982) 138 ITR 19(MAD) WHEREIN THE HON HIGH COURT HAS HELD THAT TRIBUNAL IS EMPOWERED TO ENTERT AIN A NEW PLEA PUT FORTH BY THE DEPARTMENT. MP NOS.68 & 69/MDS/2014 IN ITA NOS.701 & 702 /MDS/2013 :- 3 -: IN THESE CIRCUMSTANCES, IT IS PRAYED THAT THE HON INCOME TAX APPELLATE TRIBUNAL MAY BE PLEASED TO ADMIT THIS MIS CELLANEOUS PETITION, AND RECTIFY THIS MISTAKE APPARENT FROM TH E RECORD. 2. IN THE COURSE OF HEARING, LEARNED DEPARTMENTAL REPR ESENTATIVE STRONGLY ARGUES THAT SINCE THE TRIBUNAL HAS NOT A DJUDICATED UPON THE GROUND HEREINABOVE, IT IS A MISTAKE APPARENT ON REC ORD MAKING IT A FIT CASE FOR RECALLING THE ORDER. IN SUPPORT, HE FILE S COPY OF CASE LAW N.P. SARASWATHI AMMAL VS. CIT (1983) 14 TAXMAN 406 (MAD) AND PRAYS FOR ACCEPTANCE OF THE INSTANT PETITIONS. 3. THE ASSESSEE HAS CHOSEN TO OPPOSE THE REVENUES PR AYER BY SUBMITTING THAT TRIBUNALS ORDER DOES NOT SUFFER ANY MISTAKE APPARENT ON RECORD. WE HAVE HEARD BOTH PARTIES AND GONE THROUGH THE CAS E FILES. THE JUDICIAL PRECEDENT QUOTED HAS ALSO BEEN CONSIDERED. 4. IT IS TO BE SEEN THAT THE ORDER DATED 20.09.2013 HA D DISPOSED OF FOUR CASES I.E ITA NOS.481 & 482/MDS/2013 (ASSESSEE S APPEALS) AND ITA NOS.701 & 702/MDS/2013 (INSTITUTED AT THE REVEN UES BEHEST). IN ASSESSEES APPEAL, HIS ONLY GRIEVANCE WAS THAT THE CIT(A) OUGHT TO HAVE VALUED PLOTS SOLD AT THE RATE OF K125/- PER SQ .FT. ON THE OTHER HAND, THE REVENUES ONE OF THE GROUNDS WAS THAT C IT(A) SHOULD HAVE MP NOS.68 & 69/MDS/2014 IN ITA NOS.701 & 702 /MDS/2013 :- 4 -: AGREED WITH THE ASSESSING OFFICER IN DETERMINING VA LUE OF THE PLOTS SOLD AT K175/- PER SQ.FT. BOTH PARTIES HAD CHALLENGED T HE CIT(A) HAD COMPUTED THIS VALUATION AT THE RATE OF K150/- PER S Q.FT. ALONGWITH THIS, THE REVENUE HAD ALSO RAISED ABOVESAID GROUND NO.3. IN THIS BACKDROP, BOTH PARTIES HAD FILED THEIR RESPECTIVE APPEALS. 5. COMING TO THE TRIBUNALS ORDER , IT TRA NSPIRES THAT THE ASSESSEE AS WELL AS THE REVENUE APPEARED TO HAVE MA DE A FAIR CLARIFICATION THAT ALL FOUR APPEALS INVOLVED AN IDE NTICAL ISSUE OF VALUATION OF PLOTS. THIS IS EXPRESSLY MENTIONED IN PARA NO.2 OF THE ORDER. THEREAFTER, THE TRIBUNAL ACCEPTED THE ASSESSEES ARGUMENTS; REJECTED THOSE RAISED BY THE REVENUE AND HELD THAT APPROPRIA TE VALUE OF THE PLOTS SOLD WAS AT K125/- PER SQ.FT. THE REVENUE HA S FILED THIS MISCELLANEOUS PETITIONS PLEADING THAT THE TRIBUNAL OUGHT TO HAVE CONSIDERED ITS GROUND NO.3. 6. AFTER GIVING OUR THOUGHT CONSIDERATION, WE FIND THAT THE GRIEVANCE PLEADED BY THE REVENUE IS NOT BORNE OUT F ROM THE LOG BOOK MAINTAINED ON THE SAID DATE. IT NOWHERE TRANSPIRES THAT THE REVENUE HAD RAISED ANY ARGUMENT QUA ITS GROUND NO.3. UNDIS PUTEDLY, THE REVENUES PLEADINGS IN ITS MISCELLANEOUS PETITIONS NOWHERE ALLEGE THAT IT HAD ARGUED THE SAID GROUND IN THE COURSE OF HEAR ING. NOR IS ANY MATERIAL FORTHCOMING IN THIS REGARDS. THE REVENUE MERELY PLEADS AND MP NOS.68 & 69/MDS/2014 IN ITA NOS.701 & 702 /MDS/2013 :- 5 -: ARGUES THAT IT IS INCUMBENT FOR THE TRIBUNAL TO A DJUDICATE ALL GROUNDS RAISED. THERE IS NO QUARREL ABOUT THE SAME. HOWEV ER, WE HOLD THAT THIS PRINCIPLE DOES NOT APPLY WHEN A GROUND IS PLEA DED ONLY BUT NOT CONTESTED IN THE COURSE OF ARGUMENTS. EVEN THE CAS E LAW QUOTED BY THE REVENUE DOES NOT DEAL WITH SUCH A SITUATION AS THEREIN THE ISSUES INVOLVED PERTAINED TO RAISING OF A NEW PLEA BEFORE THE TRIBUNAL. THEREFORE, WE HOLD THAT TRIBUNALS ORDER DATED 20. 09.2013 DOES NOT SUFFER ANY ERROR APPARENT ON THE FACE OF RECORD LIA BLE TO BE RECALLED. ACCORDINGLY, WE REJECT THE REVENUES CONTENTIONS AN D DISMISS THESE MISCELLANEOUS PETITIONS. 7. THE MISCELLANEOUS PETITIONS NOS.68 & 69/MDS/2014 ARE DISMISSED. ORDER PRONOUNCED ON FRIDAY, THE 13 TH OF JUNE, 2014, AT CHENNAI. SD/- SD/- ( . ) (A. MOHAN ALANKAMONY) /ACCOUNTANT MEMBER ( . . ) (S.S. GODARA) ! /JUDICIAL MEMBER DATED: 13TH JUNE, 2014. K.V ,-. & /'01 2-1#' /COPY TO: 1. 34/PETITIONER 2. /:34 / RESPONDENT 3. $ ;' ( )/CIT(A) 4. $ ;' /CIT 5. 1'<= /'> /DR 6. =? @% /GF. MP NOS.68 & 69/MDS/2014 IN ITA NOS.701 & 702 /MDS/2013 :- 6 -: