Shri Niresh Khandelwal, Indore V. The ACIT 1(2), Indore

MA 9/IND/2014

• Counselvise Citation: [2015] 124 COUNSELVISE.COM (IT) 3008 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 2 month(s) 19 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 17-04-2015
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2008-2009
• Appeal Filed On: 29-01-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: R A VERMA
• Assessee Lawyers: S S DESHPANDE
• Keywords: Sale consideration of property below Jantri Value; Cost of acquisition; Valuation report
• Section: 50C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE BEFORE SHRI D.T. GARASIA, J.M. AND SHRI B.C.MEENA, A.M. MISC. APPLICATION NO. 09/IND/2014 (ARISING OUT OF I.T.A.NO. 435/IND/2013 - A. Y. 2008-09) SHRI NIRESH KHANDELWAL, INDORE. APPLICANT VS. ACIT, 1(2), INDORE. RESPONDENT PAN NO. : AMAPK1791J APP LICANT BY : SHRI S.S.DESHPANDE, C. A. RESPONDENT BY : SHRI R.A.VERMA, SR. DR DATE OF HEARING : 17 . 04 .201 5 DATE OF PRONOUNCEMENT : 17 . 04 .201 5 O R D E R PER GARASIA, J.M. THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF CIT(A) DATED 7.12.2007 FOR THE ASSESSMENT YEAR 2 004-05. -: 2: - 2 2. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED MISCELLANEOUS PETITION, WHICH READS AS UNDER :- THE PETITIONER IS AN INDIVIDUAL DERIVING INCOME FROM BUSINESS, INTEREST BESIDES THE CAPITAL GAINS ON SALE OF LAND. THE ASSESSEE HAD RAISED FOLLOWING GROUNDS BEFORE THE HON'BLE TRIBUNAL :- 1. THE LD. CIT(A) HAS ERRED IN MAINTAINING THE CAPITAL GAINS OF RS. 1,71,06,750/- FROM SALE OF PLOT BY APPLYING SECTION 50C OF THE ACT, BY TAKING THE SALE CONSIDERATION ON THE BASIS OF VALUATION DONE BY THE LD. VALUATION OFFICER. 2. COMPLETE DETAILS ABOUT THE SALES WERE FILED BEFORE THE LD. AO AND BEFORE THE LD. CIT(A) AND IT WAS PROVED THAT THE LD. VO DID NOT CONSIDER THE OBJECTIONS RAISED BEFORE HIM WHILE REDUCING THE RATE BY ONLY 5 %. 3. THE LD. CIT(A) HAS ERRED IN NOT ACCEPTING THE VALUE DECLARED BY THE ASSESSEE AS ON 1.4.1981 AND IN RELYING ON THE VALUATION REPORT OF THE LD. -: 3: - 3 V.O. WHO DID NOT CONSIDER THE OBJECTIONS BY THE ASSESSEE. THE COMPARABLE SALE QUOTED BY THE LD. VO WERE OF SOUTH TUKOGANJ WHICH WERE MUCH LESS AS COMPARED TO VALUE ON TAGORE MARG. 3.1 THE LD. CIT(A) DID NOT EVEN CONSIDER THE VALUE QUOTED BY THE LD. V.O. FOR VALUATION AS ON 1.4.1981 IN THE CASE OF KANAKMAL KISHANLAL AND WERE COMPARABLE WITH THE PROPERTY OF THE ASSESSEE. THE FIRST TWO GROUNDS WERE IN RESPECT OF CHARGING THE CAPITAL GAINS AND THE VALUE TO BE ADOPTED U/S 50C OF THE ACTG. GROUND NO. 3 WAS IN RESPECT OF VALUE TO BE DETERMINED AS ON 1.4.1981. THE ASSESSEE HAD SHOWN THE VALUE AT RS. . 275/- PR SQ.FT. AS PER VALUATION MADE BY THE APPROVED VALUER. HOWEVER, THE LD. VO VALUED THE SAME AT RS. 66.07 PER SQ.FT. BEFORE THE HON'BLE TRIBUNAL GROUND NO.3 WAS RAISED AND IT WAS ARGUED THAT THE VALUE MAY BE TAKEN AS SHOWN BY THE ASSESSEE AS ON 1.4.1981. -: 4: - 4 THE SAME POINT WAS ALSO TAKEN IN THE WRITTEN SUBMISSIONS MADE BY THE ASSESSEE. THE ASSESSEE ALSO FILED THE ASSESSMENT ORDER PASSED IN THE CASE OF SH KANAKMAL KISHANLAL WHEREIN THE VALUATION WAS GIVEN A ON 1.4.1981 FOR VARIOUS SITES. IN THE ARGUMENTS AND WRITTEN SUBMISSIONS THE CASE OF KRISHNA BAI TINGRE VS. ITO, 103 TTJ 216 WAS CITED. ON THE BASIS OF THIS CASE IT WAS SUBMITTED THAT THE LD. VO HAS NO AUTHORITY TO DETERMINE THE VALUE AS ON 1.4.1981. THUS, THE VALUE ADOPTED ON THE BASIS OF THE REPORT IS ILLEGAL. THE HON'BLE TRIBUNAL IN PARA 3.1 MERELY CONSIDERED THE APPLICATION OF SECTION 50C FOR ADOPTING THE VALUE ON THE DATE OF SALE. THE HON'BLE TRIBUNAL MADE A PASSING REMARK THAT THE VO ADOPTED THE VALUE OF RS. . 66 PER SQ.FT. AS ON 1.4.1981. THE HON'BLE TRIBUNAL HAS DISCUSSED THE VALUE AS ON THE DATE OF SALE AND AFTER OBSERVING THE GUIDELINES OF COLLECTOR ETC. -: 5: - 5 MAINTAINED THE VALUATION AT RS. . 1,94,33,000/-. THE HON'BLE TRIBUNAL, HOWEVER, DID NOT DISCUSS THE VALUE TO BE ADOPTED AS ON 1.4.1981 AND THE COMPARABLE VALUATION GIVEN IN THE ASSESSMENT ORDER OF SH KANAKMAL KISHANLAL. THE HON'BLE TRIBUNAL ALSO DID NOT DISCUSS THE CASE OF KRISHNA BAI TINGRE QUOTED BEFORE IT. IT IS ,THUS, HUMBLY SUBMITTED THAT THE GROUND NO. 3 AND 3.1 REMAINED TO BE DISCUSSED AND ADJUDICATED. THE CASE QUOTED BEFORE THE HON'BLE TRIBUNAL ALSO NEEDS TO BE CONSIDERED. THUS, THERE IS MISTAKE APPARENT FROM THE RECORDS. IT IS THEREFORE HUMBLY PRAYED THAT THE MISTAKE BEING APPARENT FROM THE RECORD MAY PLEASE BE RECTIFIED AND GROUND NOS. 3 AND 3.1 FOR DETERMINING THE VALUE AS ON 1.4.1981 MAY PLEASE BE DECIDED AFTER CONSIDERING THE CASE LAW CITED BEFORE THE HON'BLE BENCH. -: 6: - 6 3. THE LD. AUTHORIZED REPRESENTATIVE SUBMITTED BEFORE US THAT THE TRIBUNAL WHILE DECIDING THE APPEAL, THE IS SUE WAS DISCUSSED AT PAGE 2 OF THE ORDER HAS WRITTEN THAT T HE ONLY GROUND RAISED IN APPEAL PERTAINING TO MAINTAINING C APITAL GAINS OF RS. 1,71,06,750/- OF SALE OF PLOT BY APPLY ING SECTION 50C OF THE ACT TAKING THE SALE CONSIDERATION ON THE BASIS OF VALUATION DONE BY THE VALUATION OFFICER. THE LD. AU THORIZED REPRESENTATIVE SUBMITTED THAT IN THE APPEAL, THE HO N'BLE TRIBUNAL HAS ONLY DECIDED THE ISSUE PERTAINING TO S ECTION 50C OF THE INCOME-TAX ACT, 1961. THE LD. TRIBUNAL FAILE D TO APPRECIATE AND DISCUSS SECTION 55(2) OF THE INCOME- TAX ACT, 1961, WHICH RELATES TO COST OF ACQUISITION AND VALU ATION HAS TO BE ADOPTED AS ON 1.4.1981. NO SPECIFIC FINDING IN R ESPECT OF COST OF ACQUISITION, WHICH WAS CHALLENGED BEFORE TH E TRIBUNAL AND THE TRIBUNAL DID NOT DECIDE THE ISSUE REGARDING VALUATION AS ON 1.4.1981. THEREFORE, THIS MISC. APPLICATION. 4. THE LD. SENIOR D.R. HAS DRAWN OUR ATTENTION TO THE ORDER OF TRIBUNAL ON PAGE 4, PARA 3.1 AND SUBMITTED THAT THE TRIBUNAL HAS SPECIFICALLY HELD THAT THE AO ON THE B ASIS OF -: 7: - 7 VALUATION REPORT SOUGHT FROM GOVERNMENT VALUER, WHO HAS CONSIDERED THE VALUATION DONE BY THE VALUER OF THE ASSESSEE. THE VALUATION OFFICER ADOPTED THE VALUE OF RS. 66/- PER SQ. FT. AS ON 01.04.1981. WHILE ARRIVING AT A PARTICULAR CO NCLUSION, THE SALE INSTANCES OF SOUTH TUKOGANJ WERE CONSIDERE D AND AFTER GIVING THE WEIGHTAGE OF LOCATION AND INDEXATI ON AT 15% PER YEAR, THE VALUE WAS DETERMINED. THE LD. SENIOR D.R. SUBMITTED THAT ONCE THE TRIBUNAL HAS DISCUSSED THE ISSUE RELATING TO VALUE OF PROPERTY AS ON 1.4.1981, IF TH E TRIBUNAL DECIDES THIS ISSUE AFRESH, THEN IT AMOUNTS TO REVIE W OF THE ORDER, WHICH THE TRIBUNAL HAS NO POWER TO REVIEW IT S OWN ORDER. 5. HAVING HEARD BOTH THE PARTIES, LOOKING TO THE FACTS AND CIRCUMSTANCES OF THE CASE, WE FIND THAT THE TRIBUN AL IN PARA 3.1, WHEREIN IT HAS DISCUSSED THE VALUE AS ON 01.04 .1981 BY DISCUSSING THE ISSUE BY OBSERVING AS UNDER :- 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE FACTS , IN BRIEF, ARE THAT THE ASSESSEE IS AN INDIVIDUAL, DECLARED TOTAL INCOME AT RS. 35,51,900/- IN HIS RET URN -: 8: - 8 FILED ON 31.7.1008. THE LD. AO, DURING ASSESSMENT PROCEEDINGS, ASKED THE ASSESSEE TO FURNISH DETAILS/DOCUMENTS IN RESPECT OF PURCHASE AND SALE O F LAND FROM WHICH LONG TERM CAPITAL GAIN WAS OFFERED. THE ASSESSEE VIDE SUBMISSION DT 26.8.2010 FURNISHED THE COPY OF PURCHASE DEED DT 30 TH MARCH, 1971. TO DETERMINE THE VALUE OF LAND AS ON 1.4.1981 THE ASSESSEE OBTAINED VALUATION REPORT FROM THE REGISTERED VALUER WHO ESTIMATED THE LAND AT RS. . 17,57,250/- @ RS. 275/- PER SQ. FT. THE VALUATION REPORT WAS ALSO FURNISHED. THE ASSESSEE ALSO FURNISHED COPY OF SALE DEED DT. 23 RD OCTOBER, 2007, WHEREIN THE TRANSACTION VALUE WAS RS. 1,79,50,000/- AND THE GUIDELINE VALUE FOR STAMP DUTY WAS RS. 2,03,16,000/-. IN ORDER TO DETERMINE THE VALUATION THE VALUATION REPORT OF THE ASSESSEE WAS REFERRED T O THE VALUATION OFFICER ON 1.11.2000. THE VALUATION OFFICER ESTIMATED THE MARKET VALUE AT THE RATE OF R S. 262.62 PER SQ.FT. VIDE REPORT DATED 16.12.2010, THU S ARRIVED AT THE MARKET RATE OF RS. 66.07 PER SQ.FT. VALUING THE LAND AT RS. 4,22,187/- AS ON 1.4.1981. THIS VALUATION WAS PROVIDED TO THE ASSESSEE FOR HIS COMMENTS. THE COMMENTS OF THE ASSESSEE WERE CONSIDERED AND FINALLY ADOPTED THE VALUE AT RS. 4,22,187/-AGAINST THE CLAIM OF LAND AT RS. 17,57,300/- AS ON 1.4.1981. XX XX XX -: 9: - 9 3.1 IF THE OBSERVATION MADE ASSESSMENT ORDER, CONCLUSION DRAWN IN THE IMPUGNED ORDER, ASSERTION MADE BY THE LEARNED RESPECTIVE COUNSEL AND THE MATERIAL AVAILABLE ON RECORD ARE KEPT IN JUXTAPOSIT ION AND ANALYSED, WE NOTE THAT THE ASSESSEE HAS CHALLENGED THE CALCULATION OF CAPITAL GAINS AT RS.1,71,06,750/- FROM THE SALE OF THE PROPERTY BY APPLYING SECTION 50C OF THE ACT. THE UNCONTROVERTED FACT IS THAT SUCH CONCLUSION WAS ARRIVED AT BY THE ASSESSING OFFICER ON THE BASIS O VALUATION REPORT SOUGHT FROM THE GOVERNMENT VALUER WHO CONSIDERED THE VALUATION DONE BY THE VALUER OF THE ASSESSEE ALSO. THE VALUATION OFFICER ADOPTED AT A PARTICULAR CONCLUSION, THE SALE INSTANCES OF SOUTH TUKOGANJ WERE CONSIDERED AND AFTER GIVING THE WEIGHTAGE OF LOCATION AND INDEXATION AT 15% PER YEAR, THE VALUE WAS DETERMINED AT RS.1,94,33,000/- AGAINST THE VALUE ADOPTED BY THE REGISTERING AUTHORITY AT RS. 2,03,16,000/-. THE VALUATION OFFICER ALSO CONSIDERE D THE OBJECTIONS RAISED BY THE ASSESSEE AND THE GUIDELINES FIXED BY THE COLLECTORATE/REGISTERING AUTHORITY. IF COLLECTORATE RATE FOR THE PURPOSES OF STAMP DUTY VALUATION AND OTHER CIRCUMSTANCES ARE KEPT IN RECORD, WE FIND NO INFIRMITY IN THE STAND O F THE LD. CIT(A). IT IS AFFIRMED. -: 10: - 10 6. FROM THE ABOVE PARAGRAPHS OF THE TRIBUNAL, WE AR E OF THE CONSIDERED VIEW THAT THE TRIBUNAL WHILE DECI DING THIS APPEAL HAS GIVEN A PARTICULAR FINDING ON ISSUE REGA RDING THE VALUE ADOPTED AS ON 01.04.1981. THE TRIBUNAL HAS FU RTHER ALSO DISCUSSED THE ISSUE RELATING TO COMPARABLE SALE OF SOUTH TUKOGANJ AND TAGORE MARG. THUS, WE ARE OF THE CONSI DERED VIEW THAT THE TRIBUNAL HAS DEALT WITH THIS ISSUE AN D THE TRIBUNAL HAS ACCEPTED THE VALUATION DONE BY THE REV ENUE AUTHORITIES. ONCE THE TRIBUNAL HAS DECIDED THE ISSU E, THE TRIBUNAL IN THE GUISE OF MISC. APPLICATION CANNOT R EVIEW ITS OWN ORDER. 7. FROM THE ABOVE TWO PARAGRAPHS OF THE TRIBUNAL, WE A RE OF THE VIEW THAT WHILE DECIDING THIS APPEAL, THE TR IBUNAL HAS CONSIDERED THE VALUATION RATE, WHILE ARRIVING AT TH E MARKET RATE AS ON 1.3.1981. THE TRIBUNAL IN ITS ORDER HAS DISCU SSED THE ISSUE HOW THE VALUATION OF THE LAND AS ON 1.4.1981 WAS ARRIVED AT BY THE ASSESSING OFFICER. THE TRIBUNAL IN ITS OR DER HAS CONFIRMED THE ACTION OF THE AO IN ITS ORDER IN PARA 3.1. THEREFORE, ONCE THE ISSUE IS DECIDED BY THE TRIBUNA L AND THE TRIBUNAL HAS CONFIRMED THE ACTION OF AO, NOW ASSESS EE WANTED -: 11: - 11 TO RECTIFY THIS ORDER IN THE GUISE OF MISC. APPLICA TION. THE JURISDICTION OF THE TRIBUNAL U/S 254(2) OF THE INCO ME-TAX ACT, 1961, IS TO RECTIFY ANY MISTAKE APPARENT FROM THE R ECORD. THE TRIBUNAL DOES NOT ENJOY JURISDICTION U/S 254(2), WH ICH IS IN THE NATURE OF REVIEW AND REVERSAL OF ITS OWN DECISION T AKEN ON MERIT AFTER APPRECIATION OF LEGAL AND FACTUAL POSIT ION OF THE CASE. NO SUCH POWERS ARE CONFERRED BY THE ACT ON AN Y AUTHORITY AT CONVENIENCE AND ARBITRARINESS OF THE A UTHORITY THE DECISION ALREADY TAKEN ON MERIT CAN BE REVERSED UND ER THE GUISE OF RECTIFICATION. SUCH PLENARY POWER AND JURI SDICTION FALL BEYOND THE PURVIEW OF SECTION 254(2). THE PROVISION S OF SECTION 254(2) CONTEMPLATE TO RECTIFY ANY MISTAKE A PPARENT FROM RECORD AND NON CONSIDERATION OF ANY ARGUMENTS ADVANCED BY EITHER PARTY FOR ARRIVING AT CONCLUSION IS NOT A N ERROR APPARENT ON RECORD, ALTHOUGH IT MAY BE ERROR OF JUD GMENT AND THE SAME CANNOT BE RECTIFIED U/S 254(2). IT IS WELL SETTLED LEGAL PROPOSITION THAT IN THE GARB OF MISC. APPLICATION F OR RECTIFICATION, THE ASSESSEE CANNOT BE ALLOWED TO RE OPEN THE WHOLE MATTER. IT IS BEYOND THE SCOPE OF SECTION 254 (2). THE INACTIONS OF MANIFEST ERROR, WHICH IS OBVIOUS, CLEA R AND SELF -: 12: - 12 EVIDENT, THUS, THE TRIBUNAL IS NOT COMPETENT TO REC ALL ITS PREVIOUS ORDER AND RE-WRITE THE SAME AGAIN AND REVE RSE THE EARLIER DECISION TAKEN ON MERIT. WHAT CAN BE RECTIF IED U/S 254(2) IS A MISTAKE APPARENT FROM RECORD AND NOT TH E MISTAKE WHICH NEEDS ELABORATE REASONS OR INQUIRY TO ESTABLI SH THE SAME. SIMILARLY, WHEN TWO OPINIONS ARE POSSIBLE, SU CH A SITUATIONS DO NOT FALL UNDER THE PROVISIONS OF SECT ION 254(2). THUS, IT IS CLEAR THAT POWER SO CONFERRED DOES NOT CONTEMPLATE REHEARING, WHICH WOULD HAVE EFFECT OF RE-WRITING AN ORDER, EFFECTING THE MERIT OF THE CASE AS SOUUGHT BY THE A SSESSEE IN THE INSTANT CASE. THERE IS A DIFFERENCE BETWEEN POW ER TO REVIEW AND POWER TO RECTIFY A MISTAKE APPARENT FROM THE RE CORD. IN NUTSHELL, THE SCOPE OF SUCH POWER OF RECTIFICATION IN EXERCISE OF JURISDICTION U/S 254(2) CLEARLY CONTEMPLATE WHAT CA N BE CORRECTED IS AN APPARENT MISTAKE FROM RECORD AND NO T DEALT WITH THE MERITS OF THE CASE AND TO RECALL THE ORDER ON THE BASIS OF TAKING A SECOND OPINION ON MERIT, WHICH IS NOT T HE SCOPE OF SUCH RECTIFICATION. WE GET SUPPORT FROM THE DECISIO N OF JURISDICITONAL HIGH COURT IN THE CASE OF CIT VS. K. D. WIRES LIMITED, 323 ITR 257 (MP). -: 13: - 13 8. IN THE RESULT, THE MISC. APPLICATION IS DISMISSED. THIS ORDER HAS BEEN PRONOUNCED IN THE OPEN COURT ON 17 TH APRIL, 2015. SD/- SD/- (B. C. MEENA) ACCOUNTANT MEMBER ( D.T.GARASIA) JUDICIAL MEMBER DATED :17 TH APRIL, 2015. CPU*174