WEALTH TAX OFFICER, Jaipur V. KUSHAL CHAND SURANA, Jaipur

WTA 24/JPR/2000

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 3568 (ITAT-JAIPUR)
• Duration Of Justice: 19 year(s) 3 month(s) 28 day(s)
• Appeal Type: Income Tax (International Taxation) Appeal
• Pronouncement Date: 29-04-2019
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: misc
• Appeal Filed On: 01-01-2000
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: PRITHVI RAJ MEENA
• Assessee Lawyers: SITA RAM SHARMA CA DHK
• Keywords: Fair market value; Valuation report; Revised return; Set aside

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR JH DQY HKKJR] U;KF;D LNL; ,OA JH FOE FLAG ;KNO] YS [KK LNL; DS LE{K BEFORE: SHRI KUL BHARAT, JM & SHRI VIKRAM SINGH YAD AV, AM VK;DJ VIHY LA-@ WTA NO. 24/JP/2000 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 1980-81. THE WEALTH TAX OFFICER, WARD 2(4), JAIPUR. CUKE VS. SHRI KUSHAL CHAND SURANA, LAL KATRA, JOHARI BAZAR, JAIPUR. JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN NO. VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT JKTLO DH VKSJ LS@ REVENUE BY : SHRI PRITHVIRAJ MEENA (ADDL. CIT) FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI SITA RAM SHARMA (CA) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 28.02.2017. ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 28/02/2017. VKNS'K@ ORDER PER SHRI KUL BHARAT, JM. THIS APPEAL BY THE REVENUE IS FIXED FOR HEARING IN PURSUANCE OF THE ORDER DATED 23.08.2016 OF HONBLE JURISDICTIONAL HIGH COU RT TO DECIDE THIS APPEAL AS PER THE DIRECTIONS GIVEN IN THE CASE OF PRAKASH CHAND S URANA. IN THE CASE OF PRAKASH CHAND SURANA, THE HONBLE HIGH COURT HAS DIRECTED T HE TRIBUNAL AS UNDER :- IN THAT VIEW OF THE MATTER, SO FAR AS FIRST QUES TION IS CONCERNED, WE HAVE NO HESITATION IN COMING TO THE CONCLUSION THAT THE TRIBUNAL HAS NOT ERRED IN REFUSING TO DECIDE THE QUESTION OF FAC T RELATING TO VALUATION OF PROPERTY IN QUESTION BY APPLYING THE RATES PRESC RIBED UNDER THE STANDING ORDER X-3 ISSUED BY PWD BY WAY OF STRAIGHT JACKET FORMULA FOR VALUING THE PROPERTY IN QUESTION. HOWEVER, THE QUESTION FURTHER ARISES ON ACCEPTING T HE PRINCIPLE SET OUT BY THE TRIBUNAL ITSELF WHAT SHOULD HAVE BEEN NEXT S TEP. IF THE PRINCIPLE SET OUT BY THE TRIBUNAL IS ACCEPTED TO BE CORRECT, THEN IT WAS FOR THE 2 WTA NO. 24/JP/2000 SHRI KUSHAL CHAND SURANA TRIBUNAL AS A FINAL FACT FINDING AUTHORITY, TO HAVE CONSIDERED ALL THE RELEVANT ASPECTS AND CONTENTIONS RAISED BY THE ASSE SSEE ABOUT THE CHALLENGE TO VALUATION MADE BY THE WEALTH TAX OFFIC ER AND RECORDED HIS OWN FINDING. WE ARE NOT PRESENTLY CONCERNED THA T WHAT COULD HAVE BEEN THE ULTIMATE FINDING. THAT HAS TO BE RECORDED BY A SPEAKING ORDER BY THE TRIBUNAL. HOWEVER, THE ORDER OF TRIBUNAL UNDER CHALLENGE SHOW S THAT THE MATERIAL, WHICH WAS PLACED ON RECORD, HAS NOT BEEN CONSIDERED BY THE TRIBUNAL, WHICH OUGHT TO HAVE BEEN CONSIDERED BY TH E TRIBUNAL IN THE CONTEXT OF THE VALUATION REPORT SUBMITTED ON RECORD BEFORE REACHING ITS CONCLUSION. APPARENTLY, THE TRIBUNAL, AS A FINAL FA CT FINDING AUTHORITY, HAS FAILED TO DISCHARGE ITS FUNCTIONS AND HAS FALLE N INTO SAME ERROR AFTER SETTING OUT THE LAW CORRECTLY TO WHICH THE CIT (APP EAL) HAS FALLEN. THE FINDING RECORDED BY THE WEALTH TAX OFFICER HAS BEEN RESTORED MECHANICALLY WITHOUT EXAMINING ITS VALIDITY IN THE LIGHT OF CONTENTION RAISED BY THE ASSESSEE AND WITHOUT CONSIDERING THE MATERIAL THAT WAS ON RECORD. THE TRIBUNAL WAS NOT RIGHT IN ADOPTING THE COURSE OF RESTORING THE ORDER PASSED BY THE WEALTH TAX OFFICE R IPSO FACTO AS A RESULT OF SETTING ASIDE THE ORDER OF THE CIT (APPEA LS) WITHOUT UNDERTAKING THE EXERCISE AS A FINAL FACT FINDING AU THORITY AND WITHOUT CONSIDERING THE CONTENTION RAISED BY THE ASSESSEE A BOUT THE VALUATION REPORT SUBMITTED BEFORE IT AND RECORDED ITS FINDING . CONSEQUENTLY, THE APPEAL IS ALLOWED. THE ORDER OF T HE TRIBUNAL IS SET ASIDE AND THE TRIBUNAL IS DIRECTED TO CONSIDER THE VALUATION OF THE PROPERTY IN QUESTION IN ACCORDANCE WITH THE PRINCIP LES SET OUT BY ITSELF BY TAKING INTO CONSIDERATION THE MATERIAL WHICH IS ALREADY ON RECORD AND CONSIDERING THE CONTENTION RAISED BY THE RIVAL PARTIES AND PASS THE APPROPRIATE ORDERS AS IT THINKS FIT. 2. THE CASE BEING VERY OLD, THE CASE FILE WAS GOT R ECONSTRUCTED WITH THE HELP OF RESPECTIVE REPRESENTATIVES OF BOTH THE PARTIES. 3. AT THE TIME OF HEARING, THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT UNDER THE INSTRUCTION OF THE ASSESSEE EVEN IF THE FINDING OF THE AO IS RESTORED, HE WOULD HAVE NO GRIEVANCE. 3.1. THE LD. D/R HAS NO OBJECTION IN THIS REGARD. 3 WTA NO. 24/JP/2000 SHRI KUSHAL CHAND SURANA 3.2. WE HAVE HEARD THE RIVAL CONTENTION AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THE AO DECIDED THE ISSUE BY FO LLOWING THE VALUATION DETERMINED BY THE DEPARTMENTAL VALUATION OFFICER. THE AO HAD DECIDED THE TAX LIABILITY OF THE ASSESSEE AS UNDER :- I HAVE CONSIDERED THE REPLY OF THE ASSESSEE, BUT AM NOT CONVINCED. THE DEPARTMENTAL VALUER VIDE HIS REPORT DATED 22.7. 83 HAS CONSIDERED THE OBJECTIONS RAISED BY ASSESSEE. IN THE CIRCUMSTA NCES, THE ASSESSEES INTEREST IN THE FIRM OF M/S. SURANA ENTERPRISES IS WORKED OUT AS UNDER AND VALUE OF RAJ MANDIR CINEMA AS DETERMINED BY THE DEPARTMENTAL VALUATION OFFICER IS ADOPTED IN VIEW OF MANDATORY P ROVISIONS OF SECTION 7(3) OF THE W.T. ACT. VALUE OF ASSETS VIZ. RAJ MANDIR CINEMA BUILDING & MACHINERY CONSISTING OF AIR CONDITIONING & COOLING PLANT, PROJECTOR MACHINES & EQUIPMENT, PASSENGER LIFT, OTHER MACHINES, FURNITURE & FITTING. AUDITORIUM CHAIRS & FIXTURES, RESTAURANT ASSETS, COOLER & FREEZER AS WORKED OUT THE DEPARTMENTAL VALUATION OFFICER AS PER HIS REPORT MENTIONED ABOVE. 1,11,47,000 VALUE OF BUILDING & MACHINERY AS PER BALANCE SHEET OF THE FIRM AS PER DETAILS SHOWN BELOW : LAND & BLDG. 22,31,310 AIRCONDITIONING & COOLING PLANT 4,16,840 PROJECTOR MACHINES & EQUIPMENT 1,59,629 PASSENGER LIFT 51,458 OTHER MACHINES 20,981 FURNITURE & FIXTURE 8,89,065 AUDITORIUM CHAIRS & FIXTURES 1,01,410 RESTAURANT ASSETS COOLER & FREEZER 8,099 ------------- 38,78,792 ---------------- DIFFERENCE 72,68,208 4 WTA NO. 24/JP/2000 SHRI KUSHAL CHAND SURANA ASSESSEES SHARE @ 25% IN THE ABOVE DIFFERENCE 18,17,052 ADD: CAPITAL IN CAPITAL A/C. 20,000 ------------ 18,37,052 LESS: DEBIT BALANCE WITH M/S. SURANA ENTERPRISES 5,86,834 _______ 12,50,218 I, THEREFORE, ADOPT THE INTEREST IN PARTNERSHIP AS WORKED OUT ABOVE I.E. RS. 12,50,218/- INSTEAD OF RS.(-) 4,75,712/- SHOWN BY THE ASSESSEE IN THE REVISED RETURN. VALUE OF JEWELLERY IS SHOWN AT RS. 90,000/-. LAST Y EAR JEWELLERY WAS ASSESSED AT RS. 89,000/-. THE VALUE OF GOLD WHICH W AS RS. 870/- PER 10 GM. ON THE LAST VALUATION DATE ROSE TO RS. 1220/- P ER 10 GM ON THE PRESENT VALUATION DATE. CONSIDERING THE INCREASE IN PRICE OF GOLD, FAIR MARKET VALUE OF JEWELLERY IS ESTIMATED AT RS. 1,30, 000/- AS AGAINST RS. 90,000/- SHOWN BY THE ASSESSEE. THE ASSESSEE HAS SHOWN THE VALUE OF 12 KG SILVER UT ENSILS AT RS. 24,000/-. MARKET RATE OF SILVER UTENSILS ON THE REL EVANT VALUATION DATE WORKS OUT TO RS. 27,000/- AS AGAINST RS. 24,000/- S HOWN BY THE ASSESSEE AT THE RATE O RS. 2283/- PER KG. WITH THESE REMARKS, TOTAL WEALTH IS COMPUTED AS UND ER :- IMMOVABLE PROPERTY : DEPOSITS M/S. KUSHAL & PRAKASH 66,342 M/S. BHURAMAL RAJMAL SURANA (MFGS.) 50,873 1,17,215 INTEREST IN THE FIRM OF M/S. SURANA ENTERPRISES AS WORKED OUT ABOVE 12,50,218 JEWELLERY AS DISCUSSED ABOVE 1,30,000 SILVER UTENSILS AS DISCUSSED ABOVE 27,000 CASH AS SHOWN 500 15,24,933 LESS : W.T. LIABILITY 28,640 NEW WEALTH : 14,96,293 5 WTA NO. 24/JP/2000 SHRI KUSHAL CHAND SURANA SINCE THE ASSESSEE HAS NO GRIEVANCE NOW ABOUT THE O RDER OF THE AO, WE SET ASIDE THE ORDER AS CHALLENGED BY THE REVENUE AND ACCORDIN GLY RESTORE THE FINDING OF THE A.O. 4. IN THE RESULT, APPEAL OF THE REVENUE IS ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON 28/02/201 7. SD/- SD/- FOE FLAG ;KNO ( DQY HKKJR ) (VIKRAM SINGH YADAV) ( KUL BHARAT ) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER JAIPUR DATED:- 28/02/2017. D/ VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT- THE WTO WARD 2(4), JAIPUR. 2. THE RESPONDENT- SHRI KUSHAL CHAND SURANA, JAIPUR . 3. THE CIT, 4. THE CIT (A) 5. THE DR, ITAT, JAIPUR 6. GUARD FILE WTA NO.24/JP/2000) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR 6 WTA NO. 24/JP/2000 SHRI KUSHAL CHAND SURANA