ITO, Hyderabad v. Smt Uma Bai Badrinath, Hyderabad

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A HYDERABAD BEFORE SHRI N.R.S. GANSAN JUDICIAL MEMBER AND SHRI CHANDRA POOJARI ACCOUNTANT MEMBER ITA.1075/HYD/2008 A.Y. 2004-05 ITO WARD 7 (1) HYDERABAD VS SMT. UMA BAI BADRINATH HYDERABAD (PAN AHXPB 0005 B) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI H. PHANI RAJU DR RESPONDENT BY : SHRI K.C. DEVADAS O R D E R PER: CHANDRA POOJARI ACCOUNTANT MEMBER THIS APPEAL PREFERRED BY THE REVENUE IS DIRECTED AG AINST THE ORDER PASSED BY THE CIT(A)-VI DATED 14.3.2008 AND PER TAINS TO THE ASSESSMENT YEAR 2004-05. 2. THE REVENUE RAISED THE FOLLOWING GROUNDS: 1. THE CIT(A) ERRED IN FACTS AND IN LAW IN ESTIMA TING THE FAIR MARKET VALUE OF LAND AS ON 1.4.1981 AT RS.300/- PER SQ. YARD. A AGAINST RS.60/- ADOPTED BY THE ASSESSING OFFICER WHICH WAS BASED ON THE CERTIF ICATE ISSUED BY THE SUB REGISTRAR. 2. THE CIT(A) ERRED IN FACTS AND IN LAW IN DIRECTI NG TO ALLOW DEDUCTION ON ACCOUNT OF INDEXED COST OF CONSTRUCTION OF GROUND F LOOR AND FIRST FLOOR WHEREAS IN THE SCHEDULE OF PROPERTY TRANSFERRED TO THE BUIL DER BY THE ASSESSEE FOR DEVELOPMENT THERE IS NO MENTION OF ANY PRE EXISTING STRUCTURE TO BE HANDED OVER TO THE BUILDER. 3. THE CIT(A) ERRED IN FACTS AND IN LAW IN RELYIN G ON THE DECISION IN THE CASE OF MADHURA COASTS LTD. VS. CIT(279 ITR 493) AS THE FACTS OF THE CITED CASE RELATE TO TRANSFER OF SHARES OF A NEW COMMERCI AL FIRM ON AMALGAMATION AND NOT ON TRANSFER OF PROPERTY ASSOCIATED WITH DEV ELOPMENT. 4. THE CIT(A) ERRED IN FACTS AND IN LAW IN IGNORI NG THAT THE EXEMPTION CLAIMED U/S 54F BY THE ASSESSEE WAS WITH REGARD TO REINVESTMENT IN PURCHASE OF TWO FLATS IN THE FIFTH FLOOR AGGREGATING TO 4 1 10 SQ.FT. WITH TWO DISTRICT 2 2 MUNICIPAL NUMBERS WHEREAS EXEMPTION U/S 54F IS TO BE RESTRICTED TOP REINVESTMENT OF SALE PROCEEDS IN PURCHASE OF ONE RE SIDENTIAL PROPERTY ONLY. 5. THE CIT(A) ERRED IN FACTS AND IN LAW IN DIRECT ING TO ALLOW EXEMPTION U/S 54F IN RESPECT OF TWO FLATS BASING ON THE SUBMISSIO NS OF THE ASSESSEE AND WITHOUT ANY EVIDENCE ON RECORD WHETHER THE TWO FLAT S WERE PUT TO USE AS ONE RESIDENTIAL UNIT OR NOT. 6. THE CIT(A) ERRED IN FACTS AND IN LAW IN DIRECT ING TO ALLOW RS.4.5 LAKHS INCURRED TOWARDS MAKING THE FLATS HABITABLE WHILE CALCULATING THE EXEMPTION U/S 54F WITHOUT ANY MATERIAL EVIDENCE. 3. DURING THE COURSE OF HEARING THE DEPARTMENTAL REPRESENTATIVE FILED ADDITIONAL GROUNDS STATING THAT THE CIT(A) HAS ERRED IN ALLOWING ADDITIONAL EVIDENCES FILED BY THE ASSESSEE WH ICH WERE NOT PRODUCED BY THE ASSESSEE BEFORE THE ASSESSING OFFICER AND WIT HOUT GIVING OPPORTUNITY TO THE ASSESSING OFFICER TO VERIFY TH E SAME IN CONTRAVENTION OF RULE 46A. 4. FURTHER THE DEPARTMENTAL REPRESENTATIVES PLEAD ED TO ADMIT THE ADDITIONAL GROUND AND TO SET ASIDE THE ISSUE TO TH E FILE OF THE LOWER AUTHORITIES FOR FRESH ADJUDICATION IN VIEW OF THE JUDG EMENT OF MADHYA PRADESH HIGH COURT IN THE CASE OF CIT VS. TOLLARAM HASSOMAL (MP): (298 ITR 22). 5. ON THE OTHER HAND THE AUTHORIZED REPRESENTATIV E STRONGLY OPPOSED THE ADMISSION OF THE ADDITIONAL GROUND AND SUB MITTED THAT NO USEFUL PURPOSE WILL BE SERVED BY SETTING ASIDE THE ISSUE TO THE FILE OF THE LOWER AUTHORITIES. 6. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE M ATERIAL AVAILABLE ON RECORD AND ALSO ON THE ISSUE RELATING TO A DMISSION OF ADDITIONAL GROUNDS. THE ASSESSEE OBTAINED A COPY OF THE DOCUMENT FROM THE SUB REGISTRAR OFFICE PERTAINING TO A TRANSACTION TH AT TOOK PLACE IN SHANTINAGAR AND PRODUCED BEFORE THE CIT(A) DURING TH E COURSE OF APPELLATE PROCEEDINGS. ACCORDING TO THIS TRANSACTION TH E LAND PRICE IN 3 3 SHANTINAGAR WAS RS.141/- PER. S. YARDS IN MARCH 1975. IN VIEW OF THIS THE ASSESSING OFFICER HAD NO OCCASION TO CONSIDER THE SA ME. IN THE INTEREST OF JUSTICE WE FEEL IT FAIR TO SET ASIDE TH E ISSUE TO THE FILE OF ASSESSING OFFICER FOR FRESH CONSIDERATION AFTER GIVING AN O PPORTUNITY OF HEARING TO THE ASSESSEE. ACCORDINGLY WE SET ASIDE THE ENT IRE ISSUE IN APPEAL TO THE FILE OF ASSESSING OFFICER TO CONSIDER THE EN TIRE ISSUE AFRESH. 7. IN THE RESULT THE APPEAL OF THE REVENUE IS ALLO WED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT : 30 .4.201 0 SD/- SD/- N.R.S. GANESAN CHANDRA POOJARI JUDICIAL MEMBER ACCOUNTANT MEMBER DATED THE APRIL 2010 COPY FORWARDED TO: 1. SMT. UMA BAI BADRINATH 10-2-289/8 502 JYOTHI N ITYA SHREE APARTMENTS SHANTINAGAR HYDERABAD 2. UTI WARD 7 (1) HYDERABAD. 3. CIT(A)-VI HYDERABAD. 4. CIT HYDERABAD 5. THE D.R. ITAT HYDERABAD. NP