Sujatha Atchutani , Hyderabad v. Dy. Commissioner of Income Tax , Circle-6(1), Hyderabad

ITA 1208/Hyd/2018 | 2011-2012
Pronouncement Date: 27-11-2019 | Result: Allowed

Appeal Details

RSA Number 120822514 RSA 2018
Assessee PAN ABBPA8757E
Bench Hyderabad
Appeal Number ITA 1208/Hyd/2018
Duration Of Justice 1 year(s) 5 month(s) 19 day(s)
Appellant Sujatha Atchutani , Hyderabad
Respondent Dy. Commissioner of Income Tax , Circle-6(1), Hyderabad
Appeal Type Income Tax Appeal
Pronouncement Date 27-11-2019
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted DB-B
Tribunal Order Date 27-11-2019
Date Of Final Hearing 18-11-2019
Next Hearing Date 18-11-2019
Last Hearing Date 18-11-2019
First Hearing Date 30-11-2018
Assessment Year 2011-2012
Appeal Filed On 08-06-2018
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B ' HYDERABAD BEFORE S MT. P. MADHAVI DEVI JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY ACC O UNTANT MEMBER I TA NO . 1 208 / HYD/201 8 A SSESSMENT Y EAR : 20 1 1 - 12 S UJATHA ATCHUTANI HYDERABAD. PAN A BBPA 8757E VS. DY. COMMISSIONER OF INCOME - TAX CIRCLE 6(1) HYDERABAD. APPELLANT RESPONDENT ASSESSEE BY: S H RI M. NAGA DEEPAK REVENUE BY: SHRI RAJAT MITRA DATE OF HEARING: 18 / 11 / 201 9 DATE OF PRONOUNCEMENT: 27 / 1 1 /201 9 O R D E R PER P. MADHAVI DEVI J.M.: THIS IS AN APPEAL OF THE ASSESSEE AGAINST THE ORDER OF CIT(A) 6 HYDERABAD DATED 12/02/2018 FOR AY 2011 - 12. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE AN INDIVIDUAL DERIVING INCOME FROM CAPITAL GAINS AND OTHER SOURCES FILED HER RETURN OF INCOME FOR THE AY 2011 - 12 ON 31/07/2011 ADMITTING TAXABLE INCOME AT RS. 24 62 710. DURING THE ASSESSMENT PROCEEDINGS U/S 143(3) OF THE ACT THE ASSESSEE SUBMITTED THAT SHE HAS FAILED TO ADMIT INCOME FROM HOUSE PROPERTY AMOUNTING TO RS. 44 000/ - AND ACCORDINGLY OFFERED THE SAME TO TAX. T HE AO ADDED THE SAME AFTER ALLOWING 30% OF STANDARD DEDUCTION AND MADE ADDITION OF RS. 30 800/ - . I.T.A. NO. 1208 / H/1 8 S UJATHA ATCHUTANI HYD. 2 2.1 THE AO ALSO OBSERV ED THAT THE ASSESSEE HAS ADMITTED THE SHORT TERM CAPITAL GAINS (STCG) OF RS. 11 21 991/ - FROM THE SALE OF INHERITED PROPERTY AT GUNTUR . THE DETAILS OF THE TRANSACTIONS WERE CALLED FOR AND THE ASSESSEE VIDE LETTER DATED 20/10/2013 SUBMITTED THE DETAILS REGA RDING SALE OF TWO PROPERTIES ONE AT GUNTUR AND THE OTHER AT HYDERABAD AND ALSO INVESTMENT IN HOUSE PROPERTY AT HYDERABAD. THE AO OBSERVED THAT ASSESSEE HAS FILED REVISED COMPUTATION VIDE LETTER DATED 13/11/2013 WHEREIN INCOME OTHER THAN CAPITAL GAINS WAS C OMPUTED AT RS. 13 71 516/ - AND LONG TERM CAPITAL GAINS (LTCG) AT RS. 3 86 678/ - . FURTHER VIDE LETTER DATED 19/11/2013 ASSESSEE ALSO EXPLAINED THE REASONS THAT LED TO CERTAIN ERRORS IN THE COMPUTATION AND REQUESTED TO TAKE THE COMPUTATION FILED ON 14/11/2 013 INTO ACCOUNT AND ISSUE THE RESULTANT REFUND. THE AO HOWEVER OBSERVED THAT THE ASSESSEES CLAIM OF LTCG OF RS. 3 86 678/ - INSTEAD OF STCG OF RS. 11 21 991/ - OFFERED IN THE RETURN OF INCOME IS NOT VALIDATED BY A REVISED RETURN. HE THEREFORE DID NOT E NTERTAIN THE CLAIM BY FOLLOWING THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF GOETZE (INDIA) LTD. VS. CIT [2006] 284 ITR 323. HE THEREFORE COMPUTED THE TAXABLE INCOME OF THE ASSESSEE AT RS. 24 93 510/ - BY ADDING THE INCOME FROM HOUSE PROPERT Y OF RS. 30 800/ - TO THE RETURNED INCOME OF THE ASSESSEE OF RS. 24 6 2 710/ - AND BROUGHT IT TO TAX. 3. AGGRIEVED ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT(A) WHO ACCEPTED THE ASSESSEES CONTENTION THAT THE ASSESSEE HAS INHERITED THE PROPERTY AT GUNTUR AND THE GAIN ON SALE OF SUCH PROPERTY IS LTCG AND NOT STCG AS DISCLOSED BY THE ASSESSEE IN THE ORIGINAL RETURN OF INCOME. 3.1 FURTHER THE GAIN ON SALE OF PROPERTY AT HYDERABAD WAS ALSO ACCEPTED BY THE CIT(A) TO BE LTCG BUT HELD THAT SRO I.T.A. NO. 1208 / H/1 8 S UJATHA ATCHUTANI HYD. 3 VALUE OF THE PROPERTY IS TO BE TAKEN AS SALE CONSIDERATION U/S 50C AND LTCG SHOULD BE COMPUTED ACCORDINGLY . THEREFOR E HE ISSUED A NOTICE FOR ENHANCEMENT OF THE LTCG ON ACCOUNT OF SALE OF GUNTUR PROPERT Y AS ACCORDING TO HIM THE COST OF ACQUISITION HAS BEEN WRONGLY COMPUTED AND ALSO FOR ADOPTING SRO VALUE IN RESPECT OF HYDERABAD PROPERTY. AFTER HEARING THE ASSESSEE HE COMPUTED THE LTCG ON SALE OF GUNTUR PROPERTY AT RS. 33 22 679/ - AND ON SALE OF HYDERABAD PROPERTY AT RS. 11 43 849/ - AND THEREAFTER ALLOWED THE CLAIM OF EXEMPTION U/S 54 OF THE ACT TO THE EXTENT OF RS. 34 50 250/ - . AGAINST THIS ORDER THE ASSESSEE IS IN APPEAL BEFORE US BY RAISING THE FOLLOWING GROUNDS OF APPEAL: 1. THE ORDER ITA NO. 1181/2014 - 15/132/CIT(A) - 6 DATED 1 2/02/2018 OF THE CIT(A) FOR THE AY 2011 - 12 IS CONTRARY TO LAW FACTS WITHOUT FULLY APPRECIATING THE FACTUAL AND THE LEGAL POSITION IN THE PROPER PERSPECTIVE AND IN THE CIRCUMSTANCES OF THE CASE. 2. THE LEARNED CIT (APPEALS - 6) HAS ERRED IN ENHANCING TH E ASSESSMENT TO THE EXTENT OF RS. 10 16 278/ - UNDER THE DEEMED PROVISIONS OF SECTION 50C OF INCOME TAX ACT ON THE GROUND OF NON - DISCLOSURE OF CAPITAL GAINS IN THE RETURNS WHICH WAS NOT THE SUBJECT MATTER OF APPEAL BEFORE HIM. 3. THE LEARNED CIT (APPEAL S) HAS FAILED TO FOLLOW THE SETTLED PRINCIPLE THAT LEGAL FICTIONS ARE ONLY FOR A DEFINITE PURPOSE AND THEY ARE LIMITED TO THE PURPOSE FOR WHICH THEY ARE CREATED AND SHOULD NOT BE EXTENDED BEYOND THAT LEGITIMATE FIELD. 4. THE LEARNED CIT (A) IGNORED THE F ACT THAT DEEMED PROVISIONS UNDER SEC. 5 OC HAVE BEEN RECEIVED BY THE TRANSFEROR IS FOR THE LIMITED PURPOSE OF COMPUTATION OF CAPITAL GAIN U/S 48 AND INVESTMENT OF ACTUAL SALE PROCEEDS NOT DEEMED CONSIDERATION U/S 50C RELEVANT FOR EXEMPTION U/S 54. 5 . THE L EARNED C IT (A) WOULD HAVE BEEN GIVEN A SQUARE DEA L TO APPELLANTS ABOUT THEIR 'BONA FIDE/INADVERTENT / HUMAN ERROR/ MERE OMISSION IN THE RETURN OF INCOME FOR NOT CLAIMING EXEMPTION UNDER SECTION 54 ON HYDERABAD PROPERTY IN TERMS OF C B DT CIRCULAR NO. 14(XL - 35) DATED 11.04.1955. I.T.A. NO. 1208 / H/1 8 S UJATHA ATCHUTANI HYD. 4 6 . THE LEARNED CIT (A) HAS TAKEN ADVANTAGE OF MISTAKE IS COMMITTED DUE TO PROFESSIONAL ADVICE/A.R MISS REPRESENTATION CONSIDERING ONLY LAND VALUE AS ON 01.04.1981 AND DID NOT INCLUDE THE CONSTRUCTION VALUE AND ADDITIONS FOR INHERITED GUNTUR PROPERTY. 7 .THE LEARNED CI T(A) HAS ERRED ON THE FACT THAT THE GOVERNMENT OF ANDHRA PRADESH HAS SUBSTANTIALLY INCREASED THE FAIR MARKET VALUE OF THE PROPERTY FOR LEVY OF STAMP DUTY INCREASED WITHIN A SHORT SPAN OF 1 MONTH FOR HYDERABAD PROPERTY DURING THE MATERIAL PERIOD. 8 .THE LE ARNED CIT (A) IGNORED THE FACT THAT A.O. REJECTED REVISED COMPUTATIONS OF THE APPELLANT WOULD HAVE BEEN GIVEN A SQUARE DEAL FROM THE DEPARTMENT ON THE BASIS OF CBDT CIRCULAR NO.114 XL - 35 OF 1955 DATED 11.05.1955 9 . THE LEARNED CIT(A) FAILED TO APPRECIAT E THAT HAVING REGARD TO LAW AND THE FACTS OF THE CASE THE APPELLANT HAS NOT COMMITTED ANY CONCEALMENT OF INCOME IN TERMS OF SECTION 271(1)(C) OF THE 1. T. ACT 1961 10 . THE APPELLANT CRAVES LEAVE TO FILE ADDITIONAL GROUNDS/ARGUMENTS AT THE TIME OF HEARIN G. 4. LD. COUNSEL FOR THE ASSESSEE WHILE REITERATING THE SUBMISSIONS MADE BEFORE THE AUTHORITIES BELOW SUBMITTED THAT THE PROPERTY AT GUNTUR WAS NOT AN OPEN PLOT BUT THERE WAS A STRUCTURE THEREON BUT THE CIT(A) WHILE COMPUTING INDEXED COST OF ACQUIS ITION HAS CONSIDERED THE VALUE OF PLOT ONLY AND HAS NOT GIVEN ANY WEIGHTAGE TO THE BUILDING THEREON. THEREFORE ACCORDING TO H IM COMPUTATION OF COST OF ACQUISITION IS ERRONEOUS . THUS HE SUBMITTED THAT THE ISSUE SHOULD BE SET ASIDE TO THE FILE OF AO FOR R ECOMPUTING THE COST OF ACQUISITION WITH RESPECT TO GUNTUR PROPERTY AND EXEMPTION U/S 54 SHOULD BE ALLOWED TO T HAT EXTENT AS WELL . 5. LD. DR WAS ALSO HEARD. 6. HAVING REGARD TO THE FACTS OF THE CASE AND MATERIAL ON RECORD IT IS OBSERVED THAT CIT(A) HAS ACCEPTED THE CAPITAL I.T.A. NO. 1208 / H/1 8 S UJATHA ATCHUTANI HYD. 5 GAIN ON SALE OF GUNTUR PROPERTY TO BE LTCG . HAVING HELD SO HE OUGHT TO HAVE CORRECTLY COMPUTED THE COST OF ACQUISITION WITH THE VALUE OF LA ND AS WELL AS BUILDING THEREON. SINCE THE VALUE OF THE BUILDING HAS NOT BEEN CONSIDERED AS COST OF ACQUISITION WE DEEM IT FIT AND PROPER TO REMAND THE ISSUE TO THE FILE OF THE AO WITH A DIRECTION TO RECOMPUTE THE CAPITAL GAINS ON SALE OF GUNTUR PROPERTY BY TAKING INTO CONSIDERATION THE VALUE OF THE LAND AS WELL AS THE BUILDING THEREON AND EXEMPTIO N U/S 54 SHALL BE ALLOWED ON SUCH LTCG. ACCORDINGLY THE GROUNDS RAISED BY THE ASSESSEE ON THIS ISSUE ARE TREATED AS ALLOWED FOR STATISTICAL PURPOSES. 7. IN TH E RESULT APPEAL OF THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON 27 TH N OVEMBER 201 9. SD/ - (A. MOHAN ALANKAMONY) ACCOUNTANT MEMBER SD/ - ( P. MADHAVI DEVI ) JUDICIAL MEMBER HYDERABAD DATED 27 TH NOVEMBER 201 9. KV COPY FORWARDED TO: 1. MRS. SUJATA ATCHUTANI NO. 8 - 2 - 293/82/A/743 ROAD NO. 38 JUBILEE HILLS HYDERABAD 500 0 33 2 . DC IT CIRCLE - 6 ( 1 ) HYDERABAD 3 . CIT ( A ) 6 HYDERABAD 4. PR. CIT - 6 HYDERABAD. 5. THE DR ITAT HYDERABAD 6. GUARD FILE I.T.A. NO. 1208 / H/1 8 S UJATHA ATCHUTANI HYD. 6