ACIT, Hyderabad v. Sri Misbahuddin Babukhan, Secunderabad

ITA 143/HYD/2010 | 2005-2006
Pronouncement Date: 16-07-2010 | Result: Partly Allowed

Appeal Details

RSA Number 14322514 RSA 2010
Assessee PAN AEJPK7552E
Bench Hyderabad
Appeal Number ITA 143/HYD/2010
Duration Of Justice 5 month(s) 19 day(s)
Appellant ACIT, Hyderabad
Respondent Sri Misbahuddin Babukhan, Secunderabad
Appeal Type Income Tax Appeal
Pronouncement Date 16-07-2010
Appeal Filed By Department
Order Result Partly Allowed
Bench Allotted B
Tribunal Order Date 16-07-2010
Date Of Final Hearing 08-07-2010
Next Hearing Date 08-07-2010
Assessment Year 2005-2006
Appeal Filed On 28-01-2010
Judgment Text
ITA NO.141-148 & 296-97 SHRI MISBHAUDDIN BABUKHAN & OTHERS SECUNDERABAD 1 INCOME TAX APPELLATE TRIBUNAL HYDERABAD BEHCN ' B' HYDERABAD BEFORE SHRI G.C. GUPTA VICE PRESIDENT AND SHRI CHANDRA POOJARI ACCOUNTANT MEMBER APPELLANT BY : SMT. NIVEDITA BISWAS DR RESPONDENT BY : SHRI A.V. RAGHU RAM S.NO ITA NO ASSESSMENT YEAR APPELLANT RESPONDENT PAN 1 141/HYD/2010 2003-04 ACIT CIRCLE- 10 (1) HYDERABAD SHRI MISBAHUDDIN BABUKHAN SECUNDERABAD AEJPK 7552E 2 142/HYD/2010 2004-05 ACIT CIRCLE- 10 (1) HYDERABAD SHRI MISBAHUDDIN BABUKHAN SECUNDERABAD AEJPK 7552E 3 143/HYD/2020 2005-06 ACIT CIRCLE- 10 (1) HYDERABAD SHRI MISBAHUDDIN BABUKHAN SECUNDERABAD AEJPK 7552E 4 144/HYD/2010 2003-04 ACIT CIRCLE- 10 (1) HYDERABAD SMT.RAFIQUNNISA BEGUM SECUNDERABAD ACXPB 4205C 5 145/HYD/2010 2004-05 ACIT CIRCLE- 10 (1) HYDERABAD SMT.RAFIQUNNISA BEGUM SECUNDERABAD ACXPB 4205C 6 146/HYD/2010 2005-06 ACIT CIRCLE- 10 (1) HYDERABAD SMT.RAFIQUNNISA BEGUM SECUNDERABAD ACXPB 4205C 7 147/HYD/2010 2004-05 ACIT CIRCLE- 10 (1) HYDERABAD SHRI MUNSHI ABDUL AZIZ SECUNDERABAD ABMPM 6732C 8 148/HYD/2010 2005-06 ACIT CIRCLE- 10 (1) HYDERABAD SHRI MUNSHI ABDUL AZIZ SECUNDERABAD ABMPM 6732C 9 296/HYD/2010 2003-04 ACIT CIRCLE- 10 CD HYDERABAD SHRI MUNSHI ABDUL AZIZ SECUNDERABAD ABMPM 6732C 10 297/HYD/2010 2004-05 ACIT CIRCLE- 10 (1) HYDERABAD SHRI MUNSHI ABDUL AZIZ SECUNDERABAD ABMPM 6732C ITA NO.141-148 & 296-97 SHRI MISBHAUDDIN BABUKHAN & OTHERS SECUNDERABAD 2 PER G.C. GUPTA VICE PRESIDENT: THESE TEN APPEALS BY THE REVENUE FOR THE ASSESSMENT YEA RS 2003-04 TO 2005-06 ARE DIRECTED AGAINST THE ORDER OF THE CIT (A). SINCE IDENTICAL ISSUES ARE INVOLVED IN THESE APPEALS THES E ARE BEING DISPOSED OFF WITH THIS CONSOLIDATED ORDER. 2. THE FIRST ISSUE RAISED BY THE REVENUE IS THAT THE ASSE SSING OFFICER HAS ISSUED NOTICE U/S 143(2) WHICH WAS SERVED ON T HE ASSESSEE AND THE ASSESSEE HAS RESPONDED AND ATTENDED TO THE ASSESSMENT PROCEEDINGS AND THE ASSESSMENT FRAMED WERE VALID AND THE CIT (A) HAS ERRED IN HOLDING THE SAME AS VOID. THE LEARNED DEPARTMENTAL REPRESENTATIVE SUBMITTED THE COPY OF THE NOTICE U/S 143(2) ISSUED BY THE DEPARTMENT ALONGWITH THE COPY OF THE ACKNOWLEDGEMENT THEREOF. THE LEARNED DEPARTMENTAL R EPRESENTATIVE ALSO FILED THE COPY OF THE LETTER OF THE ASSESSEE ADDRESSED TO THE ASSESSING OFFICER REFERRING TO NOTICE ISSUED U/S 143(2) OF T HE ACT TO THE ASSESSEE AND SUBMITTED THAT THE ASSESSEE HAS ATTENDED TO THE ASSESSMENT PROCEEDINGS AND THEREFORE THE ASSESSMENT FRAMED IN SCRUTINY ASSESSMENT U/S 143(3) R.W.S. 148 WAS VALID IN ALL T HESE CASES OF THE ASSESSEES. 3. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT T HE REVENUE COULD NOT PRODUCE THE COPY OF THE NOTICE U/S 14 3(2) AND THE ACKNOWLEDGEMENT OF SERVICE THEREOF BEFORE THE CIT (A) AND THEREFORE SHOULD NOT BE ALLOWED TO PRODUCE THE SAME NOW BEFORE T HE TRIBUNAL. HE RELIED ON THE ORDER OF THE CIT (A) ON THIS ISSUE. ITA NO.141-148 & 296-97 SHRI MISBHAUDDIN BABUKHAN & OTHERS SECUNDERABAD 3 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS CAREFULLY ON THE ISSUE OF SERVICE OF NOTICE U/S 143(2) OF THE ACT. WE FIND THAT THE REVENUE HAS FILED THE COPY OF THE NOTICE ISSUED U/S 143 (2) OF TH E ACT TO THE ASSESSEES ALONGWITH THE COPY OF THE ACKNOWLEDGEMENT IN SUP PORT OF ITS CLAIM THAT THE NOTICE U/S 143(2) WAS SERVED ON THE ASSESSEE . WE FIND THAT THE ASSESSEE IN RESPONSE TO NOTICE ISSUED U/S 143(2) OF THE ACT HAS RESPONDED AND ATTENDED TO THE ASSESSMENT PROCEEDINGS A ND HAS FILED A WRITTEN REPLY TO THE QUERIES MADE BY THE ASSESSI NG OFFICER WHEREIN REFERENCE OF THE NOTICE ISSUED BY THE ASSESSING OFF ICER U/S 143(2) HAS BEEN MADE. WE FIND THAT THE LEARNED COUNSE L FOR THE ASSESSEE HAD NOT DOUBTED THE GENUINENESS OF THE COPY OF NO TICE ISSUED U/S 143(2) AND THE COPY OF THE ACKNOWLEDGEMENT OF SERVI CE THEREOF AND ALSO REGARDING THE GENUINENESS OF THE COPY OF THE R EPLY FILED BY THE ASSESSEE IN RESPONSE TO THE NOTICE ISSUED BY THE ASSESSING O FFICER U/S 143(2) OF THE ACT FILED BY THE REVENUE IN ITS COMP ILATION BEFORE THE TRIBUNAL. HE HAS MERELY SUBMITTED THAT THESE DOCUMEN TS WERE NOT PRODUCED BY THE REVENUE BEFORE THE CIT (A). IN THESE FACTS OF THE CASE WE HAVE NO HESITATION IN HOLDING THAT THE NOTICE U/S 1 43(2) OF THE ACT WAS ISSUED BY THE ASSESSING OFFICER AND SERVED ON THE ASSESSEE A ND THE ASSESSEE HAS COMPLIED WITH THE SAME BY ATTENDING THE ASSESSMENT PROCEEDINGS AND FURNISHING THE REQUISITE INFORMATION BE FORE THE ASSESSING OFFICER AND ACCORDINGLY THERE IS NO VIOLATION OF THE STATUTORY PROVISIONS IN THE MATTER OF COMPLETING THE ASSESSMENT PROCE EDINGS AND THE ISSUE IS DECIDED IN FAVOUR OF THE REVENUE AND T HE ORDER OF THE CIT (A) ON THIS ISSUE IS REVERSED AND THE GROUNDS OF APP EAL OF THE REVENUE PERTAINING TO THIS ISSUE IN ALL THE APPEALS OF THE REVENUE IS ALLOWED. ITA NO.141-148 & 296-97 SHRI MISBHAUDDIN BABUKHAN & OTHERS SECUNDERABAD 4 5. THIS LEAVES US TO THE ONLY OTHER ISSUE OF THE COMPUTAT ION OF LONG TERM CAPITAL GAIN ON MERITS THEREOF. THE LEARNED DEPA RTMENTAL REPRESENTATIVE SUBMITTED THAT THE CIT (A) HAS ERRED I N NOT ADOPTING THE FAIR MARKET VALUE AS ON 1/4/1981 AS DETERMINED BY THE ASSESSING OFFICER DULY SUPPORTED BY THE RATE GIVEN BY THE SUB R EGISTRAR'S OFFICE. SHE SUBMITTED THAT THE FAIR MARKET VALUE OF THE LAND IN QUESTION AS ON 1/4/1981 SHOULD BE ADOPTED AS PER THE VALUE INTIMATED BY THE SUB REGISTRAR'S OFFICE TO THE ASSESSING OFFICER. SHE RELIED ON THE DECISION IN 106 ITD 45 (CAL) (SB) IN SUPPORT OF HER SUBMISSION. SHE SUBMITTED THAT THE ASSESSEE COULD NOT SHOW THAT ITS SALE INSTANCES WERE COMPARABLE TO THE LAND SOLD BY THE ASSESSEE. 6. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT TH E ASSESSEE HAD GIVEN SALE INSTANCES IN SUPPORT OF THE VALUATI ON ADOPTED BY IT FOR THE LAND SOLD AS ON 1/4/1981 AND IN CASE THE ASSESSING OFFICER HAD CERTAIN RESERVATIONS IT COULD HAVE REFERRED THE MA TTER OF VALUATION TO THE DEPARTMENTAL VALUATION OFFICER (D.V.O.). HE SUB MITTED THAT THE ASSESSING OFFICER HAS ARRIVED AT THE VALUATION OF BUILDIN G EVEN WITHOUT SEEING THEM. HE SUBMITTED THAT THE BUILDINGS WERE OLD A ND SOME OF THEM DILAPIDATED. HE SUBMITTED THAT THE REASONS FOR NO T ACCEPTING THE SALE INSTANCES RELIED BY THE ASSESSEE WERE ARBITRARY AND PU RELY BASED ON GUESS WORK. HE SUBMITTED THAT THE BUILDINGS WERE VER Y OLD AND THEIR COST OF CONSTRUCTION AS ON 1/4/1981 SHOULD NOT BE AS HIGH A S RS.125/- AND RS.175/- PER SQ. FT. HE REFERRED TO THE DECISION O F THE HYDERABAD TRIBUNAL REFERRED TO BY THE CIT (A) IN ITS APPELLATE ORDER. HE SUBMITTED THAT THE CIT (A) WAS JUSTIFIED IN DECIDING THE ISSUE IN FAVOUR OF THE ASSESSEE BY HOLDING THAT THE SUB REGISTRAR'S OFFICE GUIDEL INES VALUES COULD NOT BE SUBSTITUTED FOR THE FAIR MARKET VALUE OF THE LAND DULY SUPPORTED BY SALE INSTANCES REFERRED TO BY THE ASSESSEE. ITA NO.141-148 & 296-97 SHRI MISBHAUDDIN BABUKHAN & OTHERS SECUNDERABAD 5 7. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS CAREFULLY. WE HAVE PERUSED THE ORDERS OF THE ASSESSING OFFICER AND THE CIT ( A) AND ALSO COPIES OF VARIOUS DOCUMENTS FILED BY THE REVENUE IN ITS CO MPILATION AND ALSO BY THE ASSESSEE. WE FIND THAT THE DISPUTE IN THI S CASE IS REGARDING THE COMPUTATION OF LONG TERM CAPITAL GAIN O F THE ASSESSEE. SHRI MISBAHUDDIN BABUKHAN ALONGWITH THREE OTHER FAM ILY MEMBERS HAS SOLD THREE PROPERTIES AND HAS OFFERED THEIR SHARES IN TH E LONG TERM CAPITAL GAIN. THE CONTROVERSY IS REGARDING THE FAIR MA RKET VALUE OF THESE LANDS AS ON 1/4/1981. (I) REGARDING THE VALUATION OF LAND AS ON 1/4/1981 OF THE LAND SITUATED AT TARNAKA THE ASSESSEE HAS ADOPTED THE VALUE A T RS.651/- SQ. YARD FOR THE PURPOSE OF CALCULATION OF LONG TERM CAP ITAL GAIN. THE ASSESSING OFFICER HAS ADDRESSED LETTER TO THE SUB REGISTRAR FOR OBTAINING MARKET VALUE AS ON 1/4/1981 AND IT WAS INTI MATED TO THE ASSESSING OFFICER BY THE SUB REGISTRAR'S OFFICE THAT THE FA IR MARKET VALUE AS ON 1/4/1981 OF THE TARNAKA LAND WAS RS.125/- PER SQ. YARD. THE ASSESSEE HAS RELIED ON TWO SALE INSTANCES DATED 21/2/198 0 OF G. PADMA JAYARAM GIVING A RATE OF RS.283/- PER SQ. YARD OF A PLOT MEASURING 300 SQ. YARD AND DATED 31/12/1980 OF SMT. J AYASRI SRINIVAS GIVING A RATE OF RS.651/- PER SQ.YARD OF 347 SQ. YARD PLOT. WE FIND THAT THE ASSESSEE COULD NOT FILE ANY EVIDENCE TO SHOW THAT THE TWO SALE INSTANCES RELIED UPON BY IT REGARDING TARNAKA LAND WER E COMPARABLE TO THE LAND SOLD BY THE ASSESSEE. THIS APPEAL WAS ADJOURNED B Y THE TRIBUNAL TWO TIMES TO GIVE FURTHER OPPORTUNITY TO TH E ASSESSEE TO FILE EVIDENCE INCLUDING A SITE PLAN TO SHOW THAT THE SALE INS TANCES REFERRED BY THE ASSESSEE WERE COMPARABLE TO THE LAND SOLD BY THE A SSESSEE. HOWEVER THE ASSESSEE FAILED TO FILE ANY EVIDENCE IN THIS REGARD. MOREOVER THE ASSESSEE ALONGWITH OTHER CO-OWNERS HAS SOLD A MUCH ITA NO.141-148 & 296-97 SHRI MISBHAUDDIN BABUKHAN & OTHERS SECUNDERABAD 6 BIGGER PLOT MEASURING 2435 SQ.YARD WHICH IS UNCOMPARABLE TO THE SALE INSTANCES OF 300 SQ. YARD AND 347 SQ.YARDS. NO VALID REASO N HAS BEEN GIVEN BY THE CIT (A) TO REJECT THE LAND RATE GIVEN B Y THE SUB REGISTRAR'S OFFICE AS ON 1-4-1981. IN THE ABSENCE OF ANY MATERIAL BROUGHT ON RECORD TO SHOW THAT SALE INSTANCES RELIED UPON BY THE ASSESSEE WERE 'COMPARABLE' WE HOLD THAT THE LAND RATE A S PER THE REPORT OF THE SUB REGISTRAR'S OFFICE HAS TO BE ADOPTED . HOWEVER SOME MARGIN ON ACCOUNT OF THE FACT THAT THE BUILT UP AREA BEING VERY OLD AND THEIR COST OF CONSTRUCTION WERE TAKEN AT A HIGHER FIGUR E BY THE ASSESSING OFFICER HAS TO BE ALLOWED. IN THESE FACTS OF THE CASE WE HOLD THAT THERE WAS NO REASON FOR THE CIT (A) TO ADOPT THE FAIR MARKET VALUE OF THE LAND AS ON 1/4/1981 AT THE VALUE DECLARED BY T HE ASSESSEE AND THE ENDS OF JUSTICE SHALL BE MET IF THE FAIR MARKET VAL UE OF THE TARNAKA LAND AS ON 1/4/1981 IS ADOPTED AT RS.200/- SQ.YARD AND WE DIRECT THE ASSESSING OFFICER TO WORK OUT THE LONG TERM CAPITAL GAIN ACCORDINGLY WITH REGARD TO SALE OF TARNAKA LAND. (II) REGARDING THE VALUATION OF LAND AS ON 1-4-1981 OF THE LAND SITUATED AT M.G. ROAD THE ASSESSEE HAS ADOPTED THE VALUE AT RS.1946/- PER SQ. YARD FOR THE PURPOSE OF CALCULATION OF LONG TERM CAPITAL GAIN FOR ASSESSMENT YEAR 2003-04 AND 2004-05. T HE ASSESSING OFFICER HAS ADDRESSED LETTER TO THE SUB REGISTRAR FOR OB TAINING MARKET VALUE AS ON 1/4/1981 AND IT WAS INTIMATED TO THE ASSESSIN G OFFICER BY THE SUB REGISTRAR'S OFFICE THAT THE FAIR MARKET VALUE AS ON 1/4/1981 OF THE MG ROAD LAND WAS RS.225/- PER SQ. YARD. THE ASSESSEE HAS RELIED ON THREE SALE INSTANCES VIZ. DATED 31-8-1981 OF DR. P RABHAKAR RAMULU GIVING A RATE OF RS.1940/- PER SQ. YARD OF A PLOT MEASURING 167.5 SQ. YARD. THE SECOND SALE INSTANCE QUOTED BY THE ASSE SSEE IS DATED 20-7-1981 OF SMT. KALPANA REDDY GIVING A RATE OF RS.1816/- PER ITA NO.141-148 & 296-97 SHRI MISBHAUDDIN BABUKHAN & OTHERS SECUNDERABAD 7 SQ. YARD OF SHOP MEASURING 26.43 SQ. YARD. THE THIRD SA LE INSTANCE RELIED UPON BY THE ASSESSEE IS DATED 13-05-1981 OF ASIAN BEARINGS & TOOLS GIVING A RATE OF RS.1472/- PER SQ. YARD OF A SHOP MEASURING 32.60 SQ. YARD. WE FIND THAT THE ASSESSEE COULD NOT FILE ANY EVIDENCE TO SHOW THAT THESE THREE SALE INSTANCES RELIED UPON BY I T REGARDING LAND/SHOP AT MG ROAD WERE COMPARABLE TO THE LAND SOLD BY THE ASSESSEE. AS MENTIONED EARLIER THIS APPEAL WAS ADJOURNE D BY THE TRIBUNAL ON TWO OCCASIONS TO GIVE FURTHER OPPORTUNITY T O THE ASSESSEE TO FILE EVIDENCE INCLUDING A SITE PLAN TO SHOW THAT TH E SALE INSTANCES REFERRED BY THE ASSESSEE WERE COMPARABLE TO THE LAND SOL D BY THE ASSESSEE. HOWEVER THE ASSESSEE HAS FAILED TO FILE ANY EVIDEN CE IN THIS REGARD. WE FIND THAT NO VALID REASON HAS BEEN GIVEN B Y THE CIT (A) TO REJECT THE LAND RATE GIVEN BY THE SUB REGISTRAR OFFICE AS ON 1-4-1981. IN THE ABSENCE OF ANY MATERIAL BROUGHT ON RECORD TO SHO W THAT THE SALE INSTANCES RELIED UPON BY THE ASSESSEE WERE 'COMPARABLE' WE HOLD THAT THE LAND RATE AS PER THE REPORT OF THE SUB REGISTRAR 'S OFFICE HAS TO BE ADOPTED. HOWEVER SOME VARIATIONS ON ACCOUNT OF THE FACT THAT THE BUILT UP AREA OF THE SALE INSTANCES WERE VERY OLD AND THEIR COST OF CONSTRUCTION WERE TAKEN AT A HIGHER FIGURE BY THE ASSESSI NG OFFICER HAS TO BE ALLOWED. IN THESE FACTS OF THE CASE WE HOLD THA T THERE WAS NO VALID REASON FOR THE CIT (A) TO ADOPT THE FAIR MARKE T VALUE OF THE LAND AS ON 1-4-1981 AT THE VALUE DECLARED BY THE ASSESSEE AND CONSIDERING THE TOTALITY OF THE FACTS AND CIRCUMSTANCES OF THE CASE A ND ALLOWING DUE MARGIN DUE TO HIGHER VALUE OF COST OF CONSTRUCTION IN THE SALE INSTANCES ESTIMATED BY THE ASSESSING OFFICER WE HOLD THAT ENDS OF J USTICE SHALL BE MET IF THE FAIR MARKET VALUE OF THE LAND AT MG R OAD AS ON 1-4-1981 IS ADOPTED AT RS.500/- PER SQ. YARD FOR THE ASSESSMENT YEA R 2003-04 AND 2004-05 AND WE DIRECT THE ASSESSING OFFICER TO WORK O UT THE LONG TERM CAPITAL GAIN WITH REGARD TO SALE OF MG ROAD LAND ACCORDINGLY. FOR ITA NO.141-148 & 296-97 SHRI MISBHAUDDIN BABUKHAN & OTHERS SECUNDERABAD 8 THE ASSESSMENT YEAR 2005-06 THE ONLY DIFFERENCE IN THE F ACTS OF THE CASE IS THAT WHEREAS THE ASSESSEE HAS VALUED THE LAND AT MG ROAD FOR THE ASSESSMENT YEAR 2003-04 AS WELL AS ASSESSMENT YEAR 2004-0 5 AND ASSESSMENT YEAR 2005-06 AT RS.1946/- PER SQ. YARD BUT TH E ASSESSING OFFICER ON THE BASIS OF THE SUB REGISTRAR'S REPORT HAS V ALUED THE SAME AT RS.225/- PER SQ. YARD FOR THE ASSESSMENT YEAR 2003-04 AND ASSESSMENT YEAR 2004-05 AND AT RS.275/- PER SQ. YARD FOR THE ASSESSMENT YEAR 2005-06. CONSIDERING THE TOTALITY OF THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE FACT THAT WE HAVE DIRECTE D THE LAND RATE OF RS.500/- PER SQ. YARD AS ON 1/4/1981 FOR THE A SSESSMENT YEAR 2003-04 AND ASSESSMENT YEAR 2004-05 WE HOLD THAT IT SHA LL BE REASONABLE TO ASSESS THE FAIR MARKET VALUE OF THE LAND A T MG ROAD AS ON 1/4/1981 FOR THE PURPOSE OF CALCULATION OF LONG TER M CAPITAL GAIN FOR THE CASES RELATING TO ASSESSMENT YEAR 2005-06 AT RS.500/- P ER SQ. YARD AND WE DIRECT THE ASSESSING OFFICER TO WORK OUT THE LONG TERM CAPITAL GAIN ACCORDINGLY. (III) ONE OF THE RESPONDENT ASSESSEE IN THESE CASES SHRI MISB AHUDDIN BABUKHAN FOR ASSESSMENT YEAR 2004-05 HAS RECEIVED COMPENSAT ION IN RESPECT OF HIS 40% SHARE IN LAND AT JN ROAD ABIDS. REGA RDING THE VALUATION OF THE LAND AS ON 1/4/1981 OF THE LAND SITU ATED AT JN ROAD ABIDS THE ASSESSEE HAS ADOPTED THE VALUE OF RS.900/- PER SQ. YARD FOR THE PURPOSE OF CALCULATION OF LONG TERM CAPITAL GAIN. T HE ASSESSING OFFICER HAS ADDRESSED LETTER TO THE SUB REGISTRAR FOR OB TAINING THE FAIR MARKET VALUE AS ON 1/4/1981 AND IT WAS INTIMATED TO T HE ASSESSING OFFICER BY THE SUB REGISTRAR'S OFFICE THAT THE FAIR MAR KET VALUE AS ON 1/4/1981 OF THE LAND AT JN ROAD ABIDS WAS RS.300/- P ER SQ. YARD. THE ASSESSEE HAS RELIED ON ONE SALE INSTANCE DATED 30/1/1981 OF DIAMOND BUILDERS IN RESPECT OF 1ST FLOOR OF PROPERTY ON JN ROAD CONSISTING OF ITA NO.141-148 & 296-97 SHRI MISBHAUDDIN BABUKHAN & OTHERS SECUNDERABAD 9 940 SQ. YARD WITH A PASSAGE OF 14/31' AND LENGTH OF 15 ' FOR A CONSIDERATION OF RS.8.00 LAKHS.WE FIND THAT THE ASSESSEE HA S NOT FILED ANY EVIDENCE TO SHOW THAT THE SALE INSTANCE RELIED UPON REGARDING THE LAND AT JN ROAD ABIDS WAS 'COMPARABLE' TO THE LAND SOL D BY THE ASSESSEE. AS ALREADY MENTIONED THIS APPEAL WAS ADJOURNED BY US TWO TIMES TO GIVE OPPORTUNITY TO THE ASSESSEE TO SHOW THAT T HE SALE INSTANCE REFERRED BY THE ASSESSEE WAS 'COMPARABLE' TO THE L AND SOLD BY THE ASSESSEE. THE ASSESSEE COULD NOT FILE ANY EVIDENCE IN THI S REGARD. WE FIND THAT NO VALID REASON HAS BEEN GIVEN BY THE CI T (A) TO REJECT THE LAND RATE GIVEN BY THE SUB REGISTRAR AS ON 1/4/19 81. IN THE ABSENCE OF ANY MATERIAL BROUGHT ON RECORD TO SHOW THAT THE SALE INSTANCE RELIED UPON BY THE ASSESSEE WAS COMPARABLE WE HOL D THAT THE LAND RATE AS PER THE REPORT OF THE SUB REGISTRAR'S OFF ICE HAS TO BE ADOPTED. HOWEVER WE FIND THAT THE COST OF CONSTRUCTION OF BUILT UP AREA IN THE SALE INSTANCE RELIED UPON BY THE ASSESSEE HAS BEEN ESTIMATED ON THE HIGHER SIDE BY THE ASSESSING OFFICER SINCE THE PROPERTY WAS OLD. IN THESE FACTS OF THE CASE WE HOLD THA T THERE WAS NO REASON WITH THE CIT (A) TO ADOPT THE FAIR MARKET VAL UE OF THE LAND AS ON 1/4/1981 AT THE VALUE DECLARED BY THE ASSESSEE AND TH E ENDS OF JUSTICE SHALL BE MET IF THE FAIR MARKET VALUE OF THE L AND AT JN ROAD ABIDS AS ON 1/4/1981 IS ADOPTED AT RS.500/- PER SQ. YARD AND WE DIRECT THE ASSESSING OFFICER TO WORK OUT THE LONG TERM CAP ITAL GAIN ACCORDINGLY WITH REGARD TO THE SALE OF LAND AT JN ROAD ABIDS. (IV) REGARDING THE VALUATION OF LAND AS ON 1-4-1981 OF THE LAND SITUATED AT SUBHASH ROAD THE ASSESSEE HAS ADOPTED THE V ALUE OF RS.1200/- PER SQ. YARD FOR THE PURPOSE OF CALCULATION OF LONG TERM CAPITAL GAIN. THE ASSESSING OFFICER HAS ADDRESSED LETTER TO THE SUB REGISTRAR FOR OBTAINING FAIR MARKET VALUE AS ON 1-4-1981 AND IT WAS ITA NO.141-148 & 296-97 SHRI MISBHAUDDIN BABUKHAN & OTHERS SECUNDERABAD 10 INTIMATED TO THE ASSESSING OFFICER BY THE SUB REGISTRAR' S OFFICE THAT THE FAIR MARKET VALUE AS ON 1-4-1981 OF THE LAND AT SUBH ASH ROAD WAS RS.125/- PER SQ.YARD. THE ASSESSEE HAS RELIED ON ONE SALE INSTANCE DATED 20-7-1981 OF SHRI K.GYANESHWAR & OTHERS GIVING A RATE OF RS.1176/- PER SQ. YARD OF A SHOP MEASURING 33.83 SQ. YA RDS. WE FIND THAT THE ASSESSEE COULD NOT FILE ANY EVIDENCE TO SHOW THAT THE SALE INSTANCE RELIED UPON BY IT REGARDING LAND AT SUBHASH ROAD WAS 'COMPARABLE' TO THE LAND SOLD BY THE ASSESSEE. AS MENTIONE D EARLIER THIS APPEAL WAS ADJOURNED BY THE TRIBUNAL TWO TIMES T O GIVE FURTHER OPPORTUNITY TO THE ASSESSEE TO SHOW THAT THE SALE INSTANCE REFERRED BY THE ASSESSEE WAS COMPARABLE TO THE LAND SOLD BY THE ASSESSEE . THE ASSESSEE HAS FAILED TO FILE ANY EVIDENCE IN THIS REGARD. W E FIND THAT NO VALID REASON HAS BEEN GIVEN BY THE CIT (A) TO REJECT T HE LAND RATE GIVEN BY THE SUB REGISTRAR OFFICE AS ON 1-4-1981. IN T HE ABSENCE OF ANY MATERIAL BROUGHT ON RECORD TO SHOW THAT THE SALE I NSTANCE RELIED UPON BY THE ASSESSEE WAS 'COMPARABLE' WE HOLD THAT THE LAND RATE AS PER THE REPORT OF THE SUB REGISTRAR'S OFFICE HAS TO BE ADOPTED. HOWEVER WE FIND THAT THE COST OF CONSTRUCTION OF THE BUI LT UP AREA IN THE SALE INSTANCE RELIED UPON BY THE ASSESSEE HAS BEEN ESTI MATED ON THE HIGHER SIDE BY THE ASSESSING OFFICER SINCE THE PROPER TY WAS OLD AND DILAPIDATED AND SUITABLE DEDUCTION HAS TO BE ALLO WED IN ORDER TO ARRIVE AT A REASONABLE FIGURE OF THE LAND RATE IN TH E AREA AS ON 1-4- 1981. IN THESE FACTS OF THE CASE WE HOLD THAT THERE WAS NO REASON FOR THE CIT (A) TO ADOPT THE FAIR MARKET VALUE OF THE L AND AS ON 1-4-1981 AT THE VALUE DECLARED BY THE ASSESSEE AND THE ENDS OF JUS TICE SHALL BE MET IF THE FAIR MARKET VALUE OF THE LAND AT SUBHASH ROAD AS ON 1-4- 1981 IS ADOPTED AT RS.300/- PER SQ. YARD AND WE DIRECT THE ASSESSING OFFICER TO WORK OUT THE LONG TERM CAPITAL GAIN ACCORDI NGLY WITH REGARD ITA NO.141-148 & 296-97 SHRI MISBHAUDDIN BABUKHAN & OTHERS SECUNDERABAD 11 TO THE SALE OF LAND AT SUBHASH ROAD. WE DIRECT ACCORDIN GLY. THE GROUNDS OF APPEAL IN ALL THE APPEALS OF THE REVENUE RELATING TO THE CALCULATION OF LONG TERM CAPITAL GAIN ARE PARTLY ALLOW ED. 8. IN THE RESULT ALL THE APPEALS OF THE REVENUE ARE P ARTLY ALLOWED. ORDER PRONOUNCED IN THE COURT ON 16.7.2010 SD/- SD/- (CHANDRA POOJARI) (G.C. GUPTA) ACCOUNTANT MEMBER VICE PRESIDENT PVV/SPS DATE: 16.7.2010 COPY FORWARDED TO: 1. THE ASSISTANT COMMISSIONER OF INCOME-TAX CIRCLE-10(1) ROOM NO.515 AC GUARDS IT TOWERS HYDERABAD 2. SHRI MISBAHUDDIN BABUKHAN 5-4-94 MG ROAD SECUNDERA BAD 3. SMT. RAFIQUNNISA BEGUM 5-4-94 MG ROAD SECUNDERABAD 4. SHRI MUNSHI ABDUL AZIZ 5-4-94 MG ROAD SECUNDERABAD 5. THE COMMISSIONER OF INCOME-TAX (APPEALS) TIRUPATI 6. THE COMMISSIONER OF INCOME-TAX-5 HYDERABAD