ITO, CHENNAI v. Late Smt.V.N.Amirthavalli, CHENNAI

ITA 1977/CHNY/2010 | 2002-2003
Pronouncement Date: 07-09-2011 | Result: Dismissed

Appeal Details

RSA Number 197721714 RSA 2010
Assessee PAN AHZPA5003B
Bench Chennai
Appeal Number ITA 1977/CHNY/2010
Duration Of Justice 9 month(s) 18 day(s)
Appellant ITO, CHENNAI
Respondent Late Smt.V.N.Amirthavalli, CHENNAI
Appeal Type Income Tax Appeal
Pronouncement Date 07-09-2011
Appeal Filed By Department
Order Result Dismissed
Bench Allotted C
Tribunal Order Date 07-09-2011
Date Of Final Hearing 06-09-2011
Next Hearing Date 06-09-2011
Assessment Year 2002-2003
Appeal Filed On 19-11-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH CHENNAI BEFORE DR. O.K. NARAYANAN VICE-PRESIDENT AND SHRI HARI OM MARATHA JUDICIAL MEMBER I.T.A.NO. 1977/MDS/2010 (ASSESSMENT YEAR : 2002-03) THE INCOME-TAX OFFICER BUSINESS WARD III(1) CHENNAI. VS. LATE SMT. V.N.AMIRTHAVALLI C/O SMT. GAYATRI JAISHANKAR G-8 GROUND FLOOR SRI SAIRAM APARTMENTS 71-73 FIRST MAIN ROAD SASTRI NAGAR ADYAR CHENNAI 20. PAN AHZPA 5003 B (APPELLANT) (RESPONDENT) I.T.A.NO. 1943/MDS/2010 (ASSESSMENT YEAR : 2002-03) LATE SMT. V.N.AMIRTHAVALLI C/O SMT. GAYATRI JAISHANKAR CHENNAI-20. VS. THE INCOME-TAX OFFICER CHENNAI 34. (APPELLANT) (RESPONDENT) DEPARTMENT BY : DR. I. VIJAYAKUMAR IRS C IT ASSESSEE BY : SHRI CH.G. MURALI KRISHNA MURTHY FCA DATE OF HEARING : 6 TH SEPTEMBER 2011 DATE OF PRONOUNCEMENT : 7 TH SEPTEMBER 2011 ITA 1977 & 1943/10 :- 2 -: O R D E R PER DR. O.K. NARAYANAN VICE-PRESIDENT THESE TWO APPEALS ARE CROSS APPEALS FILED BY THE R EVENUE AND FILED BY THE ASSESSEE. THE RELEVANT ASSESSMENT YEAR IS 2002-03. THE APPEALS ARE DIRECTED AGAINST THE ORDE R OF THE COMMISSIONER OF INCOME-TAX (APPEALS)-IX AT CHENNAI DATED 30.8.2010 AND ARISE OUT OF THE ASSESSMENT COMPLETE D UNDER SEC.143(3) READ WITH SEC.147 OF THE INCOME-TAX ACT 1961. 2. IN THE APPEAL FILED BY THE REVENUE THE CONTENTI ON IS THAT THE COMMISSIONER OF INCOME-TAX (APPEALS) HAS ERRED IN H OLDING THAT THE ASSESSEE IS ELIGIBLE TO CLAIM EXEMPTION UNDER S EC.54 IN RESPECT OF TWO FLATS AS NEW ASSETS BY THE ASSESSEE. 3. THE ASSESSEE HAD ACQUIRED THE OWNERSHIP AND POSS ESSION OF THREE FLATS IN THE SAME RESIDENTIAL COMPLEX IN E XCHANGE OF HER RIGHT IN THE LAND DEVELOPED FOR CONSTRUCTION OF FLA T COMPLEX. THE ASSESSEE GOT THREE FLATS SUCCESSIVELY IN VERTICAL R ELATION. SHE CLAIMED EXEMPTION UNDER SEC.54 IN RESPECT OF TWO FL ATS. THE ASSESSING AUTHORITY HAS ALLOWED EXEMPTION ONLY IN R ESPECT OF ONE ITA 1977 & 1943/10 :- 3 -: FLAT. THE COMMISSIONER OF INCOME-TAX (APPEALS) ALL OWED EXEMPTION FOR BOTH THE FLATS MAINLY RELYING ON THE DECISION OF THE HONBLE KARNATAKA HIGH COURT IN THE CASE OF CIT V. SMT. K.G.RUKMINIAMMA (331 ITR 211) WHERE THE COURT HAS H ELD IN THE FACTS AND CIRCUMSTANCES OF THAT CASE THAT FOUR RESI DENTIAL FLATS CONSTITUTED A RESIDENTIAL HOUSE FOR THE PURPOSE O F SEC.54. ON GOING THOUGH THE FACTS OF THE PRESENT CASE WE FIND THAT THE ABOVE JUDGMENT OF THE KARNATAKA HIGH COURT APTLY APPLIES TO THE ASSESSEES CASE. THEREFORE WE FIND THAT THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS) ON THIS POINT IS TO BE UPHELD. 4. THE APPEAL FILED BY THE REVENUE IS LIABLE TO BE DISMISSED. 5. NOW REGARDING THE APPEAL FILED BY THE ASSESSEE THE FIRST GROUND IS THAT THE ISSUE OF NOTICE UNDER SEC.148 WA S BAD IN LAW. ON GOING THROUGH THE ORDERS OF THE LOWER AUTHORITIE S AND IN THE LIGHT OF THE ARGUMENTS ADVANCED BY THE LEARNED CHAR TERED ACCOUNTANT APPEARING FOR THE ASSESSEE WE FIND THAT THERE IS NO GOOD CASE FOR THE ASSESSEE AS FAR AS THE RELEVANCE OF SEC.148 NOTICE IS CONCERNED. ITA 1977 & 1943/10 :- 4 -: 6. THE NEXT GROUND RAISED BY THE ASSESSEE IS THAT T HE LOWER AUTHORITIES HAVE ERRED IN INVOKING THE DEFINITION O F TRANSFER UNDER SEC.2(47) OF THE INCOME-TAX ACT 1961 IN THE ABSENC E OF ANY TRANSFER. ACCORDING TO THE ASSESSEE THE DEVELOPM ENT AGREEMENT DOES NOT CONSTITUTE A SALE. AS ULTIMATELY THE ASS ESSEE HAS ACQUIRED RIGHT AND POSSESSION OF THREE FLATS THIS CONTENTION IS ONLY ACADEMIC. 7. THE NEXT CONTENTION RAISED BY THE ASSESSEE IS TH AT THE LOWER AUTHORITIES HAVE ERRED IN DISALLOWING 50% OF THE CO ST OF IMPROVEMENT CLAIMED BY THE ASSESSEE. IN THE FACTS AND CIRCUMSTANCES OF THE CASE THE ALLOWANCE OF 50% TOW ARDS THE CLAIM OF THE ASSESSEE IS JUST AND FAIR. THE BALANC E DISALLOWANCE IS CONFIRMED. 8. THE NEXT GROUND OF THE ASSESSEE IS THAT THE ENTI RE PATTI WORK OF ` 60 000/- AS AGAINST ` 30 000/- SHOULD HAVE BEEN ALLOWED. WE DO NOT FIND ANY REASON TO INTERFERE WITH THE ORD ERS OF THE LOWER AUTHORITIES ON THIS POINT. 9. THE LAST GROUND RAISED BY THE ASSESSEE IS THAT T HE ASSESSING OFFICER HAS ERRED IN REFERRING TO THE DVO THE COST OF ITA 1977 & 1943/10 :- 5 -: ACQUISITION. EVEN THOUGH SUCH REFERENCE WAS MADE B Y THE ASSESSING AUTHORITY THE ASSESSMENT WAS COMPLETED EVEN BEFORE OBTAINING THE REPORT OF THE DVO AND AS SUCH THE RE FERENCE MADE BY THE ASSESSING AUTHORITY HAS BEEN ABORTED. THERE FORE THIS CONTENTION HAS NO LEGS TO STAND. THE APPEAL OF THE ASSESSEE IS LIABLE TO BE DISMISSED. 10. IN RESULT THE APPEAL FILED BY THE REVENUE AS W ELL AS BY THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED ON WEDNESDAY THE 7 TH OF SEPTEMBER 2011 AT CHENNAI. SD/- SD/- (HARI OM MARATHA) (DR.O.K.NARAYANAN) JUDICIAL MEMBER VICE-PRESIDENT CHENNAI DATED THE 7 TH SEPTEMBER 2011 MPO* COPY TO : APPELLANT/RESPONDENT/CIT/CIT(A)/DR