SULTAN HAZRAT SHAH, MUMBAI v. ITO 13(2)(4),

ITA 3856/MUM/2010 | 2005-2006
Pronouncement Date: 18-11-2011 | Result: Allowed

Appeal Details

RSA Number 385619914 RSA 2010
Assessee PAN AAKPS7754D
Bench Mumbai
Appeal Number ITA 3856/MUM/2010
Duration Of Justice 1 year(s) 6 month(s) 5 day(s)
Appellant SULTAN HAZRAT SHAH, MUMBAI
Respondent ITO 13(2)(4),
Appeal Type Income Tax Appeal
Pronouncement Date 18-11-2011
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted E
Tribunal Order Date 18-11-2011
Date Of Final Hearing 15-11-2011
Next Hearing Date 15-11-2011
Assessment Year 2005-2006
Appeal Filed On 13-05-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH E MUMBAI BEFORE SHRI B.R. MITTAL (JUDICIAL MEMBER) AND SHRI T.R. SOOD (ACCOUNTANT MEMBER) ITA NO.3856/MUM/2010 ASSESSMENT YEAR-2005-06 SHRI SULTAN HAZRAT SHAH 111 NAVRATAN BLDG. 69 P. MELLOW ROAD MUMBAI-400 009 PAN-AAKPS 7754D VS. THE ITO 13(2)(4) MUMBAI (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI KESHAV B. BHUJLE RESPONDENT BY: SHRI G.P. TRIVEDI DATE OF HEARING :15.11.2011 DATE OF PRONOUNCEMENT:18.11.2011 O R D E R PER B.R. MITTAL JM : THE ASSESSEE HAS FILED THIS APPEAL FOR ASSESSMENT Y EAR 2005-06 AGAINST ORDER OF LD. CIT(A) DT.5.3.2010. 2. ONE OF THE ISSUES INVOLVED IN THIS APPEAL IS AS TO WHETHER CAPITAL GAIN COMPUTED BY ASSESSEE IN RESPECT OF JEWELLERY SOLD I N ASSESSMENT YEAR UNDER CONSIDERATION WAS CORRECTLY ASSESSED IN ASSESSMENT COMPLETED U/S. 143(3) VIDE ORDER DT. 29.1.2007 OR NOT? 3. THE RELEVANT FACTS ARE THAT ASSESSEE RECEIVED BY WAY OF WILL CERTAIN JEWELLERY AND ORNAMENTS FROM HIS MOTHER-IN-LAW DT. 12.01.1998. OUT OF SUCH ASSETS ASSESSEE SOLD SOME OF ASSETS DURING THE PRE VIOUS YEAR RELEVANT TO ASSESSMENT YEAR UNDER CONSIDERATION AND AFTER INDEX ATION SHOWN CAPITAL LOSS ITA NO. 3856/M/10 2 OF RS. 3 86 713/-. DURING THE COURSE OF REGULAR AS SESSMENT MADE U/S. 143(3) OF THE ACT LOSS WAS ACCEPTED BY AO. SUBSEQUENTLY AO ISSUED NOTICE U/S. 154 OF THE I.T. ACT STATING THAT INDEXATION BENEFIT WAS AVAILABLE TO ASSESSEE FOR THE PERIOD ON DATE OF WILL I.E. 12.1.1998 TO THE DATE O F TRANSFER INSTEAD OF CONSIDERING THE PERIOD FROM THE DATE ASSET WAS HEL D BY PREVIOUS OWNER I.E. MOTHER-IN-LAW OF ASSESSEE TILL THE DATE OF TRANSFER . ACCORDINGLY AO RECOMPUTED THE CAPITAL GAIN BY CONSIDERING INDEXED COST OF ASSET FROM THE DATE OF WILL I.E. 12.1.1998 TO THE DATE OF TRANSFER WHICH COMES TO RS. 17 05 000/-. IN THE FIRST APPEAL LD. CIT(A) CONFI RMED THE ACTION OF AO. HENCE ASSESSEE IS IN FURTHER APPEAL BEFORE TRIBUNA L. 4. IN THE GROUND OF APPEAL ASSESSEE HAS DISPUTED TH E ACTION OF AO FIRSTLY THAT RE-COMPUTATION OF CAPITAL GAIN BY AO BY ISSUIN G NOTICE U/S. 154 OF THE ACT IS A DEBATABLE ISSUE AND THE SAME IS NOT AN APPAREN T MISTAKE WHICH COULD BE RECTIFIED U/S. 154 OF THE ACT. SECONDLY ASSESSEE HAS STATED THAT THE ISSUE IS SQUARELY COVERED IN FAVOUR OF ASSESSEE BY DECISION OF ITAT SPECIAL BENCH MUMBAI IN THE CASE OF DCIT VS MANJULA J. SHAH (2010 ) 35 SOT 105 (SB) WHEREIN IT HAS BEEN HELD WITH REFERENCE TO GIFT RE CEIVED BY ASSESSEE THAT FOR THE PURPOSE OF COMPUTATION OF LONG TERM CAPITAL GAI N ARISING FROM TRANSFER OF CAPITAL ASSETS WHICH WAS RECEIVED BY ASSESSEE UNDER THE GIFT THE INDEXED COST OF ACQUISITION OF SUCH CAPITAL ASSETS HAD TO BE COM PUTED WITH REFERENCE TO THE YEAR IN WHICH PREVIOUS OWNER FIRST HELD ASSET. IN O THER WORDS INDEXED COST OF ACQUISITION IS TO BE CONSIDERED FROM THE DATE THE A SSET WERE HELD BY DONOR AND NOT FROM THE DATE WHEN THE ASSETS WERE HELD BY DONEE TILL THE DATE OF TRANSFER. THE LD. DEPARTMENTAL REPRESENTATIVE IN H IS SUBMISSION HAS NOT DISPUTED THE FACTS OF CASE SAVE AND ACCEPT RELYING ON ORDERS OF AUTHORITIES BELOW. 5. WE WITHOUT GOING INTO THE CONTROVERSY AS TO WHE THER THE ISSUE IS A DEBATABLE ONE OR NOT AND IS OUTSIDE THE PURVIEW OF SEC. 154 OF THE ACT OR NOT HOLD THAT ISSUE INVOLVED IS SQUARELY COVERED I N FAVOUR OF ASSESSEE BY THE DECISION OF ITAT SPECIAL BENCH IN THE CASE OF DCIT VS MANJULA J. SHAH ITA NO. 3856/M/10 3 (SUPRA). THEREFORE WE HOLD THAT CAPITAL GAIN HAD RIGHTLY BEEN COMPUTED BY AO WHILE MAKING ASSESSMENT U/S. 143(3) OF THE ACT B Y TAKING COST OF INDEXATION FROM THE DATE THE ASSETS WERE HELD BY PR EVIOUS OWNER NAMELY MOTHER-IN-LAW OF ASSESSEE TILL THE DATE OF TRANSFER AND NOT TO BE COMPUTED BY TAKING INDEXED COST FROM THE DATE OF WILL TILL DATE OF TRANSFER. ACCORDINGLY WE SET ASIDE THE ORDERS OF AUTHORITIES BELOW BY ALLOWI NG THE ISSUE IN FAVOUR OF ASSESSEE. 6. IN THE RESULT APPEAL FILED BY ASSESSEE IS ALLOWE D. ORDER PRONOUNCED ON THIS 18 TH DAY OF NOVEMBER 2011 SD/- SD/- ( T.R. SOOD) (B.R. MITTAL ) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI DATED 18 TH NOVEMBER 2011 RJ COPY TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT-CONCERNED 4. THE CIT(A)-CONCERNED 5. THE DR E BENCH TRUE COPY BY ORDER ASSTT. REGISTRAR I.T.A.T MUMBAI