Mrs Praveen Hoon, Noida v. ACIT, Noida

ITA 3868/DEL/2011 | 2006-2007
Pronouncement Date: 27-07-2012 | Result: Partly Allowed

Appeal Details

RSA Number 386820114 RSA 2011
Assessee PAN ABSPH0602G
Bench Delhi
Appeal Number ITA 3868/DEL/2011
Duration Of Justice 11 month(s) 11 day(s)
Appellant Mrs Praveen Hoon, Noida
Respondent ACIT, Noida
Appeal Type Income Tax Appeal
Pronouncement Date 27-07-2012
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted F
Tribunal Order Date 27-07-2012
Date Of Final Hearing 06-06-2012
Next Hearing Date 06-06-2012
Assessment Year 2006-2007
Appeal Filed On 16-08-2011
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH : F : NEW DELHI BEFORE SHRI I. C. SUDHIR JUDICIAL MEMBER AND SHRI T.S. KAPOOR ACCOUNTANT MEMBER ITA NO. 3868/DEL/2011 ASSESSMENT YEAR: 2006- 2007 PRAVEENA HOON VS. ACIT H.NO. 118 SECTOR-28 INCOME TAX CIRCLE NOIDA NOIDA ABSPH0602G (APPELLANT) (RESP ONDENT) APPELLANT BY : SHRI S.M. MATHUR CA RESPONDENT BY : SHRI VIKAS K. SURYAWANSHI CIT(DR) DATE OF HEARING : 06/06/2012 DATE OF PRONOUNCEMENT : 07/2012 ORDER PER I.C. SUDHIR JUDICIAL MEMBER THE ASSESSEE HAS QUESTIONED FIRST APPELLATE ORDER ON SEVERAL GROUNDS INVOLVING THE ISSUE AS TO WHETHER THE LD. C IT(A) WAS JUSTIFIED IN UPHOLDING THE ADDITION OF RS. 6 25 000/- MADE BY THE AO ON ACCOUNT OF SUPPRESSED SALE CONSIDERATION FOR SALE OF IMMOV ABLE PROPERTY DURING THE YEAR. ITA NO. 3868/DEL/2011 2 2. THE RELEVANT FACTS ARE THAT THE PROPERTY BEARING NO. C-768 NEW FRIENDS COLONY NEW DELHI ORIGINALLY BELONGED TO MR S. KRISHAN NANDA. MRS. KRISHAN NANDA TRANSFERRED HER 2/3 RD SHARE IN THE PROPERTY IN FAVOUR OF MS. SITA NANDA AND SHRI RAJIV KRISHAN NAN DA BY WAY OF GIFT. THUS MRS. KRISHNAN NANDA MS. SITA NANDA AND SHRI R AJIV KRISHAN NANDA BECAME THE JOINT OWNERS OF THE PROPERTY HAVIN G 1/3 RD SHARE EACH. MRS. KRISHNA NANDA AND HER HUSBAND DIED ON 2 .12.1994 AND 2.12.2001 RESPECTIVELY. THEY LEFT FOUR LEGAL HEIRS I.E. THREE DAUGHTERS (INCLUDING ASSESSEE) AND ONE SON. AS PER HINDU SUCC ESSION ACT 1956 THE PROPERTY OF MRS. KRISHAN NANDA DEVOLVED ON MRS. PRAVEENA HOON (ASSESSEE) IN 1/12 TH SHARE ON MS. SITA NANDA IN 5/12 TH SHARE MRS. JAYANTI KHANDURI IN 1/12 TH AND ON MR. RAJIV KRISHAN NANDA IN 5/12 SHARES. THE PROPERTY WAS SOLD FOR RS. 3 CRORES . AS PER SALE DEED THE ASSESSEE WAS GIVEN SALE CONSIDERATION OF RS. 25 LAC S FOR HER SHARE IN THE PROPERTY SOLD OUT. DURING THE COURSE OF ASSESSM ENT PROCEEDINGS ASSESSEE WAS ASKED TO FURNISH THE COPY OF BANK ACCO UNT IN WHICH THE SALE CONSIDERATION WAS DEPOSITED. ON EXAMINATION OF THE BANK PASS BOOK WITH SYNDICATE BANK IT WAS SEEN THAT THERE WAS A CREDIT ENTRY OF RS. 6 25 000/- ON 8.11.2005. THE ASSESSEE WAS ASKED TO EXPLAIN CREDIT ENTRY OF THIS HIGH VALUE. THE ASSESSEE REPLIED THAT THE AMOUNT WAS RECEIVED AGAINST THE SALE OF FITMENTS WHICH WERE AS SESSEES ASSETS IN THE PROPERTY. THE AO DID NOT AGREE AND HELD THAT TH OSE ASSETS ARE THE ITA NO. 3868/DEL/2011 3 FITTINGS AND FIXTURES HENCE PART AND PARCEL OF THE PROPERTY SOLD. THE AO DID NOT ACCEPT THE CONTENTION OF THE ASSESSEE TH AT THOSE ASSETS WERE PART OF THE PERSONAL PROPERTIES OF THE ASSESSE E. THE AO OBSERVED THAT THESE ASSETS HAVE BEEN SOLD OUT THROUGH THE SA LE DEED OF THE PROPERTY AS THESE WERE RECEIVED INCLUSIVE OF SHARE IN THE PROPERTY THROUGH GIFTS MADE BY MRS. KRISHAN NANDA. THE AO DI D NOT ACCEPT THE EXPLANATION OF THE ASSESSEE THAT THOSE FITTINGS AND FIXTURES HAVE BEEN SOLD BY A SEPARATE AGREEMENT. THE AO HAS TREATED TH IS SEPARATE AGREEMENT FOR SALE OF FITTING AND FIXTURES AS A SEL F SERVING TO AVOID PAYMENT OF STAMP DUTY AND TAX. THE LD. CIT(A) HAS UPHELD THIS ACTION OF THE AO. THE ASSESSEE HAS QUESTIONED THE SAME BEF ORE THE TRIBUNAL. 3. IN SUPPORT OF THE GROUND THE LD. AR REITERATED THE SUBMISSIONS MADE BEFORE THE AUTHORITIES BELOW. HE SUBMITTED THA T THE FURNITURE AND FIXTURES WERE INDEPENDENT MOVABLE PROPERTIES (PERSO NAL EFFECT) HENCE THE AUTHORITIES BELOW WERE NOT JUSTIFIED IN DRAWING AN INFERENCE BASED ON SUSPICION THAT THESE FURNITURE AND FIXTURES WERE PART AND PARCEL OF THE PROPERTY INHERITED. HE SUBMITTED THAT INDEPENDE NT AGREEMENT TO SALE WAS ENTERED INTO FOR SELLING THESE MOVABLE FUR NITURE AND FIXTURES. UNDER THESE FACTS THE SALE CONSIDERATION RECEIVED A GAINST THE SELLING OF THESE FITTINGS AND FIXTURES CANNOT BE TERMED AS CAP ITAL RECEIPT. HE REFERRED PAGE NO. 4 OF THE PAPER BOOK I.E. COPY OF SALE DEED DATED 8 TH FEBRUARY 2006 EXCLUDED BETWEEN ASSESSEE THE OTHE RS AND M/S. ITA NO. 3868/DEL/2011 4 SHIVAM SINGH FOR SALE OF PROPERTY AT NEW FRIENDS CO LONY. THE LD. AR ALSO REFERRED OTHER PAGES OF THE PAPER BOOK I.E. CO PIES OF STATEMENT OF SHRI RAJIV NANDA SHRI RAMAN DEEP SINGH VALUATION REPORT REPLIES TO THE AO CONFIRMATION OF SMT. SHIVANI SINGH RETURN OF INCOME OF THE ASSESEE ETC. THE LD. AR SUBMITTED FURTHER THAT IN C ASE THE SALE CONSIDERATION IN PERSON IS TREATED AS CAPITAL RECEI PT IN THAT CASE BENEFIT OF IDEXATION ALSO BE ALLOWED. HE SUBMITTED ALSO THA T ASSESSEE WAS HOLDING 1/12 TH SHARES HENCE THE ADDITION SHOULD BE RESTRICTED IN THAT BUT PROPORTIONATE ONLY IN THE HANDS OF ASSESEE. 4. THE LD. DR ON THE OTHER HAND TRIED TO JUSTIFY TH E ORDERS OF THE AUTHORITIES BELOW. HE POINTED OUT THERE IS NOT GAP IN DATES OF SALE DEEDS FOR THE PROPERTY AND FITTINGS FIXTURES. HE SU BMITTED THAT FOUR CO- OWNERS WERE THERE OF THE PROPERTY HENCE THE RECEIPT AGAINST SALE OF FITTINGS AND FIXTURES AS PER THE UNDERSTAND AMONGST THE PARTIES HAVE BEEN ALLOCATED EQUALLY. 5. CONSIDERING THE ABOVE SUBMISSIONS WE DO NOT FIND SUBSTANCE IN THE ASSESSMENT OF THE LD. AR THAT FURNITURE AND FIX TURES AND FITTINGS WERE INDEPENDENT MOVABLE PROPERTIES OF THE ASSESSEE IS ESPECIALLY WHEN THE SURROUNDING CIRCUMSTANCES INDICATE OTHERWI SE AND THERE IS NO EVIDENCE TO SUPPORT THE CLAIM OF THE ASSESSEE THAT THESE FURNITURE FITTINGS AND FIXTURES WERE PURCHASED BY HER. THE MA TERIAL FACTS ON THE ITA NO. 3868/DEL/2011 5 ASSESEE SUPPORT THE FINDING OF AUTHORITIES BELOW. S HRI RAJIV NANDA IN HIS STATEMENT HAS ANSWERED SOME SPECIFIC QUESTIONS RAISED TO HIM REGARDING SHARE IN THE RECEIPT AND THE TYPE OF THES E FITTINGS AND FIXTURES. HE WAS ASKED AS TO WHY WAS THE SALE CONSI DERATION RECEIVED FOR FITTINGS AND FIXTURES IS NOT IN THE SAME PROPOR TION AS SHARES IN THE PROPERTY IN THE RECEIPT OF 5/12 5/12 1/2 AND 1/12. HE HAD REPLIED AS BECAUSE THE SHAREHOLDING AS STATED ABOVE WAS FOR T HE IMMOVABLE PROPERTY AND AS FAR AS FITTINGS AND FIXTURES IMMOVA BLE ARE CONCERNED ALL FOUR SIBLINGS HAD EQUAL SHARES IN THEM. IN HIS STATEMENT SHRI RAJIV NANDA HAS ALSO JUSTIFIED THE VALUATION OF FITTINGS AND FIXTURES AT ` ` ` ` 25 00 000/- DETERMINED BY THE VALUER. HE STATED THA T THE MATERIAL / WOOD ETC. USED IN ASSETS FITTED IN THE PROPERTY IS OF VERY HIGH QUALITY AS IT WAS USED IN BETWEEN 1960 & 1970 AND THE VALUE TH EREOF WAS DETERMINED CORRECTLY. THE VALUATION WAS DETERMINED BY SHRI RAM DIP SINGH AN ARCHITECTURE WHO WAS ALSO GOVERNMENT APPRO VED VALUER. HE MADE STATEMENT SHRI RAM DIP SINGH AS JUSTIFIED THE VALUE AND HAS GIVEN DETAILS OF FITTINGS AND FIXTURES AND THEIR VA LUATION. THE FITTINGS AND FIXTURES ARE PART OF MASTER BED ROOM BATHROOM FIXED ARTWORK AND LINTOGRAPH WALL HANGING ETC. HE HAS STATED THAT T HESE FITTINGS AND FIXTURES WERE OLD ANTIQUE AND OF GOOD QUALITY. STA TEMENT OF SHRI RAM DIP SINGH IN THE FORM OF FITTINGS AND FURNITURE HAS BEEN PRODUCED BY THE LD. CIT(A) AT PAGE NO. 5 OF THE FIRST APPELLATE AUTHORITY. HAVING ITA NO. 3868/DEL/2011 6 GONE THROUGH THE SAME IT IS CLEAR THAT FITTINGS AND FIXTURES WERE THE PART AND PARCEL OF THE PROPERTY SOLD OUT. WE THUS F ULLY CONCUR WITH THE FINDING OF THE AUTHORITIES BELOW THAT THE FITTINGS AND FIXTURES WERE THE PART AND PARCEL OF THE PROPERTY AND AGREEMENT OF SA LE OF FITTINGS AND FIXTURES ENTERED INDEPENDENTLY DOES NOT ESTABLISH T HE CLAIM OF THE ASSESEE THAT THE FITTINGS AND FURNITURE WERE MOVABL E AND PERSONAL PROPERTIES OF THE ASSESSEE IN ABSENCE OF ANY EVIDEN CE IN SUPPORT. THE ACTION OF THE AUTHORITY BELOW ON THE ISSUE IS THUS UPHELD WITH THE DIRECTION TO THE AO TO EXTEND THE BENEFIT OF INDEXA TION AS APPLIED IN THE CASE OF SALE OF THE IMMOVABLE PROPERTY TREATING THE SALE CONSIDERATION RECEIVED AGAINST THE FITTINGS AND FURNITURES AS PAR T OF THE SALE CONSIDERATION OF THE PROPERTY. THE ALTERNATIVE ARGU MENT OF THE LD. AR TO THIS EFFECT IS ALLOWED. THE GROUNDS RAISING THE ISSUE OF ADDITION OF ` ` ` ` 6 25 000/- MADE BY THE AO ARE THUS REJECTED. 6. IN THE RESULT THE APPEAL IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 27 TH JULY 2012. SD/- SD/- ( T.S. KAPOOR) ( I.C. SUDHIR ) ACCOUNTANT MEMBER JUDICIAL MEMBER *VEENA COPY OF ORDER FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT(A) 4. CIT 5. DR