Smt Saleem Jahan Ullah,, Meerut v. ACIT, Meerut

ITA 459/DEL/2010 | 2006-2007
Pronouncement Date: 17-02-2012 | Result: Allowed

Appeal Details

RSA Number 45920114 RSA 2010
Assessee PAN AAEPU8789Q
Bench Delhi
Appeal Number ITA 459/DEL/2010
Duration Of Justice 2 year(s) 15 day(s)
Appellant Smt Saleem Jahan Ullah,, Meerut
Respondent ACIT, Meerut
Appeal Type Income Tax Appeal
Pronouncement Date 17-02-2012
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted G
Tribunal Order Date 17-02-2012
Date Of Final Hearing 06-02-2012
Next Hearing Date 06-02-2012
Assessment Year 2006-2007
Appeal Filed On 02-02-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH `G: NEW DELHI BEFORE SHRI I.P. BANSAL JUDICIAL MEMBER AND SHRI K.D. RANJAN ACCOUNTANT MEMBER I.T. A. NO.459/DEL/2010 ASSESSMENT YEAR : 2006-07 SMT. SALEEM JAHAN ULLAH ASSTT. COMMISSIONER OF I NCOME-TAX 444 BEGUM BRIDGE VS. CIRCLE-I MEERUT. MEERUT. PAN NO. AAEPU8789Q I.T. A. NO.4872/DEL/2011 ASSESSMENT YEAR : 2006-07 ASSTT. COMMISSIONER OF INCOME-TAX SMT. SALEEM JAHA N ULLAH CIRCLE-2 MEERUT. VS. 444 BEGUM BAGH MEERUT. (APPELLANTS) (RESPONDE NTS) ASSESSEE BY : SHRI O.P. SAPRA ADVOCATE DEPARTMENT BY : SMT. ANUSHA KHUR ANA DR. O R D E R PER K.D. RANJAN ACCOUNTAT MEMBER: THESE APPEALS BY THE ASSESSEE AND REVENUE FOR ASSES SMENT YEAR 2006-07 ARISE OUT OF THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS) MEERUT. THE APPEAL BY THE ASSESSEE IS A GAINST QUANTUM ADDITION 2 WHEREAS THE APPEAL BY THE REVENUE IS AGAINST CANCEL LATION OF PENALTY UNDER SEC. 271(1)(C) OF THE ACT. 2. THE GROUNDS OF APPEAL IN ITA NO.459/DEL/2010 ARE REPRODUCED AS UNDER:- 1. THAT THE LD. CIT(A) HAS WRONGLY CONFIRMED THE A VERAGE RATE OF RS.135/- PER SQ. METER AS FAIR MARKET VALUE OF T HE LAND AS ON 01.04.1981 BASED ON THE ALLEGED CIRCLE RATES ALLEG EDLY CERTIFIED BY THE ADM(F) MORADABAD BECAUSE:- (A) THE COPY OF SUCH CIRCLE AREA RATES BETWEEN 110-160 PER SQ. MTR. ALLEGEDLY CERTIFIED BY ADM(F) MORADABAD HAD NE VER BEEN SUPPLIED BY THE LD. A.O. TO THE APPELLANT THO UGH SHOWN TO HER COUNSEL DURING ASSESSMENT PROCEEDINGS. (B) THE LD. CIT(A) HAD WRONGLY IGNORED THE CERTIFIED CI RCLE AREA RATES FILED BEFORE HIM BY THE APPELLANT WHICH WERE DULY TAKEN NOTE OF VIDE PARA 3 AT PAGE 9 OF THE APPELLAT E ORDER RANGING BETWEEN 400-600 PER SQ. MTR. (C) VARIOUS SUBMISSIONS MADE BY THE APPELLANT HAD EITHE R BEEN IGNORED OR HAD NOT BEEN GIVEN DUE WEIGHT. (D) THE CIRCLE AREA RATE CANNOT LEGALLY BE APPLIED FOR WORKING OUT FAIR MARKET VALUE OF AN ASSET AS ON 01.04.1981 FOR CALCULATION OF CAPITAL GAINS THEREON. 2. THAT THE LONG TERM CAPITAL GAIN AS DECLARED BY T HE APPELLANT OUGHT TO HAVE BEEN ACCEPTED THEREBY ACCEPTING THE COST OF ACQUISITION AS ON 01.04.1981 AS SHOWN BY THE APPELL ANT. 3. THAT WITHOUT PREJUDICE TO GROUND NO. 1 & 2 ABOVE THE LONG TERM CAPITAL GAIN AS ASSESSED IS ARBITRARY UNJUST AND HIGHLY EXCESSIVE. 3 3. THE FACTS OF THE CASE STATED IN BRIEF ARE THAT T HE ASSESSEE AN INDIVIDUAL ADMITTED INCOME FROM LONG TERM CAPITAL GAINS BY SAL E OF PROPERTY SITUATED AT 426 BANO BAGH CIVIL LINES MORADABAD. THE ASSESS EES SHARE IN THIS PROPERTY WAS 19/48 OR 114 SIHAM OUT OF TOTAL 384 SI HAM AS DETERMINED BY THE ORDER OF CIVIL COURT MORADABAD. THIS PROPERTY WAS ACQUIRED BY ASSESSEES FATHER HAMEED ULLAH KHAN SAHEB IN THE NA ME OF HIS FOUR CHILDREN. TOTAL AREA OF THE PROPERTY WAS 11097.60 SQ. MTRS. OUT OF WHICH A PART MEASURING 1602.43 SQ. MTRS. WAS SOLD ON 30 TH NOVEMBER 2000. OUT OF REMAINING AREA OF 9023.59 SQ. MTRS. 3/4 TH PORTION OF WHOLE AREA MEASURING 6767.69 SQ. MTRS. WAS SOLD ON 9.03.2006. THE ASSES SEE HAD RECEIVED SALE CONSIDERATION OF RS.2 14 30 960/- (HER SHARE) OUT O F TOTAL SALE CONSIDERATION OF RS.5 41 41 440/-. THE STAMP DUTY VALUATION OF T HE PROPERTY WAS RS.5 46 50 000/-. THE ASSESSING OFFICER ADOPTED TH E FULL VALUE OF CONSIDERATION AT RS.5 46 50 000/- UNDER SEC. 50C OF THE INCOME-TAX ACT 1961 AND DETERMINED THE FULL VALUE OF CONSIDERATION IN ASSESSEES HANDS AT RS.2 16 32 292/-. 4. THE ASSESSEE IN ORDER TO ARRIVE AT CAPITAL GAINS ADOPTED THE RATE OF RS.700/- PER SQ. METER AS COST OF LAND AS ON 1.04.1 981 AS AGAINST THE AO HAS ADOPTED RATE OF RS.135/- PER SQ. MTR. WHILE REJECT ING THE ADOPTION OF RATE OF RS.700/- PER SQ. MTR. BY THE REGISTERED VALUER THE AO HAS MENTIONED THAT 4 NO INVESTIGATION TO ASCERTAIN THE FAIR MARKET VALUE AS ON 1.04.1981 WAS CARRIED OUT. THEREFORE THE RATE OF RS.700/- PER S Q. METER WAS ADOPTED ARBITRARILY. NO SUPPORTING DOCUMENTS HAVE BEEN FIL ED BY THE VALUER IN SUPPORT OF HIS VALUATION. THE AO ON THE OTHER HAND OBTAINED CIRCLE RATES AS ON 1.04.1981 AS NOTIFIED BY THE ADM(FINANCE) MORAD ABAD. THE ASSESSING OFFICER AFTER AFFORDING OPPORTUNITY OF BEING HEARD TO THE ASSESSEE ADOPTED FAIR MARKET VALUE OF THE PROPERTY AS ON 1.04.1981 A T RS.3 88 691/-. HE ACCORDINGLY DETERMINED THE LONG TERM CAPITAL GAINS. 5. BEFORE CIT(A) IT WAS SUBMITTED THAT PART OF THE PROPERTY WAS SOLD DURING PREVIOUS YEAR 2000-01 RELEVANT TO THE ASSESS MENT YEAR 2001-02 AND AT THAT TIME THE FAIR MARKET VALUE OF PROPERTY AS ON 1.4.1981 WAS ESTIMATED BY THE REGISTERED VALUER BY ADOPTING LAND RATE @ RS .700/- PER SQ. MTR. WHICH HAS BEEN ADOPTED BY THE PRESENT VALUER. THE CAPITAL GAIN CALCULATIONS IN ASSESSMENT YEAR 2001-02 WERE MADE BY SUBSTITUTIN G THE FAIR MARKET VALUE OF THE PROPERTY AS ON 1.04.1981. IT WAS THEREFORE SUBMITTED THAT THE SAME VALUE AS ON 1.04.1981 WAS ADOPTED IN THE YEAR UNDER CONSIDERATION. IT WAS ALSO SUBMITTED THAT AS PER THE RATE-LIST THE CIRCLE RATES IN THE AREA OF CIVIL LINES (EAST) (AT SL.NO.81 OF THE RATE-LIST AT PAGE 39) WERE RANGING BETWEEN RS.400/- TO RS.600/- PER SQ. METER. THE NOTING OF THE AO THAT THE ASSESSEE WAS REQUIRED TO PROVIDE CIRCLE RATES AS ON 1.04.198 1 IS FACTUALLY INCORRECT. 5 AS PER COUNSEL OF THE ASSESSEE THE CIRCLE RATES APP LICABLE IN THE AREA WERE NEVER ASKED FOR FROM HIM. HE ALSO SUBMITTED THAT T HE AVERAGE RATE OF THE AREA WAS NOT BASED ON ANY LEGAL PRINCIPLE AND THE L OCATION OF THE PROPERTY SOLD BEING PRIME THE CIRCLE RATES APPLICABLE TO TH E PROPERTY WERE TO BE ADOPTED. THE ASSESSEE THEREFORE SUBMITTED THAT AP PLICATION OF AVERAGE RATE OF RS.135/- PER SQ. MTR. OR RATE OF RS.400-600 IS T OTALLY UNJUSTIFIED AND UNLAWFUL. IT WAS ALSO PLEADED BY THE ASSESSEE THAT APPLICATION OF SEC. 50C FOR WORKING OUT THE FAIR MARKET VALUE AS ON 1.04.19 81 OF THE PROPERTY SOLD SUBSEQUENTLY IS NOT CORRECT. 6. THE LEARNED CIT(A) ON CONSIDERATION OF ABOVE FAC TS HELD THAT THE WORKING OF VALUATION OF PROPERTY AS ON 1.04.1981 BY THE AO WAS BASED ON RATES APPLICABLE WHICH WERE OBTAINED FROM THE CONCE RNED AUTHORITIES. THE VALUATION OFFICER HAD NOT GIVEN ANY DIRECT EVIDENCE TO SUPPORT THE RATE OF RS.700/- PER SQ. MTR. THE LEARNED CIT(A) THEREFORE UPHELD THE FAIR MARKET VALUE AS ON 1.04.1981 BY APPLYING THE AVERAGE RATE OF RS.135/- PER SQ. METER. 7. BEFORE US THE LEARNED AUTHORIZED REPRESENTATIVE OF THE ASSESSEE SUBMITTED THAT FOR ASSESSMENT YEAR 2001-02 WHEN PAR T OF THE PROPERTY WAS SOLD THE SAME RATE WAS APPLIED WHICH STANDS ACCEPT ED BY THE DEPARTMENT. WHEN ASSESSEE HAS APPLIED THE SAME RATE FOR THE ASS ESSMENT YEAR UNDER CONSIDERATION THE AO HAS REJECTED THE RATES APPLIE D AND ACCEPTED BY THE 6 DEPARTMENT. HE ALSO REFERRED TO THE RATES WHICH AR E APPLICABLE FOR THE AREA. THE LEARNED AR OF THE ASSESSEE THEREFORE SUBMITTED THAT AVERAGE RATE APPLIED BY THE AO IS NOT CORRECT. ON THE OTHER HAN D THE LEARNED DR SUPPORTED THE ORDER OF THE CIT(A). 8. WE HAVE HEARD BOTH THE PARTIES AND GONE THROUGH THE MATERIAL AVAILABLE ON RECORD. THERE IS NO DISPUTE ABOUT THE FACT THAT FOR ASSESSMENT YEAR 2001-02 WHEN ASSESSEE SOLD PART OF THE PROPERT Y THE CAPITAL GAINS WERE WORKED OUT BY ADOPTING VALUE OF PROPERTY AS ON 1.04 .1981 @ RS.700/- PER SQ. METER. THE ASSESSMENT FOR ASSESSMENT YEAR 2001 -02 WAS MADE UNDER SEC. 143(1) OF THE ACT. THEREFORE ACCEPTANCE OF R ETURN UNDER SEC. 143(1) WILL NOT AMOUNT TO ACCEPTANCE OF THE FAIR MARKET VA LUE AT RS.700/- PER SQ. METER. THE ASSESSEE HAD FILED COPY OF CIRCLE RATES APPLICABLE TO CIVIL LINES (WEST) RANGING BETWEEN RS.110-160 WHICH HAS BEEN AP PLIED BY THE AO. THE ASSESSEE HAS FILED LIST OF CIRCLE RATES FOR DIFFERE NT LOCALITIES INCLUDING CIVIL LINE (EAST) WHERE RATE IS VARYING FROM RS.400/- TO RS.600/- PER SQ. METER. FROM ABOVE FACTS IT IS NOT CLEAR WHETHER THE RATE A PPLICABLE AS ON 1.04.1981 IS BETWEEN RS.400/- AND RS.600/- OR RS.700/- PR SQ. METER AS ADOPTED BY THE REGISTERED VALUER OR WAS RANGING BETWEEN RS.110/- T O RS.160 PER SQ. METER. THE AO HAS ADOPTED AVERAGE RATE OF CIVIL LINES (WES T). FROM THE LETTER OF THE ADM (FINANCE AND REVENUE) THE CIRCLE RATE WAS BETWEEN RS.110/- AND 7 RS.160/- PER SQ. METER. ON THE OTHER HAND RATE-LI ST OF CIVIL LINE (EAST) AS PER RATES PROVIDED BY TEHSILDAR MORADABAD APPROVE D BY THE COLLECTOR VARIED FROM RS.400/- TO RS.600/-. WE THEREFORE F EEL IT PROPER TO SET ASIDE THE MATTER TO THE FILE OF THE ASSESSING OFFICER WIT H THE DIRECTION TO EXAMINE THE EXACT LOCATION OF THE PROPERTY AND THE FAIR MAR KET VALUE APPLICABLE FOR THE PURPOSE OF DETERMINATION OF COST OF ACQUISITION AS ON 1.04.1981. THE ASSESSING OFFICER MAY CALL FOR THE SALE INSTANCES O F NEARBY PROPERTIES DURING THE PERIOD IN ORDER TO ASCERTAIN THE FAIR MARKET VA LUE AS ON 1.04.1981. THE ASSESSING OFFICER WILL DECIDE THE ISSUE AFRESH AFTE R AFFORDING THE ASSESSEE A REASONABLE OPPORTUNITY OF BEING HEARD. ITA NO.4872/DEL/2011 9. THE ONLY ISSUE FOR CONSIDERATION IN THIS APPEAL RELATES TO THE DELETION OF PENALTY OF RS.15 44 751/- IN RESPECT OF LONG TER M CAPITAL GAINS. THE ASSESSING OFFICER IMPOSED PENALTY ON DIFFERENCE OF PRICE ADOPTED BY HIM FOR THE PURPOSE OF COMPUTATION OF CAPITAL GAINS AND THE DIFFERENCE OF CAPITAL GAINS ADMITTED BY THE ASSESSEE. 10. THE LEARNED CIT(A) HAS DELETED THE PENALTY RELY ING ON THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF DHARMENDRA TEX TILE PROCESSORS (2007) 306 ITR 277. 8 11. DURING THE COURSE OF HEARING WHEN MATTER CAME U P FOR HEARING THE LEARNED AR OF THE ASSESSEE AGREED FOR SETTING ASIDE OF APPEAL AGAINST PENALTY PROCEEDINGS SINCE THE QUANTUM APPEAL HAS BEEN SET A SIDE. 12. WE HAVE CONSIDERED THE SUBMISSIONS MADE BY BOTH THE PARTIES. SINCE WE HAVE SET ASIDE QUANTUM APPEAL TO THE FILE OF THE ASSESSING OFFICER THE ISSUE OF LEVY OF PENALTY IS ALSO SET ASIDE TO THE F ILE OF THE AO WITH THE DIRECTIONS TO RECONSIDER THE PENALTY TO BE IMPOSED IF ANY AFTER CONSIDERING THE ISSUE RELATING TO QUANTUM ADDITION. 13. IN THE RESULT THE APPEALS FILED BY THE ASSESSE E AND ALSO BY THE REVENUE ARE ALLOWED FOR STATISTICAL PURPOSES. 14. THIS DECISION IS PRONOUNCED IN THE OPEN COURT O N 17 TH FEBRUARY 2012. SD/- SD/- (I.P. BANSAL) (K.D. RANJAN) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 17 TH FEBRUARY 2012. COPY OF THE ORDER FORWARDED TO:- 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR BY ORDER *MG DEPUTY REGISTRAR ITAT.