Madhu Sudan Yadav, v. ITO Ward I,

ITA 4961/DEL/2007 | 2004-2005
Pronouncement Date: 21-01-2011 | Result: Allowed

Appeal Details

RSA Number 496120114 RSA 2007
Assessee PAN AABPY2605A
Bench Delhi
Appeal Number ITA 4961/DEL/2007
Duration Of Justice 3 year(s) 1 month(s) 4 day(s)
Appellant Madhu Sudan Yadav,
Respondent ITO Ward I,
Appeal Type Income Tax Appeal
Pronouncement Date 21-01-2011
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted D
Tribunal Order Date 21-01-2011
Date Of Final Hearing 17-01-2011
Next Hearing Date 17-01-2011
Assessment Year 2004-2005
Appeal Filed On 17-12-2007
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES D: NEW DELHI BEFORE SHRI I.P. BANSAL JUDICIAL MEMBER AND SHRI A.K. GARODIA ACCOUNTANT MEMBER ITA NO. 4961/DEL/2007 ASSESSMENT YEAR: 2004-05 MADHU SUDAN YADAV VS. INCOME TAX OFFICER S/O SH. NAWAL SINGH YADAV WARD-1 REWARI C/O M/S YADAV BOOK DEPOT HARYANA. MOTI CHOWK REWARI HARYANA. AABPY2605A (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI AJAY WADHWA ADV. RESPONDENT BY : SHRI A. K. MONGA DR ORDER PER I.P. BANSAL J.M. THIS IS AN APPEAL FILED BY THE ASSESSEE. IT IS DI RECTED AGAINST THE ORDER DATED 16 TH OCTOBER 2007 PASSED BY LD. CIT(A) IN RESPECT OF A .Y. 2004-05. GROUNDS OF APPEAL READ AS UNDER: - 1. THAT THE LD. CIT(A) ROHTAK HAS ERRED IN NOT C ONSIDERING THE FOLLOWING PLEA OF THE APPELLANT: - A. THE PROVISIONS OF SEC. 50C(1) ARE NOT APPLICABL E IN THE APPELLANT CASE. B. THE MARKET VALUE OF THE PROPERTY WHICH WAS REAL LY IN DISPUTE AS PER PRESCRIPTION IN THE PURCHASE DEED ITSELF SHOULD BE ADOPTED INSTEAD OF CIRCLE RATE VALUE. C. THE REQUEST TO GET IT VALUED AND SPOT VISIT HAS NOT BEEN CONSIDERED. ITA NO. 4961/D/07 2 2. THAT THE LD. CIT(A) HAS FURTHER ERRED IN TREATI NG THE VALUATION REPORT OF THE ASSESSEE AN ADDITIONAL EVIDENCE AND REJECTING THE S AME IS QUITE ARBITRARY AGAINST LAW AND FACTS OF THE CASE. 3. THAT THE LD. CIT(A) IBID HAS FURTHER ERRED IN N OT ADMITTING THE INVESTMENT OF RS. 725000/- IN CAPITAL GAIN BOND AS THE SAME WE RE INVESTED IN THE PURCHASE OF THE RESIDENTIAL HOUSE WITHIN TIME DOCU MENTS ARE VERY WELL ON RECORD. 4. THAT ADMITTING THE VERSION OF THE AO BY LD. CIT (A) THAT RESIDENTIAL HOUSE BEARING NO. 28-P MODEL TOWN PURCHASED IN TWO PARTS ARE TWO HOUSES INSTEAD OF ONE HOUSE PURCHASE IN TOW PARTS IS QUITE ARBITRARY AND AGAINST THE FACTS AND VERSION OF THE PURCHASE DEED. FURTHER RE JECTING THE CLAIM OF SEC. 54F(4) IS AGAINST LAW AND FACTS OF THE CASE. 2. THE ASSESSEE SOLD TWO PROPERTIES FOR AN AGGREGAT E AMOUNT OF RS. 13 LAKH AS AGAINST AGGREGATED VALUE ADOPTED FOR STAMP ISSUE PURPOSES OF RS. 30 64 000/- THE DETAILS ARE AS UNDER: - 1. SALE DEED NO. 688134 FOR RS. 6 00 000/- VALUE ADOPTED FOR THE PAYMENT OF STAMP DUTY B Y STATE GOVT. OF THE ABOVE PLOT AT RS. 1664000/- 2. SALE DEED NO. JDD-688234 DT. 08.09.2003 FOR RS. 7 00 000/- VALUE OF THE ABOVE PLOT IS TAKEN AT RS. 14 00 0 00/- BY THE STATE GOVT. FOR PAYMENT OF STAMP DUTY. 3. THE AO ISSUED SHOW CAUSE NOTICE TO THE ASSESSEE THAT WHY ACCORDING TO SEC. 50C(1) THE VALUE ADOPTED FOR STAM P PURPOSES SHOULD NOT BE TAKEN AS SALE CONSIDERATION. THE REPLY OF THE A SSESSEE AS SUBMITTED TO AO AND AS REPRODUCED AT PAGE 3 OF THE ASSESSMENT OR DER IS AS UNDER: - ITA NO. 4961/D/07 3 REGARDING ADOPTION OF STAMP DUTY VALUE OF THE PROPERTY IT IS SUBMITTED THAT THE CIRCLE RATES UNDE R STAMP RULES FIXED BY THE COLLECTOR ARE NOT FINAL BUT IT I S ONLY A PRIMA- FACIE DETERMINATION RATE OF THAT AREA CONCERNED ONL Y TO GIVE GUIDANCE TO THE REGISTERING AUTHORITY FOR COLLECTIN G OF STAMP DUTY. PROPERTY SALES RATES MAY BE ON LOWER SIDE AS PER RATES PREVAILING AT THAT TIME AND OTHER CIRCUMSTANCES LIK E RENTED PROPERTY OR PROPERTY UNDER LITIGATION. IN MY CASE THE OVER ALL PROPERTY WAS UNDER LITIGATION WITH THE ONE NAMED RO SHAN LAL AS PER ASSETS CHART PRESCRIPTION. OUT OF THAT LITI GATED PROPERTY THE PROPERTY IN QUESTION WAS SOLD. EVEN I T YOUR GOOD-SELF GET VALUED THE SAID ALL THESE ASSETS THE VALUE SHALL ON LOWER SIDE AS PER STAMP DUTY FIXATION RATES. SO THE PROVISIONS OF SEC. 50C ARE NOT ALL APPLICABLE IN MY CASE. 4. THE AO REJECTED THE REPLY OF THE ASSESSEE ON THE GROUND THAT IN SALE DEEDS THERE WAS NO DESCRIPTION OF LITIGATION ON TH E PROPERTY SOLD BY THE ASSESSEE AND THEREFORE HE ADOPTED THE SALE CONSID ERATION AS STATED IN THE SALE DEEDS AND ACCORDINGLY CALCULATED THE CAPITAL G AIN. 5. BEFORE CIT(A) THE ASSESSEE HAD SUBMITTED A VALU ATION REPORT AND IT WAS CLAIMED THAT THE SAME MAY BE ACCEPTED AS ADDITI ONAL EVIDENCE TO SUPPORT THE CONTENTION THAT THE SALE CONSIDERATION STATED IN THE REGISTERED DEED WERE ACTUAL CONSIDERATION. LD. CIT(A) HAS REJ ECTED THE ADMISSION OF ADDITIONAL EVIDENCE AND HAS UPHELD THE ACTION OF TH E AO. THE ASSESSEE IS AGGRIEVED HENCE IN APPEAL. ITA NO. 4961/D/07 4 6. IT HAS BEEN THE MAIN CONTENTION OF LD. AR THAT S EC. 50C(2) ITSELF GIVES OPTION TO THE ASSESSEE TO RAISE AN OBJECTION WHERE BY ASSESSEE CAN CLAIM THAT THE VALUE ADOPTED OR ASSESSABLE BY THE STAMP V ALUATION AUTHORITY EXCEEDS THE FARE MARKET VALUE OF THE PROPERTY AS ON THE DATE OF TRANSFER AND IN THAT CASE THE AO HAS AN AUTHORITY TO REFER THE S AME TO THE VALUATION OF THE CAPITAL ASSET TO THE VALUATION OFFICER. THUS HE S UBMITTED THAT THE ASSESSEE HAVING RAISE THE OBJECTION BEFORE THE AO IT WOULD BE FAIR ON THE PART OF THE AO TO REFER THE MATTER TO THE VALUATION. HE SUBMIT TED THAT SUCH RECOURSE HAS NOT BEEN ADOPTED BY THE AO. A VALUATION REPORT FROM REGISTERED VALUER HAS BEEN OBTAINED. HE SUBMITTED THAT IN THE VALUAT ION REPORT IT IS CLEARLY STATED THAT THE SOLD PROPERTY WAS IN OCCUPATION OF THE THIRD PARTY AND HENCE ITS VALUE WAS LOW. THUS HE SUBMITTED THAT LD. CIT (A) HAS WRONGLY REJECTED THE CLAIM OF THE ASSESSEE REGARDING ADMISSION OF TH E ADDITIONAL EVIDENCE. HE SUBMITTED THAT IT IS A MATTER OF FACT THAT THE P ROPERTY WHEN SOLD WAS UNDER OCCUPATION OF THIRD PARTY AND THEREFORE IT COULD NOT FETCH MARKET PRICE. HE SUBMITTED THAT IT WILL BE IN THE FITNESS OF THE THING IF THE MATTER IS RESTORED TO THE FILE OF AO WITH A DIRECTION TO MAKE PROPER VERIFICATION AND TO REFER THE VALUATION TO THE VALUATION OFFICER IN ACC ORDANCE WITH THE PROVISIONS OF SEC. 50C(2) AND THEN RE-ADJUDICATE THE ISSUE AFT ER GIVING THE ASSESSEE A REASONABLE OPPORTUNITY OF HEARING. 7. ON THE OTHER HAND LD. DR RELYING UPON THE ASSES SMENT ORDER AS WELL AS ORDER OF CIT(A) PLEADED THAT HIS ORDER SHOULD B E UPHELD. ITA NO. 4961/D/07 5 8. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIO NS IN THE LIGHT OF MATERIAL PLACED BEFORE US. THE REPLY OF THE ASSESS EE AS FILED BEFORE AO HAS ALREADY BEEN REPRODUCED. IT WAS CLEARLY STATED BY THE ASSESSEE THAT THE LOWER SALE PRICE WAS REALIZE BY THE ASSESSEE ON ACC OUNT OF LITIGATION WITH ONE NAMED ROSHAN LAL AND THUS THE ASSESSEE HAS RAI SED A PRELIMINARY OBJECTION TO THE ASSESSING OFFICER REGARDING VALUAT ION ADOPTED BY STAMP VALUATION AUTHORITY AND IN THAT CASE THE AO SHOULD HAVE REFERRED THE VALUATION TO THE VALUATION OFFICER. RATHER THE AO H AS REJECTED THE CONTENTION OF THE ASSESSEE ON THE FACE OF IT WITHOUT MAKING AN Y ENQUIRY INTO THE FACTS. IN THE VALUATION REPORT FILED BY THE ASSESSEE BEFOR E CIT(A) A COPY OF WHICH IS PLACED AT PAGE 18 TO 22 OF THE PAPER BOOK IN COL UMN 24 IT HAS BEEN CLEARLY STATED THAT THE PROPERTY IS FULLY OCCUPIED BY SH. ROSHAN LAL S/O SHRI SEO NARIAN. KEEPING IN VIEW ALL THESE FACTS WE AR E OF THE OPINION THAT IT WILL MEET THE INTEREST OF JUSTICE IF THE MATTER IS REST ORED BACK TO THE FILE OF AO WITH A DIRECTION TO MAKE ENQUIRY INTO A CLAIM OF TH E ASSESSEE AND REFER THE ISSUE TO THE VALUATION OFFICER AND AFTER OBTAINING SUCH VALUATION REPORT GIVE OPPORTUNITY TO THE ASSESSEE TO SUBSTANTIATE HIS CAS E AND THEN TO RE- ADJUDICATE THE ISSUE AFTER ADOPTING SUCH PROCESS. WE DIRECT ACCORDINGLY. GROUND NO. 1 AND 2 ARE ALLOWED IN THE MANNER AFORES AID FOR STATISTICAL PURPOSES. ITA NO. 4961/D/07 6 9. SO AS IT RELATES TO GROUND NO. 3 & 4 THE AMOUNT INVESTED BY THE ASSESSEE IN HOUSE IS TREATED AS INVESTMENT IN TWO H OUSES. THEREFORE THE CLAIM OF THE ASSESSEE U/S 54F(4) IS DENIED. IT IS THE CASE OF THE ASSESSEE THAT THE SAID HOUSE IS ONE AND WAS PURCHASED IN TWO PARTS AND CANNOT BE TREATED TO BE TWO HOUSES. IT WAS SUBMITTED THAT TH E PROPERTY IS ONE WHICH IS 28-P MODEL TOWN AND CANNOT BE CONSIDERED TO BE TWO HOUSES. IT WAS SUBMITTED THAT THIS ISSUE ALSO MAY BE RESTORED BACK TO THE FILE OF AO FOR CONDUCTING ENQUIRY INTO THE CLAIM OF THE ASSESSEE A ND AFTER CONDUCTING SUCH ENQUIRY AND AFTER GIVING ASSESSEE A REASONABLE OPPO RTUNITY OF HEARING THE MATTER MAY BE RE-ADJUDICATED. 10. ON THE OTHER HAND LD. DR RELIED UPON THE ORDER OF AO AND CIT(A). 11. AFTER HEARING BOTH THE PARTIES WE ARE OF THE O PINION THAT IF IT IS A ONE HOUSE PURCHASED IN TWO PARTS AND THE ASSESSEE IS FU LFILLING ALL THE CONDITIONS THEN ASSESSEE CANNOT BE SAID TO HAVE PURCHASED TWO HOUSES BUT THIS A MATTER OF FACT FOR WHICH AN ENQUIRY IS NEEDED TO BE MADE. THEREFORE WE RESTORE THIS ISSUE TO THE FILE OF AO FOR RE-ADJUDIC ATION OF THE SAME. IF THE HOUSE IS ONE AND ASSESSEE IS FULFILLING THE CONDITI ONS THEN EXEMPTION SHOULD BE GRANTED TO THE ASSESSEE. THE AO WILL ASCERTAIN THE FACT AND AFTER ASCERTAINING THE FACT HE WILL PROVIDE A REASONABLE OPPORTUNITY OF HEARING TO THE ASSESSEE AND THEREAFTER RE-ADJUDICATE THE ISSUE AS INDICATED ABOVE. FOR STATISTICAL PURPOSES THESE GROUNDS ARE TREATED TO BE ALLOWED. ITA NO. 4961/D/07 7 12. IN THE RESULT THE APPEAL IS ALLOWED FOR STATIS TICAL PURPOSES IN THE MANNER AFORESAID. ORDER PRONOUNCED IN THE OPEN COURT ON 21.1.11 (A.K. GARODIA) (I.P. BANSAL) ACCOUNTANT MEMBER JUDICIAL MEMBER * KAVITA DATED: COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR TRUE COPY BY ORDER DEPUTY REGISTRAR ITAT