M/s. Krishi Yantralaya, SRIGANGANAGAR v. ACIT, SRIGANGANAGAR

ITA 57/JODH/2010 | 2007-2008
Pronouncement Date: 22-03-2011 | Result: Allowed

Appeal Details

RSA Number 5723314 RSA 2010
Assessee PAN AABFK0488P
Bench Jodhpur
Appeal Number ITA 57/JODH/2010
Duration Of Justice 1 year(s) 1 month(s) 23 day(s)
Appellant M/s. Krishi Yantralaya, SRIGANGANAGAR
Respondent ACIT, SRIGANGANAGAR
Appeal Type Income Tax Appeal
Pronouncement Date 22-03-2011
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted DB
Tribunal Order Date 22-03-2011
Date Of Final Hearing 10-02-2011
Next Hearing Date 10-02-2011
Assessment Year 2007-2008
Appeal Filed On 29-01-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL JODHPUR BENCH JODHPUR BEFORE SHRI S.V. MEHROTRA A.M. AND SHRI V. DURGA R AO J.M. ITA NO. 57/JU/2010 ASSESSMENT YEAR: 2007-08 M/S KRISHI YANTRALAYA APPELLANT SHOP NO. 150 OLD TRACTOR MARKET GURUDWARA ROAD SRI GANGANAGAR RAJASTHAN 335 001 (PAN AABFK0488P) VS. THE ASSTT. COMMISSIONER OF INCOME-TAX RESPONDENT CIRCLE SRI GANGANAGAR SRI GANGANAGAR. APPELLANT BY : MR. SURESH OJHA RESPONDENT BY : MR. AMIT NIGAM . ORDER PER V. DURGA RAO J.M.: THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST THE ORDER OF CIT(A) BIKANER PASSED ON 22/12/2009 FOR THE ASSES SMENT YEAR 2007- 08 WHEREIN THE ASSESSEE HAS RAISED THE FOLLOWING G ROUNDS OF APPEAL:- 1. THAT THE WORTHY CIT(A) BIKANER WAS NOT JUSTIFIE D IN CONFIRMING THE ADDITION OF RS. 5 38 534/- MADE BY T HE LD. ACIT WHO MADE THE AFORESAID ADDITION BY ADOPTING THE DLC VALUE AS AGAINST REAL AND ACTUAL SALE CONSIDERATION PASSED B ETWEEN THE ASSESSEE-APPELLANT FIRM AND BUYER PARTY FOR THE PUR POSES OF COMPUTING CAPITAL GAIN. 2. THAT THE LEARNED CIT AS WELL AS THE CIT(A) WERE NOT JUSTIFIED IN CONFIRMING THE ADDITION OF RS. 5 38 534/- BY NOT AP PRECIATING THE EVIDENCES FILED BY THE ASSESSEE-APPELLANT FIRM DURI NG THE COURSE OF ASSESSMENT PROCEEDINGS. ITA NO. 57/JU/2010 M/S KRISHI YANTRALAYA 2 2. THE AO NOTED THAT THE ASSESSEE HAD FURNISHED A C OPY OF THE SALE DEED DATED 29/03/07 IN RESPECT OF GODOWN SITUATED A T PLOT NO. B-2 TRACTOR AND AUTOMOBILES SCHEME SURATGARH ROAD SRI GANGANAGAR WHEREIN THE SUB-REGISTRAR HAD ADOPTED THE DLC RATE OF RS. 15 63 534/- AS AGAINST SALE VALUE OF RS. 10 25 000/ - DECLARED BY THE ASSESSEE FOR CALCULATING THE CAPITAL GAINS. ON BEIN G ASKED THE ASSESSEE SUBMITTED A COPY OF THE VALUATION REPORT F ROM A REGISTERED VALUER VALUING THE PROPERTY AT RS. 11 93 000/-. WHE N THE AO ASKED THE ASSESSEE TO PROVE THE MARKET RATE OF THE PROPER TY IN QUESTION THE ASSESSEE REPLIED THAT THE RATE ACCORDING TO THE REG ISTERED SALE DEED CAME TO RS. 475 PER SQ.FEET AS AGAINST RS. 724/- PE R SQ.FT AS PER THE DLC RATE AND SALE INSTANCES OF SHOP NO. M-19 AND M- 29 IN THE SAME MARKET AT RS. 525/- SQ.FT. AND RS. 500 PER SQ.FT. T HE ASSESSEES EXPLANATION WAS REJECTED BY THE AO ON THE GROUND TH AT THE EVEN IN THE COMPARABLE CASES WAS DONE BY THE REGISTRATION A UTHORITY SRIGANGANAGAR AT ENHANCED VALUE OF THE DLC RATE WHI CH WAS RS. 635/- PER SQ.FT. HENCE THE AO ADOPTED THE DLC RATE FOR T HE PURPOSE OF CALCULATING THE CAPITAL GAIN. AGGRIEVED THE ASSESS EE CARRIED THE MATTER IN APPEAL BEFORE THE CIT(A). 3. BEFORE THE CIT(A) THE ASSESSEE SUBMITTED THAT T HE AO WAS NOT JUSTIFIED IN ADOPTING DLC RATE SPECIALLY IN VIEW OF SECTION 50C(2). IT WAS SUBMITTED THAT WHERE THE ASSESSEE CLAIMED THAT THE VALUE ADOPTED BY THE STAMP VALUATION OFFICER EXCEED THE FAIR MARK ET VALUE THE MATTER OUGHT TO HAVE BEEN REFERRED TO THE VALUATION OFFICER. IT WAS ALSO SUBMITTED THAT SINCE THE ASSESSEE HAD PROVIDED COMP ARABLE SALE INSTANCES AND ALSO A COPY OF THE VALUATION REPORT T O SHOW THAT THE DLC RATES WERE MORE THAN THE FAIR MARKET VALUE AND THE MATTE COULD HAVE BEEN RESOLVED BY MAKING A REFERENCE TO THE VAL UATION OFFICER AND SINCE THE SAME WAS NOT DONE THE ADOPTION OF DL C RATES BY THE AO WAS NOT JUSTIFIED. AFTER CONSIDERING THE SUBMISS IONS OF THE ASSESSEE THE CIT(A) CONFIRMED THE ADDITION MADE BY THE AO BY OBSERVING THAT ONCE THE DLC RATES WERE AVAILABLE WH ICH ARE REFLECTIVE ITA NO. 57/JU/2010 M/S KRISHI YANTRALAYA 3 OF THE FAIR MARKET VALUE THE REGISTERED VALUERS REP ORT FURNISHED BY THE APPELLANT DID NOT HAVE ANY CONSEQUENCE THEREFORE THE ADOPTION OF DLC RATES BY THE AO FOR THE PURPOSE OF CALCULATION OF CAPITAL GAINS IS HELD TO BE JUSTIFIED. STILL AGGRIEVED THE ASSESSEE IS IN APPEAL BEFORE THE ITAT. 4. BEFORE US THE LEARNED COUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT THE VALUE ADOPTED BY THE STAMP VALUATION OFFIC ER EXCEED THE FAIR MARKET VALUE THE MATTER OUGHT TO HAVE BEEN REFERRE D TO THE VALUATION OFFICER IN VIEW OF SECTION 50C(2) OF THE ACT. HE CO NTENDED THAT THE CIT(A) ERRED IN CONFIRMING THE ACTION OF THE AO. 5. ON THE OTHER HAND THE LEARNED DR HAS RELIED ON THE ORDERS OF THE AO AS WELL AS CIT(A). 6. WE HAVE HEARD THE LEARNED REPRESENTATIVES OF THE PARTIES AND PERUSED THE RECORD. THE ISSUE INVOLVED IN THIS APPE AL IS WHETHER THE AO IS RIGHT IN ADOPTING DLC RATE FOR THE PURPOSE OF CALCULATING CAPITAL GAINS WITHOUT REFERRING THE MATTER TO THE VALUATION OFFICER ?. THE AO WAS OF THE VIEW THAT EVEN IN THE COMPARABLE CASES DONE BY THE REGISTRATION AUTHORITY AT ENHANCED VALUE OF THE DLC THEREFORE ADOPTING DLC RATE FOR THE PURPOSE OF CALCULATION OF CAPITAL GAINS IS PROPER. AS PER THE ASSESSEE WHEN THE VALUE ADOPTED BY THE STAMP VALUATION OFFICER EXCEEDED THE FAIR MARKET VALUE T HE MATTER OUGHT TO HAVE BEEN REFERRED TO THE VALUATION OFFICER IN VIEW OF SECTION 50C(2). IN THIS CONNECTION WE REPRODUCE THE PROVISIONS OF SECTION 50C(2) WHICH ARE AS UNDER:- WITHOUT PREJUDICE TO THE PROVISIONS OF SUB-SECTION (1) WHERE ( A ) THE ASSESSEE CLAIMS BEFORE ANY ASSESSING OFFICER THAT THE VALUE ADOPTED OR ASSESSED 54 [OR ASSESSABLE] BY THE STAMP VALUATION AUTHORITY UN DER SUB-SECTION (1) EXCEEDS THE FAIR MARKET VALUE OF THE PROPERTY A S ON THE DATE OF TRANSFER; ( B ) THE VALUE SO ADOPTED OR ASSESSED 54 [OR ASSESSABLE] BY THE STAMP VALUATION AUTHORITY UNDER SUB-SECTION (1) HAS NOT BEEN DISPUT ED IN ANY APPEAL OR REVISION OR NO REFERENCE HAS BEEN MADE BEFORE ANY OTHER AUTH ORITY COURT OR THE HIGH COURT ITA NO. 57/JU/2010 M/S KRISHI YANTRALAYA 4 THE ASSESSING OFFICER MAY REFER THE VALUATION OF TH E CAPITAL ASSET TO A VALUATION OFFICER AND WHERE ANY SUCH REFERENCE IS MADE THE P ROVISIONS OF SUB-SECTIONS (2) (3) (4) (5) AND (6) OF SECTION 16A CLAUSE ( I ) OF SUB-SECTION (1) AND SUB-SECTIONS (6) AND (7) OF SECTION 23A SUB-SECTION (5) OF SECT ION 24 SECTION 34AA SECTION 35 AND SECTION 37 OF THE WEALTH-TAX ACT 1957 (27 OF 1 957) SHALL WITH NECESSARY MODIFICA-TIONS APPLY IN RELATION TO SUCH REFERENCE AS THEY APPLY IN RELATION TO A REFERENCE MADE BY THE ASSESSING OFFICER UNDER SUB-S ECTION (1) OF SECTION 16A OF THAT ACT. 7. ON PERUSAL OF SECTION 50C(2) IT IS CLEAR THAT T HE VALUE ADOPTED BY THE STAMP VALUATION AUTHORITY EXCEEDS THE FAIR M ARKET VALUE OF THE PROPERTY AS ON THE DATE OF TRANSFER THE AO MAY REF ER THE VALUATION OF THE CAPITAL ASSET TO A VALUATION OFFICER. THEREFORE WE FIND FORCE IN THE SUBMISSION OF THE ASSESSEE THAT WHEN THE VALUE ADOP TED BY THE STAMP VALUATION OFFICER EXCEEDED THE FAIR MARKET VALUE T HE MATTER OUGHT TO HAVE BEEN REFERRED TO THE VALUATION OFFICER IN VIEW OF SECTION 50C(2). IN VIEW OF THE ABOVE WE REMIT THE MATTER BACK TO T HE FILE OF THE AO WITH A DIRECTION TO REFER THE MATTER TO THE VALUATI ON OFFICER AND DECIDE THE ISSUE IN ACCORDANCE WITH LAW AFTER PROVIDING RE ASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 8. IN THE RESULT THE APPEAL OF THE ASSESSEE IS TRE ATED AS ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED ON 22 ND MARCH 2011. SD/- SD/- (S.V. MEHROTRA) (V. DU RGA RAO) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI DATED: 22 ND MARCH 2011. ITA NO. 57/JU/2010 M/S KRISHI YANTRALAYA 5 COPY TO:- 1) THE APPELLANT. 2) THE RESPONDENT. 3) THE CIT (A) CONCERNED. 4) THE CIT CONCERNED. 5) THE DEPARTMENTAL REPRESENTATIVE I.T.A.T. JOD HPUR . BY ORDER //TRUE COPY// ASST. REGISTRAR I.T.A.T. MUMBAI. KV S.NO. DESCRIPTION DATE INTLS 1. DRAFT DICTATED ON 01/03/11 SR.P.S./P.S 2. DRAFT PLACED BEFORE AUTHOR 02/03/11 SR.P.S/PS 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER JM/AM 5 APPROVED DRAFT COMES TO THE SR.P.S./PS SR.P.S./P.S 6. KEPT FOR PRONOUNCEMENT ON SR. P.S./P.S. 7. FILE SENT TO THE BENCH CLERK SR.P.S./P.S 8 DATE ON WHICH FILE GOES TO THE HEAD CLERK 9 DATE OF DISPATCH OF ORDER