DCIT, CC-1(3), Kolkata, Kolkata v. M/S. Punam Chand Mittal, Kolkata

ITSSA 20/KOL/2015 | 2011-2012
Pronouncement Date: 19-10-2016

Appeal Details

RSA Number 2023516 RSA 2015
Assessee PAN AADFP7834L
Bench Kolkata
Appeal Number ITSSA 20/KOL/2015
Duration Of Justice 1 year(s) 8 month(s) 30 day(s)
Appellant DCIT, CC-1(3), Kolkata, Kolkata
Respondent M/S. Punam Chand Mittal, Kolkata
Appeal Type Income Tax (Search & Seizure) Appeal
Pronouncement Date 19-10-2016
Appeal Filed By Department
Bench Allotted B
Tribunal Order Date 19-10-2016
Date Of Final Hearing 04-10-2016
Next Hearing Date 04-10-2016
Assessment Year 2011-2012
Appeal Filed On 20-01-2015
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL B BENC H KOLKATA BEFORE SHRI M. BALAGANESH AM & SHRI S.S.VISWANETHR A RAVI JM IT(SS)A NO.20/KOL/2015 ( / ASSESSMENT YEAR :2011-2012) DCIT-CC-1(3) KOLKATA VS. M/S PUNAM CHAND MITTAL 10C MIDDLETON ROW DABRIWALA HOUSE 4 TH FLOOR KOLKATA-700071 ./ ./PAN/GIR NO. : AADFP 7834 L ( /APPELLANT ) .. ( / RESPONDENT ) /REVENUE BY : SHRI G.MALLIKARJUNA CIT DR /ASSESSEE BY : SHRI D.S.DAMLE FCA / DATE OF HEARING : 04/10/2016 /DATE OF PRONOUNCEMENT 19/10/2016 / O R D E R PER M.BALAGANESH AM THIS APPEAL OF THE ASSESSEE ARISES OUT OF THE ORDE R OF LEARNED CIT(A) CENTRAL-1 KOLKATA IN APPEAL NO.133/CIT(A) C-I/CC-V/13-14 DATED 29.8.14 PASSED AGAINST THE ASSESSMENT FRAMED U/S.143(3) OF THE INCOME TAX ACT 1961 (HEREINAFTER REFERRED TO AS TH E ACT). 2. AT THE OUTSET THERE WAS A DELAY OF 67 DAYS IN F ILING THIS APPEAL BY THE REVENUE BEFORE US. THE LD DR PRAYED FOR CONDONATIO N OF THE DELAY AND STATED THAT THE LD AO HAD FILED AN AFFIDAVIT TO THI S EFFECT. THE LD AR SEVERELY OBJECTED TO THE CONDONATION OF DELAY AND S TATED THAT THE REASONING GIVEN BY THE REVENUE THAT THE LD AO WAS A WAITING FROM 14.11.14 TO 28.12.14 FOR THE VALUATION REPORT FROM THE DIST RICT VALUATION OFFICER (DVO). HE ARGUED THAT THE SAME DOES NOT CONSTITUTE REASONABLE CAUSE FOR THE DELAY IN FILING THE APPEAL. HE STATED THAT THE ISSUE INVOLVED WAS WITH REGARD TO ADOPTION OF VALUE AS PER SECTION 50C OF T HE ACT. HE BRIEFLY EXPLAINED THE FACTS OF THE CASE THAT THE ASSESSEE H AD REPORTED THE CONSIDERATION AT RS 18 LACS. THE ASSESSEE HELD THE 6 ACRES OF LAND AS CAPITAL ASSET WHICH WAS CONVERTED INTO STOCK IN TRA DE ON 1.1.2011 AND IT(SS)A NO.20/15 2 IMMEDIATELY AFTER CONVERSION SOLD THE SAID LANDS O N 11.1.2011 TO ITS SISTER CONCERN M/S PCM TEA PROCESSING PVT LTD. THE LD AO RESORTED TO ADOPTION OF VALUE DETERMINED U/S 50C OF THE ACT AS THE FULL VALUE OF CONSIDERATION. THE ASSESSEE OBJECTED TO THE SAME ST ATING THAT THE VALUE DETERMINED BY THE STAMP VALUATION AUTHORITY DOES NO T CONSTITUTE THE FAIR MARKET VALUE OF THE LAND. THE REVENUE ADOPTED THE V ALUE DETERMINED BY THE STAMP VALUATION AUTHORITY AT RS.1 06 88 658/- A ND SUBSTITUTED THE CAPITAL GAINS ACCORDINGLY AS AGAINST THE REPORTED C ONSIDERATION OF RS.18 00 000/-. THE LD CITA DIRECTED THE LD AO TO REFER THE VALUATION OF THE PROPERTY TO DISTRICT VALUATION OFFICER IN TERMS OF SECTION 50C(2) OF THE ACT AND BY PLACING RELIANCE ON THE DECISION OF THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF SUNIL KUMAR AGARWAL VS CI T REPORTED IN (2015) 372 ITR 83 (CAL) AND DECIDE THE ISSUE ACCORDINGLY . THE LD AR STATED THAT THE VALUATION REPORT OF DVO STATED THE CONSIDE RATION VALUE TO BE RS 21 LACS AS AGAINST REPORTED AMOUNT OF RS 18 LACS BY THE ASSESSEE. THIS SITUATION WAS TOTALLY FAVOURABLE TO THE ASSESSEE AN D HENCE THE LD AO AFTER OBTAINING THE VALUATION REPORT DECIDED TO PREFER AN APPEAL BEFORE THIS TRIBUNAL AS THE DVO VALUATION HAD CONSIDERABLY BROU GHT DOWN THE CONSIDERATION FIGURE FROM RS. 1.06 CRORES TO RS. 21 LACS. HE ARGUED THAT THE REASONING GIVEN BY THE REVENUE ONLY TANTAMOUNTS TO SHOPPING OF JUDICIAL FORUMS AND DOES NOT CONSTITUTE REASONABLE CAUSE FOR THE DELAY. HE ARGUED THAT EVEN THOUGH THE LD CITA HAD DIRECTED THE LD AO TO REFER THE VALUATION OF THE ASSET TO LD DVO THERE WAS NO NECESSITY FOR THE LD AO TO WAIT FOR THE SAID REPORT FROM LD DVO FOR PREFERR ING AN APPEAL BEFORE THE TRIBUNAL. IF THE LD AO IS AGGRIEVED WITH THE ORDER OF THE LD CITA HE SHOULD HAVE PREFERRED APPEAL BEFORE THE TRIBUNAL AND THERE AFTER OBTAINED THE REPORT OF THE LD DVO AND GIVE EFFECT TO THE ORDER O F THE LD CITA. ACCORDINGLY HE ARGUED THAT THE EXPLANATION FOR THE DELAY BETWEEN 14.11.2014 TO 28.12.2014 DOES NOT STAND PROPERLY EX PLAINED IN THE FACTS AND CIRCUMSTANCES OF THE CASE. HE ALSO QUOTED AN EXAMPLE IN THIS REGARD :- IT(SS)A NO.20/15 3 SUPPOSE AN ORDER U/S 263 OF THE ACT WAS PASSED BY T HE LD CIT AND THE ASSESSEE DOES NOT PREFER APPEAL AGAINST THAT ORDER BEFORE THE TRIBUNAL WITHIN TIME. HE WAITS FOR THE GIVING EFFECT ORDER TO BE GIVEN BY THE LD AO PURSUANT TO LD CITS ORDER U/S 263 OF THE ACT. OBS ERVING LATER THAT THE GIVING EFFECT ORDER IS AGAINST THE ASSESSEE HE /SH E PREFERS TO FILE AN APPEAL BEFORE THE TRIBUNAL WITH A DELAY CONDONATION PETITION ON THE GROUND THAT THE ASSESSEE WAS WAITING FOR THE GIVING EFFECT ORDER TO BE COMPLETED. CAN THIS BE CONSTRUED AS PROPER EXPLANATION OF DELA Y ON THE PART OF THE ASSESSEE ? THE ANSWER WOULD BE EMPHATIC NO. THE SITUATION IN THE INSTANT CASE ALSO SQUARELY FAL LS UNDER THE AFORESAID EXAMPLE. ACCORDINGLY HE OBJECTED TO THE CONDONATI ON OF DELAY AND PRAYED FOR DISMISSAL OF THE APPEAL OF THE REVENUE A S NOT MAINTAINABLE ON THE GROUND OF DELAY. HE ARGUED THAT EVEN ON MERITS THE REVENUE DOES NOT HAVE ANY CASE AS THE LD CITA HAD ONLY DIRECTED AS P ER THE LAW AND BY FOLLOWING THE JURISDICTIONAL HIGH COURT DECISION. 3. IN RESPONSE TO THIS THE LD DR STATED THAT THE LD AO HAD TO FOLLOW THE DIRECTIONS OF THE LD CITA WHO HAD DIRECTED THE LD A O TO REFER THE CASE TO THE LD DVO IN TERMS OF SECTION 50(C ) (2) OF THE AC T AND DECIDE THE ISSUE ACCORDINGLY AS PER LAW. HENCE THE LD AO HAD TO WAI T FOR THE VALUATION REPORT BEFORE GIVING EFFECT TO THE APPELLATE ORDER AND ONLY THEREAFTER COULD PROCEED IN PREFERRING THE APPEAL BEFORE THE TRIBUNA L. HE ARGUED THAT ONCE THE VALUATION REPORT WAS OBTAINED THEREAFTER THE L D AO WAS PRE-OCCUPIED WITH TIME BARRING MATTERS AND AFTER FINISHING THE T IME BARRING MATTERS WAS AWAITING FOR THE APPROVALS OF THE HIGHER AUTHORITIE S AS PER THE PROCEDURE LAID DOWN BY THE CENTRAL BOARD OF DIRECT TAXES. AC CORDINGLY HE PRAYED FOR CONDONATION OF THE DELAY. ON MERITS OF THE ADDITI ON HE ARGUED THAT ARGUED THAT THE PROVISIONS OF SECTION 50C (2) OF TH E ACT USES THE EXPRESSION MAY REFER TO VALUATION OF THE ASSET TO THE VALUATION OFFICER AND IT IS NOT MANDATORY ON THE PART OF THE LD AO TO REF ER TO DVO. HENCE HE OBJECTED TO THE DIRECTIONS OF THE LD CITA TO THE LD AO TO DETERMINE THE CONSIDERATION VALUE BASED ON VALUE DETERMINED BY TH E DVO. IT(SS)A NO.20/15 4 3. WE HAVE HEARD THE RIVAL SUBMISSIONS. WE FIND TH AT THE REVENUE HAD FILED THE AFFIDAVIT SEEKING FOR CONDONATION OF DELA Y IN FILING THE APPEAL AS BELOW:- AFFIDAVIT I ARUP CHATTRJEE SON OF LATE ANIMESH CHATTERJEE A GED ABOUT 47 YEARS WORKING AS DEPUTY COMMISSIONER OF INCOME TAX CENTRAL CIRCLE-1(3) KOLKATA RESIDING AT 38/5/2 MAHATMA GAN DHI ROAD KOLKATA-700082 DO HEREBY SOLEMNLY AFFIRM AND STATED REGARDING THE DATE OF FILING OF APPEAL IN THE CASE OF M/S PUNAM C HAND MITTAL EXPIRED ON 14.11.2014. REASONS RESPONSIBLE FOR DELA Y IN FILING THE APPEAL ARE NARRATED BELOW :- D A T E R E A S O N 14-11-2014 TO 28- 12-2014 VALUATION REPORT IS AWAITED FROM VALUATION OFFICER 29-12-2014 RECEIVED VALUATION REPORT 30-12-2014 ORDER PASSED AFTER GIVING APPEAL EFFECT 31-12-2014 TO 02- 01-2015 BUSY IN TIME-BARRING MATTERS 03-01-2015 TO 04- 01-2015 SATURDAY & SUNDAY 05-01-2015 TO 08- 01-2015 BUSY IN TIME BARRING MATTERS 09-01-2015 APPEAL SCRUTINY REPORT SENT TO CIT(C)-1 KOL THROUGH PROPER CHANNEL 10-01-2015 & 11-01- 2015 SATURDAY & SUNDAY 12-01-2015 TO 14- 01-2015 FILE IS WITH CIT(C)-1 KOLKATA 15-01-2015 FILE RECEIVED FROM CIT(C)-1 KOLKATA SUGG ESTING 2 ND APPEAL 16-01-2015 PREPARED PAPERS FOR FILING SECOND APPEAL 17-01-2015 & 18-01- 2015 STATURDAY & SUNDAY 19-01-2015 AFFIDAVIT BEFORE NOTARY IS MADE IN VIEW OF THE ABOVE YOUR ARE KINDLY REQUESTED TO C ONDONE THE DELAY AND ALLOW ME TO FILE APPEAL APPELLANT DCIT CC-1(3) KOLKATA I ARUP CHATTRJEE DCIT CC-1(3) KOLKATA DO HEREBY VERIFY THAT THE FACT REFERRED TO ABOVE ARE TRUE AND CORREC T TO THE BEST OF MY KNOWLEDGE AND BELIEF. DATED 19 TH JANUARY 2015 APPELLANT DCIT CC-1(3) KOLKATA IT(SS)A NO.20/15 5 3.1. THE FACTS STATED HEREINABOVE IN THE SUBMISSION S OF THE LD AR REMAIN UNDISPUTED AND HENCE THE SAME ARE NOT REITERATED HE REIN FOR THE SAKE OF BREVITY. WE FIND THAT THE LD AR HAD ADVANCED ARGUME NTS VEHEMENTLY FOR NOT CONDONING THE DELAY IN FILING THE APPEAL OF THE REVENUE BY 67 DAYS. HOWEVER IN THE INTEREST OF JUSTICE WE DECIDE TO C ONDONE THE DELAY OF 67 DAYS IN FILING THE APPEAL BY THE REVENUE AND ADMIT THE APPEAL FOR ADJUDICATION. 3.2. ON MERITS WE HOLD THAT THE LD CITA HAD RIGHTL Y DIRECTED THE LD AO TO REFER THE MATTER TO LD DVO IN TERMS OF SECTION 50C( 2) OF THE ACT AS ASSESSEE HAD ADMITTEDLY OBJECTED TO THE VALUE DETER MINED BY THE STAMP VALUATION AUTHORITY U/S 50C OF THE ACT IN THE ASSES SMENT PROCEEDINGS ITSELF. IT IS FOUND THAT ULTIMATELY THE LD DVO HAD ADOPTED THE CONSIDERATION FIGURE TO BE APPROXIMATELY RS 21 LACS AS AGAINST RS 18 LACS REPORTED BY THE ASSESSEE. WE FIND THAT THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF SUNIL KUMAR AGARWAL VS CIT REPORTED IN (201 5) 372 ITR 83 (CAL) HAD HELD THAT THE REFERENCE TO LD DVO IS A BENEFICI AL PROVISION AND HENCE THE SAME COULD NOT BE TAKEN AWAY BY THE LD AO FROM THE PURVIEW OF THE ASSESSEE AND THE REFERENCE TO LD DVO WAS REQUIRED TO AVOID MISCARRIAGE OF JUSTICE. IT WAS ALSO HELD THAT THE LEGISLATURE H AD TAKEN CARE TO PROVE ADEQUATE MACHINERY TO GIVE A FAIR TREATMENT TO THE ASSESSEE THERE IS NO REASON WHY THE SAME SHOULD NOT BE USED AND THE BENE FIT THEREOF SHOULD BE REFUSED. HENCE WE HOLD THAT THE APPEAL OF TH E REVENUE FAILS ON MERITS OF THE CASE. ACCORDINGLY THE GROUNDS RAISED BY THE REVENUE ARE DISMISSED. 4. IN THE RESULT THE APPEAL OF THE REVENUE IS DISM ISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 19/10/ 2016. SD/ - (S.S.VISWANETHRA RAVI) SD/ - (M.BALAGANESH) / JUDICIAL MEMBER / ACCOUNTANT MEMBER /KOLKATA ; $% DATED 19/10/2016 & ()*/PRAKASH MISHRA . / PS IT(SS)A NO.20/15 6 / COPY OF THE ORDER FORWARDED TO : / BY ORDER / ( ASSTT. REGISTRAR) & ' / ITAT 1. / THE APPELLANT -DCIT-CC-1(3) KOLKATA 2. / THE RESPONDENT-M/S PUNAM CHAND MITTAL 3. 4 ( ) / THE CIT(A) KOLKATA. 4. 4 / CIT 5. 567 8 8 / DR ITAT KOLKATA 6. 79 / GUARD FILE. 5 //TRUE COPY//