C I T vs. RAVINDER KAUR

This order shall dispose of ITA Nos.240 and 241 of 2009 as according to the learned counsel for the parties, the facts and the issue involved in both the appeals are identical. However, the facts are being extracted from ITA No.240 of 2009. ITA No.240 of 2009 relates to the assessment year 1994-95 whereas ITA No.241 of 2009 relates to the assessment year 1995-96. 2. ITA No.240 of 2009 has been preferred by the revenue under Section 260A of the Income Tax Act, 1961 (in short, “the Act”) against the orders dated 16.6.2004 in ITA No.6/Chandi/2003 and 26.6.2007 in M.A.No.62/Chandi/2006, Annexures A.4 and A.5 respectively, passed by the Income Tax Appellate Tribunal, Chandigarh Bench (for brevity, “the Tribunal”), for the assessment year 1994-95, claiming following substantial GURBAX SINGH 2014.10.14 10:33 integrity of this document High Court Chandigarh question of law:- “Whether on the facts and the circumstances of the case and in law, the order of the ITAT is perverse as it has failed to appreciate that the provision of Section 142A has been retrospectively amended by the Finance Act 2004 w.e.f 15.11.1972?

A few facts relevant for the decision of the controversy as narrated in ITA No.240 of 2009 may be noticed. The assessee-respondent alongwith co-owners had been allotted plot bearing No.SCO No.52-53, Sector 9, Chandigarh by the Estate Officer, Chandigarh. A sum of ` 14,13,860/- was stated to have been invested towards the construction of the property in two assessment years i.e 1994-95 and 1995-96. The Assessing officer referred the matter to the Valuation Officer in order to ascertain the actual cost of construction, who determined the same at ` 23,73,012/-. For the period relevant to the assessment year 1994-95, the cost of construction was determined at ` 18,04,216/- as against declared at ` 10,75,348/-, thereby giving a difference in the cost of construction at ` 7,29,436/-. The assessee's share out of this difference was determined at ` 1,82,359/- and was added to her taxable income vide order dated 25.2.2002, Annexure A.

Learned counsel for the revenue submitted that the Tribunal had erred in rejecting the appeals of the revenue. According to the learned counsel, in view of Section 142A of the Act, introduced by Finance Act, 2004 effective from 15.11.1972, the matter of valuation of property in question had been rightly referred to the Valuation Officer and there was a difference of ` 1,82,359/- on account of assessee's share being 25% for the assessment year 1994-95 and ` 58,825/- for the assessment year 1995-96. 5. Learned counsel for the assessee submitted that the Tribunal had relied upon the order in the case of Paramjit Singh, husband of the assessee while disposing of the appeals. It was urged that the assessee had 25% share in the property in dispute and once the department had accepted 2014.10.14 10:33 integrity of this document High Court Chandigarh

It may be noticed that the assessee had 25% share in SCO No.52-53, Sector 9, Chandigarh. Her husband was also a co-sharer holding 25% share. The assessee had declared the value of the cost of construction at ` 14,13,860/- as against ` 23,73,012/- assessed by the Departmental Valuation Officer (DVO). The difference, thus, came to ` 9,59,152/- which on bifurcation between assessment years 1994-95 and 1995-96 came to ` 7,29,436/- and ` 2,20,176/- respectively. The 25% share of the assessee therein resulted in addition of ` 1,82,359/- for assessment year 1994-95 and ` 58,825/- for the assessment year 1995-96. It was not disputed by learned counsel for the revenue that the husband of the assessee, Shri Paramjit Singh also had 25% share in the said property and in his case, the Tribunal had adjudicated the issue in his favour and accepted the valuation shown by him and the order of the Tribunal was accepted by the revenue as no further appeal was filed against it. In such circumstances, it would not be appropriate to adopt two different valuations in respect of identical shares in the same property for the same period.

A Division Bench of this Court in Jaswant Rai's case (supra) noticed that where the property was jointly owned, the valuation in the case of one co-sharer should be followed in the case of other co-sharer unless different circumstances are demonstrated. Further, the Apex Court in Berger Paints India Limited's case (supra) while adjudicating identical issue held as under:- “12. In view of the judgments of this Court in Union of India 2014.10.14 10:33 integrity of this document High Court Chandigarh down by the High Court and has accepted it in the case of one assessee, then it is not open to the revenue to challenge its correctness in the case of other assessees, without just cause.”

In view of the above, the substantial question of law is answered accordingly. Consequently, finding no merit in the appeals, the same are dismissed. (Ajay Kumar Mittal) Judge August 21, 2014