VIVEK AGNIHOTRI,MUMBAI vs. ITO 16 (1)(5), MUMBAI

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ITA 2743/MUM/2019Status: DisposedITAT Mumbai18 March 2021AY 2012-139 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal acknowledged the assessee's contentions regarding litigation and the forced distress sale, which were supported by court filings. The Tribunal also noted that a registered valuation report, filed as additional evidence before the CIT(A), was not accepted. Considering that the assessee sought an opportunity to substantiate the claim with evidence before the income tax authorities, and to meet the ends of justice, the Tribunal decided to provide one more opportunity to the assessee. Consequently, the order of the CIT(A) was set aside, and the disputed issue was restored to the file of the AO for reconsideration. The AO was directed to consider the assessee's submissions and evidence, providing the assessee with an adequate opportunity of hearing and cooperation in submitting information. The ground of appeal was allowed for statistical purposes.

What were the facts?

The assessee, Vivek Agnihotri, engaged in film production, sold a property in Bhopal for Rs. 2,07,00,000/- in Assessment Year 2012-13. The Assessing Officer (AO) received information that the stamp duty valuation by Sub-Registrar, Bhopal, was Rs. 2,68,05,200/-. Believing income had escaped assessment, the AO issued a notice u/s 148. The AO referred the property valuation to the Department Valuation Officer (DVO) u/s 55A(a). The DVO determined the fair market value at Rs. 2,39,73,600/-. The AO adopted this value and made an addition of Rs. 26,73,600/- to the capital gains, completing the assessment u/s 147 r.w.s 143(3). The Commissioner of Income Tax (Appeals) upheld the AO's action. The assessee appealed to the ITAT.

What were the issues?

1. Whether the Commissioner of Income Tax (Appeals) was justified in upholding the addition of long-term capital gains of Rs. 26,73,600/- on the sale of property at Bhopal, by applying the provisions of Section 50C of the Income Tax Act, 1961, and adopting the market value determined by the Department Valuation Officer (DVO). Assessee's contentions: The assessee argued that the DVO's valuation is not applicable because the property was in litigation, with cross-suits filed before the District Court, Bhopal. The assessee's father expired in 2008, and his will was disputed. The property was occupied by the assessee's brother-in-law who refused to vacate, forcing a distress sale. The assessee also contended that the registered valuer's report dated 12-02-2018, filed before the CIT(A), which considered litigation and distress sale, was not accepted. The assessee sought an opportunity to substantiate the claim with evidence. Revenue's contentions: The Revenue supported the order of the CIT(A) and emphasized that the value adopted by the AO as per the DVO's valuation report is correct and final.

Which sections of the Income-tax Act were involved?

Section 50C,Section 55A,Section 143(3),Section 147,Section 148,Section 139(1),Section 142(1),Section 16A(4)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “SMC” BENCH, MUMBAI

Before: SHRI M BALAGANESH & SHRI PAVAN KUMAR GADALE

For Appellant: Shri Chetan Karia, AR
Hearing: 17.02.2021Pronounced: 18.03.2021

आदेश क� ��त�ल�प अ�े�षत/Copy of the Order forwarded to : 1. अपीलाथ� / The Appellant ��यथ� / The Respondent. 2. 3. संबं�धत आयकर आयु�त / The CIT(A) 4. आयकर आयु�त(अपील) / Concerned CIT �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, अहमदाबाद / DR, ITAT, Mumbai 5. 6. गाड� फाईल / Guard file. आदेशानुसार/ BY ORDER, स�या�पत ��त //True Copy// 1. ( Asst. Registrar) ITAT, Mumbai

Initial Date 1. Draft dictated on 09.03.21 PS 2. Draft placed before author 10.03.21 PS

3.

Draft proposed & placed before PS the second member 4. Draft discussed/approved by PS Second Member. 5. Approved Draft comes to the PS Sr.PS/PS 6. Kept for pronouncement on 7. File sent to the Bench Clerk 8. Date on which file goes to the AR 9. Date on which file goes to the Head Clerk. 10. Date of dispatch of Order. 11. Dictation Pad is enclosed 2. Other Member… on whi

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