Loading judgment…
No AI summary yet for this case.
Income Tax Appellate Tribunal, “C”, BENCH KOLKATA
Before: SHRI A.T. VARKEY, JM &DR. A.L.SAINI, AM
आदेश / O R D E R Per Dr. A. L. Saini, AM:
The captioned appeal filed by the assessee, pertaining to assessment year 2012-13, is directed against the order passed by the Commissioner of Income Tax (Appeal)-15, Kolkata, in appeal no. 53/CIT(A)-15/15-16/Wd-50(3)/Kol, which in turn arises out of an assessment order passed by the Assessing Officer u/s 143(3) of the Income Tax Act, 1961 (in short the ‘Act’) dated 23/03/2015.
2 Swami Satyananda ITA No.1614/Kol/2018 Assessment Year:2012-13 2.The appeal filed by the assessee for Assessment Year 2012-13, is barred by limitation by 73 days. The assessee has moved a petition requesting the Bench to condone the delay.Learned Counsel explained the reasons that assessee lives in hilly area far from Kolkata, therefore there was a communication gap between assessee and his advocate therefore, the delay of 73 days occurred. We have heard both the parties on this preliminary issue and having regard to the reasons given in the petition, we condone the delay and admit the appeal for hearing.
Although in this appeal, the assessee has raised a multiple grounds of appeal but at the time of hearing the solitary grievance of the assessee has been confined to the issue of determination of fair market value of immovable property ( for the purpose of computation of long term capital gain) as on 01.04.1981 at Rs. 5,82,083/- by the District Valuation Officer, Income Tax Department as against the fair market value at Rs. 18,51,000/- determined by the qualified registered valuer of the assessee.
Brief facts qua the issue are the assessee filed his return of income for the assessment year 2012-13 on 31-08-2012 declaring total income of Rs 9,79,170/-. The return of income was processed u/s 143(1) of the Act on 23/03/2013 on a total income of Rs 9,79,170/-. Later on, assessee`s case was selected for scrutiny under section 143(2) of the Act. The assessee is a Senior Citizen residing in Uttarkashi and has made financial transactions in connection with the transfer of immovable property at situated Salt Lake, Kolkata.An information was received from DDIT (Inv.) Unit-11, Dehradun that the assessee has entered into high value financial transaction to the extent of Rs.1,70,00,000/- which he received through sell out of his immovable property situated at CF-322,Sector-I, Salt Lake,Kolkata-700064. Out of sale consideration worth Rs.1,70,00,000/-, the assessee purchased TDRs and a part sale consideration was invested in Capital Gain deposit Account.
3 Swami Satyananda ITA No.1614/Kol/2018 Assessment Year:2012-13 The Distt. Valuation officer vide his report dated 17-02-2015 furnished the valuation report u/s 55A of the I.T.Act. The Distt. Valuation officer determined the Fair Market Value of the immovable property under consideration at Rs.5,82,083/- as on 01-04-1981.
On the other hand, the assessee vide his return of income dated 31-08-2012 claimed the Fair Market Value of his property at Rs.18,51,000/- as per his registered valuer of income tax, vide report dated 21-06-2011.Whereas,the valuation of DVO was at Rs.5,82,083/-as stated above. During the scrutiny proceedings, the assessee prayed the AO that Fair Market Value of his property at Rs.18,51,000/- should be adopted for computation of capital gain. However, the AO rejected the contention of the assessee and held that since the reference was made u/s 55A of the Act and whereupon report of DVO is binding upon the AO in terms of same reference made u/s 55A read with Section 16A, read with section 16A(5) and 16A(6) of the W.T.Act 1957, there was no other alternative but to adopt the valuation made by D.V.O. Therefore, AO adopted the fair market value of the property as on 01.04.1981 at Rs.5,82,083/- as determined by DVO for the purpose of computation of long term capital gain.
Aggrieved by the stand so taken by the Assessing Officer the assessee carried the matter in appeal before the ld. CIT(A) who has confirmed the action of the assessing officer.
Aggrieved by the order of the ld. CIT(A) the assessee is in appeal before us.
We have heard both the parties and carefully gone through the submission put forth on behalf of the assessee along with the documents furnished and the case laws relied upon, and perused the fact of the case including the findings of the ld CIT(A) and other material available on record. Before us, the Ld. DR for the
4 Swami Satyananda ITA No.1614/Kol/2018 Assessment Year:2012-13 Revenue has primarily reiterated the stand taken by the Assessing Officer, which we have already noted in our earlier para and is not being repeated for the sake of brevity. On the other hand, ld Counsel relied on the submissions made before the authorities below.The issue which needs to be addressed by us is that for the purpose of computation of long term capital gain, the value of immovable property determined by the District Valuation Officer as on 01.04.1981 at Rs. 5,82,083/- should be adopted or valuation done by Registered Valuer of the assessee at Rs. 18,51,000/- should be adopted? First of all, let us go through the provisions of section 55A of the Income tax Act 1961, which reads as follows:
“Section 55A:Reference to Valuation Officer. 55A. With a view to ascertaining the fair market value of a capital asset for the purposes of this Chapter, the [Assessing] Officer may refer the valuation of capital asset to a Valuation Officer— (a) in a case where the value of the asset as claimed by the assessee is in accordance with the estimate made by a registered valuer, if the [Assessing] officer is of opinion that the value so claimed [is at variance with its fair market value]; (b) in any other case, if the [Assessing] Officer is of opinion— (i) that the fair market value of the asset exceeds the value of the asset as claimed by the assessee by more than such percentage of the value of the asset as so claimed or by more than such amount as may be prescribed in this behalf ; or (ii) that having regard to the nature of the asset and other relevant circumstances, it is necessary so to do, and where any such reference is made, the provisions of sub-sections (2), (3), (4), (5) and (6) of section 16A, clauses (ha) and (i) of sub-section (1) and sub-sections (3A) and (4) of section 23, sub-section (5) of section 24, section 34AA, section 35 and section 37 of the Wealth-tax Act, 1957 (27 of 1957), shall with the necessary modifications, apply in relation to such reference as they apply in relation to a reference made by the [Assessing] Officer under sub-section (1) of section 16A of that Act. Explanation.—In this section, "Valuation Officer" has the same meaning, as in clause (r) of section 2 of the Wealth-tax Act, 1957 (27 of 1957).]
5 Swami Satyananda ITA No.1614/Kol/2018 Assessment Year:2012-13 7. We note that section 55A(a) was amended by the Finance Act 2012, with effect from 01.07.2012. Prior to 01.07.2012, section 55A(a) reads as follows:
“Section 55A:Reference to Valuation Officer. 55A. With a view to ascertaining the fair market value of a capital asset for the purposes of this Chapter, the [Assessing] Officer may refer the valuation of capital asset to a Valuation Officer— (a) in a case where the value of the asset as claimed by the assessee is in accordance with the estimate made by a registered valuer, if the [Assessing] Officer is of opinion that the value so claimed [is less than its fair market value];
We note that amended provisions of section 55A(a) is applicable from 01.07.2012, that is, (previous year 01.07.2012 to 31.03.2013) for assessment year 2013-14 onwards. Whereas the assessee sold the property on 21.07.2011, therefore amended provisions of section 55A(a) does not apply to the assessee under consideration. In assessee`s case the assessment year is A.Y. 2012-13 whereas amended provisions of section 55A(a) of the Act are applicable from A.Y. 2013-14. Hence, pre-amended section 55A(a) is applicable to the assessee wherein the terminology used is “is less than its fair market value” . We note that assessee`s qualified Registered Valuer of Income Tax had valued the property at fair market value on 01.04.1981 at Rs. 18,51,000/- which is not less than the fair market value done by the District Valuation Officer of Income Tax Department at Rs.5,82,083/-. Based on the position in law as explained above, we direct the assessing officer to take the fair market value of the property as on 01.04.1981 at Rs. 18,51,000/- for the purpose of computation of long term capital gain.
8.Before parting, it is noted that the order is being pronounced after 90 days of hearing. However, taking note of the extraordinary situation in the light of the Covid-19 pandemic and lockdown, the period of lockdown days need to be excluded. For coming to such a conclusion, we rely upon the decision of the Co-
6 Swami Satyananda ITA No.1614/Kol/2018 Assessment Year:2012-13 ordinate Bench of the Mumbai Tribunal in the case of DCIT vs. JCB Limited in ITA No. 6264/Mum/2018 and ITA No. 6103/Mum/2018 for A.Y. 2013-14 order dated 14.05.2020.
In the result, the appeal of the assessee is allowed.
Order pronounced in the Court on 17.06.2020
Sd/- Sd/- (A.T. VARKEY) (A.L.SAINI) �या�यकसद�य / JUDICIAL MEMBER लेखासद�य / ACCOUNTANT MEMBER �दनांक/ Date: 17/06/2020 (SB, Sr.PS)
Copy of the order forwarded to: 1. Swami Satyananda 2. ITO, Ward-50(3), Kolkata 3. C.I.T(A)- 4. C.I.T.- Kolkata. 5. CIT(DR), KolkataBenches, Kolkata. 6. Guard File.