M/S. RAJENDRA NATHANI (HUF),RAIPUR (CG) vs. ITO- 1(2), RAIPUR (CG)

IN THE INCOME TAX APPELLATE TRIBUNAL RAIPUR BENCH, RAIPUR BEFORE SHRI R. K. PANDA, ACCOUNTANT MEMBER AND MS. SUCHITRA KAMBLE, JUDICIAL MEMBER ITA No.1/RPR/2016 Assessment Year : 2010-11 Rajendra Nathani (HUF), ITO- 1(2), H-100, I-6, Rajiv Nagar, Raipur (CG). Shankar Nagar, Vs. Raipur (CG).

PAN : AADHN1997J (Appellant) (Respondent)

: Assessee by Shri Aman Bansal, CA : Shri Ajit Kr. Laskar, DR Department by Date of hearing : 13-08-2018 Date of pronouncement : 13-08-2018 O R D E R PER R. K. PANDA, AM : This appeal filed by the assessee is directed against the order dated 15.10.2015 of the ld. CIT(A)- 1, Raipur (CG) relating to assessment year 2010-11. 2. Facts of the case, in brief, are that the assessee is an individual and derives income from the house property as well as capital gain from sale of property. During the impugned assessment year, the assessee sold a property for Rs.15,00,000/- and paid taxes on capital gain as per Rules. However, the

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market value of the property was Rs.53,26,300/-. Since there was

understatement of capital gain, the case of the assessee was reopened and the

Assessing Officer in the order passed u/s 143(3)/147 determined the total

income at Rs.41,17,930/- wherein he made addition of Rs.38,26,300/- on

account of long term capital gain.

Officer on account of long term capital gain.

before the Tribunal by raising the following grounds :-

“1. On the facts and in the circumstances of the case, the Learned A.O. has erred on facts and in law in substituting the actual consideration of Rs.15,00,000/- with value adopted for stamp duty purposes at Rs.53,26,300/- in view of provisions of section 50C of the Income Tax Act, 1961 and Learned Commissioner of Income Tax (Appeals)-I [hereinafter referred to as CIT(A)] has erred in confirming the enhancement to the total income done by Learned A.O. without considering the provisions of Section 50C(2) of the Income Tax Act, 1961. 2. On the facts and in the circumstances of the case, the Learned CIT(A) has erred on facts and in law in confirming the assessment order passed u/s 143(3) when the proceedings had been initiated u/s 147. 3. On the facts and in the circumstances of the case, the Learned CIT(A) has erred on facts and in law in confirming the assessment proceedings initiated u/s 147 merely based on AIR Information without independent application of mind. 4. The Appellant craves leave to add, amend, alter vary and / or withdraw any or all the above grounds of Appeal.”

“1(A) On the fact and circumstances of the case the assessing officer and the CIT(A) erred in applying the provisions of section 50(c) on transfer of the leasehold rights of land and building.”

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that the ground being a legal one and since all material facts are already

available on record, therefore, this ground should be admitted.

additional ground.

ground raised by the assessee is a legal one and all material facts are already

available on record, the additional ground raised by the assessee is admitted.

Deed executed in favour of the assessee and submitted that the same clearly

mentions that the transfer is of leasehold rights for the remaining lease period

and not a transfer of land and building. Therefore, it being a transfer of

leasehold rights provisions of section 50C are not applicable in the present case.

Referring to the decision of the Hon’ble Bombay High Court in the case of CIT

vs. M/s. Greenfield Hotels & Estates Pvt. Ltd. vide ITA No.735 of 2014 order

dated 24.10.2016, he submitted that the Hon’ble High Court in the said decision

has held that section 50C is not applicable while computing capital gains on

transfer of leasehold rights in land and building. He accordingly submitted that

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the addition made by the Assessing Officer and upheld by the ld. CIT(A) is not

tenable and, therefore, the same should be deleted.

raised before the Assessing Officer and the ld. CIT(A), therefore, this matter

may be restored to the file of the Assessing Officer for adjudication of the issue

afresh.

perused the material available on record. The grievance of the assessee in the

impugned appeal is regarding the applicability of provisions of section 50C

while computing the capital gains on transfer of leasehold rights in land and

building. It is an admitted fact that the assessee has never raised the

applicability of provisions of section 50C while computing the capital gains on

transfer of leasehold rights in land and building either before the Assessing

Officer or before the ld. CIT(A). Considering the totality of the facts of the case

and in the interest of justice, we deem it proper to restore the issue to the file of

the Assessing Officer with a direction to adjudicate the issue afresh in the light

of the decision of Hon’ble Bombay High Court cited (supra) and as per fact and

law after giving due opportunity of being heard to the assessee. We hold and

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direct accordingly. The grounds raised by the assessee are allowed for

statistical purposes.

purposes.

Order pronounced in the open Court at the time of hearing itself i.e. on this 13th August, 2018.

Sd/- Sd/- (SUCHITRA KAMBLE) (R. K. PANDA) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: 13-08-2018. Sujeet Copy of order to: - 1) The Appellant 2) The Respondent 3) The CIT 4) The CIT(A) 5) The DR, I.T.A.T., Raipur. By Order //True Copy// Sr. Private Secretary ITAT, Raipur