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Income Tax Appellate Tribunal, RAIPUR BENCH, RAIPUR
Before: SHRI R. K. PANDA & MS. SUCHITRA KAMBLE
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.
In appeal, the ld. CIT(A) confirmed the addition made by the Assessing
Officer on account of long term capital gain.
Aggrieved with such order of the ld. CIT(A), the assessee is in appeal
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.”
The assessee has also taken the following additional ground:-
“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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Relying on various decisions, the ld. counsel for the assessee submitted
that the ground being a legal one and since all material facts are already
available on record, therefore, this ground should be admitted.
The ld. DR on the other hand strongly opposed the admission of the
additional ground.
After hearing both the sides and considering the fact that the additional
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.
The ld. counsel for the assessee referred to the copy of the Assignment
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.
The ld. DR on the other hand submitted that since this aspect was never
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.
We have considered the rival arguments made by both the sides and
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.
In the result, the appeal filed by the assessee is allowed for statistical
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