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Income Tax Appellate Tribunal, BENCH “E”,MUMBAI
Before: SHRI B.R. BASKARAN & SHRI PAWAN SINGH
Order Under Section 254(1) of Income Tax Act PER PAWAN SINGH, JM:
1. 1. These two cross appeal u/s 253 of the Income-tax Act (‘the Act’) are filed against the order of Ld. Commissioner of Income-tax (Appeals) [for short ‘the CIT(A)] –31 Mumbai dated 15.09.2010 for Assessment Year (AY) 2006-07.
2. The Revenue has filed its appeal on the following grounds: (i) The Ld. CIT (A) has erred on facts and in law and in the circumstances of the case in allowing the relief to the assessee in respect of application of provision of section 50C. While allowing relief to the assessee the Ld. CIT(A) considered 2 & 8958/M/2010 M/s. Sales India the fact that the premises sold by the assessee is not registered with the concerned authority of the State Government. (ii) The appellant prays that the order of the CIT(A) on the above ground(s) be set aside and that of the Assessing Officer be restored. The assessee has raised the following grounds of appeal: (i) Commissioner of Income Tax (Appeals) erred in not allowing the deduction for the value of furniture and fixtures air conditioner etc. amounting to Rs. 4,35,795/- (W.D.V.) from sale consideration of Rs. 2,08,20,000/- (ii) Commissioner of Income Tax (Appeals) erred in not granting indexation cost from the date of purchase of property i.e. Financial Year 1982-83. (iii) Alternatively the Commissioner of Income Tax (Appeals) should have granted the indexation from the year of construction of building i.e. 1987. (iv) Commissioner of Income Tax (Appeals) erred in not allowing Non owner occupancy charges of Rs. 22,381/- as deduction from gross rent received as the said charges are payable only when property is let out.
Brief facts of the case are that the assessee filed return of income for relevant AY on 27.10.2006 declaring total income of Rs. 5,51,520/-. The assessment was completed u/s 143(3) of the Act on 28.11.2008. The Assessing Officer (AO) while framing the assessment order disallowed the expenses of Rs. 22,381/- against the rental income. The AO further worked out a Capital Gain of Rs. 2,22,49,284/- against the Capital Gain declared by assessee on sale of property at Rs. 1,58,39,265/-. Thus, the AO added a difference of Rs. 64,12,019/- in the total income of the assessee and disallowed the set off of Long Term Capital Loss (LTCL) on sale of Mutual Fund while determining the Long Term Capital Gain (LTCG). On appeal before the ld. CIT(A), the Assessing Officer (AO) was directed the AO to consider the sale consideration shown by the assessee as full value of consideration for the purpose of LTCG of the property and rejected the claim of setting of LTCL on sale of Mutual Fund. The disallowance of expenses against the rental income was sustained holding that the ground was withdrawn by ld. Authorized Representative (AR) as per his letter dated 16.01.2002. Thus being aggrieved by the order of ld. CIT(A) both the parties filed their cross appeal.
We have considered the rival contention of the parties and have gone through the order of authorities below. At the outset of the proceeding, ld. AR of the assessee submitted that assessee has filed an application for filing of additional evidence under Rule 29 of Income-tax (Appellate Tribunals) Rules, 1963. The ld. AR of the assessee in support of his application argued that the assessee seeks the leave of the Court to 3 & 8958/M/2010 M/s. Sales India file the fresh evidence, which consist of agreement to sale dated 6th May 1982 and other documents. These document could not be produced before the lower authorities, as the document are very old and were not traceable during the proceeding before the lower authorities. The relevancy of the document goes to the root of the claim of the assessee for claiming benefit of indexation from Financial Year (FY) 1982-83 for the purpose of calculating Capital Gain. On the other hand, ld. DR for the Revenue objected for filing of fresh and additional evidence which was not placed before the lower authorities.
We have considered the rival contention of the parties and considered the relevancy of the document which are the documents by virtue of which the assessee acquired the property in 1982. Considering the relevancy agreement and the other document filed in support of assessee’s contention is admitted as additional evidence. Since the evidence is filed for the first time before the Tribunal, hence, we deem it appropriate to restore the Ground No. 1 to 2 of assessee’s appeal and the Ground of appeal
raised by the Revenue in its appeal to the file of AO to examine the documents and pass order in accordance with law with regards to the issue/ claims raised before Tribunal. Needless, to say the AO shall provide sufficient opportunity before considering the claim of the assessee in view of the fresh additional evidence placed before the Tribunal. Thus, the Ground No. 1 to 2 in assessee’s appeal and Ground Nos. 1 & 2 raised by Revenue are allowed for statistical purpose.
6. Ground No3 was raised by assessee in alternative to ground No.1 and 2. As we have already restored the ground no. 1&2 to the file of AO, hence, this ground needs no adjudication.
7. Ground No.4 of assessee’s appeal relates to confirming the occupancy charges against the rental income. We have perused the order of ld. CIT(A). The ld. CIT(A) in paragraph 6 of its order has specifically mentioned that “Ground No.6 is not pressed” which is withdrawn by the AR as per letter dated 16.01.2010 and therefore, same is not separately adjudicated. The Ld. AR of the assessee neither argued anything nor shown any evidence that the ground was not withdrawn/not pressed before the ld. CIT (A). Thus, this ground of appeal is dismissed.
8. In the result, appeal of the Revenue is allowed and the appeal of assessee is partly allowed.