LAKSHMI S ALIAS LAKSHMI HARIGOVIND,THIRUVANANTHAPURAM vs. ACIT, CIRCLE-1(2), THIRUVANANTHAPURAM, THIRUVANANTHAPURAM

O R D E R Per Bench This Appeal by the Assessee is directed against the revisionary order under section 263 of the Income Tax Act, 1961 (‘the Act’hereinafter) dated 31.3.2022 in respect of the assessee’s assessment under section 147 read with section 143(3) of the Act dated 28.12.2019 for assessment year (AY) 2012-13.

2 ITA 611/Coch/2022& SA 43/Coch/2022 Lakshmi Harigovindan v. Asst. CIT handing over agreement dated 15.10.2011. In view thereof, capital gains, not returned, was assessed at Rs.278.06 lakhs vide the impugned assessment. This stands subsequently subject to revisionary proceedings on the following grounds:

(a) The assessee’s 9.22% share was worked out at 14.660 sq.ft. on the basis of lettable carpet area, while it ought to have been on the basis of total built-up area, which resulted in a short consideration by Rs.105.25 lakhs. (b) Neither the cost of construction nor the rent capitalization method was appropriate to determine the fair market value (fmv) of the capital asset transferred, which included 9.22% share in all amenities, including 4219 sq.ft. of parking place, which valuation was in fact not undertaken by the competent authority inasmuch as it ought to have been by the District Valuation Officer (DVO) and not by theValuation Officer (VO). (c) The assessee’s undivided share in land sold was in fact at 23.115 cents out of a total of 30.865 cents (not 17.25 cents out of a total of 25 cents). The impugned order, accordingly, set aside the assessment dated 28.12.2019 for consideration of the said discrepancies and assessment afresh after referring the valuation to the DVO, and hearing the assessee in the matter/s.

3.1 Before us, the assessee’s only challenge was that there had been, in the passing the impugned order, an excess of jurisdiction by the revisionary authority in view of Explanation 1(c) to section 263(1) of the Act. This was as the impugned assessment was under appeal before the first appellate authority, toward which Shri Nair, Advocate, the ld. counsel for the assessee, would place on record copy, unverified though, of Form 35, dated nil. Adverting to Gd.4 of the Grounds of Appeal, it was submitted by him that the assessee’s rights having extinguished on the execution of the sale deed dated 04.8.2008, capital gains was assessable for AY 2009-10. The revision for the current year is, thus, misplaced.

3.2 Smt. Smt. J.M. Jamuna Devi, the Sr. DR, would draw our attention to section 263(1) of the Act, stating that no appellate order had admittedly been passed even till date, for the assessee to plead exclusion on that basis.

3 ITA 611/Coch/2022& SA 43/Coch/2022 Lakshmi Harigovindan v. Asst. CIT 4. We have heard the parties, perused the material on record, and given our careful consideration to the matter. 4.1 Explanation 1(c) to section 263(1) of the Act, which forms the basis of the assessee’s case, reads as under: Revision of orders prejudicial to revenue. 263. (1) The Principal Commissioner or Commissioner may call for and examine the record of any proceeding under this Act, and if he considers that any order passed therein by the Assessing Officer is erroneous in so far as it is prejudicial to the interests of the revenue, he may, after giving the assessee an opportunity of being heard and after making or causing to be made such inquiry as he deems necessary, pass such order thereon as the circumstances of the case justify, including an order enhancing or modifying the assessment or cancelling the assessment and directing a fresh assessment. Explanation 1.—For the removal of doubts, it is hereby declared that, for the purposes of this sub-section,— (a) ………. (b) ………. (c) where any order referred to in this sub-section and passed by the Assessing Officer had been the subject matter of any appeal filed on or before or after the 1st day of June, 1988, the powers of the Commissioner under this sub-section shall extend and shall be deemed always to have extended to such matters as had not been considered anddecided in such appeal. 4.2 The assessee’s challenge is wholly without merit. The reason/s is simple and, in fact, more than one. There is, firstly, no overlap between the three areas identified in the impugned order on which the revisionary authority finds the assessment as erroneous and prejudicial to the interests of Revenue, and the grievance/s caused to the assessee thereby, and which is therefore the subject matter of the pending appeal by her before the first appellate authority, and toward which we have perused the Grounds even other than Gd. 4 referred to for the purpose before us. Two, even if there is an overlap, inasmuch as no appellate order stands passed u/s.250 of the Act as on the date the proposal u/s. 263 was communicated to the assessee per email, i.e., 28.6.2001, much less the date of the impugned order (31.3.2022), it is the jurisdiction of the appellate authority that would stand excludedto that extent, and not that of the revisionary authority. This is in view of the words ‘extended to such matters as had 4 ITA 611/Coch/2022& SA 43/Coch/2022 Lakshmi Harigovindan v. Asst. CIT not been considered and decided in such appeal’ occurring in Explanation 1(c), so that, clearly, the jurisdiction u/s. 263gets excluded on the basis of an event that had occurred as on the date the same is sought to be assumed by the revisionary authority. Further still, the said exclusion is not on a global basis, but issue-wise, i.e., quathe matters on which the appellate jurisdiction of the first appellate authority stands since exercised. And which brings us back to our first point, i.e., of there being in fact no overlap of matters raised per the impugned order and being agitated in appeal.

4.3 Continuing further, the plea that the assessment may not survive in view of the assessee’s Gd. No. 4 contesting also the year for which the capital gains stands to be arise and, thus, assessed, before the first appellate authority, is, again, to no moment. The same relates to the land transferred on 04.8.2008, while the capital gains assessed for the current year is in respect of the rights retained by the assessee on 04.8.2008, and transferred on 15.10.2011. Even if for the sake of argument, the same is regarded as applicable to the assessee’s rights in her 9.22% undivided share in land, assessment for the current year would survive no longer, i.e., irrespective of the impugned order, or the assessment made pursuant thereto.

4.4 The assessee has before us, apart from the general Gd.A, warranting no adjudication, and Gd. BquaExplanation 1(c) to s. 263(1), also raised other Grounds, which are on the merits of the observations made by the ld. Pr. CIT. The same are clearly premature as the revisionary authority has not decided the issue/s raised by him on merits, and it is a case of open set aside by him. In fact, as would be apparent from the foregoing, no arguments qua the same were advanced before us.

4.5 In view of the foregoing, we find no reason to interfere and, accordingly, decline to. We decide accordingly.

5 ITA 611/Coch/2022& SA 43/Coch/2022 Lakshmi Harigovindan v. Asst. CIT 5. In the result, the assessee’s appeal is dismissed. Her stay petition, even otherwise premature, becomes, in view of the said dismissal, infructuous. Order pronounced in the open Court on February 03, 2023.