SHRI RAJESH SRICHAND UTTAMANI,NAGPUR vs. A.CIT, CIRCLE-4, NAGPUR

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ITA 91/NAG/2020Status: DisposedITAT Nagpur28 September 2023AY 2013-14Bench: SHRI SATBEER SINGH GODARA (Judicial Member), DR. DIPAK RIPOTE (Accountant Member)4 pages
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What did the Tribunal hold?

The Tribunal condoned the delay in filing the appeal. It held that the addition under Section 50C was not sustainable as the difference between the sale consideration and stamp duty value was within the 10% tolerance margin, and the provisos to Section 50C(1) have retrospective effect.

What were the facts?

The assessee filed an appeal with a delay of 59 days, attributing it to the COVID-19 pandemic. The appeal concerned an addition of long-term capital gains of Rs. 10,47,898/- made by the Assessing Officer and upheld by the CIT(A).

What were the issues?

Whether the addition made under Section 50C of the Income Tax Act is valid when the difference between the sale consideration and the stamp duty value is within the 10% tolerance limit, considering the retrospective effect of the provisos to Section 50C(1).

Which sections of the Income-tax Act were involved?

Section 50C

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Income Tax Appellate Tribunal, NAGPUR BENCH : NAGPUR

Before: SHRI SATBEER SINGH GODARA & DR. DIPAK RIPOTE

Hearing: 20.09.2023Pronounced: 28.09.2023

2014, arises against the CIT(A)-1, Nagpur’s Order No.CIT(A)-1/ 219/2015-16, dated 05.03.2020, involving proceedings u/s.143(3) of the Income Tax Act, 1961 (in short “the Act”).

Case called twice. None appears at assessee’s behest. He is accordingly proceeded ex-parte.

2.

We have noticed that there is a delay of 59 days in filing the appeal before the tribunal. The Assessee has placed

2 I.T.A.No.91/NAG./2020 on record a condonation petition/affidavit dated 24.06.2020 inter alia stating therein that the same is attributable to Covid- 2019 period and submitted that the delay be condoned as per hon’ble apex court’s directions in Cognizance for Extension of Limitation, In re 438 ITR 296 (SC) read with judgment in Cognizance for Extension of Limitation, In re 432 ITR 206 (SC) dated 08-03-2021 and 421 ITR 314 (SC), excluding the covid- 19 pandemic outbreak period from 15.03.2020 to 28.02.2022 for all intents and purposes under the limitation law. We, therefore, condone the delay of 59 days and proceed to decide the appeal on merits, after hearing the Learned DR.

3.

We now advert to the assessee’s sole substantive issue of sec.50C addition of long term capital gains amounting to Rs.10,47,898/- made in the course of assessment herein dated 21.08.2015 as upheld in the CIT(A)'s order. It emerges during the course of hearing with the able assistance coming from the Revenue side that the assessee had sold/transferred the following capital assets in the relevant previous year as per the Assessing Officer’s assessment at page-2 para-3 as under :

3 I.T.A.No.91/NAG./2020 4. The Revenue could hardly dispute that none of the foregoing transfer(s) executed at the assessee’s behest involved more than 10% difference as per sec.50C in light of the 3rd proviso to sub-sec.(1) thereof. Ms. Patil vehemently argued at this stage that neither of the three statutory proviso(s) in sec.50C(1) of the Act inserted in Finance Act, 2016 onwards covers the assessee’s case as we are in assessment year 2013- 2014 only. We find no merit in Revenue’s instant arguments in light of Dharamshibhai Sonani vs. ACIT [2016] 161 ITD 627 (Ahd.) and Maria Fernandez Cheryl vs. ITO (International Taxation) [2021] 187 ITD 738 (Mum.–Tribu.) holding that the legislature has inserted [1st and 2nd proviso(s) and [3rd proviso] respectively; to sec.50C(1) as curative measures which carry retrospective effect. We accordingly accept the assessee’s instant sole substantive grievance challenging the learned lower authorities action making long term capital gains addition of Rs.10,47,898/- since falling within the tolerance margin of 10% u/sec.50C(1) (3rd) proviso of the Act in very terms. Ordered accordingly.

5.

This assessee’s appeal is allowed.

Order pronounced in the open Court on 28.09.2023.

Sd/- Sd/- [DR. DIPAK P. RIPOTE] [SATBEER SINGH GODARA] ACCOUNTANT MEMBER JUDICIAL MEMBER Pune, Dated 28th September, 2023 VBP/-

4 I.T.A.No.91/NAG./2020 Copy to

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