Income Tax Appellate Tribunal - Delhi
Sahara India Housing Corporation Ltd,, ... vs Department Of Income Tax on 29 October, 2010
1 WTA Nos. 1, 2 & 3/D/2011
Asstt.Year: 2001-02, 2002-03, 2004-05
IN THE INCOME TAX APPELLATE TRIBUNAL
DELHI BENCH `H' NEW DELHI
BEFORE SHRI B.C. MEENA, ACCOUNTANT MEMBER
AND
SHRI CHANDRA MOHAN GARG, JUDICIAL MEMBER
W.T.A.No.01/Del/2011
Assessment Year : 2001-02
W.T.A.No.02/Del/2011
Assessment Year : 2003-04
W.T.A.No.03/Del/2011
Assessment Year : 2004-05
Dy. Commissioner of Income Tax, vs Sahara India Housing Corporation
Central Circle-6, Room No. 334, Ltd., 1, Kapoorthala Complex,
ARA Centre, Jhandewalan Extn., Aliganj, Lucknow.
New Delhi. (PAN: AADCS8698C)
Appellant) (Respondent)
Appellant by: Shri J.J. Mehrotra, D.R.Rajan
Respondent by : Shri Sameer Sharma, Sr.DR
ORDER
PER BENCH These appeals have been preferred by the revenue against the order of Commissioner of Income Tax(A)-I, New Delhi dated 29.10.2010 passed in Appeal No. 194/06-07, 272/06-07 and 508/06-07 for AY 2001-02, 2003-04 and 2004-05 respectively by which first appeals filed by the assessee have been partly allowed against the order of the AO passed u/s 16(3) of the Wealth Tax Act, 1957.
2 WTA Nos. 1, 2 & 3/D/2011Asstt.Year: 2001-02, 2002-03, 2004-05
2. The assessee/appellant has taken similar ground in these appeals except amount of addition. Ground no. 1 & 3 in all appeals are general in nature which need no adjudication. Remaining ground no. 2 in all three appeals reads as under:-
"2. On the facts and in the circumstances of the case, the ld. CIT(A) has erred in law and facts in deleting the addition of Rs....... made by the Assessing Officer in the value of land."
3. We have heard arguments of both the parties and carefully perused the record placed before us. Ld. assessee's representative submitted that in all these three appeals, the main issue involved is pertaining to valuation of land at Sultanpur Road, Tehsil Mohanlal Ganj, District Lucknow which was shown by the assessee in its books of accounts at Rs.31,93,297/-. The AR has drawn our attention towards order of CWT(A)-I, New Delhi dated 18.8.2008 in Appeal No.136/06-07 for AY 2002-03 by which above issue has been decided and restored to the file of Assessing Officer with following observations, findings and directions:-
"4. I have gone through the submissions of the appellant and the reasoning given by the Assessing Officer. The land in question was appearing in the Balance Sheet of the appellant company the same has to be valued as per sub-rule (2) of the rule 14 of schedule III of the Wealth Tax Act. The A.O. never made a reference to the Valuation Officer as provided in rule 20 if he was not satisfied with the value of the land disclosed by the 3 WTA Nos. 1, 2 & 3/D/2011 Asstt.Year: 2001-02, 2002-03, 2004-05 appellant. Further as per rule 20 sub rule (1) the value of any asset other than cash and being an asset which is not covered by rule 3 to rule 19 only can be estimated by the Assessing Officer. The Assessing Officer is directed to value the land as per the observations of the Hon'ble I.T.A.T. in the case of M/s Sahara India Savings & Investment Corporation Limited for the A. Y. 1991-92 to 1993-94 in W.T.A. No.1, 2 and 9/Alld of 1998 dated 14.9.2000 in which the Hon'ble Tribunal has held that in the case of business asset the value has to be determined as per rule 14 and not as per rule 20 of Schedule III."
4. The AR pointed out that against above order of the first appellate authority for AY 2002-03, the department has not filed any further appeal before the ITAT.
5. The counsel has also drawn our attention towards fresh certificate of incorporation consequent on change of name dated 16.3.2008 by which the name of the assessee company has been changed from Sahara India Housing Corporation Ltd. to Sahara India Finance & Investment Ltd. w.e.f. the date of issuance of certificate. This certificate has not been disputed by the DR.
6. The AR further submitted a copy of the order dated 28.6.2013 of ITAT Delhi 'H' Bench in WTA No. 6, 7 & 14/Del/2012 for AY 2005-06, 2007-08 and 2008-09 and contended that the issue of valuation of same land which is involved in these appeals in hand has been decided by ITAT in favour of the assessee and the issue involved in the present appeals in hand is squarely covered in favour of the assessee by the decision of the Tribunal 4 WTA Nos. 1, 2 & 3/D/2011 Asstt.Year: 2001-02, 2002-03, 2004-05 and Hon'ble Jurisdictional High Court. On specific query from the Bench, ld. DR fairly accepted that the order of the Tribunal dated 28.6.2013 (supra) is related to the same issue of valuation of the same land which is involved in the present appeals before us. The relevant observations of ITAT in assessee's own appeals dated 28.6.2013 (supra) read as under:-
11. We have heard the rival contentions in light of the material produced and precedent relied upon. Ld. Counsel of the assessee claimed that the issue involved is covered in favour of the assessee by the decision of the Tribunal and the Hon'ble High Court in this regard.
12. We find that the ITAT in the case of M/s Sahara India Savings & Investment Corporation Ltd. vs. ACIT for A.Yrs. 1991-92 to 1993-94 vide order dated 14.1.2000 has adjudicated the issue as under:-
"12. We have heard the Ld. Departmental Representative as well as the assessee's counsel. The Ld. Departmental Representative first of all submitted that the Assessing Officer, while determining the value of immovable properties, has adopted the rates as declared in the valuation report furnished by the assessee itself and, therefore, the Assessing Officer was justified in determining the value by exercising his powers under Rule 20 of Schedule III to the Wealth Tax Act and the CWT(A) was not justified in directing the Assessing Officer to take the value of immovable property as returned by the assessee. The counsel for the assessee, on the other hand, first of all pointed out that the valuation report relied on by the Assessing Officer was for assessment year 1994-95 as has been mentioned by the Assessing Officer at page 3 of the assessment order itself and, therefore, that report was not relevant for determining the value of properties as on 31.3.1993. Proceeding further, the assessee's counsel submitted that the immovable properties being used by the 5 WTA Nos. 1, 2 & 3/D/2011 Asstt.Year: 2001-02, 2002-03, 2004-05 assessee for its business, the value of the same was to be determined as per Rule 14 of Schedule III and not as per Rule 20, as has been canvassed by the Revenue. Further explaining the provision of Sec. 40, the counsel for the assessee submitted that Global valuation of the assets of business in assessee's case was to be taken on the basis of book value as defined in Rule 14(2)(a)(ii) of the Schedule III and the assessee having declared the value as per book, which was the purchase value, the Assessing Officer was not justified in determining the fair market value for the purpose of wealth tax.
13. After considering the rival submissions, facts and circumstances of the case, and provision of Schedule III, we are inclined to agree with the submissions of the counsel for the assessee that the assets being business assets, its value was to be determined as per Rule 14 and not as per Rule 20 of Schedule III. Consequently, we do not find any infirmity in the order of the CWT(A), which is confirmed."
13. We further find that Hon'ble Jurisdictional High Court in the case of M/s Sahara India Savings and Investment Corporation Ltd. Vs. ACIT for A.Y. 1991-92 to 1993-94 vide order dated 21.9.2010 has concluded as under:-
"In this case we are concerned with the immovable property (land) being business asset of the assessee. The value of the immovable property, as business asset of the assessee has to be taken in accordance with the Rule 3 in Schedule III appended to the Wealth Tax Act. It is only if any condition under Rule 8 is satisfied, that the assessing authority could have referred to and determine the value under Rule 20. The provisions of Rule 14(2)(b) are not applicable to the present case as no depreciation is admissible to the asset being immovable property as shown in the account books of the assessee with a definite value."
14. In light of the above decisions, we are of the considered opinion, the issue involved in these cases are 6 WTA Nos. 1, 2 & 3/D/2011 Asstt.Year: 2001-02, 2002-03, 2004-05 squarely covered by them. Accordingly, we do not find any infirmity in the order of the Ld. Commissioner of Income Tax (A) in these cases. Accordingly, we affirm the same."
7. On careful consideration of rival contentions in the light of material and documents produced before us and decision of Hon'ble High Court and Coordinate Bench of this Tribunal relied upon by the assessee, we are of the considered opinion that the issue involved in the cases in hand is squarely covered by the decision of ITAT 'H' Bench dated 28.06.2013 (supra) as the issue of valuation involved is related to the same land situated at Sultanpur Road, Tehsil Mohanlal Ganj, District Lucknow for which the assessee company has shown initial value in the balance sheet at Rs.31,93,297/-. The main issue in all these appeals is related to the estimation of appreciation thereon and thereby making addition to the wealth of the assessee. We are in agreement with the observations and findings of the Tribunal in the case of Sahara India Savings & Investment Corporation Ltd. vs ACIT (supra) that the assets being business assets, its value was to be determined as per Rule 14 and not as per Rule 20 of Schedule III. Accordingly, we are unable to see any infirmity, perversity or any other valid reason to interfere with the orders of the first appellate authority i.e. Commissioner of Income Tax, New Delhi and we uphold and confirm the same.
7 WTA Nos. 1, 2 & 3/D/2011Asstt.Year: 2001-02, 2002-03, 2004-05
8. In the result, sole ground of the revenue in all three appeals being devoid of merits is dismissed and consequently, the appeals of the revenue stand dismissed.
Order pronounced in the open court on 24.04.2014.
Sd/- Sd/-
(B.C.MEENA) (CHANDRA MOHAN GARG)
ACCOUNTANT MEMBER JUDICIAL MEMBER
DT. 24th APRIL 2014
'GS'
Copy forwarded to:-
1. Appellant
2. Respondent
3. CIT(A)
4. CIT 5. DR By order
Asstt. Registrar