Income Tax Appellate Tribunal - Mumbai
Shri Anil Murarilal Agarwal,Mumbai vs Income Tax Officer, Ward- 18(1)(1), ... on 24 March, 2025
IN THE INCOME TAX APPELLATE TRIBUNAL
MUMBAI BENCH "A" MUMBAI
BEFORE SHRI OM PRAKASH KANT (ACCOUNTANT MEMBER)
AND
SHRI RAHUL CHAUDHARY (JUDICIAL MEMBER)
ITA No. 4715/MUM/2024
Assessment Year: 2016-17
Anil Murarilal Agarwal Income Tax Officer, Ward-18(1)(1)
703, Purna Worli CHSL Mumbai.
Pochkhanwala Road, Worli Vs. Earnest House, Nariman Point,
Mumbai-400030. Mumbai-400021.
PAN NO. AAAPA 9215 B
Appellant Respondent
Assessee by : Mr. Rakesh Joshi
Revenue by : Mr. Ram Krishn Kedia, Sr. DR
Date of He aring : 13/02/2025
Date of pronouncement : 24/03/2025
ORDER
PER OM PRAKASH KANT, AM
This appeal by the assessee is directed against order dated 28/08/2024 passed by the Ld. Commissioner of Income-tax (Appeals)- National Faceless Appeal Centre, Delhi [in short Ld. CIT] [in short 'the Ld. CIT(A)'] for assessment year 2016-17, raising following grounds:
Anil Murarilal Agarwal 2 ITA No. 4715/MUM/2024
1. "On On the facts and circumstances of the case as well as in law, the Learned CIT(A) has erred in confirming the actions of the Learned Assessing Officer in making an addition of Rs. 1,42,86,671/-
1,42,86,671/ as alleged Short Term Capital Gain earned on account of sale of flat no 1404 and 1405 situated in Rashmi Heights, without considering the facts and circumstances of the case.
cas
2. On the facts and circumstances of the case as well as in law, the Learned CIT(A) has erred in confirming the actions of the Learned Assessing Officer in not appreciating the fact that during the year under consideration appellant has only registered the purchase/sales agreement and actual transaction happened in the A.Y. 2010-1111 and corresponding income already offered for taxation 11, therefore making an addition for the same income, In A.Y.2010-11, tantamount double taxation which is not allowable under the th Act.
3. On the facts and circumstances of the case as well as in law, the Learned CIT(A) has erred in confirming the actions of the Learned Assessing Officer in not appreciating the fact that the appellant and his wife jointly held the property in the equal proportion of share.
4. On the facts and circumstances of the case as well as in law, the Learned CIT(A) has erred in confirming the actions of the Learned Assessing Officer in not considering the purchase value of flat as mentioned in the agreement as cost of acquisition of flat, without considering the facts and circumstances of the case.
5. On the facts and circumstances of the case as well as in law, the Learned CIT(A) has erred in confirming the actions of the Learned Assessing Officer in considering the Sa Sale le consideration of flat at Rs.93,89,191/ being the value adopted for the purpose of stamp duty instead of actual sale consideration of Rs.43,11,000/ Rs.43,11,000/- without considering the facts and circumstances of the case.
6. On the facts and circumstances of the case as as well as in law, the Learned CIT(A) has erred in confirming the actions of the Learned Assessing Officer in treating the transfer of rights is void on the alleged plea that the assesse has violated terms and condition of SRA scheme without appreciating the the fact that the appellant has not purchased flat in SRA scheme.
7. The appellant craves leave to add, amend, alter or delete the said ground of appeal."
appeal.
2. Briefly stated facts of the case are that the assessee was friendly food engaged in the business of distribution of eco-friendly foo packing in the name of propriety concern namely 'M/s Beriwal he assessee filed return of income for the year International'. The under consideration on 15/10/2016 declaring total income at Rs.
Anil Murarilal Agarwal 3 ITA No. 4715/MUM/2024 6,51,090/-.. The return of income filed by the assessee was selected for scrutiny assessment and statutory notices notice under the Income issued and complied with.
Tax Act, 1961 [In short 'The Act'] were issue proceeding, the Assessing Officer(AO) During the assessment proceeding O noted that during the year under consideration the assessee registered properties, namely flat No. 1404, 14th the purchase and sale of two properties Floor Rashmi Heights, Malad, Mumbai and flat No. 1405, 14th Floor Mumbai The Ld. Assessing Officer Rashmi Heights, Malad, Mumbai. O noted that short term capital gain arising out of the sale of the flats No. 1404 and 1405 was not declared by the the assessee in return of income.
3. it was submitted by the In response to show cause notice, it assessee said that those two flats were purchased in joint name of the assessee and his wife Smt. Lata Agarwal.. He submitted that 07.10.2005 but subsequently in those flats were booked on 07.10.2005, financial year 2009-10 10 corresponding to assessment year 2010-11 were sold/transfered tohis sons namely Shri.. Abhishek Agarwal and Shri. Aadesh Agarwal respectively. The corresponding long term as offered by the capital gain arising from sale of those two flats was assessee and his wife in their respective of returns returns of income filed for A.Y. 2010-11.
11. It was submitted that those returns have been duly accepted by the department and, therefore, the tr transaction which has been already offered and accepted by the department department, onsideration. Those cannot be subjected to tax again in A.Y. under consideration Anil Murarilal Agarwal 4 ITA No. 4715/MUM/2024 contentions of the assessee were not accepted by Assessing Officer. The Assessing Officer fficer observed that those flats had been booked by the assessee in violation of the slum rehabilitation scheme (SRA) of Government of Maharashtra. er the Assessing Officer Maharashtra Further O observed that the assessee did not receive full payment against sale to Shri bhishek Agarwal and Shri Aadesh Agarwal.. The Assessing Officer Abhishek O noted that part payment of Rs. 3,00,000/-
3 and Rs. 2,31,500/-
2,31,500/ respectively was paid by the assessee to builder against the 12,33,000/ of each flat and the balance purchase price of Rs. 12,33,000/-
amount had been paid by Shri Abhishek Agarwal and Shri Aadesh Officer was of the view that Agarwal to the builder. The Assessing O the assessee could claim capital gain on the part of the investment made by him. The long term capital gain declared by the assessee in 2010-11 though noted by the assessing officer, assessment year 2010 officer was found not to be pro properly perly calculated. According to Assessing see should have offered long term capital gain on Officer, the assessee sale of properties at Rs.4,90,691/- for A.Y.2010-11, A.Y.2010 but the assessee availed benefit of exemption/deduction u/s 54/54F 54 of the Act and no long term capital gain was offered for the tax purposes.
purpose The relevant observations of the Assessing Officer are reproduced as under:
ii). Details of Sale of immovable properties in the financial year "ii).
2015-16:-
S No Description of Name of the Date of Sale Amount Market properties Purchaser Agreement (Rs) Value (Rs) Anil Murarilal Agarwal 5 ITA No. 4715/MUM/2024
1. Flat No.1404, Aadesh 16.01.2016 43,11,000 93,89,191 14th Floor, Agarwal Rashmi Heights, Malad Mumbai
2. Flat No. 1405, Abhishek 28.09.2015 43,11,000 93,89,189 14th Floor, Rashmi Heights, Agarwal Malad, Mumbai During the assessment proceedings, the assessee claimed that he has sold two properties (Flat No. 1404 & 1405) in F.Y. 2009 2009-10 i.e. A.Y. 11 and consequently, long term capital gains on from transfer/sale 2010-11 of these flats were offered in A.Y. 2010 2010-11.
11. In support of his claim he has 2009 written to M/s. Rashmi Infra-structure submitted letter dtd. 12.12.2009 12 Infra Shri Abhishek Agarwal and Shri Developers Ltd. for transfer of flats to Shri. Infra structure Developers Ltd.
Aadesh Agarwaland in turn M/s. Rashmi Infra-structure has written letter dtd. 13.12.2009 to Shri Abhishek Agarwal and Shri Aadesh Agarwal for accepting the transfer. The assessee also submitted the copy of return of Income for A.Y. 2010 2010-1111 alongwith computation of income of Shri Anil Agarwal and Smt. Lata Agarwal.
As per computation filed by the assessee, he has offered LTCG on sale of the property in A.Y. 2010 2010-11 as under.
Flat No. Sale Date Sale Value Indexed LTCG Investment
Cost in new
Cost Date Cost Value property
(Rs)
1404 11/12/2009 21,55,500 7,83,960 13,71,540 15,95,750
07/10/2005 6,16,500
1405 11/12/2009 21,55,500 7,83,960 13,71,540 15,95,750
Anil Murarilal Agarwal 6
ITA No. 4715/MUM/2024
07/10/2005 6,16,500
As per tabulation above, the assessee has claimed that he has re- re
invested the sum u/s 54 of the 17.Act, 1961 of the LT Act, 1961, received from Long Term Capital Gain (LTCG) from sale of the above mentioned two flats in new properties and hence. LTCG as Nil offered in come. However, the assessee has not filed any details his return of income.
agreement for the claim of his investment u/s 54 of the IT. Act. However, the assessee has given wrong, calculation taking wrong indexation cost of acquisition of the properties and hence, evaded tax on LTCG on sale of properties. The assessee has taken full value of consideration as cost of acquisition for calculation of capital gain, even after he has not paid full amount of consideration to the seller till the date of so called claim of sell of these properties to Shri Abhishek Agarwal and Shri. Aadesh Agarwal. The assessee has also divided cost of acquisition of the co owner, Smt. Lata Agarwal, even after, she has properties equal with co-owner, not invested any sum for purchase of flat no. 1404 Smt. Lata Agarwal Agarw 1,50,000/ on 16.03.2006 for purchase of flat no. has invested Rs. 1,50,000/-
1405. The assessee can claim indexation on the part of the investment made by him.
If, it is assumed that the assessee's all claims/data/documents are correct than the night calculation of LTCG are as under:
Flat Sale Date Sale Value Indexed LTCG Investment LTCG to No. Cost offered by in new be offer Cost Date Cost the property Value assessee (Rs) 1404 12/12/2009 21,55,500 3,81,489 17,74,011 15,95,750 1,78,261 28/03/2006 3,00,000 1405 12/12/2009 21,55,500 2,47,320 19,08,180 15,95,750 3,12,430 27/06/2006 2,03,100 4,90,691 Anil Murarilal Agarwal 7 ITA No. 4715/MUM/2024 Hence, it can be seen from above table that the assessee should have offered LTCG on sale of the properties of Rs. 4,90,691/. for A.Y. 2010-11 but he has not offered any LTCG for taxation.
It is also important to mention here that, the assessee has neither registered/made any agreement with the Seller (builder) nor with the buyers(Shri Abhishek Agarwal and Shri Aadesh Agarwal)till the end of 2010 11 as claimed by the assessee as arriving capital gain financial year 2010-11 on sale of immovable properties. The assessee has not given any details 43,11,000/- for each flats. The about how he has taken selling price of Rs. 43,11,000/- selling price of the flats first came to re record cord while registered the documents in F.Y. 2015-16.
4. The Ld. Assessing Officer Officer accordingly rejected the contentions of the assessee and assessed difference of sale assess the d consideration and purchase consideration recorded in ,42,86,671/- as short registered sale deeds amounting to Rs. 1,42,86,671/ term capital gain in the assessment order passed u/s 143(3) of the Act on 29/12/2018.
29/12/2018 On further appeal, the Ld. CIT(A) also noted that, firstly the assessee had purchased flats in Scheme Secondly, the assessee failed to violation of the SRA Scheme, furnish any agreement to the effect of transfer of the property by the assessee in assessment year 2010 11, Thirdly, the 2010-11 assessee failed to furnish any document/evidence evidence in support of the possession of the immovable property under consideration.
5. Before us the Ld. counsel for the assessee has filed a paper book containing pages 1 to 152. The Ld. counsel for the red to the purchase and sale deed registered assessee referred under the year under consideration in respect of flat No. 1404 Anil Murarilal Agarwal 8 ITA No. 4715/MUM/2024 and 1405, which are available on paper book pg. No. 89 to 101 and 102 to 136 of the paper book respectively. The Ld. counsel also referred to the allotment letter of the flat No 1404 and pages No.1 to 3 and 4 1405, which are available on paper book page of the paper er book respectively.. The Ld. counsel also referred to the income tax return and computation of income of the assessee for A.Y. 2010 2010-11, available on paper book page No. rn of income filed by his wife Smt. 27 to page No. 54 and return S Lata Agarwal, a copy of which is available on paper book page no. 55 to page no. 80 of the paper book. The Ld. counsel for the assessee filed copy of the memorandum of agreement entered into by the assessee with his sons Shri. Abhishek Agarwal and Shri. Aadesh Agarwal for sale of the respective 2009-10.. In view of the above flats in financial year 2009 documents, the Ld. counsel for the assessee submitted s that the capital gain arising on the sale of those two flats has already been offered by the assessee in return of income incom for
11. He submitted that only registration documents A.Y. 2010-11. document have been prepared in the assessment year under n view of the conditions imposed by the builder consideration, in flat had already transferred in the name of and in effect the flats Shri. Abhishek Agarwal and Shri. Aadesh Agarwal, Agarwal who are sons of the assessee. The Ld. counsel for the assessee relied re on the decision of the Hon'ble High Court of Delhi in the case of K. Ramakrishnan Ramakrishna reported in (2014) 48 taxman.com 55 Anil Murarilal Agarwal 9 ITA No. 4715/MUM/2024 (Delhi)/[2014] 225 Taxman 123 (Delhi), wherein the date of allotment has been held to be date of purchase of the property and not the date of registration of conveyance deed deed. The Ld. counsel also relied on the decision of the coordinate bench of the Tribunal in the case of Anita D Kanjani ani in ITA No. 2291/Mum/2015 for A.Y. 2011 2011-12, wherein also the holding period of the property has been held to be computed from the date of issue of the allotment letter. The Ld. counsel submitted that in the instant case those flats were allotted in the financial year 2004-05 2004 and, therefore, sale in the A.Y. 2010-11 2010 gain, which has already been was liable for long term capital gain declared by the assessee and hence no addition for short term capital gain was required to be assessed in the year under consideration.
6. On the contrary, Ld. DR relied on the order of the lower authorities.
7. We have heard rival submission of the parties and perused the relevant material on record. he issue in dispute in the case is record The period of the property should be whether the holding period computed from the date of the conveyance deed or from the letter Firstly, in date of the allotment letter. n the case the assessee filed the copy of the allotment letter of the flats has already file pages 1 to 4. On perusal of which are available on paper book page documents, we find that builder M/s Rashmi the relevant document Infrastructure Developers ltd. had allotted the two flat nos.
n Anil Murarilal Agarwal 10 ITA No. 4715/MUM/2024 1404 and 1405 to the assessee along with his wife, Smt. Lata Agarwal under the sale part of the SRA scheme.
scheme In the case of Anita D Kanjani(supra), Kanjani the coordinate bench of the Tribunal held that the date of the allotment letter should be considered for holding period of the property. Therefore, the said date to be treated as date of the purchase of the property rrather than the date on which the purchase deed of conveyance was Secondly, as far as entered into the year under consideration. Secondly sale of the property is concerned though the property has been registered for the purchase and sale in the year under consideration but the assessee had already entered into agreement for sale of flat No. 1404 and 1405 in financial year 2009-10 2010 11 and declared the long 10 corresponding to A.Y. 2010-11 term capital gain arising on sale and against the said long term capital gain the assessee claimed deduction u/s 54/54F 54 of the Act. The said long term capital gain declared by his wife is appearing in the copy of the return of income filed file by the 2010 11. Though, the assessee and his wife for the A.Y. 2010-11. ssessing officer has pointed out certain mistakes in the Assessing 54 of the Act for AY 2010- computation of the deduction u/s 54F 11, but said assessment year is not available before us and, and therefore, we can't go into correctness of the same. But B the assessing officer cannot ignore the said long term capital gain declared in A.Y. 2010-11 2010 and assessee the gain arising from the sale of the property in the year under consideration as Anil Murarilal Agarwal 11 ITA No. 4715/MUM/2024 short term capital gain, without any valid reason for rejection of capital gain shown in AY 2010-11.
2010 Thirdly, the Ld. counsel for the assessee has rightly pointed out the assessee has se flats under sale component of the SRA purchased thos scheme and not under the slum occupation pation category. The finding recorded by the Assessing Officer to that extent is Officer incorrect.
discussion we are of the opinion that the
8. In view of aforesaid discussion, registration of the flat No. 1404 and 1405 for purchase and sale entered into the year under consideration are liable for any capital gain tax as the assessee had already declared the said transaction nsaction of the sale in A.Y. 2010-11, which has been department. The grounds of the appeal of duly accepted by the department.
the assessee are accordingly allowed.
9. In the result the appeal of the assessee is allowed.
Order pronounced 24/03/2025. nced in the open Court on 24/03 Sd/-- Sd/- Sd/ (RAHUL RAHUL CHAUDHARY CHAUDHARY) OM PRAKASH KANT) (OM KANT JUDICIAL MEMBER ACCOUNTANT MEMBER Mumbai; Dated: 24/03/2025 Disha Raut Copy of the Order forwarded to : 1. The Appellant 2. The Respondent. 3. CIT Anil Murarilal Agarwal 12 ITA No. 4715/MUM/2024 4. DR, ITAT, Mumbai 5. Guard file. BY ORDER, //True Copy// (Assistant Registrar) ITAT, Mumbai