Income Tax Appellate Tribunal - Amritsar
Baljinder Kaur, Amritsar. vs Department Of Income Tax on 15 March, 2012
IN THE INCOME TAX APPELLATE TRIBUNAL
AMRITSAR BENCH; AMRITSAR.
BEFORE SH. H.S. SIDHU, JUDICIAL MEMBER
AND SH. B.P.JAIN, ACCOUNTANT MEMBER
I.T.A. No.405(Asr)/2011
Assessment year:2008-09
PAN:AEWPK1006Q
Income Tax Officer, Vs. Smt. Baljinder Kaur,
Ward 4(1), Amritsar. C/o Jamson Motors,
Amritsar.
(Appellant) (Respondent)
Appellant By:S/Sh.Tarsem Lal & Amrik Chand, DRs
Respondent By: Sh. Padam Bahl, CA
Date of hearing :15/03/2012
Date of pronouncement:16/03/2012
ORDER
PERBENCH;
This appeal of the Revenue arises from the order of the CIT(A), Amritsar dated 05.05.2011 relating to assessment year 2008-09.
2. The Revenue has raised following grounds of appeal:
"1. On the facts and in the circumstances of the case, the learned Commissioner of Income Tax (Appeals), Amritsar is not justified in deleting the addition of Rs.68,19,139/- made by the A.O. without appreciating 2 ITA No.405(As)/2011 the facts that the assessee along with other co-owners has sold the Hotel Building situated at Dalhousie by way of agreement to sell for Rs.37,50,000/- having 17% share.
2. The Ld. CIT(A) is not justified in deleting the addition simply relying upon the ground that no outsider and non Himachal can sell and purchase the land belonging to Himachal Pradesh due to the restriction of H.P. Land Revenue Act.
3. The CIT(A) has not considered the fact that son of original seller has confirmed that possession of Hotel Building along with land appurtenant thereto was transferred to assessee along with co-purchaser after execution of the sale deed.
4. Worthy CIT(A) has not considered the fact that after execution of sale deed in favour of assessee all the legal right of property transferred to assessee."
3. The brief facts of the case are that during the course of assessment proceedings, it was noticed by the AO that the assessee has sold hotel property at Dalhousie on 14.03.2008 by way of agreement to sell for RS.37,50,000/- in which the assessee has only 17% share. Information u/s 133(6) was called for from the Sub-Registrar, Dalhousie regarding the total value of the hotel building as per the stamp duty Act purchase i.e. circle rate. In response thereto, the Sub-Registrar, Dalhousie furnished the information vide his office letter dated 24.11.2010 stating therein that the total value of the land of the above said hotel measuring 0.03.14 hectare as per circle rate for the period under consideration is Rs.4,00,67,150/- in addition to the cost 3 ITA No.405(As)/2011 of hotel building structure. Further, the AO has called for information from the original seller of the hotel, Smt. Vijender Kaur w/o Sh. Kuldip Singh V. Lohali, Dalhousie and in turn her son, Sh. Harpreet Singh has furnished an affidavit dt. 27.12.2010 in which one of the averments/deponents made is that the hotel Kohinoor situated at Mouza Barkrota Tehsil Dalhousie, district Chamba (HP) was sold and part of the vacant land was leased in the year 2001 to Sh. Manohar Singh s/o Sh. Binat Singh, Smt. Baljinder Kaur, w/o Sh. Manohar Singh, Sh. Hardeep Singh, Smt. Tajender Kaur, Sh. Harmeet Singh, both are residents of The Mall, Amritsar under the provisions of Himachal Pradesh Land Revenue Act, with the consent of the purchaser.... According to AO., the registration of land was not made as non-Himachali cannot legally buy land in Himachal Pradesh. Thus, placing reliance on Sub-Registrar, Dalhousie's report dated 14.11.2010 to the effect that the total value of the land of the above said hotel measuring 0-03-14 hectare as per circle rate prevalent at the relevant point of time is Rs.4,00,67,516/- as well as on the affidavit dated 27.12.2010 of Sh. Harpreet Singh son of the original seller, Smt. Vijender Kaur, the AO has made an addition of Rs.68,19,139/- towards long term capital gain pertaining to appellant's share of 17% as against the long term capital gain shown by her at Rs.1,20,062/- and thus determining the assessee's total net assessable at Rs.71,59,380/-. 4 ITA No.405(As)/2011
4. Before the Ld. CIT(A), the assessee made the submissions which were accepted by him and accordingly the ld. CIT(A) allowed the claim of the assessee vide para 6 of his order.
5. The Ld. DR, Mr. Tarsem Lal, appearing for the Revenue argued that the assessee has sold the hotel Kohinoor, not only the super structure but as well as the land attached thereto. Even if the arguments or explanation of the assessee before the Ld. CIT(A) are taken as correct that the assessee had sold only the super structure then purchaser is vested with the absolute right of the super-structure. Under that circumstances, the seller does not have any right in the land beneath super structure and impliedly the land is also sold along with super structure to the purchaser. This fact has been confronted by the seller's son who was available when the Inspector of the Income Tax visited the assessee's place, who had confirmed the said fact. The Sub- Registrar, Dalhousie has also submitted report on 14.11.2010. Therefore, the Ld. DR supported the order of the A.O. and prayed to reverse the order of the ld. CIT (A).
6. On the other hand, the ld. counsel for the assessee, Sh. Padam Bahl, argued on the similar lines, as submitted before the ld. CIT(A) and the said submissions are available in para 5 at pages 3 to 6 of CIT(A)'s order. The Ld. counsel for the assessee strongly relied upon the order of the ld. CIT(A) 5 ITA No.405(As)/2011 and further argued that section 50C(1) was not available in the present case since the word 'assessable' has been introduced by the Finance (No.2) Act, 2009 w.e.f. 1.10.2009.
7. We have heard the rival contentions and perused the facts of the case. The arguments made by the Ld. DR Mr. Tarsem Lal, appears to be convincing that when super structure is sold by the assessee on which the purchaser had acquired the absolute interest and the possession has been taken of the super structure and the land as well then the seller does not have any right in the land. There is no dispute to the fact whatever the consideration is passed on to the assessee has to be taken as correct consideration, in the absence of any different consideration, brought on record by the Revenue. The Valuation report by the valuer is under section 50C(1) of the Act has to be ignored, where word 'assessable' has been introduced by the Finance (No.2) Act, 2009 w.e.f. 1.10.2009 i.e. section 50C does not have any applicability in the present case. Therefore, in the circumstances and facts and in the absence of any documentary evidence against the assessee, the sale consideration declared and in view of the decision of the Hon'ble Supreme Court, in the case of K.P. Varghese vs. Income Tax Officer & Anr. Reported in 131 ITR 597 (SC), the sale consideration declared in the sale deed can not be disturbed by the A.O. 6 ITA No.405(As)/2011 Therefore, we find no infirmity in the order of the Ld. CIT(A). Thus, all the grounds of appeal of the Revenue are dismissed.
8. In the result, the appeal filed by the Revenue is dismissed Order pronounced in the open court on 16th March, 2012.
Sd/- Sd/-
(H.S. SIDHU) (B.P. JAIN)
JUDICIAL MEMBER ACCOUNTANT MEMBER
Dated: 16th March , 2012
/SKR/
Copy of the order is forwarded to :
1. The Assessee:Smt. Baljinder Kaur, Asr.
2. The ITO Ward 4(1), Asr
3. The CIT(A),
4. The CIT,
5. The SR DR, ITAT, Asr.
True copy
By Order
(Assistant Registrar)
Income Tax Appellate Tribunal
Amritsar Bench : Amritsar.