TaxTMI 
TaxTMI 
1978 (3) TMI 127
X X X X Extracts X X X X
X X X X Extracts X X X X
....nt of the accounts of the said firm. The Court appointed an Arbitrator who gave the award. The Arbitrator, however, could not dispose of all the assets of the Company and subsequently the Court directed the receiver to dispose of the assets of the dissolved firm. Ultimately, as a result of auction held on 27th and 29th Aug., 1966 the highest bid of the property to be auctioned came to Rs. 1,50,000. the Receiver also executed a sale deed on 1st Oct., 1966 and the sale proceeds were classified as under:- (a) Property and land sold for Rs. 25,000 (b) Machinery sold for Rs. 1,25,000 After the execution of the sale deed on 1st Oct., 1966, the Court informed the ITO Beawar vide its letter No. 3371 dated 13th Dec., 1966, that if any Income-tax was chargeable on the sale of the assets of the dissolved firm, the same may be recovered. On receipt of the said letter, the ITO Beawar vide his letter No. 3674 dated 30th Dec., 1966 required the Court to deposit Rs. 25,000 on account of advance-tax. The required amount was deposited in the account of the Government in the month of May, 1967. Later on, notice under s.139(2) of the Act was issued by the ITO. It was served on to offici....
X X X X Extracts X X X X
X X X X Extracts X X X X
....apital Gains: . Rs. 1,00,695 Thus the learned ITO issued a demand notice and challan for recovery of Rs. 25,000 under s. 210 of the Act. 5. Before the learned AAC the assessee reiterated the same points which were agitated before the learned ITO. 6. The learned AAC was of the opinion that in view of the value given in the sale deed in question the learned ITO was right in computing the capital gains. 7. Before us, on behalf of the assessee more or less the same contentions were agitated which were advanced before the authorities below. The main contention of the assessee before us was that each year is independent year. The assessee has every right to compute capital gains on the basis of the material on record. The assessee filed detailed affidavit of the partner stating all the facts and clearly stated that the value of the machinery disclosed the sale deed was highly appreciated. Actually the value of the machinery at the time of sale deed was only Rs. 25,000 because the machinery grew old on account of its long use. It was also stated that the value of the building and the land should have been taken at Rs. 1,25,000. If the learned ITO was not satisf....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ortage. Basantilal Maheshwari, Advocate. 4. That the total amount realised from the assets amounted to Rs. 1,50,000 5. That the bifurcation of the said amount in two heads namely; (1) Property and land; (2) Machinery: were done as gathered from the sale deed showing the value as under: Immovable property . Land Rs. 25,000 & Machinery Rs. 1,25,000 . Rs. 1,50,000 6. That the Receiver Sh. Basantilal deposited Rs. 25,000 in Income-tax Department to discharge the liability of the tax, if any. 7. That I (as Ex-partely) in consultation with other partners got the valuation made by approved Government valuer (appointed by Income-tax Department) to present correct position before the Income-tax Authorities of the value of immovable property and land which belonged to Ajmer Merwara Cotton Press. 8. That in adopting the rules prescribed by IT Act, the valuation of the immovable property was made for two periods i.e. the value as stood on 1st April, 1954 and on the date of sale of the said immovable property and land as in 1965. That the value shown by the valuer for immovable property and land is as follows: (a) 1st April, 1954 Rs. 1,23....
X X X X Extracts X X X X
X X X X Extracts X X X X
....s in the affidavit were correct. The Honourable High Court in coming to this conclusion followed the decision in the case of Mehta Oarikh & Co. (1) 10. It is significant to note that the authorities below did not say a word as to why the detailed affidavit of the partner should not be accepted. Again the assessee filed report of the valuer. The reference of which was made in the affidavit. The valuer has given clear finding that the value of the immovable property in the year 1954 including the land was Rs. 1,23,501. The learned valuer has given the details as to how he worked out the value of the immovable property as on 1st Apr, 1954 at the said figure. The valuer has also given the details of immovable property. In his report it was clearly stated that the land was 36 bighas, 19 biswas and 10 Bishwantis. He also found that there were few constructions on this land as shown on that plant. The age of the construction was taken by him as 50 years in the year 1954. The learned valuer worked out the value of the land and building on the basis of standing order issued by the Chief Engineer, P.W.D. from time to time. The valuer has given all possible details in his report. Even, the....