TaxTMI 
TaxTMI 
2021 (6) TMI 540
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....action. The CIT(A) has further erred in holding the action of the AO in adopting such higher Sale value of Land at Rs. 90,19,200/- on arbitrary basis based on an internal departmental communication and incomplete proceedings under the Stamp Law and based on same making addition of Rs. 14,19,200/- under the Income head "Income from Capital Gains". Such higher replaced Value of Land for Stamp Duty purposes having neither been conveyed to the Parties to the transaction nor any additional stamp duty on such incremental value of land having been recovered from the parties to the transaction in the 12 year period after such date of actual registration of Document on 28/30.05.2008. Further, while doing so, the CIT(A), overlooking a specific clarification on the issue sought by the company under RTI Act from the Dy. Inspector General of Stamps dt. 5th Feb.,2018 who outrightly denied of any such Revisional proceedings which were relied upon by the AO for re-opening the case after 8-9 years and in reassessing the total income." 2. At the outset, it is noted that there is a delay in filing the present appeal by the assessee company. In this regard, the ld. AR submitted that the assessee in i....
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....not be the ground for condoning the delay in filing the present appeal before the Tribunal. 4. Heard both the parties and pursued the material available on record including the affidavit filed by the assessee in support of its condonation application. In the instant case, we find that there has been a change in the jurisdiction of the Commissioner Appeals during the pendency of the appeal where the matter was heard initially by ld CIT(A) Jaipur and thereafter, by ld CIT(A), Ajmer who has finally passed the impugned order and during such appellate proceedings, the assessee has filed certain clarification regarding reference/revaluation of the value of the property which has been obtained and received in response to its RTI application and which has apparently skipped the attention of the ld CIT(A) and thereafter, the assessee has been pursuing the matter seeking rectification which is pending adjudication till date. We therefore find that where the assessee claims that such a clarification which has been issued by a competent regulatory authority is critical for determining the issue at hand and the matter was regularly pursued by the assessee before the ld CIT(A), and the assessee....
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....tions Authorities, which action in any manner cannot be considered to be: a. A failure on part of the Assessee in disclosing fully and truly all material facts necessary for its assessment for that A/s Yr. [First Proviso to Sec.147] or b. Understatement by the Assessee of its Income or claiming excessive Loss/ deduction/ allowance/ relief in the return.[Explanation 2 (b)to Sec.147] OR c. the Assessee fulfilling any of the other conditions prescribed under the Sec.147 for justifying the action of reopening/ reassessment. 1.3 Pursuant to the Notice u/s 148 issued to the company, the Co. demanded copy of 'Reasons Recorded' alleging escapement of assessment/ income and in response to which, the AO, vide its Letter No. 180 dt. 24.04.2016 furnished the following reasons for issuance of Notice U/s 148 for Reassessment : "During the year the assessee company sold a property for Rs. 76,00,000/- on 28.05.2008. As per information received from sub-registrar of Jaipur district. The sub registrar has valued the property at Rs. 90,19,200/- against the value of Rs. 76,00,000/- shown as sale consideration by the assessee, in the ITR for the A. Y. 2009-10, it is seen that assessee has cal....
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....ar period since such alleged reference. iii. No Notices received for any such proposed revision alleged either by the Purchaser or Seller parties nor any remain pending as per parties confirmation. iv. The above Notice neither mentions the area of property or the basis for its Proposed revision or even the date of such subsequent visit for reassessment etc. v. Alleged reference so made remains unconcluded till date in absence of any reference to the date of any such approval having been given. Thus any reliance on an unconcluded reference/ proposal for revision in value of properties is bad in law and against the provisions of natural justice and hence to be dropped. 1.7 Further, without prejudice to the aforesaid, even the Provisions of Sec. 50C of ITA do not permit any such Reassessment on Revision of Stamp Duty Value of the Property. The reference in the section is to the "value adopted or assessed (or assessable) by any authorities of the state govt. (Stamp Valuation Authorities)" and on simple reading of same, it is evident that situations such as the present case as that of "revision" or "reassessment" in value is neither envisaged nor permitted under the section (S....
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....cument on 28/30.05.2008. Thus adoption of such arbitrary value of Rs. 90,19,200/- under provisions of Section 50C in place of the actual Transaction / Registration value of Rs. 76,00,000 and accordingly making addition to Total Income is thus bad in law. Submissions: 2.1. It is more then clear from a simple reading of Sec.50C of ITA that " the value adopted or assessed by any authority of a State Government (hereafter in this section referred to as the "stamp valuation authority") for the purpose of payment of stamp duty in respect of such transfer, the value so adopted or assessed shall, for the purposes of section 48, be deemed to be the full value of the consideration received. " 2.3. The Assessee company offered its income for taxation on the basis of a duly registered Sale Deed considering its value by the then Stamp Authorities at Rs. Rs. 76,00,000 and thus its such action cannot be deemed to be a failure in disclosing fully and truly all material facts necessary for its assessment, which is an essential condition precedent/ to exist for reassessment under first proviso to sec 147 of ITA. 2.4. Attention was also drawn to the alleged arbitrary proceedings by the Stam....
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....ence made by the Stamp Authorities in the matter. Further under any rule of Law, such revisions or alleged revisions after such long time gaps of 7-8 years without even any opportunity being afforded to the effected parties is against the Rule of Law and is objected to. 2.8 The assessee company through its advocate Mr. Ajay Kumar Bhargava, who also assisted the company in the process of Registration of Sale Deeds in 2008, also made an enquiry in the matter of any such reference made by the Sub Registrar-IV, Jaipur vide communication dt. 21.01.2009 to his Superior Officer but despite a reasonable effort of his at the office of the Collector Stamps to ascertain the outcome of such Reference on 21.01.2009 made in the matter of revaluation / reassessment of the property sold but despite all the efforts, could not arrive at any trail of such Reference or of its revision/ revaluation. Nor any pendency to such reference is on record of such department. Mr. Ajay Kumar Bhargava, Advocate accordingly based on his research issued a confirmatory Certificate in support of above factual position viz., that there was No such Reference or Revision in the valuation of such Property after its Re....
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....Supplementary Written Submissions" on 20th July, 2018 who heard and closed the Appeal hearing on said date. The Appeal No. then being E-308/16-17 with CIT(A)-2, Jaipur. 2.13. Unfortunately thereafter, the Order in said Appeal remained to be passed by the learned CIT(A)-2, Jaipur despite the hearing having been concluded by her and the case got transferred under certain administrative powers of the CCIT or equivalent, and for which no formal intimation/advise in the matter was issued to the Assessee company. 2.14. Later on 13.10.2018, the AR of the Assessee company received a Notice of hearing dt. 10.10.18 for the very same A/s Yr. in case of the Assessee but with different Appeal No. viz., 92/2016-17 from CIT(A), Ajmer for hearing on 17.10.2018 camping at Jaipur at ITAT building. On which date (17.10.2018), the AR of the Assessee, Mr. Pramod Patni a Sr. Partner in the CA Firm M/s Shah Patni & Co. while leaving for the hearing in Appeal at around 10.30 am or so received a Phone call which informed him of Demise of his Father in law, Dr. S.K. Jain, residing at Jaipur and was then admitted in a Hospital in immediate vicinity of AR's office. Due to which news, Pramod Patni left t....
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....18 pm with which filed.... 1. Application requesting adjournment of hearing dt. 17/10/2018* 2. Power of Attorney in favour of AR Firm and its partners/ Associates. *acceptance of which was refused on 17.10.20 for want of POA & Appeal Folder not being readily available 2.17. Though vide the first 2 emails, above dt. 17th & 18th October, the Jr. Partner Mr. Kailash Thathera, submitted the required documents, he missed on sending the said " Adjournment Application" dt. 17.10.2018, which his Sr. Partner had asked him to submit. Hence when Mr. Pramod Patni resumed office after the mourning period as well as an intermitted office holiday, when he enquired of such Adjournment Application having been filed and if not reasons for same, the Jr. partner realized his mistake and finally filed the same with the 3rd E.mail dt. 22.10.18. 2.18. However, surprisingly the Assessee Co. received by Post on 16.11.18 the Order in Appeal by the CIT(A), Ajmer, dt. 17th Oct.,2018 and on reading of which observed the following: i. The Order in Appeal passed in the date of 17.10.2018 itself, while the POA favoring the sender of email and submissions itself sent on 18.10.2018. ii. The Conclusion....
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....ication Application with all Attachments relied on by e. mail by the AR, on 16.11.2018 itself. c. The above Rectification Application with all Supporting Documents relied upon, further sent by the CA office by Regd. Post to CIT(A)- Ajmer as per Copy of Regd. AD Receipt dt. 17th Nov.,2019 attached. 2.21 Here attention is also drawn to yet another Notice dt. 14.11.18 for Hearing in Appeal on 22.11.18 for the same Year as A/s Yr. 2009-10 in the case of the above Assessee company under reference of Appeal No. E-308/2016-17 received, which too was carried by the AR to meet the Learned CIT(A)- Ajmer on 14.11.18 itself along with the Copy of the Order in Appeal dt. 17.10.18 which was received vide Email from CIT(A)_Jaipur dt. 09.11.2018. Attention to this fresh Notice, even after having passed Order in Appeal was shown to CIT(A)- Ajmer, Mr. Anil Singh, who even then showing dismay towards the working of his office, assured that since he having agreed to the company filing a Rectification Application for carrying out necessary amends, if required, in the Appeal Order, necessary justice would be done in the case. 2.22 In view of all the aforesaid developments in the case, the AR of ....
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....ter No. 1223 dated 15.11.2016 has informed the AO that the value of property has been revised after on-spot verification and value of the property has been enhanced from Rs. 76,00,000/- to Rs. 90,19,200/- and after hearing the assessee and giving the reasonable opportunity, the Assessing Officer has invoked the provisions of section 50C of the Act by taking the value of Rs. 90,19,200/- for the purposes of computing long term capital gains. It was accordingly submitted that there is no infirmity in the said order passed by the Assessing Officer and confirmed by the ld. CIT(A) and the order so passed by the CIT(A) may therefore be confirmed. 7. We have heard the rival contentions and perused the material available on record. It is a settled legal proposition that reassessment proceedings can be initiated basis the information and material in possession of the Assessing officer and where on review and examination thereof, where he forms a reasonable belief that the income has escaped assessment and pursuant thereto, he records his reasons for reopening the assessment, seek appropriate approvals from the competent authority and thereafter, issue notice u/s 148 of the Act. In the insta....
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....nation of long term capital gains. 10. In his submissions, the ld AR has stated that the sub-registrar has referred to revaluation of property and reference of which was made to superior authority vide letter dated 21.01.2009 and it was submitted that there was no notice for revaluation to either the purchaser or the seller of the property, no order for such revaluation is made till date or available on record and even no stamp duty has been demanded and/or paid by either of the parties. It was further submitted that regarding so called reference to superior authority vide letter dated 21.01.2009, the assessee through its Advocate inspected the records of the stamps duty authority and basis such examination, the advocate has issued a confirmation certificate that there was no such reference or revision in the valuation of the property after its registration on the records of the stamp duty authority. It has been further submitted that Deputy Director of Stamps vide reply dated 5.02.2018 in response to RTI application dated 11.12.2017 has also confirmed that no such reference from Sub-Registrar 4 Jaipur vide letter no. 57 dated 21.01.2009 was received by the said office and no such....