9911796707
TMI Blog2010 (4) TMI 765X X X X Extracts X X X X X X X X Extracts X X X X ..... four partners namely, S/Shri Subhash Chandra, Jitendra Kumar, Pradeep Kumar and Anil Kumar. The firm derives income from running of a cold storage. The assessee during the year sold the cold storage unit in the month of December, 2002 and January, 2003. This cold storage unit was set up in the year 1969. The sale deed was executed on 10th Jan., 2003 for the sale of building and land of the cold storage. As per the sale deed, for the purpose of stamp duty the sale value of land was taken at Rs. 13,88,669 while for the building at Rs. 1,03,63,331. The assessee has shown the long-term capital gain at Rs. 1,45,199 in the following manner : Salevalue of land as per sale deed on which stamp duty has been paid Rs. 13,86,669 Less : Indexed cost Rs. 12,41.470 Value as on 1-4-1981 @ Rs. 20 per sq. mtr. 2.77,733 x 447 = 12,41,470 Gain Rs. 1.45.199 100" 4. The AO called the assessee to justify the computation of the capital gain. The AO also deputed the Inspector, for ascertaining fair market value of the land as on 1st April, 1981, to the office of Sub-Registrar, Farrukhabad. The Inspector worked out the indexed fair market value of the land ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... per sq. mtr. The assessee has estimated the value keeping in view the actual use of the land with the commercial one. The AO, deputed the Inspector to contact the Sub-Registrar, Farrukhabad. The Inspector has collected the rates for the agricultural land per acre and on the basis of the agricultural land per square metre rates were worked out and the same has been adopted in the case of the assessee. No comparative instance for the purchase and sale of the commercial land was brought on record. This is a fact on record that the land which was sold by the assessee is being used for factory purposes and not for agricultural purposes. Therefore, the rate of agricultural land cannot be applied. Even otherwise it was pointed out that there is a huge difference in the land rates used for commercial purposes and used for agricultural purposes. Five times difference in the case of the assessee is much more reasonable. It was also contended that if the assessee has adopted a particular rate, the onus is on the AO to place on record the rate of commercial land which can be regarded to be comparable with the land of the assessee. The agricultural land cannot be compared with the commercial la ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... office of the Sub-Registrar for ascertaining the prevailing fair market value of the land as on 1st April, 1981. This is apparent from the record that the Inspector has brought out the rate of the agricultural land and not of the commercial land. The land rates as has been brought on record for agricultural land were per acre and has been worked out per square metre and applied for ascertaining the fair market value of the land of the assessee as on 1st April. 1981. The land rate prevailing for the agricultural land cannot be the basis for ascertaining the fair market value of the land of the assessee as on 1st April, 1981. A comparable instance has to be of similar nature of the land, similar to the time of the transaction, similar to the size of the land. The instance taken by the AO although is relevant to the time but is not relevant to the nature of the land and the size of the land as has been sold by the assessee. This is a settled law that appeal is real. The onus is on the person who alleges apparent is not real. The assessee has obtained the fair market value of the land as on 1st April, 1981 @ Rs. 20 per sq. mtr. If the AO did not agree with the land rate as estimated b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... utta while the transaction statement contents the name of Jitendra Kumar, 172/55, Civil Lines, Old Wimco Vila, Bareilly. While the assessee firm is situated at Jahanganj, Farrukhabad. In view of the above facts and figures it is become obvious that assessee has done speculation business in shares and therefore, the loss sustained in share trading is speculation loss which is to be allowed from speculation profit. The loss deducted from the short-term capital gain is disallowed and added to the income of the assessee." 11. When the matter went before the CIT(A), the CIT(A) confirmed the finding of the AO. The matter travelled to the Tribunal. The learned JM took the view that the assessee has suffered loss of Rs. 41,27,145 as short-term capital gain (sic-loss). lie was of the view that the provisions of s. 43(5) are not applicable as there had been actual delivery in the case of the assessee. The assessee had a demat account in the name of the partner Shri Jitendra Kumar which was permissible as per Circular No. NSDL/Policy/2006/0008, dt. 4th March, 2006. The copy of contract note and the relevant bill as well as copy of the assessee's account in the ledger of broker M/s P.K. Agarw ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y dealing the issue relating to the genuineness of the transaction. He has restored the issue to the file of the CIT(A) for ascertaining the genuineness of the transaction. Referring to p. 6 of the paper book it was pointed out that this page contains transaction statement for the purchase and sale of the shares entered into by the assessee through its partner Shri Jitendra Kumar. Referring to pp. 7 to 14 of the paper book it was pointed out that these pages contain the contract note issued by P.K. Agarwal & Co. through which the assessee has purchased and sold the shares. Referring to paper book-II, p. 14, it was pointed out that as per the circular issued by National Securities Depository Ltd., in case of a partnership firm, the demat account has to be opened in the name of the partner and accordingly the assessee firm has the demat account in the name of the partner Shri Jitendra Kumar. The delivery of the shares has come in the demat account and the delivery of the shares when sold were given out of the demat account. Attention was drawn to the copy of the account of the assessee in the books of P.K. Agarwal & Co. appearing at p. 11 and pointed out that the purchase and sale of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion, after giving both the parties opportunity of being heard, to pass such order on the grounds of appeal thereon as it thinks fit. This provision does not empower the Tribunal to go beyond the ground of appeal or the issue before it. Since the AO has not doubted the genuineness of the transaction, we cannot restore this issue to the file of the CIT(A) for looking into the genuineness of the transaction. Restoring the issue to the file of the CIT(A) for ascertaining the genuineness of the transaction, in my opinion, is not within the jurisdiction of this Tribunal as it will not emanate from the ground of appeal and the same were not before us. I, therefore, do not agree with the order of the learned AM. On the basis of the evidence as has been brought on record and as has been referred to before me, it is apparent that it is not a case where the provisions of s. 43(5) can be applied. The transaction for the purchase and sale of the shares has been settled through delivery of the shares through the demat account of the assessee in the name of the partner of the assessee one Shri Jitendra Kumar. The contention raised by the learned Authorised Representative has been dealt with by th ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
