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TMI Blog2014 (4) TMI 391X X X X Extracts X X X X X X X X Extracts X X X X ..... d copies of the sale deeds in case of two comparable instances of sale of land in the same survey number at Rs.6/- per sq. yard - the CIT has refused to take cognizance of them on a flimsy ground that the assessee has failed to produce the original sale deeds – the reasoning of the CIT is not at all acceptable - When the assessee is producing certified copies of the sale deeds, the CIT is bound to accept them and cannot insist upon the assessee to produce the original sale deeds which is an impossible act to do - the CIT cannot determine the cost of acquisition solely relying upon the SRO rate – Decided in favour of Assessee. Payment of brokerage – Held that:- CIT was not justified in holding the assessment order to be erroneous and prejudicial to the interests of Revenue – the AO has not only applied his mind but has also made necessary enquiry while bringing the capital gains to tax - The CIT(A) has dealt in detail with the various issues relating to capital gain in course of disposal of the appeal preferred by the assessee and has ultimately passed an exhaustive order wherein he has considered all the aspects relating not only to the computation of capital gain but also with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... belonged to late Abdul Basith Khan who had two sons and three daughters. After the death of Sri Abdul Basith Khan some time in the year 1947, his eldest son Mr. Abdul Baquer Khan sold the entire land to one Mr. Ram Gnaneswar and 4 others in the year 1963. They in turn, sold the land to M/s. Matrusree Cooperative House Building Society in the year 1979. The society also allotted the land to its members. The other family members having become aware of the sale of land by Mr. Abdul Baquer Khan, filed cases before the Civil Court claiming their share in the joint family land. The 1st Additional District Judge, Ranga Reddy passed a preliminary decree on 29.12.2000 in O.S.No.38 of 1993 and confirmed the shares of the assessee along with 13 others to the extent of 12/28 portion of the land. The Assessing Officer further noticed that the land in question has already been sold to M/s. Matrusree Cooperative House Building Society and who in turn, has allotted it to their members who were in possession over the property. For settling the dispute with the members of the Matrusree Cooperative House Building Society and to dispose of their shares in the plots, the assessee along with other fami ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent order passed should not be set aside being erroneous and prejudicial to the interests of Revenue. In response to the show cause notice issued by the CIT, the assessee appeared before the CIT and made his submissions objecting to the conclusion drawn by the CIT that the assessment order is erroneous and prejudicial to the interests of Revenue. It was contended by the assessee that as per the preliminary decree passed by the 1st Additional District Judge, Ranga Reddy District dated 29.12.2000, the assessee is entitled to only 1/9th share of the property as against 1/6th assessed by the Assessing Officer. Therefore, it cannot be said that the assessment order is erroneous and prejudicial to the interests of Revenue. The CIT, however, did not accept the contention of the assessee. The CIT was of the view that the entire calculation of long term capital gain was done by the Assessing Officer on the basis of the shares determined in the preliminary decree dated 29.12.2000 passed by the 1st Additional District Judge in O.S.No.38/93 which was suspended by the High Court of Andhra Pradesh in order dated 13.04.2001. He, therefore, held that as the order of the Additional District Judge h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent order so passed directed the Assessing Officer to re-do the same as per the directions contained in the order passed under sec. 263 of the Act. Being aggrieved by the order passed by the CIT, the assessee is in appeal before us. 3. The learned A.R. submitted that the exercise of jurisdiction under section 263 of the Act is totally untenable as the Assessing Officer has completed the assessment after considering all the aspects, not only with proper application of mind but also by conducting necessary enquiry. Therefore, the order passed by the Assessing Officer cannot be held to be erroneous or prejudicial to the interests of Revenue. The learned A.R. submitted that so far as the direction of the CIT to assess 1/3rd share at the hands of the assessee is concerned, such direction is totally irrelevant and contrary to the materials on record. It was submitted that the preliminary decree passed by the Civil Court in the meanwhile has been confirmed by the Hon ble High Court of Andhra Pradesh. Therefore, the reasoning of the CIT that, 1/6th share determined by the Assessing Officer on the basis of preliminary decree passed by the 1st Additional District Judge, Ranga Reddy Distri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o these issues. The CIT was justified in revising the assessment order under section 263 of the act. 5. We have heard the submissions of the parties and perused the orders passed by the Revenue authorities as well as other materials on record. As is apparent from the notice issued under section 263 of the Act as well as the revision order passed by the CIT, he has held the assessment order passed under section 143(3) read with section 147 of the Act, to be erroneous and prejudicial to the interests of Revenue due to the following three reasons : (i) The Assessing Officer has taken 1/6th share in the property solely relying on the preliminary decree passed by the 1st Additional District Judge, Ranga Reddy District which has been stayed by the Hon ble High Court of Andhra Pradesh. (ii) The cost of acquisition as on 01.04.1981 has been erroneously adopted at Rs.2/- per sq. yard instead of Rs.2/ per acre. (iii) Brokerage claimed has been allowed without any supporting evidence. 5.1. As can be seen from the facts and materials on record, the Additional District Judge, Ranga Reddy District has passed a preliminary decree on 29.12.2000 in OS.No.38 of 1993 partitioning the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o produce the original sale deeds. Such reasoning of the CIT in our view, is not at all acceptable. When the assessee is producing certified copies of the sale deeds, the CIT is bound to accept them and cannot insist upon the assessee to produce the original sale deeds which is an impossible act to do. Similarly, the CIT cannot determine the cost of acquisition solely relying upon the SRO rate as time and again it has been held by different Benches of the Tribunal as well as the jurisdictional High Court that SRO rate cannot be considered to be reflecting the fair market value. 7. Similarly, so far as the payment of brokerage is concerned, in our view the CIT was not justified in holding the assessment order to be erroneous and prejudicial to the interests of Revenue since the assessee has produced the necessary evidences in support of the brokerage claimed and the Assessing Officer has passed the order after applying his mind to the materials available on record as well as conducting necessary enquiry. A perusal of the assessment order clearly reveals the fact that the Assessing Officer has not only applied his mind but has also made necessary enquiry while bringing the capital ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the possession to be retained in pursuance of a contract or allowing the enjoyment of the immovable property would also amounts to a transfer. We find that in respect of the very same property, in the case of other co-owners in ITA Nos. 1220 to 1236/Hyd/09, the Tribunal considered the year of assessability and remitted the matter to the file of the CIT(A) for consideration. Therefore, for the sake of consistency, we remit the issue of year of assessability to the file of the CIT(A). The CIT(A) shall decide the issue in accordance with law after giving reasonable opportunity to the assessee. 7.1. On a plain reading of the finding of the Tribunal extracted hereinabove, it becomes clear that except the year of assessability the other aspects of computation of capital gain has attained finality. That being the case, the assessment order on the issue of capital gain having merged with the order passed by the CIT(A) and ITAT, will not be amenable to revisionary proceeding under section 263 of the Act in view of the specific bar contained under section 263(1) Explanation (c). Therefore, considered in the aforesaid perspective the exercise of jurisdiction under section 263 of the Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X
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