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TMI Blog2017 (8) TMI 951X X X X Extracts X X X X X X X X Extracts X X X X ..... e is directed to produce all relevant evidences/ explanations before the AO as well before DVO to support its contentions, which shall be admitted by the AO/DVO in the interest of justice and adjudicated on merits in accordance with law. Needless to say that the AO/DVO shall provide sufficient and adequate opportunity of being heard to the assessee in accordance with principles of natural justice in accordance with law. - I.T.A. No. 5592/Mum/2016 - - - Dated:- 18-8-2017 - SHRI C.N. PRASAD, JUDICIAL MEMBER AND SHRI RAMIT KOCHAR, ACCOUNTANT MEMBER For The Assessee : Shri Paresah Shah,CA For The Revenue : Shri V. Vidhyadhar (DR) ORDER PER RAMIT KOCHAR, Accountant Member This appeal, filed by the assessee, being ITA No. 5592/Mum/2016, is directed against the appellate order dated 28.01.2016 passed by the learned Commissioner of Income Tax (Appeals)- 16, Mumbai (hereinafter called the CIT(A) ), for assessment year 2010-11, appellate proceedings before learned CIT(A) had arisen from the assessment order dated 29.01.2015 passed by the learned Assessing Officer (hereinafter called the AO ) u/s 147 r.w.s. 143((3) of the Income-tax Act, 1961 (hereinafter call ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e fault was on account of these erring professionals and the assessee was not at fault for this delay. It is also brought on record that ultimately the assessee dispensed with the services of these professionals and a new professionals have now taken over task of fulfilling and discharging the professional obligations of complying with audits and taxation matter. Thus, the assessee prayed for condonation of delay of 146 days in filing of this appeal with the tribunal beyond time stipulated u/s 253(3) of 1961 Act. The said three affidavits and large number of email communications running into 144 pages are placed on record in file.The assessee has also relied upon decision of Hon ble Supreme Court in the case of T. Ashok Pai v. CIT (2007) 292 ITR 11(SC) and also decision of Hon ble Bombay High Court in the case of Somany Evergreen Knits Limited in Appeal no. 1332 of 2011. Thus, in nutshell it is prayed that the assessee cannot be penalized for the fault of legal experts who were entrusted with professional assignments and on whom the assessee trusted and acted on their advise. On the other hand, Ld DR opposed the prayer of condonation of delay by the assessee and submitted that this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0,000/- with banking company 2 2009-10 AIR-007 1,44,40,147 Sold Immovable property valued ₹ 30,00,000/- or more 3 2009-10 TDS-94A 47,045 TDS return Interest other than Securities (Section 194A) 4 2009-10 TDS-94I 1,00,000 TDS Return Rent (Section 194I) TOTAL 1,95,87,192 The assessee was confronted with the above information by the AO vide letter dated 23-07-2013 and the assessee was asked by the AO to furnish return of income for the assessment year 2010-11 but the assessee did not responded to said notice. These information led to formation of belief by the AO that the income of the assessee has escaped assessment within the meaning of Section 147 of the 1961 Act. The AO issued statutory notice u/s 148 of the 1961 Act to the assessee after recording reasons and the notice u/s 148 of the 1961 Act was duly served on the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of ₹ 25,79,181/-. The A.O. observed that the assessee has sold the property for ₹ 1,30,56,550/-, whereas the ready reckoner rate of the said property as adopted by stamp duty valuation authorities of the State Government for the said property was ₹ 1,44,40,147/-. The A.O. while computing capital gains, adopted the ready reckoner value of ₹ 1,44,40,147/- as adopted by stamp duty valuation authorities of the State Government as full value of consideration (market rate of the property as referred by the AO ) as mandated u/s 50C of the 1961 Act ( as actual sale consideration was lower than ready reckoner rate) and computed the short term capital gain at ₹ 1,18,60,966/-, as against short term capital gain of ₹ 89,10,079/- offered for taxation by the assessee in return of income filed with the Revenue. The AO observed that the assessee has not brought any material on record to prove as to why the property was sold for a value less than prevailing market value of the property. The AO passed the assessment order dated 29-01-2015 u/s 143(3) r.w.s. 147 of the 1961 Act, wherein, inter-alia, above two additions were made to the total income of the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sales consideration. The assessee pleaded before learned CIT(A) that the matter concerning the valuation of property may be referred to DVO as mandated u/s 50C(2) of the 1961 Act as the authorities have adopted the stamp duty value which was higher than the fair market value of the property. It was pleaded before learned CIT(A) that stamp duty valuation authorities erred in determining ready reckoner rate as they adopted same rate for ground floor and basement which led to higher ready reckoner rate being adopted for stamp duty purposes. The learned CIT(A) rejected the request of the assessee to refer the matter of valuation of property to DVO as contemplated u/s 50C(2) of the 1961 Act because the assessee never requested the AO to refer the matter of valuation to DVO and such request at appellate stage for the first time cannot be allowed, vide appellate order dated 28.01.2016 passed by learned CIT(A). 7. Aggrieved by the appellate order dated 28.01.2016 passed by ld. CIT(A), the assessee is in appeal before the tribunal. 8. The ld. counsel for the assessee argued before us that the vouchers were filed before the ld. CIT(A) as an additional evidence to substantiate the repai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wance of repair and maintenance expenses. It was submitted that in any case the assessee was not carrying on any business since June/July 2007 and these expenses cannot be allowed. It was also submitted that the Revenue is not in appeal against the relief granted by the ld. CIT(A). The learned DR fairly stated that the matter w.r.t. adoption of full value of consideration of the property sold may be set aside and restored to the AO for making reference to DVO for computing fair market value of the property, as is contemplated u/s 50C(2) of the 1961 Act. 10. In the rejoinder, the ld. counsel submitted that the assessee had submitted vouchers before learned CIT(A) as an additional evidences to substantiate repair and maintenance expenses of ₹ 2,50,000/-, hence, the matter needs to be restored to the file of the A.O. for verification as learned CIT(A) did not followed Rule 46A of the 1962 Rules by not forwarding the same to the AO for his verification and examination of the additional evidences and submission of remand report. 11. We have considered rival contentions and also perused the material available on record. We have observed that the reassessment proceedings were ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ckoner rate as adopted by the stamp duty valuation authorities of the State Government as full value of the consideration of the property sold for computing capital gains as the ready reckoner rate of ₹ 1,44,40,147/- was higher than actual sale consideration of ₹ 1,30,56,550/- by invoking provisions of Section 50C of the 1961 Act. The assessee has disputed the ready reckoner rate as adopted by stamp duty valuation authorities of State Government because the said authorities adopted the same rate for basement and ground floor which led to higher ready reckoner rate. The assessee invoked provisions of Section 50C(2) of the 1961 Act for making reference to DVO but the said claim was made before learned CIT(A) for the first time which the learned CIT(A) rejected as the assessee did not raise the said claim before the AO. In our considered view claim of the assessee to make reference to DVO for determining fair market value of the property as contemplated u/s 50C(2) of the 1961 Act can be raised at an appellate stage as taxes are required to be computed in accordance with and authority of law. Section 50C(2) and 50C(3) of the 1961 Act clearly allows the reference to DVO if t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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