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TMI Blog2022 (4) TMI 1376X X X X Extracts X X X X X X X X Extracts X X X X ..... TMI 563 - KARNATAKA HIGH COURT] and case of CIT vs. Rajesh Kumar Jalan,. [ 2006 (8) TMI 126 - GAUHATI HIGH COURT] . Accordingly, we are of the view that the assessee is entitled for claim of deduction of the investments made in purchase of residential house at Nanganallur for an amount of ₹ 4.41 crores and the AO will re-compute the deduction accordingly. Claim of indexed cost of acquisition - The assessee has made claim as regards to expenditure incurred towards refilling with soil and evacuation of earth work, costing ₹ 16.40 lakhs for the financial year 1994-95 and the indexed cost of which works out to ₹ 64,84,015/-. Further in financial year 2003-04, as per contractors bills, the assessee incurred expenditure towards fencing, gating, cement, concrete blocks, etc., to the extent of ₹ 19,00,000/- and the indexed cost of improvement works out to ₹ 42,02,160/-. Similarly, in financial year 2009-10, as per contractors bills, the assessee incurred expenditure towards clearing bushes, labour and material supplied which works out to ₹ 18,00,000/- and the indexed cost of improvement comes to ₹ 29,16,456/-, which the Revenue has not negate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ommissioner of Income Tax -14, Chennai in ITA No.100 88/CIT(A)-14/2017-18 dated 30.07.2018. The assessments was framed by the ITO, Non-Corporate Ward 13(3), Chennai for the assessment years 2015-16 u/s.143(3) of the Income Tax Act, 1961 (hereinafter the Act ) vide order dated 29.12.2016. In ITA No.2961 of 2018, the impugned order of the AO is passed u/s.154 of the Act, rejecting rectification u/s.154 of the Act vide order dated 06.02.2018 ITA 2960/CHNY/2018 2. The only issue in this appeal of Revenue is against the order of CIT(A) deleting the addition made by the AO on account of long term capital gains to the extent of ₹ 7,36,02,980/- 3. Briefly stated facts are that the assessee has claimed deduction u/s.54 of the Act for an amount of ₹ 6,97,60,030/-on long term capital gain of ₹ 6,89,39,241/-. The AO noted in his assessment order that as per information from AIR, the assessee has sold an immovable property (vacant land) at NSN Garden, 50 Feet Road, Voltas Colony, Nanganallur, Chennai 600 061, admeasuring 16400 sq.ft., comprised in survey No.57/1(part), 59/1.59/2 and 58/3B (part) assigned Town Survey No.85/1, Block No.16 situated at Thalakancher ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding) in his name and 3 residential houses in the name of his wife out of the sale proceeds. All the properties are assessed as separate residential /commercial units by the Municipality Authorities. Hence, the assessee failed to satisfy the conditions in Proviso (a)(ii) (iii) to section 54F(1) of the Income Tax Act, 1961. 3.1 As regards to adoption of cost of acquisition as on 01.04.1981, the assessee claimed the indexed cost of acquisition at ₹ 48,60,759/- and the AO after taking report from the Sub- Registrar, Alandur and SRO of Thalakkanchery Village, S.Nos.58/3B, 59/1 and 59/2 as on 01.04.1981, the guideline value was given at ₹ 20,000/- per acre and for S.Nos.57/1 was estimated at ₹ 20,000/- per ground as per his records. Accordingly, the AO adopted the cost of land as on 01.04.1981 at ₹ 1,36,800/- thereby the AO computed the indexed cost of acquisition on the date of sale at ₹ 1,97,020/-. The AO added the long term capital gain at ₹ 7,36,02,980/- and assessed the income accordingly. Aggrieved, assessee preferred appeal before CIT(A). 4. The CIT(A) after considering the submissions of the assessee and the issue dealt by the AO in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee has incurred certain expenditure in financial year 2003-04 towards fencing, gating, cement, concrete block, etc., to the extent of ₹ 19,00,000/- and the indexed cost comes to ₹ 42,02,160/-. Similarly, as per contractor s bills, the assessee has incurred certain expenditure towards clearing bushes, labour and material supplied in financial year 2009-10, which works out to ₹ 18,00,000/- and the indexed cost of the same works out to ₹ 29,16,456/-. Apart from the above, the assessee also submitted that he has gifted certain portion of land to Municipal Commissioner through a release deed in financial year 1994-95 and the cost of the land as per Municipal records is ₹ 13,31,580/-. The CIT(A) treaded this as indexed cost of acquisition and worked out the same at ₹ 52,64,623/-. The Revenue now before us has challenged the adoption of cost of improvement as well as land gifted to Municipal Commissioner i.e., certain portion of land through release deed, the same cannot be considered as cost of improvement. The Revenue also challenged the value adopted by CIT(A) on the basis of Registered Valuer s Report as on 01.04.1981 at ₹ 20,99,200/- p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... claimed that purchase of residential house at Nanganallur was claimed as deduction u/s.54F of the Act. The assessee has invested this amount in purchase of residential house and he has not made any other claim of deduction u/s.54F of the Act. Admittedly, the assessee reinvested in the new asset within the due date of filing of return u/s.139(4) of the Act and not u/s.139(1) of the Act. It is also admitted position that there was only a delay of 9 days for registration of new asset due to certain compelling reasons as there were defects in the power of attorney and due to that the assessee has to re-register the power of attorney and accordingly, the sale deed has to be executed. Finally, the assessee registered the sale deed of this residential house on 12.09.2015 whereas the due date for filing of return u/s.139(1) was 07.09.2015, as noted by the AO in his order. Practically there was delay of some days. We noted that this issue has been considered by Hon ble Karnataka High Court in the case of Fathima Bi vs. ITO, ITA No.435 of 2004, dated 17.10.2008 and Hon ble Gauhati High Court in the case of CIT vs. Rajesh Kumar Jalan, (2006) 286 ITR 274. Accordingly, we are of the view that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... consideration of ₹ 2 crores while computing long term capital gain as there is no evidence to support the claim of assessee. For this Revenue has raised various grounds, which are argumentative and need not be reproduced. 9. Briefly stated facts are that the relevant assessment year is 2015-16 and the assessment was framed by the AO vide order dated 29.12.2017 u/s. 143(3) of the Act. The assessee after completion of assessment and even after filing of appeal before CIT(A) i.e., during appellate proceedings before CIT(A) against the assessment order passed u/s.143(3) of the Act, moved rectification application dated 27.01.2018, whereby the assessee claimed that he has received a sum of ₹ 2 crores in cash i.e., additional sale consideration. The AO rejected the application vide order dated 06.02.2018 by observing as under:- On going through your application for rectification u/s 154 of the IT Act, of the assessment order passed for the A.Y. 2015-16, as your case does not deserve any merits to rectify u/s 154, your application dated 28.01.2018 is hereby rejected. 10. Aggrieved assessee preferred appeal before CIT(A). The CIT(A) admitted the claim of assessee simpl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... I may also be allowed necessary reliefs allowed under the Act. 5. While going through the order of assessment for the above year, I noticed the following errors which had crept in. I humbly request you to correct the same. 11.1 The ld.Senior DR in view of the above, stated that the assessee want to claim deduction of long term capital gain on higher amount and pay lower rate of tax and accordingly he made this plea of additional sale consideration received. The ld.DR stated that the assessee has not given even the dates of deposits made in the bank account and even otherwise on jurisdiction also this is highly debatable issue, this cannot be considered while adjudicating the issue u/s.154 of the Act. He stated that u/s.154 of the Act, the scope is very limited that mistake happened from record can be rectified and not the additional claim of additional sale consideration of ₹ 2 crores received in cash and whether the same is additional sale consideration or unaccounted income of the assessee. In term of this, the ld.senior DR, asked the Bench to straightaway dismiss the appeal of assessee. 12. On the other hand, the ld.counsel for the assessee could not controvert th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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