TMI Blog2020 (7) TMI 41X X X X Extracts X X X X X X X X Extracts X X X X ..... nt date for computing the terms of agreement between the parties. Hyderabad Bench of the Tribunal in bunch of matters with lead order of Sri. Mohd Imran Beg vs. ITO [ 2015 (12) TMI 987 - ITAT HYDERABAD] had laid down similar proposition of applying the SR rate on the date of agreement to sell and not on the date of sale deed if, there was gap between the two dates. Second proposition raised by the assessee that in case the difference between the sale value declared by the assessee and sale value adopted by the AO is less than 5%, then there is no merit in applying the 50C guidance value. It is a settled proposition of law that in case the difference between the value shown by the assessee and the valuation done by the Revenue authorities is less than 10%, where the value worked out by the Revenue authorities is estimated, then actual sale consideration is to be adopted for computing the income in the hands of the assessee. Such is the proposition laid down by the Hyderabad Bench of the Tribunal in ACIT vs. Smt. S. Suvarna Rekaha [ 2010 (10) TMI 1051 - ITAT HYDERABAD] and in M/s. Radhika Sales Corporation vs. ACIT [ 2018 (11) TMI 1788 - ITAT PUNE]. The objection of the l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (A) ought to have considered the fact that the assessing officer has reopened the assessment u/s.147 in the absence of new material . 4. The Ld.CIT (A) ought to have considered the fact that the assessing officer has erred by not issuing the reasons for believing that the income has escaped assessment. 5. The Ld.CIT(A) ought to have considered the fact that the assessing officer has erred by not disposing the objection raised by the assessee by way of speaking order. 6. The Ld.CIT (A) ought to have appreciated the fact that the sales consideration received by the appellant for the sale of property is ₹ 45,00,000/ - only. 7. The Ld.CIT (A) ought to have appreciated the fact that the property in question has some inherent difficulties due to which it could not fetch the actual market price. 8. The Ld.CIT (A) erred in upholding the action of assessing officer in invoking the provisions of section 50C of the Act. 9. The Ld.CIT(A) ought to have appreciated the fact that the AO erred in not following the procedure laid down for invoking the provisions of section 50C of the Act. 10. The assessee may add, alter or modify any other point to the Grou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nds of appeal at any time before or at the time of hearing of the appeal . Grounds in ITA No. 1680/CHNY/2014 1. The order of the Ld. Commissioner of Income Tax (Appeals)-Central-I, Chennai (herein after referred to as CIT(A)) is erroneous both on facts and in law. 2. The Ld.CIT(A) ought to have appreciated the fact that the sales consideration received by the appellant for the sale of property is ₹ 16,30,42,400/-. 3. The Ld.CIT(A) ought to have appreciated the fact that the property in question has some inherent difficulties due to which it could not fetch the actual market price. 4. The Ld.CIT(A) erred in upholding the action of assessing officer in invoking the provisions of section 50C of the Act. 5. The Ld.CIT(A) ought to have appreciated the fact that the AO erred in not following the procedure laid down for invoking the provisions of section 50C of the Act. 6. The assessee may add, alter or modify any other point to the Grounds of appeal at any time before or at the time of hearing of the appeal . 8. The appeals for assessment years 2008-09 and 2009-10 are filed after delay of 68 days. The assessee has filed separate affidavits ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons of section 50C of the Act were to be applied. With regard to the next issue of indexation of cost of acquisition from 01.04.1981, wherein the AO allowed the same from financial year 2001-02, on the ground that the assessee had inherited the property in that year; the CIT(A) took note of provisions of section 49(1) of the Act and held that since the property was received by way of inheritance from the parents, the cost at which assessee s parents acquired property would be a cost in the hands of the assessee for the purposes of determining long term capital gains. Coming to the second aspect of indexed cost of acquisition, reference was made to the explanation (iii) under section 48 of the Act and it was held that the indexation had to be allowed from the date of incurring the expenditures by the said Previous Owner . Reliance was placed on the special Bench decision of Mumbai in Dy. CIT vs. Manjula J. Shah 2009 318 ITR (AT) 417 (Mum) (SB) and other decisions. The CIT(A) directed the AO to adopt the date on which the assessee (his parents) purchased the property i.e. 01.04.1981 both for adopting the cost of acquisition and as the date of acquisition, for the purpose of determin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aspect which he pointed out was that MOU was signed in 2002 and rates of land agreed to be sold were adopted at ₹ 2000/- per sq. ft; however the rates were revised thereafter and the AO has adopted revised rate of ₹ 2061 per sq. ft., as the GLR rate u/s 50C of the Act. In this regard, reliance was placed on various decisions but he emphasized on bunch of appeals with lead order in the case of Sri. Mohd Imran Beg vs. ITO in ITA No. 1942/Hyd/2014 relating to Assessment Year 2006-07, order dated 27.11.2015. He emphasized that when the agreement was entered into between the parties on anterior date, then the said date is to be taken for adopting the rate of land sold by the assessee. 18. The learned DR for the Revenue on the other hand relying on the orders of the authorities below, said that the provisions of section 50C of the Act are squarely applicable to the facts of the present case. He pointed out that the third proviso u/s 48 of the Act has been inserted on a later date and cannot be applied retrospectively. His case was that in case the assessee was aggrieved by the adoption of the rate of land than the course of action to be adopted u/s 50C of the Act was refer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ence between the declared value and 50C guidance value was about 2.6%, can the same be adopted for computing the income from long term capital gains. Similarly in the succeeding year i.e. 2009-10, the difference in the value shown by the assessee and 50C guidance value adopted by the AO, was 0.89%. The MOU between the parties as referred in the para above was entered on 20.09.2002 and the rate declared by the assessee as sale consideration was above 50C guidance value at the relevant time. The rates were revised in 2003, which difference in the value was adopted by the AO on the ground that Development agreement was entered into on 12.01.2004. In this regard, we have referred to SR rate as notified by the Tamil Nadu Government for Arcot Road, Saligramam, which initially was ₹ 1861/- per sq. ft. and was revised to ₹ 2061/- per sq. ft. The assessee had declared the sale value at around ₹ 2000/- per sq. ft. Once the assessee had entered into an agreement, the MOU, on 20.09.2002 then the rates as available on the date of actual transaction are to be adopted since, the assessee had received substantial amount on the date of entering into an agreement. Undoubtedly the d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the case. 2. The ld CIT(A) erred in holding that the cost of inflation index of the year of acquisition of the asset by the previous owner has to be applied and not the year of inheritance by the assessee as adopted by the Assessing Officer. 3. The ld CIT(A) failed to appreciate the fact that Explanation (iii) to Sec 48 only refers to the First year in which the asset was held by the assessee and does not use the word previous owner . If the intention of the legislature is to extend the benefit of indexation also, then Explanation (iii) to Sec 48 would have been worded appropriately. 4. The ld CIT(A) failed to place reliance on the following decision wherein it has been stated that where the provisions of the statute are plain and unambiguous, the same should be interpreted literally and strictly and nothing more should be read into such provisions: (i) CIT Vs. Smt. R.Bharathi (240 ITR 697 (Mad)) (ii) CIT Vs.N. Bhargavathy Ammal Another (240 ITR 451 (Mad)) (iii) CIT Vs.P. Manonmani (245 ITR 48 (Mad) (iv) Union of India Others vs. Dharmendra Textile Processors (306 ITR 277 SC)) 5. For these and other grounds that may adduced at the ti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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