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COMMISSIONER OF INCOME TAX-III BANGALORE AND INCOME TAX OFFICER, CHIKMAGALUR Versus M/s DODDANANDI ESTATE

2015 (10) TMI 257 - KARNATAKA HIGH COURT

Capital gains in respect of sale of trees only - ITAT remanded the matter to the Assessing Officer to recompute the capital gains by taking 70% of the sale proceeds as market value of the land as on 1-4-1981 - Held that:- The Tribunal has accepted the case of the assessee and has arrived at the cost as claimed at 70% relying on certain earlier decisions of the Tribunal wherein, for valid reasons, 70% of the sale proceeds has been accepted.

In view of the aforesaid, we are of the opini .....

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The assessee had purchased a coffee estate in 1961 along with standing shade trees. The said estate was sold by the assessee in the year 1997. The Jungle wood and silver oak trees were sold for a sum of ₹ 1,00,00,000/- which was by way of an agreement dated 25-07-1995. The dispute in the present appeal is with regard to capital gains in respect of sale of trees only. The Assessing Officer assessed the same at 10% of the estimated value of the estate which was taken as ₹ 9,60,000/- a .....

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heard Sri.E.I.Sanmathi, learned counsel appearing for the appellants as well as Sri.S.P.Bhat along with Sri.C.Basavaiah, learned counsel appearing for the respondent-assessee and perused the records. 3. Learned counsel for the appellants has submitted that although, there are three questions framed in the memo of appeal, but the only question which requires consideration of this Court is first question, which is as under: "Whether the Tribunal is correct in law in directing the Assessing A .....

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questioned, Sri.E.I.Sanmathi, learned counsel for the appellants- Revenue could not point out from the order of the Assessing Officer, even a single reason for arriving at 10% instead of 70% as had been claimed by the assessee. The Appellate Commissioner has, on his own, recorded a finding that 10% of the estimated market value of the estate as on 1-4-1981 was arrived at by the Assessing Officer on the basis of some judgments of the High Court, which finding of the Appellate Commissioner is abso .....

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cisions of the Tribunal, more particularly in the case ofM/s.Sangameshwar Coffee Estate Limited V/S Income Tax Officer (ITA No.402/Bang/85) wherein, for valid reasons, 70% of the sale proceeds has been accepted. The said judgment in the case of Sangameshwar Coffee Estate (Supra) has been affirmed by this Court in Civil Petition No.302/1988 (Commissioner of Income Tax V/S M/s. Sangameshar Coffee Estate). 6. In view of the aforesaid, we are of the opinion that it cannot be said that the order of t .....

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Assessing Officer for fresh decision. We have gone through the said decision, wherein the matter was remanded to the Assessing Officer because initially the Tribunal had held the value of the timber at ₹ 35/- per cubic feet as on 1st April, 1981. But on a Miscellaneous petition filed by the assessee, the Tribunal allowed the claim of the assessee in toto and held that 70% of the sale proceeds be treated as cost of timber as on 1st April, 1981. In such facts and circumstances, where the Tr .....

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