Section 50C of the income tax Act, 1961 — Capital gains — Matter remanded to A.O. to decide the issue afresh in the light of the claim of the assessee for substituting the fair market value as on 1/4/1981 as the cost of acquisition and the assessee is directed to furnish necessary details in support of its claim and the A.O. to consider the claim of exemption as per the provisions of the law in light of the relevant CBDT Circular and after giving reasonable opportunity of being heard to the assessee.[2019] 51 ITCD 99 (GUJ)
Facts: Assessee filed the return of income on 31/3/2011 declaring total income of Rs. 2,21,510/-. The return was processed u/s. 143(1). Thereafter the case was selected for scrutiny assessment and notice under section 143(2) was issued. The assessment under section 143(3) was completed on 30/12/2011 assessing total income at Rs. 5,50,58,288/- and thus, the A.O. made addition of Rs. 5,48,36,783/- towards long term capital gain. The A.O. also initiated penalty proceeding under section 271(1)(c).The Assessment Order passed by the A.O. was challenged by the assessee by way of appeal before the CIT(A), Baroda and in appeal the appellate authority held that the seller had taken possession of the property and the documents of contract to transfer the property for the consideration of immovable property was in writing and signed by the assessee and therefore, all the conditions of provisions of section 53A of the Transfer of Property Act read with section 2(47) stand fulfilled and the assessee has also received consideration and therefore, it is taxable as capital gain. However, it was held that the A.O. had invoked the provisions of section 50(c) which was not permissible on account of the fact that the sale deed was not executed. The A.O. adopted fair price value as per the information available on the website of the property, instead of the rate assessable by stamp duty officer. The A.O. not allowed deduction of brokerage and other expenses. The A.O. has also not applied provisions of section 55(2) (b)for fair market value as on 1/4/1981, which is required to be adopted, as the cost of acquisition of the property. The CIT(A) further observed that the A.O. has erred in initiating penalty proceedings u/s. 271(1)(c). Consequently, the CIT(A) partly allowed the appeal and disallowed the claim of the appellant u/s 54EC and assessment was enhanced. Against the aforesaid order of the CIT(A), both the assesses and the revenue approached the Income Tax Appellate Tribunal, Ahmedabad D-Bench, Ahmedabad by way of filing separate ITAs and the tribunal allowed both the appeals for statistical purpose. Being aggrieved, revenue went on appeal before High Court.
Held , that having heard the learned counsel for the respective parties and considering the material on record, we are of the considered opinion that no error has been committed by the tribunal in allowing the appeals and remanding the matters to the A.O. The tribunal has recorded reasons in para 7, 8 and 9 of the order, as reproduced hereinabove, for remanding the matters to the A.O. So far as the contention raised by the learned counsel for the respective assessee, as noted hereinaboave, is concerned, the same is rightly rejected by the tribunal by holding that the assessee has failed to demonstrate that he was unable to submit the evidence during the assessment proceedings or unable to take a ground before the A.O. on account of some reasonable cause. No such reasonable cost had been shown before the tribunal. The said evidence was rightly not considered by the A.O., Commissioner and the tribunal. The impugned orders passed by the tribunal in remanding the matter does not require any interference at the hands of this Court. In the result, no substantial question of law arise in both these appeals for consideration of this Court. Both the appeals are dismissed. Consequently, as held by the tribunal, now the A.O. to decide the issue afresh in the light of the claim of the assessee for substituting the fair market value as on 1/4/1981 as the cost of acquisition and the assessee is directed to furnish necessary details in support of its claim and the A.O. to consider the claim of exemption as per the provisions of the law in light of the relevant CBDT Circular and after giving reasonable opportunity of being heard to the assessee.