Kalabhai Karshanbhai Patel Vs ITO (ITAT Ahmedabad)
Ahmedabad Tribunal condoned a delay of 1890 days in filing appeal & directed AO to recompute capital gains by adopting DVO’s valuation & indexed cost of acquisition, keeping in view that Assessee was only a co-owner of the property.
Assessee, being co-owner, was subjected to addition of ₹40,88,000/- u/s 50C on account of difference between sale consideration & stamp duty valuation. AO made the entire addition in the hands of Assessee without recognizing proportionate co-ownership & without granting benefit of indexed cost of acquisition. CIT(A) partly allowed appeal by directing adoption of DVO’s valuation in the case of another co-owner but the addition was effectively confirmed in the hands of Assessee.
When the matter reached Tribunal, Assessee explained that delay of 1890 days occurred as the Chartered Accountant failed to communicate the appellate order of CIT(A). The delay was held to be bonafide, without negligence or malafide intent, & Tribunal condoned the same.
On merits, Tribunal noted that AO had erred in taxing the entire addition in the hands of Assessee ignoring his co-owner status & without considering indexed cost. Tribunal directed AO to recompute capital gains afresh by adopting DVO’s value as applied in the co-owner’s case & by allowing indexed cost of acquisition. AO was further directed to give proper opportunity of hearing to Assessee. Accordingly, the appeal was allowed for statistical purposes with matter remitted back to AO for fresh adjudication.
