IN THE ITAT CHANDIGARH BENCH ‘B’
Manjit Singh
versus
Deputy Commissioner of Income-tax
IT APPEAL NO. 1037 (CHD.) OF 2011
[ASSESSMENT YEAR 2008-09]
SEPTEMBER 28, 2012
ORDER
Mehar Singh, Accountant Member
The present appeal filed by the assessee is directed against the order dated 07.09.2011 passed by the ld. CIT(A) u/s 250(6) of the Income-tax Act,1961 (in short ‘the Act’).
2. In this appeal, the assessee has raised the following Grounds of Appeal:
‘1. That the ld. CIT(A)-I, Ludhiana has erred in confirming the addition made by the Assessing Officer under the head long term capital gain by adopting the fair market value of land as on 1.4.1981 at Rs. 27,030/- per acre against Rs. 5 lacs per acre adopted by the assessee.
2. That the ld. CIT(A)-I, Ludhina has jailed to ignore the documentary evidence in the shape of certificate from the Patwari as well as Tehsilder which was based on field enquiries by the Partwari and rejection of that report of the Tehsildar/Patwari by the CIT(A) was not proper.
3. That the CIT(A) has erred in not considering the reply filed by the Tehsildar who had responded to enquiries made by the Assessing Officer u/s 133(6) and gave the Fair Market Value of the land as on 1.4.1981 after making detailed enquiries from the various prominent person viz Nambardars/Sarpanchs who confirmed the market rate of Rs. 5 lacs per acre.
4. That the CIT(A) has failed to appreciate that fair market value of land and registry value are different as in the case of assessee himself the sale was made for Rs. 43,25,000/- per acre and circle rate was Rs. 5 lacs per acre and, thus, if fair market value has been declared at Rs.43,25,000/- per acre then the same basis should have been adopted as cost of acquisition as on 1.4.1981, based on fair market value. Titus, the contradictory stand have been confirmed by the CIT(A) against the facts and circumstances of the case.
5. Notwithstanding the above ground of appeal the Assessing Officer having already accepted fair market value of the land in the same area @ Rs. 1.80,000/- per acre, which was located deep inside the Village having odd shape and other defects, and the land sold under consideration being situated on the main road having better location, size and shape, the rate should have adopted for higher than the Rs. 1,80, 000/- per acre as accepted by the Assessing Officer u/s 143(3) of the Act for the Assessment Year 2005-2006.
6. The CIT(A) has not been able to rebut the identical case of Shri Abdul Rashid Rather of Amritsar Bench as cited before him and under detailed submissions as made before him.
7. That the Appellant craves leave to add or amend he grounds of appeal before the appeal is finally heard or disposed off.”
3. In the course of present appellate proceedings, before the Bench, ld. ‘AR’ contended that the grounds of appeal revolve around non-adoption of circle rate of Rs. 5 lacs per acre as Fair Market Value as on 01.04.1981, for the purpose of computation of capital gains by the AO and upholding the findings of the AO by CIT(A). Ld. ‘AR’ referred to various pages of the Paper Book, such as pages from 50 to 62, 39. Ld. ‘AR’ also placed reliance on the decision of the Amritsar Bench in the case of Abdul Rashid v. ITO in IT Appeal No. 104/ASR/2009, A.Y. 2004-05 dated 23.7.2009. Ld. ‘AR’ also placed reliance on the decision of the Chandigarh Bench in Dy. CIT v Smt.Baljindcr Kaur [2009] 29 SOT 8 (CHD) (URO). Ld. ‘AR’ also filed written submissions in the form of synopsis. A bare perusal of the synopsis reveals that assessee appellant is aggrieved by the order passed by the AO and upheld by the CIT(A) in adopting Fair Market Value of the asset as on 1.4.1981 at Rs. 27,030/- per acre. Ld. ‘AR’ contended that CIT(A) accepted the rate of Rs. 43.25 lacs per acre as sale rate, as disclosed on the basis of one agreement in respect of land, seized from the premises of Shri G.K. Colonizer against circle rate of Rs. 5 lacs, but ignored the adoption of Rs. 5 lacs as Fair Market Value of the same land as on 1.4.1981. The appellant has adopted Fair Market Value of the land as on 1.4.1981 on the basis of certificate of Halka Patwari, as endorsed by the Tehsildar, issued on the basis of enquiries conducted from the field staff, various Sarpanches and Panchayat members, with their signature appended thereon. Ld. ‘AR’ further pointed out that the Fair Market Value of the land vis-a-vis sale consideration as recorded in Registered Sale Deed cannot be the same. Relevant part of the brief synopsis is reproduced hereunder :
“2.The facts in brief are that the assessee is an agriculturist and had sold some land to G.K. Colonizers and during the course of search on G.K. Group of cases, one agreement was seized from where, it came to the notice of the department that the assessee had sold agricultural land at the rate of Rs. 43.25 lacs per acre, against the circle rate of Rs. 5 lacs per acre and the assessee accepted that rate of sale as per agreement and filed the return of income and adopted the sale rate as per agreement.
3. For the justification of land rate as on 1.4.1981, the assessee filed the certificate from the Revenue Officer, wherein he had certified the “Fair Market Value of the land at Rs. 5 lacs per acre as on 1.4.1981 and the evidence of the same had been enclosed in the paper book at page 11.
4. Not satisfied with that certificate, the AO made enquiries from the Tehsildar for ‘fair market value.’ of land as on 1.4.1981and that letter has been reproduced by the Assessing Officer in the assessment order. The Tehsildar made detailed enquiries from the Nambardar, Patwari, Sarpanches of Villages and gave a exhaustive report as per copy placed at pages 12 to 17 of the paper book. The report is very exhaustive.”
4. Ld. ‘AR’ pointed out that the C1T(A), cannot adopt contradictory approach, in the adoption of the Fair Market Value of the land, as on 1.4.1981, ignoring the sale consideration of Rs. 43.25 lacs per acre, of the said land, disclosed by the assessee, as recorded in the Agreement, seized in the course of search operation, as full value of consideration u/s 48 of the Act. It was, further, pointed out by the ld. ‘AR’ that the department has already accepted Rs. 1,80,000/- per acre as Fair Market Value of the land as on 1.4.1981 located in the same village and at an adverse location for the assessment year 2005-06. Ld. ‘AR’ also analyzed the finding of the CIT(A) in the written synopsis and the same are reproduced as under:
