Chaitram Alonkar Vs ITO (ITAT Delhi)
ITAT Allows Full Cost of Acquisition as Land Conversion Reduced Saleable Area; Jurisdiction Challenge Rejected as Assessee Participated Without Timely Objection; Section 50C Addition Upheld Because Seized Cash Confirmed On-Money Receipt; ITAT Directs LTCG Recalculation After Finding Cost of Acquisition Wrongly Restricted.
The Income Tax Appellate Tribunal (ITAT), Delhi, considered an appeal arising from an assessment completed under Sections 143(3) read with 153A of the Income Tax Act for AY 2017-18. The assessee had filed a return in response to a notice under Section 142(1), declaring long-term capital gains (LTCG) from the sale of land. During assessment, the Assessing Officer (AO) recomputed the LTCG by adopting stamp duty valuation under Section 50C and made an addition towards differential capital gains. The AO also referred the matter for penalty proceedings under Section 271D for an alleged violation of Section 269SS.
Before the Tribunal, the assessee challenged the jurisdiction of the AO, the computation of cost of acquisition, the adoption of fair market value (FMV) under Section 50C, and the levy of interest under Sections 234A, 234B and 234C. The Tribunal admitted the jurisdictional grounds raised for the first time but rejected them on merits. It held that the assessee had participated in the proceedings without objecting to jurisdiction and that any challenge was barred by Section 124(3) of the Act. The Tribunal found that the AO had territorial jurisdiction and that the assessee could not question it after the prescribed time.
