COMMISSIONER OF INCOME TAX Vs. DELHI HOUSING

JUDGEMENT

(1.) This appeal by the revenue is directed against the order dated 25.05.2012 passed by the Income Tax Appellate Tribunal (hereinafter referred to as "Tribunal") in ITA No.4917/Del/2010 pertaining to the assessment year 2003-04. The only issue that was before the Tribunal was with regard to the correct valuation of two plots sold by the respondent/ assessee during the financial year ending 31.03.2003 which was relevant to the assessment year 2003-04. One plot was of Radhey Shyam Park and another of Rajinder Nagar Industrial Area. The impugned order passed by the Tribunal was the second round of litigation before the Tribunal. In the first round the Tribunal had passed an order on 28.11.2008 whereby it had noticed that the assessing officer while estimating the rate of the plots had taken a rate relying upon an Inspector's report with which the respondent had not been confronted. Consequently, the Tribunal had directed that the matter be restored to the file of the assessing officer to decide the same afresh after supplying the Inspector's report to the respondent/ assessee and also after allowing an opportunity to the assessee to cross-examine the Inspector. The assessing officer was directed to estimate the sale rates of the said plots after considering the entire material and the surrounding circumstances in accordance with law.

(2.) Pursuant to the directions given by the Tribunal in the first round, the assessing officer supplied a copy of the Inspector's report to the assessee and also produced the Inspector for cross-examination by the assessee. However, despite the said cross-examination the assessing officer maintained that the assessee had suppressed the sale prices and did not accept the explanation offered by the assessee. The assessing officer once again adopted Rs. 6,000/- per sq. yd. as the rate for computing the value of the plots at Radhey Shyam Park and Rajinder Nagar Industrial Area. As such the assessing officer confirmed his earlier determination of Rs. 31,21,980/- in respect of land at Radhey Shyam Park and Rs. 23,93,000/- in respect of land at Rajinder Nagar Industrial Area. The assessee preferred an appeal before the Commissioner of Income Tax (Appeals). The CIT (Appeals) held that the assessee was not justified in applying the rate of Rs. 1,000/- sq. yd. and held that Rs. 2,500/- per sq. yd. should be adopted for the land at Rajinder Nagar Industrial Area and Rs. 2,900/- per sq. yd. should be adopted for the land at Radhey Shyam Park.

(3.) The revenue as well as the assessee filed appeals before the Tribunal being aggrieved by parts of the decision of the CIT (Appeals). The cross-appeals have been disposed of by the order dated 25.05.2012 which is impugned before us by the revenue. The Tribunal had taken the view that so far as the plot at Radhey Shyam Park was concerned the circle rate was Rs. 1,338 per sq. yd. whereas the apparent sale consideration was @ Rs. 1,441/- per sq. yd. and, therefore, in the absence of any concrete evidence to the contrary the circle rate should be adopted as representing the correct value of the land at Radhey Shyam Park since the circle rate was lower than the apparent sale consideration at the rate of Rs. 1,441/- per sq. yd. The Tribunal accepted at Rs. 1,441/- per sq. yd. As regards the land at Rajinder Nagar Industrial Area the Tribunal observed that circle rate was Rs. 2,508/- per sq yd. at the relevant time. The sale consideration that was shown at the rate of Rs. 1,000/- per sq. yd. was below the circle rate of Rs. 2509/- per sq yd. and, therefore, the Tribunal concluded that the CIT (Appeals) was justified in adopting the rate of Rs. 2,500/- per sq. yd