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14-12-2018, Amarjeet Thapar, Section 147, 148, 54, 2(47), HIGH COURT OF BOMBAY
1. We have heard learned counsel for the parties for final disposal of the petition by consent.
2. Petitioner has challenged a notice of reopening of assessment dated 28.3.2018. The petition arises in following backgrounds:-
The petitioner is an individual. For the assessment year 2013-14, the petitioner had filed return of income declaring total income of Rs. 65,51,360/-. The return was accepted by the assessing officer under Section 143(1) of the Income Tax Act, 1961 (“the Act” for short). In order to reopen the assessment, impugned notice came to be issued. The assessing officer had recorded reasons for reopening of assessment. The reasons read as under:-
The assessee has filed the return of income for A.Y. 2013-2014 on 27.07.2013, declaring total income at Rs. 65,51,362/-. The return was processed u/S. 143(1) of the Act and returned income was accepted.
2. On verification of the ITR for A.Y. 2013-14 it is seen that the assessee has worked out LTGC on sale of Flat as under. Thus, the assessee has shown the year of acquisition as 1992 and based on this worked out the indexed cost of acquisition at Rs. 2,39,29,459/-.
3. During the assessment proceedings for A.Y. 2014-15, the assessee was requested to provide the sources of investments made during the year. The assessee had submitted that she had in the previous year sold one property and through its proceeds made investment during the year. The assessee had given the details of purchase of the said property and submitted the following:-
3. Copy of purchase agreement dated 30.10.1992 for purchase of house No. D 1 at Mandar Co-operative Housing Society Ltd., Juhu Mumbai for Rs. 64,00,000/- by Ms. Amarjeet Thapar (Transferee) from Ms. Clare M. Fernandes (Transferor)
a. The said house property was acquired by Appropriate Authority (AA) constituted under the provisions of Chapter XXC of the Income Tax Act, 1961 in the year 1993.
b. The assessee filed writ petition No.289 of 1993 in the High Court of Bombay for challenging the said acquisition by AA.
c. By order dated 04.06.2017 issued by Division Bench of the Bombay High Court the said property was allowed and the said acquisition by the AA was set aside and assessee was directed to pay a sum of Rs. 56,13,227/- to AA being the amount of AA had paid to transferor on the said acquisition (copy of High Court order dated 04.06.2007 is enclosed).
d. The assessee deposited the said sum of Rs. 56,13,227/- with the Prothonotary and Senior Master of the Bombay High Court as per the order dated 29.06.2007 issued by Justice S. Radhakrishnan of the Bombay High Court (copy of said order is enclosed)
e. Against the order dated 04.06.2007 of the Division Bench, the ITD preferred a SLP to Supreme Court bearing CC No. 8872/2008. By an order dated 14.07.2008 issued by Justice S.H. Kapadia and Justice B. Sudershan Reddy of Hon'ble Supreme Court of India, the SLP filed by ITD was dismissed. (copy of the said order is enclosed).
f. Hence the cost of house property is Rs. 62,63,227/- (Rs. 6,50,500/- advance given as per purchase agreement dated 30.10.1992 + Rs. 56,13,227/-consideration as per order dated 04.06.2007 of the Bombay High Court.
g. The Income Tax Department handed over possession on 16.11.2009 which was taken by the AA in 1993.
h. In order to get the clear title of the property, the assessee registered the deed of transfer dated 26.04.2011 and paid the stamp duty of Rs. 30,60,700/- and registration fees of Rs. 31,500/-.
4. From the above submission, it is seen that the assessee had received possession of the Flat on 16.11.2009 i.e in F.Y. 2009-10 and paid the consideration of Rs. 56,13,227/- in pursuance to the order of the Hon'ble Bombay High Court dated 04.06.2007 in F.Y. 2007-08. The order of the Hon'ble Bombay High Court dated 29.06.2007 in WP No. 289 of 1993 in para No. 2 reads as under:- Paragraph No. 34 of our order dated 4th June 2007 stands deleted and substituted by the following paragraph:- 34. The Income Tax Department shall hand over the possession of the premises and also execute necessary deed of sale and convey the property and register the same immediately on receipt of the said sum of Rs. 56,13227/-.
5. From the plain reading of the above para, it is clear that as per the order of the Hon'ble High Court, the assessee became the owner of the property in F.Y. 2007-08. However, for the purpose of computing the indexed cost of acquisition the assessee has taken F.Y. 1992-93 as year of acquisition, which is erroneous as the