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12-03-2019, Delilah Raj Mansukhani, Section 54, 54F, Tribunal Mumbai

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2 months 6 days ago #8795 by amit
Section - 54, 54F, 45
Order Date - 12-03-2019
Favouring - Assessee
Court - Tribunal Mumbai
Appellant - Delilah Raj Mansukhani
Respondent - ITO
Citation - 319Taxpundit243
Appeal No. - ITA No.3526/Mum/2017
Asstt. Year - 2010-11



This is an appeal filed by the assessee against the order of the ld. CIT(A)-46, Mumbai dated 10/03/2017 for the A.Y. 2010-11 in the matter of the order passed u/s.143(3) of the Income Tax Act, 1961 (in short the Act). The assessee has raised the following grounds of appeal:

“1. On the facts and circumstances of the case and in law, the Ld CIT(A) erred in upholding the order of the Ld. AO granting partial deduction u/s 54F/54.

2. On the facts and circumstances of the case and in law, the Ld. CIT(A) erred in directing the AO to take the cash component at Rs. 2,59,97,500/- instead of Rs. 2,53,00,000/- for computing the sale consideration.

3. On the facts and circumstances of the case and in law, the Ld. CIT(A) erred in directing the AO to refer the matter of determining the fair market value as in 01.04.1981 of the asset sold, thereby ignoring the binding decision of the Hon’ble Bombay High Court in the case of CIT vs. Puja Prints (2014) 360 ITR 697 and other decisions which were brought to the notice of the Ld. CIT(A).

4. On the facts and circumstances of the case and in law, the Ld. CIT(A) erred in directing the AO to adopt the fair market value as on 01.04.1981 of the asset sold as determined by the DVO and there by ignoring the valuation report issued by the assessee by the registered valuer.

5. On the facts and circumstances of the case and in law, the order of the Ld. CIT(A) enhancing the assessment on account of rental income for alternate accommodation of Rs. 2,60,000/- is bad in law.

6. On the facts and circumstances of the case and in law, the Id. CIT(A) erred in enhancing the assessment holding that the rent received for alternate accommodation of Rs. 2,60,000/- is eligible to tax.

7. On the facts and circumstances of the case and in Law, the Learned CIT(A) erred in holding that the levy of interest u/s 234B and 234C are consequential in nature.

8. On the facts and circumstances of the case and in law, the CIT(A) erred in confirming the action of A.O. of initiating of the penalty proceedings u/s. 271(1)(c).

The appellant craves eave to add, alter, amend, delete or modify any of the above-referred grounds of appeal”

2. Rival conten ions have been heard and record perused. Facts in brief are that the assessee is an individual deriving income from Salary and Other Sources. During the year under consideration, the Assessee, vide agreement dated 04.07.2009 granted development rights of her share (50%) in the property “Dommus Josephi” Plot No 160, Perry Road, Bandra (W), Mumbai (except an FSI of approx. 2,850 square feet), which was gifted to her by her uncle Joseph Aloysius Fernandes, to Calvin Properties Developers (Developers). As regards the floor space index (FSI) of approx. 2,850 square feet carpet area, it was retained / reserved by her for construction of her residence in the new building proposed to be constructed by the Developers (page 14, Article 3.1).Hence, as per the terms mentioned in the development agreement (DA), the Assessee is entitled to a consideration of Rs. 2,53,00,000/- and the cost of construction of the two residential units admeasuring 1,425 sq. ft. each, one on the first and the other on the second floor as the said FSI continued to belong/owned by the Assessee in terms of Article 4 of the DA

3. During the course of assessment proceedings with respect to the assessee’s claim of long term capital gain, the Assessing Officer asked the assessee to file copy of valuation report of registered valuer and her bank statements. Since the assessee was not having copy of valuation report she asked her registered valuer to provide with a duplicate copy of valuation report. It was informed by the registered valuer that the fair market value of the property as on 01/04/1981 was Rs. 41,20,000/-.

4. During the course of assessment proceedings, vide order sheet noting dated 15.3.2013 and notice dated 19.3.2013, the AO directed the AR of the assessee to file a copy of the valuation report of the registered valuer and also her bank statements. Vide letter dated 22.3.201, the assessee informed the AO that she had misplaced the documents and will obtain a copy from the registered valuer and the bank respectively and submit them. As a layman, she understood that the said amount was the FMV of 100% of the property and hence she had made an error in the

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