IN INCOME TAX APPELLATE TRIBUNAL, BENCH G , MUMBAI BEFORE SHRI R.C.SHARMA, ACCOUNTANT MEMBER AND SHRI PAWAN SINGH, JUDICIAL MEMBER ITA No.4737/Mum/2012 (Assessment Year : 2007-2008) Gautam T. Sharoff Assistant Commissioner of C/o M. R. Gulati & Co. Income Tax, Central Circle- 110, Makers Bhawan No. 3, 12(3), New Marine Lines Vs. Mumbai-400020. Mumbai-400020. PAN: AAACH0973N (Appellant) (Respondent) Assessee by : Sh. M. R. Gulati (AR) Revenue by : Sh.Jevan Lal Lavedia (DR) Date of hearing : 04.10.2016 Date of Pronouncement : 14.10.2016 ORDER PER PAWAN SINGH; 1. This appeal u/s. 253 of Income Tax Act ( Act ) is directed by assessee against order of Commissioner of Income Tax (Appeals)-38, Mumbai dated 18.09.2014 for Assessment Years (AY) 2010-11. 2. assessee has raised following grounds of appeal : Learned Commissioner of Income Tax (Appeals) has erred in not accepting appellant contention that purchase price of 3 plots should be as per purchase agreement only . 3. brief facts of case are that assessee filed return of income for relevant assessment year on 31 July 2007, declaring total income at Rs.36,33,462 /-. return was selected for scrutiny. AO while framing assessment noted that assessee has claimed Long Term Capital Gain on sale of immoveable property. assessee has computed gain on sale of building at Rs 2,50,000/-. It was further observed assessee purchased said property vide Sale deed dated 26 June1983, ITA 4737/M/2012 Gautam T Shroff consisting of land and building for consideration of Rs. 5,45,400/- along with her wife. While claiming Capital Gain assessee has taken cost of indexation for computing Capital Gain. AO issued show cause notice as to why Capital Gain on sale of building be calculated by taking purchased consideration as it attributable to building instead of entire purchase consideration which consist of cost of land and building both. In response to show cause notice assessee filed reply dated 18 December 2009 and also revise computation of income computing Long Term Capital Gain on building at Rs 21,92,440/- as against earlier claim of Rs 2,50,000/-. contention of assessee was not accepted by assessing officer and he calculated Long Term Capital Gains at Rs 22,54,390 /- on sale of building. Aggrieved by order of Assessing Officer, assessee filed appeal before Commissioner of income tax (Appeal). In appeal assessee urged that AO erred in calculating value of building at rate of Rs. 69,154 /-instead of Rs. 3,85,000 /-. During first appellate stage assessee contended vide written submissions date 03.02.2012 that assessee sold three separate parcel (peace) of land and not one as compared by Assessing Officer. cost of purchase by assessee for three properties was Rs. 5,85,000/- and not Rs.5,84,000/-. It was further contended that assessee had paid Rs. 10,000/- to Sh. TV Kini and Rs. 30,000/- to sons of Ganapthy for land. appellant with her wife sold land with area of 4.82 acre and building with two other parcel of land vide sale deed dated 14 February 2007. contention of assessee was not accepted by Learned CIT (Appeals) holding that assessee himself had offered Long Term Capital Gain of Rs 21,92,440/- in revise computation and AO assessed same at Rs 22,54,390/- and dismissed appeal. Aggrieved by order of Commissioner of income tax appeals, assessee has filed present appeal before us. 4. We have heard ld AR of assessee and ld DR for Rrevenue and perused material available on record. Learned AR of assessee argued that assessee has transferred three piece of land vide sale deed dated 14th February, 2007. assessee along with his wife acquired all three property on different dates. All those properties were transferred by way of single sale deed referred above. It was further argued that Assessing Officer as well as ld 2 ITA 4737/M/2012 Gautam T Shroff Commissioner of income tax (Appeals) failed to consider contention of assessee which were duly supported with documentary evidence. ld AR for assessee would argue that cost of acquisition of all three properties be considered at Rs.5,85,000/- instead of Rs.5,45,000/-. ld AR for assessee finally would argue that Revenue may be directed to consider cost of acquisition of three property/ piece of land at Rs.5,85,000/- Learned DR for Revenue strongly supported order of authorities below. Learned DR for Revenue would argue that assessee himself has taken inconsistent stand about cost of acquisition of property. Assessee himself provided working of Long Term Capital Gain of Rs.2,50,000 /-which was subsequently revised by assessee himself. It was finally argued that order of authority below does not require any interference at this stage. 5. We have considered rival contention of parties and gone through material available on record. very short question for our consideration is that what is cost of acquisition of properties which were sold by assessee in sale deed dated 14th February 2007. perusal of assessment order shows that AO has not gone through contents of sale deed dated 14th February, 2007. contents of said sale deed clearly mentioned about transfer of three piece (parcel) of land which consist of one Farm House with Godowns and two other piece of land (page no.1to10 of P/B). first piece of land consist of Farmhouse and building which was acquired by sale deed dated 22 June 1983(page11to28), second piece of land was acquired by way of deed of declaration dated 29 September 1982(page 29to 38 of p/b) and 3rd piece of land was acquired vide deed of settlement dated 28 December 1982 (page 39 to 58 of p/b). assessee has explained payment of consideration of Rs. 40,000/- in respect of two remaining piece of lands. We have observed that neither Assessing Officer nor learned CIT(A) taken into account cost of remaining two piece of land while computing Long Term Capital Gain. Thus, we are accepting contention of assessee that cost of acquisition of properties sold in sale deed is/ was Rs. 5,85,000/-. Accordingly, AO is directed to re- compute working of LTCG while taking into consideration cost of acquisition at Rs.5,85,000/- of three properties. We order accordingly. 3 ITA 4737/M/2012 Gautam T Shroff In result, appeal filed by assessee is allowed. Order announced in open court on 14th of October 2 016. Sd/- Sd/- (R.C.SHARMA) (PAWAN SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai; Dated 14/10/2016 S.K.PS Copy of Order forwarded to : 1. Appellant 2. Respondent. 3. CIT(A), Mumbai. 4. CIT BY ORDER, 5. DR, ITAT, Mumbai 6. Guard file. //True Copy/ (Asstt.Registrar) ITAT, Mumbai 4 Gautam T. Sharoff v. Assistant Commissioner of Income-tax, Central Circle- 12(3), Mumbai