Ita/6/2020 Of Azad Rahim v. The Income Tax Officer

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE S.V.BHATTI & THE HONOURABLE MR.JUSTICE BASANT BALAJI WEDNESDAY, THE 24 DAY OF NOVEMBER 2021 / 3RD AGRAHAYANA, 1943 ITA NO. 6 OF 2020 AGAINST THE ORDER/JUDGMENT IN GTA 1/COCH/2018 OF I.T.A.TRIBUNAL,COCHIN BENCHAPPELLANT/S: AZAD RAHIMAGED 77 YEARSS/O. FATHIMA RAHIM, MALIKA VEEDU, LAKSHMINADA, KOLLAM 68 REPRESENTED BY ITS DIRECTOR BY ADVS.G.HARIKUMAR (GOPINATHAN NAIR)SHRI.AKHIL SURESH RESPONDENT/S: THE INCOME TAX OFFICERWARD-1, KOLLAM BY ADV SRI.CHRISTOPHER ABRAHAM, INCOME TAX DEPARTMENT THIS INCOME TAX APPEAL HAVING COME UP FOR ADMISSION ON 24.11.2021, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ITA NO. 6 OF 2020 JUDGMENT S.V.Bhatti,J. Azad Rahim, son of late Fathima Rahim/assessee is theappellant. The Income Tax Officer, Ward-I, Kollam/Revenue is therespondent. The appeal is filed by the legal heir of the assesseebeing aggrieved by the order dated 30.04.2019 of the Income TaxAppellate Tribunal, Cochin Bench in GTA No.01/Coch/2018.2.The issue arises under the Gift Tax Act, 1958 in thereturn dated 25.07.1997 filed by the assessee. The Assessing Officercompleted the assessment under Section 15(2) of the Gift Tax Actdetermining the taxable gift of Rs.74,80,750/-. The Commissionerof Income Tax (Appeals) (for short, CIT(A)) and the Income TaxAppellate Tribunal (for short, 'the Tribunal') confirmed that therewas a taxable gift involved in the transaction. The assessee filedGTA Nos.2, 3, 4 of 2002 before this Court, and vide judgment dated21.01.2004 this Court confirmed the order of the Tribunal however,granted liberty to the assessee to file objections before the Departmental Valuation Officer (DVO) on the valuation arrived atby him and further directed the DVO to dispose of the objectionsfiled on the valuation of the property under gift by providingreasonable opportunity of hearing to the assessee. The assesseebeing aggrieved by the judgment of this Court in GTA No.2, 3, 4 of2002, filed Special Leave Petition (Civil) No.13810-13812/2004before the Supreme Court. On 28.07.2004,the Supreme Courtdismissed the appeal as withdrawn and accepted the permissionprayed by the assessee to approach the Valuation Authority inregard to the ownership of the building in question. 3.On 28.02.2005, pursuant to the liberty granted by thisCourt and the Supreme Court, a fresh assessment was completed.The assessee filed appeal before the CIT(A). The appeal beforeCIT(A) was dismissed and thereafter, on the appeal filed by theassessee before the Tribunal, the Tribunal directed considerationof objections filed on the valuation and also on the ownership ofthe property. Upon fresh and further remand, the DVO held thatthe assessee was the owner of the property in question. However, -4- the value of the gift of the immovable property was reduced fromRs.58,66,000/- to Rs.37,04,000/-. 4.On 04.03.2011, assessment for the assessment year1996-97 was completed. The assessee filed the appeal questioningthe assessment order dated 04.03.2011, and the appeal wasdismissed. The valuation prepared by the DVO was accepted andconfirmed the value of the gift of Rs.37,04,000/-. This lead to thefiling of G.T.A No.01/Coch/2018 before the Tribunal. The Tribunalthrough the order impugned in the appeal dismissed GTANo.01/Coch/2018. Hence the appeal with the following substantialquestions of law: “1.Whether the Hon'ble Tribunal was right in lawin holding that the Hon'ble Supreme court had onlygranted the appellant the liberty to question theissue regarding the ownership of the Building?2.Whether the Hon'ble Tribunal was right in lawon facts in holding that there wasn't any contraevidence brought on record to dispel the findings ofthe CIT(A)'s with regard to the ownership of thebuilding? “1.Whether the Hon'ble Tribunal was right in lawin holding that the Hon'ble Supreme court had onlygranted the appellant the liberty to question theissue regarding the ownership of the Building?2.Whether the Hon'ble Tribunal was right in lawon facts in holding that there wasn't any contraevidence brought on record to dispel the findings ofthe CIT(A)'s with regard to the ownership of thebuilding? 3.Whether the Hon'ble Tribunal was right in lawon facts in holding that the building was owned bythe appellant and not Malik Dinar Trust?” ITA NO. 6 OF 2020 -5- 5.The learned Counsel Harikumar G Nair argues that thisCourt in GTA Nos.2, 3, 4 of 2002, enabled the assessee to raise theobjections on the valuation report of the DVO. Further the libertygranted by the Supreme Court in Special Leave Petition (Civil)No.13810-13812/2004 order dated 28.07.2004, the ownership issueis kept at large. This view or position is accepted by the Tribunalwhile remanding the matter for consideration afresh to theAssessing Officer. The valuation report of the DVO is completelyuntenable, illegal, and is contrary to the valuationreport/objections submitted by the assessee. On the question oftitle, the view taken by the Tribunal is very perfunctory anduntenable. Therefore, he prays for answering the above questionsin favour of the assessee and against the Revenue. Alternatively, hecontends that the assessee is given an opportunity to establish theownership of the property and for the said purpose, prays forremand to the Tribunal. 6.Mr. Christopher Abraham, learned Standing Counselclarifies the position by stating that GTA Nos.2, 3, 4 of 2002 were ITA NO. 6 OF 2020 disposed of by this Court. The assessee was given liberty to fileobjections and direction was issued to the DVO to consider theobjections as well. The assessee moved the Supreme Court and theSupreme Court allowed the assessee to withdraw the appeal andhowever, granted permission to raise objection on the ownershipof the property under gift.6.1.He argues that the Supreme Court has merely grantedpermission to raise objections. Therefore, the permission nowgranted by the Supreme Court does not in any manner come to theaid or assistance of the assessee. The Assessing Officer, CIT(A),and the Tribunal, in the first round of the litigation, have noted thelegal obligation to examine both the issues viz. valuation andownership of the property and have accordingly, renderedfindings. The valuation is scaled-down from Rs.58,66,000/- toRs.37,04,000/-. Thus the objections are considered and now thefindings recorded by the Tribunal based on the record are pureand simple findings of the fact, therefore does not come within thejurisdiction of this Court under Section 260A of the Income Tax -7- Act, 1961. 7.Replying to the argument of the assessee on theownership issue, it is stated that the execution of gift deed assumescertain state of affairs between the parties and the property.Contrary to the written document, the assessee wants to plead andprove before the authorities. It is in this background the Tribunalobserved that there is no shred of evidence to record a finding inany way except that the assessee was the owner of the propertyunder gift. Therefore, upon two rounds of remand, still, thedissatisfaction recorded by the assessee on the findings recordedby the Authorities does not warrant consideration by this Court.He prays for summarily dismissing the appeal. 8. The questions deal with valuation and ownership. Letus briefly examine the valuation finally confirmed by theassessment order dated 04.03.2011. This Court in GTA Nos.2, 3, 4 of2002 enabled the assessee to file objections and also directedconsideration of the objections. What has been marginally left forconsideration by the direction is only valuation and objections ITA NO. 6 OF 2020 8. The questions deal with valuation and ownership. Letus briefly examine the valuation finally confirmed by theassessment order dated 04.03.2011. This Court in GTA Nos.2, 3, 4 of2002 enabled the assessee to file objections and also directedconsideration of the objections. What has been marginally left forconsideration by the direction is only valuation and objections ITA NO. 6 OF 2020 have been received, fresh valuation has been undertaken, thereport is considered by the Assessing Officer and thereafter, thevalue is reduced. The method and mode of valuation suggested bythe assessee and/or documents relied on by the assessee areindependently considered and rejected. The CIT(A) and theTribunal have accepted the revised valuation given in theassessment order dated 04.03.2011. Except raising a bald allegationthat the property has been excessively valued than what wasprevailing at the time of execution of gift deed, hardly any materialmuch less substantial material is placed before the Authoritiesunder the Act, atleast to canvass the ground in this Court that thefinding of fact is recorded without considering the material on therecord. The ipse dixit contention does not carry the assesseeanywhere. Each one of the orders we have independentlyconsidered in this behalf and we are in agreement with thefindings of fact recorded by the Tribunal on the valuation. Hence,the argument advanced by the assessee on the valuation, nowdetermined by the Authorities under the Act, does not warrant -9- interference and is without merit and rejected. 9.Adverting to the argument on ownership to theproperty, we notice the legal heir of the assessee particularly, thedonee under the gift deed dated 20.04.1995, was granted liberty bythe Supreme Court to raise objections on ownership of theproperty. The objections as rightly pointed out by Mr. ChristopherAbraham, go to the root of the very transaction under which thelegal heir of the assessee is contesting the ownership. The assesseeor her legal heir is now contesting the ownership of the property.Looking at from general principles of law, the burden is on theassessee or her legal heir to prove that the ownership of theproperty vests with someone else, not the assessee. The entries inRevenue records, or the name of the assessee in MunicipalCorporation, are not conclusive as regards the ownership of theproperty. The Tribunal, therefore, in our considered view, rightlyobserved that the assessee failed to place contra evidence on theownership of the property. 10.The findings of fact recorded by the Tribunal are concurrent findings of fact recorded by the Authorities under theAct. Expecting the Tribunal to restate every conclusion whileconfirming the findings in all fours, is not the requirement of theadjudication before the Tribunal. Therefore, the findings aretenable and are sustained accordingly. No ground is made outwarranting firstly, interference and secondly, for limited purpose,remitting the matter to the Tribunal. The appeal fails, accordingly dismissed. No order as to costs. Sd/- S.V.BHATTI JUDGE Sd/-BASANT BALAJI JUDGE JS ITA NO. 6 OF 2020 APPENDIX OF ITA 6/2020 PETITIONER'S ANNEXURES: ANNEXURE A1ORDER DATED 28-07-2004 IN SPECIAL LEAVEPETITION (CIVIL) NO. 13810-13812/2004PETITION (CIVIL) NO. 13810-13812/2004 ANNEXURE A2ORDER IN GTA NO. 07 AND 08 (COCH)/2006 DATED24-04-2007 OF THE HON'BLE INCOME TAX APPELLATETRIBUNAL, COCHIN BENCH24-04-2007 OF THE HON'BLE INCOME TAX APPELLATETRIBUNAL, COCHIN BENCH ANNEXURE A3VALUATION REPORT DATED 30-10-2007 ANNEXURE A4ORDER IN NO. GT-5(NEW PAN )/W-1/KLM/96-97 DATED 04/03/20111/KLM/96-97 DATED 04/03/2011 ANNEXURE A5MEMORANDUM OF APPEAL DATED 25-04-2011 FILEDBEFORE THE COMMISSIONER OF INCOME TAX(APPEALS)BEFORE THE COMMISSIONER OF INCOME TAX(APPEALS) Sd/- S.V.BHATTI JUDGE Sd/-BASANT BALAJI JUDGE JS ITA NO. 6 OF 2020 APPENDIX OF ITA 6/2020 PETITIONER'S ANNEXURES: ANNEXURE A1ORDER DATED 28-07-2004 IN SPECIAL LEAVEPETITION (CIVIL) NO. 13810-13812/2004PETITION (CIVIL) NO. 13810-13812/2004 ANNEXURE A2ORDER IN GTA NO. 07 AND 08 (COCH)/2006 DATED24-04-2007 OF THE HON'BLE INCOME TAX APPELLATETRIBUNAL, COCHIN BENCH24-04-2007 OF THE HON'BLE INCOME TAX APPELLATETRIBUNAL, COCHIN BENCH ANNEXURE A3VALUATION REPORT DATED 30-10-2007 ANNEXURE A4ORDER IN NO. GT-5(NEW PAN )/W-1/KLM/96-97 DATED 04/03/20111/KLM/96-97 DATED 04/03/2011 ANNEXURE A5MEMORANDUM OF APPEAL DATED 25-04-2011 FILEDBEFORE THE COMMISSIONER OF INCOME TAX(APPEALS)BEFORE THE COMMISSIONER OF INCOME TAX(APPEALS) ANNEXURE A6HEARING NOTE FILED BY THE APPELLANT BEFORETHE COMMISSIOENR OF INCOME TAX (APPEALS)THE COMMISSIOENR OF INCOME TAX (APPEALS) ANNEXURE A7VALUATION REPORT DATED 16-08-2014 FILEDBEFORE THE COMMISSIONER OF INCOME TAX(APPEALS)BEFORE THE COMMISSIONER OF INCOME TAX(APPEALS) ANNEXURE A8ORDER IN GT NO. 3/KLM/CIT (A) TVM/2011-12DATED 17-08-2018 PASSED BY THE COMMISSIONEROF INCOME TAX (APPEALS)DATED 17-08-2018 PASSED BY THE COMMISSIONEROF INCOME TAX (APPEALS) ANNEXURE A9CERTIFICATE DATED 19-01-2002 ISSUED BY THEKOLLAM CORPORATIONKOLLAM CORPORATION ANNEXURE A10ORDER DATED 30-04-2019 IN GTA NO. 01/COCH/2018OF THE HON'BLE INCOME TAX APPELLATETRIBUNAL.OF THE HON'BLE INCOME TAX APPELLATETRIBUNAL.