The Commissioner Of Income Tax, Patiala v. Gurpal Singh

In the High Court of Punjab & Haryana at Chandigarh The Commissioner of Income Tax, Patiala vsGurpal Singh ITA No. 1 of 1988 (O&M)Date of decision: 10.9.2010 .. Appellant.. Respondent Coram: Hon'ble Mr. Justice Adarsh Kumar GoelHon'ble Mr. Justice Rajesh Bindal Present: Mr. Tajender K. Joshi, Advocate for the appellant. Rajesh Bindal J. The revenue is in appeal against the order dated 2.11.1987 passed bythe Income Tax Appellate Tribunal, Chandigarh Bench, Chandigarh (hereinafter tobe referred as “the Tribunal”) in I.T. (Acq) No. 10/Chandi/87. Briefly the facts are that on an information received from Sub-Registrar, Chandigarh, that House No. 510, Sector 33-B, Chandigarh, waspurchased by the respondent for ` 5 lacs whereas the fair market value thereofwas ` 8.45 lacs, a notice was issued to the respondent under Section 269 F (6) ofthe Income Tax Act, 1961 (for short, “the Act”) approving the acquisition of thehouse. The Tribunal accepted the appeal filed by the assessee holding that in termsof CBDT Circular No. 455 dated 16.5.1986, no proceedings in the matter foracquisition of property could be initiated. Learned counsel for the appellant submitted that reliance on theaforesaid circular was totally misplaced considering the fact that proceedings hadalready been initiated and the same could be dropped if the value of the propertywas less than ` 5 lacs whereas in the present case the value of the property was ` 5lacs. After hearing learned counsel for the appellant, we do not find anymerit in the submissions made. The circular provides that the proceedings underSection 269 F(6) of the Act will not be initiated in respect of an immovableproperty of which the apparent consideration was ` 5 lacs or less. It is only that inthe subsequent line where the direction was for dropping of the proceedingsalready initiated that it was mentioned that the value of the property should bebelow ` 5 lacs which is in contradiction to the spirit of the circular. The intentionseems to be for dropping the proceedings where the apparent consideration is ` 5lacs or less. Admittedly in the present case the consideration was ` 5 lacs. Considering the aforesaid fact, we do not find that any illegality hasbeen committed by the learned Tribunal in accepting the appeal filed by therespondent. Accordingly, the appeal filed by the revenue against the order of theTribunal is dismissed being devoid of merits. (Rajesh Bindal)Judge 10.9.2010vs (Adarsh Kumar Goel)Judge