DCIT, CENTRAL CIRCLE-1, COIMBATORE, RACE COURSE ROAD V. D.RAMGOPAL, COIMBATORE

MA 47/CHNY/2025

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The case involves the Revenue's Miscellaneous Application seeking rectification of the Income Tax Appellate Tribunal's order concerning the assessment year 2013-14. The original dispute centered on the valuation of property sales for capital gains tax under section 50C of the Income Tax Act, where the assessee, Shri D. Ramagopal, had sold properties at values less than the stamp duty value. The Tribunal had directed the Assessing Officer to consider the sale consideration as per the registered sale deed or Rs.245/- per sq.ft., whichever is higher, and allowed certain deductions. The Revenue contended that the Tribunal erroneously accepted unregistered sale agreements for valuation, which was contrary to the provisions of section 50C as it stood during the relevant period. The Tribunal dismissed the Revenue's application, stating that the issues raised did not constitute a mistake apparent from the record but rather questioned the correctness of the decision, which is not permissible under section 254(2).

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 785346 (ITAT-CHENNAI)
• Duration Of Justice: 6 month(s) 18 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 27-10-2025
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2013-2014
• Appeal Filed On: 09-04-2025
• Other Referred Cases: ACIT vs. Saurashtra Kutch Stock Exchange Ltd. [(2008) 305 ITR 227 (SC)]
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: WAYOFTHISMISCELLANEOUSAPPLICATIONISSEEKING
• Keywords: Additional evidence; Sale consideration of property below Jantri Value; Capital Gains; Wrong claim; Bogus
• Section: 143(3); 132; 153A; 50C

Judgement Text

"आयकर अपीलीय अिधकरण, ‘ए’ \u0001यायपीठ, चे ई IN THE INCOME TAX APPELLATE TRIBUNAL ‘A’ BENCH, CHENNAI \u0002ी एबी ट\u0006 वक , या यक सद\u0010य एवं \u0002ी एस. आर. रघुनाथा, लेखा सद\u0010य क े सम BEFORE SHRI ABY T VARKEY, JUDICIAL MEMBER AND SHRI S.R.RAGHUNATHA, ACCOUNTANT MEMBER M.A. No.47/Chny/2025 [In I.T.A. No.583/Chny/2022] नधा रण वष /Assessment Year: 2013-14 DCIT, Central Circle -1, Coimbatore. Vs. Shri. D. Ramagopal, 14-A, 10th Street. Ganapathypudur, Ganapathy, Coimbatore – 641 006. (!ाथ क /Petitioner) [PAN: AKGPR-3621-L] (!\"यथ#/Respondent) !ाथ क क$ ओरसे/ Petitioner by : Mr. N. Rajkumar, JCIT !\"यथ# क$ ओर से/Respondent by : None सुनवाई क$ तार\u0006ख/Date of Hearing : 29.08.2025 घोषणा क$ तार\u0006ख/Date of Pronouncement : 27.10.2025 आदेश /O R D E R PER S.R. RAGHUNATHA, AM: The Revenue by way of this Miscellaneous Application is seeking rectification of the following mistakes apparent on record in the order passed on 23.10.2024 in ITA No.583/Chny/2022 for the assessment year 2013-14: 2. The revenue in its application submitted the following: Printed from counselvise.com :-2-: MA No:47/Chny/2025 “Brief Facts of the case: 2. The assessee, Shri. D Ramagopal (PAN: AKGPR3621L) was engaged in the Financing business. A search u/s 132 was conducted in the case of the assessee on 27.11.2013. As a result of the search and post search enquiries various undisclosed income and investments made by the assessee was found. Subsequently, the assessment proceedings u/s 153A of the Act was initiated in the case of the assessee for the AY 2013-14 by issuing notice u/s 153A on 26.12.2014. The assessee filed the return of income of the A.Y.2013-14 оп 02.01.2016 by declaring Nil income and agricultural income of Rs.7,43,000/-. The assessment proceedings u/s 143(3) r.w.s 153A was completed on 30.03.2016 by making the following additions: Income Returned in response to notice u/s 153A Nil Add: Interest on Fixed Deposit Rs.41,144 Add: Long Term Capital Gain Rs.26,81,928 Assessed Income Rs.27,23,072 3. The claim of the agricultural income of Rs.7,43,000/- was considered as bogus claim by the Assessing Officer. 4. Aggrieved by the order, the assessee filed an appeal before the CIT(A). The learned CIT(A) dismissed the appeal of the assessee vide order in ITA No. 278/19-20 dated 25.05.2022. Aggrieved by the order of CIT(A) for the AY 2013-14, the assessee preferred further appeal before Hon'ble ITAT. The Hon'ble ITAT partly allowed the appeal of the assessee vide its order in ITA No.583/Chny/2022 dated 23.10.2024. 5. The assessee sold two properties during the AY 2013-14 measuring 7.25 cents to one, Shri. C. V Abbas for Rs. 11.71 lakhs (received in cash) and 4.50 cents to one, Shri. A S Sundaram for Rs.6.90. lakhs (Rs.1,40,000/- in cash and Rs.5,50,000/- credited to his bank account IOB 20813). However, the assessee did not declare the income from capital gain in his ITR. The Assessing Officer adopted the sale consideration of Rs.27.50 lakhs and Rs.8.00 lakhs respectively for the two properties to arrive at the long term capital gain at Rs.26,81,928/- as per the provisions of section 50C. The Hon'ble ITAT has directed the AD to consider the sale consideration shown as per the registered sale deed or Rs.245/- per sq.ft. whichever is higher as the sale value for computing the long term-capital gain. Further, the Hon'ble ITAT has also directed the AO to consider the amount of Rs.6,12,328/- paid by the assessee to TNPID Court, towards removal of attachment on the properties, as an allowable deduction to compute the long-term capital gains tax. Printed from counselvise.com :-3-: MA No:47/Chny/2025 Petition: 6. The assessee has sold both the properties for the sale consideration less than the stamp duty value as on the date of sale. During the assessment proceedings also, the assessee suo moto adopted the stamp duty value (as on the date of sale) as the sale consideration as per the provisions of section 50C of the Act and furnished the statement of income computation. The same values of sale consideration for both the properties were adopted by the Assessing Officer to compute the capital gain. The various expenses claimed by the assessee towards the sale of property were not accepted by the Assessing Officer. The addition of the Assessing Officer was upheld by the Ld. CIT(A) in this issue. 7. However, before the Hon'ble ITAT, the assessee produced two notarized \"sale agreements claimed to be entered on 15.03.2012 which were not originally produced during the assessment proceedings. The sale deeds were claimed to be executed on 18.09.2012 and 05.12.2012 respectively. The Hon'ble ITAT has neither clearly mentioned whether those sale agreements were registered or not, nor the AD was provided with an opportunity to respond to the additional evidence submitted. Further, on perusal of the Encumbrance certificates for those properties, the above mentioned agreements dated 15.03.2012 were not found to be entered into. Hence, the said agreements are not registered. Therefore, it is clear that the Hon'ble ITAT has directed the AO to adopt lesser values of sale consideration based on the unregistered sale agreements only. Section 50C of the Act, as it stood on the date of transfer of property, mandates that the stamp duty value on the date of the registered sale deed should be considered for computing capital gains. Since, the actual sale deed was executed on 18.09.2012 & 05.12.2012, the stamp duty value on those dates should apply and not the value as on the dated of unregistered sale deed. 8. Further, it is to be noted that the amendment to section 50C, made vide Finance Act, 2017 allowed consideration from an agreement to be taken as sale value if the agreement was entered before the date of the registered sale deed. It also mandates that the full consideration should be paid through account payee cheque, bank draft or electronic transfer on or before the date of the registered agreement. However, this amendment is applicable prospectively from AY 2017-18 and does not apply to AY 2013-14, Further, the assessee did not receive the sale consideration through banking transaction prior to the registration of sale deed Hence, the Hon'ble ITAT's reliance on an unregistered sale agreement which was claimed to be entered on an earlier date is contrary to the provisions of section 50C. Since, the claim of the assessee regarding the sale agreement is an afterthought, mere to misuse the provisions of section 50C (which was applicable from 01.04.2017 only), it is humbly prayed that the Hon'ble ITAT may consider the issue of acceptance of the unregistered sale agreement to decide upon the value of sale consideration. Printed from counselvise.com :-4-: MA No:47/Chny/2025 9. This miscellaneous application is being submitted before the Hon'ble ITAT for kind perusal and consideration as per the directions of the Director General of Income Tax (Investigation), Tamil Nadu & Puducherry.” 3. The ld.DR for the revenue argued that the Tribunal while allowing the appeal of the assessee has accepted the ‘unregistered sale agreement’ as a valid document for the purpose of valuation u/s.50C of the Act, which is erroneous. 4. We have heard the ld.DR and gone through the material available on record and details filed by the revenue. None appeared on behalf of the assessee despite notice. At the outset, we note that the scope of jurisdiction under section 254(2) of the Act is limited to rectification of a mistake apparent from the record, and does not extend to a review of the Tribunal’s order. The Hon’ble Supreme Court in the case of ACIT vs. Saurashtra Kutch Stock Exchange Ltd. [(2008) 305 ITR 227 (SC)] has clearly laid down that a “mistake apparent from the record” must be obvious, patent and self-evident, and not something which requires elaborate arguments or re-appreciation of facts and evidence. 5. In the present case, the Tribunal, after considering the submissions and documents filed, recorded a finding that the sale consideration was to be computed on the basis of the sale agreements or Rs.245/- per sq.ft., whichever is higher, and also allowed certain expenses related to removal of Printed from counselvise.com :-5-: MA No:47/Chny/2025 property attachment. These directions were rendered after appreciation of the factual matrix and evidence placed on record. The Revenue’s grievance that the Tribunal relied upon unregistered sale agreements and misapplied section 50C essentially questions the correctness of the decision and calls for a review of the order, which is impermissible under section 254(2). In the garb this miscellaneous application, the revenue wants to reargue the matter again. 6. The Revenue’s contention regarding the prospective applicability of the amendment to section 50C is a matter of legal interpretation, and any alleged error therein, even if assumed, would not qualify as a “mistake apparent from record.” The Tribunal has rendered a conscious and reasoned decision on the applicability of section 50C based on the facts presented during appellate proceedings. 7. Further, the Revenue had opportunity to raise objections regarding the admissibility or authenticity of the sale agreements during the appellate hearing. No conclusive record has been brought to demonstrate that the Tribunal overlooked any material fact or committed a manifest error which is rectifiable under the limited scope of section 254(2). Printed from counselvise.com :-6-: MA No:47/Chny/2025 8. In view of the above, we find that no mistake apparent from the record in the Tribunal’s order dated 23.10.2024 has been pointed by the revenue warranting rectification. 9. Accordingly, the Miscellaneous Application filed by the Revenue is dismissed. Order pronounced in the open court on 27th October, 2025 at Chennai. Sd/- Sd/- (एबी ट\u0006 वक ) (ABY T VARKEY) या यक सद\u0010य/JUDICIAL MEMBER (एस. आर. रघुनाथा) (S. R. RAGHUNATHA) लेखा सद\u0010य/ACCOUNTANT MEMBER चे नई Chennai: +दनांक Dated : 27th October, 2025 sp आदेश क$ ! त-ल.प अ1े.षत /Copy to: 1. अपीलाथ#/Appellant 2. !\"यथ#/Respondent 3. आयकरआयु2त/CIT, Chennai/Coimbatore/Madurai/Salem. 4. .वभागीय! त न5ध/DR 5. गाड फाईल/GF Printed from counselvise.com "