G.S. PROCON PRIVATE LIMITED ,KOLKATA V. ACIT, CIRCLE 5(2), , KOLKATA

ITA 509/KOL/2025

AI Insights

The case involves G.S. Procon Private Limited, a civil contracting company, appealing against the order of the CIT(A), National Faceless Appeal Centre, Delhi, for the assessment year 2015-2016. The primary issue was the application of Section 56(2)(vii)(b)(i) of the Income Tax Act, which pertains to the disallowance of the difference between the documented value and the market value of flats sold. The Assessing Officer had incorrectly applied this provision, which is applicable to individuals or HUFs, to the assessee, a company. The tribunal, after considering the legal submissions and the precedent from the Bombay High Court, allowed the appeal, thereby deleting the addition made by the Assessing Officer.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 824477 (ITAT-KOLKATA)
• Duration Of Justice: 9 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-01-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2015-2016
• Appeal Filed On: 11-03-2025
• Other Referred Cases: Neelkamal Realtors & Erectors India (P.) Ltd. vs. [2017] 79 taxmann.com 238 (Bombay)
• Laws Referred To: Section 56(2)(vii)(b)(i) of the Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: BONNIE DEBBARMA
• Assessee Lawyers: SOMNATH GHOSH
• Keywords: Condonation of delay

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH, KOLKATA BEFORE SHRI GEORGE MATHAN, JUDICIAL MEMBER AND SHRI RAJESH KUMAR, ACCOUNTANT MEMBER आयकर अपील सं/ITA No.509/KOL/2025 (निर्धारण वर्ा / Assessment Year : 2015-2016) G.S.Procon Private Limited, 388, Barakhola Road, Mukundpur, Kolkata-700099 Vs ACIT, Circle-5(2), Kolkata PAN No. :AADCG 6018 J (अपीलधर्थी /Appellant) .. (प्रत्यर्थी / Respondent) निर्धाररती की ओर से /Assessee by Shri Somnath Ghosh, AR & Miss Muskan Sethia, AR रधजस्व की ओर से /Revenue by : Shri Bonnie Deb Barma, Sr. DR सुनवाई की तारीख / Date of Hearing : 01/01/2026 घोषणा की तारीख/Date of Pronouncement : 01/01/2026 आदेश / O R D E R Per Bench : This is an appeal filed by the assessee against the order of the ld. CIT(A), National Faceless Appeal Centre (NFAC), Delhi, dated 29.01.2024 for the assessment year 2015-2016. 2. The appeal of the assessee is filed belatedly by 345 days. In this regard, the Managing Director on behalf of the assessee company has filed an application for condonation of delay stating therein that due to some unavoidable circumstances and due to his illness, the appeal could not be filed within the time, therefore, he requested that the delay in filing the appeal may kindly be condoned and the appeal of the assessee company be admitted for hearing. Ld. Sr. DR also did not raise any serious objection to condone the delay. Considering the submission of the ld. AR and the prayer of the Managing Director on behalf of the assessee company, the Printed from counselvise.com ITA No.509/KOL/2025 2 delay of 345 days in filing the appeal is condoned and the appeal is admitted for hearing. 3. It was submitted by the ld. AR that the assessee is in the business of civil contractor. In the course of assessment, the Assessing Officer had invoked the provisions of Section 56(2)(vii)(b)(i) of the Act (wrongly mentioned by the Assessing Officer as 56(1)(vii)(b)(i)) and had disallowed the difference between the documented value and the market value in respect of flats sold by the assessee to various purchasers. It was the submission that the assessee is a company and the assessee is also recognised as a company in the assessment order in column 5 of the status. It was the submission that the provision of Section 56(2)(vii)(b)(i) of the Act applies to an individual or HUF. It was the submission that the assessee being not an individual nor an HUF, the provision of Section 56(2)(vii)(b)(i) of the Act is not applicable to the assessee. Ld.AR also placed reliance on the decision of the Hon’ble Bombay High Court in the case of Neelkamal Realtors & Erectors India (P.) Ltd., reported in [2017] 79 taxmann.com 238 (Bombay). It was the submission that the addition as made by the Assessing Officer and as confirmed by the ld. CIT(A) is liable to be deleted. 4. In reply, ld.Sr. DR submitted that the assessee had not cooperated in the assessment proceedings or before the ld.CIT(A). He vehemently supported the order of the ld. Assessing Officer and ld. CIT(A). 5. We have considered the rival submissions. As it is noticed that the issue is purely a legal issue and as the provision of Section 56(2)(vii)(b)(i) of the Act does not apply to the assessee, which is admittedly a company, Printed from counselvise.com ITA No.509/KOL/2025 3 the addition as made by the Assessing Officer and as confirmed by the ld.CIT(A) stands deleted. Our view is supported by the decision of the Hon’ble Bombay High Court in the case of Neelkamal Realtors & Erectors India (P.) Ltd., referred to supra. Thus, the appeal of the assessee is allowed. 6. In the result, appeal of the assessee is allowed. Order dictated and pronounced in the open court on 01/01/2026. Sd/- (RAJESH KUMAR) Sd/- (GEORGE MATHAN) लेखा सदस्य/ ACCOUNTANT MEMBER न्यधनयक सदस्य / JUDICIAL MEMBER कोलकाता Kolkata; ददनाांक Dated 01/01/2026 Prakash Kumar Mishra, Sr.P.S. आदेश की प्रनतललपप अग्रेपर्त/Copy of the Order forwarded to : आदेशधिुसधर/ BY ORDER, (Assistant Registrar) Income Tax Appellate Tribunal, Kolkata 1. अपीलार्थी / The Appellant- 2. प्रत्यर्थी / The Respondent- 3. आयकर आयुक्त(अपील) / The CIT(A), 4. आयकर आयुक्त / CIT 5. विभागीय प्रविविवि, आयकर अपीलीय अविकरण, कोलकाता / DR, ITAT, Kolkata 6. गार्ड फाईल / Guard file. सत्यापपत प्रतत //True Copy// Printed from counselvise.com "