Shri Gopichand B.Lalwani, Kolhapur V. DCIT, Kolhapur

ITA 1154/PUN/2012

• Counselvise Citation: 115424514 RSA 2012
• Duration Of Justice: 2 year(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-06-2014
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 04-12-2013
• Assessment Year: 2007-2008
• Appeal Filed On: 01-06-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: MRS M S VERMA
• Keywords: Unexplained investment; Sale consideration of property below Jantri Value; Value adopted by valuation officer; Search and seizure; Loose papers; Cost of acquisition; Fair market value; Valuation report; Competent authority
• Section: 50C; 153A; 69; 6

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A , PUNE BEFORE: SHRI G. S. PANNU, ACCOUNTANT MEMBER AND SHRI R.S. PADVEKAR, JUDICIAL MEMBER ITA NO S. 1154 & 1155 / P N/ 20 12 ASSESSMENT YEAR S : 2007 - 08 & 2 008 - 09 SHRI GOPICHAND B. LALWANI, 250 - B TRIMURTI, E - WARD, NAGALA PARK, KOLHAPUR VS. DY. CIT, CENTRAL CIRCLE, KOLHAPUR (APPELLANT) (RESPONDENT) PAN NO. AAEPL3162A APPELLANT BY: SHRI M.K. KULKARNI RESPONDENT BY: MRS. M.S. VERMA DATE OF HEARING : 04 - 06 - 2014 DATE O F PRONOUNCEMENT : 25 - 06 - 2014 ORDER PER R.S. PADVEKAR, JM: - TH ESE TWO APPEALS ARE FILED BY THE ASSESSEE CHALLENGING THE IMPUGNED ORDER OF THE LD. CIT(A) - KOLHAPUR DATED 15 - 03 - 2012 FOR THE A.YS. 2007 - 08 & 2008 - 09. BOTH THESE APPEALS ARE ARISING OUT O F THE ASSESSMENT FRAMED U/S. 153A IN CONSEQUENCE OF THE SEARCH AND SEIZURE ACTION U/S. 132(1) OF THE INCOME - TAX ACT. 2. WE FIRST TAKE THE APPEAL FOR A.Y. 2007 - 08 BEING ITA NO. 1154/PN/2012 . GROUND NO. 1 IS IN RESPECT OF THE ADDITION SUSTAINED BY THE LD. CIT(A) ON ACCOUNT OF HOUSEHOLD EXPENSES. THE LD. COUNSEL SUBMITS THAT AS PER THE INSTRUCTION OF THE ASSESSEE HE IS NOT PRESSING GROUND NO. 1. AS GROUND NO. 1 IS NOT PRESSED, THE SAME IS DISMISSED. 3. THE NEXT ISSUE IS THE ADDITION OF RS.23,32,500/ - MADE BY THE ASSESSING OFFICER TOWARDS THE DIFFERENCE IN COST OF ACQUISITION OF IMMOVABLE PROPERTY U/S. 69B AND THIS ISSUE ARISES FROM GROUND NOS. 2 AND 3. THE FACTS WHICH ARE REVEALED FROM THE RECORD AS UNDER. AS OBSERVED BY THE ASSESSING OFFICER DURING THE COURSE OF SEARCH 2 ITA NO S. 1154 & 1155/PN/2012, SHRI GOPICHAND B. LALWANI, KOLHAPUR PROCEEDINGS AT THE RESIDENTIAL PREMISES OF THE ASSESSEE, CERTAIN LOOSE PAPERS WERE SEIZED. THE ASSESSING OFFICER HAS NOTED THAT ONE AGREEMENT TO SALE DATED 26 - 09 - 2003 IN RESPECT OF THE PROPERTY BEARING S. NO. 145/3 UCHAGAON, TAL. KARVEER, KOLHAPUR HAVING TOTAL AREA 0.16.26 R WAS ALSO SEIZED. IN RESPECT OF THE SAID PROPERTY SHRI SAMBHAJI BAPU NIGADE AND SHRI SHIVAJI BAPU NIGADE WERE SHOWN AS OWNERS AND THE SAID AGREEMENT WAS ON NON - JUDICIAL STAMP PAPER OF RS.20/ - . AS PER THE SAID AGREEMEN T THE RATE OF THE LAND WAS AGREED AT RS.1,80,000/ - PER GUNTHA (ARE). IT IS PERTINENT TO NOTE THAT THE ASSESSEE PURCHASED THE SAID PROPERTY FOR RS.4,87,5000/ - ON 23 - 11 - 2006. SO FAR AS THE AGREEMENT WHICH WAS SEIZED ON THE NON - JUDICIAL STAMP PAPER OF RS.20 / - , THE BUYER WAS SHOWN SOMEBODY ELSE. DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSEE PRODUCED SALE DEED OF THE SA ID PROPERTY AS WELL AS THE AGREEMENT FOR SALE BETWEEN HIMSELF AND SHRI SAMBHAJI BAPU NIGADE AND SHRI SHIVAJI BAPU NIGADE. AS PER T HE SALE DEED PRODUCED BY THE ASSESSEE , THE CONSIDERATION AGREED FOR PURCHASE OF THE PROPERTY ADMEASURING 16.25 ARE IS SHOWN AT RS.4,87,500/ - BUT IN THE COPY OF THE AGREEMENT TO SALE WHICH APPEARS TO BE BETWEEN THE OWNERS AND SOME THIRD PARTY , T HE VALUE OF THE PROPERTY WAS SHOWN AT RS.1,80,000/ - PER ARE. THE ASSESSING OFFICER, THEREFORE, WORKED OUT THE CONSIDERATION TOWARDS THE PURCHASE OF THE SAID PROPERTY AT RS.29,25,000/ - AND AFTER REDUCING RS.4,87,500/ - WHICH WAS DECLARED CONSIDERATION IN THE REGISTERED CONVEYANCE MADE THE ADDITION OF RS.23,32,500/ - , AFTER FURTHER REDUCING RS.1,05,500/ - WHICH WAS ALREADY MADE BY THE ASSESSING OFFICER IN RESPECT OF THE SAME PROPERTY ON THE BASIS OF DVOS REPORT. 4. IT IS PERTINENT TO NOTE HERE THAT THE ASSESSING OFFICER MADE THE REFERENCE U/S. 142A TO THE DEPARTMENTAL VALUATION OFFICER (DVO) TO DETERMINE THE COST OF THE PROPERTY IN THE HANDS OF THE ASSESSEE O N THE DATE OF ACQUISITION AS PER THE REGISTERED SALE DEED BETWEEN THE ASSESSEE AND THE NIGADE IN WHICH THE CONSIDER ATION WAS SHOWN AT RS.4,87,500/ - . 3 ITA NO S. 1154 & 1155/PN/2012, SHRI GOPICHAND B. LALWANI, KOLHAPUR THE DVO FURNISHED HIS VALUATION REPORT DATED 08 - 10 - 2009 AND ESTIMATED THE COST OF THE PROPERTY AT RS.5,93,000/ - . THE ASSESSING OFFICER, THEREFORE, MADE THE ADDITION OF RS.1,05,500/ - WHICH WAS THE DIFFERENCE BETWEEN THE C OST OF THE PROPERTY DETERMINED BY THE DVO AT RS.5,93,000/ - AND THE CONSIDERATION SHOWN IN THE SALE DEED BY THE ASSESSEE OF THE SAME PROPERTY AT RS.4,87,500/ - . THE ASSESSEE CHALLENGED THE ADDITION BEFORE THE LD. CIT(A) BUT WITHOUT SUCCESS. THE LD. CIT(A) CONFIRMED THE ADDITION AND THE OPERATIVE PART OF THE FINDING OF THE LD. CIT(A) IS AS UNDER: 19. IN RESPECT OF ACTION OF THE A. O. IN ADOPTING THE VALUE OF THE UCHAGAON PROPERTY AT RS.29,25,000/ - , AND THEREAFTER MAKING FURTHER ADDITION OF RS.23,32,500/ - IS CONCERNED, I FIND THAT THIS ADDITION IS MADE ON THE BASIS OF A DOCUMENT WHICH WAS AN AGREEMENT TO SALE ENTERED INTO BY THE SELLER OF THE PROPERTY SHRI SAMBHAJI BAPU NIGADE & SHRI SHIVAJI BAPU NIGADE WITH ONE SOU RANI RAVI CHANDWANI IN RESPECT OF THE SAME PROPERTY. THIS AGREEMENT IS DATED 26/09/2003. THIS IS AN INCRIMINATING DOCUMENT FOUND AT THE ASSESSEE'S PREMISES AND SEIZED THERE - FROM. THIS AGREEMENT TO SALE MENTIONS ABOUT THE SALE OF THE PROPERTY, WHICH CAN BE IDENTIFIED WITH THE PROPERTY PURCHASED BY THE APPELLANT. THE AGREEMENT ALSO MENTIONS THAT THE AMOUNT OF RS.1,00,000/ - AS ALSO GIVEN AS AN ADVANCE BY SOU RANI RAVI CHANDWANI. IN RESPECT OF THIS ADDITION, THE APPELLANT HAS ALSO STATED THAT THE DVO'S VALUE IS BINDING ON THE A.O. AND THAT THE SAME CAN NOT BE DISREGARDED IN FAVOUR OF THE VALUATION ARRIVED AT BY TAKING COGNIZANCE OF A DOCUMENT FOUND IN THE APPELLANT PREMISES. I DO NOT FIND MUCH FORCE IN THE APPELLANT'S CONTENTIONS. THE SEARCH AND SEIZURE ACTION HAD TAKEN PLACE IN THE CASE OF THE APPELLANT AND THIS DOCUMENT WHICH REVEALS THE DETAILED COST OF LAND PURCHASED BY THE APPELLANT CANNOT BE DISREGARDED. IT IS A WELL KNOWN FACT THAT MAXIMUM AMOUNT OF UNREPORTED, UNTAXED MONEY/INCOME, IS UTILIZED IN PURCHASING OF LAND OR REAL ESTATE. IT IS AN OPEN SECRET BUT NO ONE WILL ADMIT OF MAKING PAYMENT OF ANY AMOUNT OVER AND ABOVE WHAT IS RECORDED IN THE DOCUMENT. IN THE INSTANT CASE, THE DOCUMENT FOUND WITH THE APPELLANT REVEALS THAT UCHAGAON LAND HAD A GREATER VALUE THAN WHAT WAS SHOWN IN THE AGREEMENT TO SALE DT. 27/06/2003. THE CONTENT OF THIS DOCUMENT CANNOT BE DISREGARDED AND IT IS FOR THE 4 ITA NO S. 1154 & 1155/PN/2012, SHRI GOPICHAND B. LALWANI, KOLHAPUR APPELLANT TO PROVE WITH NECESSARY EVIDENCES THAT ITS CONTENTS ARE NOT TRUE OR THAT IT CANNOT BE RELIED UPON. SUCH AN ATTEMPT WAS NOT BEEN MADE EITHER AT THE ASSESSMEN T STAGE OR APPELLANT STAGE. THEREFORE, THE VALUATION ADOPTED BY TAKING INTO ACCOUNT THE VALUE OF LAND AS MENTIONED IN THE SEIZED MATERIAL IS CORRECT AND THUS NOT SUFFER FROM ANY INFIRMITY. THE ACTION OF THE A.O. IS CONFIRMED. AS FAR AS THE CONTENTION OF TH E APPELLANT THAT THE DVO'S VALUATION IS BINDING ON THE ASSESSING OFFICER IS CONCERNED, IT HAS BEEN HELD IN VARIOUS DECISIONS OF THE TRIBUNALS, H.CS. AND S.C. THAT THE VALUATION MADE BY THE DVO IS NOT BINDING ON THE A.O. THE VALUATION REPORT IS A PIECE OF E VIDENCE AND THE AUTHORITIES ARE FREE TO AGREE OR DISAGREE WITH THE VALUATION REPORT ON THE BASIS OF ANY OTHER EVIDENCE. IN THE RESULT, THE ADDITION MADE BY THE A.O. AMOUNTING TO RS. 23,32,500/ - IS CONFIRMED AND ACCORDINGLY GROUND NO. 5 FOR A. Y. 2007 - 08 IS DISMISSED. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS OF THE PARTIES AND PERUSED THE RECORD. THE LD. COUNSEL FILED THE COPY OF THE AGREEMENT TO SALE (ENGLISH TRANSLATION) WHICH WAS SEIZED FROM THE RESIDENCE OF THE ASSESSEE. ON EXAMINATION OF THE SAID COPY OF THE AGREEMENT IT IS SEEN THAT THE AGREEMENT IS ENTERED INTO BETWEEN ONE SOU RANI RAVI CHANDWANI AND ONE SHRI SAMBHAJI BAPU NIGADE AND SHRI SHIVAJI BAPU NIGADE AND DESCRIPTION OF THE PROPERTY IS SAME I.E. SURVEY NO. 145/3 UCHAGAON, TAL. KARVEER, KO LHAPUR AND TOTAL AREA IS SHOWN AS 65 R. ADMITTEDLY THE AGREEMENT IS NOT BETWEEN THE ASSESSEE AND THE OWNERS OF THE LAND . T HE SAID AGREEMENT WAS EXECUTED ON 26 - 09 - 2003 WHEREAS THE ASSESSEES AGREEMENT TO SALE IS 27 - 06 - 2003 WHICH WAS REGISTERED ON 23 - 11 - 20 06. IT IS SEEN THAT THE ASSESSING OFFICER DID NOT ISSUE ANY SUMMONS TO THE PERSON SHOWN IN THE AGREEMENT I.E. SOU RANI RAVI CHANDWANI EVEN IF THE ADDRESS OF THE PERSON IS GIVEN. THE ASSESSING OFFICER ALSO NOT EXAMINED THE ORIGINAL OWNERS OF THE LAND SOU RANI RAVI CHANDWANI AND SHRI SAMBHAJI BAPU NIGADE AND SHRI SHIVAJI BAPU NIGADE. THE ASSESSING OFFICER MADE DIFFERENCE TO THE DVO U/S. 142A OF THE ACT AND DVO DETERMINED THE VALUE OF THE SAID PROPERTY I.E. UCHAGAON 5 ITA NO S. 1154 & 1155/PN/2012, SHRI GOPICHAND B. LALWANI, KOLHAPUR PROPERTY AT RS.5,57,718/ - (THE ASSESSING OFFICER HAS MENTIONED THE DVO VALUATION FIGURE AT RS.5,93,000/ - ). THERE IS NO DISPUTE ABOUT THE FACT THAT THE ASSESSEE PURCHASED THE SAID PROPERTY AND AS PER THE REGISTERED SALE DEED THE CONSIDERATION WAS SHOWN AT RS.4,87,500/ - WHICH HAS ALSO UNDERGONE T HE PROCESS OF THE PAYMENT OF THE STAMP DUTY. THE ASSESSING OFFICER MADE THE ADDITION U/S. 69B . I N OUR OPINION THERE IS NO BASIS TO SUPPORT THE CASE OF THE ASSESSING OFFICER THAT THE ASSESSEE HAS ACTUALLY PAID RS.29,25,000/ - AS AGAINST RS.4,87, 5 00/ - . MER ELY ON THE BASIS OF THE COPY OF THE AGREEMENT TO SALE DEED IN WHICH THE ASSESSEE IS NOT A PARTY AND ANOTHER THE DOCUMENT IS REGISTERED AND WHICH IS SUBJECTED TO THE STAMP DUTY PROCESS BY THE COMPETENT AUTHORITY THEN THERE IS A DIFFERENT MECHANISM AND PROVI SION FOR DEALING WITH THE FAIR MARKET VALUE OF THE SALE CONSIDERATION OF THE PROPERTY MORE PARTICULARLY BY VIRTUE OF SEC. 50C OF THE ACT . MOREOVER, THE UNREGISTERED COPY OF THE AGREEMENT TO SALE IN WHICH THE ASSESSEE IS NOT THE PARTY AND THE ASSESSING OFF ICER HAS ALSO NOT EXAMINED THE OWNERS OF THE LAND CANNOT BE THE PIECE OF EVIDENCE TO MAKE THE ADDITIONS TO THE HANDS OF THE ASSESSEE. WE, THEREFORE, DELETE THE ADDITION OF RS.23,3 2 ,500/ - MADE BY THE ASSESSING OFFICER. WE MAKE IT CLEAR THAT THE ASSESSEE H AS NOT CHALLENGED THE ADDITION OF RS. 1,05,500/ - MADE BY THE ASSESSING OFFICER WHICH WAS IN RESPECT OF THE DIFFERENCE BETWEEN THE ESTIMATED COST OF THE PROPERTY BY THE DVO AT RS.5,93,000/ - AND SALE CONSIDERATION SHOWN IN THE REGISTERED SALE DEED AT RS.4,87 ,500/ - . IN THE RESULT, THE GROUND NOS. 2 AND 3 ARE ALLOWED. 6. THE NEXT ISSUE IS THE ADDITION OF RS.1,93,667/ - BASIS ON THE DVOS REPORT IN RESPECT OF THE IMMOVABLE PROPERTY SITUATED AT MAHALAXMI PLAZA, TARABAI PARK AND THIS ISSUE ARISES FROM GROUND NO. 4 WHICH IS AS UNDER: 4. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT(A) WAS NOT JUSTIFIED IN NOT ACCEPTING THE VALUATION OF COST OF ACQUISITION OF IMMOVABLE PROPERTY SITUATED AT MAHALAXMI 6 ITA NO S. 1154 & 1155/PN/2012, SHRI GOPICHAND B. LALWANI, KOLHAPUR PLAZA, TARABAI PARK AT RS.23,01,335/ - AND VALU ATION DONE BY DVO AT RS.24,95,000/ - AND THE DIFFERENCE BEING VERY MARGINAL THE LD. CIT(A) OUGHT TO HAVE ACCEPTED THE SAME INSTEAD OF SENDING IT BACK TO A.O. FOR VERIFICATION. THE ADDITION MADE OF RS.1,93,667/ - ON ACCOUNT OF MARGINAL DIFFERENCE IN VALUATIO N U/S. 69B BE DELETED. 7. THE FACT WHICH ARE REVEALED FROM THE RECORD AS UNDER. THE ASSESSING OFFICER HAS OBSERVED THAT DURING THE COURSE OF ASSESSMENT PROCEEDINGS IT IS SEEN THAT THE ASSESSEE HAS ACQUIRED THE PROPERTY BEING SURVEY NO. 221/1/1A, MA HALAXMI PLAZA, TARABAI PARK, KOLHAPUR HAVING TOTAL AREA OF 464.68 SQ. MTRS. AS NOTED BY THE ASSESSING OFFICER , THE SAID PROPERTY WAS ACQUIRED BY THE ASSESSE FOR RS.15,00,000/ - ON 09 - 12 - 1999 AND CONSTRUCTION ON THE SAID PROPERTY WAS MADE DURING F.YS. 2001 - 02, 2002 - 03, 2003 - 04 AND 2006 - 07. THE ASSESSING OFFICER MADE REFERENCE U/S. 142A OF THE INCOME - TAX ACT TO THE DVO TO DETERMINE THE INVESTMENT MADE BY THE ASSESSEE. THE DVO VIDE HIS VALUATION REPORT DATED 08 - 10 - 2009 HAS ESTIMATED THE COST OF THE CONSTRUCT ION AT RS. 24,95,000/ - . AS NOTED BY THE ASSESSING OFFICER THE DVO HAS NOT CONSIDERED THE COST OF THE LAND IN THE SAID VALUATION . T HE ASSESSE HAS SHOWN THE INVESTMENT IN THE SAID PROPERTY AT RS.23,01,335/ - AND THE DIFFERENCE IS TO THE EXTENT OF 7.76%. THE ASSESSING OFFICER, THEREFORE, MADE THE ADDITION OF RS.1,93,667/ - U/S. 69B OF THE ACT AND THE SAID ADDITION WAS CONFIRMED BY THE LD. CIT(A). NOW THE ASSESSEE IS IN APPEAL BEFORE US. 8. WE HAVE HEARD THE PARTIES AND PERUSED THE RECORD. ADMITTEDLY, THE DI FFERENCE BETWEEN THE VALUE DETERMINED BY THE DVO AND THE INVESTMENT DECLARED BY THE ASSESSEE WORKED OUT ONLY AT 7.76%. NOW AS PER THE RULES OF VALUATION UP TO 15% DIFFERENCE IS ACCEPTED UNDER THE S AFE - HARBOR R ULE. WE, THEREFORE, DELETE THE ADDITION MADE B Y THE ASSESSING OFFICER AND SUSTAINED BY THE LD. CIT(A). ACCORDINGLY, GROUND NO. 4 IS ALLOWED. 7 ITA NO S. 1154 & 1155/PN/2012, SHRI GOPICHAND B. LALWANI, KOLHAPUR 9. SO FAR AS THE GROUND NOS. 5 AND 6 ARE CONCERNED, AS PER THE INSTRUCTION OF THE ASSESSEE THE LD. COUNSEL HAS NOT PRESSED THOSE GROUNDS. AS THOSE GROUNDS A RE NOT PRESSED, THE SAME ARE DISMISSED AS NOT PRESSED. 10. NOW WE TAKE UP THE APPEAL FOR THE A.Y. 2008 - 09 BEING ITA NO. 1155/PN/2012. IN THIS APPEAL THE ASSESSEE HAS TAKEN AS MUCH AS THE 8 GROUNDS. THE LD. COUNSEL SUBMITS THAT AS PER THE INSTRUCTION OF THE ASSESSEE HE IS ONLY PRESSING GROUND NOS. 2 AND 3 AND HE IS NOT PRESS ING GROUND NOS. 1, 4, 5, 6, 7 AND 8. WE, ACCORDINGLY, ADJUDICATE THE GROUND NOS. 2 AND 3 AND DISMISSED ALL OTHER REMAINING GROUNDS. GROUND NO. 2 READS AS UNDER: 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT(A) WAS NOT JUSTIFIED IN CONFIRMING THE ADDITION OF RS.1,02,500/ - PERTAINING TO 50% SHARE OF THE APPELLANT IN THE PROPERTY PURCHASED AS BEING THE ADDITION MADE BY THE A.O. U/S. 69 ON ACCOUNT OF DIFFERENCE IN COST OF ACQUISITION AS RECORDED IN THE AUDITED BOOKS OF ACCOUNT SUPPORTED BY REGISTERED SALE DEED AND THE VALUATION MADE BY DVO U/S. 142A OF THE ACT. THE PROVISIONS OF S. 69 DO NOT APPLY TO THE FACTS OF THE CASE. THE DIFFERENCE BEING MARGINAL ONE BETWEEN C OST OF ACQUISITION AND DVO'S VALUATION THE SAME OUGHT TO HAVE BEEN DELETED. IN VIEW OF THIS THE ADDITION BE QUASHED. 11. THE ASSESSEE ACQUIRED THE FOLLOWING PROPERTY IN CO - OWNERSHIP IN THE A.Y. 2008 - 09 AND THE ASSESSEE IS HAVING SHARE IN THE SAID PROPER TY AND THE DESCRIPTION OF THE PROPERTY IS AS UNDER: 804/1 + 805/1, E WARD, KASABA BAVADA, KOLHAPUR TOTAL AREA 0.25.625 R THE TOTAL COST OF THE PROPERTY IS SHOWN AT RS.9,00,000/ - AND ASSESSEES SHARE BEING IS SHOWN AT RS.4,50,000/ - . THE SAID PROPERT Y WAS ACQUIRED ON 02 - 02 - 2008. THE ASSESSING OFFICER MADE THE REFERENCE TO THE DVO U/S. 142A OF THE ACT TO DETERMINE THE COST OF THE INVESTMENT OF THE SAID PROPERTY IN THE HANDS OF THE ASSESSEE ON THE DATE OF ACQUISITION. 8 ITA NO S. 1154 & 1155/PN/2012, SHRI GOPICHAND B. LALWANI, KOLHAPUR THE DVO FURNISHED HIS VALUATION R EPORT DATED 29 - 09 - 2009 AND ESTIMATED THE TOTAL COST OF THE PROPERTY AT RS.11,05,000/ - . THE ASSESSEE CONTENDED THAT THE DIFFERENCE IN THE VALUATION MADE BY THE DVO I.E. AT RS.11,05,000/ - AND THE COST OF THE ACQUISITION DECLARED AT RS.9,00,000/ - THE DIFFERE NCE WORKED OUT IS LESS THAN 15% AND HENCE, NO ADDITION IS REQUIRED. THE ASSESSING OFFICER REJECTED THE CONTENTION OF THE ASSESSEE BY HOLDING THAT THE DIFFERENCE IS MORE THAN 15 % AND HENCE, CONSIDERING THE SHARE OF THE ASSESSEE . T HE ASSESSING OFFICER, THEREFORE, MADE THE ADDITION OF RS.1,02,500/ - IN THE HANDS OF THE ASSESSEE U/S. 69B OF THE ACT TOWARDS THE UNACCOUNTED INVESTMENT. THE SAID ADDITION WAS CONFIRMED BY THE LD. CIT(A). 12. WE HAVE HEARD THE PARTIES. THE LD. COUNSEL SUBMITS THAT IN THE CA SE OF THE OTHER FAMILY MEMBERS THE IDENTICAL ADDITION WAS MADE AND THE SAME WAS DELETED BY THE HON'BLE TRIBUNAL. HE SUBMITS THAT THE ASSESSEE HAS MAINTAINED THE REGULAR BOOKS OF ACCOUNT IN WHICH THE INVESTMENT MADE IN THE PROPERTY IS SHOWN WHICH IS NOT DE TERMINED BY THE ASSESSING OFFICER. HE RELIED ON THE DECISION IN THE CASE OF SOU. DIVYA JAYRAM MEGHANI AND ORS. VS. DY. CIT, CENTRAL CIRCLE, KOLHAPUR BEING ITA NOS. 1134 TO 1139/PN/2012 ORDER DATED 29 - 10 - 2013. THE LD. COUNSEL ALSO FILED THE COPY OF THE DE CISION OF THE TRIBUNAL IN THE ABOVE CASES WHICH IS PLACED ON RECORD. IT IS SEEN THAT IN THE CASE OF SOU. DIVYA JAYRAM MEGHANI AND ORS. (SUPRA) THE IDENTICAL ISSUE HAS COME FOR THE CONSIDERATION BEFORE THE TRIBUNAL AND HAS HELD AS UNDER: 8 . THE GROUND NO. 2 IN RESPECT OF THE ADDITION ON THE BASIS OF THE DVO REPORT. IN THIS CASE THE BOOKS OF ACCOUNT OF THE ASSESSEE HAVE NOT BEEN REJECTED. THE ASSESSING OFFICER MADE ADDITION OF RS.2,28,000/ - ON THE BASIS OF THE DIFFERENCE IN VALUATION MADE BY DVO AND PURCH ASE CONSIDERATION IN RESPECT OF THE PROPERTY AT 1325/4, E WARD, UDYAM NAGAR, KOLHAPUR. WE FIND THAT THIS ISSUE STANDS COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF THE HON'BLE SUPREME COURT IN THE CASE OF SARGAM CINEMA VS. CIT 328 ITR 513 AS WELL A S THE DECISION OF THE HON'BLE HIGH COURT OF GUJARAT 9 ITA NO S. 1154 & 1155/PN/2012, SHRI GOPICHAND B. LALWANI, KOLHAPUR IN THE CASE OF GOODLUCK AUTOMOBILES (P.) LTD. VS. ACIT (2012) 26 TAXMANN. COM 254 (GUJ.). WE, THEREFORE, ALLOW THE GROUND NO. 2 AND DELET E THE ADDITION OF RS.2,28,000/ - . A CCORDINGLY , THE GROUND NO. 2 I S ALLOWED. 13. WE, THEREFORE, FOLLOWING THE DECISION IN THE CASE OF SOU. DIVYA JAYRAM MEGHANI AND ORS. (SUPRA) DELETE THE ADDITION AND ALLOW THE GROUND NO. 2. 14. THE GROUND NO. 3 READS AS UNDER. 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT(A) WAS NOT JUSTIFIED IN CONFIRMING THE ADDITION OF RS.2,16,500/ - PERTAINING TO 50% SHARE OF THE APPELLANT IN THE PROPERTY PURCHASED AS BEING THE ADDITION MADE BY THE A. 0. U/S 69 ON ACCOUNT OF DIFFERENCE IN COST OF ACQUISITION AS RECORDED IN TH E AUDITED BOOKS OF ACCOUNT SUPPORTED BY REGISTERED SALE DEED AND THE VALUATION MADE BY DVO U/S. 142A OF THE ACT. THE PROVISIONS OF S. 69 DO NOT APPLY TO THE FACTS OF THE CASE. THE DIFFERENCE BEING MARGINAL ONE BETWEEN COST OF ACQUISITION AND DVO'S VALUATIO N THE SAME OUGHT TO HAVE BEEN DELETED. IN VIEW OF THIS THE ADDITION BE QUASHED. 15. THE ASSESSEE HAS RAISED THE GRIEVANCE AGAINST THE ADDITION OF RS.2,16,500/ - AND THIS ISSUE ARISES FROM GROUND NO. 3. AS OBSERVED BY THE ASSESSING OFFICER THE ASSESSEE PUR CHASED THE FOLLOWING PROPERTY IN CO - OWNERSHIP HAVING SHARE DURING THE A.Y. 2008 - 09 AND THE DESCRIPTION OF THE PROPERTY IS AS UNDER: 804/1 + 805/1, E WARD, KASABA BAVADA, KOLHAPUR TOTAL AREA 1.28.125 R THE ASSESSEE HAS SHOWN THE COST OF ACQUISITION AT RS.42,50,000/ - AND ASSESSEES SHARE BEING IS DECLARED AT RS.21,25,000/ - . THE ABOVE PROPERTY WAS ACQUIRED ON 15 - 01 - 2008. THE ASSESSING OFFICER MADE THE REFERENCE TO THE DVO U/S. 142A OF THE ACT TO DETERMINE THE COST OF INVESTMENT IN THE HANDS OF THE AS SESSEE AS ON THE DATE OF ACQUISITION AND ON THE BASIS OF THE DVOS REPORT THE ASSESSING OFFICER MADE THE ADDITION 10 ITA NO S. 1154 & 1155/PN/2012, SHRI GOPICHAND B. LALWANI, KOLHAPUR TO THE EXTENT OF RS.2,16,500/ - . AS PER THE DVOS REPORT THE COST OF INVESTMENT IS RS.23,41,500/ - IN THE HANDS OF THE ASSESSEE (BEING SHARE) . T HE DVO ESTIMATED THE INVESTMENT IN THE SAID PROPERTY AT RS.46,83,000/ - AS AGAINST RS.42,50,000/ - DECLARED THE ASSESSEE AND HIS CO - OWNERS. ADMITTEDLY THE DIFFERENCE IS LESS THAN 15% I.E. 9.24% BETWEEN THE DVO VALUATION AND THE INVESTMENT DECLARED BY TH E ASSESSEE HENCE, APPLYING THE SAME S AFE - HARBOR R ULE IN OUR OPINION NO ADDITION IS JUSTIFIED AS IT IS LESS THAN 15%. MOREOVER, THE ASSESSING OFFICER HAS NOT REJECTED THE BOOKS OF ACCOUNT AND HENCE, THE PRINCIPLES LAID DOWN BY THE HON'BLE SUPREME COURT IN THE CASE OF SARGAM CINEMA VS. CIT 328 ITR 513 ARE SQUARELY APPLICABLE IN FAVOUR OF THE ASSESSEE HENCE, WE DELETE THE ADDITION MADE BY THE ASSESSING OFFICER AND CONFIRMED THE LD. CIT(A). ACCORDINGLY, GROUND NO. 3 IS ALLOWED. 16. IN THE RESULT, BOTH THE AP PEALS OF THE ASSESSEE ARE PARTLY ALLOWED. PRONOUNCED IN THE OPEN COURT ON 25 - 0 6 - 20 1 4 SD/ - SD/ - ( G.S. PANNU ) ( R.S. PADVEKAR ) ACCOUNTANT MEMBER JUDICIAL MEMBER RK /PS PUNE , DATED : 25 TH JUNE, 2014 COPY T O 1 ASSESSEE 2 DEPARTMENT 3 THE CIT(A), KOLHAPUR 4 THE CIT - II , KOLHAPUR 5 THE DR, ITAT, A BENCH, PUNE . 6 GUARD FILE. //TRUE COPY// BY ORDER PRIVATE SECRETARY INCOME TAX APPELLATE TRIBUNAL PUNE