The ACIT, Circle-2, Surat V. Shri Dharmesh P.Patel, Surat

ITA 2217/AHD/2009

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 6241 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 11 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-06-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 23-06-2011
• Assessment Year: 2006-2007
• Appeal Filed On: 16-07-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ALBINUS TIRKEY
• Keywords: Sale consideration of property below Jantri Value
• Section: 50C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, AHMEDABAD A BENCH, (BEFORE SHRI G. D. AGARWAL, VP AND BHAVNESH SAINI, JM) ITA NO.2217/AHD/2009 A. Y.: 2006-07 THE A. C. I. T., CIRCLE-2, ROOM NO.110, 1 ST FLOOR, AAYAKAR BHAVAN, MAJURA GATE, SURAT VS SHRI DHARMESH P. PATEL, 7, GREEN HOUSE, KAILASH NAGAR, SAGRAMPURA, SURAT PA NO. ABGPP 6255 P (APPELLANT) (RESPONDENT) FOR DEPARTMENT: SHRI ALBINUS TIRKEY, DR FOR ASSESSEE: NONE O R D E R PER BHAVNESH SAINI: THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF THE LEARNED CIT (A)- II, SURAT DATED 13-04-2009, FOR ASSESSMENT YEAR 2006-07, CHALLENGIN G THE DELETION OF ADDITION OF RS.30,47,800/- U/S 69B OF THE IT ACT. 2. BRIEFLY, THE FACTS OF THE CASE ARE THAT THE LEAR NED CIT(A) NOTED IN THE IMPUGNED ORDER THAT THE ASSESSEE HAD PURCHAS ED SIX PROPERTIES WHICH INCLUDED OFFICE PREMISES, 4 SHOPS AND PLOT OF LAND. FROM THE COPIES OF REGISTERED SALE DEEDS PRODUCED B Y THE ASSESSEE, THE AO NOTED THAT SVA (STAMP VALUATION AUTHORITY) HAS ADOPTED THE VALUE OF RS.38,15,800/- FOR THE OFFICE PREMISES AT ABHUSHAN ITA NO.2217/AHD/2009 ACIT, CIRCLE-2, SURAT VS SHRI DHARMESH P. PATEL 2 APARTMENT AND RS.18,72,000/- FOR THE LAND AT RUNDH AS AGAINST THE PURCHASE CONSIDERATION OF RS.21,00,000/- AND RS.5,4 0,000/- SHOWN BY THE ASSESSEE. WHEN ASKED TO EXPLAIN WHY THE DIFF ERENTIAL SUMS OF RS.17,15,800/- AND RS.13,32,000/-, TOTALLING TO RS. 30,47,800/- SHOULD NOT BE TREATED AS UNDISCLOSED INVESTMENT OF THE ASS ESSEE U/S 69B OF THE IT ACT, THE ASSESSEE SUBMITTED THAT HE HAD NOT PAID ANY SUM IN EXCESS OF WHAT HAS BEEN SHOWN IN THE SALE/PURCHASE DEEDS. THE AO HOWEVER, REJECTED THE CONTENTION OF THE ASSESSEE AN D MADE THE ADDITION. IT WAS SUBMITTED BEFORE THE LEARNED CIT(A ) THAT PROVISIONS OF SECTION 50C OF THE IT ACT CANNOT BE APPLIED IN THE CASE OF PURCHASER BECAUSE IT IS APPLICABLE FOR CAPITAL GAIN ONLY. THE ASSESSEE RELIED UPON THE ORDER OF THE ITAT AHMEDABAD BENCH IN THE C ASE OF BHARATKUMAR N. PATEL VS ACIT, CIR-3, SURAT DATED 29 -08-2008 IN ITA NO. 1749/AHD/2008 IN WHICH THE TRIBUNAL DELETED SIM ILAR ADDITION. THE LEARNED CIT(A) FOLLOWING THE ORDER OF THE TRIBUNAL DELETED THE ADDITION. 3. THE LEARNED DR RELIED ON THE ORDER OF THE AO. HO WEVER, NONE APPEARED ON BEHALF OF THE ASSESSEE DESPITE SERVICE OF NOTICE. 4. ON CONSIDERATION OF THE ABOVE FACTS, WE DO NOT F IND ANY MERIT IN THE DEPARTMENTAL APPEAL. THE AO MERELY ON THE BASIS OF PAYMENT OF ADDITIONAL STAMP DUTY WORKED OUT THE EXCESS CONSIDE RATION AND MADE THE ADDITION. THE AO HAS NOT BROUGHT ANY EVIDENCE O R MATERIAL ON RECORD TO SHOW THAT THE ASSESSEE HAS PAID ANY AMOUN T OVER AND ABOVE WHAT IS MENTIONED IN THE TITLE DEED. THE LEAR NED CIT(A) RIGHTLY RELIED UPON THE DECISION OF ITAT AHMEDABAD BENCH I N THE CASE OF ITA NO.2217/AHD/2009 ACIT, CIRCLE-2, SURAT VS SHRI DHARMESH P. PATEL 3 BHARAT N. PATEL (SUPRA) IN WHICH SIMILAR ADDITION H AS BEEN DELETED. FURTHER, ITAT AHMEDABAD BENCH IN THE CASE OF ITO VS VENU PROTEINS INDUSTRIES 4 ITR (TRIB.) 602 HELD AS UNDER : THE ASSESSEE PURCHASED A PLOT OF LAND AND A BUILDING AT A COST OF RS.21,00,000 AND PAID A STAMP DUTY AMOUNTING TO RS.1,76,400. HOWEVER, THE CONCERNED AUTHORITY CHARGED AN ADDITIONAL STAMP DUTY OF RS.66,612 VALUING THE PROPERTY AT RS.28,93,000. THE ASSESSING OFFICER REOPENED THE ASSESSMENT AND REJECTED THE CONTENTION OF THE ASSESSEE THAT PROVISIONS OF SECTION 50C OF THE INCOME-TAX ACT, 1961, WERE NOT APPLICABLE IN THE CA SE OF THE ASSESSEE, CONCLUDED THAT THE ASSESSEE HAD UNDERVALUED THE PROPERTY BY AN AMOUNT OF RS.7,93,000 AND MADE THE ADDITION. THE COMMISSIONER (APPEALS) DELETED THE ENTIRE ADDITION HOLDING THAT APPLICABILITY OF SECTION 50C WAS PRIMA FACIE INCORRECT AS IT PERTAINED TO CHARGING OF CAPI TAL GAINS WHICH WAS TO BE CONSIDERED IN THE HANDS OF TH E SELLER. ON APPEAL BY THE DEPARTMENT: HELD, DISMISSING THE APPEAL, THAT THERE WAS NO INFIRMITY IN THE ORDER OF THE COMMISSIONER (APPEALS ). 4.1 CONSIDERING THE FACTS OF THE CASE AND THAT THE ASSESSEE IS A PURCHASER AND THAT PROVISIONS OF SECTION 50C OF THE IT ACT WOULD NOT BE APPLICABLE IN THE HANDS OF THE PURCHASER AND FUR THER THE AO HAS NOT BROUGHT ANY EVIDENCE ON RECORD IN SUPPORT OF TH E FINDINGS GIVEN, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LE ARNED CIT(A) FOR DELETING THE ADDITION. WE CONFIRM HIS FINDINGS AND DISMISS THE APPEAL OF THE REVENUE. ITA NO.2217/AHD/2009 ACIT, CIRCLE-2, SURAT VS SHRI DHARMESH P. PATEL 4 5. IN THE RESULT, THE DEPARTMENTAL APPEAL IS DISMIS SED. ORDER PRONOUNCED ON 30-06-2011. SD/- SD/- (G. D. AGARWAL) VICE PRESIDENT (BHAVNESH SAINI) JUDICIAL MEMBER DATE : 30/06/2011 LAKSHMIKANT/- COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT CONCERNED 4. THE CIT(A) CONCERNED 5. THE DR, ITAT, 6. GUARD FILE BY ORDER //TRUE COPY// DY.R/AR, I TAT, AHMEDABAD