K.M.Srinivas Murthy , Bangalore V. The Assistant Commissioner of Income Tax Circle-7(2)(1), Bangalore

ITA 334/BANG/2019

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 5003 (ITAT-BANGALORE)
• Duration Of Justice: 3 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-05-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 16-05-2019
• Assessment Year: 2013-2014
• Appeal Filed On: 25-02-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: TSHERING ONGDA
• Keywords: Sale consideration of property below Jantri Value; Cost of acquisition
• Section: 56(2)(vii)(b); 56(2); 234B; 56

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC-A BENCH : BANGALORE BEFORE SHRI ARUN KUMAR GARODIA, ACCOUNTANT MEMBER ITA NO. 334 /BANG/201 9 ASSESSMENT YEAR : 201 3 - 1 4 SHRI K.M. SRINIVAS MURTHY, NO. 5/25, 3 RD CROSS, 1 ST BLOCK, JAYANAGAR, BANGALORE 560 011. PAN: ALLPS6362F VS. THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 7 (2) (1), BANGALORE. APPELLANT RESPONDENT ASSESSEE BY : SMT. SUMAN LUNKAR, CA RE VENUE BY : SHRI TSHERING ONGDA, JCIT (DR) DATE OF HEARING : 15.05 .201 9 DATE OF PRONOUNCEMENT : 31 .05 .201 9 O R D E R PER SHRI A.K. GARODIA, ACCOUNTANT MEMBER THIS APPEAL IS FILED BY THE ASSESSEE AND THE SAME IS DIRECTED AGAINST THE ORDER OF LD. CIT (A)-10, BANGALORE DATED 01.03.2018 FOR ASSESSMENT YEAR 2013-14. 2. THE GROUNDS RAISED BY THE ASSESSEEARE AS UNDER. 1. THE LEARNED ASSESSING OFFICER HAD ERRED IN HOLDING THAT THE PROVISION OF SECTION 56(2) ISAPPLICABLE IN CASE OF THE APPELLANT AND IN MAKING AN ADDITION OF RS. 31,12,580/- TO THEINCOME OF THE APPELLANT. THE PROVISIONS OF SECTION 56 HAVING NOT APPLICABLE TO THE CASE OFTHE APPELLANT, THE ADDITIONS AS MADE IS NOT JUSTIFIED AND IS REQUIRED TO BE DELETED. 2. THE LEARNED CIT(A) WAS ALSO ERRED IN HOLDING THAT THE DIFFERENCE BETWEEN STAMP VALUE OFTHE PROPERTY AND ACTUAL VALUE OF PROPERTY IS TO BE TREATED AS INCOME BY APPLYING PROVISIONSU/S. 56(2)(VII)(B) OF THE I.T. ACT, 1961. 3. THE PROVISION U/S, 56(2) (VII) (B) IS NOT APPLICABLE TO THE CASE OF THE APPELLANT, THE ADDITIONAS SUSTAINED IS TO BE DELETED. 4. IN ANY CASE AND WITHOUT PREJUDICE, THE ADDITION IS ERRONEOUS AND EXCESSIVE. 5. THE APPELLANT ALSO DENIES LIABILITY TO PAY INTEREST U/S. 234B OF THE ACT. THE INTEREST HAVINGBEEN LEVIED ERRONEOUSLY ARE TO BE DELETED. 6. IN VIEW OF THE ABOVE AND ON OTHER GROUNDS TO BE ADDUCED AT THE TIME OF HEARING, IT ISREQUESTED THAT THE IMPUGNED ORDER BE QUASHED OR AT LEAST THE ADDITION OF RS. 31,12,580/- ASMADE TO INCOME TO BE DELETED AND INTEREST LEVIED TO BE DELETED. ITA NO.334/BANG/2019 PAGE 2 OF 3 3. IT WAS SUBMITTED BY LD. AR OF ASSESSEE THAT THE ADDITION IS MADE BY THE AO BY INVOKING THE PROVISIONS OF SECTION 56(2)(VII)(B) OF IT ACT. THEREAFTER THE ASSESSEE POINTED OUT THAT AS PER PARA 3 OF THE ASSESSMENT ORDER, THE AO HAS MADE ADDITION OF RS. 31,12,580/- ON THIS BASIS THAT THERE IS DIFFERENCE IN THE AMOUNT AS PER GUIDANCE VALUE AND ACTUAL PURCHASE COST. SHE ALSO SUBMITTED THAT THE AO HAS STATED IN PARA 3 OF THE ASSESSMENT ORDER THAT IT WAS BROUGHT TO THE NOTICE OF THE ASSESSEES AR TO ADD BACK THE DIFFERENCE OF RS. 31,12,580/- FOR WHICH ASSESSEES AR AGREED. SHE SUBMITTED THAT AS PER SECTION 56(2)(VII)(B) OF IT ACT BEFORE AMENDMENT BY FINANCE ACT, 2013 W.E.F. 01.04.2014, THE ADDITION COULD HAVE BEEN MADE IF ANY IMMOVABLE PROPERTY WAS RECEIVED WITHOUT CONSIDERATION AND FOR THAT PURPOSE, THE STAMP DUTY VALUE COULD HAVE BEEN ADOPTED AND ONLY AS PER THIS AMENDMENT BY FINANCE ACT, 2013 W.E.F. 01.04.2014, THIS WAS PROVIDED THAT IF ANY IMMOVABLE PROPERTY IS ACQUIRED FOR A CONSIDERATION WHICH IS LESS THAN THE STAMP DUTY VALUE OF THE PROPERTY BY AN AMOUNT EXCEEDING FIFTY THOUSAND RUPEES, THE STAMP DUTY VALUE OF SUCH PROPERTY AS EXCEEDS SUCH CONSIDERATION CAN BE ADDED. SHE SUBMITTED THAT IN PRESENT CASE, ASSESSMENT YEAR INVOLVED IS 2013-14 AND THEREFORE, PRE AMENDED PROVISIONS ARE APPLICABLE AND AS PER THE SAME, THE ADDITION CANNOT BE MADE IN THE PRESENT CASE. SHE ALSO POINTED OUT THAT EVEN IF THE ASSESSEES AR HAS AGREED BEFORE THE AO FOR THIS ADDITION, THIS ADDITION IS NOT JUSTIFIED BECAUSE THE SAME IS NOT AS PER LAW. THE LD. DR OF REVENUE SUPPORTED THE ORDERS OF AUTHORITIES BELOW. HE ALSO SUBMITTED THAT ONCE THE AR OF ASSESSEE AGREED BEFORE THE AO, THE ADDITION MADE BY THE AO SHOULD BE CONFIRMED. 4. I HAVE CONSIDERED THE RIVAL SUBMISSIONS. FIRST OF ALL, I REPRODUCE THE PROVISIONS OF SECTION 56(2)(VII)(B) AS IT APPEARED IN THE STATUE BOOK BEFORE THE AMENDMENT BY FINANCE ACT, 2013 AND BELOW THAT, I ALSO REPRODUCE THE PROVISIONS OF SECTION 56(2)(VII)(B) AFTER THAT AMENDMENT. THE SAME ARE AS UNDER. PRE AMENDMENT 56(2)(VII)(B) ANY IMMOVABLE PROPERTY, WITHOUT CONSIDERATION, THE STAMP DUTY VALUE OF WHICHEXCEEDS FIFTY THOUSAND RUPEES, THE STAMP DUTY VALUE OF SUCH PROPERTY; ITA NO.334/BANG/2019 PAGE 3 OF 3 POST AMENDMENT 56(2) (VII) (B) ANY IMMOVABLE PROPERTY, (I) WITHOUT CONSIDERATION, THE STAMP DUTY VALUE OF WHICH EXCEEDS FIFTY THOUSAND RUPEES, THE STAMP DUTY VALUE OF SUCH PROPERTY; (II) FOR A CONSIDERATION WHICH IS LESS THAN THE STAMP DUTY VALUE OF THE PROPERTY BY AN AMOUNT EXCEEDING FIFTY THOUSAND RUPEES, THE STAMP DUTY VALUE OF SUCH PROPERTY AS EXCEEDS SUCH CONSIDERATION: PROVIDED THAT WHERE THE DATE OF THE AGREEMENT FIXING THE AMOUNT OF CONSIDERATION FOR THE TRANSFER OF IMMOVABLE PROPERTY AND THE DATE OF REGISTRATION ARE NOT THE SAME, THE STAMP DUTY VALUE ON THE DATE OF THE AGREEMENT MAY BE TAKEN FOR THE PURPOSES OF THIS SUB-CLAUSE: PROVIDED FURTHER THAT THE SAID PROVISO SHALL APPLY ONLY IN A CASE WHERE THE AMOUNT OF CONSIDERATION REFERRED TO THEREIN, OR A PART THEREOF, HAS BEEN PAID BY ANY MODE OTHER THAN CASH ON OR BEFORE THE DATE OF THE AGREEMENT FOR THE TRANSFER OF SUCH IMMOVABLE PROPERTY; 5. AS PER THE ABOVE PROVISIONS OF SECTION 56(2)(VII)(B) AS IT APPEARED IN THE STATUE BOOK IN THE RELEVANT ASSESSMENT YEAR, THE ADDITION MADE BY THE AO IS NOT JUSTIFIED EVEN IF THE LD. AR OF ASSESSEE HAS AGREED TO THIS ADDITION IN COURSE OF ASSESSMENT PROCEEDINGS BECAUSE SUCH ADDITION IS NOT AS PER LAW. THEREFORE, I DELETE THE SAME. 6. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THE DATE MENTIONED ON THE CAPTION PAGE. SD/- (ARUN KUMAR GARODIA) ACCOUNTANT MEMBER BANGALORE, DATED, THE 31 ST MAY, 2019. /MS/ COPY TO: 1. APPELLANT 4. CIT(A) 2. RESPONDENT 5. DR, ITAT, BANGALORE 3. CIT 6. GUARD FILE BY ORDER ASSISTANT REGISTRAR, INCOME TAX APPELLATE TRIBUNAL, BANGALORE.