The ITO, Ward-3(1), Surat V. Shri Vijay Natwarlal Gandhi, Surat

ITA 3400/AHD/2009

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 6470 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 5 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-06-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2006-2007
• Appeal Filed On: 24-12-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUMIR TEKRIWALA
• Keywords: Unexplained investment; Sale consideration of property below Jantri Value
• Section: 50C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH B BEFORE SHRI T. K. SHARMA, JUDICIAL MEMB ER AND SHRI A. K. GARODIA, ACCOUNTANT MEMBER I.T.A. NO.3400 / AHD/2009 (ASSESSMENT YEAR 2006-07) ITO, WARD 3(1), SURAT VS. SHRI VIJAY NATWARLAL GANDHI, 47, SEEMA ROW HOUSE, CHOD DOD ROAD, SURAT PAN/GIR NO. : ABGPG4798N (APPELLANT) .. (RESPONDENT) APPELLANT BY: SHRI SUMIR TEKRIWALA, SR. DR RESPONDENT BY: WRITTEN SUBMISSION. ORDER PER SHRI A. K. GARODIA, AM:- THIS APPEAL BY THE REVENUE HAS BEEN PREFERRED AGAI NST THE ORDER DATED 30.09.2009 OF CIT(A) II, SURAT, FOR THE ASSES SMENT YEAR 2006-07. 2. THE GROUNDS OF APPEAL RAISED BY THE REVENUE ARE AS UNDER: 1) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION MADE ON ACCOUNT OF UNEXPLAINED INVESTMENT U/S. 69B OF THE ACT OF RS. 1 7,38,950. 2) ON THE FACTS AND IN THE CIRCUMSTANCES OF T HE CASE, THE LEARNED CIT (A) OUGHT TO HAVE UPHELD THE ORDER OF THE ASSES SING OFFICER, 3) IT IS, THEREFORE, PRAYED THAT THE ORDER OF THE CIT(A) MAY BE SET-ASIDE AND THAT OF ASSESSING OFFICER MAY BE REST ORED TO THE ABOVE EXTENT. 3. THE BRIEF FACTS OF THE CASE ARE THAT IT IS NOTED BY THE A.O. IN THE ASSESSMENT ORDER THAT THE ASSESSEE HAS PURCHASED A FLAT FOR RS.13.05 LACS AND PAID ADDITIONAL STAMP DUTY ON THE PROPERTY. TH E A.O. HAD ISSUED A I.T.A.NO. 3400 /AHD/2009 2 SHOW CAUSE NOTICE TO THE ASSESSEE ASKING THE ASSESS EE TO EXPLAIN AS TO WHY THE VALUE OF THE PROPERTY AS PER STAMP DUTY VAL UATION OF RS.30,43,950/- SHOULD NOT BE CONSIDERED AS MARKET V ALUE AND REAL VALUE OF THE PROPERTY AND DIFFERENCE MAY BE TREATED AS UN EXPLAINED INVESTMENT U/S 69B OF THE INCOME TAX ACT, 1961. THE ASSESSEE SUBMITTED REPLY BEFORE THE A.O. AND RAISED VARIOUS CONTENTIONS AND PLACED RELIANCE ON VARIOUS JUDGMENTS BUT THE A.O. WAS NOT SATISFIED AN D HE HELD THAT THE ASSESSEE HAS MADE INVESTMENT BUT NOT RECORDED THE C ORRECT VALUE OF INVESTMENT IN HIS BOOKS OF ACCOUNTS AND THE SOURCE OF EXTRA INVESTMENT HAS NOT BEEN EXPLAINED BY THE ASSESSEE. THE A.O. M ADE ADDITION OF THE DIFFERENCE AMOUNT OF RS.17,38,950/- U/S 69B OF THE INCOME TAX ACT, 1961. BEING AGGRIEVED, THE ASSESSEE CARRIED THE MA TTER IN APPEAL BEFORE THE CIT(A) WHO HAS DELETED THIS ADDITION BY FOLLOWI NG THE TRIBUNAL ORDER RENDERED IN THE CASE OF BHARAT KUMAR N. PATEL VS AC IT IN I.T.A. NO. 1749/AHD/2008 DATED 29.08.2008. NOW, THE REVENUE I S IN APPEAL BEFORE US. 4. LD. D.R. PLACED RELIANCE ON THE ASSESSMENT ORDER WHEREAS NONE WAS APPEARING ON BEHALF OF THE ASSESSEE BUT A WRITT EN SUBMISSION OF THE LD. A.R. OF THE ASSESSEE M/S. BAKUL SHAH & CO. DATE D 13 TH FEB 2010 IS AVAILABLE ON RECORD AND HENCE WE DECIDE THIS APPEAL AFTER CONSIDERING THESE WRITTEN SUBMISSIONS OF THE LD. A.R. OF THE AS SESSEE. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS, PERUSE D THE MATERIAL ON RECORD AND HAVE G ONE THROUGH THE ORDERS OF AUTHORI TIES BELOW. WE FIND THAT THE A.O. HAS MADE THE ADDITION SIMPLY ON THE B ASIS OF VALUE OF PROPERTY AS PER STAMP DUTY VALUATION WITHOUT BRINGI NG ANY ADVERSE MATERIAL ON RECORD TO SHOW AND ESTABLISH THAT THE A SSESSEE HAS IN FACT MADE ANY EXTRA INVESTMENT AND MADE ANY EXTRA PAYMEN T FOR THE PURPOSE OF PURCHASE OF THIS FLAT. IN THE WRITTEN SUBMISSIO NS SUBMITTED BY THE LD. A.R. OF THE ASSESSEE, RELIANCE HAS BEEN PLACED ON T HE VARIOUS JUDICIAL I.T.A.NO. 3400 /AHD/2009 3 PRONOUNCEMENTS INCLUDING THE TRIBUNAL DECISION OF A HMEDABAD BENCH OF THE TRIBUNAL RENDERED IN THE CASE OF SHRI BHARAT KU MAR N. PATEL IN I.T.A. NO. 1749/AHD/2008. ALTHOUGH THE COPY OF THIS TRIBU NAL DECISION IS NOT MADE AVAILABLE BEFORE US BUT RELEVANT PARAGRAPH OF THE SAME HAS BEEN REPRODUCED IN THE WRITTEN SUBMISSION FILED BY THE L D. A.R. OF THE ASSESSEE. AS PER THE SAME, IN THAT CASE, IT WAS HE LD BY THE TRIBUNAL THAT SECTION 50C OF THE INCOME TAX ACT, 1961 IS APPLICAB LE TO THE SELLER AND IT PROVIDES THAT VALUATION MADE BY THE STAMP VALUATION AUTHORITY IS TO BE DEEMED AS THE CONSIDERATION RECEIVED BY THE SELLER. IN THAT CASE, IT WAS HELD BY THE LD. CIT(A) THAT THE CONVERSE WILL ALSO HAVE TO BE ACCEPTED AS TRUE, I.E. THE VALUATION OF THE STAMP VALUATION AUT HORITY WILL HAVE TO BE DEEMED AS THE CONSIDERATION PAID BY THE PURCHASER O F THE PROPERTY AS WELL. IT WAS HELD BY THE TRIBUNAL IN THAT CASE THA T THE BENCH DO NOT AGREE WITH THIS ANALOGY DRAWN BY THE LD. CIT(A) BECAUSE H AD THE LEGISLATION INTENDED SO, IT COULD HAVE EASILY SPECIFIED SUCH A PROPOSITION IN THE PROVISION ITSELF. IN THE PRESENT CASE ALSO, THE A. O. HAS SIMPLY ADOPTED THE VALUATION OF STAMP VALUATION AUTHORITY AND HELD THA T EXTRA PURCHASE CONSIDERATION WAS PAID BY THE ASSESSEE WITHOUT BRIN GING ANY OTHER ADVERSE MATERIAL ON RECORD AND HENCE, BY RESPECTFUL LY FOLLOWING THIS TRIBUNAL DECISION, WE CONFIRM THE ORDER OF LD. CIT( A) ON THIS ISSUE BECAUSE HE HAS ALSO FOLLOWED THE SAME TRIBUNAL DECI SION TO DELETE THE ADDITION MADE BY THE A.O. 6. IN THE RESULT, APPEAL OF THE REVENUE STANDS DISM ISSED. 7. ORDER PRONOUNCED IN THE OPEN COURT ON 08 TH JUNE 2011. SD./- SD./- (T. K. SHARMA) (A. K. GARODIA) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD; DATED : 08 TH JUNE, 2011 SP I.T.A.NO. 3400 /AHD/2009 4 COPY OF THE ORDER FORWARDED TO: 1. THE APPLICANT 2. THE RESPONDENT 3. THE CIT CONCERNED 4. THE LD. CIT (APPEALS) 5. THE DR, AHMEDABAD 6. THE GUARD FILE 1. DATE OF DICTATION 8/6/11 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 8/6/11 OTHER MEMBER 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P .S./P.S. 8/6/11 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 8/6/11 5. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. P.S./P.S. 9/6/11 6. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 9/6/11 7. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK .. 8. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER . 9. DATE OF DESPATCH OF THE ORDER. ..