Sh. Jitender Lohani, New Delhi V. ACIT, New Delhi

ITA 4263/DEL/2014

• Counselvise Citation: 426320114 RSA 2014
• Duration Of Justice: 1 year(s) 2 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-11-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC 2
• Next Hearing Date: 05-08-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 05-08-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MRS RAKHI VIMAL
• Assessee Lawyers: US AGGARWAL
• Keywords: Sale consideration of property below Jantri Value; Gift; Salary income; Fair market value
• Section: 50C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES : SMC-II : NEW DELHI BEFORE SHRI J. SUDHAKAR REDDY, ACCOUNTANT MEMBER ITA NO.4263/DEL/2014 ASSESSMENT YEAR : 2008-09 JITENDER LOHANI, B-11, IIND FLOOR, GUJRAWALA TOWN, PART-1, NEW DELHI. PAN: AACPL6291J VS. ACIT, CIRCLE-20(1), NEW DELHI. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI U.S. AGGARWAL, ADVOCATE DEPARTMENT BY : MRS. RAKHI VIMAL, JCIT DATE OF HEARING : 13. 08.2015 DATE OF PRONOUNCEMENT : 04.11.2015 ORDER THIS IS AN APPEAL BY THE ASSESSEE DIRECTED AGAINST THE ORDER OF THE CIT(A)-XXII, NEW DELHI, DATED 7.4.2014 FOR THE ASSE SSMENT YEAR 2008- 09. ITA NO.4263/DEL/2014 2 2. THE ASSESSEE IS AN INDIVIDUAL AND DERIVES INCOME FROM SALARY, HOUSE PROPERTY AND REMUNERATION FROM A PARTNERSHIP FIRM. DURING THE YEAR, THE ASSESSEE PURCHASED TWO PLOTS IN SECTOR 18, SANPADA, NAVI MUMBAI ON 3.7.2007 FOR RS.25,41,000/-. AS PER REGISTERED PUR CHASE DEED FILED, THE MARKET VALUE OF THE PROPERTY HAS BEEN SHOWN AS RS.3 8,22,000/- BY THE REGISTERING AUTHORITY FOR THE PURPOSE OF CHARGE OF STAMP DUTY. THE AO ADDED THE DIFFERENCE OF RS.12,81,000/- AS UNEXPLAIN ED INVESTMENT U/S 69B. AGGRIEVED, THE ASSESSEE CARRIED THE MATTER BE FORE THE FIRST APPELLATE AUTHORITY WITHOUT SUCCESS. FURTHER AGGRIEVED, THE ASSESSEE IS BEFORE US. 3. AFTER HEARING THE RIVAL CONTENTIONS, WE FIND THA T THE REVENUE HAS NO MATERIAL WHATSOEVER TO HOLD THAT THE ASSESSEE HAS I NVESTED MORE THAN RS.25,41,000/- FOR THE PURCHASE OF THE ABOVE PROPER TY. SECTION 50C CAN BE INVOKED ONLY IN THE CASE OF COMPUTATION OF CAPIT AL GAINS UNDER CHAPTER XIV. SECTION 50C CANNOT BE INVOKED FOR APPLYING SE CTION 69B OF THE ACT. THE HONBLE DELHI HIGH COURT IN THE CASE OF CI T VS. KHOOBSURAT RESORTS (P) LTD. IN ITA NO.776 OF 2011 VIDE ITS JUD GMENT DATED 5 TH NOVEMBER, 2012, HAS HELD THAT THE FICTION CREATED B Y VIRTUE OF SECTION 50C APPLIES ONLY IN RESPECT OF ESCAPED INCOME OF A SELLER, FOR THE ITA NO.4263/DEL/2014 3 DETERMINATION OF THE TRUE CAPITAL GAIN. IT CANNOT BE INVOKED BY THE REVENUE UNLESS THERE IS AN UNDERSTATEMENT OF CONSID ERATION IN RESPECT OF THE TRANSFER AND THE BURDEN OF SHOWING THAT THERE I S SUCH UNDERSTATEMENT IS ON THE REVENUE FOR APPLYING THE PROVISION ON THE PURCHASER. 4. THE HONBLE ALLAHABAD HIGH COURT IN THE CASE OF CIT VS. SMT. RAJ KUMARI VIMLA DEVI & ANR. (2005) 279 ITR 360 (ALL), HELD AS FOLLOWS:- VALUE OF PROPERTIES FOR STAMP DUTY PURPOSES CANNOT BE TREATED AS FAIR MARKET VALUE, AND THEREFORE, THE DIFFERENCE BETWEEN THE SAID AMOUNT AND THE SALE CONSIDERATION CANNOT BE CHARGED TO TAX AS DEEMED GIFT. 5. THE HONBLE DELHI HIGH COURT IN ITA NO.343 OF 20 12, IN THE CASE OF CIT VS. SADHNA GUPTA, VIDE ITS JUDGMENT DATED 6. 3.2013, AT PARA 5, HAS HELD AS FOLLOWS:- 5. THE LAW SEEMS TO BE WELL SETTLED THAT UNLESS AN D UNTIL THERE IS SOME OTHER EVIDENCE TO INDICATE THAT EXTRA CONSIDER ATION HAD FLOWED IN THE TRANSACTION OF PURCHASE OF PROPERTY, THE REPORT OF THE DVO CANNOT FORM THE BASIS OF ANY ADDITION ON THE PART OF THE R EVENUE. IN THE PRESENT CASE THERE IS NO EVIDENCE OTHER THAN THE RE PORT OF THE DVO AND, THEREFORE, THE SAME CANNOT BE RELIED UPON FOR MAKING AN ADDITION. IN THESE CIRCUMSTANCES, THE QUESTION WHICH HAS BEEN FRAMED IS DECIDED IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE. THE APPEAL IS DISMISSED. ITA NO.4263/DEL/2014 4 6. IN THE CASE OF CIT VS. PUNEET SABHARWAL (2011) 3 38 ITR 485 (DEL), THE HONBLE DELHI HIGH COURT JUDGEMENT WAS CONSISTE NT WITH THE VIEW OF THE HONBLE DELHI HIGH COURT CITED ABOVE. 7. IN VIEW OF THE ABOVE, THE ADDITION IS ORDERED TO BE DELETED. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. THE ORDER PRONOUNCED IN THE OPEN COURT ON 04.11.201 5. SD/- [J.SUDHAKAR REDDY] ACCOUNTANT MEMBER DATED, 04 TH NOVEMBER, 2015. DK COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR, ITAT AR, ITAT, NEW DELHI.