ACIT, Circle-60(1), New Delhi V. Bal Kishan Gupta, Ghaziabad

ITA 5111/DEL/2019

AI Insights

The case involves cross appeals by the Assessee, Bal Kishan Gupta, and the Revenue against the order of the Commissioner of Income Tax (Appeals)-XIX, New Delhi, arising from the assessment order passed under Section 143(3) of the Income Tax Act, 1961 for the Assessment Year 2015-16. The primary issue was the application of Section 43CA, which pertains to the deemed income from the transfer of immovable property where the consideration is less than the value adopted for stamp duty purposes. The Assessee contested the application of this section retroactively to agreements made before its enactment, while the Revenue supported the Assessing Officer's application of the section.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 121466 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 11 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-05-2023
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 15-03-2023
• Assessment Year: 2015-2016
• Appeal Filed On: 02-06-2019
• Other Referred Cases: Index One Trade Con P. Ltd. vs. DC IT (2018) 97 taxmann.com 174 (Jaipur)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Capital asset
• Section: 15; 43CA; 43; 13; 22; 20

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “A” DELHI BEFORE SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER & SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER I.T.A. No.4974/DEL/2019 Assessment Year 2015-16 Bal Kishan Gupta B-24 A4 Shalimar Garden Extn-5 Sahibabad Ghaziabad Vs. ACIT Circle-60(1) New Delhi. TAN/PAN: AIUPG2941A (Appellant) (Respondent) I.T.A. No.5111/DEL/2019 Assessment Year 2015-16 ACIT Circle-60(1) New Delhi. Vs. Bal Kishan Gupta B-24 A4 Shalimar Garden Extn-5 Sahibabad Ghaziabad TAN/PAN: AIUPG2941A (Appellant) (Respondent) Assessee by: Shri C.S. Anand, Adv Shri Ashok Aggarwal, Adv Department by: Shri Kanv Bali, Sr.DR Date of hearing: 16 03 2023 Date of pronouncement: 29 05 2023 O R D E R PER PRADIP KUMAR KEDIA, A.M.: T he capti oned C ross A ppeals h ave bee n fi led by the A ssessee and the Revenue a gains t t he order of the Co mmis si oner of Inc ome T ax (A ppeals )-XIX, N ew Delhi [‘ C IT (A )’ in sh ort ], I.T.As. No.4974 & 5111/Del/2019 2 dated 27. 03.2019 a ris in g from the assess me nt o rder dated 30. 12.2017 passed by t he Assess ing Office r (A O ) under Se ct ion 143(3) of the Inc ome T ax A ct, 1961 (t he A ct ) c on cerni ng AY 2015-16. 2. Bo th Revenue and th e A ssessee ha ve chal le nged t he fi rst appel late order pa ssed b y the CIT (A ) dat ed 27. 03. 2019 a ris i ng fro m assess me nt orde r date d 30. 12. 2017 pass ed und er S ecti on 143(3) of th e A ct. 3. T he Grounds o f ap peal ra ise d by the Rev enue read as unde r: “ 1 . The or de r of th e C I T (A ) i s b a d i n l a w a n d n ot in c o n s o n a nc e w i t h t h e f ac t s o f t he c a s e . 2 . O n t h e f a c t s a n d c i r c u m s ta n c e s o f t he c as e t he Ld. C I T ( A ) h a s e r r e d b y d o w n s c al i n g t h e ad di t i o n o f R s . 3 , 66 , 4 1 , 1 40/ - . 3 . O n t h e f a c t s a n d c i r c u m s ta n c e s o f t he c as e t he Ld. C I T ( A ) h a s e r r e d i n gi v i ng th e as s e s s e e th e b e n e fi t of s e c t i on 4 3 C A ( 3 ) o f t he I . T. A c t . ” 4. T he Grounds o f ap peal ra ise d by the assessee read as under: “ 1 . Th at on t h e f ac t s o f t he c a s e a n d un d e r t he l aw, t h e I d C I T (A ) h a d e r r e d i n s us t ai n i ng t h e a d di t i o n m a de by t h e Id A S S E S S E E u / s 4 3C A , t o t h e e x t e n t o f R s . 2 3 , 2 3 , 04 8/ - (a s p e r t he d e t ai l s t a b u l a t e d i n r e s p e c t o f R a m a Sw ar n G a r d e n ) . T he I d. C I T ( A ) h a d f a il e d t o a pp r e c i a t e ( a ) t ha t t he a g r e e m e n t s w e r e e nt e r e d in t o b y & b e t w e e n t h e as s e s s e e an d t h e b u y e r s , m u c h p r i o r t o t he d at e of i n s e r t i on of s e c t i o n 4 3 C A i n the I. T . A c t 1 96 1 ; a n d t h e a s s e s s e e w a s no t i n a po s i t i on t o a s k f o r mon i e s , o v e r & a b ov e t he c on s i d e r a ti o n a s a l r e a d y a g r e e d b y & b e t we e n t he a s s e s s e e a n d t h e b uy e r s . 2 . Th at o n t h e f ac t s o f t he c a s e an d un de r t h e l aw t he I d C I T ( A ) h a d e r r e d i n s us t a i n in g t h e a d di t i o n t o t he e x t e n t of R s . 1 6 , 3 1 , 2 2 5 / - (a s pe r t h e d e t ai l s t ab u l a t e d i n r e s pe ct of R am a K r i s h n a F a r m ) . T he I d. C I T ( A ) h a d f a il e d t o a pp r e c i a t e ( a ) t ha t t he a g r e e m e n t s I.T.As. No.4974 & 5111/Del/2019 3 w e r e e nt e r e d in t o b y & b e t w e e n t h e as s e s s e e an d t h e b u y e r s , m u c h p r i o r t o t he d at e of i n s e r t i on of s e c t i o n 4 3 C A i n the I. T . A c t 1 96 1 ; a n d t h e a s s e s s e e w a s no t i n a po s i t i on t o a s k f o r mon i e s , o v e r & a b ov e t he c on s i d e r a ti o n a s a l r e a d y a g r e e d b y & b e t we e n t he a s s e s s e e a n d t h e b uy e r s . 3 . Th at o n t h e f ac t s o f t he c a s e an d un de r t h e l aw t he I d C I T ( A ) h a d e r r e d i n s u s t a i n i n g t he ad d i t i o n t o t h e e x t e nt of R s . 6 , 24 , 31 6 / - ( a s p e r t he r d e t a i l s t a bu l at e d i n r e s p e c t o f R a m a B an k e y B i ha r i U pa v a n ). T he I d. C I T ( A ) h a d f a il e d t o a pp r e c i a t e ( a ) t ha t t he a g r e e m e n t s w e r e e nt e r e d in t o b y & b e t w e e n t h e as s e s s e e an d t h e b u y e r s , m u c h p r i o r t o t he da t e o f i n s e r t i o n of s e c t i on 43 C A i n th e I T. A c t 1 96 1 ; a n d t h e a s s e s s e e w a s no t i n a po s i t i on t o a s k f o r mon i e s , o v e r & a b ov e t he c on s i d e r a ti o n a s a l r e a d y a g r e e d b y & b e t we e n t he a s s e s s e e a n d t h e b uy e r s . ” 5. Br ie fl y state d, t he assessee is e ngage d in r ea l es tate bus iness by w a y of acqu isit ion, devel op ing an d s elli ng of plots. T he assessee filed ret urn of income fo r Assess me nt Year 2015 -16 in que st ion d ec laring taxable inco me at Rs.22, 48, 84 0/-. The re tu rn so fi led w as subj ect ed to scrutin y as sess ment. As per the first pa ra graph o f the assess me nt or de r, t he asses see admi ttedl y appea re d be fore t he A sses si ng O ff icer from ti me to t ime a nd fur nis hed t he r el evant de tai ls/i nfo rma tion/evi de nces. In the c ourse of t he as sessment, the A ssessin g Of fi cer i nter alia notic ed tha t the assessee has earned i ncome from sale of plot to t he t une of Rs. 2, 35, 74, 920/-. O n per usal of the sale de eds submi tte d b y the assessee in this rega rd, the A ssess i ng Of fice r observed that the assessee has s ol d vari ou s pl ots at a considerati on w hich is low er than the circle rate /st a mp dut y ra te presc ri bed b y the Sta te G ove rnment. The Assessing Of fice r i nvoked t he pr ovisi ons of Sect ion 4 3CA of t he A ct and made an addi ti on o f Rs.3, 66, 41,140/- tow ard s dif fe re nce be tween the c ir cle r ate and the act ua l sa le consi derati on rece ive d t ow ards s ale of pl ots u nde r i ts va ri ous I.T.As. No.4974 & 5111/Del/2019 4 plans /sc he mes. 6. A gg rieve d by the addi tions s o ma de, th e as sesse e preferre d appea l before the CIT (A ). Be fore the C IT (A), the ass essee filed detai le d submiss i ons and ass ailed the acti on of t he A O to ar ti fic ial l y ass ume the d iffe rence betw een the ci rcle rate o f FY 2014-15 (A Y 2015-16) and the agree me nt v al ue men ti oned in sa le deeds as de emed inc ome ta ki ng shelter of Secti on 43CA of the A ct. T he Assessee chal lenged the v er y a ppl icabi l it y of S. 43CA w her e the a gree ment b y w a y o f al l ot me nt of p lo ts w ere alrea dy reache d w it h th e pro spect iv e bu yers much pr ior the ins er ti on of S. 43CA in the Statut e. 6. 1 O n facts, the ass essee in ter a lia submi t te d doc ume nta r y evidence s t ow ar ds allot ment to s everal a llo tees in t he ear li er ye ars, re ceip t of p ar ti al p ayme nts against agreed considerati on in cash an d i n chequ es, IT R, ba lance s hee t, ban k s ta tement o f the all otte es et c. and br oa dl y conten ded tha t w hen recko ned fr om the date of f irst pa yment a nd al lo tment lette r determining ag reement value, th e ci rc le ra te o f the la ter ye a r w ou ld nat urall y show dis pa rit y d ue to t i me gap and c i rc le ra te w oul d natura ll y e xcee d the act ual sa le c onsiderations r ea liz ed on sale of pl ots. 6. 2 T he C IT (A) ca lled for t he re ma nd repor t on t he e vi de nces fur nis hed by t he assessee. R ejoinder o f the ass essee t hereon w as als o taken n ote of and fo rms pa rt of the fi rs t a ppel la te order. Th e CIT (A ) a ls o anal yzed the tabulat ed dat a place d b efore it t ow ards all ot ment o f pl ot to va ri ous pa rti es under di fferent schemes a nd note d that since the pa rt pa yme nts f or t he plo ts have be en rec ei ve d by t he a ssesse e over a pe ri od of several years agains t the I.T.As. No.4974 & 5111/Del/2019 5 all ot ment le tte rs, the benefi t o f Sect io n 43C A( 3) and ( 4) is re qui red to be given and thus actual s ale cons iderati on requi res to be ado pted instead of ci rc le ra te w rongl y ado pted by the A O. It w as f urt he r obse rved that provis io ns of Sectio n 43CA i nsert ed b y Finance A ct, 20 13 ca me in to forc e w . e. f A ssess me nt Y e ar 2 014-15 onw a rds an d si nc e in the insta nt ca se, the a llot ment w as issued much prio r to that date as ta bula te d in the fi rs t appel late orde r, impug ned a ddi tions made b y the A ssessi ng O ffi cer by appl yi ng pro visions of Section 43CA (4) i s co nt ra r y to t he j udic ial view in this rega rd. Re fe re nce w as made to th e de cis i on of the C o-o rdi nat e Bench i n t he cas e of Inde x O ne Trade Con P. Ltd. vs. DC IT (201 8) 97 taxm ann. com 174 ( Jaipur ) (T ri b. ) w he re in in t he simi lar ci rc ums ta nces, the add iti ons under Secti on 43 CA w as reversed. 6. 3 T he relevant oper ati ve pa ragra ph of the order of th e CIT (A ) is reprodu ce d he re unde r for the sa ke of eas y r efe rence. “ 7 . 1 I f i n d t h a t t h e r e q u i s i t e d e t a i l s a s r e p r o d u c ed i n p a r a 6 a b o v e w e r e b e f o r e t h e A . O . O n t h e b a s i s o f e x a m i n a t i o n i n o n e c a s e o n l y , t h e I d . A . O . h a s h y p o t h e s i z e d t h a t c a s h m u s t h a v e be e n r e c e i v e d f o r s a l e . B a s e d u p o n m y e x a m i n a t i o n , I f i n d t h a t t h i s is n o t t h e c o r r e c t p o s i t i o n . I n a l m o s t a l l c a s e s s o m e a m o u n t ( o r r a t h er t h e s u b s t a n t i v e a m o u n t o r a l m o s t t h e e n t i r e c o n s i d e r a t i o n ) h a s b e e n r e c e i v e d b y c h e q u e . H o w e v e r , f o r p u r p o s e s o f b e n e f i t o f s e c t i o n 4 3 C A ( 3 ) , t h e l i m i t i n g c o n d i t i o n i s p r e s c r i b e d i n s e c t i o n 4 3 C A ( 4 ). A c c o r d i n g l y , i t i s r e l e v a n t t o f i n d o u t t h e i n s t a n c e s w h e r e a m o u n t w a s r e c e i v e d i n c a s h o n l y , o n o r b e f o r e t h e d a t e o f a g r e e m e n t . I t i s o n ly i n s u c h c a s e s t h a t b e n e f i t o f p r o v i s i o n s o f s e c t i o n 4 3 C A ( 3 ) i s n o t a v ai l a b l e t o a n a s s e s s e e . 7 . 2 I h a v e e x a m i n e d t h e d o c u m e n t s b e i n g a l l o t m e n t le t t e r , s a l e d e e d s a n d o t h e r r e c o r d s . I h a v e d o w n l o a d e d p u b l i s h ed c i r c l e r a t e w h i c h a r e a v a i l a b l e i n p u b l i c d o m a i n o n t h e i n t e r n et . I h a v e r e q u i r e d t h e a p p e l l a n t t o p r o v i d e d e t a i l s , w h i c h h a v e b e e n pr o v i d e d b y t h e a p p e l l a n t v i d e l e t t e r d a t e d 0 4 . 0 2 . 2 0 1 9 a s f o l l o w s : - I.T.As. No.4974 & 5111/Del/2019 6 I.T.As. No.4974 & 5111/Del/2019 7 I.T.As. No.4974 & 5111/Del/2019 8 I.T.As. No.4974 & 5111/Del/2019 9 I.T.As. No.4974 & 5111/Del/2019 10 I.T.As. No.4974 & 5111/Del/2019 11 I.T.As. No.4974 & 5111/Del/2019 12 I.T.As. No.4974 & 5111/Del/2019 13 I.T.As. No.4974 & 5111/Del/2019 14 I.T.As. No.4974 & 5111/Del/2019 15 I.T.As. No.4974 & 5111/Del/2019 16 T h u s o n t h e b a s i s o f a f o r e s a i d a n a l y s i s , t h e f o l l o wi n g a d d i t i o n s s u r v i v e - I.T.As. No.4974 & 5111/Del/2019 17 S r . N o N a m e o f t h e S c h e m e R s . 0 1 R a m a B a n k e y B i h a r i U p v a n N i l 0 2 R a m a S w a r n G a r d e n ( V r i n d a w a n ) 2 3 . 2 3 , 0 4 8 0 3 R a m a K r i s h n a F a r m ( H e m l a t a ) 1 6 , 3 1 , 2 2 5 0 4 R a m a B a n k e y B i h a r U p v a n 6 , 2 4 , 3 1 6 0 5 T o t a l 4 5 , 7 8 , 5 8 9 T h u s i n v i e w o f t h e a f o r e s a i d a n a l y s i s , t h e a d d i t i on a m o u n t i n g t o R s . 3 , 6 6 , 4 1 , 1 4 0 / - g e t s d o w n s c a l e t o R s . 4 5 , 7 8 , 5 8 9 /- . F u r t h e r t h e a p p e l l a n t h a s c l a i m e d s e t o f f o f a m o u n ts b y p l e a d i n g " t h at t h e c i r c l e r a t e v a l u e a s o n t h e d a t e o f a g r e e m e n t , i n f e w c a s e s e x c e e d s t h e a c t u a l s a l e c o n s i d e r a t i o n r e c e i v e d b y t h e a s s e ss e e a n d i n f e w c a s e s i s l e s s t h a n i t i s l e s s t h a n t h e c i r c l e r a t e v a l u e a s o n t h e d a t e o f a g r e e m e n t . T h e a s s e s s e e h a s w o r k e d o u t t h e f i g u r e s o f s u c h d i f f e r e n c e a n d h a s n o t i c e d t h a t t h e r e s u l t a n t s u m i s R s . 1 5 , 1 3, 5 6 5 / - ( R s . 2 9 , 4 7 , 3 6 4 - R s . 1 4 , 3 3 , 7 9 9 ) . Y o u r h o n o r i s t h e r e f o r e r e q u e s t e d t o k i n d l y h o l d t ha t p r o v i s i o n s o f s u b - s e c t i o n 3 o f s e c t i o n 4 3 C A a p p l i e s t o t h e c a s e of t h e a s s e s s e e a n d d e l e t e t h e a d d i t i o n o f R s . 3 , 6 6 , 4 1 , 1 4 0 / - a s m a d e b y t h e I d . A . O w i t h o u t p r e j u d i c e , t h e a d d i t i o n o f R s . 3 , 6 6 , 4 1 , 1 4 0 / - m a y ki n d l y b e r e s t r i c t e d t o R s . 1 5 , 1 3 , 5 6 5 / - . " E v e n w i t h r e g a r d t o a d d i t i o n o f R s . 1 6 , 3 1 , 2 2 5 / - a s i n t h e c a s e o f H e m l a t a , a s r e f e r r e d t o i n p a r a 8 . 3 a b o v e , t h e a p p el l a n t p l e a d e d t h a t t h e i n t e n t i o n o f l a w w a s t o p r o v i d e r e l i e f w h e n b o o k i n g / a l l o t m e n t / a g r e e m e n t w a s d o n e i n t h e p r i o r ye a r . A s s u c h , t h e c o n d i t i o n o f n o t h a v i n g r e c e i v e d c a s h s h o u l d n o t b e r e a d i n t o t h e p r o v i s i o n s . T o t h i s e f f e c t , t h e a p p e l l a n t s o u g h t t o r e l y u p o n o r d e r o f H o n b l e I T A T i n t h e c a s e o f I n d e x o n e T r a d e c o n e ( P ) L t d . v s . D C I T , r e p o r t e d a s 9 7 t a x m a n n . c o m 1 7 4 ( J a i p u r ) 1 7 2 I T D 3 9 6 , d a t e o f o r d e r 1 6 . 0 7 . 2 0 1 8 . P a r a 1 2 a n d 1 3 o f t h a t o r d e r a r e a s f o ll o w s - " 1 2 . T h e p r o v i s i o n s o f s e c t i o n 4 3 C A h a v e b e e n i n s e rt e d b y t h e F i n a n c e A c t , 2 0 1 3 w e . f 0 1 . 0 4 . 2 0 1 4 r e l e v a n t t o a s s e s s m e n t y ea r 2 0 1 4 - 1 5 a n d i f w e l o o k a t t h e p r o v i s i o n s o f s u b - s e c t i o n ( 3 ) a n d s ub - s e c t i o n ( 4 ) , i t e m p h a s i z e s a s c e n a r i o w h e r e t h e d a t e o f a g r e e m e n t fi x i n g v a l u e o f c o n s i d e r a t i o n f o r t r a n s f e r o f t h e a s s e t s a n d d a t e of r e g i s t r a t i o n a r e n o t t h e s a m e a n d p r o v i d e s t h a t t h e v a l u e a s o n t h e d a t e o f a g r e e m e n t w o u l d b e c o n s i d e r e d p r o v i d e d t h e a m o u n t o f c o n s i d e ra t i o n o r p a r t t h e r e o f h a s b e e n r e c e i v e d b y a n y m o d e o t h e r t h a n c as h o n o r b e f o r e t h e d a t e o f a g r e e m e n t f o r t r a n s f e r o f t h e a s s e t s . 1 3 . I n t h e p r e s e n t c a s e , w h e r e t h e d a t e o f a g r e e m e nt t o s e l l i n r e s p e c t I.T.As. No.4974 & 5111/Del/2019 18 o f t h e t w o f l a t s i s 9 . 4 . 2 0 0 7 , w h i c h i s m u c h p r i o r to t h e f i n a n c i a l y e a r r e l e v a n t t o a s s e s s m e n t y e a r 2 0 1 4 - 1 5 w h e n t h e p r o v i si o n s o f s e c t i o n 4 3 C A h a v e b e c o m e e f f e c t i v e , t h e r e i s n o w a y t h e a s se s s e e w o u l d h a v e f o r e s e e n t h e s e p r o v i s i o n s a t t h e t i m e o f e n t e r i n g in t o t h e a g r e e m e n t t o s e l l t h a t i t h a s t o r e c e i v e t h e c o n s i d e r a t i o n o n l y b y a n y m o d e o t h e r t h a n c a s h . A t t h e r e l e v a n t p o i n t i n t i m e w h e n i t h ad e n t e r e d i n t o a g r e e m e n t t o s e l l , t h e r e w a s n o s u c h r e q u i r e m e n t o f r e c e i v i n g t h e w h o l e o f t h e c o n s i d e r a t i o n i n m o d e o t h e r t h a n c a s h . T h e r e f o r e , i n o r d e r t o m a k e t h e p r o v i s i o n s o f s u b - s e c t i o n ( 4 ) w o rk a b l e , i n o u r v i e w , t h e p r o v i s i o n s o f s u b - s e c t i o n ( 4 ) w o u l d b e a p p l i c a b l e in r e s p e c t o f a g r e e m e n t t o s e l l f o r t r a n s f e r o f a n a s s e t w h i c h h as b e e n e x e c u t e d o n o r a f t e r 1 s t A p r i l , 2 0 1 3 a n d t h u s , n o t a p p l i c a b l e in t h e i n s t a n t c a s e . T h e m a t t e r i s a c c o r d i n g l y r e m a n d e d b a c k t o t h e f i l e o f t h e l d C I T ( A ) t o d e t e r m i n e t h e v a l u a t i o n o f t h e t w o p r o p e r t i e s i n t e r m s o f s u b - s e c t i o n ( 3 ) a s o n t h e d a t e o f a g r e e m e n t t o s e l l w h ic h i s 9 . 4 . 2 0 0 7 a n d w h e r e i t i s s o d e t e r m i n e d t h a t s u c h v a l u a t i o n i s h ig h e r t h a n w h a t h a s b e e n d e c l a r e d b y t h e a s s e s s e e , t h e s a m e c a n b e b r o ug h t t o t a x i n t h e y e a r u n d e r c o n s i d e r a t i o n . " I n o t e t h a t w h a t t h e a p p e l l a n t w a n t i s a d i f f e r e n t i n t e r p r e t a t i o n . I n m y u n d e r s t a n d i n g w h e n t h e p r o v i s i o n s a r e c l e a r a n d u n am b i g u o u s n o l a w s o f i n t e r p r e t a t i o n o r i n t e n t i o n h a v e t o b e r e f e r r e d t o . T h i s a r g u m e n t / c o n s i d e r a t i o n / f a c t w a s n o t b e f o r e t h e H o n' b l e I T A T . A c c o r d i n g l y , t h e p l e a o f t h e a p p e l l a n t w i t h r e g a r d t o a d d i t i o n o f R s . 1 6 , 3 1 , 2 2 5 / - , i s r e j e c t e d . I n o t e t h a t b a s e d o n m y e x a m i n a t i o n a n d a n a l y s i s , th e a d d i t i o n o f R s . 4 5 , 7 8 , 5 8 9 / - , i s t o s u r v i v e . T h e a s s e s s e e h o w e v e r , ha s p l e a d e d f o r a s e t o f f a s d e t a i l e d i n t h e e a r l i e r p a r a g r a p h , a n d a f t e r s e t o f f , a c c o r d i n g t o t h e a p p e l l a n t , a t b e s t a n d w i t h o u t p r e j u d i c e , e v e n t h e a d d i t i o n o f R s . 2 9 , 4 7 , 3 6 4 / - m a y g e t d o w n s c a l e d t o R s . 1 5 , 1 3 , 5 6 5 / - . I a m o f t h e v i e w t h a t l a w d o e s n o t p r o v i d e f o r s u c h a s e t o f f . T h e r ef o r e , t h i s p l e a o f t h e a p p e l l a n t i s t o b e r e j e c t e d s u m m a r i l y . T h e a p p e l l a nt i n h i s p l e a d i n g s d u r i n g t h e c o u r s e o f h e a r i n g e x p l a i n e d t h a t e v e n a s p e r t h e A . O . , n o a m o u n t o f s a l e c o n s i d e r a t i o n h a s b e e n r e c e i v e d o v e r a n d a b o v e t h e s a l e c o n s i d e r a t i o n . T h e a p p e l l a n t p l e a d e d t h a t t h e re i s n o c o n c e a l m e n t w h a t s o e v e r , a n d t h e r e f o r e , t h e i n c o m e a c t u a l l y r e c ei v e d a n d s h o w n i n t h e s a l e d e e d s i s t o b e c o n s i d e r e d . I n o t e t h a t t h is i s n o t a c a s e w h e r e a n y c o n c e a l m e n t h a s b e e n m a d e o r d e t e c t e d . I a l s o no t e t h a t t h e c a s e h e r e i s n o t t h a t o f r e c e i p t o f c o n s i d e r a t i o n o v e r an d a b o v e t h e s a l e d e e d c o n s i d e r a t i o n . H o w e v e r , t h e a d d i t i o n h a s b e e n m a d e o n a c c o u n t o f pr o v i s i o n s o f l a w c o n t a i n e d i n s e c t i o n 4 3 C A ( 1 ) t i l l 4 3 C A ( 4 ) o f t h e I nc o m e T a x A c t , 1 9 6 1 . I n t h i s v i e w o f t h e m a t t e r a l s o , t h e a p p e l l a nt ' s p l e a o f d e l e t i o n o f a d d i t i o n o r r e s t r i c t i n g t h e a d d i t i o n t o R s . 1 5 , 13 , 5 6 5 / - i s a l s o t o b e r e i e c t e d . 1 0 . I n f i n a l a n a l y s i s , t h e a p p e l l a n t s u c c e e d s i n p ar t i n t h i s a p p e a l . T h e a d d i t i o n a m o u n t i n g t o R s . 3 , 6 6 , 4 1 , 1 4 0 / - , g e t s d o w n s c a l e d t o R s . 4 5 , 7 8 , 5 8 9 / - . ” I.T.As. No.4974 & 5111/Del/2019 19 7. B a se d o n ap pr e c i a t i on o f fa c t s a n d l e ga l po si t i on , t he C I T( A ) i n th e f in al a n a ly s i s g ra nt e d s ub s ta nt i a l r e l i e f to t h e a s ses se e a n d sc a l e d dow n a d d i t i o n s u nd e r S e ct i on 4 3 CA o f t h e A c t f ro m Rs. 3, 6 6, 4 1 , 14 0 / - t o Rs. 4 5, 78 , 5 89 /- . 8. A g gri e v e d by t he p a rt i a l re l ie f, bo th t h e R e v e n ue a nd a s s e ss ee a re i n a pp e a l b e f ore t h e T r i b u n a l a s p e r t he ir r e s pe ct i ve cr o ss a pp e a ls. 9. W i t h r e f e r e n c e t o r e ve n u e a p pe a l , t he l d. D R fo r t h e Re v e nu e su p p or t e d t he a c t i o n o f t h e A sse s s in g O ffi c e r a n d sub mi t t e d t h a t t he pr o vi si on s o f S e c t i on 4 3 CA i nse rt e d by F i n an ce A c t, 20 13 , t h e A sse s si n g O ff i c e r ha s m er e l y a d op t e d t he c i r c l e r a te i ns t e a d o f a gr e e me nt r a t e/ a l l o t me nt r at e i n t u n e w i th S e c ti o n 4 3C A o f t h e A ct . Th e L d. D R t h u s s ub m i t te d t ha t w h e r e t he c i rc l e r a te i s i n e x c e s s o f t he a c t ua l sa l e c on sid er a t i o n , t h e a c t u a l sa le c on si d e r a t i on i s re q u i r e d t o be s u b s t it u t e d b y t he d e e m i ng p r o v i si o ns o f S . 43C A i n fo r c e a nd th e n o fa u lt c ou l d b e f ou nd w i t h t h e ac t io n o f A O . 10 . A s r e ga r ds a p pe a l o f t he a s se s s e e o n t he a d di t io n o f Rs. 1 6 , 31, 2 2 5/ - i n t he c a se o f H e m l at a a s c o n f i r m e d b y t he CI T( A ), t he l d. D R r el i e d u p o n t he a v er me n t s ma de i n t h e firs t a p p el l a te or d e r a n d s u b m i t t e d t ha t t h e l a w u nd e r S ec t i o n 43 C A ha s be e n c or r e c t l y a p pl i e d fo r t hi s a ll ot t e e. 11 . T he l d. c o un se l f o r t he a s se sse e , on th e o t he r ha n d , s tr on gl y re l ie d u p o n t he s ub mi ssi on s m a de be fo r e t h e CI T ( A ) a nd t he fi n d i n g s t h e r e o n b y t he C I T (A ) . T h e L d. Cou ns e l su bmi t t ed t ha t t h e pa y m e nt s w e r e re c ei v ed a n d t h e a l l o t me n t l e t t e r s w ere i ss ue d a s t ab ul at e d b y t h e C IT (A ) i n i ts d e t a il e d o r de r w hi le a n a l y z i n g t h e fa c tu al ma t ri x. I t w a s s u b m i t t e d th a t t h e A O ha s gro s s l y er r e d i n a pp l y i n g t h e st a m p du ty r at e / c i rc l e ra t e d es p i t e th e fa c t t ha t t he I.T.As. No.4974 & 5111/Del/2019 20 pl o t s w e r e a l l ot te d i n d i f fe re nt ye a r s mu ch e a rl i er t o t h e a ss e s s me n t ye a r A Y 20 14- 15 w he n S e ct i on 4 3 CA ca m e i nt o fo r c e. It w a s a ss er t e d t h a t a t t he t i m e o f a l l ot me n t a n d f ix a t i o n o f s a le c on si de r a t i o n, t h e p ro v i s o ns o f S e c t i on 43 C A w as n ot i n e xi st e n c e a nd c ou ld n o t b e v i su a l iz e d by t he a s ses se e . It w a s t hu s su b m i t t e d t ha t t h e CI T (A ) h a s r i g h t l y en do r se d t he l e g i t i ma t e a ct i on o f t h e A sse s se e a n d a pp li e d t h e l a w c o rr e c t l y i n sy n c w i t h j u d i c i al di c t a w hi l e g ra nt i n g r el i e f. 12 . A s re g a r d s t he a ss e sse e a p pe al , t h e l d . c ou n s el s ub m i tt e d t h a t he d o e s n ot se e k t o p re ss a l l o th er gr o un ds e x c e pt g r ou n d n o . 2 c on c e rn i n g a d d i t i o n o f R s. 16, 3 1, 2 2 5 / - i n re sp ec t o f p l o t a t R a ma K ri sh n a F a r m al l o t t ed t o H e ml a t a. T he l d . c o u n se l th u s su b m i tt e d t ha t al l ot h e r g ro u n d s m a y b e t r e a t ed a s n ot p re ss ed e x c e pt g r o un d no . 2 o f t h e a s se ss e e a pp e a l . 13 . A s re ga rd s t he a d di t i o ns u nd er S e ct i on 4 3 CA i n r e s pe ct o f H e ml a ta , t h e l d. c o u nse l s ub m i tt e d t ha t de f ac to a g r e e m e nt s w e re du l y e n t e re d i nt o b y a nd b et w e en t h e a ss es s e e a n d He m l a t a , i . e . , t h e bu y e r a n d al so o t h er b u ye rs on i ss u a n ce o f a l l o t m e nt l e t t e r m u c h pr i o r t o t h e d at e o f i ns e r ti on o f S e c ti on 43 C A o f th e A c t an d t he re fo r e , t h e s t a m p du t y ra te / c i rc l e r at e o f t h e c u r re n t ye a r c a n not be a pp li e d for t he a c t ua l c o ns i d e r a t i o n a g re e d o n al l o t me n t o f p l o t s i n t h e e a rl i e r y e a rs. Th e p a y me nt i n c a s h w as n ot a b ar at t he t i m e o f a ll ot m e n t . T he b a r pl a c e d b y S e c t i on 4 3 CA c o m i n g i nt o f or c e su b se q u e n t l y c o u l d no t be ad op t e d fo r t he p u rp os e s o f di sa l lo w a n c e . Th e l d. c o u n se l t h u s s ub m i t t e d t h a t w h i le t he CI T (A) h a s a p p l i e d t he pr i n c i p l e s o f l aw c o r r e c tl y i n re s pe c t o f o t h e r al lot m en ts, n o j us t i f i ab le re a s on h as be e n a ss ig ne d fo r de n y i n g t he r el i e f in r e s pe ct o f a l l o t t e e H e m l a t a an d a d di t i o n s o f R s. 16 , 3 1, 22 5 / - ha s b e e n w ro n gl y a ff ir me d w i t h t h e a i d o f S e c t i o n 4 3CA w hi c h re qu i r e s t o be I.T.As. No.4974 & 5111/Del/2019 21 re v e r se d . 14 . W e h av e c a r e f u l l y c o ns i d e r e d t he ri v a l s u b m i ss io n s an d pe r u s ed t h e ma t e r i a l av a il a bl e o n r ec o r d. 15. The application of Section 43CA in the facts of the case of AY 2015-16 is in question. Section 43CA has been inserted by Finance Act, 2013 and is applicable from Assessment Year 2014-15 onwards corresponding to previous year 2013-14. On a broader reckoning, section 43CA [w.e.f. 1-4-2014] of the Income-tax Act create deeming fiction as regards full value of consideration received on transfer of asset, being immovable property. Consequently, where the consideration for the transfer of an asset (other than a capital asset), being land or building or both, is less than the value adopted for stamp duty purposes, the value so adopted or assessed shall be deemed to be the full value of consideration for the purposes of computing income under the head profits and gains of business or profession. 15 . 1 I n t he c a s e u n de r co n si de ra t i o n, t h e a pp li c a b ili t y o f S . 4 3 CA ha s be e n s u b j e c t m at t e r o f c o nt r o ve rsy . I n th e pr e se n t c a s e, t h e un d i s pu t e d fa c t s a re t h a t t he a ss e sse e , e ng ag ed i n re a l e st a te bu s in es s , h a s r e ce i ve d a p a r t c on si de r a t io n o f ce r ta i n m ut u a l l y a gr e e d s a le pr i c e a nd i ss u e d a l l ot m en t l e t t e r s i n lie u t h e r e o f to w a r d s sa l e o f pl ot s t o v a r i ou s a l l ot t ee s. T h e A sses s e e has re c e i v e d m a jo ri t y pa y m e nt t h r o ug h b a nk i n g c ha nn el i n t he e a r l i er y ea rs mu c h p ri or t o t he i nse rt i o n o f S e ct i o n 4 3 C A o f t h e A c t w . e . f 1 -4 -2 01 4 i. e A Y 20 1 4- 15. T he A O h ow e ve r, a p p l i e d t h e p ro v i sio ns o f s e c t i o n 43 CA a nd su bs t i tu te d th e s a l e c o n si de ra t i on d et e r m i ne d at th e ti m e o f a ll ot m e n t o f p l o t s t o va ri ou s c u st o me r s w i t h t h e cor re s p o nd in g st a m p d u t y v a l ua t i o n a pp l i c a b le fo r t hi s ye a r w he r e ag r e e me n t fo r sa l e o f p l o t w a s e x e c u t e d fo r t h e pu r p os e s o f t r a nsfe r o f pl o t s. T he CI T ( A ) t o o k c o gn i z a nc e o f t he a l lo t me nt l e t t er a nd n o t i c e d t h a t i t i s I.T.As. No.4974 & 5111/Del/2019 22 a ct ua l l y a n ag re e m e nt w h e r e t h e sa l e c on si d e ra ti o n i s a l r e a d y fi xe d a t t h e t i m e o f a l l ot me n t i n t he l i gh t o f j u d g m e n t of t he H o n’b le S up re me C ou rt i n th e c a se o f D L F U n iv e r sa l L t d. v s. A pp ro pr i a t e Au t ho ri t y & a n rs. 2 43 IT R 7 3 0 (S C ); R . N. S on s ( P ) Lt d. v s. Ap pr o p ri a t e A u t h o r i ty 33 0 IT R 4 5 5( D e l . ). T he CIT ( A ) t h u s ob se r v e d t ha t t h e d a te o f a gr ee m en t o f t r a n s fe r (b y w ay o f al l o t m e n t o f p l o t s ) i s d i ff er en t th an t he d a t e o f t ra n s f e r du ri n g t h e AY 2 0 15 - 1 6 i n qu e st i o n a nd h e nc e t he st a m p d u t y va lu e a s on t he da t e o f a gr e e me nt by w a y o f a l lo t m e nt l e t t e r i s t o b e c o ns i d e r e d as fu l l v a l u e o f c on si de r a t i o n a nd no t t h e s t a mp d u ty v al ue a s o n t he d a t e o f t ra ns f e r . S ev e r a l d e ci si on s o f c o -o rd i n a t e be nc h o f tr i bu n al w e re re fe rr e d t o a n d r el i e d up on. 15 . 2 T he a s se sse e p oi n t s o u t t ha t th e C I T( A ) h a s a na ly ze d t he pr o vi si on s o f S e c t i on 43 C A o f t he A ct i n c o nj un c t i on w it h t h e j ud i c i a l p r ec e d e n t s w it h r e f e r e nc e t o t h e p ur p o r t of a ll o t m e nt l e t t e r / a gr e e me nt w i t h v a r i ou s al l o t t e e s an d f ou n d m e r i t i n t he p l e a o f t he a ss es se e t ow a r ds n on a p p l i ca bi l i t y o f S ec t i on 4 3 C A i n t h e fa c t s o f t he c a se w h e r e t h e ob l i ga t io n t o h a nd o ve r t he p lo t s t o va r i o u s a ll ot t e es a t a p r e - d et e r m i ne d co ns i d e ra t i on a lr e ad y ar ose to t he a ss es se e pr i o r t o th e i ns e r t i on o f S . 43 C A i n t he st a t u t e . Th e CI T ( A ) t hu s a gr ee d w i t h t he c on te nt i on o f t h e a ss e s se e f o r a d o pt i o n o f pr e d e t e r m i n e d v a l u e for s a l e a s t h e fu l l va l u e o f co n si d e ra t io n. T he CI T ( A ) fo u n d t ha t w h e re t h e as s e ss e e c o m mi t t e d for pr o po sed sa le a nd o ff e r w e r e a c c ep t e d b y t h e a l lo t e e s o f t h e p l o ts a t c e rt a i n p r i ce mu ch p ri o r t o t h e i n se r t i o n o f S . 4 3 C A , t he ci r c l e ra t e n o ti f i e d i n t he ye a r o f tr a n s fe r c a n no t b e a d o pt e d fo r t he p u r po ses o f S . 43 CA . 15 . 3 T he A s ses s e e c o nt e n d s th a t w he r e al l o t me n t w e re i s su e d m u c h pr i o r t o th e fi na n c i a l y e a r re le v a n t t o a s se ss m e nt y e a r 20 1 4 -1 5 w he n t he p r o vi si on s o f S e c ti o n 4 3 CA ha v e be co me e ffec t iv e , t h er e i s I.T.As. No.4974 & 5111/Del/2019 23 no w a y a n a ss e s se e c o ul d h a v e fo re se e n t he se p ro v i si o n s at t he t i me o f a ll ot m e n t . Be si de s, a t th e r e le v a n t p oi nt i n t i me w he n t he a ll ot m e n t l et t e r w e r e i s s ue d t he r e w as no s uc h re quir e me nt o f re c ei vi n g t he w h o l e o f th e co ns i d e r a t i o n i n t he mo de ot h er t ha n c as h . I n fa c t , as st at e d, t h e as se sse e ha s r ec e i v e d m a j o r i t y p ay me nt by ch e q ue i n t h e e a rl i e r y e a rs f r o m v ar i ou s al l ot t ee s, e x c e p t i n t h e c as e o f a n a l l o t ee na m e l y ‘ H e m l at a ’ w he r e a pa rt o f t he c on si de r a t i o n o f R s . 3 750 0 / - w a s re c e i ve d i n c a sh on 0 8 / 1 2/ 2 0 0 6. 15 . 4 T he i ss u e i s sq ua r el y c o v e re d in fa v o ur o f t h e a ss e s se e b y ho s ts o f t he j u dg m e nt s i n c l u di n g I nde x O n e T r a de Co n P. L t d. (su pr a). 16 . O n a p p r a i sa l o f t h e fa c t u a l a n a l y s i s c a r ri e d out by th e CI T( A ) a nd a p pl i c a b l e le ga l po si t i o n t he r e o n , w e se e n o perc e pt i bl e e rr or i n t he fi n d i n g s r en de re d b y t he C I T ( A ) on fi r s t p r i n c ipl e s t h a t t he c ir cl e r a t e o n t h e d a te o f a g r e e m e nt ca n n ot b e s ubs t i t ut e d fo r a gr e e d a nd a c t u a l s al e c o n si d e r a t io n de t e r mi n e d i n t er ms of a l l ot m e n t l e t t e r w he re by t h e c o nt ra c t u a l ob l i g at i o n s t o t ra ns f e r th e p l o t s ha d a l re a d y be e n f a s te n e d on t he a ss e s se e i n th e e ar l ie r y e a rs, mu ch p ri or t o i ns e r t i on o f s. 4 3 C A . T he r e l i e f t h us g ra nt ed b y t he C I T (A ) i s i n t un e w it h t he s c h e m a t i c i n te rp re t at i o n o f S . 43 CA an d t h u s d e se rv e s t o h ol d t h e fi e l d . H e nc e, We d ec l i ne t o i n t e r fe r e . T h e a pp e a l o f t h e re v e n u e t hu s fa i ls . 17 . W e n ow t ur n t o t he ap pe al o f t he A s ses se e s e e k in g t o c ha ll e n g e t h e d e n i al o f r el i e f g ra nt e d i n t h e c a se o f one a l l o t e e na me l y, H e m la t a o n t h e gr o u n d t ha t a l l o t m en t le t t e r fo r t r a n s fe r o f pl o t h a s b e e n is s ue d for c o ns i d e r a t i on r ec e iv ed i n c a sh a l be it i n F Y 20 0 6- 07. 17 . 1 T he CI T( A ) d e n i e d re l ie f a n d su st a i n e d a p p l ic at io n o f S . 43 CA I.T.As. No.4974 & 5111/Del/2019 24 t o t r a ns a ct i o n c a r r i e d o ut i n c a sh i n t h e ea rl i e r ye a r t ak in g sh e l te r o f su b -s e c t i on ( 4) o f S e ct i o n 4 3C A o f t he A c t . Th e a c ti o n o f t he CI T ( A ) i s sq u a r e ly o p po se d t o t he de ci si o n o f th e co- o rd i n a t e b e nc h i n I nd e x on e ( s up r a) . We s ee n o j u s ti f ia bl e r e a s o n to de ny t h e be n e f it o f a gr e e me n t va lu e i n st e a d o f c i rc le ra t e i n t he c ase o f H e ml a ta w he re th e c on d i t i o n o f re c ei pt i n c h e q ue h a s b e e n unj u s tl y r e a d i nt o t he p ro vi si o ns i n c on t r a d i ct i o n t o t h e j u d g m e n t o f t he Co - or d i na te Be nc h i n I nd ex O ne T ra de Co n P. L t d. T he t ra ns a c t i o n i n c a sh oc c ur r e d i n A Y 2 007 - 0 8 w he n th e pr o vi si on s o f Se c t io n 4 3CA w a s no t a t al l e x i st i n g i n st a t u te b o o k. 17 . 2 S i gn i fi ca nt l y, t h e a sse ss e e i s i n t h e b u si n e s s o f r ea l e s t a t e an d ha s i ss ue d a l lo t m e nt l e t t e r s for sa l e o f p lo t t o l ar g e n u m b e r o f pa r t i e s an d so ld a b ou t 7 0 p l o t s. Th us, t h e a ss e s se e h as n ot e n t e r e d i nt o a n is o l a t e d i n st a n c e o f a l l ot m e n t o f pl ot w i t h H e m la t a a l o ne . La r ge n u m be r o f a l l o t t e ss s h ow s t he b o n a fi d e o f t h e m o d u s op e ra nd i o f t h e a ss e s se e. Wh e n t e st ed o n t h e t o u c h s to ne o f pr e p o nd er a n c e o f pr o ba bi l i t i e s, t h e bo n a f i d e t r a n sac t i on a n d c on t r a c t ua l c o m mi t me n t w i t h H e m l a t a w a y b ac k i n F Y 200 6- 0 7 c an no t b e d o u bt e d m e r e l y t o i n vo ke a nd a p pl y a p r o sp e c ti v e la w o f S . 43C A . It w a s onl y i n i t i a l p a y me nt o f R s. 3 7, 5 0 0 / - w h ic h w a s re c ei ve d i n ca sh f r o m H e m la t a . T he b o ok in g a m ou nt in c a s h w a s re c ei ve d w ay ba c k o n 0 8. 12 . 2 00 6 fo r a p l o t i n Ra m a K r i sh na F a r m V ri nd av an . T h e fo r m al b o ok in g o f p lo t w as ca rr i e d ou t o n 22 . 0 7. 2 0 0 7 a n d a l l ot m e n t l e tt e r w as ac c or di ng l y i ssue d t o h e r o n 25 . 0 9. 2 0 0 7 . T h e s a l e a g r e e m e nt w a s e xe c u t e d b y a nd b e t w ee n t he a ss es se e a n d H e m l at a fo r t h e s a l e o f p l o t i n F Y 20 14- 1 5 o n 24 . 0 7. 2 0 1 4 a nd r e g is t e re d i n fa v o u r o f H e m l a t a o n 28. 07 . 20 1 4. S i nc e t h e p l o t w a s a l r e ad y a l l o t te d b y t h e a ss e s se e a ga i n st t he s a l e c on si de r a t i o n o f R s . 2 , 50, 0 0 0/ - , t h e a sse ss e e ha d no c h oi c e bu t t o e xe cu te t h e s a l e de ed i n re sp e c t o f p l ot n o . C -4 1 A a d m e asu ri ng 50 0 I.T.As. No.4974 & 5111/Del/2019 25 sq. ya r d i n Ra ma K ri s h n a F a r m i n fa v o ur o f H e ml a t a a n d i n th e w a k e o f c o nt ra c t u al o b l i g at i on s to a b i d e b y t he t e r ms o f a gr e e m e nt e nt e r e d i n t he ye a r 2 00 7 , t he re w a s no re a s on t o d ra w a d v e rs e i n f er en ce a ga in st t h e a ss es s e e u nd er S e c t i on 4 3 CA (4 ) o f t h e Ac t i n se r te d w . e . f A sse s s me nt Y e ar 2 0 14 -1 5. Th e a dd i t i o n o f Rs. 16 , 3 1,22 5 a tt ri b u t a b l e t o a l l o t me n t ca rr i e d i n t he na m e o f H em l a t a i s th us w hol l y u n j u st i fi e d. 17 . 3 H e nc e , i n r e sp ec t t o a pp ea l o f t h e a s s e ss e e, we f i n d j u s t i f i a b l e re a so n t o re ve r se t he a c t i o n o f th e C I T (A ) t o t he e x t en t o f a d d i t io ns c on f i r me d f or t r a ns a c t i o n w i t h H e ml a t a a m o u n t i n g t o Rs. 16 , 3 1, 2 2 5 / -. T he a c t io n o f t he CI T ( A ) to t h i s e xt e nt i s t hu s se t a si de a nd r ev er se d. 17 . 4 O t he r i s su es r ai se d i n t he gr o u nd s o f a pp e a l by t h e a ss e ss ee re m ai ns u n c o n t e s te d i n t h e c ou rs e o f he a r i ng a nd a re t h u s d i s mi ss e d a s n o t pr es se d . 18 . I n t h e r e su lt , t h e a pp e a l o f t he R ev en ue i s di sm is se d w hi l e t h e a pp e a l o f t h e a s se ss e e i s p a rt l y a ll ow e d . Order pronounced in the open Court on 29/05/2023 Sd/- Sd/- [CHALLA NAGENDRA PRASAD] [PRADIP KUMAR KEDIA] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: /05/2023 prabhat