Sanjay Kumar Daryani, Indore V. Pr CIT -1, Indore

ITA 563/Ind/2019

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 7133 (ITAT-INDORE)
• Duration Of Justice: 5 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-10-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Assessment Year: 2014-2015
• Appeal Filed On: 09-05-2019
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: ASHIMA GUPTA
• Assessee Lawyers: GIRISH AGRAWAL; NISHA LAHORI A RS
• Keywords: Sale consideration of property below Jantri Value; Business income; Revision of order; Opportunity of being heard; Additional evidence; Valuation report; Set aside
• Section: 56(2)(vii)(b); 44AD; 143(3); 50C; 142(1); 143(2); 263

Judgement Text

[ITA NO.563/IND/2019] [SHRI SANJAY KUMAR DARYANI, INDORE] , , IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER ITA NO.563/IND/2019 ASSESSMENT YEAR: 2014-15 SHRI SANJAY KUMAR DARYA NI 505, EMERALD COURT C-BLOCK SANJANA PARK NEAR AGRAWAL PUBLIC SCHOOL INDORE / VS. PR. CIT - 1 INDORE ( APPELLANT ) ( REVENUE ) P.A. NO. AIOPD3135D APPELLANT BY SHRI GIRISH AGRAWAL & MISS NISHA LAHORI, A.RS RESPONDENT BY SMT. ASHIMA GUPTA, D.R. DATE OF HEARING: 09.10.2019 DATE OF PRONOUNCEMENT: 24.10.2019 / O R D E R PER KUL BHARAT, J.M: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST ORDER O F THE LD. PR. CIT-1, INDORE DATED 18.3.2019. THE ASSE SSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL: [ITA NO.563/IND/2019] [SHRI SANJAY KUMAR DARYANI, INDORE] 2 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND APP LICABLE LAW, LD. PR. CIT-1, INDORE ERRED IN HOLDING THAT THE ORDER P ASSED BY LD. A.O. U/S 143(3) IS ERRONEOUS AND PREJUDICIAL TO THE INTE REST OF REVENUE WITHIN THE MEANING OF SECTION 263 WHICH IS CONTRARY TO THE MATERIAL ON RECORD AND PROVISIONS OF THE ACT, UNJUST AND BAD IN LAW. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND APPL ICABLE LAW, LD. PR. CIT-1, INDORE ERRED IN HOLDING THAT THE ORDER P ASSED BY LD. A.O. U/S 143(3) IS ERRONEOUS AND PREJUDICIAL TO THE INTE REST OF REVENUE WITHIN THE MEANING OF SECTION 263 WHICH IS CONTRARY TO THE MATERIAL ON RECORD AND PROVISIONS OF THE ACT, UNJUST AND BAD IN LAW, MORE PARTICULARLY WHEN THE CASE WAS SELECTED FOR LIMITE D SCRUTINY FOR ASSESSMENT UNDER SECTION 143(3) TO EXAMINE THE PURC HASE OF PROPERTY. 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND APPL ICABLE LAW, LD. PR. CIT-1, INDORE ERRED IN HOLDING THAT THE ORDER P ASSED BY LD. A.O. U/S 143(3) IS ERRONEOUS AND PREJUDICIAL TO THE INTE REST OF REVENUE WITHIN THE MEANING OF SECTION 263 WHICH IS CONTRARY TO THE MATERIAL ON RECORD AND PROVISIONS OF THE ACT, UNJUST AND BAD IN LAW, ALSO MORE PARTICULARLY WHEN IT IS NOT A CASE OF LACK OF ENQUIRY, AT BEST COULD BE POSSIBLE TERMED AS CASE OF INADEQUATE ENQU IRY. 4. THE APPELLANT CRAVES LEAVE TO ADD, AMEND, ALTER OR OTHERWISE RAISE ANY OTHER GROUND OF APPEAL. 2. THE ONLY EFFECTIVE GROUND IN THIS APPEAL IS AGAINST INVOKING THE PROVISIONS OF SECTION 263 OF THE INCOM E TAX ACT, 1961 (HEREINAFTER CALLED AS THE ACT). HENCE, AL L THE GROUNDS ARE TAKEN TOGETHER AND ARE BEING DISPOSED OF TOGETHER. 3. THE FACTS GIVING RISE TO THE PRESENT APPEAL ARE THAT THE ASSESSMENT IN THIS CASE WAS FRAMED U/S 143(3) OF THE AC T [ITA NO.563/IND/2019] [SHRI SANJAY KUMAR DARYANI, INDORE] 3 VIDE ORDER DATED 7.12.2016. THE A.O. ASSESSED THE T OTAL INCOME AT RS.2,40,080/- AS DECLARED BY THE ASSESSEE. SUBSEQUENTLY, THE LD. PR. CIT-1 INITIATED PROCEEDINGS U/S 263 OF THE ACT AND ISSUED A NOTICE CALLING UPON THE ASSESSEE AS TO WHY THE ASSESSMENT ORDER SO FRAMED BE NO T REVISED. IN RESPONSE TO THE NOTICE, THE ASSESSEE F ILED A WRITTEN SUBMISSION. AFTER CONSIDERING THE SUBMISSI ONS OF THE ASSESSEE, THE LD. CIT SET ASIDE THE ORDER OF THE A.O. AND DIRECTED THE A.O. TO REFRAME THE ASSESSMENT ORDER. AGAINST THIS, ASSESSEE IS IN PRESENT APPEAL. 4. LD. COUNSEL FOR THE ASSESSEE MR. GIRISH AGRAWAL HA S VEHEMENTLY ARGUED THAT THE ACTION OF THE LD. CIT(A) IN REVISING THE CONCLUDED ASSESSMENT IS NOT JUSTIFIED. HE SUBMITTED THAT IN THE ORIGINAL ASSESSMENT PROCEEDINGS, THE A.O. HAS DULY EXAMINED THE ISSUE. THE A.O. MADE ENQUIRIES RELATED TO THE ISSUE. HE SUBMITTED THAT THE ASSESSMENT ORDER CANNOT BE CONSIDERED TO BE ERRONEOUS [ITA NO.563/IND/2019] [SHRI SANJAY KUMAR DARYANI, INDORE] 4 AND PREJUDICIAL TO THE INTEREST OF THE REVENUE. MER ELY BECAUSE THE A.O. DID NOT MAKE ENQUIRY IN THE MANNER WH AT LD. PR. CIT WANTED. HE FURTHER CONTENDED THAT LD. P R. CIT OUGHT TO HAVE HIMSELF MADE ENQUIRY IF HE WAS OF THE VIE W THAT THE ASSESSING OFFICER MADE INADEQUATE ENQUIRY. HE STRONGLY PLACED RELIANCE ON THE JUDGEMENT OF THE HON 'BLE DELHI HIGH COURT RENDERED IN THE CASE OF ITO VS. DG HOUSING PROJECTS LTD. (2012) 20 TAXMANN.COM 587 (DEL HI). LD. COUNSEL FURTHER PLACED RELIANCE ON OTHER CASE LAWS , WHICH ARE MENTIONED HEREIN BELOW: 1. MALABAR INDUSTRIAL CO. LTD. (2000) 109 TAXMAN 66 (S C) 2. SUNBEAM AUTO LTD. (2010) 189 TAXMAN 436 (DELHI) 3. ANIL KUMAR SHARMA (2010) 194 TAXMAN 504 (DELHI) 4. MEHROTRA BROTHERS (2004) 270 ITR 157 (MP) 5. VIKAS POLYMERS (2010) 194 TAXMAN 57 (DELHI) 6. FLEXITUFF INTERNATIONAL LTD. ITA NO.282/IND/2017 (T RIB. INDORE) 7. NAROTTAM MISHRA (2015) 25 ITJ 506 (TRIB. INDORE) 8. KRISHNA CAPBOX (P) LTD. (2015) 60 TAXMANN.COM 243 ( ALLAHABAD) 9. RATLAM COAL ASH CO. (1987) 34 TAXMAN 443 (MP) 10.ASHISH RAJPAL (2009) 180 TAXMAN 623 (DELHI) 11. HINDUSTAN MARKETING & ADVERTISING CO. LTD. (2011) 1 96 TAXMAN 368 DELHI. 12. ANIL SHAH (2007) 162 TAXMAN 39 (MUM.) (MAG) 13. RELIANCE COMMUNICATION LTD. (2016) 69 TAXMANN.COM 1 03 (BOMBAY) [ITA NO.563/IND/2019] [SHRI SANJAY KUMAR DARYANI, INDORE] 5 5. LD. CIT(DR) OPPOSED THESE SUBMISSIONS AND SUBMITT ED THAT A FAIR PERUSAL OF ASSESSMENT ORDER WOULD MAKE IT CLE AR THAT THERE WAS NO ENQUIRY BY THE A.O. IN RESPECT OF TH E ISSUE IN QUESTION I.E. DIFFERENCE AMOUNT OF RS.55,33,00,000/- BEING THE VALUE ADOPTED BY THE STAMP VALUATION AUTHORITY AND DECLARED BY THE ASSESSEE IN TERMS OF SECTION 56(2)(VII)(B) OF THE ACT. FURTHER, THE A.O. HAS NOT VERIFIED THE SOURCE OF REGISTRATION EXPENSES INCURRE D BY THE ASSESSEE. 6. WE HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATERIALS AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. THE BASIS OF REVISING THE ORDER AS STATED IN THE REASON BY THE LD. PR. CIT IS AS UNDER: A. IT IS OBSERVED THAT YOU HAD PURCHASED IMMOVABLE PROPERTY WHICH WAS THE BASEMENT OF THE BUILDING NAMED PALAK AVANUE ADMEASURING 3700 SQ.FT. 15.04.2013 FROM SH. KAILASH SAHU & SHRI MOTILAL SAHU, THROUGH POWER OF ATTORNEY HOLDER SH. KAMAL VERMA, INDORE FOR CONSIDERATION OF RS.1,25,00,000/- WHICH WAS PAID IN CASH TO SELLER I N VARIOUS DATE AND INCURRED REGISTRATION EXPENSES OF RS.14,08 ,345/- WHICH WAS ALSO PAID IN CASH. ON PERUSAL OF PURCHAS E DEED OF ABOVE SAID PROPERTY, IT WAS NOTICED THAT THE MARKE T VALUE OF THE PROPERTY WAS ADOPTED BY STAMP VALUATION AUTHORI TY FOR [ITA NO.563/IND/2019] [SHRI SANJAY KUMAR DARYANI, INDORE] 6 RS.1,80,53,000/-. AS SUCH, DIFFERENCE AMOUNT OF RS.55,53,000/- (1,80,53,000-1,25,00,000) WAS REQUIR ED TO BE ADDED BACK IN THE TOTAL INCOME OF THE ASSESSEE UNDE R THE HEAD OF INCOME FROM OTHER SOURCES AS PER PROVISIO NS OF SECTION 56(2)(VII)(B) OF I.T. ACT BUT THIS WAS NOT FOUND DONE IN SCRUTINY BY THE ASSESSING OFFICER. B. IT IS FURTHER OBSERVED THAT YOUR CONTENTION THA T YOU PAID REGISTRATION EXPENSES OUT OF YOUR SAVINGS AND CAPIT AL. ASSESSEE HAS SHOWN BUSINESS INCOME U/S 44AD OF I.T. ACT AND HAS NOT MAINTAINED BOOKS OF ACCOUNT ON PERUSAL OF RETURN OF 2014-15 THERE WAS NO CAPITAL ACCOUNT FOUND. IN VIEW OF ABOVE, THE REGISTRATION EXPENSES OF RS.14,08,345/- REMAINED UNPROVED/UNEXPLAINED, HENCE APPARENTLY THE REGISTRA TION EXPENDITURE WAS PAID FROM UNDISCLOSED INCOME, AND W AS LIABLE TO BE TAXED WHICH HAS NOT BEEN DONE BY A.O. 7. IT IS NOT CONTROVERTED BY THE ASSESSEE THAT THERE WAS A DIFFERENCE BETWEEN THE SALE CONSIDERATION AS DISCLOSED BY THE ASSESSEE AND THE VALUATION AS ADOPTED BY THE STAMP VALUATION AUTHORITY. WE HAVE PERUSED THE ASSESSMENT ORDER. THERE IS NO WHISPER ON THIS ISSUE. LD. COU NSEL FOR THE ASSESSEE VEHEMENTLY ARGUED THAT DURING THE ASSESSMENT PROCEEDINGS, THE A.O. HAD IN FACT ISSUED A QUESTIONNAIRE U/S 142(1) OF THE ACT AND ALSO NOTICE U/S 143(3) OF THE ACT. HE DREW OUR ATTENTION TO THE PAPE R BOOK PAGE NO.4. THE BASIS OF REOPENING AS PER THE NOTICE U /S [ITA NO.563/IND/2019] [SHRI SANJAY KUMAR DARYANI, INDORE] 7 143(2) OF THE ACT WAS PURCHASE OF PROPERTY. HE FURT HER DREW OUR ATTENTION TO NOTICE U/S 142(1)(II) OF THE A CT AND ALSO DREW OUR ATTENTION TO CLAUSES 4 & 5 OF THIS NOTI CE THAT READS AS UNDER: 4. PLEASE FURNISH COPY OF PURCHASE DEED IN RESPECT OF IMMOVABLE PROPERTY PURCHASED DURING THE F.Y. 2013-14 RELEVANT TO F.Y. 2014-15 ALONG WITH DOCUMENTARY EVIDENCE OF SOURCE OF INVEST MENT THEREOF. 5. FURNISH COMPLETE DETAILS OF INVESTMENTS MADE WI TH DOCUMENTARY EVIDENCES AND SOURCE THEREOF. ALSO FURNISH THE DET AILS OF ALL IMMOVABLE PROPERTIES STANDING IN YOUR NAME OR IN TH E NAME OF YOUR FAMILY MEMBERS. 8. ON THE STRENGTH OF THESE QUERIES, LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE HAD DULY EXAMINED THE ISSUES, THEREFORE, THE LD. PR. CIT OUGHT NOT TO HAVE INITIATED PROCEEDINGS U/S 263 OF THE ACT AND REVISE T HE ASSESSMENT ORDER. DURING THE COURSE OF HEARING, A SP ECIFIC QUERY WAS RAISED TO THE LD. COUNSEL FOR THE ASSESSEE AS TO WHETHER ASSESSING OFFICER HAS MADE ENQUIRY WITH REGARD T O ADOPTION OF STAMP VALUATION FOR THE PURPOSE OF ADOPTING THE SALE CONSIDERATION? LD. COUNSEL FOR THE ASSESSEE COUL D NOT [ITA NO.563/IND/2019] [SHRI SANJAY KUMAR DARYANI, INDORE] 8 POINT OUT SUCH QUERY RAISED BY THE A.O. NOT EVEN THE LD. COUNSEL FOR THE ASSESSEE BRING TO OUR NOTICE ANY EXPLANATION BY THE ASSESSEE REGARDING VALUE ADOPTED BY TH E STAMP VALUATION AUTHORITY. IN THIS FACTUAL MATRIX, IT IS TO BE EXAMINED WHETHER CASE LAWS AS RELIED BY THE LD. COUNSEL FOR THE ASSESSEE ARE APPLICABLE ON THE FACTS OF THE PRESENT CASE. FOR THE SAKE OF CLARITY, SECTION 263 OF THE ACT IS REPRODUCED AS UNDER: 263. REVISION OF ORDERS PREJUDICIAL TO REVENUE (1) THE COMMISSIONER MAY CALL FOR AND EXAMINE THE RECO RD OF ANY PROCEEDING UNDER THIS ACT, AND IF HE CONSIDERS THAT ANY ORDER PASSED THEREIN BY THE 2 ASSESSING] OFFICER IS ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTERESTS OF THE REVENUE, HE, MAY, AFTER GIVING THE ASSESSEE AN OPPORTUNITY OF BEING HEARD AND AFTER MAKING OR CAUSING TO BE MADE SUCH INQUIRY AS HE DEEMS NECESSARY, PASS SUCH ORDER THEREON AS THE CIRCUMSTANCES OF THE CASE JUSTIFY, INCLUDING AN ORDER ENHANCING OR MODIFYING THE ASSESSMENT, OR CANCELLIN G THE ASSESSMENT AND DIRECTING A FRESH ASSESSMENT. 3 EXPLANATION.- FOR THE REMOVAL OF DOUBTS, IT IS HEREBY DECLARED THAT, FOR THE PURPOSES OF THIS SUB- SECTION,- (A) AN ORDER PASSED 4 ON OR BEFORE OR AFTER THE 1ST DAY OF JUNE, 1988 ] BY THE ASSESSING OFFICER SHALL INCLUDE- (I) AN ORDER OF ASSESSMENT MADE BY THE ASSISTANT C OMMISSIONER OR THE INCOME- TAX OFFICER ON THE BASIS OF THE DIRECTIONS ISSUED B Y THE DEPUTY COMMISSIONER UNDER SECTION 144A; (II) AN ORDER MADE BY THE DEPUTY COMMISSIONER IN EX ERCISE OF THE POWERS OR IN THE PERFORMANCE OF THE FUNCTIONS OF AN ASSESSING OF FICER CONFERRED ON, OR ASSIGNED TO, HIM UNDER THE ORDERS OR DIRECTIONS ISS UED BY THE BOARD OR BY THE CHIEF COMMISSIONER OR DIRECTOR GENERAL OR COMMISSIO NER AUTHORISED BY THE BOARD IN THIS BEHALF UNDER SECTION 120; [ITA NO.563/IND/2019] [SHRI SANJAY KUMAR DARYANI, INDORE] 9 (B)' RECORD' 5 SHALL INCLUDE AND SHALL BE DEEMED A LWAYS TO HAVE INCLUDED] ALL RECORDS RELATING TO ANY PROCEEDING UNDER THIS ACT A VAILABLE AT THE TIME OF EXAMINATION BY THE COMMISSIONER; (C) WHERE ANY ORDER REFERRED TO IN THIS SUB- SECTIO N AND PASSED BY THE ASSESSING OFFICER HAD BEEN THE SUBJECT- MATTER OF ANY APPEAL, 6 FILED ON OR BEFORE OR AFTER THE 1ST DAY OF JUNE, 1988 ] THE POWERS OF THE COMMISSIONER UNDER THIS SUB- SECTION SHALL E XTEND 1 AND SHALL BE DEEMED ALWAYS TO HAVE EXTENDED] TO SUCH MATTERS AS HAD NOT BEEN CONSIDERED AND DECIDED IN SUCH APPEAL.] (2) 2 NO ORDER SHALL BE MADE UNDER SUB- SECTION (1) AFTE R THE EXPIRY OF TWO YEARS FROM THE END OF THE FINANCIAL YEAR IN WHICH THE ORD ER SOUGHT TO BE REVISED WAS PASSED.] (3) NOTWITHSTANDING ANYTHING CONTAINED IN SUB- SECTION (2), AN ORDER IN REVISION UNDER THIS SECTION MAY BE PASSED AT ANY TIME IN THE CASE OF AN ORDER WHICH HAS BEEN PASSED IN CONSEQUENCE OF, OR TO GIVE EFFECT TO , ANY FINDING OR DIRECTION CONTAINED IN AN ORDER OF THE APPELLATE TRIBUNAL, TH E HIGH COURT OR THE SUPREME COURT. EXPLANATION.- IN COMPUTING THE PERIOD OF LIM ITATION FOR THE PURPOSES OF SUB- SECTION (2), THE TIME TAKEN IN GIVING AN OPPOR TUNITY TO THE ASSESSEE TO BE REHEARD UNDER THE PROVISO TO SECTION 129 AND ANY PE RIOD DURING WHICH ANY PROCEEDING UNDER THIS SECTION IS STAYED BY AN ORDER OR INJUNCTION OF ANY COURT SHALL BE EXCLUDED. 9. THE HON'BLE DELHI HIGH COURT IN THE CASE OF ITO V S. DG HOUSING PROJECTS LTD. (SUPRA) HAS EXAMINED THE LAW ON THE ISSUE OF INITIATION OF PROCEEDINGS U/S 263 OF TH E ACT. THE HON'BLE HIGH COURT OBSERVED IN PARAS 7 & 8 AS UNDE R: [ITA NO.563/IND/2019] [SHRI SANJAY KUMAR DARYANI, INDORE] 10 10 THE HON'BLE DELHI HIGH COURT IN PARA-14 OF THE JUDGEMENT OBSERVED AS UNDER: [ITA NO.563/IND/2019] [SHRI SANJAY KUMAR DARYANI, INDORE] 11 11. HENCE, FROM THE ABOVE OBSERVATION OF THE HON'BLE COURT IT IS CLEAR THAT THERE ARE THREE CATEGORIES OF T HE CASES (I) WHERE THERE IS ENQUIRY BUT THE FINDINGS ARE INCORRECT/ERRONEOUS; (II) WHERE THERE IS FAILURE TO MAKE A PROPER OR FULL VERIFICATION OR ENQUIRY; AND (III) WHER E THE ASSESSING OFFICER HAD NOT MADE ANY ENQUIRY OR EXAMINED EVIDENCE WHATSOEVER. THERE WAS TOTAL ABSENCE OF ENQUIR Y OR VERIFICATION. THE HON'BLE HIGH COURT FURTHER HELD T HAT IN CASES OF WRONG OPINION OR FINDING ON MERITS THE CIT HAS TO COME TO THE CONCLUSION AND HIMSELF DECIDE THAT THE OR DER IS ERRONEOUS BY CONDUCTING NECESSARY ENQUIRY, IF REQUIRED AND NECESSARY BEFORE THE ORDER U/S 263 OF THE ACT IS PASS ED. IN SUCH CASES, THE ORDER OF THE A.O. WILL BE ERRONEOUS BECAUSE THE ORDER PASSED IS NOT SUSTAINABLE IN LAW AND THE SAID [ITA NO.563/IND/2019] [SHRI SANJAY KUMAR DARYANI, INDORE] 12 FINDING MUST BE RECORDED. CIT CANNOT REMAND THE MATT ER TO THE A.O. TO DECIDE WHETHER THE FINDINGS RECORDED ARE ERRONEOUS. IN CASES WHERE THERE IS INADEQUATE ENQUIRY BUT NOT LACK OF ENQUIRY THE CIT MUST GIVE AND RECORD THE FINDING THAT THE ORDER/ENQUIRY MADE IS ERRONEOUS. TH IS CAN HAPPEN IF AN ENQUIRY AND VERIFICATION IS CONDUCTED B Y THE CIT AND IS ABLE TO ESTABLISH AND SHOW THE ERROR O R MISTAKE MADE BY THE A.O. MAKING THE ORDER UNSUSTAINABL E IN LAW. IN SOME CASES, POSSIBLY THOUGH RARE, THE CIT CAN ALSO SHOW AND ESTABLISH THAT FACTS ON RECORD OR INFERENC ES FROM FACT ON RECORD PER SE JUSTIFIED AND MANDATED FURTH ER ENQUIRY OR INVESTIGATION BUT THE A.O. HAD ERRONEOUSLY NOT UNDERTAKEN THE SAME. HOWEVER, THE SAID FINDING MUST B E CLEAR AND UNAMBIGUOUS AND NOT DEBATABLE. THE MATTER CANNOT BE REMITTED FOR A FRESH DECISION TO THE A.O. T O CONDUCT FURTHER WITHOUT A FINDING THAT THE ORDER IS ERRONEOUS. FINDING THAT ORDER IS ERRONEOUS IS A COND ITION [ITA NO.563/IND/2019] [SHRI SANJAY KUMAR DARYANI, INDORE] 13 FOR REQUIREMENT WHICH MUST BE SATISFIED FOR EXERCISE OF JURISDICTION U/S 263 OF THE ACT. IN SUCH MATTER, TO REMAND THE MATTER TO THE A.O. WOULD IMPLY AND MEAN THAT THE CI T HAS NOT EXAMINED AND IT IS WHETHER OR NOT THE ORDER IS ERRONEOUS BUT HAS DIRECTED THE A.O. TO DECIDE THE ASPECT/QUESTION. IN THE LIGHT OF JUDGEMENT OF THE HO N'BLE DELHI HIGH COURT IN THE CASE OF ITO VS. DG HOUSING PROJECTS LTD. (SUPRA), IT CAN BE CONCLUDED THAT WHERE THERE IS ENQUIRY BUT THE FINDINGS ARE INCORRECT/ERRONEOUS AN D WHERE THERE IS FAILURE TO MAKE PROPER OR FULL VERIFIC ATION OR ENQUIRY, THE LD. CIT CANNOT REMIT THE MATTER WITHOUT COMING TO THE CONCLUSION AND HIMSELF DECIDING THAT OR DER IS ERRONEOUS BY CONDUCTING NECESSARY ENQUIRY, IF NECESSAR Y AND REQUIRED BEFORE THE ORDER U/S 263 OF THE ACT IS P ASSED. HOWEVER, IT WOULD NOT BE NECESSARY FOR THE LD. CIT T O MAKE FURTHER ENQUIRY WHETHER THE A.O. HAS NOT CONDUCTED ANY ENQUIRY OR EXAMINED EVIDENCE WHATSOEVER. THERE WAS TOT AL [ITA NO.563/IND/2019] [SHRI SANJAY KUMAR DARYANI, INDORE] 14 ABSENCE OF ENQUIRY OR VERIFICATION. BEFORE APPLYING TH IS RATIO, IT WOULD BE PROPER AND FOR THE SAKE OF CLARITY T O REPRODUCE THE FACTS WHICH WERE BEFORE THE HON'BLE DE LHI HIGH COURT, WHICH IS RECORDED IN PARA-8 OF THE JUDGE MENT AS FOLLOWS: 8. THE TRIBUNAL HAS SET ASIDE THE ORDER OBSERVING THAT THE CIT HAD NOT HELD AND COME TO THE CONCLUSION OR GIVEN A FINDING THAT THE ACTUAL RECEIPT OF CONSIDERATION WAS MORE THAN WHAT WAS DECLARED IN THE RETURN. THE CIT HAD NOT RECORDED ANY FINDING T HAT THE SALE CONSIDERATION OF THE PROPERTY WAS HIGHER. IT HAS B EEN HELD THAT THE CIT COULD NOT HAVE MADE ANY ADDITION UNDER SECTION 50C AS THE STAMP DUTY HAD NOT BEEN ENHANCED BY THE REGISTERING AUTHORITY AND THE SALE DEED WAS REGISTERED. IT WAS NOT THE CASE OF THE CIT THAT ANY EXTRA STAMP DUTY OVER AND ABOVE THE TRANSACTION VALUE WAS PAYABLE BECAUSE OF THE CIRCLE RATES. THE ORDER UND ER SECTION 263 OF THE ACT WAS SET ASIDE/CANCELLED. ACCORDINGLY, REVE NUE IS IN APPEAL. 12. IN THAT CASE, THE TRIBUNAL HAD SET ASIDE ORDER OBSERVING THAT THE CIT HAD NOT HELD AND COME TO THE CONCLUSION OR GIVEN A FINDING THAT THE ACTUAL RECEIPT O F CONSIDERATION WAS MORE THAN WHAT WAS DECLARED IN THE RETURN. THE CIT HAD NOT RECORDED ANY FINDING THAT TH E SALE CONSIDERATION OF THE PROPERTY WAS HIGHER. IT HAS BEEN HELD [ITA NO.563/IND/2019] [SHRI SANJAY KUMAR DARYANI, INDORE] 15 THAT THE CIT COULD NOT HAVE MADE ANY ADDITION U/S 50C OF THE ACT AS THE STAMP DUTY HAD NOT BEEN ENHANCED BY REGISTERING AUTHORITY AND SALE DEED WAS REGISTERED. IT WAS NOT THE CASE OF CIT THAT ANY EXTRA STAMP DUTY OVER AND ABOVE THE TRANSACTION VALUE WAS PAYABLE BECAUSE OF CIRCLE RATES. HENCE, THE ORDER U/S 263 OF THE ACT WAS SET AS IDE AND CANCELLED. HOWEVER, IN THE PRESENT CASE, THE REASO NS FOR INITIATING THE PROCEEDINGS U/S 263 OF THE ACT BY THE LD. CIT ARE REPRODUCED AS UNDER: A. IT IS OBSERVED THAT YOU HAD PURCHASED IMMOVABLE PROPERTY WHICH WAS THE BASEMENT OF THE BUILDING NAMED PALAK AVANUE ADMEASURING 3700 SQ.FT. 15.04.2013 FROM SH. KAILASH SAHU & SHRI MOTILAL SAHU, THROUGH POWER OF ATTORNEY HOLDER SH. KAMAL VERMA, INDORE FOR CONSIDERATION OF RS.1,25,00,000/- WHICH WAS PAID IN CASH TO SELLER I N VARIOUS DATE AND INCURRED REGISTRATION EXPENSES OF RS.14,08 ,345/- WHICH WAS ALSO PAID IN CASH. ON PERUSAL OF PURCHAS E DEED OF ABOVE SAID PROPERTY, IT WAS NOTICED THAT THE MARKE T VALUE OF THE PROPERTY WAS ADOPTED BY STAMP VALUATION AUTHORI TY FOR RS.1,80,53,000/-. AS SUCH, DIFFERENCE AMOUNT OF RS.55,53,000/- (1,80,53,000-1,25,00,000) WAS REQUIR ED TO BE ADDED BACK IN THE TOTAL INCOME OF THE ASSESSEE UNDE R THE HEAD OF INCOME FROM OTHER SOURCES AS PER PROVISIO NS OF SECTION 56(2)(VII)(B) OF I.T. ACT BUT THIS WAS NOT FOUND DONE IN SCRUTINY BY THE ASSESSING OFFICER. B. IT IS FURTHER OBSERVED THAT YOUR CONTENTION THA T YOU PAID REGISTRATION EXPENSES OUT OF YOUR SAVINGS AND CAPIT AL. ASSESSEE HAS SHOWN BUSINESS INCOME U/S 44AD OF I.T. ACT [ITA NO.563/IND/2019] [SHRI SANJAY KUMAR DARYANI, INDORE] 16 AND HAS NOT MAINTAINED BOOKS OF ACCOUNT ON PERUSAL OF RETURN OF 2014-15 THERE WAS NO CAPITAL ACCOUNT FOUND. IN VIEW OF ABOVE, THE REGISTRATION EXPENSES OF RS.14,08,345/- REMAINED UNPROVED/UNEXPLAINED, HENCE APPARENTLY THE REGISTRA TION EXPENDITURE WAS PAID FROM UNDISCLOSED INCOME, AND W AS LIABLE TO BE TAXED WHICH HAS NOT BEEN DONE BY A.O. 13. HENCE, THERE IS A CLEAR DISTINCTION BETWEEN THE FACTS OF THE CASE THAT WAS BEFORE THE HON'BLE DELHI HI GH COURT AND THE CASE BEFORE US. AS IN THE PRESENT CASE, THE LD. CIT HAS CATEGORICALLY RECORDED A FINDING ON FACT TH AT ON PERUSAL OF PURCHASE DEED OF THE PROPERTY IN QUESTION, IT WAS NOTICED THAT THE MARKET VALUE OF THE PROPERTY WAS ADOPT ED BY STAMP VALUATION AUTHORITY FOR RS.1,80,53,000/-, WHEREAS THE ASSESSEE HAD DECLARED SALE CONSIDERATION AT RS.1,25,00,000/-. AS SUCH DIFFERENCE AMOUNT OF RS.55,53,000/- (RS.1,80,53,000 (MINUS) RS.1,25,00,0 00/-) WAS REQUIRED TO BE ADDED BACK IN THE TOTAL INCOME OF TH E ASSESSEE UNDER THE HEAD INCOME FROM OTHER SOURCES AS PER PROVISIONS OF SECTION 56(2)(II)(B) OF THE ACT. BUT THIS WAS NOT FOUND DONE IN THE SCRUTINY BY THE A.O. IT WAS F URTHER [ITA NO.563/IND/2019] [SHRI SANJAY KUMAR DARYANI, INDORE] 17 OBSERVED THAT THE ASSESSEE HAD CLAIMED REGISTRATION EXPENSES OUT OF SAVING AND CAPITAL BUT THE ASSESSEE HAS DISCLOSED BUSINESS INCOME U/S 44AD OF THE ACT AND HAS NOT MAINTAINED BOOKS OF ACCOUNTS. ON PERUSAL OF RETURN OF INCOME PERTAINING TO THE ASSESSMENT YEAR 2014-15, THER E WAS NO CAPITAL ACCOUNT FOUND. HENCE, THE EXPENDITURE INCURRED ON REGISTRATION AMOUNT TO RS.14,08,345/- REMAINED UNPROVED/UNEXPLAINED. THE LD. CIT WAS OF THE VIEW THAT APPARENTLY THE REGISTRATION EXPENDITURE WAS P AID ON UNDISCLOSED INCOME AND WAS LIABLE TO BE TAXED WHIC H HAS NOT BEEN DONE BY THE ASSESSEE. 14. DURING THE COURSE OF HEARING, LD. COUNSEL FOR TH E ASSESSEE WAS SPECIFICALLY ASKED TO POINT OUT FROM THE RECORDS THAT ANY ENQUIRY WAS CONDUCTED BY THE A.O. REGARDING THE VALUE ADOPTED BY THE STAMP VALUATION AUTHORITY OF THE PROPERTY IN QUESTION. HE COULD NOT BROUGHT TO OUR NOTICE ANY SUCH QUERY OR NOTICE ISSUED BY TH E A.O. [ITA NO.563/IND/2019] [SHRI SANJAY KUMAR DARYANI, INDORE] 18 HENCE, IT CAN BE SAFELY INFERRED THAT THE FACTS OF THE PRESENT CASE WOULD FALL WHERE THE A.O. DID NOT CONDUCT ANY ENQU IRY OR EXAMINED THE EVIDENCE WHATSOEVER RELATED TO THE ISS UE UNDER CONSIDERATION. THERE WAS TOTAL ABSENCE OF ENQUIR Y OR VERIFICATION. THEREFORE, WE DO NOT SEE ANY INFIRMITY INTO THE ACTION OF THE LD. CIT FOR SETTING ASIDE THE ASSESSMENT ORDER AND REMITTING THE ASSESSMENT TO THE FILE OF THE A.O. WITH A DIRECTION TO EXAMINE THE ISSUES OF DIFFERENCE OF MARK ET VALUE OF THE PROPERTY IN QUESTION AND VERIFYING THE SO URCE OF EXPENDITURE INCURRED ON REGISTRATION OF THE PROPERTY AFTER AFFORDING PROPER OPPORTUNITY TO THE ASSESSEE. LD. CO UNSEL FOR THE ASSESSEE HAS PLACED ON RECORD A VALUATION REPORT THAT WAS NOT BEFORE THE AUTHORITIES BELOW. WE THEREFO RE, IN THE INTEREST OF JUSTICE ADMIT THIS VALUATION REPORT AS ADDITIONAL EVIDENCE AND MODIFY THE DIRECTION OF THE LD . CIT TO THE EXTENT THAT WHILE FRAMING THE ASSESSMENT, THE A .O. WOULD ALSO CONSIDER THE OBJECTION OF THE ASSESSEE REG ARDING [ITA NO.563/IND/2019] [SHRI SANJAY KUMAR DARYANI, INDORE] 19 ADOPTION OF THE MARKET VALUE OF THE PROPERTY AND DECID E THE ISSUE IN ACCORDANCE WITH LAW. IN THE LIGHT OF THE ABO VE DISCUSSION, THE GROUND NOS.1 & 2 OF THE APPEAL ARE DISMISSED. HOWEVER, GROUND NO.3 IS PARTLY ALLOWED FO R STATISTICAL PURPOSES AND GROUND NO.4 IS GENERAL IN NATUR E NEEDS NO SEPARATE ADJUDICATION. 15. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES IN THE TERMS AS INDIC ATED HEREIN ABOVE. ORDER WAS PRONOUNCED IN THE OPEN COURT ON 24 . 10.2019. SD/- (MANISH BORAD) SD/- (KUL BHARAT) A CCOUNTANT MEMBER JUDICIALMEMBER INDORE; DATED : 24/10/2019 VG/SPS COPY TO: ASSESSEE/AO/PR. CIT/ CIT (A)/ITAT (DR)/GUAR D FILE. BY ORDER ASSISTANT REGISTRAR, INDORE