M/s Seven Star Developers, Pune V. Income-Tax Officer, Pune

ITA 598/PUN/2021

• Counselvise Citation: [2022] 105 COUNSELVISE.COM (IT) 1085 (ITAT-PUNE)
• Duration Of Justice: 6 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-05-2022
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: SMC
• Assessment Year: 2015-2016
• Appeal Filed On: 02-11-2021
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Sale consideration of property below Jantri Value; Retrospective amendment
• Section: 43CA; 143(3); 50C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH “SMC”, PUNE BEFORE SHRI S. S. GODARA, JUDICIAL MEMBER आयकर अपील सं. / ITA No.598/PUN/2021 िनधाᭅरण वषᭅ / Assessment Year: 2015-16 M/s. Seven Star Developers, S.No.14/1/2/3, Shop No.2, Shubham Residency, Dhayari, Pune-411041. PAN : ACCFS1198P Vs. ITO, Ward-6(2), Pune. Appellant Respondent आदेश / ORDER PER S. S. GODARA, JM: This assessee’s appeal for assessment year 2015-16 arises against the CIT(A)-4 Pune’s order dated 26.02.2020 passed in case no. PN/CIT(A)-4/Ward-6(2),Pune/177/2017-18 involving proceedings u/s 143(3) of the Income Tax Act, 1961; in short the Act. Heard both the parties. Case file perused. 2. It emerges at the outset that instant appeal suffers from 378 days delay in filing. I find that the CIT(A) has passed his lower Assessee by : Shri J. R. Chandrakar Revenue by : Shri Arvind Desai Date of hearing : 24.05.2022 Date of pronouncement : 26.05.2022 ITA No.598/PUN/2021 2 appellate order on 26.02.2020 which followed outbreak of Covid-19 Pandemic during which the assessee filed the instant appeal on 22.11.2021. The Revenue could hardly dispute that hon’ble apex court latest directions in Cognizance for Extension of Limitation, 438 ITR 296 (SC) read with judgment in Cognizance for Extension of Limitation, 432 ITR 206 (SC) dated 08-03-2021 and 421 ITR 314 have made it clear that the lockdown periods between 15.03.2020 to 14.03.2021 shall extend excluded from all prescribed limitations. I therefore condone the impugned delay neither intentional nor deliberate. 3. Coming to the assessee’s former substantive ground that both the learned lower authorities have erred in law and on facts in making section 43CA addition of Rs.12,20,150/-, Mr. Desai could hardly dispute that the same represents less than 10% difference between the actual sale price vis-à-vis SRO rates of the twin flats in “Avnish Regency” project. 4. Mr. Desai vehemently argued at the Revenue’s behest that the foregoing twin tolerance margins do not carry any retrospective effect. I find no reason to accept the instant argument as section 43CA applies in an instance of “transfer of assets other than capital assets in certain cases” which is pari materia to section 50C ITA No.598/PUN/2021 3 applicable when a capital asset is transferred. The legislature appears to have introduced the foregoing twin tolerance margins of “5%” and “10%” vide Finance Act, 2018 w.e.f. 1.4.2019 as substituted in the Finance Act, 2020 w.e.f. 1.4.2021; respectively in section 50C of the Act. This tribunal’s co-ordinate bench(es) in Sri Himmatbhai Dharamshibhai Sonani vs. ACIT (2016) 75 taxmann.com 141 (Ahd) and Maria Fernandes Cheryl vs. ITO ITA No.4850/Mum/2019 dated 15.01.2021 hold the same to be having retrospective effect. Mr. Desai could hardly dispute the clinching fact that the CBDT Circular No.8 of 2018 titled “Explanatory Notes to the provisions of the Finance Act, 2011” treated both section 43CA as well as section 50C as pari materia only. I therefore adopt the very reasoning herein as well to delete the impugned addition(s) made u/s 43CA of the Act. I accordingly delete the impugned addition. The assessee succeeds in the instant former substantive ground. 5. Next comes adhoc disallowance issue involving addition of Rs.1,50,000/- in respect of wages, site expenses and labour charges which has been made on estimation basis. I find that neither the assessee has been able to file all of the necessary details supporting the impugned claim nor the learned lower authorities have given ITA No.598/PUN/2021 4 any basis for the impugned estimation. Faced with this situation, I hold that a lump sum disallowance of Rs.1,00,000/- only would be just and proper with a rider that the same shall not be treated as a precedent. Ordered accordingly. Necessary computation shall follow as per law. No other grounds has been pressed during the course of hearing. 6. This assessee’s appeal is partly allowed in above terms. Order pronounced on this 26 th day of May, 2022. Sd/- (S. S. GODARA) JUDICIAL MEMBER पुणे / Pune; ᳰदनांक / Dated : 26 th May, 2022. Sujeet (DOC) आदेश कᳱ ᮧितिलिप अᮕेिषत / Copy of the Order forwarded to : 1. अपीलाथᱮ / The Appellant. 2. ᮧ᭜यथᱮ / The Respondent. 3. The CIT(A)-4, Pune. 4. The Pr. CIT-3, Pune. 5. िवभागीय ᮧितिनिध, आयकर अपीलीय अिधकरण, “SMC” बᱶच, पुणे / DR, ITAT, “SMC” Bench, Pune. 6. गाडᭅ फ़ाइल / Guard File. आदेशानुसार / BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण, पुणे / ITAT, Pune.