Sankar Sarkar, Kolkata V. ACIT Circle 26, Kolkata, Kolkata

ITA 992/KOL/2017

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 3824 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 3 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-08-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Assessment Year: 2013-2014
• Appeal Filed On: 09-05-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: PINAKI MUKHERJEE CIT DR REVE
• Assessee Lawyers: MANISH TIWARI
• Keywords: Unexplained cash credit; Sale consideration of property below Jantri Value; Value adopted by valuation officer; Capital asset; Fair market value; Onus to prove; Revenue expenditure; Set aside
• Section: 40A(3); 143(3); 50C; 250; 131; 68; 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA C BENCH, KOLKATA (BEFORE SRI J. SUDHAKAR REDDY, ACCOUNTANT MEMBER & SRI S.S. VISWANETHRA RAVI, JUDICIAL MEMBER) I.T.A. NO. 992/KOL/2017 ASSESSMENT YEAR: 2013-14 SANKAR SARKAR.....................APPELLANT NANDAN COLONY RAKHAL GHOSH ROAD RAJPUR KOLKATA 700 149 [PAN : AKLPS 7841 N] VS. ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-26 KOLKATA.........RESPONDENT APPEARANCES BY: SHRI MANISH TIWARI, FCA, APPEARED ON BEHALF OF THE ASSESSEE. SHRI PINAKI MUKHERJEE, ADDL. CIT, D/R APPEARING ON BEHALF OF THE REVENUE. DATE OF CONCLUDING THE HEARING : JULY 24 TH , 2019 DATE OF PRONOUNCING THE ORDER : AUGUST 14 TH , 2019 ORDER PER J. SUDHAKAR REDDY, AM :- THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) - 7, (HEREINAFTER THE LD. CIT (A)), PASSED U/S 250 OF THE INCOME TAX ACT, 1961 (THE ACT), DT. 29/03/2017, FOR THE ASSESSMENT YEAR 2013- 14 2. THE ASSESSEE IS AN INDIVIDUAL AND DERIVES INCOME FROM BUSINESS AND CAPITAL GAINS. HE FILED HIS RETURN OF INCOME FOR THE ASSESSMENT YEAR 2013-14 ON 10/02/2015 DECLARING TOTAL INCOME OF RS.4,08,54,310/-. THE ASSESSING OFFICER COMPLETED THE ASSESSMENT U/S 143(3) OF THE ACT DETERMINING THE TOTAL INCOME AT RS.6,26,36,770/-, INTERALIA MAKING AN ADDITION U/S 68 OF RS.1,01,80,000/- AND ADDITION U/S 50C OF RS.85,52,959/-. DISALLOWANCE WERE ALSO MADE U/S 40A(3) OF THE ACT. AGGRIEVED THE ASSESSEE CARRIED THE MATTER IN APPEAL. THE LD. FIRST APPELLATE AUTHORITY CALLED FOR A REMAND REPORT FROM THE ASSESSING OFFICER AND THEREAFTER CONFIRMED THE ADDITION MADE U/S 68 OF THE ACT AS UNEXPLAINED CASH CREDIT. ON THE ISSUE OF ADDITION U/S 50C OF THE ACT, HE HELD THAT, WHEREVER AN ASSESSEE WAS ONLY A CONFIRMING PARTY TO A SALE DEED, SECTION 50C OF THE ACT IS NOT APPLICABLE. ONLY IN THE CASE OF SALE DEED NO. 254/13 OF PICNIC GARDENS, THE ADDITION MADE U/S 50C OF THE ACT, WAS SUSTAINED BY THE LD. CIT(A). ON THE DISALLOWANCE U/S 2 I.T.A. NO. 992/KOL/2017 ASSESSMENT YEAR: 2013-14 SANKAR SARKAR 40A(3) OF THE ACT, THE ASSESSING OFFICER WAS DIRECTED TO EXAMINE WHETHER, THE ASSESSEE HAD CLAIMED EXPENSES IN QUESTION IN HIS PROFIT AND LOSS ACCOUNT AND IF ANY SUCH CLAIM WAS MADE, THE ADDITION WAS DIRECTED TO BE DELETED. 3. AGGRIEVED THE ASSESSEE IS BEFORE US ON THE FOLLOWING GROUNDS:- 1. THAT LEARNED CIT(A) HAS SERIOUSLY ERRED IN DISBELIEVING THE SUM OF RS.10180000 ADVANCED BY DEVOTEES AND HOLDING THEM TO THE APPELLANTS OWN UNACCOUNTED MONEY IN THE BOOKS WITHOUT ANY STRONG FOUNDATION AND FURTHER IGNORING THE FACT OF NON-DENIAL OF THE TRANSACTION BY ANY WITNESS EXAMINED DURING REMAND PROCEEDINGS. 2. THAT THE APPELLANT RESERVES THE RIGHT TO RAISE, MODIFY, RESCIND ANY OF THE GROUND DURING HEARING. THE ASSESSEE ALSO FILED THE FOLLOWING ADDITIONAL GROUNDS OF APPEAL- 1. THAT LEARNED CIT (A) HAS SERIOUSLY ERRED IN DISBELIEVING THE SUM OF RS. 1,01,80,000/- ADVANCED BY DEVOTEES AND HOLDING THEM TO THE APPELLANT'S OWN UNACCOUNTED MONEY IN THE BOOKS WITHOUT ANY STRONG FOUNDATION AND FURTHER IGNORING THE FACT OF NON-DENIAL OF THE TRANSACTION BY ANY WITNESS EXAMINED DURING REMAND PROCEEDINGS. 2. THAT THE LD CIT (A) HAS ERRED IN GIVING DIRECTIONS FOR BRINGING THE DIFFERENTIAL BETWEEN SALE CONSIDERATION AND STAMP DUTY VALUE TO TAXATION FOR SALE OF PICNIC GARDEN LANE NOTWITHSTANDING THE FACT OF NON -REFERENCE TO VALUATION OFFICER. 3. THAT THE CIT (A) HAS ERRED IN CONFIRMING DISALLOWANCE OF RS. 1,10,000/- AND RS. 6,50,000/- U/S 40A(3) WITHOUT APPRECIATING THE FACT THAT THE SAME WAS NOT CLAIMED AS EXPENDITURE. 4. THAT THE APPELLANT RESERVES THE RIGHT TO RAISE, MODIFY, RESCIND ANY OF THE GROUND DURING HEARING. 4. WE HAVE HEARD SHRI MANISH TIWARI, FCA, THE LD. COUNSEL FOR THE ASSESSEE AND SHRI PINAKI MUKHERJEE, ADDL. CIT D/R, ON BEHALF OF THE REVENUE. ON CAREFUL CONSIDERATION OF THE FACTS AND CIRCUMSTANCES OF THE CASE, PERUSAL OF THE PAPERS ON RECORD, ORDERS OF THE AUTHORITIES BELOW AS WELL AS CASE LAW CITED, WE HOLD AS FOLLOWS:- 5. THE FIRST ISSUE IS AN ADDITION OF RS.1,01,80,000/-, AS UNEXPLAINED CASH CREDIT U/S 68 OF THE ACT. THE ASSESSEE SUBMITTED THAT HE WAS THE PRESIDENT OF SANATAN DAL SANSTHAN AND THAT THE DEVOTEES OF THE SANSTHAN HAD GREAT FAITH AND BELIEF IN HIM AND HENCE THEY CHOSE TO INVEST THE SAID MONEY WITH THE ASSESSEE. THE ASSESSEE SUBMITTED A LIST OF 635 PERSONS WITH, IDENTIFICATIONS IN THE FORM OF VOTER-ID CARDS/AADHAR CARDS/RATION CARD 3 I.T.A. NO. 992/KOL/2017 ASSESSMENT YEAR: 2013-14 SANKAR SARKAR DETAILS/ FOR THEIR NAMES AND ADDRESSES. THE EXPLANATION GIVEN BY THE ASSESSEE IS EXTRACTED FOR READY REFERENCE:- B. CASH CREDIT U/S 68 - IDENTITY GENUINENESS AND CREDIT WORTHINESS. THE ASSESSEE IS ENGAGED IN THE BUSINESS OF LAND DEVELOPMENT, CONSTRUCTION OF PROPERTIES. HE IS ALSO THE PRESIDENT OF 'SANTAN DAL', A RELIGIOUS GROUP WHICH HAS BEEN FORMED BY ILLUSTRIOUS PHILANTHROPIST LATE BALAK BHRAMACHARI. THE GROUP HAS A LOT OF FOLLOWERS AMONG VARIOUS STRATA OF SOCIETY ACROSS WEST BENGAL. IN THE COURSE OF ASSESSMENT A CASH FLOW STATEMENT WAS PRESENTED, IN THE SAID STATEMENT IT WAS DULY DISCLOSED THAT HE HAS RECEIVED RS, 1,01,80,000/-. HOWEVER, THE A.O. DID NOT MAKE ANY VERIFICATION OF THE DETAILS AND HAD GONE ON TO MAKE THE ADDITION U/S 68 WITHOUT GOING THROUGH THE DETAILS. IT IS QUITE STRANGE THAT UNDER SIMILAR CIRCUMSTANCES THE A.O. WAS SATISFIED IN THE NEXT YEAR AND HAS GONE ON TO MAKE AN ADDITION OF RS.1,15,5001- ONLY ON ACCOUNT OF NON APPEARANCE OF CERTAIN PERSONS. THUS UNDER IDENTICAL CIRCUMSTANCES TWO DIFFERENT CONCLUSIONS ARE DRAWN. FURTHER, IT IS ALSO RELEVANT TO NOTE THAT FROM THE STATEMENTS RECORDED IN SUBSEQUENT STAGES THAT THERE IS NO SPECIFIC DENIAL OF THE TRANSACTIONS BY THE PERSONS. THUS IDENTITY AND GENUINENESS OF THE TRANSACTIONS HAS BEEN PROVED TO THE HILT. AS REGARDS CREDIT WORTHINESS IT IS RESPECTFULLY SUBMITTED THAT THERE IS NO COGENT EVIDENCE WITH THE DEPARTMENT THAT THE DEPOSITIONS MADE WERE FALSE AND TO JUSTIFY THAT THEY DID NOT HAVE THE MEANS TO ADVANCE. THEREAFTER IN THE COURSE OF THE APPEAL PROCEEDINGS, A COMMISSION WAS ISSUED TO ADIT (LNV) JALPAIGURI WHO SUMMONED CERTAIN PERSONS U/S 131. THERE WAS COMPLETE CO-OPERATION AND ALL THE PERSONS DEPOSED CONFIRMED THAT THEY HAVE GIVEN THE LOAN. THEIR IDENTITY AND GENUINENESS HAVE BEEN DULY PROVED. HOWEVER, IT HAS BEEN OBSERVED THAT JUST BECAUSE APPARENTLY THEY DO NOT SEEM TO HAVE THE MEANS, THEIR POSITIVE CONFIRMATION WAS DISREGARDED. THE LD. CIT (A) HAS SIMPLY JUMPED UPON THE CONCLUSION WITHOUT GIVING A CHANCE OF REBUTTAL. STRONG OBJECTION IS PLACED ON THE WORDS 'APPARENTLY' BECAUSE LAW DOES NOT RECOGNIZE THAT ONLY AN ATTRACTIVE PERSON HAS GOT MEANS. NO DEFECT HAS BEEN POINTED OUT IN THE AGREEMENT. THE DATE OF EXECUTION HAS BEEN MENTIONED THEREIN. THE PERSONS HAVE PLACED THESE DOCUMENTS. IN SPITE OF THESE POSITIVE ACTS, IT IS NOT CLEAR AS TO WHY ALLEGATION IS MADE OF NOT MENTIONING THE DATES. MOREOVER, WHEN WRITTEN EVIDENCES ARE CLEAR, THERE IS NO SCOPE OF ANY ASSUMPTION OF NOT REMEMBERING THE DATES AFTER A SPAN OF NEARLY FIVE YEARS. IT IS PERTINENT TO NOTE THAT AO HAS ONLY DRAWN ATTENTION TO THE REPORT OF ADIT (LNV) UNIT-1JALPAIGURI. THE HON'BLE CIT (A) HAS ASSUMED AND PRESUMED CERTAIN FACTS REGARDING THE INCOME OF THOSE PARTIES AND THEIR CAPACITY TO HAVE SPARE MONEY. HAVING INCOME BELOW TAXABLE LIMIT DOES NOT MEAN THAT THEY LIVE IN DIRE STATE OF FINANCIAL HARDSHIP BECAUSE MOST OF THESE PERSONS HAVE INCOME FROM AGRICULTURE. EVEN OTHERWISE IT BECOMES IMPERATIVE TO METICULOUSLY ANALYSE THE RESPONSE TO QUESTIONS PUT FORWARD BY THE ADIT (INV) JALPAIGURI, SO THAT THE REPLIES CAN BE PROPERLY ANALYSED. IT IS HUMBLY SUBMITTED THAT ON A MERE SURMISE AND CONJECTURE, ADDITION CANNOT BE PERPETRATED. 5.1. THE ASSESSING OFFICER DURING THE COURSE OF ASSESSMENT PROCEEDINGS HAS AT PAGE 6 OF HIS ORDER MADE THE ADDITION ON THE GROUND THAT THE ASSESSEE HAS FAILED TO SUBMIT ANY 4 I.T.A. NO. 992/KOL/2017 ASSESSMENT YEAR: 2013-14 SANKAR SARKAR CREDIBLE DOCUMENTS IN SUPPORT OF HIS CONTENTIONS. WHEN THE MATTER TRAVELLED TO THE LD. CIT(A), A REMAND REPORT WAS CALLED FOR. THE ASSESSING OFFICER, INSTEAD OF HIMSELF DOING THE ENQUIRY, CHOSE TO ENTRUST THE JOB OF INVESTIGATION, TO THE INVESTIGATION WING OF THE DEPARTMENT. THE ADIT (INV.) UNIT-1, JALAPAIGURI, ISSUED SUMMONS U/S 131 OF THE ACT, TO 16 PERSONS AMONG THE MANY DEPOSITORS. IN RESPONSE TO THESE SUMMONS, 15 PERSONS APPEARED BEFORE THE ADIT (INV.) AND WERE EXAMINED ON OATH. ALL THESE PERSONS STATED ON OATH THAT THEY HAVE ADVANCED THESE AMOUNTS TO THE ASSESSEE. THEY PRODUCED A COPY OF THE AGREEMENT BETWEEN THEM AND THE ASSESSEE AS PROOF OF INVESTMENT. THE ADIT (INV.), CHOSE NOT TO EXAMINE ANY OTHER PERSON. ON THE BASIS OF THESE SAMPLES, HE CAME TO THE FOLLOWING CONCLUSION:- NONE OF THE ABOVE PERSONS WERE FOUND TO BE FILING THEIR RETURN OF INCOME AND APPARENTLY APPEARS TO BE PERSONS OF LITTLE MEANS. THOUGH ALL THE ABOVE PERSONS HAD STATED TO HAVE MADE ADVANCE IN CASH TO SRI SANKAR SARKAR AS DETAILS ABOVE, HOWEVER NONE WERE ABLE TO SPECIFY THE DATE OR EVEN THE MONTH AND AS NO RECORDS ARE MAINTAINED OF THEIR OCCUPATIONS THE GENUINENESS OF TRANSACTION MADE COULD NOT BE VERIFIED. THE ONLY EVIDENCE PRODUCED WAS THE COPY OF AGREEMENT (PHOTOCOPY) WHICH ALONG WITH COPY OF STATEMENT RECORDED AND DOCUMENTS FURNISHED BY THEM ARE ENCLOSED HEREWITH FOR NECESSARY ACTION AT YOUR END. 5.2. THE LD. CIT(A) AT PARA 6.5., HE HELD AS FOLLOWS:- 6.5 I HAVE PERUSED THE ASSESSMENT ORDER, SUBMISSION OF THE ASSESSEE, ADIT'S REPORT AND THE REMAND REPORT. IN ASSESSMENT PROCEEDINGS THE TEST IS PREPONDERANCE OF PROBABILITY THE ISSUE HAS TO BE LOOKED AT FROM THE POINT OF VIEW AS TO WHETHER THE EXPLANATION GIVE BY THE ASSESSING OFFICER IS MOST PROBABLY TRUE OR IS IT MOST LIKELY TO BE FALSE. CONSIDERING THAT (A) THE ASSESSEE HAS CLAIMED THAT IT HAS RECEIVED MORE THAN RS. 1 CRORE FROM 635 DEVOTEES FOR ITS BUSINESS THIS SEEMS' TO BE LESS PROBABLE. AS CONVINCING SO MANY PEOPLE TO GIVE INTEREST FREE LOAN IN CASH IS UNLIKELY. (B) MOST OF THIS PARTIES HAS INCOME BELOW TAXABLE LIMIT AND THEREFORE ARE LIKELY TO HAVE VERY LITTLE SPARE MONEY TO GIVE INTEREST FREE LOAN. (C) NONE OF, THESE PARTIES ARE ABLE TO SPECIFY THE DATE OR MONTH FOR GIVING THESE LOAN. IF THIS PEOPLE WHO' ARE MEN OF SMALL MEANS WOULD HAVE GIVEN ADVANCES TO THE .ASSESSEE THEN THEY WOULD HAVE DEFINITELY REMEMBERED AS TO WHEN THEY HAVE GIVEN MONEY TO THE ASSESSEE. IN VIEW OF THE ABOVE I AM OF THE OPINION THAT THE ASSESSEE IS MAKING A STORY TO DISGUISE HIS OWN UNACCOUNTED MONEY BROUGHT IN THE BOOKS. THEREFORE THE ADDITION OF RS. 10180000/ - IS HEREBY CONFIRMED. 5 I.T.A. NO. 992/KOL/2017 ASSESSMENT YEAR: 2013-14 SANKAR SARKAR 6. IN OUR VIEW, THE ADDITION CANNOT BE MADE MERELY ON SUCH SURMISES AND CONJECTURES. THERE IS NO ADVERSE MATERIAL TO SHOW THAT THE TRANSACTIONS IN QUESTION ARE NOT GENUINE. ON THE OTHER HAND, THE ASSESSEE HAS PRODUCED DOCUMENTS TO PROVE THE GENUINENESS OF THE TRANSACTIONS. EVEN THE VERIFICATIONS MADE BY THE ADIT (INV.) DID NOT YIELD ANY ADVERSE RESULTS. COPY OF THE ARGUMENTS WERE FILED WHICH GIVE THE DATE AND MONTH IN WHICH THE ADVANCE WAS GIVEN. THE AMOUNTS GIVEN WERE SMALL AND THERE IS NO REQUIREMENT OF HUGE INCOME TO LEND SUCH SMALL AMOUNTS. THERE IS NO BASIS GIVEN AS TO HOW THE LOWER AUTHORITIES CONCLUDED THAT THE PERSONS WHO HAVE GIVEN THESE AMOUNTS WERE OF NO MEANS. IT IS NOT A CASE WHERE THE LOANS WERE TAKEN WITHOUT INTEREST. IN FACT IN THE STATEMENTS RECORDED BY THE ADIT, IN RESPONSE TO QUESTION NO. 10, STATES THAT THE ASSESSEE HAD REPAID HIS AMOUNTS ALONG WITH INTEREST. SIMILARLY, ANSWERS WERE GIVEN BY SHRI AJIT ROY AND OTHER DURING THE COURSE OF EXAMINATION ON OATH. ALL THESE PERSONS HAVE CONFIRMED THE TRANSACTIONS ON OATH. THE ASSESSEE HAS FILED DETAILED CASH FLOW STATEMENTS BEFORE THE ASSESSING OFFICER TO EXPLAIN THE TRANSACTIONS. NO DEFECTS WERE POINTED OUT IN THE SAME. THE LD. CIT(A) WAS FACTUALLY INCORRECT IN STATING THAT THESE ARE INTEREST FREE LOANS. IN THE CASE OF CASH CREDITS EACH TRANSACTIONS HAS TO BE EXAMINED INDEPENDENTLY AND ADDITIONS CANNOT BE MADE BASED ON GENERAL AND SWEEPING OBSERVATIONS. PREPONDERANCE OF PROBABILITIES CANNOT REPLACE FACTS AND EVIDENCES. 6.1. PERSONS WHO DO NOT HAVE TAXABLE INCOMES AND WHO MAINLY DERIVE INCOME FROM AGRICULTURE ARE NOT REQUIRED TO FILE THEIR RETURNS OF INCOME. WHEN NO ADVERSE MATERIAL OR STATEMENT CAN BE BROUGHT ON RECORD BY THE ASSESSING AUTHORITIES IT WOULD BE INCORRECT TO COME TO A CONCLUSION THAT THE TRANSACTIONS IN QUESTION, ARE NOT GENUINE. THE LD. D/R REQUESTED THAT THE MATTER BE RESTORED ONCE AGAIN TO THE FILE OF THE ASSESSING OFFICER FOR FRESH INVESTIGATION. THIS IS A CASE WHERE THE ASSESSING OFFICER HAD OPPORTUNITY DURING THE ORIGINAL PROCEEDINGS AS WELL AS IN THE REMAND PROCEEDINGS TO INVESTIGATE THE ISSUE. HE CHOSE TO REQUEST THE INVESTIGATION WING TO INVESTIGATE, AND THE INVESTIGATION WING EXAMINED THE ISSUE AND REPORTED BACK TO THE ASSESSING OFFICER. UNDER THESE CIRCUMSTANCES, IN OUR VIEW, IT IS NOT A FIT CASE TO ORDER ONE MORE ROUND OF INVESTIGATION. IN OUR VIEW THE ASSESSEE HAS DISCHARGED THE BURDEN OF PROOF THAT LAYS ON HIM. THE REVENUE HAS NO MATERIAL TO CONTROVERT THE CLAIMS OF THE ASSESSEE. IN VIEW OF THE ABOVE DISCUSSION, WE DELETE THE ADDITION MADE U/S 68 OF THE ACT, ON THE 6 I.T.A. NO. 992/KOL/2017 ASSESSMENT YEAR: 2013-14 SANKAR SARKAR GROUND THAT THE UNSECURED LOANS CASH CREDITS ARE UNEXPLAINED. HENCE GROUND NO. 1 OF THE ASSESSEE IS ALLOWED. 6.2. GROUND NO. 2 IS ON THE ADDITION MADE U/S 50C OF THE ACT. THE SALE CONSIDERATION DECLARED BY THE ASSESSEE IN ITS SALE DEED OF PROPERTY AT PICNIC GARDEN, IS RS.4,31,50,000/- AND WHEREAS THE STAMP DUTY VALUE AS PER REGISTRATION AUTHORITY IS RS.4,79,28,261/-. THE DIFFERENCE IS RS.47,78,261/-. THE DIFFERENCE IN VALUE OF RS.47,78,261/- AS A PERCENTAGE OF STAMP DUTY VALUE OF RS.4,79,28,261/- IS 9.96%. THE HYDERABAD A BENCH OF THE TRIBUNAL IN THE CASE OF ACIT VS. SMT. S. SUVARNA REKHA IN I.T.A. NO. 743/HYD/2009, ORDER DT. 29/10/2010 , AT PARA 9 HELD AS FOLLOWS:- 9. LET US NOW EXAMINE SECTION 50C OF THE ACT. SECTION 50C EMPOWERS THE ASSESSING OFFICER TO TAKE THE GUIDELINES VALUE AS FULL VALUE OF CONSIDERATION IN CASE THE SALE CONSIDERATION IS LESS THAN THE VALUE ADOPTED BY THE CONCERNED AUTHORITIES FOR THE PURPOSE OF VALUATION OF STAMP DUTY. HOWEVER, WHEN THE ASSESSEE CLAIMS THAT THE VALUE ADOPTED BY THE STAMP DUTY VALUATION AUTHORITY EXCEEDS THE FAIR MARKET VALUE THE ASSESSING OFFICER MAY REFER THE MATTER TO THE VALUATION OFFICER TO ESTIMATE THE VALUE OF THE CAPITAL ASSET. AFTER REFERENCE TO VALUATION OFFICER, IF THE VALUE ESTIMATED BY THE VALUATION OFFICER EXCEEDS THE VALUE ADOPTED BY THE STAMP DUTY VALUATION AUTHORITY THEN THE ASSESSING OFFICER SHALL TAKE THE VALUATION OF THE STAMP DUTY VALUATION AUTHORITY AS FULL VALUE OF CONSIDERATION FOR THE PURPOSE OF COMPUTING CAPITAL GAIN. IN THE CASE BEFORE US AS ON 19.8.2005 THE GUIDELINES VALUE FOR THE PROPERTY IS RS.12,000 PER SY. HOWEVER, THE SALE CONSIDERATION SHOWN IN THE SALE DEED IS ONLY RS.7000 PER SY. THE TOTAL CONSIDERATION RECEIVED BY THE ASSESSEE IS RS.70 LAKHS. ON A REFERENCE TO THE VALUATION OFFICER, THE VALUATION OFFICER ESTIMATED THE VALUE OF THE PROPERTY AT RS.75,76,712. ADMITTEDLY THE DIFFERENCE BETWEEN THE VALUE ESTIMATED BY THE VALUATION OFFICER AND THE SALE CONSIDERATION SHOWN BY THE ASSESSEE IS LESS THAN 10%. AN IDENTICAL SITUATION WAS CONSIDERED BY THE PUNE BENCH OF THIS TRIBUNAL IN RAHUL CONSTRUCTION (SUPRA). AFTER CONSIDERING THE VARIOUS CASE-LAWS THE PUNE BENCH OF THIS TRIBUNAL FOUND THAT THE DIFFERENCE OF 10% IN VALUATION IS ALWAYS BOUND TO OCCUR. THEREFORE, WHEN THE DIFFERENCE BETWEEN THE VALUE SHOWN BY THE ASSESSEE AND THE ESTIMATED VALUE IS LESS THAN 10%, THE VALUE SHOWN BY THE ASSESSEE SHALL BE ADOPTED FOR THE PURPOSE OF COMPUTATION OF CAPITAL GAIN. IN THIS CASE ALSO THE DIFFERENCE IS LESS THAN 10% BETWEEN THE VALUE SHOWN BY THE ASSESSEE AND THE VALUE ESTIMATED BY THE VALUATION OFFICER. WHEN THE VALUE OF THE PROPERTY WAS ESTIMATED THERE WILL BE A DIFFERENCE OF 10% DEPENDING UPON THE INDIVIDUAL VALUATION OFFICERS. NO ONE IS EXPECTED TO VALUE THE PROPERTY ACCURATELY SINCE SOME OF THE ITEMS ARE TO BE VALUED ON GUESSWORK OR NOTIONALLY. THEREFORE, AS OBSERVED BY THE PUNE BENCH OF THIS TRIBUNAL, THE DIFFERENCE OF LESS THAN 10% HAS TO BE IGNORED. IN VIEW OF THE DECISION OF THE PUNE BENCH OF THIS TRIBUNAL IN THE CASE OF RAHUL CONSTRUCTION (SUPRA), IN OUR OPINION, THE CIT(A) HAS RIGHTLY DELETED THE ADDITION MADE BY THE ASSESSING OFFICER. THEREFORE, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LOWER AUTHORITY. ACCORDINGLY THE SAME IS CONFIRMED. 7 I.T.A. NO. 992/KOL/2017 ASSESSMENT YEAR: 2013-14 SANKAR SARKAR 7. THIS BENCH OF THE TRIBUNAL IN ITO VS. M/S. LGW LIMITED KOLKATA IN ITA NO. 267/KOL/2013, ASSESSMENT YEAR 2009-10, ORDER DT. 07/10/2015, APPLIED THE DECISION OF THE HYDERABAD BENCH OF THE TRIBUNAL AND AT AT PARA 31 HELD AS FOLLOWS:- 31. WE HAVE CONSIDERED THE SUBMISSIONS MADE ON BEHALF OF THE LD. COUNSEL FOR THE ASSESSEE. THOUGH SECTION 50C OF THE ACT DOES NOT SPEAK OF ANY SUCH VARIATION IN TERMS OF PERCENTAGE BETWEEN VALUE ADOPTED FOR THE PURPOSE OF STAMP DUTY AND THE REGISTRATION AND THE ACTUAL CONSIDERATION RECEIVED ON TRANSFER, KEEPING IN VIEW OF THE DECISION OF THE HON'BLE ITAT, HYDERABAD BENCH REFERRED TO ABOVE AND KEEPING IN VIEW OF THE FACT THAT THE DIFFERENCE BETWEEN THE VALUATION FOR THE STAMP DUTY AND THE ACTUAL CONSIDERATION RECEIVED BY THE ASSESSEE IS LESS THAN 2% WE ARE OF THE VIEW THAT ADDITION SUSTAINED BY CIT(A) SHOULD BE DELETED. ACCORDINGLY GROUND NO.1 RAISED BY THE ASSESSEE IN CROSS OBJECTION IS ALLOWED. 7.1. THE LD. D/R HAS NOT BROUGHT TO OUR NOTICE ANY CONTRARY DECISION ON THIS ISSUE. THUS, RESPECTFULLY APPLYING THE DECISION OF THE CO-ORDINATE BENCH OF THE TRIBUNAL, THE DISALLOWANCE IS DELETED AS THE SAME IS LESS THAN 10% OF THE STAMP DUTY VALUE. THE REQUEST OF THE LD. D/R TO RESTORE THE MATTER TO THE FILE OF THE ASSESSING OFFICER WITH A DIRECTION TO REFER THE MATTER TO THE DVO BY APPLYING THE JUDGMENT OF THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF SUNIL KUMAR AGARWAL (SUPRA), CANNOT BE CONSIDERED IN VIEW OF OUR APPLYING THE PROPOSITIONS OF LAW LAID DOWN BY THE CO-ORDINATE BENCH OF THE TRIBUNAL CITED ABOVE. IN THE RESULT, GROUND NO. 2 OF THE ASSESSEE IS ALLOWED. 8. GROUND NO. 3 OF THE ASSESSEE IS AGAINST THE DIRECTION OF THE LD. CIT(A) TO THE ASSESSING OFFICER FOR VERIFYING WHETHER THE DISALLOWANCE U/S 40A(3) OF THE ACT HAS BEEN MADE OF AMOUNTS WHICH WERE IN THE REVENUE FIELD. THE ASSESSEES CASE IS THAT NO SUCH DISALLOWANCE CAN BE MADE AS THE EXPENDITURE WAS IN THE CAPITAL FIELD AND THE ASSESSEE HAS NOT CLAIMED A DEDUCTION OF THE SAME IN THE PROFIT AND LOSS ACCOUNT. HE FURTHER SUBMITS THAT THE LD. CIT(A) HAS NO POWER OF REMAND AND HENCE THE DIRECTIONS GIVEN TO THE ASSESSING OFFICER ARE BEYOND JURISDICTION AND HENCE BAD IN LAW. IN OUR VIEW, RESTORING THE MATTER TO THE FILE OF THE ASSESSING OFFICER FOR THE LIMITED PURPOSE OF VERIFICATION BY THE LD. CIT(A) IS PERMISSIBLE UNDER THE ACT. NEVERTHELESS, WE SET ASIDE THE ISSUE TO THE FILE OF THE ASSESSING OFFICER WITH A DIRECTION TO VERIFY WHETHER THE ASSESSEE HAD CLAIMED ANY DEDUCTION IN ITS PROFIT AND LOSS ACCOUNT OF THESE AMOUNTS, AND WHETHER A DISALLOWANCE U/S 40A(3) OF THE ACT HAVE BEEN MADE FROM SUCH CLAIM OF DEDUCTION BY THE ASSESSEE. IF THE ASSESSEE HAS NOT CLAIMED ANY DEDUCTION, AS REVENUE EXPENDITURE DURING THE YEAR, NO 8 I.T.A. NO. 992/KOL/2017 ASSESSMENT YEAR: 2013-14 SANKAR SARKAR DISALLOWANCE CAN BE MADE U/S 40A(3) OF THE ACT. THUS, THIS GROUND OF THE ASSESSEE IS ALLOWED IN PART. 9. GROUND NO. 4, IS GENERAL IN NATURE. 10. IN THE RESULT APPEAL OF THE ASSESSEE IS ALLOWED IN PART. KOLKATA, THE 14 TH DAY OF AUGUST, 2019. SD/- SD/- [ S.S. VISWANETHRA RAVI ] [ J. SUDHAKAR REDDY ] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 14.08.2019 {SC SPS} COPY OF THE ORDER FORWARDED TO: 1. SANKAR SARKAR NANDAN COLONY RAKHAL GHOSH ROAD RAJPUR KOLKATA 700 149 2. ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-26 KOLKATA 3. CIT(A)- 4. CIT- , 5. CIT(DR), KOLKATA BENCHES, KOLKATA. TRUE COPY BY ORDER ASSISTANT REGISTRAR ITAT, KOLKATA BENCHES