JYOTI EMBROIDERY PRIVATE LIMITED ,MUMBAI V. INCOME TAX OFFICER WARD 10(2)(1), MUMBAI

ITA 5637/MUM/2025

AI Insights

The case involves Jyoti Embroidery Private Limited, which appealed against the order of the National Faceless Appeal Center (Commissioner of Income Tax Appeals) concerning the assessment year 2013-14. The primary issue was the addition of Rs. 1,72,39,000 to the assessee's income, which was the differential between the stamp duty valuation of a property sold and the declared sale consideration. The Tribunal considered the preliminary and final valuation reports from the District Valuation Officer, which estimated the property's fair market value at Rs. 2,17,78,000, slightly above the sale consideration of Rs. 2,15,00,000. The Tribunal noted that this differential was within the statutory tolerance limit and directed the Assessing Officer to verify the DVO's reports and delete the addition if found genuine.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 822733 (ITAT-MUMBAI)
• Duration Of Justice: 3 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-12-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Assessment Year: 2013-2014
• Appeal Filed On: 11-09-2025
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KAVITHA KAUSHIK; LD.
• Assessee Lawyers: DHARAN GANDHI; LD
• Keywords: Sale consideration of property below Jantri Value; Fair market value; Valuation report; Value adopted by valuation officer
• Section: 147

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH “F”, MUMBAI BEFORE SHRI NARENDER KUMAR CHOUDHRY, JUDICIAL MEMBER And SHRI PRABHASH SHANKAR, ACCOUNTANT MEMBER ITA No.5637/M/2025 Assessment Year: 2013-14 Jyoti Embroidery Private Limited, V1-0 Vara’s House, 1st Ganeshwadi, Ground Floor, Near MJ Market, Zaveri Bazar, Mumbai – 400002 PAN – AAACJ 0872 G Vs. Income Tax Officer, Ward 10 (2)(1), Aaykar Bhavan, M.K. Road, Mumbai – 400020. (Appellant) (Respondent) Present for: Assessee by : Shri Dharan Gandhi, Ld. AR Revenue by : Ms. Kavitha Kaushik, Ld. SR. DR Date of Hearing : 04.11.2025 Date of Pronouncement : 24.12.2025 O R D E R Per : Narender Kumar Choudhry, Judicial Member: This appeal has been preferred by the Assessee against the order dated 28.07.2025 impugned herein passed by the National Faceless Appeal Center (Ld. Commissioner of Income Tax (Appeals) (for short Ld. Commissioner) under Section 250 of the Income Tax Act, 1961 (for short the ‘Act’) for the AY 2013-14. 2. In the instant case, the assessee has sold a land to M/s. Yogeshwar Farms Private Limited for a sale consideration of Rs. 2,15,00,000/- and claimed the long term capital gain of Rs. 1,58,00,000/- in the return of income filed on dated 28th September, 2013, declaring total income of Rs. 1,57,50,330/-. The AO considered the said claim of the assessee and ultimately found that the stamp duty value of the property is of Printed from counselvise.com ITA No.5637/M/2025 Jyoti Embroidery Private Limited 2 Rs.387,39,000/- and the assessee has sold the property for Rs.2,15,00,000/- i.e. less than the value adopted or assessed by the Valuation Authorities of the State Government and therefore he vide assessment order dated 25.09.2017 under Section 143 (3) read with under Section 147 of the Act, ultimately made the addition of Rs. 1,72,39,000/- being differential amount between the stamp duty valuation and the value declared by the assessee. 3. The assessee being aggrieved challenged the said addition by filing first appeal before the Ld. Commissioner and claimed that on the request of the assessee, the Ld. CIT (A) -17, Mumbai has asked to AO to refer the valuation and submit the report of the DVO, however, the Ld. Commissioner contradicted the said claim of the assessee and asked the assessee to provide the copy of the DVO, on the reason that how the assessee came to know about the report of the DVO called from the AO. 4. The assessee before the Ld. Commissioner neither filed any information nor provided any DVO report. Therefore, the Ld. Commissioner also issued multiple letters to the AO and the concerned Ld. PCIT to provide the report of the DVO, if any, in the case of the assessee, however, neither the status report nor the report itself was provided to the Ld. Commissioner. Therefore, considering the peculiar facts and circumstances in totality, the ld. Commissioner affirmed the aforesaid addition by dismissing the appeal of the assessee. 5. Thus, the assessee being aggrieved has preferred the instant appeal. The ld. Counsel at the outset by drawing attention of this Court to the Page nos. 73-84 of paper book has demonstrated that the District Valuation Officer – 1, I.T. Department, Mumbai– 12 has initially issued preliminary Printed from counselvise.com ITA No.5637/M/2025 Jyoti Embroidery Private Limited 3 valuation report dated 22.11.2019 under Section 55(A) and 50 (C) of the Act, along with annexures 1 and 2, on the basis of valuation and sale instances, estimating the fair market value of the property under consideration to the tune of Rs. 2,17,78,000/- and thereafter vide final valuation report dated 22-11-2019, reiterated the value of the property to the tune of Rs. 2,17,78,000/-. 6. We have given thoughtful consideration to the peculiar facts and circumstances and documents available on record including valuation reports and the submissions of the Assessee, which are not refuted by the Ld. DR. The aforesaid reports are not in denial by the Ld. D.R. however, the same are contrary to the findings of the authorities below, as the Ld. Commissioner has specifically mentioned in the order that no such direction was given for referring to the valuation of the property to the DVO. 6.1 Whatsoever, it may be, the assessee has filed DVO’s preliminary and final valuation reports, wherefrom it clearly appears that the District Valuation Officer -1, Mumbai has valued the property under consideration to the tune of Rs.2,17,78,000/- and it is an admitted fact that the assessee sold the property under consideration on a consideration of Rs. 2,15,00,000/- and the differential amount between the DVO report and the consideration amount shown by the assessee is of Rs. 2,78,000/- only, which is admittedly within the tolerance limit/leverage granted by the Statute and thus, the addition made by the AO and affirmed by the Ld. Commissioner, is liable to be deleted, however, subject to verification of the DVO’s reports by the AO and thus, we direct the Jurisdictional Assessing Officer {JAO} to verify the DVO’S reports and on being finding the same as genuine, delete the addition under consideration. Printed from counselvise.com ITA No.5637/M/2025 Jyoti Embroidery Private Limited 4 7. In the result, assessee’s appeal is allowed. Order pronounced in the open court on 24.12.2025. Sd/- Sd/- (SHRI PRABHASH SHANKAR) (NARENDER KUMAR CHOUDHRY) ACCOUNTANT MEMBER JUDICIAL MEMBER Tarun Kushwaha Sr. Private Secretary Copy to: The Appellant The Respondent The CIT, Concerned, Mumbai The DR Concerned Bench //True Copy// By Order Dy./Asstt. Registrar, ITAT, Mumbai. Printed from counselvise.com "