ITO, Ward- 20(3) , New Delhi V. RMG Buildwell (P) Ltd., New Delhi

MA 232/DEL/2021

• Counselvise Citation: [2024] 101 COUNSELVISE.COM (IT) 5159 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 7 month(s) 16 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 08-08-2024
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2014-2015
• Appeal Filed On: 22-12-2021
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: N. C. AGARWAL
• Keywords: Sale consideration of property below Jantri Value; Retrospective amendment
• Section: 254(2)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘SMC’, NEW DELHI BEFORE SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER MA No.232/Del/2021 (Arising out of ITA No.1311/Del/2018) (Assessment Year : 2014-15) ITO Ward-20(3), New Delhi PAN No. AAECR 0311 C Vs. RMG Buildwell (P.) Ltd. G-1354, Lower Ground Floor, C. R. Park, New Delhi – 110 019 (APPELLANT) (RESPONDENT) Assessee by Shri N. C. Agarwal, C.A. Revenue by Ms. Kirti Sankratyayan, Sr. D.R. Date of hearing: 09.08.2024 Date of Pronouncement: 09.08.2024 ORDER PER PRADIP KUMAR KEDIA, AM : The Revenue has moved Misc. Application in section 254(2) of the Act dated 23.12.2021 arising from the order passed by the Tribunal dated 27.07.2021 under section 254(1) of the Act. 2. As per the Misc. Application, the Revenue has sought rectification of the mistake committed by the Tribunal in applying the judgment rendered in the case of John Flower (India) Pvt. Ltd. vs. DCIT ITA No.7545/Mum/2014 order dated 25.01.2017. 3. Briefly stated, the assessee company entered into a collaboration agreement with M/s. Techmen Buildwell Pvt. Ltd. for construction of flats. As per the said agreement, the assessee company shared 35% of the total revenue from sale of flats. It MA No.232/Del/2021 (arising out of ITA No.1311/Del/2018) ITO vs. RMG Buildwell (P.) Ltd. A.Y. 2014-15 -2- was found in the course of assessment that a flat of Rs.55,16,000/- was sold by M/s. Techmen Builwell Pvt. Ltd. as against the circle rate of Rs.59,78,115/-. The assessee accounted for its income of Rs.19,30,600/- being 35% share of Rs.55,16,000/-. The Assessing Officer invoked the provision of section 50C/43CA and adopted full value of consideration at circle rate. The AO accordingly brought to tax an amount of Rs.1,61,740/- being 35% of the difference in the declared value of consideration vis-a- vis circle rate. The Tribunal referred to the decision rendered in the case of John Flower (supra) and reversed the additions under section 50C/43CA of the Act in the hands of assessee on the ground that difference between circle rate and the sale consideration received by the assessee is less than 10% and therefore, the provision of section 50C/43CA of the Act would not apply. 4. The Revenue challenged the aforesaid order of the Tribunal passed under section 254(1) by invoking section 254(2) of the Act. 5. As per the Misc. Application, the contention of the Revenue is as under: “Thereafter, assessee filed appeal before ITAT The Hon'ble ITAT relying on the decision of the Mumbai Bench of the Tribunal in the case M/s John flower India Pvt. Ltd. vs. DCIT vide ITA no. 7545/Mum/2014 dated 25.01.2017, has allowed the appeal of the assessee on the ground that difference between Circle rate and the sale consideration received by the assessee being less than 10%, no addition can be made. The point of error is that the Mumbai Tribunal has given its decision on the basis of amendment in Finance (no. 02) Act, 2019 in section 43CA/50C, where no additions is required if the difference between the valuation adopted by the stamp duty Valuation Authority and the value declared by the assessee (actual sale consideration received) is less than 10%. But this amendment is effective from 01.04.2020. But in the instant case, the order was passed by A.O on 15.07.2016 and therefore, the amendment in Finance Act, 2019 is not applicable as it is neither clarificatory in nature nor it is effective with retrospective effect.” MA No.232/Del/2021 (arising out of ITA No.1311/Del/2018) ITO vs. RMG Buildwell (P.) Ltd. A.Y. 2014-15 -3- 6. I straightaway observe that the purported error pointed out on behalf of the Revenue cannot be bracketed in the league of ‘mistake apparent from record’ as contemplated under section 254(2) of the Act. The purported error pointed out may, at best, be regarded as error of judgment which cannot be equated with ‘mistake apparent from the record’. The Tribunal cannot review its order in the garb of section 254(2) of the Act which is very limited in its sweep. 7. This being so, the Misc. Application cannot be entertained. 8. In the result, Misc. Application of the Revenue is dismissed. Order was pronounced in the open court on 09.08.2024 Sd/- (PRADIP KUMAR KEDIA) ACCOUNTANT MEMBER Date:- 09.08.2024 Priti Yadav, Sr. PS* Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI