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Income Tax Appellate Tribunal, HYDERABAD BENCH “B”, HYDERABAD
Before: SMT. P. MADHAVI DEVI & SHRI A. MOHAN ALANKAMONY
IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH “B”, HYDERABAD (Through Virtual Hearing) BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ITA No.265/Hyd/2019 Assessment Year:2014-15 Jyothi Bhanoth, Vs. ACIT, Khammam. Circle-1, PAN: ANOPB 4718 R Khammam. (Appellant) (Respondent) Assessee by: Shri T. Chaitanya Kumar Revenue by: Shri Rohit Mujumdar, DR Date of hearing: 15/12/2020 Date of pronouncement: 21/01/2021 ORDER PER A. MOHAN ALANKAMONY, AM.:
This appeal is filed by the assessee against the order of the Ld. CIT(A)-7, Hyderabad in appeal No. 0299/CIT(A)-7/2017-18, dated 18/02/2019 passed U/s. 143(3) r.w.s 250(6) of the Act for the AY: 2014- 15.
The assessee has raised nine grounds in her appeal however, the crux of the issue is that the Ld. CIT (A) has erred in upholding the order of the Ld. AO who had invoked the provisions of section 56(2)(vii)(b) of the Act and brought to tax the stamp duty value of the property purchased which exceeded the actual purchase consideration.
The brief facts of the case is that the assessee is an individual earning income from house property, income from other sources and capital gains, filed her return of income for the AY 2014-15 on 3/2/2015 admitting total income of Rs. 6,91,130/-. Initially, the return of income was processed U/s. 143(1) of the Act and thereafter the case was selected for scrutiny for verification of financial transactions as the assessee had purchased immovable property vide Doc. No. 7003 dated 14/11/2013. Subsequently, the assessment was completed U/s. 143(3) of the Act vide order dated 28/7/2016 wherein the Ld. AO invoked the provisions of section 56(2)(vii)(b) of the Act and brought to tax the stamp duty value of the property purchased which exceeded the actual purchase consideration. On appeal, the Ld. CIT (A) confirmed the order of the Ld. AO, aggrieved by which the assessee is in appeal before us.
During the course of assessment proceedings, it was revealed from the data received from the Stamp Valuation Authority that during the FY 2013-14 the assessee had purchased two properties vide Doc. No. 7002 and 7001 in addition to the immovable property acquired vide Doc. No. 7003. All the three properties purchased were in Edulapuram Village S. No. 177/C, H.No. 5-94, 5-95 and the aggregate sale consideration paid for all the three immovable properties was Rs. 1,61,00,000/- as per the registered sale deed while as the aggregate value as per the Stamp Valuation Authority was Rs. 4,39,23,056/-. On query as to why the provisions of section 56(2)(vii)(b) of the Act would
not be attracted, the assessee had replied vide her letter dated 12/2/2016 as under:-
“I have purchased asset in the financial year 2013-14 assessment year 2014-15 under three registered documents. Actually, I have purchased the above property for an amount of Rs. 1,61,00,000/- on date 01/04/2011 on agreement, and I have given as a advance of Rs. 20 lakhs cash to Mittapally Santharam & his family members (seller of the asset). They have sold property to clear the HDFC Bank loan. Long back Mittapally Santharam was done Parboiled Rice Mill Business. For business capital he taken loan from HDFC Bank and he was failed to pay that loan amount. The bank officials attached that property and ready for auction. Mittapally Santharam alert and decided to sale that property immediately. After that I have purchased that property and paid cash of Rs. 20 lakhs as advance to Mittapally Santharam paid HDFC Bank loan instalment to avoid from bank auction. After I have paid Rs. 25 lakhs and Rs. 30 lakhs in the financial year 2011-12 and Rs. 15 lakhs in the year 2012-13 and remaining of Rs. 71 lakhs in the year 2013-14 and registered that property in the year 2013-14. At the time of purchase (agreement) the site registration value in the area Rs. 800/- per sq. yard only. But the government raised that value in the Financial Year 2013-14 from Rs. 800/- to 3,000/- at a time (proof also enclosed herewith). So, there is no way for me. And I have registered that property as per Rs. 3,000/- per yard. As per the above facts the section 56(2)(vii)(b) will not be applicable in my case. So kindly consider the above facts and not raise tax in my scrutiny assessment. I am herewith enclosing the copy of agreement of the assets purchased.”
However, the ld. AO opined that the provisions of section 56(2)(vii)(b) would be applicable in the case of the assessee and brought to tax an amount of Rs. 2,78,23,056/- being the value of the property as per the Stamp Valuation Authority which exceeded the actual purchase consideration declared in the sale deed viz., (Rs. 4,39,23,056 – Rs. 1,61,00,000). On appeal, the assessee reiterated the submission made before the Ld. AO. However, the Ld. CIT (A) confirmed the order of the Ld. AO by observing as follows:-
“5.2…….
The section 56(2)(vii)(b) provides for adopting the stamp duty value fixed by the Government as deemed consideration and the difference is assessable as income from other sources. There is no scope for adopting the values assessable by Stamp Value Authority as on the date of agreement as amount was paid in cash as on the date of agreement, the agreement of sale was not registered, the agreement of sale was not part of the registered sale deed. Therefore, I reject the contentions raised by the appellant and confirm the addition made by the Assessing Officer……” 6. Before us, the Ld. AR made the following submissions:
(i) The vendor of the property Shri Mittapally Shanta Ram and his family members had obtained loan from HDFC Bank for their business purposes and since they could not repay the loan the bank attached the relevant property and brought it to auction vide Newspaper advertisement in the year 2011 (paper advertisement with English translation at page-8, 8.1 & 8.2 of the paper book). (ii) As on the date of Newspaper advertisement, the outstanding bank loan along with interest stood at Rs. 1,61,00,000/-. (iii) The value of the property as per the Stamp Valuation Authority as on that date was only Rs. 800/- per sq yd, accordingly the value of the property as per the Stamp Valuation Authority for the entire property was less than Rs. 1,61,00,000/-. (iv) Since the vendors were from a respected and prominent family of the locality having good relationship with the assessee, the assessee agreed to purchase the property at Rs. 1,61,00,000/- in the year 2011 to bail them out from the bank loan.
(v) Thereafter, sale agreement was executed on 1/4/2011 between the assessee and the vendors wherein the assessee directly remitted cash of Rs. 20 lakhs in the HDFC Bank account of the Vendors. (vi) Subsequently, the balance amount of Rs. 1,41,00,000/- was also deposited in the HDFC Bank account of the Vendors during the year 2011 itself and the bank issued a no-objection Certificate (Page-5 of Paper Book) on 01/08/2013 stating that all the dues outstanding in the Vendor’s account were settled. (vii) Therefore, the sale agreement was entered during the year 2011 and the entire sale consideration was remitted in the bank account of the assessee directly. Hence while invoking the provisions of Section 56(2)(vii)(b) of the Act the stamp duty value of the property during the year 2011 should be taken into consideration and since such value is less than the actual sale consideration provisions of Section 56(2)(vii)(b) of the Act cannot be invoked. (viii) When the sale transaction was known to all the other creditors of the vendor they agitated and caused harassment to the vendor and to the assessee. The Vendor’s family was dislocated and therefore the sale deed could not be executed in the year 2011 itself though the entire sale consideration was paid. (ix) After facing several hardships and persuading the Vendors the assessee was able to assemble the vendors during the relevant
Financial Year and finally the sale deed was executed on 14/11/2013. By that time the Stamp Valuation Authority had revised the value of the property from Rs.800 per sq yd to Rs. 3000 sq yd. (x) The Government Notified to revise the value of the property from Rs.800 per sq yd to Rs.3000 per sq yd vide order dated 30/03/2013 (Page-66 of the Paper Book). (xi) This order of the Government was challenged before the Hon’ble High Court of Andhra Pradesh vide Public Litigation No. 274 of 2013 wherein the Hon’ble AP High Court in its order observed that the order of the Hon’ble AP Government for revising the value of the property vide Order dated 30/03/2013 is erroneous. Therefore, the value of the property as per the Stamp Valuation Authority even for the relevant AY 2014-15 is only Rs. 800/- per sq. yd and hence provisions of section 56(2)(vii)(b) of the Act will not be attracted. (xii) In the case of the Vendors, though the Revenue proceeded to invoke Section 50C of the Act, they finally arrived at the value of the property only at Rs. 2,03,65,854/-. (xiii) The Ld. AO had arrived at the value of the property at Rs. 2,03,65,854/-following the directions of Additional CIT U/s. 144A of the Act vide his order dated 29/12/2018. The value of the property was so arrived by the Revenue considering the facts and circumstances of the case of the assessee and keeping
in view of its inherent disadvantages of the property. Therefore, even if section 56(2)(vii)(b) of the Act is invoked, the sale consideration cannot be adopted more than Rs. 2,03,65,854/- .
With the above submissions, the Ld. AR pleaded that since the agreement for the purchase of the property was executed in the AY: 2011-12 and the entire sale consideration was directly remitted into the bank account of the Vendors, the value of the property as per the Stamp Valuation Authority prevailing at that time has to be taken into consideration and since such value is less than Rs. 1,61,00,000/- provisions of section 56(2)(vii)(b) of the Act cannot be invoked. The Ld. AR further pleaded that if the Ld. Revenue Authorities are of the view that the assessee had made payment towards the sale consideration, by way of cash then also provisions of section 56(2)(vii)(b) cannot be invoked because the Government order for increasing the valuation from Rs. 800/- per sq yd to Rs. 3000/- per sq. yd was quashed by the Hon’ble High Court of Andhra Pradesh vide its Order in the Public Interest Litigation No. 274 of 2013 dated 23rd September, 2013. The Ld. AR once again submitted that even otherwise, the value of the property as per the Stamp Valuation Authority cannot be adopted more than Rs. 2,03,65,854/- because in the proceedings with respect to the vendors, the Ld. Revenue Authorities after due consideration had adopted the value at Rs. 2,03,65,854/- while invoking the provisions of section 50C
of the Act in their case. The Ld. DR on the other hand vehemently argued in support of the orders of the Ld. Revenue Authorities and requested for confirming the same.
We have heard the rival submissions and carefully perused the materials on record. The contention of the assessee that she has paid the sale consideration during the AY 2011-12 in a mode other than cash is not acceptable because the assessee has paid only by cash for the purchase of the property even if it was remitted in the bank account of the Vendors directly. However, the arguments of the assessee that, (1) The Hon’ble High Court of Andhra Pradesh has quashed the order of the Government for enhancing the valuation of the property and (2) The Ld. Revenue Authorities in the case of the Vendors of the assessee while invoking the provisions of section 50C of the Act has valued the property at Rs. 2,03,65,854/-, is required to be considered while deciding the case of the assessee. The order of the Hon’ble High Court in the Public Interest Litigation No. 274 of 2013 dated 23/09/2013 is reproduced herein below for reference:-
“The Court made the following:
ORDER: (Per the Hon’ble Chief Justice Sri K. J. Sengupta)
This Public Interest Litigation has been taken out to challenge Government order No. 157 dated 30/3/2013 by which the Government has empowered the Commissioner and inspector General of Registration and Stamps to implement the revised market values in urban areas, Secunderabad Cantonment area and rural areas in the State with effect from 1/4/2013.
It is the contention of the petitioners that this order has been passed without having any power of relaxation of rules.
We have checked up the relevant Rules namely Andhra Pradesh Revisions of Market Value Guidelines Rules, 1998, which is mentioned in the impugned order. Surprisingly, we found that there is no power to relax the Rules. If no power is conferred under the Rules, how the Government can relax the said Rules. Therefore, it is an arbitrary decision, if not totally non-application of mind. On that ground alone, the Writ Petition succeeds and the impugned order dated 30/03/2013 is set aside. However, liberty is given to proceed strictly in accordance with law. The Public Interest Litigation is allowed accordingly. No Costs.”
From the above, it appears that the order of the Government for enhancing the valuation of the property for determining the Stamp Duty while registering the sale deed, goes in favour of the assessee. If the Order of the Hon’ble High Court has held that the Order of the Government enhancing of the valuation of property for determining the Stamp Duty while registering the sale deed is erroneous then the value of the property for determining the stamp duty in the case of the assessee will remain at Rs. 800/- per sq. yd. In such circumstances, it will be erroneous on the part of the Revenue to invoke the provisions of section 56(2)(vii)(b) of the Act in the case of the assessee.
Therefore, in the interest of justice, we hereby remit back the matter to the file of the Ld. AO to verify whether by virtue of the order of the Hon’ble High Court, the enhancement of the valuation of the property for the purpose of registering the sale deed has been struck down by the Hon’ble High Court and if so, assess the income
of the assessee without invoking the provisions of section 56(2)(vii)(b) of the Act. If found otherwise the Ld.AO shall proceed to assess the income of the assessee U/s. 56(2)(vii)(b) of the Act in the following manner.
In case, the order of the Government enhancing the valuation of the property is in vogue then, the finding of the Revenue in the case of the Vendor would be relevant. During the assessment proceedings of the vendor viz., Sri Mittapalli Naveen, Khammam the Ld. AO, Ward-1, Khammam for the AY 2014-15 in his order dated 29/12/2018 has extracted the report of the IT Inspector who was assigned to find the facts of the case. The relevant portion is reproduced herein below for reference: -
“7. As directed by the Income Tax Officer, Ward-1, Khammam, I have visited D. No. 2-3-309, Near Sunder Talkies, Khammam on 26/09/2018 regarding the sale consideration and complete details of the assessee. As told by Sri Mittapalli Santharam, he was the owner of a rice mill, which was situated at a Lambada area, Seventy (70) members used to work under him. As he was the only owner and there were no partners, he did not recognize the mischief done by his servants. Drought for two years further worsened the business. As the business went into loss, he was unable to repay the loans. The land where the rice mill was located was in the middle of a Lambada Area. As told by him, the Lambada people did not provide road for his mill which led to further arguments between him and the Lambada People. In view of all those arguments, loss in the business and notices, pressure from bank officers regarding repayment of loans, Sri Mittapalli Santharam decided to sell the land. As no one shown interest in buying the land, he sold the site to Smt. Bhanu Jyothi for Rs. 1.60 Crores which was paid in cash in several instalments. He said that he used that money for repaying the bank loans. At present he is living along with his wife and younger son, Sri Mittapalli Naveen, who works in an insurance company. Sri Mittapalli Naveen got divorced, underwent a survey (relating to heart). The Elder son, Sri Murali Krishna, who underwent a hip joint surgery, is living in Hyderabad, the other son, Sri Ramesh absconded after filing an insolvency petition.”
Thereafter, the Ld. AO observed in his Order in the case of the vendor Sri Mittapalli Naveen as under: -
“8. Under the above circumstances, there appears to be a reason that the consideration amount could have been only Rs. 1.61 Crores for the following reasons:- (a) Neither Sri Shantaram or Smt. Vijayalakshmi or any one of their children appear to be in a flourishing stage having received such excess amounts. (b) The business closed long back and no returns are being filed. (c) Present situation of the old people is very pathetic (As per ITI’s report). (d) The debtors and Court cases are still around them like a cob web. (e) No assets were left except their living house which is under court litigation. (f) Even as per the 1st Proviso to section 56(2)(vii)(b)(ii) – If the date of agreement and the date of registration are different, then the date of agreement is to be considered for the purpose of Market value. 9. Though the 1st Proviso to Section 56(2)(vii)(b)(ii) specifies that if the date of agreement and date of registration are different, then the date of agreement is to be considered for the purpose of Market value. But he 2nd Proviso to sect5ion 56(2)(vii)(b) stipulates a condition that the above said 1st Proviso shall apply only in a case where the amount of consideration referred to therein, or a part thereof, has been paid by any mode other than cash on or before the date of agreement for the transfer of such immovable property. 9.1. In the instant case, though the agreement was made on 01/04/2011, the sale deed was executed on 14/11/2013. The assessee could not produce any proof that any part payment of the entire consideration was paid by way of Cheque / DD / RTGS etc. Therefore, in the absence of such proof, the assessee / AR was asked as to why the provisions of section 50C should not be applied w.r.t Section 56(2)(vii)(b)(ii). The Ld. AR argued that though the entire transaction was made in cash, the instalment payments made by the purchaser was immediately deposited in the HDFC bank against the loan account. The assessee made a claim that the payments to the bank may be considered as “transaction other than cash”. The plea of the assessee/A.R is not acceptable as the HDFC bank is a third party which is meant for only releasing the property under its possession consequent to loan repayment. Therefore, it was proposed to apply provisions of section 50C to this case and the total consideration is deemed to be the Market Value of the property which is at Rs. 4,39,23,056/-. But the assessee/AR argued that the market value of the property as on the date of agreement is much lower than the value as on the date of registration and he has not received such consideration as specified by the market value. In certain cases, this causes a very difficult situation for the seller of the property as he is required to pay tax on extra money which he never received. Alternatively, if he wants to claim any exemption by investing in a residential house or capital gains bonds, etc., depending upon the facts
of his case, he has to invest an extra amount, which he never received on sale. To come out of the difficulty one may consider recourse to relief provisions, but by the time decision in respect of relief provisions come, the assessee would have devoid of getting benefit out of it, as he would have paid the taxes. Stamp duty is generally paid by the purchaser of the property. Therefore, the purchaser is entitled to dispute higher valuation by stamp duty authorities. However, generally the purchasers do not prefer an appeal before the stamp duty authorities as compared to the purchase price involved, the amount of additional stamp duty becoming payable due to higher valuation by stamp duty authority is meagre amount which does not afford spending money and time involved in the appeal. 11. Under these circumstances, to avoid a high-pitched addition and in view of the existing ambiguity, instructions U/s. 144A of the Act were sought for from the Addl. CIT, Khammam Range vide this office letter dated 28/09/2018, for completion of the assessment. 11.1…….. 11.2……. 12. The Addl. CIT, Khammam Range vide his letter in F.No.144A/ Addl. CIT/Kmm/2018-19, dated 05/11/2018 directed to examine the contention of the assessee in the valuation of the cost of land fixed by the Registration Department by obtaining the valuation report from a Department Approved Valuer and ascertain the true value of the immovable property. Accordingly, as directed by the Addl. CIT, the Valuation Report as submitted by the assessee which was obtained from the Registered Valuer for Income Tax Department” one Mr. V. Sreedhar, Vide his registration No. C-1/33/CCIT-III/XX/Reg. Val/56/03-04 is submitted before the Addl. CIT. As per the Valuation Report the land value was determined @ 1000/- per sq. yd as against the Stamp Duty value. However, the valuer did not determine any value for the structure. The Addl. CIT, Khammam Range vide his letter in F.No.144A/Addl. CIT/Kmm/2018-19, dated 06-12-2018 directed as under: “The valuation report submitted has been perused. In view of the above, you are directed to verify the contents of the report and adopt the valuation determined by the registered valuer based on facts and adhering to the provisions of the Income Tax Act, 1961.” 12.1. The report of the “Registered Valuer for Income Tax Department” one Mr. V. Sreedhar, Chartered Engineer (India) Membership No. M/121750/4 vide his registration No.C-1/33/CCIT-III/XX/Reg. Val/56/03-04 narrated that the land is situated at the outskirts of Khammam at about 7 Km to 8 Km and is in the vicinity of Tribal community who are manufacturing illicit liquor / arrack and certain Meat and Chiken shops also exist. Therefore, no person would be willing to take such land as the land is equipped with wastage materials and is used as dumping yard by the localities. Hence land does not yield much value as compared to other Urban Lands at Khammam and rate fixed by the Stamp Duty Authority would not applicable to this land. The detailed report of the Regd. Valuer is reproduced as under:
“V. Sreedhar, Chartered Engineer (India) No. M/121750/4, Registered Wealth Tax and Income Tax Valuer, No. C-1; 33/CCIT-III/XX/Reg. Val/56/03-04, Approved by CHIEF Commissioner of Income Tax, Hyderabad, A.P. (Value has a value only if it is valued) Valuation report on fair market value of property bearing survey No. 177/1, Edulapalem, Pedda Thanda, Khammam Rural Mandal & District jointly belonging to 1) Mittapalli Vijayalakshmi 2) Mittapalli Muralikrishna 3) Mittapalli Ramesh 4) Mittapalli Naveen. Under instructions from owners, the property was inspected to assess fair market value as on date. The relevant particulars were collected at site and details of valuation are summarised as under:- History: Total vacant land having an extent of 11,129.60 sq. yds was purchased on different years under registered sale deed document Nos. 144/1980; 4711/1982; 513/1992; 514/1992 and 515/1992. Subsequently after purchase, they constructed sheds and RCC roof block. All four owners want to sell entire property and entered an agreement on 1/4/2011, but same property was registered on 14/11/2013. Location of property: - The subject property had been located outskirts about 7 km to 8 km away from Khammam town. In the vicinity Total community are living since long period. Their occupation is manufacturing their liquor / arrack shops and same is supplying various places. Meat and chiken shops also exist in addition to this, there is a huge dumping yard where all wastage materials are being dumped surrounding of this property. This will get health effect. Open prevailing market Rate: Due to the above reasons as per local enquiries made no other communities from external area will come forward to purchase the site in this locality. As per local people opinions, the land rate varies from Rs. 200/- sq yard to Rs. 1300/- sq yard. By viewing all points into consideration, conservative rate of Rs. 1000/- per sq yard is found reasonable and same is adopted in the valuation. SRO Rates. The sub registrar rates are increased keeping in view getting revenue to government by registering properties. The SR values are also calculated entire area compromising the all properties facing internal roads and also main road (well developed and undeveloped areas in vicinity). The stamp duty value will not be applicable to this property as mentioned above. LAND VALUE: 11,128 sq. yards @ Rs. 1000/- sq. yard Rs. 1,11,28,600.00 (or say Rupees ( one crore eleven lakhs twenty eight thousands and six hundred only) Sd/xxx V. Sreedhar
Since the case on hand is not appeared to be a case of section 50C, I do not find any uncertainty in the contention of the assessee that the stamp duty was only paid in excess as per the Land Registration Act and the actual consideration was paid as per the agreement dated 1/4/2011. Hence, there is no necessity to ascertain the Fair Market Value of the capital asset afresh by referring the same to Valuation Officer U/s. 55A of the Act. Therefore, following the directions of the Addl. CIT U/s. 144a and keeping in view of the provisions of Income Tax, the Land value as determined by the “Registered Valuer for Income Tax Department Mr. V. Sreedhar, vide his registration No.C-1/22/CCIT-III/XX/Reg. Val/56/03- 04, the land value is adopted at Rs. 1000/- per sq yd and since the Valuation Report was silent about the construction cost, the web site is browsed, and it is ascertained that the rates varied from Rs. 380 to Rs. 622 between the period 2010 to 2014. Though the construction was made way back in 1930 and the structures are dilapidated ones, and the actual cost of construction has no value as on the date of transfer, yet the value of RCC is taken at Rs. 630/- per s.ft. and the value of sheds are taken at Rs. 480 per s.ft s determined by the stamp duty authority. Therefore, the probable sale consideration as directed U/s. 144A and as determined by the Registered Valuer is worked out as under:- Document Land Rate Built-up Area Rate/ Total value Nos. extent / sq. (sq. fts) sq. ft Dt: (sq. yds) yd 14/11/2013 7001/2013 3848.00 1000 0 0 38,48,000 7002/2013 1366.00 1000 RCC-935.49 630 (1366000+589 359+1344283) Shed-2800.59 480 3736.08 2,99,642 7003/2013 5914.60 1000 RCC-1365 630 (5914600 + 8599950 + 7743662) Shed – 16132.63 17497.63 480
1,35,18,212 Total 11128.6 21233.71 2,03,65,854
13.1. Hence, the sale consideration is determined at Rs. 2,03,65,854/- as against the consideration of Rs. 1,61,00,000/-……”
Accordingly, in the case of the Vendor the Ld. AO invoking the provisions of Section 50C of the Act computed the long-term capital gain
at Rs. 11,26,261/- adopting the market value of the property as Rs. 2,03,65,854/- with respect to the sale of his property to the assessee for Rs. 1,61,00,000/-
It is pertinent to mention that section 50C of the Act is a special provision introduced by the Finance Act, 2002 to deal with the unaccounted income by way of understatement of the actual sale consideration by the seller of the immovable property. In such transactions, the excess sale consideration other than what is mentioned in the sale deed are received by cash by the seller of the immovable property thereby escaping tax and generating black money. Thereafter in the Finance Act 2013, w.e.f 01-04-2014 section 56(2)(vii)(b) was introduced to discourage and wean out such transactions by the purchaser of the property as well. However, considering the facts of the case before us, it appears that no such on- money transactions are involved in the purchase of the property. The arguments advanced by the Ld.AR recorded in para 6(viii) & 6(ix) hereinabove is also not disputed by the Revenue, but rather accepted by the Revenue after due verification in the case of the vendor Sri Mittapalli Naveen. The Revenue having considered these facts, in the case of the seller of the property, had adopted the sale consideration at Rs. 2,03,65,854/- as against the stamp duty value of the property of Rs. 4,39,23,056/- while invoking the provisions of Section 50C of the Act in the assessment Order dated 29/12/2018. Therefore, it is obvious
that a contrary view by the Ld.AO to adopt the stamp duty value of the property at Rs. 4,39,23,056/- in the case of the buyer (the assessee) of the property while invoking the provisions of Section 56(2)(vii)(b) of the Act is not appropriate because the Ld.AO had missed out to examine the entire facts of the case.
Therefore, we hereby direct the Ld.AO that, if by virtue of the Order of the Government the value of the property for the purpose of registering the sale deed has been enhanced and has not been interfered by any Judicial/Executive Authority during the relevant period, then adopt the stamp duty value of the property purchased by the assessee at Rs. 2,03,65,854/- for the purpose of assessing the income of the assessee invoking the provisions of section 56(2)(vii)(b) of the Act.
16 Accordingly the Ld.AO is directed to pass appropriate Order as per our directions mentioned in para 10 or para 15 of this Order whichever is applicable after providing the assessee with due opportunity of being heard.
In the result, appeal of the assessee is partly allowed for statistical purposes as indicated herein above.
Pronounced in the open Court on the 21st January, 2021.
Sd/- Sd/- (P. MADHAVI DEVI) (A. MOHAN ALANKAMONY) JUDICIAL MEMBER ACCOUNTANT MEMBER Hyderabad, Dated: 21st January, 2021.
OKK
Copy to:- 1. Jyothi Bhanoth C/o. T. Chaitanya Kumar, Advocate, Flat No.102, Gowri Apts, URDU Lane, Himayathnagar, Hyderabad. 2. Assistant Commissioner of Income Tax, Circle-1, Khammam, Telangana. 3. The CIT (A)-7, Hyderabad. 4. The Principal Commissioner of Income Tax-7, Hyderabad. 5. The Departmental Representative, ITAT, Hyderabad. 6. Guard File.