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Facts
The assessee appealed an order confirming an addition made under Section 56(2)(x) of the Income Tax Act, 1961, for AY 2018-19. The addition was based on the differential amount between the property's stamp duty valuation and the sale consideration.
Held
The Tribunal held that the differential amount was Rs. 3,91,000/-, which was not more than the 10% tolerance limit introduced in Section 56(2)(x)(b)(ii) of the Act. Therefore, the addition was unsustainable and deleted.
Key Issues
Whether the addition made under Section 56(2)(x) of the Income Tax Act, 1961, concerning the difference between stamp duty valuation and sale consideration is sustainable when it falls within the 10% tolerance limit.
Sections Cited
250, 56(2)(x), 56(2)(x)(b)(ii)
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Income Tax Appellate Tribunal, Mumbai “K (SMC
Before: Shri Narender Kumar Choudhry (JM) & Shri Prabhash Shankar (AM)
Assessee by : Shri Vimal Punmiya, Ld. CA Revenue by : Shri Bhagirath Ramawat, Ld. DR Date of Hearing : 29 /09/2025 Date of : 16/12/2025 pronouncement O R D E R Per Narender Kumar Choudhry (JM) :-
This appeal has been preferred by the assessee against the order dated 19.12.2023 impugned herein passed by the Learned Commissioner of Income Tax/NFAC, Delhi (in short Ld. Commissioner) under section 250 of the Income Tax Act, 1961 (in short ‘Act’) for A.Y. 2018-19.
2 Manekchand Devichand Bafna HUF
In the instant case, admittedly the differential amount between the stamp duty valuation of the property to the tune of Rs. 1,15,91,000/- and the sale consideration shown by the Assessee at Rs. 1,12,00,000/- is of Rs. 3,91,000/- only, which is admittedly not more than 10% the tolerance limit, as introduced in section 56(2)(x)(b)(ii) of the Act. Hence, the addition of Rs. 3,91,000/- made under section 56(2)(x) of the Act by Assessing Officer and affirmed by Ld. Commissioner, is unsustainable and therefore the same is deleted.
In the result, assessee’s appeal is allowed. Order pronounced in the open Court on 16/12/2025. ssSd/- Sd/- Sd/- Sd/- (Prabhash Shankar) (Narender Kumar Choudhry) ACCOUNTANT MEMBER JUDICIAL MEMBER Copy of the Order forwarded to :
1. 1. The Appellant 2. The Respondent.