BALAMURUGESH PALANIAPPA KULANDAVELU,CHENNAI vs. DCIT, CIRCLE-1 LTU,, CHENNAI

ITA 3246/CHNY/2025Status: DisposedITAT Chennai07 October 2026AY 2018-195 pages
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What did the Tribunal hold?

The Tribunal observed that the difference between the sale consideration (Rs. 1,02,10,000/-) and the stamp duty value (Rs. 1,07,32,100/-) was approximately 5.11%. The Tribunal noted the special provision for full value of consideration in certain cases under Section 50C(1), including the proviso where the stamp valuation authority's value does not exceed 110% of the consideration. In view of this, the Tribunal set aside the value adopted by the AO and accepted the value declared by the assessee at Rs. 1,02,10,000/-. Regarding the cost of acquisition and other grounds, the Tribunal found that the property included a building and other structures, as evidenced by the purchase deed. Relying on the paper book submitted by the assessee, the Tribunal restored the matter to the AO for reconsideration, directing the AO to consider the assessee's explanations and evidence after providing a proper opportunity of being heard. The assessee was also directed to participate without seeking adjournments. The grounds of appeal were partly allowed for statistical purposes.

What were the facts?

The assessee, Balamurugesh Palaniappa Kulandavelu, filed an appeal before the Income Tax Appellate Tribunal (ITAT), Chennai, against the order of the Commissioner of Income Tax (Appeals) / NFAC, Delhi, for Assessment Year 2018-19. The assessee had sold an immovable property for Rs. 1,02,10,000/-. The Assessing Officer (AO) reopened the case under Section 148 after the assessee failed to file a return within the stipulated time. The AO made an addition of Rs. 94.11 lakhs under long-term capital gains, applying Section 50C of the Income Tax Act, 1961, by considering the stamp duty value of Rs. 1,07,32,100/-. The CIT(A) partly allowed the appeal, confirming the application of Section 50C. The assessee's property was purchased on 15.11.1991 for Rs. 4,24,000/-.

What were the issues?

1. Whether the Ld. CIT(A) erred in adopting the Stamp Duty Value as the full value of consideration by applying Section 50C of the IT Act, when the difference between the stamp duty value and sale consideration was only 5.11%, which is within the tolerable margin. - Assessee's contention: The difference is within the 10% margin provided under Section 50C, and the amendment increasing the margin to 10% should have retrospective effect. - Revenue's contention: Not recorded. 2. Whether the Ld. CIT(A) erred in disallowing the cost of acquisition reported by the appellant (fair market value as on 01.04.2001) and adopting the cost of acquisition as on 15.11.1991, in contravention to Section 55(2)(b) of the Act. - Assessee's contention: The guideline value as on 01.04.2002 justifies the cost of acquisition adopted as on 01.04.2001. The sale deed included a building, and its fair value should be included in the cost of acquisition. The Ld. CIT(A) disallowed expenses without valid reasons and considered only part of the submitted statement. - Revenue's contention: Not recorded. 3. Whether the Ld. CIT(A) failed to consider the evidence, decisions, and submissions, violating principles of natural justice.

Which sections of the Income-tax Act were involved?

Section 50C,Section 48,Section 55(2)(b),Section 139(1),Section 139(4),Section 148,Section 282

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘A’ BENCH: CHENNAI

Before: HONOURABLE SHRI S.S. VISWANETHRA RAVI & SHRI GAGAN GOYAL

Hearing: 11.08.2026Pronounced: 07.10.2026

PER GAGAN GOYAL, AM: This is an appeal preferred by the assessee against the order of Ld. Commissioner of Income Tax (A) / NFAC, (hereinafter referred as the ‘Ld. CIT(A)’), Delhi dated 06.10.2025 for the Assessment Year (hereinafter referred as the ‘AY’) 2018-19. GROUDS OF APPEAL

1.

1 The Ld. CIT(A) erred in adopting the Stamp D

The order continues below.

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