RAJIV KUMAR SINHA,BOKARO vs. ITO WARD-3(2), BOKARO

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ITA 46/RAN/2018Status: DisposedITAT Ranchi27 August 20193 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that Section 56(2)(vii)(b)(ii) of the Income Tax Act, applicable from Assessment Year 2014-15, taxes the difference between the stamp duty value and the consideration as income from other sources.

What were the facts?

The assessee purchased a flat for Rs. 26,70,000, while the stamp duty value was Rs. 29,10,000. The Assessing Officer added the difference of Rs. 2,40,000 to the assessee's income.

What were the issues?

Whether the differential amount between the stamp duty value and the consideration for a property purchase is taxable as income from other sources for AY 2014-15.

Which sections of the Income-tax Act were involved?

Section 56(2)(vii)(b)(ii)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, RANCHI BENCH, RANCHI

Before: S/SHRI CHANDRA MOHAN GARG & LAXMI PRASAD SAHU

For Appellant: Shri Rakesh Kumar Sinha, Adv
For Respondent: Shri P.K.Mondal, Addl. CIT(DR)
Hearing: 27/08/2019Pronounced: 27/08/2019

IN THE INCOME TAX APPELLATE TRIBUNAL, RANCHI BENCH, RANCHI

BEFORE S/SHRI CHANDRA MOHAN GARG, JUDICIAL MEMBER AND LAXMI PRASAD SAHU, ACCOUNTANT MEMBER

ITA No.46/Ran/2018 Assessment Year: 2014-15

Rajiv Kumar Sinha, Sector-1/C, Vs. ITO, Ward 3(2), Bokaro Qr. No.1206, Bokaro Steel City,- 827001 PAN/GIR No.BIKPS 8203 A (Appellant) .. ( Respondent)

Assessee by : Shri Rakesh Kumar Sinha, Adv Revenue by : Shri P.K.Mondal, Addl. CIT(DR) Date of Hearing : 27/08/2019 Date of Pronouncement : 27/08/2019

O R D E R Per Bench This is an appeal filed by the assessee against the order of the

Commissioner of Income Tax(Appeals)- Hazaribag dated 27.6.2017 for the

assessment year 2014-15.

2.

The sole issue involved in this appeal is that the Commissioner of

Income Tax(Appeals) was not justified in confirming the difference amount

of Rs.2,40,000/- being the amount paid to the builder and also stamp duty

paid to the State Government.

3.

The relevant material facts are like this. During the course of

assessment proceedings, the Assessing Officer noticed that the assessee

had purchased a flat in Ranchi for a consideration of Rs.26,70,000/-,

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ITA No.46/R an/2018 Ass essment Year : 2014 -15

whereas stamp duty has been paid as per Government rate i.e.

Rs.29,10,000/-. Therefore, the Assessing officer treated the difference

amount of Rs.2,40,000/- (Rs.29,10,000 – Rs.26,70,000) and added the

same to the income of the assessee as income from other sources.

4.

On appeal, the CIT(A) held that as per section 56(2)(vii)(b)(ii) of the

Act, the differential amount would be taxed as deemed income of the

taxpayer and hence upheld the action of the Assessing Officer.

5.

Before us, ld A.R. submitted that the assessee had purchased a flat in 5th November, 2013 for a consideration of Rs.26,70,000/-. He submitted

that as per section 56(2)(vii)(b), as substituted by the Finance Act, 2013

w.e.f. 1.4.2014, if immovable property is transferred for a consideration

which is less than the stamp duty value, the difference is assessable as

income in the transferee’s hands as income from other sources. He

submitted that the provisions of section 56(2)(vii)(b)(ii) was not effective

during the financial year 2013-14 relevant to assessment year 2014-15,

therefore, the differential amount of Rs.2,40,000/- will not be taxed in the

hands of the assessee.

6.

Replying to above, ld D.R. submitted that the assessment year

involved in this case is 2014-15 He submitted that Section

56(2)(viii)(b)(ii) clearly stipulates that where any immoveable property is

received for a consideration which is less than the stamp duty value of the

property by an amount exceeding Rs.50000/-, the stamp duty value of such

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ITA No.46/R an/2018 Ass essment Year : 2014 -15

property as exceeds such consideration, shall be chargeable to tax in the

hands of the individual or HUF as income from other sources and it is

applicable from A.Y. 2014-15.

7.

We have heard the rival submissions and perused the record of the

case. It is an admitted fact that section 56(2)(vii)(b)(ii) of the Act is

applicable from the assessment year 2014-15 and, therefore, the differential

amount towards purchase of flat is taxable in the hands of the assessee.

Since the assessment year involved in this appeal is 2014-15, we find no

error in the order of the CIT(A) in view of the mandatory provisions of the

Act and, accordingly, uphold the same.

8.

In the result, appeal filed by the assessee is dismissed.

Order pronounced on 27/08/2019. Sd/- sd/- (Laxmi Prasad Sahu) (Chandra Mohan Garg) ACCOUNTANT MEMBER JUDICIALMEMBER Ranchi; Dated 27 /08/209 B.K.Parida, SPS

Copy of the Order forwarded to : 1. The Appellant : Rajiv Kumar Sinha, Sector-1/C, Qr. No.1206, Bokaro Steel City,-827001

2.

The Respondent. ITO, Ward 3(2), Bokaro 3. The CIT(A)- Hazaribag 4. Pr.CIT-Hazaribag 5. DR, ITAT, Ranchi 6. Guard file. By order //True Copy//

Sr. Pvt. Secretary, ITAT, Cuttack camp at Ranchi

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