M/S. GAURAV INVESTMENTS ,MUMBAI vs. DCIT, CC-8(1), MUMBAI
Income Tax Appellate Tribunal, “G” BENCH, MUMBAI
Before: HON’BLE JUSTICE (RETD.) C V BHADANG & MS PADMAVATHY S, AM
Per Padmavathy S, AM:
This appeal by the assessee is against the order of the Commissioner of Income Tax (Appeals)-50, Mumbai [In short 'CIT(A)'] passed under section 250 of the Income Tax Act, 1961 (the Act) dated 21.06.2024 for AY 2017-18. The assessee raised the following grounds of appeal:
“1. On the facts and in the circumstances of the case and in law the learned
Commissioner of Income Tax(Appeals)-50, Mumbai, erred in upholding the action of the learned Assessing Officer in reopening the assessment u/s.147 of the income tax act 1961, ignoring fact that, the circle rates fixed for stamp duty purposes are to be used only for a guideline purpose and cannot be universally applied without considering the intricacies of individual properties.
On the facts and circumstances of the case and in law, the learned Commissioner of Income Tax(Appeal)-50, Mumbai, erred in confirming the addition of Rs.4,46,63,000/- u/s.43CA in this assessment year, whereas the plain reading of section 43CA suggests, that this addition can be made only in the year in which the project is completed.
On the facts and in circumstances of the case and in law, the learned Commissioner of Income (Appeal)-50, Mumbai erred in confirming the addition u/s.43CA in respect of property whose agreement value was only 6.6% less than the value fixed for stamp purposes ignoring the fact, that, the amendment to section 43CA by finance acts of 2018 and 2020, being curative in nature had retrospective effect from the day 43CA was introduced in the act.
On the facts and circumstances of the case and in law, the learned Commissioner of Income Tax (Appeal)-50, Mumbai failed to take note of the fact, that the value arrived at by the DVO was only 2.46% and 1.55% more than the agreement values of the two properties and such small differences should be ignored when applying the provisions of section 43CA.”
The assessee is a partnership firm and engaged in the business of construction of residential and commercial buildings. The assessee filed the return of income for AY 2017-18 on 31.03.2018 declaring a total income of Rs. 9,31,50,840/-. The assessee's case was selected for scrutiny and the assessment under section 143(3) of the Act was completed accepting the income returned by the assessee. Subsequently, the AO received information from the Sub-