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Facts
The assessee sold a property for Rs. 25 lakhs, but the stamp duty valuation was Rs. 35,02,000/-. The AO treated the entire sale consideration as unexplained income. The addition was confirmed by the CIT(A).
Held
The Tribunal held that since the entire sale consideration and the capital gain arising from it were already assessed in the hands of the assessee's husband, who had declared the sale and offered the gain, adding the same amount as unexplained income in the assessee's hands was incorrect.
Key Issues
Whether the addition of entire sale consideration as unexplained income is justified when the same has already been taxed in the hands of the co-owner husband.
Sections Cited
147, 144, 271(1)(c), 148, 50C
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Income Tax Appellate Tribunal, ‘H (SMC
Before: SHRI AMIT SHUKLA & MS. PADMAVATHY S
आदेश / O R D E R PER AMIT SHUKLA (J.M): In so far as the appeal in the same has been filed against order dated 12/12/2023 passed by NFAC, Delhi for the quantum of assessment passed u/s.147 r.w.s. 144 for the A.Y. 2012-13, whereas the appeal in , the same has been filed against order dated & 19/Mum/2025 Smt Bharati Manohar Punjabi 16/04/2024 passed by NFAC in relation with the penalty proceedings u/s. 271(1)(c).
In the quantum of appeal, assessee has challenged the action of the ld. AO for treating the entire sale consideration as per stamp duty value as ‘unexplained income’ in the hands of the assessee.
The brief facts as culled out from the records are that assessee alongwith her husband had sold house property situated at Section 19/20, Flat No 701, 7th Floor, Shree Satyam Co-op. Hsg. Society Ltd Plot No 51 Setor-20, Kharghar for a consideration of Rs.25 lakhs. However, as per the Index II issued by Department of Registration, market value of the said property was Rs.35,02,000/-. Since assessee could not comply with the notice u/s.148 and other notices, ld. AO has treated the sale consideration as per the market value at Rs.35,02,000/- and the entire sales consideration has been added as ‘unexplained income’ of the assessee. Ld. CIT (A) too has confirmed the said addition on the ground that the notices remain un-complied with.
Before us it had been stated that the property sold was in the joint ownership alongwith assessee’s husband, Mr. Manohar Punjabi. It has been brought on record that Mr. Manohar Punjabi has disclosed sales consideration on the flat at Rs.25 lakhs and computed long term capital gain in his return of income. However, in his case, assessment order u/s.144 r.w.s.147 has been passed wherein the capital gain was & 19/Mum/2025 Smt Bharati Manohar Punjabi computed by taking the sale consideration at Rs.35,02,000/- which on account of difference between sale value and the market value. Thus, the assessment was completed after making the addition after computing the long term gain by taking sale consideration at Rs.35,02,000/-. The copy of the assessment order has also been filed before us. It had been further stated the husband has accepted the addition and the computation of long term capital gain and therefore, there is no reason to make any addition in the hands of the assessee.
The ld. DR admitted the same that this amount has already been subject to assessment in the case of her husband Mr. Manohar Punjabi.
After perusing the facts and material on record it is seen that the assessee alongwith her husband owned the property which was sold for consideration of Rs.25 lakhs. The said sale consideration has been disclosed in the return of income of Mr. Manohar Punjabi who has computed the long term capital gain in the return of income. Based on the same information, the case was reopened in his case and assessment order dated 17/12/2019 was passed wherein the difference between the sale consideration and market value was added u/s.50C and accordingly, long term capital gain was computed by taking the sale consideration at Rs.35,02,000/-. Thus, when the entire sale consideration has been considered in the hands of the assessee’s husband Mr. Manohar Punjabi, then there is no reason to make the addition on account of entire sale consideration in the hands
Since we have deleted the addition, penalty u/s.271(1)(c) and such addition does not have any legs to stand. Accordingly, the penalty levied by the ld. AO is also deleted.
In the result, both the appeals of the assessee are allowed. Order pronounced on 22nd April, 2025.