SURAJMAL MISTRY HUF,MUMBAI vs. INCOME TAX OFFICER, WARD 22(3)(4), MUMBAI

Particulars Area (SQM) Ready Recknor Value Value Office area 51.52 1,58,400 81,60,768 Parking area 11.15 69,300 7,72,695 Total value 89,33,463 Unit-307 Particulars Area (SQM) Ready Recknor Value Value Office area 80.96 1,58,400 1,28,24,064 Parking area 11.15 69,300 7,72,695 Total value 1,35,96,759

“5.3.5 During the course of assessment proceedings, the AO had requested for the stamp duty value of the properties for the year 2010 which were Rs. 90,44,500/- for unit no. 306 and Rs. 1,45,90,500/- for unit no.

307. The AO then used the same for the calculation of income 56(2)(vii)(b)(ii) of the Act. The appellant argued that the stamp duty valuation received from the registrar seems to be on estimated basis and for the 2nd property ie. Unit no. 307, the registrar had applied the same rate for both office area and parking area. The appellant had submitted the stamp duty value of the properties as per ready reckoner 2010 which is Rs. 89,33,463/- for unit no. 306 and Rs. 1,35,96,759/- for unit no.

From the above discussions, it is held that the appellant had paid consideration less than the stamp duty value by an amount of Rs. 17,81,145/-. Accordingly, the AO is directed to restrict the addition u/s 56(2)(vii)(b)(ii) of the Act to Rs. 17,81,145/-. Hence, the ground of appeal no. 2 is Partly Allowed.”

6. The Assessee, being aggrieved, is in appeal before us and contradicted the findings of the Ld. Commissioner.

7. On the contrary the Ld. D.R. refuted the claim of the Assessee and supported the impugned order.

8. Heard the parties and perused the material available on record. Admittedly, the Assessee himself has submitted the stamp duty value of the property as per ready reckoner 2010 to the tune of Rs.89,33,463/- for unit no.306 and Rs.1,35,96,759/- for unit no.307, which was accepted by the Ld. Commissioner and therefore only he restricted the addition to the extent of Rs.17,81,145/- as against the addition of Rs.28,85,923/- and thus the Assessee is not entitled to challenge the said decision of the Ld. Commissioner in restricting the addition to the extent mentioned above.

8.1 The difference in the stamp duty value and consideration as tabulated below has been determined by the Ld. Commissioner by taking into consideration the submissions of the Assessee himself, which for the sake of gravity is reproduced herein below:

Particulars Property (Unit Property 2 (Unit Total No.306) No. 307) Stamp duty 89,33,463/- 1,35,96,759/- 2,25,30,222/- value of 2010 Purchase value 76,77,779/- 1,30,83,298/- 2,07,49,077/- Difference 12,66,684/- 5,14,461/- 17,81,145/- 8.2 It is observed by this Court that admittedly the difference in the stamp duty value and the purchase value {as declared by the Assessee} of unit no.307 is of Rs.5,14,461/- which is below than the amount equal to 5% of the consideration, as per exception carved out in the provisions of section 56(2) (x) (b) (B) (ii) and section 50(c) of the Act. Though the provisions of section 56(2)(x) and section 50(c) of the Act are not applicable to the instant case, as this case pertains to A.Y. 2015-16, however such provisions are corollary to the provisions of section 56(2)(vii) of the Act as applicable to the instant case, hence this Court considering the peculiar facts and circumstances in totality, the Assessee’s prayer for taking a lenient/liberal view, the substantial justice and in order to cut short the litigation, is inclined to delete the addition of Rs.5,14,461/- being difference between stamp duty value of Rs.1,35,96,759/- minus purchase value of Rs.1,30,82,298/- of unit no 307, being covered under exception carved out in the provisions of section 56(2) (x) (b)(B)(ii) of the Act. Thus the addition of Rs.5,14,461/- (pertaining to unit no 307) is deleted. Resultantly, addition of Rs.17,81,145/- as restricted by the Ld. Commissioner is accordingly, further reduced to Rs.12,66,684/-. Thus, the Assessee gets part relief.

Order pronounced in the open court on 28/02/2025.