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Income Tax Appellate Tribunal, “SMC” BENCH, MUMBAI
Before: HON’BLE SHRI AMARJIT SINGH, JM & HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM
आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member) 1. Aggrieved by confirmation of certain addition of Rs.18.30 Lacs u/s 56(2)(viib) by Ld. Commissioner of Income Tax (Appeals)- 38, Mumbai {CIT(A)} order dated 30/05/2019, the assessee is in further appeal before us. 2. The fact leading to additions are that while framing an assessment u/s 143(3) on 24/12/2018, it was noted by Ld. Assessing Officer (AO) that assessee had purchased three flats during the year. There was difference of Rs.22.33 Lacs in agreement value of the three flats vis-à-vis stamp duty value as per the following details: - No. Details of Market value as Agreement Difference in Rs. property per Stamp Duty Value in Rs. & (%) Valuation in Rs. 1. A-303 64,52,000/- 58,00,000/- 6,52,000/- (10.10%)
A-304 73,78,000/- 62,00,000/- 11,78,000/- (15.96%)
A-305 1,29,03,000/- 1,25,00,000/- 4,03,000/- (3.12%) Total 2,67,33,000/- 2,45,00,000/- 22,33,000/- (8.35%) All flats were situated at 3rd floor, Plot No.1, Basant Vihar CHS Ltd., Dr. C.P.Gidwaney Road, Chembur, Mumbai- 400 074. The Ld. AO, invoking the provisions of Sec.56(2)(vii)(b), added difference of Rs.22.33 Lacs in the hands of the assessee. 3. During appellate proceedings, the assessee assailed the action of Ld. AO, inter-alia by pleading that on an overall basis, the difference was only 8.35% and therefore, the additions were not justified. It was also submitted that due to prevailing economy, there was considerable recession in the real estate market. Reliance was placed on the decision of this Tribunal in John Flower India V/s DCIT, Mumbai (ITA No. 545/Mum/2014) wherein it was held that since the difference was less than 10%, the declared value was to be accepted. The decision of Hon’ble Supreme Court in C. B. Gautam V/s Union of India (199 ITR 53) held that no additions was to be made in case the difference was less than 15%. However, Ld. CIT(A) observed that on individual basis, the difference in value was to the extent of 10.10%, 15.96% and 3.12%, Therefore, in terms of cited decision of Mumbai Tribunal, addition with respect to flat No.A-305 was to be deleted. However, in case of other two flats, since the difference was more than 10%, the addition was to be confirmed. Aggrieved, the assessee is in further appeal before us.
We have carefully considered the factual matrix as well as the orders of lower authorities. Upon perusal of impugned order, it could be gathered that Ld. CIT(A), relying upon the cited order of Tribunal in John Flower India V/s DCIT, Mumbai (ITA No. 545/Mum/2014), has deleted the addition with respect to flat no.3 since the consideration was within the tolerance range of 10%. However, it could be seen that on an overall basis, the difference is 8.35% which is still within tolerance range of 10%. This range has been held to be retrospective in nature in the decision of Mumbai Tribunal in Maria Fernandes Cheryl V/s ITO (ITA No.4850/Mum/2019 dated 15/01/2021) wherein it was held by the coordinate bench that the amendment was curative in nature to avoid unintended consequences and therefore, safe harbor limit of 10% was to be given retrospective effect from the point of time when the related legal provisions were introduced. Therefore, the facts of the case do not convince us to confirm the impugned additions of Rs.18.30 Lacs. By deleting the same, we allow the appeal.
The appeal stands allowed in terms of our above order. Order pronounced on 14th September, 2021.
Sd/- Sd/- (Amarjit Singh) (Manoj Kumar Aggarwal) न्याययक सदस्य / Judicial Member लेखा सदस्य / Accountant Member मुंबई Mumbai; यदनांक Dated : 14.09.2021 Sr.PS, Dhananjay आदेशकीप्रधिधलधपअग्रेधर्ि/Copy of the Order forwarded to : 1. अपीलाथी/ The Appellant 2. प्रत्यथी/ The Respondent 3. आयकरआयुक्त(अपील) / The CIT(A) आयकरआयुक्त/ CIT– concerned 4. यवभागीयप्रयतयनयध, आयकरअपीलीयअयधकरण, मुंबई/ DR, ITAT, Mumbai 5. 6. गार्डफाईल / Guard File