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Facts
The assessee purchased an SCO for Rs. 22 lacs, but the AO made an addition of Rs. 77,27,500/- for unexplained investment based on a higher fair market value derived from other transactions. The CIT(A) deleted this addition, following a previous order.
Held
The Tribunal held that the issue was covered by previous orders of the Coordinate Bench and other similar cases where similar additions were deleted. Therefore, the addition made by the AO was not liable to be sustained.
Key Issues
Whether the addition on account of unexplained investment for the purchase of SCO, based on extrapolation of sale rate, is sustainable when similar additions have been deleted in preceding cases?
Sections Cited
139(1), 69B, 115BBE, 132(4)
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िनधा"रती की ओर से/Assessee by : Shri Sudhir Sehgal, Advocate राज" की ओर से/ Revenue by : Smt. Tarundeep Kaur, CIT, DR (Virtual Mode) सुनवाई की तारीख/Date of Hearing : 10/12/2025 उदघोषणा की तारीख/Date of Pronouncement : 30.12.2025 आदेश/Order PER KRINWANT SAHAY, A.M: This is an appeal filed by the Revenue against the order of the Ld. CIT(A)-5, Ludhiana dt. 13/11/2024 pertaining to Assessment Year 2022-23. 2. In the present appeal Revenue has raised the following grounds:
1. Whether upon facts and circumstances of the case and in law, the Ld. CIT(A) was justified to delete the addition of Rs. 77,27,500/- made by the A.O. on account of unexplained investment for purchase of SCO on the basis of logical Et rational extrapolation based on evidences? 2. Whether upon facts and circumstances of the case and in law, the valuation report by valuer, various documents found during search and statements of persons recorded uls 132(4) not constitute incriminating documents for determining true purchase price of the property? 3. The appellant craves leave to add, amend, modify, vary, omit or substitute any of the aforesaid grounds of appeal at any time before or at the time of hearing of appeal.
3. Briefly, the facts of the case are that assessee has filed the return of income u/s 139(1). The case pertains to group case of M/s Homelife Buildcon Pvt. Ltd., where a search and seizure action took place on 16.11.2021. Thee assessee had purchased a SCO bearing No. 3, measuring 144.44 sq. yards in the colony of said company for Rs. 22 lacs. However as per the 2 information gathered during the course of assessment proceedings in the case of M/s Homelife Buildcon Pvt. Ltd., that the fair market value of residential plot/SCO were much higher than the registered value. While framing the assessment of M/s Homelife Buildcon Pvt. Ltd. the value of one SCO sold by the company to various buyers was determined at Rs. 99,27,500/- against the registered value of consideration at Rs. 22 lacs as in the case of assessee. Accordingly, it was held by the Assessing Officer that the assessee had made an "unexplained investment" of Rs. 77,27,500/ (Rs.99,27,500 minus 22,00,000) u/s 69B r.w. the provisions of section 115BBE was also made available.
4. Against the order of the AO the assessee went in appeal before the Ld. CIT(A) and the Ld. CIT(A) vide order, dated 13.11.2024 deleted the addition by following his own order in the case of M/s Homelife Buildcon Pvt. Ltd., which he had decided on 19.07.2024, wherein, the said addition as made by the Assessing Officer in the case of "M/s Homelife Buildcon Pvt. Ltd.", by extrapolation of sale rate of SCO had been deleted by him. He reproduced findings given in his own order at pages 11 to page 13 of the order and deleted the addition.
5. Against the order of the Ld. CIT(A) the Revenue preferred in appeal before the Tribunal.
6. At the very outset, it was brought to our notice by the Ld. Counsel of the assessee that the issue of extrapolation of the sale rate of SCO in the case of M/s Homelife Buildcon Pvt. Ltd., has attained finality by the order of Coordinate Bench in the case of M/s Homelife Buildcon Pvt. Ltd., bearing and ITA No.1036/Chd/2024. It was further contended by the Ld. Counsel that in the case of Sh. Balwinder Singh, the same issue of purchase of SCO was there from "M/s Homelife Buildcon Pvt. Ltd.", The said addition was deleted by the CIT(A), following the order of "M/s Homelife Buildcon Pvt. Ltd.", and the department had filed the appeal before the Tribunal bearing and Cross Objection No.7/Chd/2025, wherein vide order, dated 09.09.2025. The Tribunal dismissed the appeal of 3 the department following the order of the M/s Homelife Buildcon Pvt. Ltd., in ITA Nos.880,1036/Chd/2024.
7. We have gone through, the order of the Assessing Officer and Ld. CIT(A). Arguments of both sides and have also gone through the order of M/s Homelife Buildcon Pvt. Ltd., and Sh. Balwinder Singh as 'cited supra' and we find that the issue is covered in favour of assessee by way of order in the case of Sh. Balwinder Singh in and Cross Objection No.7/Chd./2025, wherein, following finding has been recorded:-
10. We have gone through the order of the AO, order of the CIT(A) arguments of both the sides and the order of ITAT in the case of Homelife Buildcon Pvt. Ltd. as cited supra. We find that in the hands of company i.e. Homelife Buildcon Pvt.Ltd., similar addition was made on the basis of same facts and that addition did not find favour with the CIT(A), who relied upon his earlier order and when the matter came before the ITAT, the order of CIT(A) deleting the addition was confirmed, the ITAT has deleted the addition in the case of Homelife Buildcon Pvt. Ltd. on account of SCO and on similar facts and circumstances, the said addition of Rs. 77,27,500/- is not liable to be sustained in the case of purchaser of SCO and, as such, the departmental appeal is dismissed.
Thus, following the order in the case of Sh. Balwinder Singh and Others as cited supra, we have no hesitation in dismissing the appeal of the Revenue. 8. In the result, the appeal of the Revenue is dismissed.