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Facts
The assessee filed an e-return for AY 2018-19, which was selected for scrutiny. The Assessing Officer (AO) made an addition of Rs. 6,37,370/- under section 56(2)(X) of the Act, considering the difference between the stamp duty value and the agreement value of a property. The assessee contended that the stamp duty value at the time of agreement should be considered, not the registration date.
Held
The CIT(A) confirmed the addition made by the AO, stating that the stamp value on the date of agreement was higher than the agreement value. However, the Tribunal found that the CIT(A) dismissed the appeal without considering the evidence and submissions provided by the assessee and without providing proper opportunity for hearing.
Key Issues
Whether the CIT(A) erred in confirming the addition made by the AO by considering the stamp duty value on the date of registration instead of the date of agreement, and whether the appeal was dismissed without proper consideration of evidence and opportunity of being heard.
Sections Cited
250, 143(3), 143(3A), 143(3B), 56(2)(X), 250(6)
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Before: MS. SUCHITRA RAGHUNATH KAMBLE & SHRI BIJAYANANDA PRUSETH
आदेश / O R D E R
PER BIJAYANANDA PRUSETH, AM:
This appeal by the assessee emanates from the order passed under section 250 of the Income-tax Act, 1961 (in short, ‘the Act’) dated 30.04.2024 by the National Faceless Appeal Centre (NFAC), Delhi/Commissioner of Income-tax (Appeals) [in short, ‘CIT(A)’] for the Assessment Year (AY) 2018-19, which in turn arises out of an assessment order passed by National e- Assessment Centre Delhi/Assessing Officer (in short, ‘AO’) u/s 143(3) r.w.s. 143(3A) & 143(3B) of the Act dated 04.02.2021.
Grounds of appeal
raised by the assessee are as under:
1. That on the facts and circumstances of the case as well as law on the subject, the learned CIT(A) has erred in facts and law, in dismissing the appeal, A.Y 18-19 Miilan A Shah without providing proper opportunities of being heard and without considering the explanation submitted by the assessee.
2. That on the facts and circumstances of the case as well as law on the subject, the learned CIT(A) has erred in confirming the action of Ld. Assessing Officer in taking date of registration for deriving stamp duty value of the property instead of date of agreement without considering the fact that assessee has already made the part payment on the date of agreement.
3. That on the facts and circumstances of the case as well as law on the subject, the learned CIT(A) has erred in confirming the action of ld. Assessing Officer in making addition of Rs.6,37,370/- u/s 56(2)(X) of the Act on account of difference between actual purchase consideration and stamp duty value of the property on date of registration of the deed of the property.
The appellant craves to add, alter, vary any or all grounds of appeal either before or in the course of hearing of the appeal.”
Facts of the case in brief are that the assessee filed his e-return on 21.08.2018. The case was selected for scrutiny and notices u/s 143(2) and 142(1) were issued and served upon the assessee. The case was selected for the reasons “purchase value of property along with income disclosed u/s 56(2)(x) is substantial less than the value as per stamp authority”. During assessment proceedings, assessee stated that he has 10% share in the property. He was asked as to why difference between stamp value of property at the time of registration and the agreement be not added to the total income. The assessee submitted that when the date of agreement and date of registration are different, the stamp value at the time of agreement is to be considered. The AO found that assessee made cheque payment of Rs.10,30,900/- on 08.02.2018 and not at the time of agreement. Since the assessee had not made any payment through banking channel at the time of A.Y 18-19 Miilan A Shah agreement, his contention was not accepted. Hence, 10% of the difference between ready reckoner value of the property of Rs.1,61,24,704/-at the time of registration and Rs.97,51,000/- as on the date of agreement i.e., 10% of Rs.63,73,702/-, being Rs.6,37,370/- was added to the total income. Aggrieved by the order of AO, assessee filed appeal before CIT(A).
4. Before CIT(A), assessee had filed written submission which is reproduced at para-3.1 of the appellate order. He submitted that the impugned property was purchased for Rs.97,51,000/- on 10.10.2012 and the rate was fixed on that day. He filed allotment letter in support of the contention. Subsequently, property was registered on 29.09.2017 for Rs.97,51,000/- but the stamp value as on that date was Rs.1,61,24,702/-. The assessee made payment of Rs.10,30,900/- on 08.02.2018. The assessee referred to Section 56(2)(x) of the Act and submitted that the assessee had made payment from his HUF account and the same was reflected as unsecured loan in balance-sheet of the assessee. However, the CIT(A) did not accept the reply of assessee and has confirmed the addition made by AO, by observing that on the date of agreement on 29.09.2017 the stamp value of the property was Rs.1,61,24,702/- whereas the agreement value was Rs.97,51,000/-.
Aggrieved by the order of CIT(A) assessee has filed present appeal before the Tribunal. The Ld. AR filed a paper book and a written submission stating that the HUF of the assessee had paid Rs.10,00,000/- by two cheques of A.Y 18-19 Miilan A Shah Rs.5,00,000/- each to the developer on 10.10.2012, which was subsequently was repaid to HUF on 08.02.2018 by cheque of Rs.10,30,900/-. Therefore, provisions of Section 56(2)(x) are not applicable. He submitted that the CIT(A) has not considered the details submitted by the appellant and passed non- spealing order dismissing the appeal of the appellant.
On the other hand, Ld. Sr-DR for the revenue relied on the orders of the lower authorities and submitted that addition of Rs.6,37,302/- may be upheld.
We have heard both the parties and perused the materials available on record. We find that the CIT(A) has dismissed the appeal without considering the submission of the appellant made during the appellate proceeding. The appellant had furnished various details such as allotment letter issued by the builder, bank statemen of Milan Shah(HUF) evidencing payment of advance, balance-sheet of M/s Ambaji Textiles [Prop. Milan Shah(HUF)], ledger account of Milan Shah evidencing repayment of the loan, bank statement etc. during the appellate proceedings, which were not considered by the CIT(A). Thus, the order of CIT(A) has been passed without considering the details and explanation of the appellant and without providing further opportunity, if any clarification or verification was needed. We also find that the order is in clear violation of provision of Section 250(6) of the Act which specifies that the appellate order shall state the point of determination, the decision thereon and the reasons for the decision. In view of the above facts, the order of CIT(A) is set aside and the matter is restored to his file for re-adjudication after