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Facts
The assessee purchased a property for Rs. 93,77,103, with a stamp duty value of Rs. 2,69,74,200. The AO added back the difference as per section 56(2)(vii)(b) of the Income-tax Act, 1961, treating it as income from other sources, which was upheld by the CIT(A). The assessee appealed, claiming the land was agricultural and thus not subject to this section.
Held
The Tribunal admitted the 'distance certificate' as additional evidence. The issue was remanded to the Assessing Officer for verification of the document and to determine the nature of the land. The land was already treated as agricultural in nature, but the AO needed to verify the additional evidence for limited purposes.
Key Issues
Whether the land purchased by the assessee is agricultural in nature, and if so, whether section 56(2)(vii)(b) is applicable.
Sections Cited
56(2)(vii)(b), 2(14)(iii), 250, 143(3)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, MUMBAI BENCH “E”, MUMBAI
Before: SHRI ANIKESH BANERJEE & SHRI PRABHASH SHANKAR
Mayur Kanubhai Shah vs ITO, Ward 19(2)(2), Mumbai 43/44, Pushpa Milan Sophia Piramal Chambers, Parel, Mumbai- College Lane, Off Bhulabhai 400012 Desai Road, Mumbai-400026 PAN : AADPS0509H APPELLANT RESPONDENT Assessee by : Shri Rishav Patawari Respondent by : Shri Ritesh Misra (CIT DR) Date of hearing : 13/01/2026 Date of pronouncement : 19/01/2026 O R D E R Per Anikesh Banerjee (JM): The instant appeal of the assessee is preferred against the order of the NFAC, Delhi [for brevity, ‘Ld. CIT(A)’] order passed under section 250 of the Income-tax Act, 1961 (for brevity, ‘the Act) for the Assessment Year 2016-17, date of order 20/08/2025. The impugned order emanated from the order of the Learned Income Tax Officer Ward 19(2)(3), Mumbai (for brevity, ‘the Ld.AO’) order passed u/s 143(3) of the Act, date of order 19/12/2018.
Mayur Kanubhai Shah 2. The brief facts of the case are that the assessee purchased the property with a value of Rs.93,77,103/-. The fair market value of the property for stamp duty purpose was Rs.2,69,74,200/-. During the assessment proceeding the Ld. AO asked the assessee for explanation related to difference of agreement value and the stamp duty value of the property which will contravening provision of section 56 (2)(viib) of the Act. The assessee complied & explained that the assessee purchased the said lad in nature rural agricultural land. So, the alleged section is not applicable for this land. Finally the Ld. AO rejected the assessee’s explanation and added back the difference amount to Rs.1,75,97,097/- under section 56(2)(viib). The aggrieved assessee filed an appeal before the Ld. CIT(A). The Ld. CIT(A) uphold the assessment order. Being aggrieved assessee filed an appeal before us.
The Ld. AR argued and filed a paper book comprising pages 1 to 26, which has been taken on record. The Ld. AR also filed a “distance certificate” as additional evidence to substantiate the claim that the subject property is situated far beyond the municipal limits. It was contended that the land transacted by the assessee is in the nature of rural agricultural land and, therefore, the provisions of section 56(2)(viib) of the Act are not applicable. With reference to section 2(14)(iii) of the Act, the Ld. AR submitted the said “distance certificate” as additional evidence in accordance with Rule 29 of the Income-tax (Appellate Tribunal) Rules, 1963. The Ld. AR first drew our attention to the deed of purchase duly executed on 15.07.2015, annexed at APB pages 1 to 16, wherein the property is described as agricultural land. The Ld. AR further contended that the certificate issued by the DVO, bearing No. DVO-I/Mum/CGT/2021-22/378 dated Mayur Kanubhai Shah 11.02.2022, annexed at APB pages 63 to 69, also records the fair market value of the immovable agricultural land situated at village Jamalpada, Taluka Sudhagad, District Raigad, and categorically determines the nature of the property as agricultural land (APB page 67). Without considering these evidences, the Ld. AO passed the order and confirmed the addition.
During the proceedings before the Bench, the Ld. AR, in further support of his submissions, stated that the distance certificate issued by the Sub-Divisional Officer, PWD, Sudhagad, specifies that the distance from Khopoli Nagar Parishad to Jambhulpada is 25 kilometres. The relevant documents are reproduced below:
The Ld. DR argued and placed reliance on the orders passed by the revenue authorities.
Mayur Kanubhai Shah 6. We have heard the rival submissions and perused the documents available on record. On consideration of the material placed before the Bench, we find that the assessee purchased the land vide a registered deed of purchase dated 15.07.2015. The assessee has placed reliance on the report of the DVO dated 11.02.2022, which supports the assessee’s claim that the land in question is in the nature of agricultural land. In order to further strengthen the submissions, the Ld. AR also filed a “distance certificate” before the Tribunal, which supports the applicability of section 2(14)(iii) of the Act. Accordingly, we admit the additional evidence filed by the assessee and remand the issue to the file of the Ld. Jurisdictional Assessing Officer (JAO) for due verification of the said document and for determining the nature of the land in accordance with law. From a perusal of the deed of purchase and the report of the DVO, the land has already been treated as agricultural in nature. However, for the limited purpose of verification of the additional evidence, the matter is remanded to the file of the Ld. JAO. Needless to say, the Ld. JAO shall duly consider the submissions of the assessee and afford a reasonable opportunity of being heard. Accordingly, the matter is remanded to the file of the Ld. JAO for this limited purpose.
Order pronounced in the open court on 19th day of January, 2026. Sd/- Sd/- (PRABHASH SHANKAR) (ANIKESH BANERJEE) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai,िदनांक/Dated: 19/01/2026 Saumya