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Facts
The assessee, a non-resident US citizen, booked a flat in Mumbai and made payments between 2011-2018. As no income tax return was filed, an assessment was reopened under section 148, proposing an addition to income. The DRP confirmed additions of Rs. 1,00,000 for an unexplained cash deposit and Rs. 4,32,280 for stamp duty and registration charges.
Held
The Tribunal deleted the addition of Rs. 1,00,000, accepting the assessee's explanation that the cash deposit for the flat advance was sourced from prior NRE account withdrawals. It also deleted the addition of Rs. 4,32,280 for stamp duty and registration charges, as the assessee provided a bank challan and a notarized affidavit from the developer confirming these payments were part of the flat purchase consideration.
Key Issues
The key issues were the confirmation of additions under Section 69 for an unexplained cash deposit and unexplained stamp duty and registration charges related to a flat purchase.
Sections Cited
143(3), 144C(13), 148, 69
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, AHMEDABAD “D” BENCH
Before: DR. BRR Kumar & Shri T. R. Senthil Kumar
ITA No: 386/Ahd/2025 Assessment Year: 2016-17 Sureshkumar Kasturram Income Tax Officer, Purohit Int. Tax, A/501-F, Jaswanti Allied Vs Ward-2, Business Centre, Ahmedabad Ramchandra Lane Extn., Kanchpada, Mumbai, Maharashtra-400064 PAN: BLUPP3797D (Appellant) (Respondent) Assessee Represented: Shri Ketan Vajani, A.R. Revenue Represented: Shri Kamlesh Makwana, CIT-DR Date of hearing : 09-02-2026 Date of pronouncement : 13 -02-2026 आदेश/ORDER PER : T.R. SENTHIL KUMAR, JUDICIAL MEMBER:-
This appeal is filed by the Assessee as against the final assessment order dated 19-12-2024 passed under section 143[3] rws 144C[13] of the Income Tax Act, 1961 [hereinafter referred as ‘the Act’] by the Assistant Commissioner of Income Tax relating to the Assessment Year 2016-17.
Brief facts of the case is that the assessee is non-resident residing in USA since April 2002 and is citizen of USA. The assessee booked a residential flat at Kandawali West, Mumbai in the Year 2011 for a consideration of Rs.79,90,500/- from M/s. Versatile Properties Pvt. Ltd., Mumbai. Agreement for the same was executed on 20-07-2015, payments for booking of said flat was made during the period from 2011 to 2018. Payments were made by the assessee through his NRE/NRO account with HDFC Bank and also by his own brother Mr. Jitesh Kumar Purohit, who is also an NRI. Since the assessee has not filed he Return of Income, the assessment was reopened by issuing a notice u/s. 148 dated 23- 03-2023.
2.1. In response, the assessee filed a belated return which was considered invalid one. Therefore the Assessing Officer issued draft assessment order dated 26-03-2024 u/s. 144C of the Act proposing assess the total income of Rs.57,24,172/-. The assessee filed objections before DRP, Ld. DRP called for Remand Report from the assessing officer and deleted an amount of Rs.51,90,500/- was explained properly with documentary evidences for the investments made by the assessee and remaining amount of Rs.1,00,000/- cash deposit and Rs. 4,00,000/- being registration charges and Stamp Duty of Rs.32,280/- remained unexplained and therefore confirmed the same.
Aggrieved against the order, the assessee is in appeal before us raising the following Grounds of Appeal:
1. The Dispute Resolution Panel, hereinafter referred to as the "DRP", has erred in confirming the addition to the extent of Rs. 5,32,280/- u/s. 69 of the Act as against the proposed addition of Rs. 57,24,172/- as per the Draft Assessment Order. The DRP has erred in not appreciating correct facts of the case while confirming the impugned addition.
2. The DRP has erred in not appreciating the fact that the appellant had deposited cash of Rs. 1,00,000/- in the bank account out of cash available with him out of earlier withdrawals. The DRP has confirmed addition in relation to the same merely on conjectures, surmises and suspicions.
3. The DRP has erred in not appreciating the fact that the payment of stamp duty - Rs. 4,00,000/- and registration fees Rs. 32,280/-, thus aggregating to Rs. 4,32,280/- was made by the builder and not paid by the appellant separately. The DRP has erred in not appreciating that the total payments made by the appellant to the builder includes the payments towards stamp duty and registration fees and the appellant has explained the source of the same. Accordingly the addition in respect of the same is not justified.
The appellant respectfully submits that the impugned addition is not justified on the facts of his case. The appellant, therefore, prays that the addition of Rs. 5,32,280/- may please be deleted or any other relief as deemed fit may please be allowed.
4. Ld. Counsel for the assessee submitted before us bank statements relating to the year 2015, wherein cash deposit in HDFC Bank account of Rs.1,00,000/- and the same was utilized for payment of advance of booking of flat. The assessee also explained that the source of cash withdrawal from assessee’s NRE account aggregating to Rs.1,08,000/- during 05-03-2009 to 25-03- 2009 and relevant NRE bank account placed on record. Considering the same, the assessee’s visit to India, the addition of Rs. 1,00,000/- made is hereby directed to be deleted.
5. Regarding the Stamp duty paid to Rs.4,00,000/- and registration charges of Rs.32,280/- which were found part of the payments made by the assessee to the developer M/s. Versatile Properties A.Y. 2016-17 Page No 4 Sureshkumar Kasturram Purohit vs. ITO Pvt. Ltd. The assessee produced before us copy of the bank challan for payment of Rs.4,00,000/- for Stamp duty and Rs.32,280/- towards registration charges receipt issued by Sub-Registrar Office, Borivali. The assessee also filed Notarized Affidavit from the developer M/s. Versatile Properties Pvt. Ltd. dated 21-04-2025 confirming that the payment made by the assessee towards the purchase of flat which includes the Stamp duty and registration charges. Though this affidavit is a new document but supported with the registered documents of May, 2015. We therefore hereby direct the assessing officer to delete the above additions of Rs.4,32,280/- on these counts.
In the result, the appeal filed by the Assessee is hereby allowed.