RAMADEVI RAJGOPAL,CHENNAI vs. ITO, NCR-21(3), CHENNAI

आदेश / O R D E R PER INTURI RAMA RAO, ACCOUNTANT MEMBER:

2. The Assessee raised the following grounds of appeal:

ITA No.3153/2018 :- 2 -:

‘’1. The order passed by the Learned Commissioner of Income Tax (Appeals)- III is contrary to law and facts of the case.

2. The Learned Commissioner of Income Tax (Appeals)- III has erred in confirming the addition made by the Assessing Officer, a sum of Rs.37,00,000/- as “Income from other sources “ being the difference between actual consideration paid by the Appellant for acquiring an immovable property and the value adopted for Stamp Duty purposes by the State authorities.

3. The Learned Commissioner of Income Tax (Appeals)- III failed to consider the fact that the prevailing market value of the property at the time of purchase of the said property by the Appellant is less than the value adopted by the Assessing Officer.

5. The Learned Commissioner of Income Tax (Appeals)- III failed to appreciate the submissions of the Appellant that in taxing the difference between the consideration paid and the market value of the subject property u/s 56(2)(vii) of the Act amounts to double taxation in that seller of the property is already subject to tax u/s 50-C of the Act in separate proceedings.

For the grounds stated above and those that may be adduced at the time of hearing, the Hon’ble Income Tax Appellate Tribunal may be pleased to allow the appeal of the Appellant and grant appropriate relief/relief’s’’.

The brief facts of the case are as under: 3.

The appellant is an individual. The return of income for the assessment year 2015-2016 was filed on 27.08.2015 disclosing total income of Rs.4,83,150/-. Against the said return of income, the assessment was completed by Income Tax Officer, Non Corporate Ward 21(3), Chennai vide order dated 29.12.2017 passed u/s. 143(3) of the Income Tax Act, 1961 (for short ‘the Act’) declaring total income

ITA No.3153/2018 :- 3 -: of Rs. 41,93,153/-, while doing so, the Assessing Officer made addition of �37,00,000/- under the provisions of Section 56(2)(vii) of the Act, as purchased the following plots for a consideration less than the value adopted for stamp duty purpose.

‘’1. All that piece and parcel of land being vacant in No.68, Gerugambakkam Village, Sriperumbadur Taluk, Kancheeppuram District, bearing Plot No.283, Sri Kamaladevi Nagar, comprised in Survey No.757/i, Patta No.294, measuring of the extent of 800 sqft vide Document No: 3707/2014 on 26.05.2014 for a sale consideration of Rs.4,00,000, when the market value of the said property was Ps. 12,00,000 at the time of sale.

Being aggrieved by the above order, an appeal was 4. preferred before the ld. CIT(A), contending that fair market value is less than the value adopted for stamp duty purpose and the Assessing Officer out not have resorted to making the addition u/s.56(2) (vii) of the Act without referring the matter to the Department Valuation Officer. However, the ld. CIT(A) dismissed the appeal.

ITA No.3153/2018 :- 4 -:

Therefore the only course of action open to the Assessing Officer is to refer the matter to the Department Valuation Officer for the purpose of determining the fair market value. Therefore we remit the matter back to the file of the Assessing Officer for denovo assessment by adopting the value determined by the Department Valuation Officer. In the circumstances, the appeal filed by the assessee is partly allowed for statistical purposes.

In the result, the appeal of the assessee is partly allowed 6. for statistical purpose.

Order pronounced on 9th day of July, 2019, at Chennai.