MAHESH VASANT GHARE,MUMBAI vs. INCOME TAX OFFICER WARD 24(2)(1), MUMBAI, PIRAMAL CHAMBER, LAL BAUG. MUMBAI

The solitatry grievance of the assessee is that the learned CIT(A) erred in confirming the addition of Rs.24,34,500/- being the difference between Stamp Duty Valuation (SDV) and purchase consideration.

Briefly stated the facts of the case are that the return of income of the assessee was selected for scrutiny assessment through CASS on the information that during the year under consideration the assessee has purchased immovable property of Rs.81,00,000/- whereas the stamp duty paid was of Rs.1,29,69,000/-. The notice u/s 142(1) of the Act was issued to the assessee who was asked to explain the difference amount of Rs.48.69 lakhs in the stamp duty valuation and the purchase consideration and why the same should not be taken as income from other soures u/s 56(2)(vii)(b) of the Act. On receiving no plausible reply, and on finding that the said property was purchased by the assessee jointly with his wife and the share of the assessee being 50%, the AO made the addition of Rs.24,34,500/- being 50% of the impugned difference.

The assessee agitated before the learned CIT(A) but without any success. The contention of the assessee was that the matter should have been referred to the DVO. The learned CIT(A) did not accept this contention of the assessee as the request for the reference to the DVO was never made before the AO. Though, the request was made before the learned CIT(A) but the CIT(A) did not refer the matter to the DVO but confirmed the assessment. Before us, the counsel for the assessee pointed out that the matter was referred to the DVO in the case of wife of the assessee but since the assessment was getting barred by limitation, the AO did not wait for the report and made the impugned addition.