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Facts
The assessee purchased a property for Rs. 3,620,000, while the stamp duty value was Rs. 17,718,500. The Assessing Officer (AO) added the difference of Rs. 14,098,500 to the assessee's income under Section 56(2)(x)(b). The assessee claimed the allotment date of 13/04/2007, with an advance payment of Rs. 5 lakhs on 01/07/2006, should be considered for stamp duty valuation.
Held
The Tribunal found that the CIT(A) had not considered the merits of the case, merely upholding the AO's order due to the assessee's failure to respond to notices. In the interest of natural justice, the matter was restored to the CIT(A) for a fresh adjudication.
Key Issues
Whether the date of acquisition of property should be considered based on the initial allotment letter and advance payment, or based on a later agreement for sale for the purpose of Section 56(2)(x)(b).
Sections Cited
143(3), 144B, 56(2)(x)(b), 143(2), 142(1), 250(6)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “D” BENCH, MUMBAI
Before: SHRI PRASHANT MAHARISHI, AM & SHRI RAHUL CHAUDHARY, JM Smt. Arati Vissanji, AR
This appeal is filed by Mr. Rajkumar Anandchand Jain (the assessee/appellant) against the appellate order passed by National Faceless Appeal Centre, Delhi (the learned CIT – A) for assessment year 2018 – 19 on 10/8/2023 wherein the appeal filed by the assessee against the assessment order passed under section 143 (3) read with section 144B of The Income Tax Act, 1961 (The Act) dated 20/4/2021 by the National e-Assessment Centre, Delhi (the learned AO) was dismissed relying on the decision of the honourable Supreme Court in case of B N Bhattacharjee 118 ITR 461 upholding the action of the learned assessing
The assessee is aggrieved with that appellate order and has preferred appeal before us raising following grounds of appeal:-
The learned Commissioner of income tax appeal erred in making an addition of Rs 14,098,500 under section 56 (2) (x) (b) details of which are as under:-
Relevant sections issue 56 (2) (x) (b) Addition of Rs. 1,40,98,500 under section 56 (2) (x) (b) Ground of appeal
Agreement Value as per stem Value considered Difference amount value duty authority is by the learned added as income assessing officer under section 56 (2) (x) (b)
36,20,000 1,77,18,500 1,77,18,500 1,40,98,500
The appellant craves leave to add, alter, vary, omit, substitute, or amend the grounds of appeal at any time before or at the time of hearing of the appeal to enable to the learned Commissioner (appeals) to decide the appeal according to law.
Brief facts of the case shows that assessee is an individual who filed his return of income on 31/10/2018 at a total income of Rs. 5,225,180/– . On 13/2/2019, the return
Assessee has purchased the property for Rs. 3,620,000 values of which for stamp duty purposes Rs. 17,718,500 and therefore there is a difference of Rs. 14,098,500/- which was required to be taxed in the hands of the assessee.
The claim of the assessee is that assessee has purchased the property on 13/4/2007 wherein allotment letter issued by the builder stated that assessee has purchased a commercial property in project ‘Druan Height’. According to that letter, the assessee has paid an advance of Rs. 5 lakhs on 1/7/2006 to the builder. The builder has also given a confirmation by letter dated 9/2/2021 where the name of the project has changed to ‘Grand Sethia’ now residential property. Therefore, the claim of the assessee is that stamp duty value may be considered as on 1/7/2016, which is the date of allotment of the flat coupled with payment of consideration also. The learned assessing officer noted that in the allotment letter dated 13/4/2007 the property was not identified as well as full value of the consideration was not stated therein and therefore same cannot be taken for the purpose of date of
Assessee aggrieved with that preferred an appeal before the learned CIT – A. Assessee was issued notices on 15/11/2022, 18/7/2023 and final opportunity was given on 25/7/2023 requesting the assessee to file the submission by 1/8/2023 which assessee failed and therefore the learned CIT – A noted that assessee does not want to effectively pursue it. Accordingly, as nothing was produced before him, he decided the issue on the merits of the case and upheld the assessment order of the learned assessing officer assessing the income at Rs 19,923,680/– wherein the addition of Rs 14,098,500 is confirmed. Thus, assessee is aggrieved and in appeal before us.
The learned departmental representative vehemently submitted that assessee has failed to respond to the any of the notices issued by the learned CIT – A and therefore the learned CIT – A did not have any other option but to decide the issue on the merits of the case wherein he has upheld the action of the learned assessing officer and therefore there is no infirmity in the order of the learned CIT – A.
We have carefully considered the rival contention and perused the orders of the lower authorities. The only dispute in this appeal is whether the date of acquisition of the property should be considered by the letter dated 13/4/2007 wherein the assessee has demonstrated that he has paid a sum of Rs 5 lakhs for booking of the commercial property. The learned assessing officer has disregarded this argument for the reason that the letter
In the result, appeal filed by the assessee is allowed for statistical purposes.
Order pronounced in the open court on 05.01.2024.