RINKI SINGH ,JAMSHEDPUR TELCO vs. ITO WARD 2(1) JAMSHEDPUR, JAMSHEDPUR
Facts
The assessee purchased a flat on 13/03/2018 for ₹10,45,000, while the stamp duty value was ₹31,56,500. The Assessing Officer (AO) added the difference under Section 56(2)(x) of the Income-tax Act, 1961. The assessee argued that the agreement for sale was made in 2010, before Section 56(2)(x) was introduced.
Held
The Tribunal held that the agreement for sale was executed in 2010, prior to the introduction of Section 56(2)(x). Therefore, the addition made by the AO and confirmed by the CIT(A) under this section was not sustainable, despite the sale deed being registered in 2018. The CIT(A) had dismissed the appeal on technical grounds.
Key Issues
Whether the addition under Section 56(2)(x) is valid when the original agreement for sale was executed before the introduction of the section, even though the sale deed was registered later? Whether the dismissal of appeal by CIT(A) on technical grounds was justified?
Sections Cited
147, 144B, 270A, 142(1), 56(2)(x), 249(4)(b), 148
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, RANCHI BENCH, RANCHI
Before: SHRI GEORGE MATHAN & SHRI RATNESH NANDAN SAHAY
PER: RATNESH NANDAN SAHAY, A.M.
This appeal by the assessee is directed against the order of the National
Faceless Appeal Centre (NFAC), Delhi/learned Commissioner of Income Tax
(Appeals), [in short, the ld. CIT(A)] dated 28/12/2024 for the Assessment Year
(AY) 2018-19. The assessee has raised following grounds of appeal:
"It is therefore, prayed that your honor be graciously may kindly pass an order to set aside the order passed by Assessing Officer under Section 147 read with 144B of the Income-tax Act, 1961 (the Act), stay of recovery disputed amount a sum of ₹ 9,51,594.00 and set aside penalty proceeding initiated by the Assessing Officer under Section 270A of the Income-tax Act, 1961 (the Act), 1961 and for this Act of your kindness your petitioner shall ever or may kindly pass order for reassessment by the learned ITO."
Facts of the case are that the assessment under Section 147 read with section
144B of the Income Tax Act, 1961 (in short, the Act) was passed on
30/03/2023 on a total income of ₹ 23,56,250/- in which addition of
ITA No. 56/Ran/2025 Rinki Singh Vs ITO
₹ 21,11,500/- was added under Section 56(2)(x) of the Act on the ground that
the property being Flat No. B/2, 2nd Floor, Sai Heritage, Block No. 2,
Ghorabandha Telco, Jamshedpur, East Singhbhum was purchased on
13/03/2018 vide sale deed No. 1026 dated 13/03/2018 for a consideration of
₹ 10,45,000/- whereas the stamp value of the property was declared at
₹ 31,56,500/-.
Aggrieved by the order of the Assessing Officer, the assessee filed appeal
before the ld. CIT(A), who vide the impugned order, dismissed the appeal on
the ground that the assessee has failed to make payment of amount equal to
the advance tax which was due on its income as per the information given at
serial No. 9 of Form No. 35 as provided in clause (b) of sub-section (4) of
Section 249 of the Act. Since the appellant has filed a belated return and not
paid the advance tax, the appeal is liable to be dismissed.
Aggrieved by the order of the ld. CIT(A), this appeal has been filed by the
assessee before this Tribunal.
No one has appeared on behalf of the assessee, the ld. Sr.DR has appeared on
behalf of the revenue.
The ld. Sr.DR for the revenue has supported the orders of the lower
authorities.
We have considered the submissions of the appellant as given in response to
the notice issued by the Assessing Officer under Section 142(1) of the Act
dated 15/11/2022 and has been discussed on page No. 2 and 3 of the
assessment order, which reads as under:
ITA No. 56/Ran/2025 Rinki Singh Vs ITO
"That I am a housewife and partly earning income from teaching profession and my husband Mr. Rupesh Kumar Singh is working in Govt of Jharkhand under police department since 13th May 2005 having pan is BTAPS8407B. That I had furnished information of your dated 14th day of March-2022 and I am again furnishing the information as you asked to furnish to me in respect of purchase of flat No B/2 in the Anjanji Homes Sai Heritage, at Ghorabandha Telco Jamshedpur East Singhbhum on dated 18.03.2018 as under- "Your information is quite right that I have purchased a flat No. B/2 in the Anjanji Homes Sai Heritage. at Ghorabaridhe Telco Jamshedpur East Singhbhum which registration has done in the office of the Sub-Registrar Jamshedpur on dated 18.03.2018 vide deed no 1026 for actual consideration amount of RS. 10,45 000.00 (Rs. Ten Lakh Forty Five Thousand Only) and which stamp duly valued of Rs 31,56,500.00 (Rs Thirty One Lakh Fifty Six Thousand Five Hundred Only)." "That under section 56(2) (X) of the It Act will not be applicable me this flat was booked by my husband Mr. Rupesh Kumar Singh under his name with Anjani Homes on dated 4th Day of March-2010 by executing an agreement with M/S Anjani Homes builder/developer for total consideration of Rs. 10,45,000.00 (Rs. Ten Lakh Forty Five Thousand Only) out this Rs.847000.00 (Rs. Eight Lakh Forty Seven Thousand was financed by SBI on dated 04-12-2010 and almost payment was made to the builder and the builder has already given to us possession of the flat but registration has been done on dated 18.03.2018 in my name only to get the benefits of the stamp duty Of Rs.1.. (One only) as under the resolution of Jharkhand Government Circular to Revenue Registration and land reforms department as per Letter No 499 & 500 of dated 19/06/2017. "That I do have part-time income from teaching services and the same was under nil category yes I have filed It Return as per your notice for AY 2018-19. "That this flat was booked by my husband Mr. Rupesh Kumar Singh under his name with Anjani Homes on dated 4th Day of March-2010 by executing an agreement with M/S Anjani Homes builder/developer for total consideration amount of Rs. 10.45,000.00 (Rs. Ten Lakh Forty Five Thousand Only) out this Rs.847000.00 (Rs. Eight Lakh Forty Seven Thousand was financed by SBI on dated 04-12-2010 and almost payment was made to the builder and the builder has already given to us possession of the flat but registration has been done on
ITA No. 56/Ran/2025 Rinki Singh Vs ITO
dated 18.03.2018 in my name only to get the benefits of the stamp duty Of Rs.1.. (One only) in the case of female owner of the property as under the resolution of Jharkhand Government Circular to Revenue Registration and land reforms department as per their Letter ref No 499 & 500 of dated 19/06/2017. "Since this flat was purchased by my husband Mr. Rupesh Kumar Singh who's source income is from salary from Govt Of Jharkhand and the balance amount of Rs. 847000.00 (Rs. Eight Lakh Forty Seven Thousand was financed by SBI on dated 04-12-2010 against total purchase cost of the flat of Rs. 10,45,000.00 (Rs. Ten Lakh Forty Five Thousand Only) ( A Xerox copy of Agreement copy, I card of My husband and SB1 Sanction letter enclosed for your ready references."
Though, the ld. CIT(A) has dismissed the appeal on technical ground that the
assessee was required to file the returns of income in response to notice under
Section 148 of the Act and was also required to pay the advance tax as per the
provisions of Section 249 of the Act, we are of the considered view that the
agreement for sale of flat was reached between the assessee's husband and
the seller way back on 04/12/2010 and the provisions of Section 56(2)(x) of
the Act was not there in the Statute at the time of agreement for sale and
therefore, the assessee had rightly made a request to the Assessing Officer
that this case is not covered under Section 56(2)(x) of the Act and therefore,
no notice under Section 148 was required to be issued to the assessee and no
tax was payable by the assessee. The ld. CIT(A), however, missed that point
and dismissed the appeal on technical ground. We find merit in the submission
of the assessee that since the original agreement was passed way back in
2010, the provisions of Section 56(2)(x) of the Act cannot be applied in this
case despite the fact that sale deed was registered on 18/03/2018.
ITA No. 56/Ran/2025 Rinki Singh Vs ITO
Accordingly, the addition made by the Assessing Officer and confirmed by the
ld. CIT(A) is deleted and the appeal of the assessee is allowed.
In the result, this appeal of the assessee is allowed.
Order pronounced in open court on 5 March , 2026
Sd/- Sd/- (GEORGE MATHAN) (RATNESH NANDAN SAHAY) JUDICIAL MEMBER ACCOUNTANT MEMBER
Ranchi, Dated: 05/03/2026 *Ranjan Copy to: 1. Assessee 2. Revenue 3. CIT 4. DR By order 5. Guard File
Sr. Private Secretary, ITAT, Ranchi
