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Facts
The assessee, a private limited company, purchased agricultural land and paid stamp duty. The AO observed that the stamp value authority treated the property as residential and made an addition of the differential value by invoking Section 56(2)(x)(b) of the Act, along with an ad-hoc disallowance of expenses.
Held
The Tribunal noted the assessee's claim that the stamp duty was wrongly charged at a higher rate by treating agricultural land as residential, and that Section 56(2)(x)(b) was not applicable given the land area. It was also observed that the stamp authorities did not consider these aspects or conduct verification.
Key Issues
Whether the addition of the differential value of the property, based on treating agricultural land as residential for stamp duty purposes, is justified under Section 56(2)(x)(b) of the Act?
Sections Cited
56(2)(x)(b)
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Income Tax Appellate Tribunal, DELHI
Before: SHRI YOGESH KUMAR U.S. & SHRI MANISH AGARWAL
ORDER
PER MANISHAGARWALAM:
The present appeal is filed by the assessee against the order of Ld. Commissioner of Income Tax (Appeals/ National Faceless Appeal Centre (‘Ld. CIT(A)/NFAC’ for short), Noida dated 30.09.2024 for the Assessment Year 2021-22 arising out of the order of the Assessing Officer vide order dated 27.12.2022 pertaining to A.Y. 2021-22.
Brief facts of the case are that the assessee is a Private Ltd. Company, engaged in manufacturing and trading activities of White Paper (Writing & Printing) and Kraft Paper. During the year under appeal assessee had purchased agricultural land for Rs. 16,57,500/- and paid the stamp duty of 3,28,000/-. Th AO observed that as per the registered sale deed the stamp value authority had valued the said property at Rs. 46,72,000/- by treating the same as residential and thus made the addition of the differential value of Rs.30,14,500/- by invoking the provisions of section 56(2)(x)(b) of the Act. Besides this adhoc disallowance of Rs. 5.00 lacs was also made out of various expenses.
Aggrieved by the order of the Assessing Officer, the assessee is in appeal before CIT(A). The CIT(A) partly allowed the appeal of the assessee and upheld the addition of Rs. 30.14,500/- made u.s 56(2)(x)(b) of the Act.
Aggrieved by the order of the CIT(A), the assessee is in appeal before us.
The ld. AR for the assessee has moved an application for adjournment but adjournment application is rejected.
Learned authorized representative for Department of assessee submitted that ld. CIT(A) has reasoned order. He also submitted that the addition was rightly sustained by ld. CIT(A) which order deserves to be sustained.
We have heard the parties and perused the material available on record. Claim of the assessee was that assessee had purchased agricultural land and the stamp duty was wrongly charged at the higher rate by treating the same as residential which is not correct. It was further claimed that the provisions of section 56(2)(x)(b) are not applicable to the agricultural land purchased by the assessee. The higher stamp duty was charged where the land area is between 0.00 to 0.100 hectare however, assessee had purchased more land thus such rule was not applicable and the stamp authorities have mistakenly charged higher duty. These aspects were not considered, nor any verification was done form the stamp value authorities. Thus considering the totality of the facts and circumstances of the case and in the interest of justice, we deem it proper to restore the issue to the file of the Ld. CIT(A) with a direction to consider the submissions of the assessee and make necessary verification of the claim of the assessee and decide the issue as in accordance with law. The assessee is also directed to appear and co- operate in the appellate proceedings. The grounds raised by the assessee are accordingly allowed for statistical purposes.
In the result, the appeal of the assessee is allowed for statistical purposes.
Order pronounced in the open court on 12 September, 2025.