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Income Tax Appellate Tribunal, “C” BENCH: KOLKATA
Before: Shri Mahavir Singh, JM & Shri M. Balaganesh, AM]
ORDER Per Shri Mahavir Singh, JM:
These cross appeals by assessee and revenue are arising out of order of CIT(A)-Siligur in appeal no. 53/CIT(A)/Slg.2011-12 dated 30.11.2012. Assessment was framed by ITO, Ward-2(3), Siliguri u/s. 143(3) of the Income-tax Act, 1961 (hereinafter referred to as “the Act”) for AY 2009-10 vide its order dated Nil.
At the outset, Ld. Counsel for the assessee drew our attention to additional ground filed by assessee, which reads as under: “1) That the Ld.CIT(A) as well as the A.O erred in making addition for the value of the property during the relevant Asst. Year 2009-10. Firstly, the addition is based on mere suspicion only and not based on any material. Secondly, the property was purchased on 18.09.2007 with full purchase value payment relevant to Asst. Year 2008-09. The said purchased property was leased out vide agreement for lease deed tlt.25.10.2007 relevant to Asst. Year 2008-09 and the property was registered by way of conveyance deed on 03.09.2009 relevant to the Asst. Year 2010-11. No payment or any transaction relating to the acquisition of property during the Asst. Year 2009-10. Hence, addition made during the relevant asst. year is completely unjustified & wrong.”
On query from the bench, Ld. Counsel for the assessee stated that the additional ground raised by assessee goes to the very root of the case being jurisdictional
2 & 243/Kol/2013 Seema Agarwal AY 2009-10 issue. Ld. Counsel for the assessee relied on the decision of Hon’ble Supreme Court in the case of NTPC 229 ITR 283 (SC) for admission of additional ground. When this was put to Ld. Sr. DR, he has not objected to the admission of additional ground. We find that the additional ground of appeal raised by the assessee for the first time, because as per the decision of the Hon’ble Supreme Court in the case of NTPC Ltd. 229 ITR 283 (SC) additional ground raised for the first time before Tribunal can be admitted provided the facts necessary for adjudication of the additional ground are available on record. In the present case before us the issue is purely of jurisdictional nature and facts are available on record, hence, we admit this ground and adjudicate the same. From the above additional ground, the question arises is reframed as under: “Whether or not the addition for undisclosed investment in purchase of property by assessee u/s. 69B of the Act is to be made in the previous year 2007-08 relevant to this AY 2008-09 in the given facts and circumstances of the case.”
3. Briefly stated and admitted facts are that the assessee made investment to the tune of Rs.15 lacs for purchase of commercial premises i.e. Unit No. 112A in ABW Towers, IFFCO Chowk, M. G. Road, Gurgaon. The super built up area of this unit is approximately 500 sft and covered area is approximately 300 sft. The assessee made total payment of Rs.15 lacs vide cheque no. 930151 dated 28.09.2007 drawn on Oriental Bank of Commerce to Jassum Propcon Projects Pvt. Ltd. Even the allotment letter was issued by Jassum Propcon Projects Pvt. Ltd. in the name of the assessee vide allotment letter dated 18.09.2007 and also issued receipt of an amount of Rs.15 lacs vide receipt dated 28.09.2007 towards payment for sale consideration against the above stated premises. The terms and conditions of the allotment letter also reveal that the assessee’s payment plan is down payment which means that the entire purchase consideration was paid at the stage of allotment itself. Even from the copy of bank account No. 00682010007630 of Oriental Bank of Commerce, Sirsa City, Thana Road Branch reveals that this cheque no. 93051 dated 18.09.2007 amounting to Rs. 15 lacs was cleared from the bank account on 21.09.2007. As per letter addressed to AO dated 06.09.2012 it is clarified that the assessee has purchased unit no. 112A in ABW Towers, IFFCO Chowk, M. G. Road, Gurgaon through DGS Realtors Pvt. Ltd. Jassum Propcon Projects Pvt. Ltd. also confirmed
3 & 243/Kol/2013 Seema Agarwal AY 2009-10 that an amount of Rs.15 lacs received vide cheque no. 930151 dated 18.09.2007 was the total sale consideration of Unit No. 112A in ABW Towers, IFFCO Chowk, M. G. Road, Gurgaon and the same was adjusted against the sale consideration as full and final payment at the time of registration of conveyance deed. The letter of Jassum Propcon Projects Pvt. Ltd. was written to clarify the fact of receipt of advance amounting to Rs.15 lacs to its earlier letter dated 21.11.2011 addressed to the AO in response to information sought u/s. 133(6) of the Act. The assessee also submitted copy of conveyance/sale deed and as per this sale deed the same was executed on 03.09.2009 mentioned the transaction value at Rs.15 lacs with details of payment already made above. According to the sale deed, the assessee got possession of the property only on 03.09.2009 i.e. on the date of registration of sale deed. As per the conveyance deed the market value of the property as per sub- registrar circle rate is to the tune of Rs.26,02,608/- for the purpose of computation of stamp duty as on 03.09.2009. However, one fact here is to be noted that the assessee has earned assured return on this property from the date of booking i.e. of space from 18.09.2007 was @ 60000/- per month and assessee has disclosed this as rental income and AO has also assessed the same. But the AO after doing investigation on the basis of Inter-net research and taking market rate for property dealers and also taking a formula of minimum real estate returns of investment @ 10-12% estimated the purchase price at Rs.72 lac by observing as under: “An open inquiry into the operation of real estate dealers was made from public domains on the internet wherein real estate sites various number of advertisement identical to the arrangement between DGS Realtors and the assessee can easily be identified. Two of these are marked as annexure A&B. These read as follows: (Annexure A) “Office space with 5 yrs guarantee return/investment in real estate: Appreciation, Rental return & tension free income…:Company profile: ABW Group: 25 yr Builder Co already delivered world class projects…. Including ABW Tower. Invest Rs. 1 crore earn monthly rental Rs.88000/- area 1750 sf ft. ….. Invest Rs.77.15 lakh earn monthly rental Rs.67500/- …. Invest Rs.50 lakh monthly rental Rs.44000/- area 875 sq. ft” (Annexure B): … Property type – office space, area = 500 sq. ft. floor = 5th floor, price/deposit= Rs.3500000/-, Description: Get Rs.34000/- per month rent on 35 lacs office space (Approx 12% Assured return) prime location by reputed builder ABW Ltd. From the above circumstantial evidence it is easily ascertainable that the minimum real estate return is about 10-12% of the investment. Therefore in the case of the assessee the actual investment made in premises 112A the monthly assured return being Rs60000/- is ascertained at Rs.72,00,000/-.”
Aggrieved, assessee preferred appeal before CIT(A).
The CIT(A) after going through the facts and circumstances of the case restricted the cost of acquisition and amount invested by the assessee in this commercial premises at Rs.26,02,608/- being the assessable value and thereby restricted the undisclosed investment at Rs.11,02,608/- after allowing the amount invested by the assessee at Rs.15 lac as explained. Aggrieved, assessee as well as revenue both came in cross appeals.
We have heard rival submissions and gone through facts and circumstances of the case. Before us assessee filed following documents: (i) Copy of letter from Jassum Propcon Projects Pvt. Ltd. Dt. 06.09.2012 against notice u/s. 133(6) of I. T. Act, 1961. (ii) Copy of Receipt Rs.15 lacs received from Sm. Seema Agarwal through cheque against sale of commercial space No. 112, ABW Towers, IFFCO Chowk, Gurgaon. (iii) Copy of allotment letter of Jassum Propcon Projects Pvt. Ltd. allotting commercial space to Sm. Seema Agarwal. (iv) Copy of sale deed in respect to commercial space No. 112 dated 03.09.2009. (v) Copy of lease deed dated 25.10.2007 between Sm. Seema Agarwal and DGS Realtors Pvt. Ltd. The assessee before us stated that these documents were available before the AO as well as before CIT(A). On query from the Bench the Ld. Sr. DR could not controvert the statement of Ld. counsel for the assessee. From the above facts and circumstances it is clear that the assessee has made investment of Rs.15 lac in purchase of commercial space as noted above and this unit is approximately 300 sq. ft. covered area. The assessee purchased this commercial space on 28.09.2007 by making total payment of Rs.15 lac i.e. down payment. Even the allotment letter was issued by Jassum Propcon Projects Pvt. Ltd. is dated 18.09.2007. This property was under construction and project was coming up. No possession was handed over to the assessee because no property was in existence except land. Finally, the sale deed was registered on 03.09.2009 and transaction value executed was declared at Rs.15 lac and as per circle rate the value assessed by sub-registrar was at Rs.26,02,608/-. But now the question arises that in which year the property is to be assessed? In our view, the property is to be assessed either in assessment year 2008-09 relevant FY 2007-08 when the property was booked for a sum of Rs.15 lac
5 & 243/Kol/2013 Seema Agarwal AY 2009-10 or in the year when the sale deed was registered in the assessment year 2010-11 relevant to FY 2009-10 because the date of registration of sale deed was 03.09.2009. In any case the property is not registered in the relevant AY 2009-10. Accordingly, the additional ground raised by assessee is decided in her favour and against revenue. Hence, assessment framed by AO of undisclosed investment u/s. 69B of the Act is quashed and this issue of assessee’s appeal is allowed.
6. Since we have allowed the jurisdictional issue of assessee, we need not to adjudicate the issues raised by revenue in its appeal and that of the appeal of the assessee.
7. In the result, the appeal of the assessee is allowed and that the revenue is dismissed. 8 Order is pronounced in the open court on 07.10.2015 Sd/- Sd/- (M. Balaganesh) (Mahavir Singh) Accountant Member Judicial Member
Dated : 7th October, 2015 Jd. Sr. P.S Copy of the order forwarded to: