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Cites 3 docs
The Income- Tax Act, 1995
Section 69B in The Income- Tax Act, 1995
Section 69 in The Income- Tax Act, 1995

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Income Tax Appellate Tribunal - Ahmedabad
Madhukanta P.Shah, Ahmedabad vs Department Of Income Tax on 1 October, 2013
                    "B" BENCH, AHMEDABAD


                           ITA No.3328/Ahd/2010
                               A.Y. 2007-08

         The Income Tax                Vs Smt. Madhukanta P.
         Officer, Ward-6(2),              Shah.
         Ahmedabad.                       10, Devanshah
                                          Bunglows, Drive-in,
                                          Road, Thaltej

                                            PAN: ACUPS 1876Q
                 (Appellant)                  (Respondent)

                Revenue by :          Shri P. L. Kureel, Sr.D.R.,
               Assessee(s) by :       None

          सुनवाई कᳱ तारीख/ Date of Hearing     : 01/10/2013
          घोषणा कᳱ तारीख /Date of Pronouncement:  4/10/2013

                               आदेश/O R D E R


      This is an appeal filed by the Revenue arising from the order of
learned CIT(A)-XI, Ahmedabad, dated 12.10.2010. The Revenue has
raised the following grounds:
      "The Ld. Commissioner of Income Tax(A) has erred in law and on facts in
      deleting the addition of RS.21,83,260/- made u/s.69B of the Act on account of
      unexplained investment in property."

2.    Facts

in brief as emerged from the corresponding assessment order passed u/s. 143(3), dated 29.12.2009 were that the assessee in individual capacity has earned salary income, capital gain and house property income. The AO has received an information according to which it was found that the assessee had purchased an immovable property declared at ITA No.3328/Ahd/2010 ITO Ahmedabad Vs. Smt. Madhukantu P. Shah.

For A.Y. 2007-08 -2- Rs.69,66,540/-. As against that, the property was valued by the Registrar at Rs. 91,49,900/-. The difference between the two, i.e., Rs.21,83,360/- was taxed in the hands of the assessee by invoking the provisions of Section 69B of IT Act. The relevant facts recorded by the AO are reproduced below for the sake of ready reference:

"In this case as per Annual Information Report received from the Sub- Registrar Paldi-4, Ahmedabad, the assessee has purchased immovable property during the F.Y. 2006-07 relevant to the A.Y. 2007-08. Information u/s. 133(6) of the Act was called for from the office of Sub-Registrar Paldi-4, Ahmedabad. On verification of the details submitted by the Sub-Registrar, Paldi-4, Ahmedabad, it was noticed that as per the Order for Valuation of Immovable Property, the Sub-Registrar has given a detailed working of the valuation of the property & valued the said property at Rs.91,49,900/- as against the value declared by the assessee at Rs.69,66,540/- in the purchase deed & levied additional stamp duty of Rs.1,29,870/- as against stamp duty charges of Rs.4,14,550/- paid by the assessee, which has been duly paid by the assessee, which fact is evident since the said sale/purchase deed has been registered by the sub-registrar, Paldi-4, Ahmedabad vide Registration No.3517 dated 24.4.2006 in the name of the assessee. A copy of the registered sale document has also been submitted by the Sub-Registrar, Paldi-4, Ahmedabad ot this office. It is therefore clear that the valuation of the said property by the Sub-Registrar Paldi-4, Ahmedabad at Rs.91,49,990/- has been accepted by the assessee. The assessee has failed to produce any evidence that the value of the property assessed at Rs.9149900/- by the Stamp valuation authority has been disputed in any appeal or revision and no reference has been made by the assessee against the said valuation by the stamp valuation authority before any authority, court or the High Court. The whole scenario gives a picture that the assessee has undervalued the property for the purpose of Income Tax. The value ascertained by the Sub-Registrar is the acceptable value of the property as per the Income Tax Act, and the assessee has thus clearly tried to undervalue the property which in turn has led to underassessment of investment in immovable property of the assessee."

3. When the mater was carried before learned the CIT(A), it was held that the provisions of Section 50C could not be applied on the facts of the case because the assessee has purchased the property instead of sale of property. The relevant paragraphs of learned CIT(A) are reproduced below:

"3. The second ground of appeal is directed against the addition of Rs.21,83,360/- on account of unexplained investment in property under ITA No.3328/Ahd/2010 ITO Ahmedabad Vs. Smt. Madhukantu P. Shah.
For A.Y. 2007-08 -3- Section 69 of the IT Act. It is seen that the appellant had purchased immovable property for a consideration of RS.69,66,540/- and the sub- registrar valued the said property at Rs.91,49,900/- for stamp duty purpose. Therefore, after discussing the issue at length in the assessment order and after referring to the provisions of Section 50C of the Act, the AO made addition of Rs.21,83,360/- (being the difference between the stamp duty valuation and purchase consideration of the said property) u/s.69B of the IT Act, 1961.
3.2 I have considered the submissions made by the A.R. of the appellant and the observation of the assessing officer in the assessment order. The AO has not brought on record any material/evidence to show that the impugned amount was actually paid by the appellant. The contentions put forth by the A.R. of the appellant are tenable. Ahmedabad's Tribunal's decision cited at 38 SOT 486(supra), relied on by the A.R. of the appellant is squarely applicable to the facts of the appellant's case. Having considered the facts and circumstances of the case and in the light of the above decision, I am of the view that the assessing officer is not justified in making addition under Section 69B of the Act. The addition made by the AO at Rs.21,83,360/-."

4. On the date of hearing, no one has appeared from the side of the respondent assessee. The matter being trifle and covered by few orders of this Tribunal, therefore, we have decided to proceed ex-parte qua the assessee after hearing learned DR. Once an admitted factual position is that the amount in question was not the difference on account of sale of the property but undisputedly it was in respect of the purchase of the property, therefore, the provisions of Section 50C of IT Act were wrongly invoked by the AO. We are not inclined to interfere with the findings of learned CIT(A), hence, the same are hereby confirmed and this ground of the Revenue is, therefore, deleted.

5. In the result, the appeal of the Revenue is dismissed.

                Sd/-                                       Sd/-
   (ANIL CHATURVEDI)                               ( MUKUL Kr. SHRAWAT )
  ACCOUNTANT MEMBER                                   JUDICIAL MEMBER
Ahmedabad;             Dated      4/10/2013
Prabhat Kr. Kesarwani, Sr. P.S.
                                     TRUE COPY
                                                         ITA No.3328/Ahd/2010
                                    ITO Ahmedabad Vs. Smt. Madhukantu P. Shah.
                                                             For A.Y. 2007-08

आदेश कᳱ ᮧितिलिप अᮕेिषत/Copy of the Order forwarded           to :
1.   अपीलाथᱮ / The Appellant
2.   ᮧ᭜यथᱮ / The Respondent.
3.   संबंिधत आयकर आयुᲦ / Concerned CIT

4. आयकर आयुᲦ(अपील) / The CIT(A)-III, Ahmedabad

5. िवभागीय ᮧितिनिध, आयकर अपीलीय अिधकरण, अहमदाबाद / DR, ITAT, Ahmedabad

6. गाडᭅ फाईल / Guard file.

आदेशानुसार/ BY ORDER, उप/सहायक पंजीकार (Dy./Asstt.Registrar) आयकर अपीलीय अिधकरण, अहमदाबाद / ITAT, Ahmedabad