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of <h1>Court affirms addition for unexplained investment based on fair market value. Revenue prevails.</h1> <h3>Smt. Amar Kumari Surana Versus Commissioner Of Income-Tax</h3> Smt. Amar Kumari Surana Versus Commissioner Of Income-Tax - [1997] 226 ITR 344, 134 CTR 313, 89 TAXMANN 544 Issues Involved:1. Computation of undisclosed investment based on fair market value u/s 55A.2. Justification of considering Rs. 23,400 as unexplained investment u/s 69B.Summary:Issue 1: Computation of Undisclosed Investment Based on Fair Market Value u/s 55AThe assessee purchased a plot of land for Rs. 45,000, but the Income-tax Officer (ITO) determined the fair market value to be Rs. 81,000 based on a valuer's report. The ITO issued a notice to the assessee to explain the discrepancy, suggesting that Rs. 36,000 was an undisclosed investment. The Appellate Assistant Commissioner reduced this figure to Rs. 23,400, and the Tribunal upheld this decision. The Tribunal's finding was based on the valuation report and the lack of any satisfactory explanation from the assessee.Issue 2: Justification of Considering Rs. 23,400 as Unexplained Investment u/s 69BThe ITO added Rs. 36,000 to the assessee's income u/s 69B, which was later reduced to Rs. 23,400 by the Appellate Assistant Commissioner. The Tribunal confirmed this addition, noting that the assessee failed to justify why the plot was purchased at a rate significantly lower than the market value. The court emphasized that while fair market value alone cannot justify an addition u/s 69B, the burden is on the Revenue to prove that the actual investment exceeded the recorded amount. The Tribunal found sufficient material to draw a reasonable inference of undisclosed investment.Conclusion:The court upheld the Tribunal's decision, affirming that the addition of Rs. 23,400 as unexplained investment was justified. The questions were answered in the affirmative, in favor of the Revenue and against the assessee.
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