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Appellate Tribunal Upholds CIT(A) Decision on Inherited Property Claim The appellate tribunal upheld the decision of the CIT(A) to allow the assessee's claim of &8377; 2,85,42,477/- under section 56(2)(vii) of the Income ...
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Appellate Tribunal Upholds CIT(A) Decision on Inherited Property Claim
The appellate tribunal upheld the decision of the CIT(A) to allow the assessee's claim of &8377; 2,85,42,477/- under section 56(2)(vii) of the Income Tax Act. The property in question was not considered a fresh purchase but inherited by the appellant, leading to the deletion of the addition under the Act. The tribunal found the CIT(A)'s decision well-founded and dismissed the revenue's appeal on a formal issue, pronouncing judgment on 31/05/2021.
Issues: 1. Allowance of claim of &8377; 2,85,42,477/- u/s 56(2)(vii) of I.T.Act. 2. Challenge to the CIT(A) decision on the above claim.
Analysis:
Issue 1 and 2: The revenue contested the CIT(A)'s decision to allow the assessee's claim of &8377; 2,85,42,477/- under section 56(2)(vii) of the Income Tax Act. The CIT(A) based the decision on the property being purchased by the assessee's father in 1974, with full payment made to the vendors and original owners. Possession was transferred to the father, supported by confirmations and a Power of Attorney. The property was inherited by the appellant and other legal heirs. Payments made by the appellant were for settlement, not purchase consideration, as the property already belonged to the family. The registration in the appellant's name in 2014-15 was due to a settlement, not a new purchase. Stamp duty was paid based on the ready reckoner value. The CIT(A) concluded that the property was not a fresh purchase, hence deleting the addition under section 56(2)(vii)(b) of the Act. The appellate tribunal upheld the CIT(A)'s decision, finding it well-founded and not subject to interference.
Issue 3: Issue 3 was deemed formal and did not require adjudication. The appeal of the revenue was consequently dismissed. The judgment was pronounced openly on 31/05/2021.
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