Property purchase stamp duty valuation date dispute u/s56(2)(vii)(b) sent back for cheque-payment verification

Whether addition under s.56(2)(vii)(b) could be computed with reference to stamp duty value on the alleged agreement date turned on proof that the first payment was made on 18.02.2013, thereby fixing the relevant valuation date. As the sale deed was not produced and the cheque payment could not be verified from the record, the Tribunal held that the factual foundation was incomplete. The matter was set aside to the AO to verify the cheque payment through the sale deed or other admissible evidence produced by the assessee; if proved, the AO must adopt the stamp duty value as on 18.02.2013 for determining deemed income. The appeal was allowed for statistical purposes.

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1. ISSUES PRESENTED AND CONSIDERED

1) Whether, for computing deemed income under section 56(2)(vii)(b) on purchase of immovable property, the stamp duty value as on the date of agreement must be adopted (instead of the date of registration) when the assessee claims an earlier agreement and earlier part-payment through banking channels.

2) Whether the assessee discharged the evidentiary burden to establish an agreement/understanding and banking payment allegedly made on 18.02.2013 so as to trigger application of the proviso to section 56(2)(vii)(b), and what consequential direction should follow.

2. ISSUE-WISE DETAILED ANALYSIS

Issue 1: Adoption of stamp duty value as on date of agreement under section 56(2)(vii)(b) proviso

Legal framework (as discussed by the Tribunal): The Tribunal noted that section 56(2)(vii)(b) was applied by the Assessing Officer to treat the excess of stamp duty value over consideration as income. The Tribunal also examined the proviso to section 56(2)(vii)(b), which stipulates that where the date of agreement fixing the consideration and the date of registration are not the same, the stamp duty value as on the date of agreement should be taken for purposes of computing income under section 56(2)(vii)(b).

Interpretation and reasoning: The Tribunal accepted, as a matter of principle, that if there exists a qualifying earlier "date of agreement" (in the sense contemplated by the proviso) distinct from the registration date, then the stamp duty value on that agreement date is relevant for computing the deemed income. The Tribunal treated the assessee's case as hinging on proof that the purchase arrangement stood fixed on 18.02.2013, supported by a cheque payment on that date, with later payments and a subsequent formal agreement.

Conclusion: The Tribunal held that the proviso would apply and the stamp duty value as on 18.02.2013 should be adopted if the assessee's contention regarding the first cheque payment (and corresponding earlier purchase arrangement) is verified as correct by the Assessing Officer.

Issue 2: Sufficiency of evidence for claimed earlier agreement/payment and appropriate relief

Legal framework (as discussed by the Tribunal): The Tribunal evaluated whether the factual foundation for invoking the proviso was established on record, focusing on documentary verification of the alleged banking payment and the purchase documents (including the sale deed).

Interpretation and reasoning: The Tribunal noted the Revenue's objection that no agreement dated 18.02.2013 was brought on record. It further recorded that the assessee asserted an oral agreement and claimed payments from 18.02.2013 to 30.06.2017, followed by a formal agreement dated 23.11.2017. However, the Tribunal found that no evidence of the alleged cheque payment of Rs. 1,00,000 on 18.02.2013 had been produced, and the sale deed was also not filed to enable verification. Given this evidentiary gap, the Tribunal determined that the matter required factual verification rather than confirmation of the addition on the existing record.

Conclusion: The Tribunal set aside the matter to the jurisdictional Assessing Officer with directions: (i) to verify the alleged cheque payment dated 18.02.2013 to the seller from the sale deed or other evidence produced; (ii) the assessee must produce evidence of such payment and provide further documents/clarifications as required; and (iii) if the payment claim is found correct, the Assessing Officer must adopt the stamp duty value as on 18.02.2013 to recompute deemed income under section 56(2)(vii)(b). The appeal was allowed for statistical purposes in view of the remand.

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