Section 56(2)(x) and mortgage-linked registration of an allotted flat require evidence of fresh receipt before any addition can stand.

Section 56(2)(x) does not apply merely because an already allotted under-construction flat is later registered to create a mortgage in favour of a lender, unless the transaction amounts to a fresh receipt of immovable property for inadequate consideration. The text notes that the assessee had pre-existing allotment rights, had substantially paid the consideration, and the later registration was said to secure a bank loan rather than transfer any new property interest. However, the record lacked detailed scrutiny of the mortgage papers, allotment letter, payment schedule, and related evidence. The addition based on stamp duty valuation was therefore not finally sustained and the matter was restored for fresh verification and de novo adjudication.

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Issues: Whether section 56(2)(x) of the Income-tax Act, 1961 applied to the registration of an already allotted under-construction flat undertaken only to facilitate a mortgage loan, and whether the addition based on the stamp duty valuation could be sustained without examining the mortgage and allotment ils.

Analysis: The assessee had acquired rights in the flat upon allotment, substantially paid the consideration, and possession was delivered much later. The registration during the relevant year was stated to be for creating a mortgage in favour of a bank against pre-existing rights, not for acquiring any fresh immovable property. The deeming provision in section 56(2)(x) applies where immovable property is received for inadequate consideration. On the record as it stood, a mere registration linked to mortgage financing did not prima facie amount to a fresh receipt of property. However, the assessment and appellate orders did not contain a detailed examination of the mortgage documents, loan papers, allotment letter, payment schedule, and other contemporaneous evidence necessary to ascertain the true nature of the transaction.

Conclusion: The matter required fresh verification by the Assessing Officer, and the addition was not finally sustained at this stage. The impugned order was set aside and the issue was restored for de novo adjudication after examining the relevant evidence, with an opportunity of hearing to the assessee.

Ratio Decidendi: Section 56(2)(x) cannot be invoked merely because an already allotted property is later registered for creating security in favour of a lender, unless the transaction results in a fresh receipt of immovable property for inadequate consideration.

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