TaxTMI 
TaxTMI 
TaxTMI 
2014 (3) TMI 153
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....rcumstances of the case, the ITAT was right in relying on the percentage of profit of the assessee stated in the MOU to hold that the sale price stated therein cannot be adopted ?" Issue pertains to computation of capital gain in the hands of the respondentassessee arising due to sale of land which was sold by the assessee to one Savvy Homes Cooperative Housing Society [Proposed]. As per the Assessing Officer, the sale consideration should have been taken at 14.71 Crores [rounded off] as against Rs. 7.36 Crores [rounded off] reflected in the sale deed. There was also a dispute with respect to the fair market value of the land. As on 1st April 1981, the assessee adopted the figure of Rs. 2,00,95,680/= at the rate of Rs. 800/= per sq. yard. The Assessing Officer, however, adopted the rate of Rs. 250/= per sq. yard. With respect to the discrepancy in the sale consideration, the Assessing Officer relied on the MOU signed between the seller and the purchasers indicating that the land was to be sold at Rs. 12.70 Crores. He discarded the agreement to sale as well as the sale deeds on the ground that the same did not reflect the correct sale consideration. With respect to the fair market....
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....rtners of one part and other part M/s. Savvy Infrastructure Com. Limited. Again on page 8 of the same MOU, it is stated that a token amount given towards sale price by the party on the other part to the first part is to be treated as given to the new partnership firm by the other part. This has increased the confusion as to whether this MOU is for formation of a new partnership firm or it is for sale of land simplicitor. Although only one name is given as party of one part ie., the assessee Shri Govindbhai A. Patel but on page 37 of the paper book, it is stated that "we the party of the one part is exclusively owning, holding, possessing and enjoying and this land is free from encumbrances...". In para 2 of this MOU, it is also agreed that the tenure of this MOU will be 18 months and during this period, installment of equal amount has to be paid at every month. There is nothing brought on record by the Revenue to show that any such monthly installment was paid by the party of 2nd part ie., Shri Chetnaben M. Patel to the assessee. Further, para 10 of the MOU is relevant and the same is reproduced from page 42 to 43 of the paper book for the sake of ready reference : " 11. The said ....
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....o other evidence even circumstantial evidence has been found even in the course of search carried out only 11 days after the date of sale deed to corroborate this allegation that the assessee has received sales consideration in cash of Rs. 735.15 lacs. If this much huge cash was received by the assessee, something must be found in the course of search either unaccounted cash or unaccounted investment or any other papers, etc., which may have indicated such a huge cash transaction. This is also not the case of the Assessing Officer that jantri price of this land in question at the relevant point of time was more than the value declared by the assessee in the sale deed. Hence, we find that neither the value as per jantri rates is more than the sale value declared in the sale deed nor any other evidence was found suggesting receipt of money by the assessee in cash apart from this MOU. We have already discussed that this MOU cannot be said to be a sales simplicitor because various clauses of this MOU are suggesting that this MOU was mainly for entering into a partnership firm between the assessee alongwith his three partners with the other party ie., Savvy Infrastructure Company Limite....
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....ained from the withdrawals from bank account and further no evidence about any other unaccounted assets or receipt of cash was found during the course of search from the appellant's premises. It is also noticed that no specific evidence is referred to by the Assessing Officer that the appellant was paid any amount in excess of the price of Rs. 7.36 Crores as per the documents. The appellant has also specifically pointed out that the price as per the document is also accepted for stamp duty purpose and it is not disputed by that authority. Considering these facts, I assessment of the view that the Assessing Officer has no basis for adopting the sale value of the land at Rs. 14.71 Crores as against the value of Rs. 7.36 Crores as per the document in the form of sale deed dated 3.2.2007. The Assessing Officer is, therefore, directed to consider the sale consideration at Rs. 7.36 Crores as against the amount of Rs. 14.71 crores adopted by him." 3.12 From the above para of the order of learned CIT (A), it is seen that he has given a clear finding that the MOU and no other document can be a basis for the conclusion reached by the Assessing Officer and on the basis of these documents, a ....