2022 (1) TMI 782

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... 1. On the facts and circumstances of the case and in law, the Principal Commissioner Income-tax - 19, Mumbai ("the Pr.CIT") erred in assuming jurisdiction under section 263 and holding the assessment order, under section 143(3) of the Income-tax Act, 1961 ("hereinafter referred to as "the Act") dated 09.11.2017 (hereinafter referred to as "the assessment order"), as erroneous and prejudicial to the interest of the revenue. The reasons given by him for doing so are wrong, contrary to the facts of the case and against the provisions of law; 2. The Pr. CIT failed to appreciate that, where two views are possible and the Assessing Officer (hereinafter referred to as "the AO"), after conduct of due enquiry, has taken one view wi....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....greement dated 27-01-2015. However, for stamp duty purpose, the stamp duty authority has valued the property at Rs. 6.09 crores. Whereas, while completing the assessment the assessing officer made no addition of the differential value as required under section 56(2)(vii)(b)(ii) of the Act. He further observed, the stamp duty value for the year under consideration was Rs. 2,70,300 per sq.mtr as on the date of registration. Applying the said rate, the value of the property would be Rs. 5.80 crores. Whereas, the assessee had paid an amount of Rs. 5.02 crores. Thus, he observed, failure to adopt the appropriate market value / stamp duty value of the property has resulted in under assessment of income to the tune of Rs. 77,76,649/-. Being of the....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....of the paper book. He submitted, in response to the notice issued, assessee furnished a reply with all supporting evidences. He submitted, in her reply, the assessee had clearly stated that Flat No.B-5102 in Trump Tower, Worli was booked in financial year 2013-14 for a consideration of Rs. 5,02,31,276/- at the prevailing market rate, whereas, the agreement was registered o 27-01-2015 when the prevailing ready reckoner value had increased to Rs. 6,09,15,500/-. Further, he submitted, assessee is merely a coowner of the property and all contributions towards the purchase value of the property were made by the first owner, Shri Shantilal Mehta. In this context, he drew our attention to the copy of sale agreement at page 22 of the paper book and....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ection 263 of the Act. 6. We have considered rival submissions and perused materials on record. We have also applied our mind to the decision relied upon. Undisputedly, assessee's case was selected for limited scrutiny. A perusal of notice dated 28-07- 2016 issued under section 143(2) of the Act, a copy of which is at page 1 of the paper book, reveals that the scope of scrutiny was to examine the purchase of property. In response to notice issued under section 143(2) of the Act, the assessee filed its reply on 24-04-2017 furnishing the details of flat No.1004 purchased at Anchor Daewoo, Malabar Hill for a declared consideration of Rs. 135 lakhs. The assessee filed a further reply on 25-09-2017 furnishing the details of another property p....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....even remotely establish that any enquiry was made by the assessing officer regarding applicability of section 56(ii)(vii)(b)(ii) of the Act to the subject transaction. Therefore, non examination of applicability of section 56(2)(vii)(b)(ii) has certainly made the assessment order erroneous and prejudicial to the interest of revenue. Therefore, to that extent, learned PCIT was justified in exercising his jurisdiction under section 263 of the Act to revise the assessment order. 8. Having held so, we must observe, learned PCIT has exceeded his jurisdiction in making various other observations touching upon the merits of the issue. Firstly, learned PCIT was totally wrong in substituting his own valuation of the property in place of stamp dut....