2022 (8) TMI 799

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....90/-. The assessee is a builder and developer. Assessment order was passed u/s 143(3) of the Income-tax Act, 1961 (hereinafter referred to as "the Act") assessing total income at Rs. 66.76,365/-. In the assessment order, the A.O made an addition of Rs. 19,58,875/- u/s 43CA of the Act being the difference between sale value of the flats sold and the stamp duty value of the same. It was contended by the assessee that stamp value was at uniform rate without taking into consideration the peculiar features of a particular property. It was also contended that the A.O has ignored the fact that the difference of Rs. 19,58,875/- was less than 10% and therefore, not required to be added. 3. Section 43CA of the Act provides that where a considerati....

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....for the purpose of payment of stamp duty then the difference will taxed as deemed income. At the same time, the proviso to this section states that if there is a difference of such value within 10% margin then there cannot be any addition on the pretext of deemed income and this 10% margin has been inserted by Finance Act, 2020 w.e.f. 1-4-2021. The assessment year under consideration before us is A.Y. 2015-16 which is prior to the date when the amendment took place and such 10% margin was inserted. The question therefore, arises whether this amendment effective from 1-4-2021 can even apply to prior assessment years as well. The assessee had relied on Pune Tribunal decision in ITA No. 923/PUN/2019 (supra) where the Tribunal has given retrosp....

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....larificatory in nature and he levied surcharge by passing rectification order u/s 154 of the Act. However, the Tribunal and the Hon‟ble High Court upheld the assessee‟s claim that the said amendment was prospective in nature and did not apply to block period falling before 01-06- 2002. However, the plea of the assessee was rejected by the Hon‟ble Supreme Court in CIT Vs. Suresh N. Gupta (2008) 297 ITR 322 (SC) also held that the proviso to section 113 is clarificatory and hence, should be read into block assessment scheme under Chapter XIV-B with retrospective effect. Similar view was reiterated by the Hon‟ble Supreme Court in CIT Vs. Rajiv Bhatara (2009) 310 ITR 105 (SC) by holding the proviso u/s 113 to be retrospe....

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....with retrospective effect. The CBDT circular No. 2002 dated 27-08-2002 also makes it clear that the amendment to section 113 is prospective. Consequently, the conclusion reached in Suresh Gupta (297 ITR 322) (supra) treating the proviso to section 113 of the Act as clarificatory and having retrospective effect was held to be incorrect and was over-ruled. 6. The essence of the decision is that if any liability has to be fastened with the assessee tax-payer retrospectively then the statute and the provision must spell out specifically regarding such retrospective applicability. However, if the provision is beneficial for the assessee, in view of the welfare legislation spirit imbibed in the Income-tax Act, such beneficial provision can be ....