TaxTMI 
TaxTMI 
TaxTMI 
2023 (4) TMI 470
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.... of income for A.Y.2017-18 on 24.03.2018, declaring an income of Rs.55,41,240/-. Subsequently, the case of the assessee was selected for scrutiny assessment u/s.143(2) of the Act. 3. During the course of the assessment proceedings, it was observed by the A.O that the assessee company had debited in its profit & loss account an amount of Rs.2,24,25,380/- under the head "sale registration charges". On being queried about the nature of the aforesaid expenses, it was stated by the assessee that the same were the expenses which were incurred towards stamp duty and registration fees in some instances of sale in order to promote its sales. However, the A.O did not find favour with the explanation of the assessee as regards the allowability of its aforesaid claim for deduction of registration charges. The A.O was of the view that as it was an obligation of the purchaser to pay stamp duty and registration fees in order to strengthen his title as regards the property purchased, therefore, the claim for deduction of the same as an expenditure by the assessee was totally unjustifiable as there was no obligation cast upon it to have incurred the same. Alternatively, it was observed by the A.O ....
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....s the said expenses could be fastened on the purchaser. Alternatively, it was observed by the CIT(Appeals) that even otherwise as per the amendment made available on the statute vide the Finance Act, 2019 which was applicable w.e.f. A.Y.2014-15, a variation upto 10% between actual consideration and the value adopted for stamp duty purpose was to be ignored within the meaning of Section 43CA of the Act. Therefore, considering the fact that the were difference in the present case varied between 5% to 7%, the CIT(Appeals) was of the view that no addition on the said count could have been made in the hands of the assessee. On the basis of his aforesaid observations the CIT(Appeals) vacated the addition of Rs.2,24,25,380/- made by the A.O. 5. The revenue being aggrieved with the order of the CIT(Appeals) has carried the matter in appeal before us. 6. We have heard the ld. Authorized Representatives of both the parties and perused the orders of the lower authorities as well as the material available on record. 7. Admittedly, it is a matter of fact borne from record that the assessee company which is engaged in the business as that of a developer, had in order to promote its sales incu....
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.... not. On perusal of evidences on record it is evidently clear that appellant has paid stamp duty charges which is clearly mentioned on e-stamp purchased under heading Stamp Duty Paid By: MAHAVIR INFRACON PVT LTD' and the same has been mentioned in registered sale deed. Therefore, it is evidently clear that appellant has paid stamp duty charges. 4.1.2 It is interesting to mention here that the AO has also invoked provisions of section 43CA of the Act. For ready reference the relevant provision al. the Act is reproduced as under:- 43CA. (1) Where the consideration received or accruing as a result of the transfer by an assessee of an asset (other than a capital asset), being land or building or both, is less than the value adopted or assessed or assessable by any authority of a State Government for the purpose of payment of stamp duty in respect of such transfer, the value so adopted or assessed or assessable shall, for the purposes of computing profits and gains from transfer of such asset, be deemed to be the full value of the consideration received or accruing as a result of such transfer: Provided that where the value adopted or assessed or assessable by the authority for ....
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.... the contrary the expenses in relation to stamp duty payable on transfer of asset shall be borne by the buyer. In the instant case, the liability for payment of stamp and registration fees expenses has been clearly mentioned in registered sale deeds. Therefore, it cannot be alleged that the liability of making payments towards stamp duty is of the purchaser. 4.1.4 Most importantly, an amendment has been made by Finance Act 2019 to provide that a variation of upto 10% between actual consideration and the value adopted for stamp duty is to be ignored and is applicable from the date when provisions of section 43CA of the Act were brought into the statue book i.e from AY 2014-15. In the case of appellant the difference varies between 5% to 7%. The appellant in support has placed reliance on following case laws:- (a) Maria Fernandes Cheryl vs. Income Tax Officer (International Taxation) 2(3)(1) (2021) 209 TTJ 850 (b) Sandeep Patil Vs. Income Tax Officer in ITA No.924/Bang/2019 (c) Kishore Hira Bhandari Vs. Income Tax Officer in 177 ITD 565 (d) CIT Vs. Calcutta Export Company reported in 404 ITR 654 (e) C.B Gautam Vs. Union of India and Others in 199 ITR 530 (f) Rahul Const....