TaxTMI 
TaxTMI 
2023 (7) TMI 602
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....; Assessment was completed based on the written submission filed by the assessee. The returned income of Rs. 12,30,170/- was accepted and assessment order under Section 143(3) dated 12.11.2019 was passed by the Assessing Officer. 3. This assessment order was examined by the Principal Commissioner of Income Tax (for short "PCIT") and noticed that the assessee alongwith other co-owner sold immovable property for Rs. 3,57,36,000/- on 25.07.2016 which was purchased on 19.09.2009 for a consideration of Rs. 3,51,30,000/- and the assessee has shown Long Term Capital Loss of Rs. 1,19,28,034/-. On verification of the register sale deed dated 25.07.2016 the Stamp Duty paid was Rs. 26,62,300/- at the prevailing Stamp Duty rate of 4.9%, thereby, the cost of Non-Agricultural land works out to Rs. 5,43,32,653/-. As per the provisions of Section 50C of the Act the value of the said land should have been considered for Rs. 5,43,32,653/-. Further verification of the sale deed dated 25.07.2016 that the assessee has taken an advance of Rs. 3,51,30,000/- as early as 18.03.2009 i.e. just one day before purchase of this piece of land namely 19.09.2009 from the very same parties, that is whatever purcha....
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....stered sale deed in 2009 which is final evidence for purchase and assessee has received back a sum of Rs. 3,51,30,000/- in the same Financial Year 2009-10 was an independent transaction between the same parties of purchase of property by way of a loan transaction. Therefore, the assessee claimed that he was eligible for indexed cost of acquisition as per the provisions of Section 48 of the Act, which cannot be denied by any extraneous observation. The Assessing Officer having examined the issue of applicability of the provision of Section 48 of the Act and accepted assessee's claim during the original assessment proceedings, the same cannot be an erroneous order passed by the Assessing Officer which is also prejudicial to the interest of Revenue. Therefore, this issue is also liable to be dropped for initiation of 263 proceedings. 6. The Ld. PCIT after considering the objection filed by the assessee and held as follows: "13. The contentions of the assessee have duly been considered. However, on perusal of Sale Deed vide Regn. No. 10813/2016, it is noticed that there is mention of advance taken by the assessee of Rs. 3,51,30,000/- on 18.03.2009 which means that whatever purchase ....
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....passed allowing any relief without inquiring into the claim; ......" Thus, the Ld. PCIT relying upon the Supreme Court judgment in the case of Malabar Industrial Co. Ltd. vs. CIT (2000) 109 taxman 66/243 ITR 89 (SC) where the Hon'ble Apex Court has held that both the twin conditions namely order is erroneous and prejudicial to the interest of Revenue, should be satisfied to the exercise powers under the provisions of Section 263 of the Act and an incorrect assumption of fact or an incorrect application of law by the Assessing Officer will satisfy the requirement of order being erroneous. Thus, the Ld. PCIT held that the Assessing Officer failed to bring the correct income to tax as discussed above and invoking the powers vested under him under Section 263 of the Act is partly set-aside the assessment order passed under Section 143(3) of the Act and directed the Assessing Officer to pass a fresh assessment order after making enquiries and verification thereof and pass fresh assessment order by offering proper opportunity to the assessee. 8. Aggrieved against the Revision order, the assessee is in appeal before us raising the following grounds of appeal: "1. Ld. PCIT-3 has erre....
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....of Rs. 3,51,30,000/- whereas the assessee sold the same land by converting it into a non-agricultural land to the very same parties namely Hasmukhbhai Javanmal and Ratilal Javanmal by Sale Deed dated 25.06.2016 for a consideration of Rs. 3,57,36,000/-. As per the registered Sale Deed a sum of Rs. 3,51,30,000/- amount which was paid by various cheques numbers drawn by Bank of Baroda all dated 18.03.2010 is adjusted against the present sale consideration and the remaining balance amount of Rs. 5,99,940/- was paid by two cheques drawn on HDFC Bank both are dated 22.07.2016 and also made TDS of Rs. 6,06,600/-. Thus, the Ld. D.R. submitted the assessee has received Rs. 3,51,30,000/- as early as 18.03.2010 and the remaining 5,99,940/- in the year 2016. Thus, the assessee has received the sale consideration as early as 2009, therefore, the question of indexation for cost of acquisition cannot be provided to the assessee. This issue was not considered by the Assessing Officer while passing the assessment order, though copy of the Sale Deed was produced by the assessee, which is clearly reflecting in the registered Sale Deed the details of transaction. Thus, the Assessing Officer order is e....