TaxTMI 
TaxTMI 
2022 (3) TMI 1670
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.... on the subject, the learning Commissioner appeals has confirming the action of assessing officer making addition of Rs. 24,98,040/-on account of unexplained investment under section 56(2)(vii)(b) of the Act. 2. Brief facts of the case are that during the scrutiny assessment the assessing officer noted that assessee along with other two co-owner have purchased immovable property/ land at Survey No. 247, Limodara Village Surat for a total consideration of Rs. 45,51,000/-. The jantri value of said property was determined by Stamp valuation authority at Rs. 87,14,000/-. Thus, there was a difference of Rs. 41,63,400/- in the purchase consideration shown by assessee and in value determined by Stamp valuation Authority. The assessing....
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....fficer. The valuation officer vide his report dated 28th December 2016, valued the said property at Rs. 89,43,000/-. The assessing officer recorded that as per the assessee request the case was referred to the valuation officer of department and the valuation officer estimated fair market value of the property at Rs. 89,43,000/-, and the jantry value estimated by stamp valuation of Rs. 87,14,400/-. The assessing officer further recorded that as per section 50C(3), wherein the value ascertained by the valuation officer exceeds the value adopted by stamp valuation authority, the value so adopted or assessed by such stamp authority shall be taken as the full value of consideration received. Accordingly, the assessing officer adopted the v....
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....r submitted that he is placing on record the location plan of the Surat Municipal Corporation, which id downloaded from google map. The land is far away from the municipal boundary. The Ld. AR for the assessee further submits once it is held that the land is not a capital asset as defined in the Act, no addition is liable to be sustained. Even otherwise on merit the grounds of appeal raised by assessee are covered by the decision of Pune Tribunal in Mubarak Gafur Korabu Vs ITO (ITA No. 752/PUN/2018 dated 5th April 2019. The decision of Pune Bench was followed by Surat Bench in recent decision in Vithalhbai Kadvabhai Korat Vs ITO (ITA No. 339/SRT/2018 dated 27.11.2020, copy of both the decisions are placed on record. 5. On the o....
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....3 and value determined by staff valuation authority. The ld. CIT (A) confirmed the action of Assessing Officer by taking view that Assessing Officer acted as per the Provision of Section 56(2)(vii)(b). 8. We find that lower authority has not examined the nature of land and solely made addition on the basis of difference between the value determined by staff valuation authority for the purpose of calculation of stamp duty. Before us, the Ld. AR of the assessee vehemently argued that the agricultural land purchased by assessee is not a capital asset being rural agriculture land. We find that Co-ordinate Bench of Pune Tribunal in the case of Mubarak Gafur Korabu while considering the similar submission that agricultural land is not a capita....
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....e of assessee before us is that it has purchased agricultural asset which was held as 'Current Asset' by the assessee and when the same was sold in 2016, business income was declared on the said transaction. The assessee also stressed that agricultural land purchased by assessee was not capital asset, for which reliance was placed on the definition of 'capital asset' under section 2(14) of the Act. As per terms used under the Act, an immovable property is defined to be the land or building or both as per clause (d) of Explanation under the said section. Hence, clauses (a) and (b) of section 56(2)(vii) of the Act are not attracted. Clause (c) talks of any property other than immovable property. Section 2(14) of the Act defines 'capital asset....
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....bullion. 10. In the totality of above definitions, we hold that agricultural land purchased by assessee is not governed by the provisions of section 56(2)(vii)(b) of the Act being not capital asset and also because of the fact that the assessee was holding it as stock in trade. Hence, it is outside the purview of said section and no addition has to be made in the hands of assessee. 11. Now, coming to the decision of Jaipur Bench of Tribunal in ITO Vs. Trilok Chand Sain (supra), wherein provisions of clause (b) of section 56(2)(vii) of the Act were considered. However, they have failed to take into cognizance the provisions of clause (c) of said section, which talks of property other than immovable property. The Tribunal in....