TaxTMI 
TaxTMI 
2025 (3) TMI 2098
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....as registered under Amnesty Scheme on 06.02.2016, the value of the property as on 06.02.2016 as per Circle/Guidelines Rates for Stamp Duty purpose was Rs. 19,85,97,000/-. Since the assessee had paid only Rs. 10.00 lakh for his share of 25% in the property, ld. AO was of the view that in terms of section 56(2)(vii)(b) of the Act an amount of Rs. 4,96,49,250/- deserves to be added in the hands of assessee. In the course of assessment proceedings which was carried out after validly serving notices u/s.143(2) and 142(1) of the Act, the assessee claimed that on 12.08.1997 unregistered agreement was entered into with the seller of the property and part consideration was paid through banking channel but the balance amount was payable since some contractual obligations on part of the seller regarding updation of land revenue records with names of original owners and obtaining relevant permissions were to be carried out. The assessee got the possession of the land on 25.01.2001. Finally, the contractual obligations by seller were completed in the year 2014 but till that time as the assessee had not paid the remaining consideration in the year 1997, the purchase consideration was revised to ....
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....the property in the year 1997. He further stated that there is nothing in law to adopt the fixation of consideration at a lower value in sale deed than actual market value/stamp duty and this loophole has been misused to evade payment of tax or make under hand dealing in cash and to prevent this misuse only the provisions of section 50C and 56(2)(vii)(b) of the Act have been inserted in the legislature. 6. On the other hand, Ld. Counsel for the assessee apart from placing reliance on the finding of ld.CIT(A) also referred to the decisions of this Tribunal on identical issue in the case of other co-purchasers where except the fact that the assessee and other co-owners paid part consideration through banking channel on 08.01.1997, all other contentions of the assessee were accepted and even this Tribunal has directed the AO to consider 04.10.2014 as the date of calculating the stamp duty valuation of the land. Ld. AR further submitted that at that point of time when the matter was being heard by this Tribunal in case of other co-purchasers, copy of bank passbook was not available and now the copy of bank passbook is available on record and the same is placed at page 125 of the pap....
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.... same, the stamp duty value on the date of the agreement may be taken for the purposes of this sub-clause. Provided further that the said proviso shall apply only in a case where the amount of consideration referred to therein, or a part thereof, has been paid by any mode other than cash on or before the date of the agreement for the transfer of such immovable property." 9. On going through the above provision, we observe that the said section states that where the consideration paid for acquiring the immovable property is less than the stamp duty value of the property by an amount exceeding Rs. 50,000/-, the stamp duty value of such property exceeding such consideration is to be treated as 'Income from other sources u/s.56(2)(vii)(b) of the Act. But there are two exceptions provided to this provision and they both are relevant for the issue under consideration since it is claimed by the assessee that original agreement to sell was entered on 12.08.1997 and part consideration was paid in advance by banking channel on 08.01.1997 and Stamp Valuation as on 12.08.1997 is to be considered. 10. Ld. AO has invoked section 56(2)(vii)(b) of the Act when he observed that the s....
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....to complete the relevant legal formalities. Assessee agreed to the request, in order to avoid protracted litigation, although sellers had no legal right to claim such compensation in view of clear terms of agreement dated 12.08.1997. Total amount of Rs. 38 lakhs paid through banking channel (3 lakhs in 1997 and 35 lakhs in 2014) 09.09.2015 Unregistered Final Payment Receipt (Bharna Pavti) dated 09.09.2015 88-93 Entire amount of Rs. 72 lakhs paid upto 09.09.2015 through banking channel, including balance amount of Rs. 34 lakhs paid after 04.10.2014. 06.02.2016 Agreement dated 12.08.1997 was REGISTERED before Collector of Stamps, Nashik 94-105 The Agreement to Sale executed on 12.08.1997 was registered with the Collector on 06.02.2016, upon payment of stamp duty and penalty under Amnesty Scheme. The stamp duty of Rs. 5,11,000/- was paid @ 8% on stamp valuation of land as on date of execution of agreement i.e. 12.08.1997, which was assessed at Rs. 63,88,000/- by the Collector, Nashik. Further, penalty of Rs. 20,44,000/- was also paid for regularization of the said agreement. 12. Further, we notice that ld.CIT(A) on considering the fact that the t....
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....nal payment of Rs. 42,00,000/- considering the fact that the consideration of Rs. 30,00,000/- was fixed in the year 1997 and was paid in the said year only to the extent of Rs. 3,00,000/- and the balance payment of Rs. 27,00,000/- was made after substantial period and hence, the value of the same was reduced due to inflation. The contention of the AO that, the impugned consideration was fixed in F.Y. 2015-16 at Rs. 72,00,000/-, cannot be accepted, as the value of the land in this year for stamp duty purpose as per Sub-Registrar's office was Rs. 19,85,97,000/-. In the absence of agreement to purchase dated 12/08/1997 on which the price was fixed at Rs. 30,00,000/-, the sellers would not have determined the price in the year 2015-16 at Rs. 72,00,000/- by demanding compensation for delayed payment. The reason for delay in executing and registering the sale deed was also explained by the appellant in the submission filed. 6.7 In support of the above contention, on the above issue, the appellant has placed reliance on the decision of Honorable Mumbai ITAT, in the case of Maitri Ms. Maitri Morarji Vs. ITO-4 (1), Mumbai, ITA. No. 3864/Mum/2016, vide order dated 05/12/2018. In....
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.... was levied on the value of the property in the year 1997, of Rs. 63,88,000/- @ 8% at Rs. 5,11,000/-, 'Therefore, the contention and conclusion of the AO that, the value of the asset on the date of registered sale deed on 06.02.2016 is to be considered at 25% of Rs. 19,85,97,000/- cannot be upheld. 6.9 It is also noticed from the submission of the appellant that, during the scrutiny assessment proceedings of one of the co-purchasers of the impugned land viz. Shri Shilesh R. Shah, the National Faceless Assessment Center, Delhi has accepted the identical contention of the assessee and passed assessment order u/s.143(3) r.w.s.263 r.w.s. 144B of the Act and accepted the contention of the assessee. 6.10 It is further noticed from the submission of the appellant that, in the case of one of the co-owners of the impugned land viz. Shri. Pravinchandra Walchand Shah, the Pr.CIT had passed revision order u/s 263 directing the AO to make addition u/s 56(2)(vii)(b). Shri. Pravinchandra Valchand Shah had filed appeal against the order u/s 263 for AY 2016-17 before the Honorable ITAT Pune. The Honorable ITAT Pune decided the appeal vide order dt. 19.07.2022. The Honorable IT....
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....nced consideration in the year 2014 to compensate the reduction in value of balance consideration, the A.O. is not justified in concluding that the consideration for sale of land was not fixed vide agreement dated 12.08.1997. In this regard, the CIT(A) has relied upon the decision of Hon'ble ITAT Mumbai in case of Ms. Maitri Morarji v. ITO [ITA No. 3864/Mum/2016] dated 05.12.2018 to delete the addition u/s 56(2)(vii)(b) made by the A.Ο. 14. Secondly, in para 6.8, the CIT(A) has noted that on 06.02.2016, it was only the earlier agreement dated 12.08.1997 which was registered belatedly upon payment of stamp duty and penalty. At the time of registration, the Stamp Duty Authority has adopted the valuation of the said land at Rs. 63,88,000/- and levied stamp duty @ 8% thereon, which works out to Rs. 5,11,000/-. In view of this categorical finding, the CIT(A) has held that the A.O. could not have substituted the valuation of the land adopted by the Stamp Duty Authorities at Rs. 63,88,000/- with the FMV of the land of Rs. 19.85 crore. prevailing as on the date of registration i.e. 06.02.2016. Accordingly, the CIT(A) has held that the addition u/s.56(2)(vii)(b) made by the A....
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.... the paper book. Further when the contractual obligations were completed and names of original owners were entered into the Government Land Records on 04.10.2014, the purchase consideration was revised to Rs. 72.00 lakh which seems to be normal considering the fact that the assessee along with other co-owners did not pay Rs. 27.00 lakh (part consideration of Rs. 30.00 lakh fixed in the agreement dated 12.08.1997) and certainly the value of money reduced from 1997 to 2014. Therefore, the purchase consideration was revised from Rs. 30.00 lakh to Rs. 72.00 lakh. Now another important fact is that when the assessee approached the stamp value authority for registering the agreement to sale dated 12.08.1997 under Amnesty Scheme stamp duty of Rs. 5,11,000/- was paid @8% on the value assessed at Rs. 63,88,0000/- and further penalty of Rs. 20,44,0000/- was also paid for regularization of the said agreement. This act of the stamp valuation authority collecting the aforesaid stamp duty and penalty itself prove that they were satisfied with the correctness and genuineness of the agreement dated 12.08.1997 and therefore gave the benefit of Amnesty Scheme to the assessee. Had they been not satis....