TaxTMI 
TaxTMI 
2026 (9) TMI 593
X X X X Extracts X X X X
X X X X Extracts X X X X
....oint ownership an immovable property by a registered sale deed dated 06.05.2013 with agreed value amount to Rs. 1,18,00,000/- and difference in between the agreement value and stamp duty value amount to Rs. 1,59,76,895/- considering 50% share of the assessee. The Ld. AO issued the show cause notice and asked to explain the difference between stamp duty value amounting to Rs. 4,37,53,790/- and the purchase value of Rs. 1,18,00,000/-= Rs. 3,19,53,790/-, the assessee's share should not be taken as income chargeable to tax under the head "Income from Other Sources" under section 56(2) of Act. The assessee had contend that whether the registration was executed in the impugned assessment year but the allotment of the said property was on 11.04.2007 and the copy of allotment letter was duly submitted before the revenue authorities. The total valuation of the property as per the deed of agreement amount to Rs. 1,18,00,000/- and assessee had paid amount to Rs. 30,00,000/- for allotment of the property through account payee cheque. The Ld. AO without considering the assessee's submission, had initiated the proceeding and confirmed the addition u/sec. 56(2)(vii)(b) amount to Rs. 1,59,76,895/-....
X X X X Extracts X X X X
X X X X Extracts X X X X
...., but agreements were registered in AY 2014-15 Assessing Officer invoked section 43CA and substituted stamp duty value of Rs. 4.48 crores for stated consideration, resulting in addition of Rs. 2.06 crores - It was noted that flats were allotted and agreements were duly executed during A.Y. 2012-13 itself - Whether rigours of section 43CA, inserted with effect from 01.04.2014, would not be applicable to impugned transactions - Held, yes - Whether, therefore, addition made by Assessing Officer was unsustainable in law and liable to be deleted-Held, yes" 5. Identical issue is considered by the Coordinate Bench of the ITAT-Kolkata Bench in case of Reegal Construction vs ITO reported in (2023) 154 taxmann.com 350 held that provisions of section 43CA shall apply prospectively in relation to transaction entered post 01.04.2014 and would not apply where booking of flats was done in the year 2012 or 2013. 6. The Ld. AR contended that the Ld. CIT(A) had considered the issue regarding the applicability of section 56(2)(vii) of the Act to a transaction initiated prior to the insertion of the said provision by the Finance (No. 2) Act, 2009. The Ld. CIT(A) observed that the date of registr....
X X X X Extracts X X X X
X X X X Extracts X X X X
....f the Tribunal relied upon by the assessee, as noted in the foregoing paragraphs, while directing the AO to compare the stamp duty valuation as on the date of allotment with the transaction value recorded in the registration document, we find that the coordinate bench took into consideration the fact that the taxpayer, in that case, paid an amount of INR 2 lakh at the time of booking prior to the allotment letter. However, in the present case, no such evidence of payment of agreed consideration or part thereof by any mode other than cash on or before the date of the allotment letter has been brought on record. Therefore, in order to grant one more opportunity to the assessee in the interest of justice and fair play, we deem it appropriate to restore this issue to the file of the jurisdictional AO for adjudication in view of our aforesaid findings with a direction to the assessee to furnish the evidence of payment of agreed consideration or part thereof by any mode other than cash on or before the date of allotment letter to prove the applicability of the first and second proviso to section 56(2)(vii)(b) of the Act. We order accordingly. As a result, the impugned order on this issue....
X X X X Extracts X X X X
X X X X Extracts X X X X
....on of the Coordinate Bench in Manjulaben Himmatlal Jain (supra). In the said decision, the Coordinate Bench recognised the relevance of the date of allotment and specifically examined whether the agreed consideration or part thereof had been paid through a mode other than cash on or before the relevant date. In the present case, the assessee has produced the allotment letter as well as evidence of payment of Rs. 30,00,000/- through banking channel in pursuance of the allotment. The decisions relied upon by the Ld. AR in Lodha Developers Ltd. (supra) and Reegal Construction (supra), though rendered in the context of section 43CA, also support the proposition advanced by the assessee that a subsequently introduced deeming provision cannot ordinarily be applied merely because registration of an already initiated transaction takes place after the provision has come into force. 11. It is pertinent that section 56(2)(vii) was inserted by the Finance (No. 2) Act, 2009 with effect from 01.10.2009. The transaction evidenced by the allotment letter and payment of part consideration in the present case dates back to April 2007. Therefore, the provisions of section 56(2)(vii)(b), which were....