TaxTMI 
TaxTMI 
2026 (9) TMI 1174
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....ing addition of Rs. 1,42,89,204/- to the total income under section 56(2)(x) of the Income-tax Act, 1961; 2. On facts and circumstances of the case and position in law, the learned CIT(A) failed to appreciate that in view of first and second proviso to section 56(2)(x), the relevant date for comparison of agreement value and stamp duty value was the date of allotment of the immoveable property and not the date of registration; 3. The appellant submits that the immoveable property was purchased on 27/04/2001 and that the appellant was already in possession of the property and therefore, there was no "receipt" of immoveable property during the year under consideration, therefore, the provisions of section 56(2)(x) had no application during the year under consideration; 4. The above grounds of appeal are without prejudice to one another and the appellant craves leave to add, alter, amend, delete or modify any of the above grounds of appeal. 3. The brief relevant facts of the case are; that the Assessee is a trust engaged in charitable/religious activities and registered under section 12A of the Act vide registration order dated 24.06.2004/24.03.2004 beari....
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....vance payments of Rs 11,00,000/- by cheque of bank account of assessee, with further installments upto 2005. It was also placed on record that formation of the trust carried out in executive committee meeting held on 25-06-2000 that was the date of existence of trust, following that bank account no. 091110011428 with the then Dena Bank, Yogi Nagar Branch, Boriwali, opened on 28-06-2000. The property was in continuous possession of assessee from 2001 and utilizing for charitable activities with Electricity, water connection etc in its name, the copy of bills of utility services were also produced. The Commissioner Income tax, appeals also doubted that how appellant trust entered into agreement for purchase of an immovable property before its incorporation, when there was no legal existence of trust. The mere date of incorporation mentioned in the PAN alone cannot be basis for denial of its existence, however, other material documents like bank statement, affidavit of the trust member etc also proved that it was in existence prior to that date. However, the CIT (appeals) did not endorse its contention, and observed that no agreement to sale between the seller and assessee was execute....
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....Mum/2021, wherein the Tribunal has held that in cases where assessee has made advance payments through banking channel, is entitled to the benefit of the proviso to section 56(2)(x)(b) of the Act. 10. It is further submitted that the trust was formed in pursuance of a General Body Resolution dated 25th June, 2000 and, in support thereof, placed on record an affidavit dated 23rd January, 2021 of the trustee, Shri Kishore Durlabhji Ghatani, affirming the said facts. 11. Apart from the above, assessee also submitted property tax payment receipts, water, electricity and gas bills relatable to the property since 2003 and a copy of the passbook containing the name of the account holder and showing that the bank account was opened on 28th September, 2000. Further, contended that the trust had taken possession of the property in 2003 and relied upon the contemporaneous documents in evidence to support its possession over the property from 2003-04. 12. The Ld. AR of the Assessee also raised legal ground the provisions of section 56(2)(x) are not applicable on trust registered under section 12A of the Act, in respect of acquisition of immovable property are not applicable. The assessee pl....
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.... payment of Rs.11,00,000/- for booking of the flat at Mumbai on 24th April, 2001, further, confirmed by the seller, Vijaynagar Corporation. As the assessing officer has neither rejected that fact nor carried out any independent enquiry for verification of averment of the affidavit to prove otherwise. 17. In view of these undisputed facts of existence of trust prior to 01-04-2002, banking transactions carried out prior to that date, we are of the opinion that it was in existence. As we are satisfied about its existence prior to 1st April, 2002, the advance payment of Rs.11,00,000/- transferred through banking channel to the seller, Vijaynagar Corporation, also satisfies the condition of the proviso to section 56(2)(x) for the purpose of adoption of the stamp duty value of FY 2001-2002 of the flat for determination of difference in value for computation of deemed income. The proviso to section 56(2)(x) of the Act is mentioned hereunder: Where any person receives, in any previous year from any person or persons on or after the 1st day of April, 2017 (a) any sum of money, without consideration, the aggregate value of which exceeds fifty thousand rupees, the whol....
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....e payment was made through banking channels prior to execution of the sale agreement, the proviso to section 56(2)(x) should apply and no addition could be made to the assessee's income by adopting the stamp duty value of the property on the date of registration of the sale deed. The relevant findings of the Tribunal are extracted hereunder: "5. Heard both the sides and perused the material on record. During the course of assessment, the assessing officer noticed that assessee had purchased flat no. 204, B-Wing, "Insignia" building situated at Kalina, Santacruz (E), Mumbai for a consideration of Rs. 1,79,94,452/-. However, the value of the said property as per the stamp duty was determined at Rs. 2,73,41,000/-. Therefore, the assessing officer has added difference of Rs. 93,46,548/- in the total income of the assessee after applying the provisions of section 56(2)(x) of the Act. The assessee has submitted the copies of allotment letter of flat no. 1601 & 1701 dated 18.03.2011 wherein it is categorically stated that said flat has been allotted to the assessee and the assessee had paid Rs. 25,00,000/-. The assessee has also referred the allotment letter issued on 26.04.2....
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....amp duty value of such property, (4) for a consideration, the stamp duty value of such property as exceeds such consideration, if the amount of such excess is more than the higher of the following amounts, namely (i) the amount of fifty thousand rupees, and (ii) the amount equal to ten per cent of the consideration: Provided that where the date of agreement fixing the amount of consideration for the transfer of immovable property and the date of registration are not the same, the stamp duty value on the date of agreement may be taken for the purposes of this sub-clause: Provided further that the provisions of the first proviso shall apply only in a case where the amount of consideration referred to therein, or a part thereof, has been paid by way of an account payee cheque or an account payee bank draft or by use of electronic clearing system through a bank account or through such other electronic mode as may be prescribed28, on or before the date of agreement for transfer of such immovable property." 6. The First Proviso to section 56(2)(x) of the Act as above provides that where the date of agreement fixing the amount of consi....