TaxTMI 
TaxTMI 
2026 (9) TMI 1621
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....irmed. Reasons assigned by him are wrong and insufficient to justify addition of Rs. 443600 under section 56(2)(vii)(b) of the Act. 2) On the facts and the circumstances of the case and in law the learned Commissioner of Income tax Appeals ought to have appreciated that date of purchases of property is 20.06.2010 and therefore provisions prevailing on that date does not cover cases of WHARE agreement value is less than value adopted by stamp duty authorities. 3) On the facts and the circumstances of the case and in law the learned Commissioner of Income tax Appeals erred in arriving at the conclusion that conditions enumerated in proviso to section 56(2)(vii)(b) are not complied with and therefore stamp duty value as on 20.06.2010 is not applicable to appellants case. 4) On the facts and the circumstances of the case and in law the learned Commissioner of Income tax Appeals ought to have appreciated that share of the appellant in property is 50 percent only therefore whole of amount of Rs. 443600 cannot be added in the hands of the appellant. 5) On the facts and the circumstances of the case and in law the learned Commissioner of Income tax Appea....
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....On the facts and circumstances of the case and in law the learned Assessing Officer failed to serve draft assessment order as provided under section 144B xxi of the Act, thereby assessment completed under section 147 rws 144B of the Act is bad in law, contrary to the provisions of the Act invalid, void ab initio and liable to be annulled. 10) On the facts and circumstances of the case and in law Show Cause Notice dated 11.04.2023 is bad in law, invalid in as much as same in not in conformity with SOP issued by department allowing minimum seven day time to respond by the appellant which make subsequent assessment also invalid, void ab initio and liable to be annulled. 11) On the facts and circumstances of the case and in law, the learned Assessing Officer failed to serve copy of order under section 151 passed by the Principal Commissioner of Income tax granting sanction to issue notice under section 148 of the Act, thereby issue of notice under section 148 of the Act subsequent proceeding and assessment are liable to be quashed and annulled. 2. The brief facts of the case are that the assessee, Shri Pushpendra Prakash Dharmawat, is an individual who filed his re....
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....relevant transaction and compared the consideration of Rs. 33,51,900/- with the stamp duty value of Rs. 37,95,500/- (this is the stamp duty value of the property taken for registration purposes when the subsequent agreement was registered on 22.12.2016). The Assessing Officer taxed the difference of Rs. 4,43,600/- under section 56(2)(vii)(b) of the Act. 6. The learned CIT(A) upheld the action of the Assessing Officer. The CIT(A) held that the relevant transfer and registration had taken place during F.Y. 2016-17 relevant to A.Y. 2017-18 and, therefore, the provisions of section 56(2)(vii)(b) of the Act were applicable. The CIT(A) also rejected the contention that the transaction had to be considered with reference to the original tenancy rights and the earlier redevelopment arrangement. The assessee's contention that the tenancy rights and subsequent allotment were jointly held by the assessee and his mother was also rejected on the ground that the investment and consideration were reflecting in the hands of the assessee and no material had been produced to establish the share of the mother. 7. The CIT(A) further upheld the stamp duty value of Rs. 37,95,500/- prevailing at th....
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.... any previous year". Therefore, for making an addition in A.Y. 2017-18, it has first to be established that the assessee received the property contemplated by the section during the previous year relevant to that assessment year. 12. The nature of the property covered by the provision is also important. For this purpose, "property", insofar as immovable property is concerned, means "immovable property being land or building or both". The provision does not say "land or building or any right therein". This distinction importance because section 56(2)(vii)(b) of the Act creates a deeming fiction and such a fiction has to be confined to the situation expressly covered by the statutory language. 13. The principle that a deeming provision referring to "land or building or both" cannot be enlarged to include a mere "right" in land or building has been considered by the Coordinate Bench in ACIT v. Ashok Narendra Mehta, ITA No. 3373/Mum/2024, order dated 28.08.2024. The Tribunal held that tenancy rights are rights in land or building and are distinct from the land or building itself. It further held that section 56 of the Act, being a deeming provision, has to be construed strictly a....
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.... the stamp duty value of Rs. 37,95,500/- and taxed the difference of Rs. 4,43,600/-. The learned CIT(A) substantially upheld this approach. 18. We are unable to agree with this approach. 19. The first difficulty with the approach of the Tax authorities is that it ignores the origin and true character of the transaction. The assessee did not approach the developer in 2016 as an ordinary purchaser of a flat. The assessee and his mother already possessed tenancy rights in the old premises. Their entitlement to the proposed new premises arose because the existing building was taken up for redevelopment and those tenancy rights were to be surrendered. The monetary consideration for the additional area was only one component of the entire arrangement. Therefore, the entire proposed premises could not be treated as though it had been independently purchased by the assessee merely for the monetary consideration mentioned in the subsequent registered agreement. 20. This is precisely where the ratio of Ashok Narendra Mehta assumes importance. The portion attributable to surrender of tenancy rights has to be kept separate from the additional area independently purchased for monetary ....
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....matic conclusion that the assessee had "received" the building in the year of registration when the building itself had not come into existence. Registration of an agreement and receipt of the property are not expressions which the Statute treats as synonymous. Had the Legislature intended registration of an agreement to constitute the charging event, it could have expressly so provided. Instead, the statue used the word "receives". 26. The statutory scheme itself reinforces this distinction. The provisos to section 56(2)(vii)(b) separately refer to the "date of the agreement fixing the amount of consideration" and the "date of registration". Thus, the Legislature was fully conscious of an agreement and its registration while drafting the provision. Yet, in the opening charging part of section 56(2)(vii), it chose the expression "receives, in any previous year". These different expressions used in the same provision cannot be treated as meaning the same thing. 27. The importance of adhering to the actual words employed by Parliament is greater because section 56(2)(vii)(b) is a deeming provision. The Coordinate Bench in Ashok Narendra Mehta, after considering Atul G. Puranik ....