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2017 (10) TMI 1536 - AT - Income TaxUnexplained investment u/s 69C - whether the lands were sold at the lower price then the value stated in sale deed for the purpose of stamp duty? - AO made an assessment holding that the market value of the land is higher and stamp duty has been paid on the higher value which proves that the rate of land on the relevant period are higher - CIT(A) deleted the above addition - HELD THAT - According to CIT-A nothing adverse was noticed from the reply of the parties from whom the enquiries were conducted by the AO and in fact they confirmed that the transaction of the sale of the properties is at the purchase price shown by the appellant. Provision of section 50C for that relevant year applied in the hands of the seller and not the buyer. In the present case the assessee is a buyer. Hence, he stated that income cannot be added in the hands of the assessee by invoking provision of section 50C of the Act. He further examined that provision of section 56(1)(vii)(b) of the Act is not applicable as it applies w.e.f. 01.04.2014. DR also could not point out any infirmity in the order of the ld CIT(A). we are also of the considered view that there is no provision of difference between stamp duty value as well as the transacted value can be added in the hands of the buyer. In the result we confirm the finding of the ld CIT(A) and dismiss the appeal of the Revenue.
Issues involved:
Appeal against deletion of addition under section 69C of the Income Tax Act, 1961 for Assessment Year 2004-05. Analysis: The appeal was filed by the revenue against the order of the ld CIT(A)-XI, New Delhi for the Assessment Year 2004-05, where an addition of ? 4922700/- under section 69C was deleted. The assessee, a company, filed its return of income on 19.10.2004 for ? 36560010/-. The assessment was made on 20.12.2006 at ? 41624322/-. The coordinate bench directed the ld AO to examine the matter after conducting inquiries from the parties who sold property to the assessee regarding the discrepancy in the value stated in the sale deed for stamp duty purposes. The ld AO, after examining the matter, added ? 4922700/- as the market value of the land was considered higher. However, the ld CIT(A) deleted this addition. Upon careful consideration, the ld CIT(A) deleted the addition based on various grounds. He noted that no adverse findings were observed from the parties' replies during the AO's inquiries, confirming that the sale transactions were at the purchase price shown by the appellant. The ld CIT(A) emphasized that section 50C applied to the seller, not the buyer, and since the assessee was the buyer, income could not be added invoking this provision. Additionally, he clarified that section 56(1)(vii)(b) was not applicable for the relevant year. The ld DR failed to identify any flaws in the ld CIT(A)'s order. The tribunal concurred that there was no legal basis to add the difference between stamp duty value and transacted value in the hands of the buyer. Consequently, the tribunal upheld the ld CIT(A)'s decision and dismissed the revenue's appeal. In conclusion, the tribunal affirmed the deletion of the addition under section 69C for the Assessment Year 2004-05, emphasizing that the provisions of section 50C applied to the seller, not the buyer, and that no discrepancy was found in the sale transactions as per the inquiries conducted.
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