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TMI Blog2012 (12) TMI 337X X X X Extracts X X X X X X X X Extracts X X X X ..... between apparent consideration and valuation done by Stamp Valuation Authorities as undisclosed investment u/s. 69. AO has failed to bring on record any material to support the rates estimated by him. In favour of assessee - IT APPEAL NO. 369 (AHD.) OF 2010 - - - Dated:- 7-9-2012 - MUKUL KR. SHRAWAT AND ANIL CHATURVEDI, JJ. B.L. Yadav for the Appellant. R.N. Vepari for the Respondent. ORDER Anil Chaturvedi, Accountant Member - The Revenue filed appeal against the order of Ld. CIT(A)-V, Surat dated 30-10-2009 for the assessment year 2006-07. 2. The assessee is an Individual engaged in the business of diamond manufacturing and its import and export. The assessee filed his return of income on 15-3-2007 declaring ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed that provision of section 50C cannot be invoked to make addition u/s. 69B and the ingredients for invoking section 69B were absent. The assessee also relied on a number of judgments. The assessee further submitted that the instances relied upon by the A.O. cannot be compared for the reason that the land acquired by the assessee was agricultural land situated at a distance from the main city. The contentions of the assessee were not found acceptable by the A.O. The A.O. after considering the prevailing jantri rates, auction price of SUDA concluded that the price at which the sale deed were executed were quite low. In order to determine the correct value of the properties, the A.O. referred the matter to DVO. Since the case was getting tim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the books of accounts. The A.O. estimated the purchase price higher than what is shown by the appellant in the books of account. While estimating the purchase price, the A.O. has relied on some sale instances collected from SUDA and also the subsequent revised jantri fixed by the Government. 11. In my view, the burden is on the A.O. to prove that the amount expended in making investment in the property exceeds the amount recorded in the books. The A.O. relied on some sale instances with SUDA and estimated fair market price of land. Such presumption cannot be the basis for making the addition as the A.O. has not made any independent enquiry or collected corroborative evidences to justify the addition. The A.O. has failed to bring on recor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Stamp Duty Authorities. As stated by the A.O. the assessee purchased the land at Rs. 74 per sq. mtr. which was the prevailing jantry price. In view of this and in absence of fulfilling the basic requirements of section 69B. I am inclined not to agree with the addition made by the A.O. The A.O., is therefore directed to delete Rs. 83,27,600/- made under section 69B of the Act." 5. Aggrieved by the action of CIT (A), the Revenue is now in appeal before us. 6. Before us the Ld. D.R. submitted that the price at which the assessee had shown the purchase of land is far below the market rates and the Government rates. He further submitted that the market rate, the jantry rate and the auction price of SUDA gives a fair estimate of the preva ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y, or other valuable article, and the A.O. finds that the amount expended on making such investments or in acquiring such bullion, jewellery or other valuable article exceeds the amount recorded in this behalf in the books of account maintained by the assessee for any source of income, and the assessee offers no explanation about such excess amount or the explanation offered by him is not, in the opinion of the A.O., satisfactory, the excess amount may be deemed to be the income of the assessee for such financial year." 9. When we examine the provisions of Sec.69B, we find that section 69B is a deeming fiction. It is provided that addition can be made by the A.O. when the following three conditions are satisfied: (1) If it is found tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction price of SUDA and on that basis presumed that the amount expended is more than the amount recorded in the books. The A.O. has failed to bring on record any material to support his estimated price. 12. Section 50C is a deeming provision where under the stamp duty rate is treated as full value of consideration for the purpose of computing capital gain under section 48. It is applicable in the case of a seller of property and therefore cannot be invoked in case of purchaser of property for the purpose of section 69B. CIT (A) has given a finding that the A.O. has not made any independent enquiry or collected corroborative evidence to justify the addition. 13. In the case of CIT v. Naresh Khattar (HUF) [2003] 261 ITR 664 the Hon'ble De ..... X X X X Extracts X X X X X X X X Extracts X X X X
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