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TMI Blog2015 (7) TMI 734X X X X Extracts X X X X X X X X Extracts X X X X ..... ng the capital gain. In that situation, the AO would replace the sale consideration disclosed by the assessee by an amount on which stamp duty was paid by the assessee. Therefore, this section is of no help while determining the unexplained investment of the assessee. Thus Revenue authorities have failed to appreciate the facts and circumstances. The assessees have not made any unexplained investment in purchase of plots, and therefore, no additions deserve to be made. - Decided in favour of assessee. - ITA No.2567/Ahd/2011,ITA No.2571/Ahd/2011 - - - Dated:- 17-7-2015 - Shri Pramod Kumar and Shri Rajpal Yadav, JJ. For the Petitioner : Shri S.N. Soparkar For the Respondent : Shri J.P. Jangid, Sr.DR ORDER PER RAJPAL YADAV, JUDICIAL MEMBER: In the present appeals, separate orders of the CIT(A) dated 27.7.2011 passed on the respective appeals of the assessees for the Asstt.Year 2008-09, are being challenged. 2. Since a solitary question is being disputed by both the assessees, therefore, we heard both the appeals together and deem it proper to dispose of these appeals, by this common order, though, the assessees have taken five grounds of appeals, but, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed order. The learned AO did not accept the contentions of the assessee and made addition of ₹ 27,39,079/-. Appeal to the CIT(A) did not bring any relief to the assessee. 5. Now, we take the fact in the case of Shri Surehchandra S. Agrawal. 6. The assessee has filed his return of income electronically on 10.3.2009 declaring total income at ₹ 1,37,450/- and agriculture income of ₹ 3,72,562/-. The case of the assessee was selected for scrutiny assessment and notice under section 143(2) was issued on 1.9.2009, which was duly served upon the assessee on 3.9.2009. On scrutiny of the accounts, it revealed that the assessee has purchased six plots of land during the year. The learned AO has noted the details of transactions, exhibiting name of purchaser, name of seller, city survey no., area of plot, registration no. and the date of registration, vale as per sale deed, value as per Collector stamp duty, value as per authorized valuation officer. The learned AO further observed that out of six plots, the assessee has equal share in plots bearing at serial nos.3 and 6, and rest of the plots purchased in his exclusively ownership. The total value as per purchase deed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd to have made investment for purchase of plots. The next question is whether the assessees have made investment exceeding the amount recorded in the books. This is a crucial question, which demonstrates factual position. It is to be proved with the help of evidence available on record. According to the assessee, they have made investment in purchase of plots equivalent to the one disclosed in the sale deed. It is the AO who is disputing and harbouring a belief that the assessees have made investments, over and above, the amount so disclosed in the sale deed. His belief is based on the basis of stamp duty valuation which authorizes the valuation authorities to charge stamp duty on registering the transfer of plots. This type of evidence possessed by the AO is of not such a nature, which empowers him to invoke section 69B of the Act. Stamps duty paid by the assessee on purchase of land is a small portion of the total consideration, say, 8% or 10% of the total value. The assessee might have not disputed levy of that stamp duty on account of smallness of the amounts involved when compared to the litigation cost. But that does not mean that the assessee has accepted the valuation of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... no addition can be made u/s. 69B of the Act, 1961, but on the basis of sufficient material on record some reasonable inference can be drawn that petitioner has invested more amount than the shown in account books, then only the addition u/s. 69B can be made. The burden is on the Revenue to prove that real investment exceeds the investment shown in account books of the assessee. 15. In the case of ITO v. Harley Street Pharmaceuticals Ltd. [2010] 38 SOT 486 (Ahd) it has been held that provisions of Sec.50C are applicable only for computation of capital gains in real estate transaction in respect of seller only and not for the purchaser. Legal fiction cannot be extended any further and has to be limited to the area for which it is created. Section 50C creates a legal fiction for taxing capital gains in the hands of the seller and it cannot be extended for taxing the difference between apparent consideration and valuation done by Stamp Valuation Authorities as undisclosed investment u/s. 69. 16. The Co-ordinate Bench in the case of Dy. CIT v. Virjibhai Kalyan Bhai Kukadia [2012] 26 taxmann.com 13 (Ahd.) had on identical facts dismissed the appeal of the Revenue. 17. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... jantri rates and had made other references for arriving at the valuation. 10. In the above three decisions, it has been unanimously held that valuation made for the purpose of stamp duty is an estimated opinion. It can be a corroborative evidence for the help of the AO, but, it cannot be conclusive piece of evidence demonstrating the unexplained investment made by the assessee for purchase of land. Solely on the basis of such estimated opinion, the addition cannot be made. From perusal of record, we find that, apart from this estimated opinion, the AO was not possessing any other evidence. As far as reference made under section 50C of the Act is concerned, we are of the view that section 50C is deeming provision, which authorizes the AO to replace the sale consideration with regard to the full value of consideration disclosed by the assessee for the purpose of computing the capital gain. In that situation, the AO would replace the sale consideration disclosed by the assessee by an amount on which stamp duty was paid by the assessee. Therefore, this section is of no help while determining the unexplained investment of the assessee. 11. In view of the above discussion, we ar ..... 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