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TMI Blog2018 (9) TMI 1231X X X X Extracts X X X X X X X X Extracts X X X X ..... ile of the ld CIT(A) to determine the valuation of the two properties in terms of sub-section (3) as on the date of agreement to sell which is 9.4.2007 and where it is so determined that such valuation is higher than what has been declared by the assessee, the same can be brought to tax in the year under consideration. - decided in favour of assessee for statistical purposes. - ITA No. 470/JP/2018 - - - Dated:- 16-7-2018 - SHRI VIJAY PAL RAO, JM AND SHRI VIKRAM SINGH YADAV, AM For The Assessee : Shri G. M. Mehta (CA) For The Revenue : Shri J. C. Kulhari (JCIT) ORDER PER: VIKRAM SINGH YADAV, A.M. This is an appeal filed by the assessee against the order of ld. CIT(A)- 01, Jaipur dated 01.02.2018 pertaining to assessment year 2014-15 wherein the assessee has challenged the order of ld. CIT(A) in sustaining the addition of ₹ 20,38,324/- while invoking the provisions of section 43CA of the Act. 2. Briefly stated, the facts of the case are that the assessee company is engaged in business of developing and constructing residential/commercial property in Jaipur. During the course of assessment proceedings, the Assessing Officer observed that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er as the sale consideration in respect of two flats (Flat No. 3 and T-2 situated at Sapphire Heritage) were already taken into consideration in earlier years in its books of accounts and offered to tax when the entire consideration was received and the possession of the flats were handed over to the buyers on 28.06.2008 and 30.06.2010 respectively. It was submitted that in terms of provisions of section 2(47)(v) of the Act, the transfer was complete on these dates and therefore, the AO was not justified in invoking the provisions of section 43CA of the Act. 4. The ld. CIT(A) referred to the provisions of section 43CA inserted by Finance Act, 2013 w.e.f 01.04.2014 and the CBDT Circular No. 3/2014[F. No. 142/24/2013-TPL] dated 24.01.2014 and held that the said provisions are applicable from A.Y 2014-15 in cases where valuation of the property adopted by the stamp duty authorities is more than the sale consideration declared in the sale deed. It was held by the ld. CIT(A) that it is undisputed fact that the sale deeds in respect of Flat No. T-3 and T-2 were registered during year under consideration and therefore, the provisions of section 43CA are clearly applicable. It was furth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rther submitted that the purchase consideration of the two residential flats (stock in trade) was received as per following details: S. No. Details of sold properties Sale agreement possession date Sale consideration Payment details- i.e. amount, modes and dates 1. Flat No. T-2 Sapphire Heritage 9th April 2007 (possession handed over on 30.06.2010) Rs.26,36,000/ 09.04.2007 04.05.2007 30.06.2010 11 ,000 (Cash) 24,00,000(Cheq) 2,25,000(Cheq) 1. Flat No. T-3 Sapphire Heritage 9th April 2007 (possession handed over on 28.06.2008) Rs.27,00,000/ 09.04.2007 04.05.2007 28.06.2008 1,50,000 (Cash) 24,50,000(Cheq) 1,00,000(Cheq) It was further submitted that the assessee company had accounted for the sales of both the constructed residential units in financial year 2008-09 (A.Y. 2009-10) for which copy of return of income and relevant statements of accounts and details of sale of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d properties Registered on 1. Flat No. T-2 Sapphire Heritage 09.12.2013 2. Flat No. T-3 Sapphire Heritage 03.10.2013 It was submitted that the date of handing over of possession to both the buyers is appearing in the registered deed of sales and therefore sale is complete on that day. On the facts, both the lower Authorities were not justified in making/sustaining the additions in A.Y. 2014-15 by invoking provisions of section 43CA of IT Act more so when the sale of these flats were already accepted by ld. AO as per return of income for the A.Y. 2009-10 and both the Buyers recognized and accepted as owners by semi7 Government Department (Electricity Board) to whom electricity connections in their respective names was provided in the FY 2008-09. 7. The ld. DR vehemently argued the matter and took us through the findings of the lower authorities which we have already considered above. 8. We have heard the rival contentions and perused the material available on record. In the present case, the undisputed facts are that the assessee ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es of payment of stamp duty is higher than what has been agreed to between the assessee and the buyer and the exceptions provided under subsection (4) are not available to the assessee. 11. In order to appreciate the rival contentions, it would be appropriate to refer to the provisions of section 43CA of the Act which reads as under:- 43CA (1) Where the consideration received or accruing as a result of the transfer by an assessee of an asset (other than a capital asset), being land or building or both, is less than the value adopted or assessed or assessable by any authority of a State Government for the purpose of payment of stamp duty in respect of such transfer, the value so adopted or assessed or assessable shall, for the purposes of computing profits and gains from transfer of such asset, be deemed to be the full value of the consideration received or accruing as a result of such transfer. ( 2) The provisions of sub-section (2) and sub-section (3) of section 50C shall, so far as may be, apply in relation to determination of the value adopted or assessed or assessable under sub-section (1). ( 3) Where the date of agreement fixing the value of considerati ..... X X X X Extracts X X X X X X X X Extracts X X X X
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