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TMI Blog2019 (8) TMI 502X X X X Extracts X X X X X X X X Extracts X X X X ..... rket value. b) The difference between the market price and the transaction value is the gift made by the assessee to his relative. c) The relative is covered u/s 56(2)(vi) of the Act. d) The affidavit filed by the appellant, explaining that the transaction was a gift was ignored by CIT(A). 3. Briefly stated, the facts are that the assessee filed his return of income for the assessment year (AY) 2013-14 on 03.01.2014 declaring total income of Rs. 3,48,000/-. During the course of assessment proceedings, the Assessing Officer (AO) noticed that the assessee has not shown any capital gains from sale of property ; however, as per ITS details, the assessee had sold an immovable property for Rs. 28,00,000/- under the registration No. 2982/2012 and the stamp valuation of the property was Rs. 41,64,500/-. In response to a query raised by the AO to explain why provisions of section 50C should not be applied in this case, the assessee filed the copy of the sale agreement and purchase agreement along with computation of capital gains and explained that the accountant, through oversight, missed out on including the capital gains while filing the return of income, as the assessee was out o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Ld. CIT(A) held: "5. I have considered the submissions of the appellant as well as order u/s 143(3) of the IT. Act. In the assessment order, the Long Term capital gain was computed on sale of flat as per provisions of Section 50C and subjected to tax by the AO. The assessee did not offer any capital gain on sale of the said flat in its return of income. As per deed of transfer [conveyance deed], the premises have been sold and transferred for the price of Rs. 28,00,000/-. The transferees have paid in full to the transferor before the execution of the transfer deed. The stamp duty and registration charges payable on the deed of transfer was borne and paid by the transferees which is the norms in any sale transactions. Therefore, to hold the transaction as gift even partially is not at all justified from any angle. In a gift, there is no role of any price or consideration. The plea of partial gift and partial sale is just an after-thought and chance taken by the assessee to minimize the tax liability after being caught. As per transfer deed, the entire price of the premises was paid by the transferees. Therefore, nothing is left to be gifted. The tax liability arises because o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f partial gift and partial sale is just an afterthought. As per the transfer deed, the entire price of the premises was paid by the transferees and there is nothing left to be gifted. Thus the Ld. DR submits that the order passed by the Ld. CIT(A) be affirmed. 7. We have heard the rival submissions and perused the relevant materials on record. The reasons for our decision are given below. In the instant case, the assessee has transferred to his relative 'Flat No.804' for sale consideration of Rs. 28,00,000/-. As admitted by the assessee in the 'statement of facts' filed before the Ld. CIT(A) along with Form No. 35 dated 11.02.2016, his accountant erroneously omitted to record the said entry in his books of accounts and hence the same could not be offered to tax while filing the return of income on 03.01.2014. As per the deed of transfer dated 11.04.2012, the assessee (transferor) sold the above immovable property to Smt. Nilufer Casmiro Lobo & Shri Casmiro Leopold Lobo (the transferees) for a sum of Rs. 28,00,000/-. The assessee received from the above transferees a sum of Rs. 3,00,000/- on 27.02.2012 by 2 cheques both dated 27.02.2012 No. 113041 and 113042 drawn in favour of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from any relative [as defined]; or b. on the occasion of the marriage of the individual; or c. under a will or by way of inheritance; or d. in contemplation of death of the payer. e. from any local authority as defined in the Explanation to section 10(20); or f. from any fund or foundation or university or other educational institution or hospital or other medical institution or any trust or institution referred to in section 10(23C); or g. from any trust or institution registered under section 12AA. According to the Explanation to section 56(2)(vi), the term 'relative', for the purposes of that section 56(2)(vi), means- i. spouse of the individual; ii. brother or sister of the individual; iii. brother or sister of the spouse of the individual; iv. brother or sister of either of the parents of the individual; v. any lineal ascendant or descendant of the individual; vi. any lineal ascendant or descendant of the spouse of the individual; vii. spouse of the person referred to in clauses (ii) to (vi). We are concerned here with AY 2013-14. 7.2 The assessee in the present case has filed an affidavit dated 12.05.2017 stating therein that he had gifte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and shall be deemed to be the income of the previous year in which transfer took place unless such capital gain is exempt under provisions of the Act. 7.5 The contentions of the assessee are that provision of section 50C is not applicable because (i) he has transferred the above immovable property to one of his relative and (ii) the difference between the transaction value and stamp duty value is the gift made by the assessee to the relative. The above contentions are farfetched because the assessee has not filed any gift deed either before the AO or CIT(A) or the ITAT. The attempt to rope in section 56(2)(vi) by the assessee fails because there is no gift deed. All the more, as mentioned earlier, the assessee had not disclosed any capital gains from the sale of the above property. Only after the AO noticed that the assessee had sold an immovable property as per ITS details for Rs. 28,00,000/- under Registration No. 2982/2012 and issued a notice u/s 142(1) dated 11.09.2015 and thereafter followed it on 16.11.2015, the assessee filed a revised computation of income working out the capital gains i.e. LTCG at Rs. 13,11,224/- and claimed that provisions of section 50C is not applicab ..... X X X X Extracts X X X X X X X X Extracts X X X X
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