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TMI Blog2019 (9) TMI 732X X X X Extracts X X X X X X X X Extracts X X X X ..... colourable device. We may also note that admittedly settlement was executed for distribution of different properties between the assessee and his brothers which was having no commercial purpose. It may also be noted here that authorities below rejected the claim of assessee because the transaction was not executed out of natural love and affection. The word natural love and affection have not been specified in Section 56(2)(vii)(b) of the I.T. Act. Therefore, this term has no consequence to the above provisions in which the A.O. made the addition. Since the amount of ₹ 12 crores have been taken by assessee as loan from the Bank through the respective agreements referred to above, therefore, it could not be treated as undisclosed income of the assessee. The assessee has explained source of ₹ 12 crores through the loan taken from the Bank. Therefore, provisions of Section 69B would not apply to the case of the assessee. Further, it was not the case of the A.O. that provisions of Section 69B are attracted in the case of assessee. CIT(A), could not have bring to tax the aforesaid amount through new source of income. Considering the above discussion in the light of a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 77; 4 crore is paid to each of three brothers in lieu of their relinquishing 1/3rd ownership in above bungalow, hence this transfer is for consideration and not out of love and affection . The A.O. noted that in the Memorandum of Family Settlement it is not clear about the actual price of the bungalow. Even if the price stated by the assessee in his submission is taken into consideration that it has been purchased by assessee from brothers for ₹ 12 crores, there is difference ₹ 28 crore as the stamp value determined by the Registrar for this property is ₹ 40.65 crores. It is also seen that the assessee has not objected to such valuation of Registrar and paid stamp duty. The A.O, therefore, noted that provisions of Section 56(2)(vii)(b) of the I.T. Act, 1961 are attracted and the exclusion provided in proviso to Section regarding relatives does not apply in this case. The A.O. accordingly, made addition of ₹ 28.65 crores under section 56(2)(vii)(b) of the I.T. Act, 1961. 4. The assessee challenged the addition before the Ld. CIT(A). The written submissions of the assessee is reproduced in the appellate order in which the assessee briefly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s bound to explain the source of investment in the property and will fall within the mischief of investment not fully disclosed in the books of account as per Section 69B of the I.T. Act, 1961. So, difference in the circle rate and investment of ₹ 12 crores shown by the assessee would still be taxable in his hand. The Ld. CIT(A), accordingly, dismissed the appeal of assessee. 6. We have heard the Learned Representative of both the parties and perused the material available on record. 7. Learned Counsel for the Assessee reiterated the submissions made before the authorities below. He has submitted that assessee has entered into Family Settlement Deed Dated 12.12.2014 PB-52 to show that assessee has 1/4th share only and no larger portion was acquired by the assessee. This Settlement Deed was executed between the assessee and three brothers. ₹ 12 crores was not paid by way of consideration to the brothers which is evident by this fact that the said amount of ₹ 12 crores was raised from the Bank after the Relinquishment of the Deed. Copy of the Release Deed Dated 18.12.2014 is filed at Page-10 of the PB in favour of the assessee showi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ved the property in question on account of Family Settlement. He has submitted that Bank loan of ₹ 12 crores is part of total amount of ₹ 20 crores which is mentioned in the Settlement Deed, therefore, the Ld. CIT(A) was not justified in giving adverse findings. As per the Settlement Deed, various properties after division have been allotted to assessee and his brothers and in exchange of these properties, each brother has received different properties. Therefore, none of the above provisions are applicable in the case of the assessee. It is not a colourable device at all. He has further submitted that ₹ 12 crores was taken as loan from the Bank which was given to three brothers, therefore, it would not be taxable under section 69B of the I.T. Act. He has further submitted that it is settled Law that Ld. CIT(A) cannot be bring to tax a new source of income which is not a case of the A.O, therefore, it was beyond the powers of the Ld. CIT(A) to reject the claim of assessee in alternate findings in the guise of apply Section 69B of the I.T. Act. In support of his contention, he has relied upon Judgment of Hon ble Delhi High Court in the case of Sardari Lal Co. 251 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion, the aggregate fair market value of which exceeds fifty thousand rupees, the whole of the aggregate fair market value of such property; (ii) for a consideration which is less than the aggregate fair market value of the property by an amount exceeding fifty thousand rupees, the aggregate fair market value of such property as exceeds such consideration : Provided that where the stamp duty value of immovable property as referred to in sub-clause (b) is disputed by the assessee on grounds mentioned in sub-section (2) of section 50C, the Assessing Officer may refer the valuation of such property to a Valuation Officer, and the provisions of section 50C and sub-section (15) of section 155 shall, as far as may be, apply in relation to the stamp duty value of such property for the purpose of subclause (b) as they apply for valuation of capital asset under those sections : Provided further that this clause shall not apply to any sum of money or any property received- (a) from any relative; or (b) on the occasion of the marriage of the individual; or (c) under a will or by w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (G) spouse of the person referred to in items (B) to (F); and (ii) in case of a Hindu undivided family, any member thereof;] (f) stamp duty value means the value adopted or assessed or assessable by any authority of the Central Government or a State Government for the purpose of payment of stamp duty in respect of an immovable property; 9.1. The above provision provides where an individual receives in any previous year, from any person or persons on or after 01.10.2009 any immovable property; (i) without consideration, the stamp duty value of which exceeds 50,000 rupees, stamp duty value of such property; (ii) for consideration which is less than the stamp value of the property by an amount exceeding 50,000 rupees, the stamp duty value of such property as exceeds such consideration shall be chargeable to Income Tax Act under the Head Income from Other Sources . However, the Second Proviso provides that this clause was not applied to any sum of money or any property received from (a) from any relative. The definition of Relative have been provided in Explanation-(e) to the aforesaid provisions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... crores to Group A was to equalize the inequalities in partition of the assets of M/s Hind Samachar Ltd. The amount so paid was immovable property. It was held that if such amount was to be treated as income liable to tax, the inequalities would set in as the share of the recipient will diminish to the extent of tax. Since the amount paid during the course of partition was to settle the inequalities in partition, therefore deemed to be immovable property. Such amount was not an income liable to tax. 9.3. In this case, since there was a Family Settlement between the assessee and three brothers and they have acted upon Family Settlement Deed and distributed various properties among themselves and necessary rights and title are transferred in favour of each brother would show that parties have entered into genuine transaction. As per the Family Settlement Deed, it was agreed that property in question with superstructure shall be taken by the assessee and that as per the Settlement Deed, the assessee has to contribute a sum of ₹ 20 crores from his own resources/ capital or through the borrowed funds as part of the Family Settlement to balance the settlement betw ..... X X X X Extracts X X X X X X X X Extracts X X X X
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