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TMI Blog2020 (2) TMI 1281X X X X Extracts X X X X X X X X Extracts X X X X ..... anted properties situated in slum areas, filed copies of sale deeds of properties in the similar vicinity at about the same time which were sold at price below the circle rate, also filed valuation report of registered valuer and the seller of the properties has appeared before the AO and has confirmed to have sold the property at the price mentioned in the sale deed only and there is no material available before the revenue authorities that assessee has paid anything more than what is mentioned in the sale deed, therefore, we are of the considered opinion that no addition is warranted in the instant case by invoking the provisions of section 69. We, therefore, set aside the order of the CIT(A) and direct the AO to delete the addition. The grounds raised by the assessee are accordingly allowed. X X X X Extracts X X X X X X X X Extracts X X X X ..... on of the building is very old. iii. The property was occupied by the tenants namely M/s Prem Sukh Dass Jawahar Lai since ages. There was a great element of risk involved in purchasing a property which is occupied by tenants. The assessee took a great risk in purchasing such a tenant occupied property. iv. The assessee got the property valued by a registered valuer whose report is annexed as per annexure 81 5. However, the AO was not satisfied with the explanation given by the assessee. He referred the matter to the DVO for obtaining a report on the valuation of the properties. He also confronted the seller of the properties and recorded the statement of Sh. Manoj Kumar Gupta u/s. 131 of the Act. After considering the report of the DVO and the statement given by one of the seller the AO made addition of ₹ 53,47,387/-being the difference in the purchase price and value reported by DVO in the case of property No.3402, Sita Ram Bazar and Circle Rate of the other property to the total income of the assessee by observing as under :- Value calculated as per Valuation Report of Property no. 3402, Sita Ram Bazar ₹ 15,23,450/- Purchase price of property shown by assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was called for. It is not as if the method adopted by the DVO is illegal. The DVO adopted the method which at the time of valuation was most suitable. As far as the statements of the sellers are concerned, both the sellers are the interested parties as if the accept to have received more consideration than reflected in the regd. Document, they will also be affected in the same proportion. So their denial is rejected. The appellant has also challenged the valuation report saying that the properties purchased were tenanted. Even Assessing Officer has not disputed this fact. In such a situation, the value of the property is bound to come down whether there was dispute between tenant and landlord or not, was of no consequence. Therefore, in my opinion rebate of 15% on this account is called for. The Assessing Officer is directed to give consequential relief." 8. Aggrieved with such order of the CIT(A), the assessee is in appeal before the Tribunal by raising the following grounds :- 1. That the order passed by the Ld. Commissioner of Income Tax (Appeals)-16 (Hereinafter Ld. Commissioner] is bad in law and against the provisions of The Income Tax Act (Hereinafter "Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he seller of both the properties i.e. Mr. Manoj Kumar Gupta who had categorically admitted that the properties were sold at price below the prevalent circle rates. Further there is no evidence in the possession of the revenue to prove that the assessee has paid something more over and above the sale consideration as mentioned in the sale deed. The basis of addition is only on the basis of the estimate made by the DVO in valuation report. He accordingly submitted that the addition made by the AO and sustained by the CIT(A) should be deleted. 11. The Ld. DR on the other hand heavily relied on the order of the CIT(A). 12. We have considered the rival arguments made by both the sides, perused the orders of the AO and the CIT(A) and the paper book filed on behalf of the assessee. We have also considered the various decisions cited before us. We find the AO in the instant case made addition of ₹ 53,47,387/- being the undisclosed investment u/s.69 of the Act on the ground that assessee has purchased two properties for ₹ 20 lacs whereas the value determined by the valuer in one of the properties is ₹ 15,43,450/- and the circle rate of the other property is ₹ 58,23 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... statement of the seller of both the properties wherein he has categorically admitted by stating the reasons for selling the property at price below the prevalent circle rates. Further nothing has been brought on record to prove that the assessee has paid anything extra over and above the value of agreement in any other form of consideration. Nothing has been brought on record that money has emanated from the assesee's coffers. The sole reliance in the instant case is the basis of estimates made by the DVO in the valuation report. It has been held in various decisions that additions cannot be made on the basis of surmises and conjectures in the absence of any tangible material on record. Since in the instant case assessee has purchased old tenanted properties situated in slum areas, filed copies of sale deeds of properties in the similar vicinity at about the same time which were sold at price below the circle rate, also filed valuation report of registered valuer and the seller of the properties has appeared before the AO and has confirmed to have sold the property at the price mentioned in the sale deed only and there is no material available before the revenue authorities that a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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