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TMI Blog2016 (9) TMI 1568X X X X Extracts X X X X X X X X Extracts X X X X ..... so, as rightly contended, the valuation adopted by the Stamp Valuation Authority cannot, by itself, be made the basis for reopening the concluded assessment. A mere adoption of higher value of the property by the Stamp Valuation Authority cannot lead to a formation of belief of escapement of income, particularly when the value so adopted is adopted for stamp duty purposes only. It is nowhere the case of the department that the AO had brought on record any tangible material whatsoever to suggest escapement of income, which could have, besides the Inspector s report, led to the formation of belief of escapement of income. It is trite, as also considered in the case of Income Tax Officer Vs. Shiv Shakti Build Home (P) Ltd. [ 2011 (2) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tax Act, 1961 is void ab-initio deserves to be quashed because the action has been taken on the basis of the provisions of Section 50C of the IT Act. 3. The modified additional ground is admitted as it is legal in nature and it is merely an expansion of the original ground No. 2. No fresh facts are required to be gone into for the adjudication of this modified additional ground, as the relevant material with regard to it already exist on record. 4. Apropos the merits of the modified additional ground, the ld. Counsel for the assessee has contended that the Assessing Officer reopened the completed assessment of the assessee only on having come to know about the sale of a plot by the assessee alongwith his wife; that it was on the bas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Stamp Valuation Authority determined the fair market value at ₹ 38,69,115/- (₹ 19,34,557/- attributable to the assessee); that moreover, the assessee did not dispute the fair market value before the ld. Assessing Officer; that as such, the ld Assessing Officer correctly treated the sale value to be that as determined by the Stamp Valuation Authority; and that, therefore, there being no merit in the modified additional ground, the same be rejected. 6. Having heard the rival contentions on this issue, I find that in this case, the ld Assessing Officer got information that the assessee had sold a plot of land alongwith his wife, for an apparent consideration of ₹ 10.00 lacs, whereas the Sub-Registrar had taken the val ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cted to the issue, cannot be said to be a sufficient reason for formation of belief of escapement of income; that there has to be a live nexus between the reason and the formation of the belief; that merely because the Stamp Valuation Authority has adopted a certain valuation for payment of stamp duty, the same cannot be a basis to conclude escapement of income in the hands of the purchaser, particularly when no tangible material had been brought on record to suggest the escapement of income, except the Inspector s report, which could not be relied on. The ITAT relied on the decision in the case of CIT Vs. D.N. Pachori (2010) 189 Taxman 420 (MP). 8. The present case is the case of a seller of property. However, the direct applicability ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the capital asset to a Valuation Officer and where any such reference is made, the provisions of subsections (2), (3), (4), (5) and (6) of section 16A, clause (i) of sub-section (1) and sub-sections (6) and (7) of section 23A, sub-section (5) of section 24, section 34AA, section 35 and section 37 of the Wealth-tax Act, 1957 (27 of 1957), shall, with necessary modifications, apply in relation to such reference as they apply in relation to a reference made by the Assessing Officer under sub-section (1) of section 16A of that Act. Explanation 1.- For the purposes of this section, Valuation Officer shall have the same meaning as in clause (r) of section 2 of the Wealth-tax Act, 1957 (27 of 1957). Explanation 2.- For the purposes of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 10. Thus, a mere adoption of higher value of the property by the Stamp Valuation Authority cannot lead to a formation of belief of escapement of income, particularly when the value so adopted is adopted for stamp duty purposes only. 11. Moreover, it is nowhere the case of the department that the Assessing Officer had brought on record any tangible material whatsoever to suggest escapement of income, which could have, besides the Inspector s report, led to the formation of belief of escapement of income. It is trite, as also considered in the case of Income Tax Officer Vs. Shiv Shakti Build Home (P) Ltd. , (supra), that there has to be a nexus between the formation of the belief and the alleged escapement of income. In the absence of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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