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TMI Blog2021 (2) TMI 318X X X X Extracts X X X X X X X X Extracts X X X X ..... nt facts of the case is the Karta, his individual capacity and the HUF itself. Therefore, the argument that, property received by HUF from its members, is not chargeable to tax. CIT(A) relied on provisions of section 50C to consider the value adopted by stamp duty authority on the date of agreement. This provision is applicable in case of recipient of sale consideration. Present case, assessee is the purchaser. We therefore reject applicability of Section 50 C to present facts. Revenue is therefore debarred to hold the transaction under section 56(2)(vii)(b) as taxable. We thus delete the addition sustained by Ld. CIT(A). - Decided in favour of assessee. - ITA No. 2058/Bang/2019 - - - Dated:- 19-1-2021 - B. R. Baskaran , Member (A) And Beena Pillai , Member (J) For the Appellant : K. Y Ningoj Rao , C.A For the Respondents : R. Premi , JCIT ORDER Per Beena Pillai, Member , JM Present appeal has been filed by assessee against order dated 20/08/2019 passed by Ld. CIT(A)-6, Mangalore for assessment year 2014-15 on following grounds of appeal: 1. That the impugned order of the Learned Commissioner of Income Tax (Appeals) 6, Bengaluru, the Respondent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Purchaser are the same and the said transfer is a transfer of asset between the relatives as contemplated under the Second Proviso to Section 56(2) of the Act. - ₹ 13,90,191/- - ₹ 13,90,191/-. 9. The Respondent erred in upholding the impugned assessment of ₹ 44,99,000/- as income of the Appellant with complete disregard to the fact that the Vendor and the Purchaser are the same and to the well-established principle of law that one cannot make profit of oneself. - ₹ 13,90,191/-. 10. The Respondent erred in upholding the impugned assessment of ₹ 44,99,000/- as income of the Appellant with complete disregard to the Guidance Value fixed by the Central Valuation Committee of Karnataka by its notification dated 17.4.2007 bearing No. CVC/BUD/5/2006-07 in force as up to 25.9.2011. - ₹ 13,90,191/-. 11. The Respondent erred in upholding the impugned assessment of ₹ 44,99,000/- as come of the Appellant with complete disregard to the decision of the Supreme in the case of SANJEEVLAL v. CIT 365 ITR 389 (SC).-₹ 13,90,191/-. 12. That the Respondent Officer erred in levying a sum of ₹ 4,48,866/- as the interest u/s. 234 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as dated 20/09/2011. Ld. AO observed that assessee paid sum of ₹ 98,15,000/- for the property and treated the difference of ₹ 44,99,000/- as undisclosed income in the hands. 5. Aggrieved by the addition, assessee preferred appeal before Ld. CIT (A). Ld. CIT (A) observed as under: 5.2.1 Grounds of appeal Nos. 2 to 4 are all related to the merits of the case and are hence taken up together. The appellant had erred into an sale agreement on 20/09/2011 with three vendors who had earlier entered into a joint development agreement with M/s. Gagan Construction and Apartments, the proprietary concern of the Kartha. Vide the agreement to sell, the appellant HUF agreed to purchase one flat No. 001 in the building being constructed pursuant to the JDA. The sale deed was subsequently registered on 26/07/2013. In the Statement of Facts, the appellant has submitted that while registering the sale deed the appellant was made to pay a stamp duty on value of ₹ 98,50,000/- by his advocate and also by the Sub Registrar, even though the agreed sale consideration ₹ 53,16,000/- represented the proper and adequate fair market value. The appellant has contended that as p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... asset, being land building or both, is less than the value adopted or assessed for assessable) by any authority of a State government (hereafter in this section referred to as the stamp valuation authority) 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 section 48, be deemed to be the full value of the consideration received or accruing as a result of such transfer: Provided that where the date of the agreement fixing the amount of consideration and the date of registration for the transfer of the capital asset are not the same, the value adopted or assessed or assessable by the stamp valuation authority on the date of agreement may be taken for the purposes of computing full value of consideration for such transfer. Provided further that the first proviso shall apply only in a case where the amount of consideration, or a part thereof has been received by way of an account payee cheque or account payee bank draft or by use of electronic clearing system through a bank account, on or before the date of the agreement for transfer. The sale agreement dated 20/09/2011 does n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd or building or both are sold or otherwise transferred, such transfer-shall be deemed to have taken place only after the stamp duty has been, assessed by the State Government, because it is on the valuation made for the purpose of stamp duty that the tax is payable under the Income-tax Act. The amendment made in the year 2009 may have made the things simpler, but the intention of the Legislature was very from the beginning that the value for the purpose of income tax shall be the same as the value Lot stamp duty. Therefore the AO's action in bringing to tax the difference between the amount mentioned in the sale deed and fair market value adopted by the stamp duty authority at the time of registration is justified. The addition made on, this account is upheld. These grounds of appeal are therefore dismissed. 6. Aggrieved by order of Ld. CIT(A) assessee is in appeal before us. 7. Ld. AR submitted that, all issues raised are in respect of addition of ₹ 44,99,000/- as income chargeable to tax under section 56(2)(vii) of the Act. 8. Ld. AR submitted that assessee pursuant to the agreement of sale dated 20/09/2011 agreed to purchase a residential flat in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... submitted that the value as per the said notification was ₹ 57,18,240/- on a composite bases. 14. Ld. AR submitted that assessing officer made addition in the hands of assessee under section 56(2)(vii) of the Act, as deemed income. He submitted that Ld. CIT(A) also invoked provisions of section 50C. 15. It has been submitted that, transaction does not fall within the provisions of section 56(2)(vii) of the Act, as assessee in capacity of HUF is the recipient of the property. Ld. AR referred to Clause (e) to 3rd Proviso to section 56(2)(vii)(b), to submit that, the definition of 'relative', in case of an HUF, is any member thereof. Ld. AR thus argued that, as per the definition of related as inserted by finance act 2012 with retrospective effect from 01/10/2009, where any an HUF receives in any previous year any money or property from any relative, the provisions shall not apply. It was also submitted that 50C is applicable in case of the seller, whereas, assessee in present case is the purchaser. 16. He thus prayed for the addition to be deleted on both these counts. 17. On the contrary Ld. Sr. DR placed reliance on orders passed by authorities below. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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