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TMI Blog2021 (6) TMI 614X X X X Extracts X X X X X X X X Extracts X X X X ..... t agreement dt. 6.03.2011 which was duly registered with the sub-registrar of Assurances, Mumbai and the said price was more than the ready reckoner rate prevailing on the date of the said agreement and the part consideration whereof has been received by mode other than cash which is in accordance with subsections 3 & 4 of sec.43 CA of the Act as they stood for the assessment year under appeal. 1.ii. Further in doing so, the Id. CIT (A) erred in holding that the appellant has not furnished any evidence of the rate at which the additional area was sold and the date on which such agreement was entered into which is against the material on record. 1.iii. In any event of the matter, as the stamp duty value was not in excess of 105% of the consideration received, the addition upheld by the Id. CIT(A) was not justified in view of the insertion of proviso to sub sec. 1 to sec. 43CA of the Act by the Finance Act, 2018 w.e.f. 1.4.19 which amendment being procedural & curative in nature has retrospective effect. Even if the said amendment is considered to be prospective in nature, still no addition could have been made as the difference between the stamp duty value and the consideration ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of Rs. 15000/- per square feet. The Stamp duty valuation would vary from year to year but the agreement value could not be changed. The provisions of Sec.43CA as inserted from financial year (FY) 2013-14 would not apply to sale agreement entered into during FY 2010-11. The details of sale agreement entered into by the assessee with respect to all the flats under consideration was furnished which has been extracted in para 5.4 of the assessment order. However, not convinced, Ld. AO added the difference of Rs. 6.18 Lacs to the income of the assessee u/s 43CA. 3. During appellate proceedings, the assessee reiterated that agreement value was much higher than the stamp duty value prevailing in the year of agreement. The rates were fixed as per the development agreement and the same could not be enhanced and higher prices could not be sought from the members. However, Ld. CIT(A) chose to confirm the action of Ld. AO, inter-alia, by observing that the assessee could not furnish any evidence of the rate for additional area to be purchased by the buyers and the date on which such agreement was entered in to ny the assessee. Further, there was no evidence that any payment was made in ear ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st to that date is Rs. 8,992/- per sq.ft. and, thus, reassessed the sale of each of the twelve flats. This basis of the nearest market rate is not found in his order. Therefore, on this basis itself the assessment is bad. In any case, Mr. Sharma, the learned Counsel for the Revenue submits that the market rate is the stamp duty rate of registration. Therefore, the stamp duty rate is used as a means to consider proper sales value of transfer of the flats. At the relevant time i.e. for the assessment year 2005-06, the only provision for application of deemed value for consideration was found under Section 50C of the Act relating to capital assets. At the relevant time there was no provision in the Act for deeming the consideration received on sale of goods/assets other than capital assets on the basis of stamp duty valuation. However, this provision in the form of Section 43CA of the Act has been introduced with effect from 1 April 2014. The present case pertains to the assessment year 2005-06. Therefore, Section 43CA of the Act will have no application for the subject Assessment Year. 13. In the case of CIT v. Neelkamal Realtors & Erectors India (P.) Ltd. [2017] 79 taxmann.com 238 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 14. The Division Bench of this Court in the case of Zain Constructions v. ITO [2019] 107 taxmann.com 300/265 Taxman 82 (Mag.) has conclusively decided the issue as under: "8. In our opinion, the entire approach of the Assessing Officer is wholly incorrect. As is well known, Section 50C of the Act would enable the Revenue to bring to tax by way of deemed capital gain difference between the stamp valuation and the sale price of a capital asset. For obvious reasons, this provision would not apply in case of a builder for whom such immovable property is in nature of stock in trade and not capital asset. To overcome this difficulty the legislature had inserted Section 43CA under Finance Act, 2013 w.e.f 1.4.2014. This provision would enable the Revenue to tax the income arising out of sale of stock by a deeming fiction where subject to certain conditions, stamp valuation of such stock would substitute the actual receipt thereof. In absence of any such statutory provisions, giving rise to the deeming fiction, the Revenue cannot tax any amount which has not been received by a seller of an immovable property at the time of sale." (Emphasis Supplied) No contrary decision is shown. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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