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TMI Blog2021 (8) TMI 804X X X X Extracts X X X X X X X X Extracts X X X X ..... tiated on the ground that value as shown by assessee and value as per stamp duty in respect of sale of property has escaped assessment which is not correct and thus simply on notional value proceeding as initiated u/s 148 is not the valid proceeding in the eyes of law. 4. Because in the facts and circumstances of the case the Assessing officer was wrong in determining the value of property at Rs. 92,37,000/- as per Section 50C as against 52 lakhs shown by the assessee and thus the addition as made on such basis on account of capital gain as per Assessing own working is highly unjustified. 5. Because in the facts and circumstances of the case both the two lower authorities failed to considered the issue of capital gains in an arbitrary manner and determined the capital gain at Rs. 9,04,580/- and his action as confirmed by CIT(A) is highly unjustified. 6. Because in the facts and circumstances of the case assessee reserved his right to take any fresh ground of appeal before hearing of appeal." 2. Ground no. 1 is regarding the validity of reassessment framed by the Assessing Officer under section 143(3) read with section 147 of the Income Tax Act. The learned AR of the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Income Tax Act. The Assessing Officer has not quantified the income assessable to tax that has escaped assessment while recording the reasons for reopening of the assessment. Therefore, in the absence of the quantification of the income at the time of recording the reasons, the Assessing Officer was not having a firm reason to believe that income assessable to tax has escaped assessment but the reopening is based on suspicion of escapement of income. In support of his contention, he has relied upon the decision of Hon'ble Jurisdiction High Court in case of Mahesh Kumar Gupta and Another vs. CIT and Another reported in 363 ITR 300. He has also relied upon the decision of Agra Bench of the Tribunal dated 19.06.2018 in the case of Smt. Usha Agarwal vs. Income Tax Officer in ITA No. 167/Agra/2018 and submitted that the Tribunal while following the decision of the Hon'ble jurisdiction High Court in the case of Mahesh Kumar Gupta and Another vs. CIT and Another (supra) has held that the so called reasons are no reasons in the eye of law and proceedings are initiated for verification based on pure conjucture and surmises. The reasons are based on incorrect assumption of fact and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9. The copy of the sale deed was furnished by the assessee. In the return of income, it was seen that the sale consideration was 52,00,000/- and the deductions u/s 48 were Rs, 48,60,961/- and exemption u/s 54F was claimed for Rs, 6,36,266/- and a long term capital loss of Rs. 2,97,227/- was declared. But on the perusal of the sale deeds (two separately, for commercial and for residential property respectively), it was seen that the sales were made for a total consideration of Rs, 42,00,000/- (25,00,000+17,000,000), but the valuation of the property for stamp purchases was Rs. 79,55,000/- (45,86,000+33,69,000). Hence, in view of the provisions of section 50C of the Income Tax Act, 1961, I have reason to believe that income has escaped assessment for the AY under consideration, and therefore, notice under section 148 is being issued." 8. It is apparent from the reasons recorded by the Assessing Officer for reopening of the assessment that the factum of transfer of property in question by the assessee was already came to the notice of the Assessing Officer during the assessment proceedings for the assessment year 2007-08 as the assessee received the advance towards the sale of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... kely to amount to rupees one lakh or more for that year; Explanation.- In determining income chargeable to tax which has escaped assessment for the purposes of this sub-section, the provisions of Explanation 2 of section 147 shall apply as they apply for the purposes of that section.] (2) The provisions of sub- section (1) as to the issue of notice shall be subject to the provisions of section 151. (3) If the person on whom a notice under section 148 is to be served is a person treated as the agent of a non- resident under section 163 and the assessment, reassessment or re-computation to be made in pursuance of the notice is to be made on him as the agent of such non- resident, the notice shall not be issued after the expiry of a period of six years from the end of the relevant assessment year." 9. Thus, the controversy before the Hon'ble High Court was regarding interpretation of section 149(1)(b) of the Income Tax Act and the finding of the Hon'ble High Court is also regarding the said provision. The Hon'ble High Court has finally held in para 15 and 16 as under:- "15. The only point urged and pressed before us is whether in absence of anything in the reasons rec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to determine the fair market value of the property in question as provided under section 50C(2) of the Income Tax Act. Once the assessee has raised the objection against the adoption of deemed full value consideration in terms of section 50C of the Income Tax Act, the Assessing Officer is duty bound to refer the matter to the DDO for determination of the fair market value of the property in terms of section 50C(2) of the Income Tax Act. Since, the Assessing Officer has not taken any step to determine the fair market value therefore, in the facts and circumstances of the case, this issue of fair market value of the property in question is set aside to the record of the Assessing Officer to refer the same to the DVO, and then be decided as per law, after giving an opportunity of hearing to the assessee. 14. Ground no. 2 is regarding ex parte order passed by the CIT(A) in view of the matter being set aside to the record of the Assessing Officer for determination of fair market value of the property the ground no. 2 of the assessee's appeal becomes infructuous and the same is dismissed. 15. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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