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TMI Blog2021 (10) TMI 271X X X X Extracts X X X X X X X X Extracts X X X X ..... so, we cannot give any credence to this agreement, though it was in writing. The plea of the assessee that transfer having taken place earlier to execution and registration of sale deed cannot be appreciated - the assessee has actually has executed the transfer of impugned property only through Sale Deed dated 23.11.2015, as such the AO rightly applied the valuation as applicable on this date. We do not find any infirmity in the order of the lower authorities and the same is confirmed.- Decided against assessee. Addition u/s. 68 - assessee has shown cash deposit into bank account for the demonetization period from 9.1.2016 to 30.12.2016 - Assessee submitted assessee availed the following loans and deposited into the bank account and withdrawn the same for redeposit into bank account - HELD THAT:- As submitted cash book filed before us to show that it was duly reflected in the cash book and redeposited in the bank account. In our opinion, these are additional evidence to be examined at the end of the AO. Therefore, we set aside the orders of lower authorities and remit the issue to the AO for re-examination and fresh decision in accordance with law. - Decided in favour of asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5. In the application under Rule 29 of the Appellate Tribunal Rules, 1963 the assessee has submitted that due to inadvertence the above documents were not filed before the lower authorities and prayed for admission of the same. We have gone through the additional evidence and admit the same for the purpose of adjudication. 6. The assessee submitted that the assessee entered into agreement for of sale of property on 3.6.2013 under which the property was agreed to be sold by the assessee for a consideration of ₹ 48 lakhs out of which ₹ 51,000 has been received by the assessee as advance in cash from the Purchaser. According to the assessee, the transfer took place vide sale agreement on 3.6.2013 and not vide Sale Deed dated 23.11.2015. He placed reliance on section 47 of the Indian Registration Act, 1908 which provide that registered document shall operate from the time when it would have commenced to operate, if no registration thereof had been required or made, and not from the time of its registration. According to him, in the assessment year under consideration the provisions of section 50C cannot be invoked. For the purpose he relied on the ord ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g land or building or both, is less than the value adopted or assessed [or 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. Sec.50C of the Act substitutes the full value of consideration received or accruing on transfer which otherwise would be the value as envisaged u/s.48 of the Act. Sec.50C of the Act is therefore an exception to Sec.48 of the Act in certain circumstances. Section 50C of the Act does not operate to change the year of transfer as laid down in section 45(1) of the Act. 10. Section 45 of the Act is a charging section as far as capital gain on transfer of capital asset is concerned. Section 48 is a machinery or computation provision. A transaction to which those provisions cannot be applied must be regarded as never intended by Section 45 of the Act to be a subject of charge. This inference flows from the general arrangement of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... computation provision. And ordinarily the operation of the charging provision cannot be affected by the construction of a particular computation provision. But the question here is whether it is possible to apply the computation provision at all if a certain interpretation is pressed on the charging provision. That pertains to the fundamental integrality of the statutory scheme provided for each head. (emphasis supplied) The reverse inference that can be drawn on the basis of the aforesaid observations underlined, is that if there is no charge to tax on capital gain in AY 2011-12 u/s.45(1) of the Act, the computation provision u/s.48 of the Act, cannot operate to create a charge. 11. The decision referred to by the learned Counsel for the Revenue of the Calcutta High Court is on different facts and not applicable to the present case. In the case of Bagri Impex (P.) Ltd. v. Assistant Commissioner of Income-tax, Circle-9, Kolkata, (2013) 31 taxmann.com 39 Calcutta, the facts were that the Assessee was owner of 2/5th share in a land situate at Kolkata. The case of the assessee was that the land in question or the interest of the assessee was agreed to be sold on 15th Octob ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase of the assessee was that the provision of Section 50C has no manner of application because on the date when he received the money by way of sale proceeds neither the deed of conveyance had been executed and naturally it could not have been registered on that date. The Hon ble Calcutta High Court had to decide the following substantial question of law: viz., Whether, on the facts and circumstances of the case, the learned Tribunal was justified in law in not considering that the words or assessable was introduced in section 50C(1) of the Income Tax Act, 1961 with effect from 1st October, 2009 and thus erred in taking the value of the capital asset as assessed by the Stamp Valuation Authority on 27th November, 2007 instead of actual transfer price for the relevant assessment year 2006-07? The Court held as follows: 7. We have not been impressed by this submission. It is true that 'Transfer' has been defined in Section 2(47) quoted above. But the aforesaid definition was made before Section 50C was introduced to the Income Tax Act. After section 50C was introduced in the year 2003, the value of the land or building or both sold or otherwise transferred ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9, it is only cases where the valuation is completed in the relevant AY that provisions of Sec.50C of the Act can be applied. In the present case, no such devise to evade tax has been pleaded by the revenue nor a plea has been taken by the Assessee that sale having taken place earlier to the execution or registration of sale , provisions of Sec.50C of the Act are not applicable. As rightly contended by the learned Counsel for the assessee, it was a decision rendered on the scope of amendment to section 50C of the Act w.e.f. 01.10.2009. 13. The decision referred to by the learned DR in the case of J.Appa Rao(supra) is a case where it was held that applicability of the provisions of Sec.50C of the Act is mandatory w.e.f .1-4- 2003. This decision does not in any way support the case of the revenue regarding the year in which capital gain is liable to be taxed. 14. For the reasons given above, I hold that the capital gain in question cannot be brought to tax in Assessment Year 2011-12. The Revenue authorities erred in bringing to tax the capital gain in Assessment Year 2011-12. The addition made by the AO is accordingly directed to be deleted. 15. In the result, appeal b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mp valuation it is ₹ 33,48,284/- which is less than 10% of the stamp duty valuation of the said plot. Therefore, in view of the ratio of the decisions relied on by the assessee, the assessee should succeeded in its appeal. The Jaipur Bench in the case of Smt. Sita Bai Ketan (Supra) held as under:- 4.2 We have heard rival contentions and perused the material available on record We find that the Hon'ble coordinate Bench in ITA No. 1.543/PN/2007 in the case of Rahul Constructions Vs. DCIT (Supra) has held as under:- We find that the Pune Bench of the Tribunal in the case of Asst. vs. Harpreet Hotels (P) Ltd. Vide ITA No. 1156- 1160/Pn/2007 and relied on by the learned counsel for the assessee had dismissed the filed by the Revenue where the CIT(A) had deleted the Unexplained investment in house construction on the ground that the difference between the figure shown by the assessee and the figure of the DVO is hardly 10 per cent. Similarly, we find that the Pune Bench of the Tribunal in the case of ITO vs. KaadduJayghoshAppasahebh, the learned counsel for the assessee following the decision of the J K High Court in the case of Honest Group of Hotels (P) Ltd. Vs, U ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the assessee. Accordingly, we modify the order passed by Ld. CIT(A) and direct the A.O. to ignore the difference between fair market value determined by CIT(A) and the actual consideration as the same is less than 10% of the actual consideration. 12. In the result, the appeal filed by the assessee is allowed. 8. On the other hand, the ld. DR submitted that the sale agreement produced before the lower authorities dated 13.6.2013 cannot be relied upon wherein the assessee received ₹ 51,000 by way of cash out of sale consideration of ₹ 48 lakhs. Further he submitted that payment shown in the sale agreement at ₹ 51,000 which proves that this agreement is not genuine which was executed on ₹ 2/- non-judicial stamp paper. According to him, it is a made believe story which cannot be given any credence to hold that assessee entered into sale agreement with the buyer on 3.6.2013. He relied on the orders of lower authorities. 9. We have heard both the parties and perused the material on record. The first proviso to section 50C of the Act reads as follows:- Provided that where the date of the agreement fixing the amount of consideration and th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Date of loan Loan amount Outstanding as on 31.3.16 Mode of loan taken Purpose of loan 1 Karnataka Credit Co-op. Bank 402 30.12.20 20,00,000 20,00,000 Ch No.850413 Family and/or business 2 Shree Samarth Finance CD/28/15 26.05.2015 5,00,000 5,00,000 Transfer Family and/or business 3 Suvarna Financers Invest Corp CD/113/15 30.11.2015 5,00,000 5,00,000 Transfer Family and/or business 4 Suvarna Financers Invest Corp CD/119/15 17.12.2015 6,00,000 6,00,000 Transfer Family and/or business ..... X X X X Extracts X X X X X X X X Extracts X X X X
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