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TMI Blog2023 (3) TMI 666X X X X Extracts X X X X X X X X Extracts X X X X ..... nd, therefore, since the difference between the valuation for stamp duty and the actual consideration is less than 10%, which in the present case is 5.93%, no addition is called for. Accordingly, grounds taken by the assessee in this respect are allowed. - ITA No.484/Kol/2022 - - - Dated:- 13-3-2023 - Shri Rajpal Yadav, Vice President And Shri Girish Agrawal, Accountant Member For the Appellant : Shri Abhisek Bansal, Advocate For the Respondent : Shri Vijay Kumar, Addl. CIT ORDER PER GIRISH AGRAWAL, ACCOUNTANT MEMBER: This appeal filed by the assessee is against the order of Ld.CIT(A), National Faceless Appeal Centre (NFAC), Delhi vide Order No. ITBA/NFAC/S/250/2022-23/1043632005(1),dated 28.06.2022 passed against the assessment order by Income Tax Officer, National e-Assessment Centre, Delhi u/s. 143(3) read with sections 143(3A) 143(3B) of the Income-tax Act, 1961 (hereinafter referred to as the Act ) Act, dated 07.03.2021. 2. Assessee has taken seven grounds of appeal in which the moot point relates to addition made in respect of difference of stamp duty value and the actual consideration for which, in the given set of facts, whether it falls ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f Coordinate Bench of ITAT, Mumbai in the case of John Flower (India) Pvt.Ltd. in ITA No. 7545/Mum/2014 for AY 2010-11 dated 25.01.2017 wherein it was held that if the difference between the valuation adopted by the stamp duty valuation authority and that declared by the assessee is less than 10%, the same should be ignored and no adjustment shall be made. 3.4. Ld. CIT(A) sustained the addition made by the Ld. AO by observing that In view of the above provisions of the Act, it is evident that before the amendment w.e.f. 01.04.2019 (relevant to AY 2019-20), in the relevant assessment year 2018-19, even the five percent tolerance limit was not applicable. The appellant s submission that the amendment is retrospective in nature has no substance. It is to be noted that the five percent limit was further amended to ten percent w.e.f. 01.04.2021. Further, amendment w.e.f. 01.04.2021 made it abundantly clear that the five percent limit will be applicable only between AY 2019-20 to AY 2020-21. From AY 2021-22 onwards, the limit of ten percent is applicable. Hence, in the relevant year, the tolerance limit was only Rs.50,000/-. Aggrieved, assessee is in appeal before the Tribu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hout consideration, the aggregate value of which exceeds fifty thousand rupees, the whole of the aggregate value of such sum; (b) any immovable property, - (A) without consideration, the stamp duty value of which exceeds fifty thousand rupees, the stamp duty value of such property;- (B) for a consideration, the stamp duty value of such property as exceeds such consideration, if the amount of such excess is more than the higher of the following amounts, namely : (i) the amount of fifty thousand rupees; and (ii) the amount equal to [ten] per cent of the consideration. 6.2. We note that Finance Act, 2020 enhanced the tolerance band from 5% to 10% w.e.f. 01.04.2021. This issue has been elaborately dealt with by the Coordinate Bench of ITAT, Mumbai in the case of Maria Fernandes Cheryl (supra) which has been subsequently followed by the Coordinate Bench of ITAT, Kolkata in the case of Karb Associates Pvt. Ltd. (supra).Since we have nothing more to add or improve upon the observations and finding given by the Coordinate Bench of ITAT Mumbai, we extract the relevant observations and finding below for ease of reference: 7. The insertion of the th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e band. Once the Government acknowledged this genuine hardship to the taxpayer and addressed the issue by a suitable amendment in law, the next question was what should be a fair tolerance band for variations in these values. As a responsive Government, which is truly the hallmark of the present Government, even though the initial tolerance band level was taken at 5%, in response to the representations by the stakeholders, this tolerance band, or safe harbour provision, was increased to 10%. There is no particular reason to justify any particular time frame for implementing this enhancement of tolerance band or safe harbour provision. The reasons assigned by the CBDT, i.e., the variation between stamp duty value and actual consideration received can occur in respect of similar properties in the same area because of a variety of factors, including the shape of the plot or location, was as much valid in 2003 as it is in 2021. There is no variation in the material facts in this respect in 2021 vis- -vis the material facts in 2003. What holds good in 2021 was also good in 2003. If variations up to 10% need to be tolerated and need not be probed further, under section 50C, in 2021, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee. As has been aptly explained above, the rational for holding newly inserted proviso to subsection (1) to section 50C of the Act as curative in nature, hence, having retrospective application, the same analogy would apply to the provisions of Section 43CA of the Act. Both the sections are similarly worded except that both the sections have application on different sets of assessee. As has been pointed earlier, Section 43CA gets attracted where the consideration received or accrues as a result of transfer of an asset (other than a capital asset) being land or building or both. Whereas, provisions of section 50C operates where the consideration received or accrues as a result of transfer of a capital asset being land or building or both. Both the sections induce deeming fiction to substitute actual sale consideration with notional value of asset based on Stamp Duty valuation. Further, a perusal of Circular 8 of 2018 (supra) would show that identical reasons have been given in Para 16 for Rationalization of Sections 43CA and 50C . The proviso has been inserted and subsequently tolerance band limit has been enhanced to mitigate hardship of genuine transactions in th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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