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TMI Blog2024 (9) TMI 1188X X X X Extracts X X X X X X X X Extracts X X X X ..... d. Applicability of Section 56(2)(x) - On comparing both deed, the bench noted that the area and consideration in both deed are different and therefore, the contentions so as to non applicability of provisions of section 56(2)(x) as contended the deed itself does not matches and therefore, the contention raised by the assessee has been misplaced and misguided fact as argued by assessee. There is no reference of such deviation as to why the same has happened is not mentioned in the submission so filed. Had it been so the assessee should have clarified that the both the deeds relate to the same property - We not that the reference to the payment are also not dealt with the payment made. Even the details of the TDS deducted as per provision of section 194IA has not been placed on record even though as contended by the ld. DR. Assessee failed to convince that the agreement dated 10.04.2015 relates to the same property and therefore, provision of section 56(2)(x) should have not been applied and if so of 2015. But here the fact as discussed being different we are of the considered opinion that considering the facts available on record we do not find any merits to deviate from the findin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee. 4. On culmination of the assessment proceedings, the ld. PCIT called for examination the assessment records. Upon, examination the assessment record ld. PCIT noted that in this case, the ld. AO has not applied proper provisions of the Act on the income declared and offered in the return of income so filed. Therefore, ld. PCIT noted that the order is erroneous and prejudicial to the interest of revenue and the action was initiated by invoking the provision of section 263 of the Act by issuing a show cause notice as per provisions of 263 of the Act against which the assessee filed a detailed reply dated 17.03.2023. The ld. PCIT considered all the facts and circumstances as detailed in the reply filed by the assessee but not found the convincing and ld. PCIT thus held as under:- 15. As discussed above, the Assessing Officer failed to apply his mind on the material available on record and failed to invoke the applicable provisions of law. This in turn has resulted in passing of an erroneous order by the AO in the case due to non-application of mind to relevant material, an incorrect assumption of facts and an incorrect application of mind to the law which is prejudicial to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... part consideration has been paid otherwise than the cash. The assessment was completed under e-proceeding while accepting the income declared by the assessee accepting the explanation offered by the assessee. Later the ld. CIT again perused the assessment records and pointed out the same issue once again. It stated that the stamp duty value in the year of purchases (AY 2018-19) is at Rs. 8558500/- while the purchases is made at Rs. 6700000/- and hence Rs. 1858500/- is taxable u/s 56(2)(x) of the Act. The assessee explained the transaction through detailed submission (PB 1-2) however while making certain allegations it held that immovable property has been purchased by the assessee at a consideration which is less than the stamp duty value and as such the difference is taxable u/s 56(2)(x) of the Act. Accordingly the order passed by the ld. AO (NFAC) was held to be erroneous in so far as prejudicial to the interest of revenue and invoking the powers of sec.263 of the Act, the assessment was set aside to the AO to reassess the income. Now the assessee has filed this appeal. Our Submission: 1. Order of ld. Pr.CIT out of jurisdiction: At the outset, we may submit that the address of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the assessment was not prejudicial to the interest of the reveue which would be clear from the discussion made herein below. 1.4.1 Section 56(2)(x) has no application in the present case: It is submitted that on the basis of agreement the property was purchased in the year 2015 i.e. before 1-4-2017 and the copy of agreement has already been enclosed. It may further be noted that provisions of section 56(2)(x) under which the transaction is sought to be taxed came into existence w.e.f. 1-4-2017. For a detailed understanding, a reference may be made to the following decisions: Benudhar Gokulanand Biswal vs National E-Assessment Centre in ITA no.202/Mum/2023 dt.29-5-2023 (PB 81-89) 7. We find that the assessee has purchased the flat vide agreement dated 13.07.2009 and the section 56(2)(x) of the Act was not in the statute book, and also it is well settled principle of Law that a charging section cannot be pressed into service retrospectively unless it is specifically provided for by the legislature. The provisions of Sec. 56(2)(x) of the Act are incorporated in the Finance Act 2017 with the prospective applicability from A.Y.2017-18 and the transactions entered into prior to 1.04.2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eneral of Anit Dumping Allied Duties and Ors.:2017 (349) E.L.T 193 (SC), wherein it is held as under:- (i) The question raised or arising must have a direct and/or proximate nexus to the question of determination of the applicable rate of duty or to the determination of the value of the goods for the purposes of assessment of duty. This is a sine qua non for the admission of the appeal before this Court under Section 130E(b) of the Act. (ii) The question raised must involve a substantial question of law which has not been answered or, on which, there is a conflict of decisions necessitating a resolution. (iii) If the Tribunal, on consideration of the material and relevant facts, had arrived at a conclusion which is a possible conclusion, the same must be allowed to rest even if this Court is inclined to take another view of the matter. (iv) The Tribunal had acted in gross violation of the procedure or principles of natural justice occasioning a failure of justice. On perusal of the ratio of the judgments rendered by the Apex Court, it is held that if the learned ITAT, on consideration of material and relevant facts, had arrived at the conclusion which is a possible conclusion, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on has also been paid through cheque and hence covered by the above proviso. 1.6.1 Copy of agreement enclosed: We are enclosing herewith the copy of agreement dt.10-4-2015 (PB 56-61) between the builder and the assessee. It may be noted that the agreement duly witnessed by two witnesses and name and full addresses of witness are duly appearing on last page of the agreement. 1.6.2 Agreement not found to be false: It is important to note that the ld. Pr. CIT has not questioned the correctness or authenticity of the agreement anywhere in the order and as such the agreement has to be accepted as complete and correct and accordingly the assessee is eligible for the benefit of the proviso of section 56(2)(x) of the Act. 1.7 Consideration paid through cheque i.e. otherwise than by cash: The assessee made the following payments to the builder through account payee cheques: Sr. Date Cheque no. Name of bank/account no. Amount PB-cheque PB-bank statement 1 5-6-2014 207164 Axis Bank 909010035496123 1400000 70 63 2 4-7-2014 306821 Axis Bank 176010100194129 200000 71 66 3 10-8-2014 306826 Axis Bank 176010100194129 223000 72 67 4 2-11-2015 322612 Axis Bank 176010100194129 200000 - - Total Rs.2023 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... conclusions by the ld. PCIT: We may submit that while passing order u/s 263 of the Act, the ld. PCIT has made certain allegations, however the same are baseless and unsustainable in the eyes of the law. The table containing such allegations and our explanation is appearing below: Sr. Allegation/ Observation of ld. PCIT Explanation 1 In the agreement dt. 10-4-2015, there is mention of payment of Rs. 1326208/- but the assessee claimed payment of Rs. 1400000/-. Thus the claim of payment of Rs. 1400000/- not matching Rs. 1326208/- only refers to 20% of the purchases consideration which was determined at Rs. 6631040/- at the time of agreement as required to be paid before the date of agreement. This is clear from point no.1 at PB 58- 59. The assessee made payment of Rs. 1400000/- which is over and above the required payment and which included service tax and other charges which are to be paid over and above the consideration. In any case, the consideration has paid through account payee cheques and details have been submitted. These payments have nowhere been questioned and stands fully accepted Further the authenticity of the agreement also remain accepted and not questioned 2 Cheque h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sr. Particulars Pages 1 Copy of response submitted before the ld. PCIT dt. 17.03.2023 1-2 2 Copies of response submitted before the ld. ACIT (NFAC) dt. 05.02.2021 and 25.03.2021 3-5 3 Copy of contract of sale entered between Shiv Shakti Builders Developers and Arvind Kumar Agarwal dt. 31.01.2018 6-55 4 Copy of Agreement for sale entered between Shiv Shakti Builders Developers and Arvind Kumar Agarwal dt. 10.04.2015 56-61 5 Copy of bank account details of account no. 909010035496123 in case of Arvind Kumar Agarwal 62 6 Copy of bank account statements 63-69 7 Copies of cheques issued to builder i.e. Shiv Shakti Builders Developers 70-72 8 Copy of DLC rates for the year 2014 2015 73-74 9. PCIT vs. Naina Saraf in DB ITA No. 16/2022 dt. 09.05.2022 75-80 10. Benjudhar Gokulanand Biswal vs. National E assessment Centre in ITA No. 202/Mum/2023 dated 29.05.2023 (Mumbai. Trib.) 81-89 11. Sulochana Saijan Modi vs. ITO, National E-Assessment Centre, Mumbai in ITA No. 557/Mum/2023 dated 23.05.2023 90-107 7. The ld. AR of the assessee in addition to the above written submission so filed vehemently argued that the ld. PCIT has no jurisdiction to excise the power vested u/s. 263 of the Act as the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rk of the building/wing is presently completed upto Plinth/Slabs) for allotment of the said premises, agreed to be sold and allotted, by the Promoters to the Purchaser/sand Purchaser/s has/have agreed to pay to the Promoters the balance of the sale price/consideration in the manner, hereinafter appearing; aa. Under Section 13 of the said Act, the Promoters herein are required to execute a written Agreement for Sale of the said premises/unit with the Purchaser herein, being in fact these presents and also to registered this Agreement under the Registration Act, 1908. Now, for the agreement to be full-filled by the buyer and the payments mentioned to be made by Sh. Arvind Kumar Agrawal, the TDS as per Section 194 IA has to be made by Sh. Arvind Kumar Agrawal but no TDS details have been submitted to substantiate this stand. The Id. PCIT-1, Jaipur in para No. 11, 12 and 13 of the order u/s 263 at page '4 to 5' of the order has stated:- 11. Perusal of the agreement to sale dated 30.01.2018 shows that it is the registered document. As per the paragraph-11 of page-12 of the said document, an amount of Rs. 20,23,000/- is to be paid by way of earnest money/part consideration on or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n or before the date of unregistered agreement. So, the assessee is not entitled to take benefit of first proviso, which provides for adopting stamp duty value as on the date of unregistered agreement i.e. 10.04.2015. Accordingly, stamp duty value on the date or registered agreement i.e. 30.01.2018 is to be taken for purposes of section 56(2)(x). From these paras it is clear that payments were made by Ms. Tripta Agarwal though made from a joint account of Mr. Arvind Kumar Agrawal and Ms. Tripta Agarwal but since the person making the payment would deduct the TDS, hence, when Ms. Tripta Agarwal is making the payment, it connot be treated as payment made by Mr. Arvind Kumar Agrawal. 9. The ld. DR also supported that the payment made by the assessee to the builder not at time executing the agreement but it was beyond that date of agreement. The agreement mentioned in the 2018 has not correct reference of the earlier date wise payment and the even the agreement dated 2015 is silent. The assessee made the payment in 2014 entered into the agreement dated 10.04.2015 has no meaning as it is evident that the same is also not registered one whereas the agreement dated 31.01.2018 is registere ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding Car Parking. Whereas the subsequent agreement dated 31.012018 which is related to the year under consideration is extracted herein below; Extracted from the page 18 of the paper book u. On the application if the Purchaser/s herein, the Promoters have allotted to the Purchaser/s and the Purchaser/s has/have agreed to purchase from the Promoters a residential premises being Flat No. 1503 admeasuring 619 sq.ft i.e. 57.45 sq.mtrs. (carpet area as defined hereafter as per RERA) on 15th floor of the Wing B Wing in the building/project known as Tower-28 (for short the said Flat ) Annexed and marked Annexure D hereto being constructed by the Promoters on the portion of the said property at or for the lump sum consideration of Rs. 67,00,000/- (Rupees Sixty Sever lacs). On comparing both deed, the bench noted that the area and consideration in both deed are different and therefore, the contentions so as to non applicability of provisions of section 56(2)(x) as contended the deed itself does not matches and therefore, the contention raised by the assessee has been misplaced and misguided fact as argued by the ld. AR of the assessee. There is no reference of such deviation as to why the s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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