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TMI Blog2024 (11) TMI 1258X X X X Extracts X X X X X X X X Extracts X X X X ..... value for persuasion and it does not partake the value of direction. Invoking of section 56(2)(vii)(b)(ii) - CIT (A) in AY 2014-15 even though after giving proper finding that the transaction under consideration is pertained to AY 2013-14 merely because the registration of the transaction was made in AY 2014-15 it does not change the character of the transaction and it belongs/pertains to AY 2013-14 only. The provisions of section 56(2)(vii)(b)(ii) of the Act was amended w.e.f. 01.04.2014. The ld. CIT (A) cannot invoke the provisions of section 56(2)(vii)(b)(ii) of the Act on the transactions pertaining to previous assessment year, as held in the case of M. Syamala Rao [ 1998 (4) TMI 113 - ANDHRA PRADESH HIGH COURT] Therefore, in our considered view, transaction under consideration pertained to AY 2013-14 and ld. CIT (A) cannot treat this transaction as pertains to AY 2014-15 and also cannot invoke provisions of section 56(2)(vii)(b)(ii) of the Act which was amended w.e.f. 01.04.2014 effective from AY 2014-15. Accordingly, we delete the additions made by ld. CIT (A) by invoking the provisions of section 56(2)(vii)(b)(ii) of the Act. - Shri S. Rifaur Rahman, Accountant Member And ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Assessing Officer was not convinced with different versions of sources and justification submitted by the assessee, he rejected various submissions of the assessee and proceeded to make the addition u/s 69 of the Act. Further he added stamp duty of Rs. 6,54,050/-. 3. Aggrieved assessee preferred an appeal before the ld. CIT (A)-13, New Delhi. Before ld. CIT (A), ld. AR for the assessee submitted that Rs. 70,00,000/- was paid by the assessee in the following dates :- (i) On 25.12.2012 Rs. 13,00,000/- in cash; (ii) On 12.01.2013 Rs. 30,00,000/- vide cheque no.012344 of Allahabad Bank; and (iii) On 12.01.2022 Rs. 27,00,000/- vide cheque no.012345 of Allahabad Bank. It was also submitted that physical possession of the property was taken on 17.01.2013. Ld. CIT (A), after perusing the documents and explanation submitted by the assessee, observed as under :- 1) The payment of Rs. 30 lacs Rs. 27 lacs by cheque are being supported by Xerox copy of cheques, but they do not show the cheque no. i.e. 012344/012345 as stated in various places. 2) The appellant claims to have been given an amount of Rs. 25 lacs by her husband Sh. Raj Kumar. The source as per his confirmation states that he rec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... allowed the deduction claimed by the assessee of Rs. 55,600/- under Chapter-IVA of the Act. 7. Aggrieved with the above order, assessee is in appeal before us raising following grounds of appeal :- 1. On the facts and circumstances of the case and in law, the Learned Commissioner (Appeals) has exceeded its authorities in issuing direction to re-open the assessment of earlier year when the cash credit has taken place. 2. Whether the CIT ( Appeals) was justified in bringing to tax Rs. 93,50,103/- (Rs. 1,63,50,103/- - Rs. 70,00,0001- difference between circle rate and purchase consideration) u/s 56(2)(vii)(b )(ii)' of the IT Act particularly when the Ld AO order did not mention any thing about the addition u/s 56(2) and was empower to re-assess the case on the direction of seniors 3. On the facts and circumstances of the case and in law, the Commissioner of Income Tax (Appeal) erred in confirming the addition of Rs. 93,50,103/- (Rs.1,63,50,1031- - Rs. 70,00,0001-) u/s 56(2)(vii)(b )(ii) of the IT Act made by the assessing officer u/s 69 of the Act the reasons given by CIT(A) for confirming the said additions are erroneous and not sustainable both on facts and in law and according ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of Rs. 93,50,103/- being the difference of circle rate and actual purchase price. In this regard, he brought to our notice pages 116 to 119 of the paper book. He submitted that section 56(2)(vii)(b)(ii) of the Act was amended to provide sub-clause (ii) of the Finance Act, 2013 w.e.f. 01.04.2014. He brought to our notice the extracts from the Memorandum of Finance Bill reported in 351 ITR 164 (185). He submitted that the above amended section has no application for the present issue under consideration. Since ld. CIT (A) himself has given a finding that the present transaction belongs to AY 2013-14 and mere registration was made in the later date would not cover the transaction already exhibited in the earlier year where substantial obligation found already discharged. He relied on the case of Pr.CIT vs. Naina Saraf 142 taxman.com 147 (Rajasthan HC). He further submitted that date of registration i.e. 09.04.2013 shall relate back to the date of agreement to sale of property, which can also be an oral agreement or date of first payment which is evident not only from sale deed but also from findings of first appellate authority. He submitted that once the payment of consideration ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... addition. He further submitted that it is pertinent to note that addition of Rs. 1,63,50,103 has been made by Assessing Officer invoking provisions of section 69 of the Act, of which addition to the extent of Rs. 70,00,000/- was deleted by first appellate authority (Although issued direction for assessment in different year), further the addition of Rs. 93,50,103/- (Rs.1,63,50,103 - Rs. 70,00,000) is made by first appellate authority invoking section 56(2)(vii)(b )(ii) of the Act. Ld. AR relied on the order of ITAT Delhi 'SMC' Bench in the case of M/s Toffee Agricultural Farms Ltd in ITA no. 4903/Del/2019 dated 18.04.2022 (Page 34-41 of paper book) wherein it has been held that the CIT(A) could not change the provision of law qua the item of which assessment is made, relevant portion from the order is extracted hereunder :- 6. Now coming to the question regarding action of the learned CIT(Appeals) to treat the reference u/s 142 for the purpose of Section 69B, I find merit into the contention of the assessee that there is no power conferred upon the learned CIT(Appeals) to assess a particular item under different provision of the Act what the Assessing Officer had done witho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) Hari Mohan Sharma vs. ACIT 179 ITD 310; (ii) CIT vs. Rai Bahadur Hardutroy Motilal Chamaria 66 ITR 443; (iii) CIT vs. Union Tyres 240 ITR 556; (iv) CIT vs. Sardari Lal Co. 251 ITR 864; (v) CIT vs. B.P. Sherafudin 399 ITR 524 (Ker); (vi) Nababharat Shiksha Parishad vs. DCIT in ITA No.163/CTK/2015 dated 11 October 2017; (vii) Naresh Sunderlal Chug vs. ITO 171 ITD 116; (viii) Tulsi Tracom (P) Ltd. vs. CIT6 86 taxmann.com 35; (ix) Cairn India Ltd. vs. DIT (IT) 87 taxmann.com 310 (Madras); (x) J.T. (India) Exports and Anr. Vs. UOI 262 ITR 269 (FB) (Del.). 13. With regard to addition of stamp duty, ld. AR submitted that assessee prefers not to press this ground. 14. On the other hand, ld. DR for the Revenue submitted that ld. CIT (A) has right to dispose of the issue under dispute as per section 251 Explanation, therefore, ld. CIT(A) can modify the section to sustain the addition which is within his powers. He submitted that section 56(2)(vii)(b)(ii) of the Act is applicable w.e.f. 01.04.2014, therefore, the registration was completed by making the payment of stamp duty on 05.04.2013. Ld. CIT (A) has already deleted the addition, however stamp duty is paid in AY 2014-15, therefore prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... property with effect from May 1, 1962. If the assessee is the owner of the property with effect from May 1, 1962, the capital gains cannot be said to be short-term capital gains as the assessee has already held the property for more than thirty-six (36) months. In our view, therefore, the view expressed by the Tribunal that the capital gains are short-term capital gains is not correct. In the light of the above, we answer the question in the negative and in favour of the assessee. The referred case is accordingly answered. No costs. 17. Therefore, in our considered view, transaction under consideration pertained to AY 2013-14 and ld. CIT (A) cannot treat this transaction as pertains to AY 2014-15 and also cannot invoke provisions of section 56(2)(vii)(b)(ii) of the Act which was amended w.e.f. 01.04.2014 effective from AY 2014-15. Accordingly, we delete the additions made by ld. CIT (A) by invoking the provisions of section 56(2)(vii)(b)(ii) of the Act. 18. Since assessee is not pressing ground no.5 of stamp duty, the same is dismissed as not pressed. 19. In the result, the appeal filed by the assessee is partly allowed. Order pronounced in the open court on this 26th day of Novemb ..... X X X X Extracts X X X X X X X X Extracts X X X X
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