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TMI Blog2025 (4) TMI 1210X X X X Extracts X X X X X X X X Extracts X X X X ..... the case of assessee/petitioner no-2. The impugned orders were emanated from the order of the National e-assessment Centre, Delhi, order passed under section 143(3) read with section 143(3A) and 143(3B) of the Act, date of order 26/02/2021 in the case of assessee/petitioner no-1 and under section 143(3) read with section 144B of the Act, date of order 28/09/2021 in the case of assessee/petitioner no-2. 2. Both the appeals have same nature of fact and common issue. Therefore, both the appeals are heard together and are disposed of by this common order. ITA No.84/Mum/2025 is taken as lead case. ITA No.84/Mum/2025 2.1 The assessee has taken the following grounds of appeal: - "1. Under the facts and in law, the learned CIT(A) erred in conf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5 months in filing appeal before the ITAT is condoned and the appeal is taken for adjudication. 4. The brief facts of the case are that both assessee's, as co-owners, jointly purchased a residential flat in Kandivali West, Mumbai. The registration of the said flat was completed on 01.09.2017. The declared value of the property was Rs. 2,71,11,500/-, whereas the stamp duty valuation, as determined by the stamp duty authorities, stood at Rs. 2,88,91,540/-. Consequently, the difference amounted to Rs. 17,80,040/-. The Ld. AO considered 50% of the differential amount attributable to the assessee's share, which came to Rs. 8,90,020/-, and added the same to the assessee's income by invoking the provisions of Section 56(2)(x) of the Act. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g order. In any case, the said addition is not applicable for the petitioner no-2. 5. The Ld. DR vehemently argued and submitted that the said amendment, introduced by the Finance Act, 2020, became effective only from 01.04.2021. Accordingly, the tolerance limit of 10% would not be applicable to the impugned assessment year. The Ld. DR further pointed out that, in ITA No. 85/Mum/2025, the observation made by the Ld. AO regarding the assessee's half-share, calculated as 5% of the consideration amounting to Rs. 2,71,11,500/-, which comes to Rs. 6,77,787/was erroneous and contrary to the correct application of Section 56(2)(x) of the Act. While we acknowledge the fair findings of the Ld. DR in this regard. The Ld. DR nonetheless prayed for t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -2019 by the Finance Act 2018 allowed the tolerance band of 5%. It was held to be applicable retrospectively. Further, by the Finance Act 2020 with effect from 1-4-2021 in the same proviso the tolerance band is replaced by increasing it to 10%. Therefore, when there is no change in the wording of the proviso but only tolerance band is increased it should also apply retrospectively. 19. Coordinate bench in case of Maria Fernandes Cheryl (supra) has already held that the amendment made by Introducing proviso [Introduction of tolerance band of 5 % and later on 10%] applies with effect from 1-4-2003 when the provision of section 50C were introduced. 20. Further introduction of tolerance band is for removing the hardship in the section. once ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ge of sale instances would derive at the valuation at Rs. 6,65,90,250/-. We agree with the contention of the ld. Counsel that if the difference is less than 10% between fair market value and the sale consideration shown, then no addition should be made. This is so because third proviso to Section 56(2)(vii) provides reference to Section 50C for determining the valuation of the property of valuation officer. The third proviso to Section 50C provides that where the value adopted or assessed or assessable by the stamp valuation authority does not exceed 10% of the consideration received shall be taken as full value consideration i.e. if the difference is less than 10%, the same can be taken as share market value. Though this provision has been ..... X X X X Extracts X X X X X X X X Extracts X X X X
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