TMI Blog2002 (12) TMI 615X X X X Extracts X X X X X X X X Extracts X X X X ..... e market value was only ₹ 76,000 and restricting the addition to the total income of the assessee to ₹ 36,000 as against the addition of ₹ 1,67,000 made by the assessing authority? 2. The assessee, an individual, entered into an agreement of sale on 21st Feb., 1983, with one Arumugam for purchase of land in an extent of 0.75 acres with an uncompleted structure of Cinema Theatre for a total consideration of ₹ 2,07,000. The said agreement was seized by the Revenue in the course of search conducted. The sale deed was registered on 2nd March, 1983, for a consideration of ₹ 40,000. The assessee claimed that the expenditure laid out was only ₹ 47,000, which includes the sale consideration of ₹ 40,000 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a sum of ₹ 40,000. He further highlighted that as per the agreement the assessee has paid a sum of ₹ 45,000 as advance which is more than the total consideration as stated in the sale deed. Hence, he submitted that the value stated in the sale deed is not reflecting the correct value of the property purchased. He further contended that when there are two prices, one as per the sale agreement and the other as per the sale deed are available, the Tribunal could have accepted either of the price by adducing proper reasoning for the same. But strangely in this case accepted a value in between the two prices on the ground that the value has been arrived at by the Inspector of the Department and the same has been accepted by the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t is evident from the records that the assessee has entered into an agreement of sale on 21st Feb., 1983, for the purchase of the land in an extent of 0.75 acres with an incomplete superstructure thereon. The sale consideration was shown as ₹ 2,07,000. It is also stated in the agreement that the assessee had paid a sum of ₹ 45,000 as advance in respect of the sale transaction. The sale deed pursuant to the agreement was registered on 2nd March, 1983, wherein the sale consideration had been shown as ₹ 40,000. In the statement at the time of search, the assessee has explained that the agreement was a bogus one and made up for the purpose of obtaining loan for completing the Cinema Theatre. However, the assessee explained tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of the sale agreement also strengthened the case of the Revenue. If really the sale price is only ₹ 40,000, there is no question of paying over and above the sale consideration as advance. The receipt of ₹ 45,000 has not been denied by the vendor of the assessee and the assessee has also not spoken about the excess payment of advance. In respect of sale of purchase of immovable property, the parties after negotiating the terms of sale transaction arrive at certain terms with regard to the price and the time within which the sale has to be executed and thereupon extract the terms and conditions by means of agreement. The agreement would bind both the parties and in case of breach of terms and conditions, it is always open to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f ₹ 50,000 for the purpose of construction would also militate against the assessee as to the payment of consideration in a sum of ₹ 40,000. Whatever may be the circumstances, in which the vendor was placed, the consideration as to escalation of price during, the relevant period in respect of the landed property and the amount spent thereon by the vendor for putting up construction would also lean in favour of the Revenue to come to the conclusion that the sale consideration shown in the sale deed is not correct and the consideration stated in the agreement is the real amount. The reasoning given by the Tribunal that the department has not brought any evidence to show that the assessee has purchased the property for ₹ 2,07 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion stated in the agreement of sale is inflated one. That was a case, in which the assessee had declared a higher quantity of closing stock to the bank for the purpose of securing a loan than the one accounted in the books of account and returned in the returns filed by the assessee. In the facts and circumstances of that case, the Tribunal came to the conclusion that the closing stock declared in the return filed by the assessee was based on the books of account and having found so, the Tribunal accepted the closing stock declared to the bank for the purpose of obtaining a loan is an inflated one. In that case, there are materials to prove that the assessee had declared to the bank and inflated closing stock for the purpose of getting loan ..... X X X X Extracts X X X X X X X X Extracts X X X X
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