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2019 (5) TMI 1834 - AT - Income TaxAddition adopting value of property at circle rates, by applying the provisions of section 56(2)(vii)(b)(ii) - assessee had purchased a property for the consideration of ₹ 10,00,000/- as against the value of ₹ 35,65, 000/- determined for stamps duty purpose as per sale deed dated 31.07.2013 - HELD THAT:- Neither, the AO nor the ld. CIT(A) has made any efforts to crystalize the actual value of investment by the assessee in the purchase of the property by way of bringing material documentary evidence on record to establish the unexplained investment in the property by the assessee. Merely, rejection of the reply of assessee without giving valid reasons can not justify the action of the subordinate authorities. In the case of “Sunil Kumar Agarwal [2014 (6) TMI 13 - CALCUTTA HIGH COURT] has clearly held that the AO, discharging quasi-judicial function, has the bounden duty to act fairly and to follow the course provided by law, which in that case, was the reference to the valuation officer. In the present case, in view of the assessee’s specific dispute and claim before the AO that stamp valuation of the property sold was not its “fair market value”, it was the bounden duty of the AO to have made reference to the Valuation Officer which, for the reasons not borne on records, was not made. AO not only passed a cryptic order without disputing any of the grounds of dispute raised by the assessee but also failed to follow the procedure prescribed in law i.e. making of a reference to the DVO as mandated by section 50C (2) of the Act. Therefore, the addition made by the AO cannot be approved. In the present case, it is noted that neither the Assessing Officer nor the Ld. CIT(A) appreciated the contentions raised by the assessee while adopting the the stamp duty value as fair market value of the property purchased nor referred the matter to the DVO as was required U/s 50C(2) of the Act. The AO has also not found or alleged with any corroborative material evidence that the assessee has paid any excess amount over the sale consideration mentioned in the sale deed. Considering the factual Matrix and binding legal decisions, the findings of ld. the CIT(A) in confirming the addition made by the AO can not be approved. In our considered onion, the department cannot be allowed a second inning, by sending the matter back to AO, enabling it to fill the lacunae and shortcomings and putting the assessee virtually to face a re-trial for no fault of him and to again prove before the AO that the sale consideration was the “fair market value” of the property purchased by him. This would amount to giving a lease of life to an order which on the basis of facts on records is unsustainable in law. - Decided in favour of assessee.
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