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2019 (11) TMI 754 - AT - Income TaxAddition emanating from the provisions of Sec.50C - difference in agreed sale consideration reflected by the assessee and stamp duty valuation - HELD THAT:- It is undisputed fact the sole project being carried out by the assessee was substantially completed which is evidenced by the inspection carried out by the department at the project site. In fact, the assessee has not even contested the same before us. There would be no quarrel on the point that the income from the project was rightly brought to tax by AO during the year under consideration and no interference, in this regard, would be required from our side. So far as the difference in agreed sale consideration reflected by the assessee and stamp duty valuation is concerned, we find that nothing has been brought on record by Ld. AO that the assessee was in receipt of higher sale consideration than reflected by the assessee in its books of accounts. Clearly, the provisions of Section 43CA as well as Sec 50C were not applicable to the year under consideration. However, the perusal of quantum assessment order would establish that either of these sections have not been invoked by Ld. AO. Onus was on assessee to establish that the agreement value received by the assessee as sale consideration was the fair market value of the inventory being sold by the assessee. The assessee remained unsuccessful in demonstrating the same. In fact, the assessee did not offer any income / loss from the project only on the pretext that certain issues were pending with relevant authorities. The obligation to offer the income from the project would not be dependent on the settlement of the litigation and the same could not be allowed to be postponed till indefinite period of time. The revenue could not be deprived-off its legitimate dues particularly when the project was substantially sold-off and the occupation was already granted as way back as FY 2006-07 & 2007-08. Therefore, the conduct of the assessee do not inspire us to confirm the stand of Ld. first appellate authority, in this regard. In our opinion, the assessee was duty bound to furnish proper explanation regarding sale of inventories at less than stamp duty valuation. Quantum of expenditure is concerned, since the correct income of the project was to be ascertained, the assessee would be entitled for actual expenditure incurred on the project and estimated expenditure which were likely to be incurred provided the expenditure had crystallized during the year and there was reasonable certainty of outflow of the same. Nothing concrete, in this regard, emanates from the quantum assessment order as well as appellate order. Restore the matter back to the file of Ld. AO to ascertain the correct income of the assessee earned from the said project and reframe the assessment after affording reasonable opportunity of being heard to the assessee. The assessee is directed to substantiate his claim, in this regard, including explanation for sale of flat at less than stamp duty valuation.
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