TMI Blog2014 (11) TMI 130X X X X Extracts X X X X X X X X Extracts X X X X ..... he contents of the letter are independently corroborated - The property mentioned in the sale agreement was ultimately sold to the same vendee as agreed in the month of November 2004 - The amount of advance paid by cheque by Shri M.S. Prasad to the assessee was not in doubt - such document could not have been discarded as no evidentiary value attached to it. The assessee could not rebut the evidence found and the contention of the AO on this issue with any cogent or reasonable evidences - The document of sale agreement found in the residential premises of Shri M.A. Chary is a valid document in view of the contemporaneous evidence to the contents of the agreement - On the day of search Shri M.A. Chary deposed that his father sold plot for ₹ 3.06 crores as per agreement - Statement recorded on the day of search is primary statement and it was given on confronting various documents and material found during search - The deponent would not have ventured to state anything which is not in his knowledge - The subsequent retraction could not be considered as a valid retraction and it is only an afterthought. The property is situated in a posh commercial area of Jubilee Hills, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 377; 10,29,270 and agricultural income of ₹ 84,600. The AR of the assessee appeared in response to the notices issued u/s. 143(2) and 142(1 and furnished information called for. 3. During the course of search at the residential premises of the son of the assessee, Sri M.A. Chary, certain sale documents in the name of the assessee were found and seized and marked as Annexure A/EMD/P01/4. Pages 4 and 5 of this annexure are the sale agreement dt. 25th August, 2004 for sale of plot No. 564-A-22-III in Survey N. 403/1 (old), Survey No. 120 (new) of Shaikpet village, admeasuring 2677 square yards (sqy) by Late Sri M.P. Chary to Sri M.S. Prasad. The total consideration for the sale of this property as mentioned on this agreement is ₹ 3.06 crores and on the other hand, pages 6 to 43 of this annexure, are three Agreements of Sale Cum GPA dated 18th November, 2004 between Sri M.P. Chary and Sri T. Narendra Choudary and Sri M. Srinivas Prasad for the same above mentioned plot of land showing the total consideration as only ₹ 1,47,23,500/-. 4. When the difference of consideration between the Sale Agreement (Rs. 3.06 crores) and the Sale Deed (Rs. 1.47 crores) was put to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er all the transactions till his death and Sri M.A. Chary being his son and legal heir was not aware of the transactions and it was only after discussion with the family members after the search operation that the son of the assessee came to know about the details of the transaction. Information was given by the family members of the assessee that the property under reference was having legal and other problems such as ULC, boundary dispute, HT electric line and occupation by the hut dwellers and also dispute with R B Department. It was submitted that the proposed buyers had agreed for higher price provided the problems are solved by the assessee and as the assessee was not agreeable for the same, the proposed buyers had discounted the property value and after negotiations, the sale consideration was finally fixed at ₹ 147.23 lakhs and the sale deal was executed. 7. The learned AR, therefore, submitted that the sale consideration was only ₹ 147.23 lakhs and the capital gains was accordingly computed and admitted by the assessee. The AR submitted that the assessee wanted to get rid of the property for a discounted price of ₹ 147.23 lakhs instead of ₹ 3.0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... respect of the property in question. The CIT(A) observed that these problems have not cropped up subsequently and the assessee has to take the responsibility of clearing those issues and it has been very clearly and categorically deduced in writing by the assessee to fasten the responsibility of clearing the problems on the vendee and agreed for a consideration of ₹ 3.06 crores. The CIT(A) pointed out that the assessee never attempted to resolve the issues before sale of the property and it is always his intention to get rid of the property along with the problems attached to this property. The CIT(A) held that the AR was not correct to contend that the agreed sale consideration was reduced because of the shifting of the burden of resolving the disputes on the property to buyers and in the instant case, the buyers are very much in the knowledge of problems attached to the property and along with the problems they acquired the property, therefore, the said contention of the AR has no force. The CIT(A) opined that the assessee could not rebut the evidence found and the contention of the AO on this issue with any cogent or reasonable evidences. The CIT(A) held that the document ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r confusion and without knowing the facts regarding the sale transaction he had stated in the sworn statement that the sale consideration is at ₹ 306 lakhs as appearing in the agreement. The son and legal heir of the assessee was not aware of the transaction of sale and he was not a party to it and his late father Sri M.P. Chary was only looking after the transaction till his death and only after discussion with the family members consequent to the search operation, the son and legal heir of the assessee came to know that the sale consideration of the plot was only ₹ 147.23 lakhs. Because of lack of knowledge of the facts of the transaction, the assessee's son did not raise any objection during the course of statement recorded on 29.9.2008. 10. It was submitted by the learned counsel for the assessee that since there were problems connected with the plot of land such as obtaining ULC, etc., the plot had to be sold only for ₹ 147.23 lakhs and not at ₹ 306 lakhs as found in the draft agreement. The learned counsel for the assessee relied on the additional evidence being the copy of return of income of the vendee wherein no addition has been made in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble Supreme Court. If so read, it is quite evident that the orders passed on an incorrect assumption of facts or incorrect application of law or without applying the principles of natural justice or without application of mind will satisfy the requirement of the order being erroneous and prejudicial to the interest of the revenue. If the order sought to be revised under Section 263 suffers from any of the aforesaid vices, it cannot be said that the Assessing Officer has adopted , in such an order, a course permissible in law or taken a view where two or more views are possible. 13. The assessee's counsel also relied on the decision in the case reported 219 ITR 235 (Kerala). He also pointed out that the Explanation to section 132 is not applicable in the present case. The learned counsel for the assessee submitted that ground No. 3 has been raised as a legal ground wherein it has been argued that the value u/s. 50C can be enhanced at most to the guideline value and the AO had no power to enhance the value to a figure more than the guideline value. 14. The DR submitted that it is not in dispute about the location of the property situated in posh commercial area of Jubil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... operly about the need, for registering the same property in three different agreements. Land admeasuring 1,071 square yards was sold for a consideration of ₹ 58,90,500, land admeasuring 765 sq. yards was sold for ₹ 42,07,500 and land admeasuring 841 sq. yards was sold for ₹ 46,25,500 thereby totalling to ₹ 1,47,23,500/- was disclosed in the books as against agreed consideration of ₹ 3.06 crores as per sale agreement found in the premises of Shri M.A. Chary. 16. We are in agreement with the order of the CIT(A) and the reasons given by the CIT(A) for dismissing the assessee's appeal are very well reasoned and clinching. We confirm the order of the CIT(A) and extract the relevant portion which has persuaded us to confirm the order of the CIT(A). The relevant portion is as follows: The said document found in the possession of Shri M.A. Chary at the time of search cannot be ignored as a dumb document due to the fact that the contents of the letter are independently corroborated. The property mentioned in the sale agreement was ultimately sold to the same vendee as agreed in the month of November 2004. The amount of advance paid by cheque by Shri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... invited to this decision of Mumbai ITAT reported in 83 ITD 102. Similarly, the Hon ble Gauhati High Court had an occasion to examine a case where a retraction was made after gap of 3 months and held that such retraction is not allowable as reported in 263 ITR 168 in the case of Green View Restaurant vs. ACIT. 17. Further, we note that the property is situated in a posh commercial area of Jubilee Hills, Hyderabad and because of its prime location it will definitely fetch higher value than that was disclosed by the assessee. We are also aware that the buyer of the property will be having the registered document and hence the unsigned agreement being in the possession of the seller viz., the assessee would not amount to dumb document . In the instant case, the circumstantial evidence cannot be brushed aside particularly when going through the process of the agreement, we find that all the clauses in the agreement have been followed. We also note that the property was registered by way of three different agreements of which the agreement dated 18.11.2004 mentioned consideration of sale consideration of ₹ 42,07,500 without bringing out the schedule of payment whereas in the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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