TMI Blog2012 (11) TMI 1112X X X X Extracts X X X X X X X X Extracts X X X X ..... misha S. Gupt for the Appellant K.C. Devdas for the Respondent. ORDER Chandra Poojari, Accountant Member - These two appeals by the Department are directed against different orders of the CIT(A) dated 16.4.2010 in respect of co-owners of same property bearing No. 7-2-1813/5/A/1, Sanat Nagar, Hyderabad. The grounds in these appeals are common in nature and hence these are clubbed together, heard together and are being disposed of by this common order, for the sake of convenience. 2. The common grounds are as follows : 1. The CIT(A) erred both in law and facts. 2. The CIT(A) ought to have appreciated the fact that in the registered sale deed the value of the property as per market value was correctly adopted by the Registration authorities. 3. The CIT(A) would have rejected the impugned agreement of sale which was notarised by the assessee but not registered with registration authorities. 4. The CIT(A) would not have allowed the assessee to submit additional evidence which was not filed by the assessee before the Assessing Officer and would have given due cognisance to the remand report submitted by the Addl. CIT, Range-11, Hyderabad. 3. Brief facts of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mp duty was ₹ 4,30,70,000. Stamp duty was paid by the purchaser on the value of ₹ 4,30,70,000. The purchasers did not dispute the stamp duty valuation. The Addl. Commissioner of Income Tax addressed a letter to the Sub-Registrar to confirm the valuation who responded as under: With reference to the subject cited, I am herewith submitting the Basic Market value of the land and built up area of property bearing House No. 7-1-1813/5/1, Sanath Nagar, Hyderabad for the Document No. 3637/2005, dated 25.11.2005 is as follows: Land 4840 Sq. Yds x 8000 = 3,87,20,000 Building 15000 Sq. Yds x 290 = 43,50,000 Total Market value 4,30,70,000 The party has paid the stamp duty of ₹ 9,69,100/- Registration fees to ₹ 2,15,350/- and Transfer duty of ₹ 8,61,400/- total comes to ₹ 20,45,850/-. 6. Based on the above information, the Additional Commissioner of Income Tax issued a Show Cause Notice on 10.12.2008 to adopt the sum of ₹ 4,30,70,000 as the sale considerati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l not be any difference. The value of land comes to ₹ 2,30,40,000 and the building has not value since it is more than BO years old building it has no value. Therefore we have valued the same at higher value than the SRO value. But it is valued by SRO as per the Addl. CIT's letter at ₹ 43,40,000 as on 30.11.2005. (f) This we have not contested since the purchaser is paying the stamp duty and not by me. (g) In the light of the same I submit that it will not be correct to adopt the sale consideration at ₹ 4,30,70,000 invoking provisions of Sec. 50C since it will be contrary to provisions of law. As per the provisions of law, the value should be as at 13.6.2005 when the capital gains accrued and become taxable and not as on 30.11.2005. I, therefore, request the Addl. Commissioner to accept the sale consideration as admitted by me. 8. On the above basis, the Assessing Officer computed the capital gain considering the total consideration at ₹ 4,30,70,000 and each of the assessee's case herein worked out at ₹ 1,80,46,324 and the short term capital gain determined on each case of the assessee are as follows: 40% share of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d (3) of section 50C to object to the value adopted by the stamp valuation authorities, the Assessing Officer was justified in treating the value adopted by registration authorities as the deemed sale consideration received by the assessee as a result of the transfer. For this proposition she relied on the judgement of the Madras High Court in the case of Ambattur Clothing Co. Ltd v. Asstt. CIT [2010] 326 ITR 245. Further she relied on the order of the tribunal Lucknow bench in the case of Jitendra Mohan Saxena v. ITO [2008] 305 ITR AT 62 wherein held that Fair market value of the property arrived at by stamp valuation authorities being higher than the sales consideration transferred by the assessee and fair market value reported by DVO on reference being higher than the one adopted by the stamp valuation authorities, the Assessing Officer was justified in applying provisions of sec 50C and taking the value adopted by the stamp valuation authorities as full value of consideration for computing the capital gain, provisions of sec 50C are mandatory. 12. Further she relied on the order of the tribunal in the case of Asstt. CIT v. Pravin V. Gandhi [2011] 38 (II) ITCL 311 (Mum ' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s is attracted on date of transfer which includes possession under section 2(47)(v) of the Act. The possession of the property was given on 13.06.2005 on which date the SRO's value of land was ₹ 4,800 per Sq. yard and this accords well with the consideration shown in the sale deed. The property transferred consisted of land admeasuring 4840 Sq yards along with structures in the premises bearing Municipal Numbers 7-2-1813/5/A/1, Sanathnagar, Hyderabad. Further during the course of appellate proceedings, the assessee filed a copy of the Registered Rectification Deed of 14.10.2009 wherein under the Clauses in relation to date of handing over possession of property in the Sale Deed executed on 25.11.2005 was rectified which confirms the fact that possession was given on 13.6.2005. The CIT(A) forwarded a copy of the Affidavit of Advocate D. Jitendra Kumar and a copy of the Registered Rectification Deed of 14.10.2009 to the Sale Deed executed on 23.11.2005 to the Addl. Commissioner of Income Tax for his comments and report. The Addl. Commissioner of Income Tax forwarded the Remand Report dated 11.11.2009 confirming the fact as stated in the Assessment Order. 15. The AR submi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the case set up by the assessee is that once there is invoking of provisions of s. 50C and thereafter the provisions of s. 69B have been invoked then the primary evidence for consideration and appreciation coming into play is that of s. 69B wherein the addition is being made by invoking the deeming provision and the onus to prove with regard to the payment over and above the declared amount is on the revenue and there cannot be transaction unilaterally by the assessee himself till a corroborative piece of direct evidence has been brought on record adverse the assessee which in the present case, has been none. When there is no corroborative piece of evidence placed on record by the Revenue to substantiate contention raised emerging from the order under challenge in form of verification from the seller then the assessee cannot put to tax on the lapse of the Department to which extent written pleadings were advanced at the very initial stage during the course of assessment proceedings and which remains and unrebutted fact till date. In such circumstances and facts of the case, the CIT(A) is not justified in confirming the action of the AO and the addition sustained is directed to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as modified at ₹ 8,000 per sq. yd., thereby resulted in enhanced value for the purpose of registration with the SRO. Under the common law, the date of execution of sale deed shall be taken as date of sale of the property. However under the Income Tax act the legislature made a departure from the common law. Under the Income-tax Act, 1961 the provisions of section 2(47)(v) prescribed that any transfer involving allowing of possession of any immovable property has to be taken or retained in part performance of a contract of nature as provided in section 53A of the Transfer of Property Act would also to be considered a transfer under the Income-tax Act. Therefore, we have to see whether the assessee has handed over the physical possession of property on 13.6.2005 when the agreement of sale was executed. The assessee has filed a copy of sale agreement before us. The important clause no. 7 reads as under. 7. That the vacant, physical peaceful possession of the schedule property is hereby delivered by the Intending Seller to the Intending Purchaser on this day and the Intending Purchaser is at liberty to enjoy the same. 17. We have carefully gone through the above clause of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unal directed the Assessing Officer to take the consideration at ₹ 70 lakhs against the estimated value by valuation officer at ₹ 75,76,712 as the value of the property so estimated that a difference of 10 % which is because of the opinion of the individual valuation officer. No one is expected to value the property accurately since some of the items are to be valued on guess work or notionally. Being so the difference of less than 10% is to be ignored. 18. Further it was decided in the following cases that as per section 2(47)(v), when the vendor given the possession of the property to the purchaser, it is to be considered that the transfer is complete on the date of agreement of sale: (a) CIT v. Veepees Enterprises [2010] 325 ITR 414/175 Taxman 11 (Ker.) wherein held that pursuant to the agreement for sale possession itself was given by vendor to purchaser and in the circumstances vendor is not entitled to contend that section 2(47)(v) of the Income-tax Act was not applicable. (b) Chaturbhuj Dwarkadas Kapadia v. CIT [2003] 260 ITR 491/129 Taxman 497 (Bom) wherein held that in case of development agreement, if the contract, read as a whole indicates passin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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