9911796707
TMI Blog2019 (3) TMI 281X X X X Extracts X X X X X X X X Extracts X X X X ..... e rent to assessee were not established." 3. Facts stated in brief shows that assessee is an individual who filed her return of income on 3/8/2011 declaring total income of INR 805980/-. The case of the assessee was selected for scrutiny under CASS. During the year, the assessee has earned income from sale of property, other sources and agricultural income. As per the AIR information, the assessee has deposited cash in a savings bank account and shown sale/purchase of immovable properties, that requires to be verified. Assessee has also shown an agricultural income of INR 2,200,000 as rent received of her agricultural land. On the sale of the property, the learned assessing officer noted that net consideration of two plots of agricultural land sold by the assessee, has not been shown at the circle rate. The learned assessing officer adopted the circle rate holding that these agricultural land are falling into the industrial area and adopting that rate , applied the provisions of section 50C of the act. Therefore for plot number 76 the learned AO adopting the sale consideration of INR 10398843 computed the short-term capital gain of INR 9 740081 against short-term capital loss disc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unt of short-term capital gain on sale of land is deleted by the learned CIT appeal, the fact shows that, The learned AO found that assessee has sold four properties and out of which in two properties, the assessee has shown short-term capital loss. Therefore with respect to these 2 properties in which assessee has shown short-term capital loss the learned AO issued show cause notice on 28/3/2014. The assessee replied it. Based on this the learned assessing officer noted that during the year assessee has sold 2 properties plot area admeasuring 455.50 yd² bearing plot number 76C at Mundka , New Delhi and plot area 442 yd² at village Mundka , New Delhi. The assessee has not taken the sale price of these properties at circle rate. AO also noted that the above plots are in industrial area and are as per master development plan of Delhi/2010 falling into category C. The circle rate of this property is adopted at Rs. 27300 per square meter. Accordingly he invoked the provisions of section 50C and calculated the short-term capital gain in respect of the above properties and made an addition of INR 19303658/-. 6. Assessee approached The Commissioner of Income Tax Appeals - 14, N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the provisions of section 50C of the income tax act provides that net sales consideration if it is less than the fair market value as per the stamp duty then same should be adopted as net sales consideration. b. The assessee has also not claimed before the assessing officer that circle rate is not the fair market value of the property. Therfore only option with the revenue is to adopt the FMV for stamp duty as per registering authorities. c. whether the land is categorized as the industrial land or as agricultural land but the provisions of section 50C applies. She stated that the assessee has never contested before the assessing officer that the agricultural land sold by the assessee is not industrial land and therefore the learned CIT has incorrectly found fault with the assessing officer. d. Even when no sale deed executed is no ground about non applicability of the provisions of section 50C of the act. She referred to the amendment in section 50 C and stated that decision relied by CIT (A) are prior to amendment and does not apply to the AY in this appeal. e. learned assessing officer is not required to bring anything more on record other than the difference between ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ] by the stamp valuation authority under sub-section (1) exceeds the fair market value of the property as on the date of transfer; (b) the value so adopted or assessed 91 [or assessable] by the stamp valuation authority under sub-section (1) has not been disputed in any appeal or revision or no reference has been made before any other authority, court or the High Court, the Assessing Officer may refer the valuation of the capital asset to a Valuation Officer and where any such reference is made, the provisions of sub-sections (2), (3), (4), (5) and (6) of section 16A, clause (i) of sub-section (1) and sub-sections (6) and (7) of section 23A, sub-section (5) of section 24, section 34AA, section 35 and section 37 of the Wealth-tax Act, 1957 (27 of 1957), shall, with necessary modi-fications, apply in relation to such reference as they apply in relation to a reference made by the Assessing Officer under sub-section (1) of section 16A of that Act. 92[Explanation 1].-For the purposes of this section, "Valuation Officer" shall have the same meaning as in clause (r) of section 2 of the Wealth-tax Act, 1957 (27 of 1957). 93 [Explanation 2.-For the purposes of this section, the expr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n and resultant computation of capital gain is required to be made. The learned AO may also enquire the same to the registering authority. Accordingly, ground number 1 of the appeal of the revenue is allowed with above direction. 9. Coming to ground number 2 of treatment of agricultural income shown by the assessee as income from other sources by the learned assessing officer, the fact shows that, On verification of the return of income the learned AO noted that the assessee has declared an amount of INR 2,200,000 as agricultural income being rent received from two different persons . Assessee was asked to justify his claim along with the necessary supporting evidence. The assessee submitted that she owns 46 bigha of agricultural land, which was given to two parties on annual rent of Rs. 10 lakhs and Rs. 12 lakhs aggregating to INR 2,200,000 respectively. The learned assessing officer was also submitted the details of lease money received from the parties as well as the agricultural produce details. The learned assessing officer examined the parties from whom the assessee has received lease rent. Based on the statement the learned assessing officer came to conclusion that such per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eu of that , farmers have paid to the appellant the rent, which has been claimed by the appellant as agricultural income. Further the persons from whom the rent was received have given copies of their AADHAR card and voter ID in order to prove their identity, as they all were not assessable to income tax neither of them filed their income tax returns and nor had their permanent account number. He further held that no adverse evidence has been brought against the claim of the assessee during the course of assessment. Hence, he held that the learned assessing officer is not justified in making addition of INR 2,200,000 to the income of the appellant by treating agricultural income as income from other sources. Accordingly, he deleted the addition. The revenue as per ground number 2 of the appeal challenges this deletion. 11. The learned senior departmental representative vehemently supported the order of the learned assessing officer and stated that both the persons from whom the rent has been received have been examined by Ao, both of them have been found not the persons of adequate means. She further stated that there is a difference between the agricultural produce claimed by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... means. The learned CIT - A has ignored the statement of these two persons recorded by the learned assessing officer. The ld CIT A also did not examine anything but merely believed the claim of the assessee. There is no concrete finding about the difference between the agricultural produce. He also did not examine the facts that how the persons of such a small mean could have given the rent in advance to the assessee. He also did not gave any finidng that the amount of rent paid by the other person is out of borrowings and what could have been the sources of borrowing by that person to pay such a huge rent to the assessee. He merely believed the written submission of the assessee for deleting the addition. Therefore, we do not find that on the facts stated by the learned assessing officer the addition deserves to be deleted. We further fully agree with the argument of the learned senior departmental representative that the learned assessing officer should have made the addition as unexplained credit under section 68 but the learned assessing officer under the mistake has made the addition as income from other sources. We are not concerned with it and now we cannot correct it also. ..... 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