TMI Blog2016 (10) TMI 1259X X X X Extracts X X X X X X X X Extracts X X X X ..... ing made investment should be first proved by the AO, only then the burden shifts on the assessee to prove the source of investment. Such investment outside the books of account must be positively proved by the AO and not only inferred from the attending facts. If such an investment outside the books is not proved, the assessee cannot be called upon to prove the source of such a hypothetical investment. Apart from relying on the DVO s report, the AO has not brought on record any other material to indicate that the assessee did make investment in purchase of plots over and above that declared in the books of account. The legislature is also not oblivious of the practice of understatement of consideration in the transactions of immovabl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .2010 in relation to the assessment year 2006-07. 2. The assessee has filed revised grounds of appeal. 3. The first issue raised in these appeals is against the addition u/s 69 of the Act. Briefly stated, the facts of the case are that the assessee is engaged in the business of purchase of lands/buildings and to develop the same for the purposes of disposing/maintaining. During the year under consideration, the assessee purchased freehold land measuring 17.83 acres for a sum of ₹ 3,31,90,000/-. This land was purchased vide 11 sale deeds which were executed between 29.8.2005 and 28.9.2005. The land is located within the MCD city limits. As the AO was not satisfied with the purchase consideration, he referred the mat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ief allowed by the ld.CIT(A) amounting to ₹ 2,12,52,500/-. 4. We have heard the rival submissions and perused the relevant material on record. It is observed that the only dispute on this issue is about the investment made by the assessee in purchase of 11 plots in the course of its business. Whereas the assessee went by the rates given in sale deeds as a proper measure of investment made, the AO estimated the investment made by the assessee on the basis of the DVO s report, which valuation was partially reduced by the ld. CIT(A). The AO, in making this addition did not reject the books of account maintained by the assessee and straightway went ahead in making the addition on the basis of the DVO s report. The Hon ble Suprem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rst rejecting the books of account, is valid up to the period prior to the insertion of sub-section (2). As the assessment year under consideration is 2006-07, being, a year anterior to the amendment, the same will be governed by the judgment in Sargam Cinema (supra) and not the later amendment nullifying the pro tanto effect of this judgment. 6. Here it is pertinent to note that the Assessing Officer has made the addition u/s 69 of the Act. This section, in turn, provides that : `Where in the financial year immediately preceding the assessment year the assessee has made investments which are not recorded in the books of account, if any, maintained by him for any source of income, and the assessee offers no explanation about the n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for charging to tax the difference between stamp value and the declared consideration in the hands of the buyer, if such difference is more than ₹ 50,000/-. As this is a substantive provision inserted w.e.f. 1.10.2009, the same cannot be applied to the assessment year 2006-07 under consideration. Ex consequenti, the entire addition made by the AO is deleted. The ground taken by the assessee is allowed and that by the Revenue is dismissed. 8. The only other issue which survives in the assessee s appeal is against the confirmation of addition on account of stamp duty and registration charges. Whereas the AO applied 8% rate on the alleged excess investment made by the assessee, the ld. CIT(A) proportionately reduced the same. ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
