TMI Blog2021 (4) TMI 435X X X X Extracts X X X X X X X X Extracts X X X X ..... nking channel as provided under 2nd proviso to section 50C of the Act which has been discussed above. This fact has not been challenged by the authorities below. Thus it can be inferred that the value of the property as determined by the assessee with the buyer of the property for transferring the property at the time of agreement shall be taken as the full value of consideration for the purpose of computing the capital gain under the provisions of section 48. Whether the amendment brought in the proviso to section 50C of the Act as applicable with effect from 1 April 2017 can be applied for the year under consideration i.e. assessment year 2012-13 ? - As decided in DHARAMSHIBHAI SONANI VERSUS ASSTT. COMMISSIONER OF INCOME TAX, CIRCLE 9, SURAT [ 2016 (9) TMI 1259 - ITAT AHMEDABAD] such amendment being clarificatory in nature is applicable retrospectively - We also note that the fact that the assessee has transferred the property in the financial year 2010-11 was very much appearing in the sale deed - Thus there remains no ambiguity that there was no violation of the provisions of section 50C of the Act for adopting the sale consideration for the transfer of the property by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Pr. CIT has erred in law and on facts in assuming jurisdiction in passing the order u/s 263, more so when the assessment order passed under section 143(3) r.w.s. 147 dated 29.10.2015 is neither erroneous nor prejudicial to the interest of Revenue. 3. That having regard to the facts and circumstances of the case, Pr. CIT has erred in setting aside the assessment order passed under section 143(3) of the Act by the Assessing Officer on the ground that the enquiries and verification which should have been made has not been conducted in terms of Explanation -2 to Sec. 263 and that the assessment order doesn't become erroneous. 4. That Pr. CIT has erred on fact and in law in not appreciating that the reply in specific reference to the claim of consideration value of the capital asset at ₹ 32,00,0007- was in accordance with the Circle Rate (Stamp Duty value) prevailing on the date of Agreement for Sale and that part consideration was received by Account Payee Cheques much prior to effecting the sale/ conveyance on 21.04.2011, was inquired during the assessment proceeding and that such explanation has been considered to be in accordance with law and that the same was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that sale consideration was shown at ₹ 32 lakh whereas stamp value of the land on the date of transfer i.e. 21-04-2011 was at ₹ 77,96,000/- only. Thus the AO erred in not making addition of difference in the value of the property viz a viz stamp value as provided under section 50C of Act which is causing prejudice to the interest of revenue. Accordingly the PCIT issued notice under section 263 of the Act. 4.2 The assessee in response to the notice submitted that he has transferred residential property vide sale deed dated 21-04-2011 for ₹ 32 lakh. But the consideration was decided 3 month before the execution of sale deed which is evident from para 3 page 3 of the sale deed. Accordingly the assessee contended that as per amended proviso to section 50C of the Act, the stamp value for the purpose of capital gain should be taken from the date of agreement to sale. Thus in his case, the stamp value should be the sale consideration as applicable in the month of Jan 2011. The assessee further filed certificate of stamp value issued by Deputy Collector showing value at ₹ 6800 per square meter. Thus the assessee claimed that the value of the property in question ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... manner as detailed below: Date of receipt of amount and cheque number Amount in Rs. 22-01-2011 1,00,001 25-01-2011 4,00,000 14-03-2011 4,50,000 15-03-2011 4,50,000 17-03-2011 4,50,000 17-03-2011 4,50,000 28-03-2011 4,50,000 28-03-2011 32,00,001 9.1 Accordingly, the assessee contended before the AO that the sale price of ₹ 32 lakh should be taken as sale consideration for working out the capital gain in pursuance to the provisions of section 50C of the Act as the Jantari value of land was of ₹ 28,65,520/- only in the month of January 2011. The contention of the assessee was duly accepted by the AO in the assessment framed under section 143(3) r.w.s. 147 of the Act vide order dated 29-10-2015. 9.2 However, the learned PCIT was of the view that the value of the proper ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... operty and seller has received the consideration from the buyer wholly or partly through banking channel on or before the time of agreement of transfer. 9.5 There is no ambiguity to the fact that the assessee being a seller has received the consideration from the buyer in the financial year 2010-11 as discussed above and that too through banking channel as provided under 2nd proviso to section 50C of the Act which has been discussed above. This fact has not been challenged by the authorities below. Thus it can be inferred that the value of the property as determined by the assessee with the buyer of the property for transferring the property at the time of agreement shall be taken as the full value of consideration for the purpose of computing the capital gain under the provisions of section 48 of the Act. 9.6 A question arises whether the amendment brought in the proviso to section 50C of the Act as applicable with effect from 1 April 2017 can be applied for the year under consideration i.e. assessment year 2012-13. In this regard we find that this ITAT in the case of Dharamshibhai Sonani vs. ACIT in ITA No 1237/Ahd/2013 reported in 75 taxmann.com 141 has held that such amen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of the provisions of section 50C of the Act for adopting the sale consideration for the transfer of the property by the assessee. 9.9 Moving further, we also find that the reopening in the case on hand was made on the assessee for the reason that the assessee has not adopted the sale consideration as provided under section 50C of the Act. In other words, the assessee should have taken the value determined for the purpose of the stamp duty as the sale consideration for working out the capital gain under the provisions of section 48 of the Act. The reasons recorded for reopening the assessment under section 147 of the Act are extracted below: As per the AIR information, the assessee has sold immovable property for ₹ 32,00,001/- on 21st April 2021. Jantri value of the said property as per the stamp duty paid by the assessee is ₹ 77.96 lacs. The capital gain offered by the assessee in the return of income for A.Y. 2012-13 is therefore, much less than what he should have actually been offered as per the provision of the section 50C of the Act. Therefore I have reason to believe that the income chargeable to tax has escaped assessment within the meaning of section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... draw support and guidance from the order of Mumbai Tribunal in the case of Anil L Taodarwal, Mumbai vs Pr Cit 19, in ITA No.3498/Mum/2017 vide order dated 02-01-2018, wherein it was held as under: We are not oblivious of the fact that the legislature, vide the Finance Act, 2015, by making available Explanation 2 to Sec. 263 on the statute w.e.f 01.06.2015, had therein provided certain circumstances, under which the order passed by the A.O, if, it is in the opinion of the Principal Commissioner or Commissioner so, shall be deemed to be erroneous in so far as it is prejudicial to the interest of the revenue. However, exercise of such deemed powers conferred on the revisional authority as per Explanation 2 have to construed by strictly confining and subject to satisfaction of the conditions contemplated therein. We are of the considered view that to the extent making of inquiries and verification which in the opinion of the CIT the A.O should have made, as contemplated in Clause (a) of Explanation 2, though gives an edge to the opinion of the CIT as regards the inquiries and verifications which the A.O should have made, but then, such inquiries and verifications are not only requ ..... X X X X Extracts X X X X X X X X Extracts X X X X
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