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TMI Blog2021 (7) TMI 765X X X X Extracts X X X X X X X X Extracts X X X X ..... dition U/s 56(2)(vii)(b) of Rs. 1,61,44,679/- ignoring the facts of litigation on the property matter and restriction by the Highway Authority of India on any construction, merely by accepting DLC rate provided the Registrar. 3. The ld. AO made addition U/s 68B of Rs. 46,00,000/- ignoring the fact and by ignoring the well explained sources of investigation made by the assessee. 4. The ld AO made addition U/s 69C Rs. 13,74,865/- ignoring the fact and adopting own assumption." 2. The hearing of the appeal was concluded through video conference in view of the prevailing situation of Covid-19 Pandemic. 3. Brief facts of the case are that the return of income was e-filed on 30/07/2014 declaring total income of Rs. 1,96,320/-. The case of the assessee was selected for scrutiny through CASS. Necessary notices were issued and served upon the assessee. The A.O. held in the assessment order that the assessee received commission income from property dealing amounting to Rs. 2,38,458/- and also received pension of Rs. 38,067/-. Income from bank interest was also declared at Rs. 44,792/-. Returned income of Rs. 1,96,320/- was declared by the assessee. During the course of assessment proce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CIT (Appeals) First, Jaipur, Page 10 [Paper Book Page and four purchase deed pages 44 to 120 respectively]' Detail of Purchased Agricultural lands is as follows: S. No. Date Details of the property purchased Consideration Paid (Rs.) Stamp Duty Value (Rs.) 1 24.05.2013 Land in Khasra number 950/2 & 953, totalling 2 bigha from Sh. Ram Singh S/o Sh. Kanha Ram 11,00,000/- 27,83,000/- 2 10.05.2013 Land in Khasra number 950/2 & 953, totalling 2 bigha from Sh. Nand Singh S/o Sh. Kanha Ram 4,00,000/- 27,83,000/- 3 24.05.2013 Land in Khasra number 950/2 & 953, totalling 2 bigha from Sh. Gopal Singh S/o Sh. Kanha Ram 4,00,000/- 27,83,000/- 4 15.07.2013 Land in Khasra number 6447, 6448, 6467, 6469, 7602, 7603, 7604, totalling 2.4016 hectare from Sh. Banna Rain S/o Sh. Dev Karan Gurjar 45,00,000/- 1,41,95,679/- Total Rs. 64,00,000/- Rs. 2,25,44,679/- (A) Thus it is well established FACT that all four purchases were AGRICULTURAL LANDS exhibiting KHASARA NUMBERS as per land Revenue record and, Detail of Seller Farmers including their Father's name etc. (B) Section 2 (14) of the Act excludes Agricultural Land out of defini ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Restrictions for construction due to Property situated at highway: Location of the property is at Mega Highway Mauzmabad, District, Jaipur. Highway authorities of India has imposed restrictions to make construction on this land. Prohibition of any construction is imposed by the highway authority of India. Copy of Papers exhibiting such restrictions are submitted enclosed here with. Due to these reasons, No DLC rate can be availed and there is considerable difference between the DLC and Purchased value. Therefore, the Addition Rs. 1,61,44,679 /- made by the learned Assessing officer should be deleted having considered the grounds of the Assessee;s Appeal. (pages 139 to 142) 6. On the other hand, the ld. DR has vehemently supported the orders of the revenue authorities and submitted that the ld. CIT(A) has passed a well-reasoned order discussing all the material facts. 7. We have considered the rival contentions and carefully perused the material placed on record. From perusal of the record we noticed that the ld. CIT(A) has dealt with the issue in detail in para 3.1.2 of his order and the same is as under: "3.1.2 Determination: (i) From the facts of the case, it is seen that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) for a consideration which is less than the stamp duty value of the property by an amount exceeding fifty thousand rupees, the stamp duty value of such property as exceeds such consideration. Provided that where the date of agreement fixing the amount of consideration for the transfer of immovable property and the date of registration are not the same, the stamp duty value on the date of the agreement may be taken for the purposes of this sub-clause. Provided further that the said proviso shall apply only in a case where the amount of consideration referred to therein, or a part thereof, has been paid by any mode other than cash on or before the date of the agreement for the transfer of such immovable property" 2.2. It is clear from the above provision that the assessee received an immovable property for a consideration which is less than the stamp duty value of the property by an amount exceeding Rs. 50,000/-, therefore, the difference between stamp duty value and consideration is liable to be taxed as Income from Other Sources. In this case the difference between stamp duty value and consideration is Rs. 1.61,44,679/- which is chargeable to tax as Income from Other Sources. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he provisions of section 56(2)(vii)(b) of the Act. Therefore, the additional ground raised by the appellant that the above provisions do not apply on purchaser of the property is dismissed. (iv) The attention is also invited to the second proviso to section 56(2)(vii)(b) of the Act, which reads as under: "Provided that where the stamp duty value of immovable property as referred to in sub-clause (b) is disputed by the assessee on grounds mentioned in sub-section (2) of section 50C, the Assessing Officer may refer the valuation of such property to a Valuation Officer. and the provisions of section 50C and sub-section (15) of section 155 shall, as far as may be, apply in relation to the stamp duty value of such property for the purpose of sub-clause (b) as they apply for valuation of capital asset under those sections: Thus, the above provisions allow the AO to refer the property to the DVO in case, the value of the property is disputed by the assessee. As the valuation of the property was relevant in deciding the quantum of addition, the AO was asked to refer the above properties for valuation vide this office letter No. 2298 dated 16.11.2017. The AO submitted the report of DV ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsideration. The properties were purchased far below the value determined by the stamp valuation authorities for the purposes of charging stamp duty. The AO invoked the provisions of section 56(2)(vii)(b) of the Act and made the addition being the difference between value shown in the registered document and value determined by stamp valuation authorities. 9. We further observed that during the appellate proceedings, it was submitted by the assessee that the properties were purchased below the fair market value as litigation was pending regarding legal title in Session's Court, Sambhar, Jaipur. It was also mentioned that as the properties were situated at highway, there was restriction regarding construction on the plots. The assessee also raised an additional ground that the provisions for adopting value as per DLC rate is applicable to seller only and not to the purchaser. From perusal of Section 56(2)(vii)(b) of the Act, it reveals that the provision is applicable on purchase of immovable property, if the consideration is less than the stamp duty value of the property by an amount exceeding Rs. 50,000/-. It is also mentioned that in such cases, the difference between stamp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lf of Assessee on 05,06.13. (Page No. 144 to 146) iii. Rs. 10,00,000/- in cash from SB account of Vishnu Joshi on 22.07.13. (Page No. 147) iv. Rs. 5,00,000 in cash from SB account of Vishnu joshi on 16.09.13. (Page No. 147) 5. 10.05.13 24.05.13 & 15.07.13 Registry charges of all above four properties Rs. 13,64,865/- Rs. 13,00,000/- in cash by making withdrawals from partnership firm M/s Shree PVJ Corporation.(Page No 25 & 26) Total Rs. 77,64,865/- (A) For Property as per chart no. 1, 2 and 3; There is no reason not to accept the payments made as per notarized Regd. two Agreement dated 06-04-1995 furnished by the Assessee. Only by saying that agreements were not in the name of Shri Vishnu Kumar Joshi, the plea of Assessee cannot be denied when:- (A) Deal is relevant to all those khasara of land which were under consideration, more over (B) Agreement were executed with BABA R.N. Gor GRAH NIRMAN SAHKAR SAMITI LTD; Jaipur only through Shri Vishnu Kumar Joshi by caste Brahman R/o Jaipur The Chairman as well as Authorized Representative of Samiti. All proceedings were handled by the Assessee and for those same property, should not be denied me ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... regard, the A/R furnished details vide replies dated 22.07.2016 and 16.12.2016, which are placed on record. The A/R also submitted a chart explaining the source of investment made as under- Sl. No Date Details of the property purchased Consideration Paid Source 1. 24.05.13 Land in khasra number 950/2 & 953, totaling 2 bigha from Sh. Ram Singh S/o Sh. Kanha Rain Rs. 11,00,000/- i. Rs. 8,00,000 paid in cash on 06.04.95 ii. Rs. 3,00,000/- paid by cheque from Axix Bank joint account on 3.06.13 2. 10.05.13 Land in khasra number 950/2 & 953, totaling 2 bigha from Sh. Nand Singh S/o Sh. Kanha Ram Rs. 4,00,000/- Rs. 4,00,000/- paid in cash on 06.04.95. 3. 24.05.13 Land in khasra number 950/2 & 953, totaling 2 bigha from Sh. Gopal Singh S/o Sh. Kanha Ram R. 4,00,000/- Rs. 4,00,000/- paid in cash on 06.04.95. 4. 15.07.13 Land in khasra number 6447, 6448, 6449, 467, 6469,7602, 7603, 7604 totaling 2.4016 hectare from Sh. Banna Ram Sh. Dev Karan Gurjar Rs. 45,00,000/- i. Rs. 20,00,000/- paid by cheque by Narsingh construction on behalf of Assessee on 05.06.13. ii. Rs. 9,00,000 paid by cheque by Narsingh Construction on behalf of Assessee on 05,06 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... signed by the assessee Sh. Vishnu Kumar Joshi. Therefore, there is no legal sanctity of these agreements. Moreover, these agreements do not prove in any way that these lands were purchased by assessee on 06.4.95 and cash payments of Rs. 8,00,000/-, Rs. 4,00,000/- and Rs. 4,00,000/- were made by the assessee on 06.04.95 to the seller of the land. Therefore, these agreements are of no help to the assessee. There is no evidence with the assessee that the payments of Rs. 16.00.000/-made for purchases of these lands were not made during the F. Y. 2013-14, when the sale deeds of these properties were executed and registered. Since, the assessee did not explain the source of cash payments totaling to Rs. 16,00,000/- made during the year 2013-14, the same is treated as unexplained investment in the property and is added to the income of the assessee u/s. 69B of the 1.T. Act, 1961 as the assessee could explain source of payment of Rs. 3,00,000/- only out of total payment of Rs. 19.00.000/- made for purchase of these properties. b) Regarding property at S.No. 4, the A/R submitted vide reply dated 23.12.16 as under:- "a cheque was issued of Rs. 45,00,000/- by assessee in consideration o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appellant again reiterated the same argument that in respect of property No. 1, 2 and 3, cash of Rs. 16,00,000/- was paid much before the actual registry of the above properties. It was claimed that Rs. 16,00,000/- was paid on 06.04.1995 to the seller in cash while the registry of the above property was done during FY 2013-14. The AO has examined the above contention of the appellant in detail and no new fact/ evidence has been brought on record. Therefore, no interference is called for in the order of the AO as far as addition to the extent of Rs. 16,00,000/- in respect of first three properties. (iii) As far as property No. 4 is concerned, it was submitted that the cheque issued for Rs. 45,00,000/- was dishonored and later on, cheques were issued from the bank account of M/s Narsingh Construction amounting to Rs. 20,00,000/- on 05.06.2013 and Rs. 9,00,000/- on 10.06.2013. It was also contended before the AO and during appellate proceedings that the above amount was given by the appellant to M/s Narsingh Construction on earlier dates. However, no details regarding earlier payments given to M/s Narsing Construction was provided either during assessment proceeding or appellate pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iven to M/s Narsing Construction was provided either during assessment proceeding or appellate proceedings. The nature and source of earlier payment to M/s Narsingh Constructions remained unexplained. In the assessment order, the AO has specifically pointed out that an agreement was executed between the parties under the name 'agreement for receiving payment in lieu of cheque', which indicates that cash was received by Shri Banna Ram, the seller of the property, when the cheque issued was dishonored. As per this agreement, cash of Rs. 45,00,000/- was paid to the seller by the assessee on 11.12.2013. Thus, there is no doubt that the payment in lieu of dishonored cheque was made in cash by the assessee on 12.11.2013. Hence, the claim of the assessee regarding payment through M/s Narsingh Constructions is not established. As far as remaining cash payment of Rs. 16,00,000/- is concerned, the AO himself granted benefit to the extent of Rs. 15,00,000/- on the basis of withdrawal from bank account. No new facts or circumstances have been brought before us by the ld AR in order to controvert or rebut the factual findings recorded by the ld. CIT(A), therefore, we see no reason to in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that payment of registration charges was made on before the date of registration but the A/R has claimed that payment was made out of Rs. 13,00,000/-received in cash from Shree PVJ Corporation on 06.12.2013. When the assessee made payment of registration charges on 10.05.13, 24.05.13 & 15.07.13 then how the source of same could be out of cash payment received from Shree PVJ Corporation on 06.12.2013. Thus, the claim of assessee is apparently wrong. Therefore, it is clear that the A/R has failed to explain the source of cash payment of Rs. 13,74,865A made for registration charges. Therefore, the same is treated as unexplained expenditure us. 69C of the IT. Act, 1961 and added to the income of the assesse. " (ii) During the appellate proceedings, the appellant admitted that payment of Rs. 13,00,000/- was received in cash from M/s Shree PVJ Corporation only on 06.12.2013 while the registration of property was made in the month of May and July 2013. However, it was submitted that he is man of standing and capable of arranging Rs. 10 to 15 Lac for registration. No evidences were produced. (iii) I have duly considered the submissions of the appellant, assessment order and the materia ..... X X X X Extracts X X X X X X X X Extracts X X X X
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