TMI Blog2023 (4) TMI 470X X X X Extracts X X X X X X X X Extracts X X X X ..... re, the provisions of Section 43CA of the Act by no means could have been invoked in its case. Also, as the A.O had failed to point out a single instance wherein the sale consideration received on the sale of the properties/units by the assessee was lower than the value adopted or assessed or assessable by any authority of the state government for the purpose of payment of stamp duty in respect of transfer of the same, therefore, there was no justification for him to have triggered the provisions of Section 43CA of the Act. Alternatively, we are also in agreement with the CIT(Appeals) that even otherwise, now when the valuation towards actual sale consideration and the value adopted for stamp duty in the present case varies between 5% to 7%, i.e., within the tolerance limit of upto 10%, therefore, pursuant to the amendment made available on the statute vide Finance Act, 2019 that is applicable w.e.f. A.Y.2014- 15, no adverse inferences could have been drawn u/s.43CA - We, thus, in terms of our aforesaid observations finding no infirmity in the view taken by the CIT(Appeals) uphold his order. Decided against revenue. - ITA No. 92/RPR/2021 - - - Dated:- 10-4-2023 - Shri Ravish ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Authority. Considering the aforesaid facts, the A.O was of the view that as the assessee had carried out the sales exactly at the same value as was adopted by the Stamp Valuation Authority for the purpose of payment of stamp duty, therefore, offering of discounts by him, i.e., incurring of stamp duty and registration fees would bring the sale consideration below the value determined by the Stamp Valuation authority and would trigger the provisions of Section 43CA of the Act. Accordingly, the A.O on the basis of his aforesaid deliberations, made an addition of Rs.2,24,25,380/- towards sale consideration of the property sold by the assessee as a trader by invoking the provisions of Section 43CA of the Act. 4. Aggrieved the assessee carried the matter in appeal before the CIT(Appeals). The CIT(Appeals) after making necessary verifications observed that the assessee appellant had incurred stamp duty charges, which fact was not only discernible from the e-stamps purchased but was also found mentioned in the registered sale deeds. Referring to the triggering of the provisions of Section 43CA of the Act by the A.O, the CIT(Appeals) was of the view that as the assessee had sold all the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... duly verified by him and found to be correct. Apart from that, the Ld. AR in the course of the hearing of the appeal had taken us through the complete details of stamp duty and registration expenses aggregating to an amount of Rs.2,24,25,380/- that were incurred by the assessee in the course of its business, Page 13 to 25 of APB. In sum and substance, it is a matter of an admitted fact that the stamp duty and registration expenses on the sale of properties were borne by the assessee company. As observed by us herein above, the CIT(Appeals) not finding favour with the disallowance of the assessee s claim for deduction of the aforementioned amount of stamp duty and registration fees had vacated the same by observing as under: 4.1.1 I have considered the facts of the case, plea raised by the appellant and findings of the AO. As a matter of fact the appellant is involved in real estate business and develops piece of land into various sizes of plots and sales the developed plots to customers. The appellant also done construction activities on plots by entering into construction agreement with plot owners. The appellant before me as well as before AO has taken a plea that in order t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ofits and gains from transfer of such asset, be deemed to be the full value of the consideration. (2) The provisions of sub-section (2) and sub-section (3) of section 50C shall, so far as may be, apply in relation to determination of the value adopted or assessed or assessable under sub-section (1). (3) Where the date of agreement fixing the value of consideration for transfer of the asset and the date of registration of such transfer of asset are not the same, the value referred to in sub-section (1) may be taken as the value assessable by any authority of a State Government for the purpose of payment of stamp duty in respect of such transfer on the date of the agreement. (4) The provisions of sub-section (3) shall apply only in a case where the amount of consideration or a part thereof has been received by way of an account payee cheque or an account payee bank draft or by use of electronic clearing system through a bank account 5[or through such other electronic mode as may be prescribed] on or before the date of agreement for transfer of the asset. Clearly, the provisions of section 43CA of the Act are applicable in the case where the consideration received or accru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng addition by invoking provisions u/s.43CA of the Act. Therefore, addition made by the A.O amounting to Rs.2,24,25,380/- is deleted. Therefore, appeal on this ground is allowed. 8. We have given a thoughtful consideration and are persuaded to subscribe to the view taken by the CIT(Appeals) that the claim for deduction of the stamp duty and registration charges by the assessee company were duly allowable as a deduction in its hand. In our considered view, the aforesaid expenses incurred by the assessee company being in the nature of an expenditure that was incurred wholly and exclusively for the purpose of its business would clearly fall within the realm of Section 37 of the Act. Also, we concur with the view taken by the CIT(Appeals) that the claim of the aforesaid amount as an expenditure by the assessee company which in turn was guided by its business prudence could not have been stretched for concluding that the same would scale down the sale consideration below the value determined by the Stamp Valuation Authority and thus, would be in contravention of the provisions of Section 43CA of the Act. We, say so, for the reason that as observed by the CIT(Appeals), and, rightly s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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