TMI Blog2023 (7) TMI 602X X X X Extracts X X X X X X X X Extracts X X X X ..... n of the property by issuing the show- cause notice. After considering the detailed reply filed by the assessee and the revised Long Term Capital Loss by the assessee the Ld. PCIT has fairly dropped the revision proceedings on the application of Section 50C in the computation of capital gain. Regarding the second limb of the notice namely non- application of cost inflation indexed by the assessee. PCIT has clearly brought out from the registered Sale Deed dated 25.06.2016 that a sum was paid by the assessee as early as 18.03.2010 by various cheques numbers drawn of Bank of Baroda all dated 18.03.2010 and is adjusted against the sale consideration. However, remaining balance amount was paid by two cheques drawn on HDFC Bank dated 22.07.2016 to the assessee. It is further seen from the Registered Sale Deed that the above amount was given at the time of Banakhat. However, the assessee claims the same sum as loan transaction which is an independent transaction between the same parties is not proved by the assessee with proper documentation and evidences. In the absence of the same, we do not find any merits in the arguments of the assessee. As further seen from the Revision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thereby, the cost of Non-Agricultural land works out to Rs. 5,43,32,653/-. As per the provisions of Section 50C of the Act the value of the said land should have been considered for Rs. 5,43,32,653/-. Further verification of the sale deed dated 25.07.2016 that the assessee has taken an advance of Rs. 3,51,30,000/- as early as 18.03.2009 i.e. just one day before purchase of this piece of land namely 19.09.2009 from the very same parties, that is whatever purchase value paid by the assessee was received back in the same F.Y. 2009-10, hence the question of indexation while working out the capital gain does not arise. Thus, the Assessing Officer while passing assessment order failed to make necessary enquiries and verification with regard to the two issues which is erroneous in so far as is prejudicial to the interest of Revenue, which is required to be revised under Section 263 of the Act. Hence, a show-cause notice dated 10.06.2021 was issued to the assessee calling for his reply. The assessee was also requested as to why the Long Term Capital Gain (in short LTCG ) should not be taken as Rs. 97,98,327/- without affording Cost Inflation Index as worked as under: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ous observation. The Assessing Officer having examined the issue of applicability of the provision of Section 48 of the Act and accepted assessee s claim during the original assessment proceedings, the same cannot be an erroneous order passed by the Assessing Officer which is also prejudicial to the interest of Revenue. Therefore, this issue is also liable to be dropped for initiation of 263 proceedings. 6. The Ld. PCIT after considering the objection filed by the assessee and held as follows: 13. The contentions of the assessee have duly been considered. However, on perusal of Sale Deed vide Regn. No. 10813/2016, it is noticed that there is mention of advance taken by the assessee of Rs. 3,51,30,000/- on 18.03.2009 which means that whatever purchase value paid was received back in the same financial year i.e. F.Y. 2009-10. Thus, it is noticed that the assessee had not paid any amount against purchase of the impugned sold property as by executing the said purchase deed, the assessee along with other co-owner had received amount of loan back and therefore, the indexation for the cost of acquisition is not allowable. By taking this view, the capital gain is worked out as un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 66/243 ITR 89 (SC) where the Hon ble Apex Court has held that both the twin conditions namely order is erroneous and prejudicial to the interest of Revenue, should be satisfied to the exercise powers under the provisions of Section 263 of the Act and an incorrect assumption of fact or an incorrect application of law by the Assessing Officer will satisfy the requirement of order being erroneous. Thus, the Ld. PCIT held that the Assessing Officer failed to bring the correct income to tax as discussed above and invoking the powers vested under him under Section 263 of the Act is partly set-aside the assessment order passed under Section 143(3) of the Act and directed the Assessing Officer to pass a fresh assessment order after making enquiries and verification thereof and pass fresh assessment order by offering proper opportunity to the assessee. 8. Aggrieved against the Revision order, the assessee is in appeal before us raising the following grounds of appeal: 1. Ld. PCIT-3 has erred in law as well as on fact in assuming jurisdiction u/s 263 of the IT Act. 2. Ld. PCIT-3 has erred in law as well as on fact in holding that assessment order passed u/s 143(3) of the IT Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mal by Sale Deed dated 25.06.2016 for a consideration of Rs. 3,57,36,000/-. As per the registered Sale Deed a sum of Rs. 3,51,30,000/- amount which was paid by various cheques numbers drawn by Bank of Baroda all dated 18.03.2010 is adjusted against the present sale consideration and the remaining balance amount of Rs. 5,99,940/- was paid by two cheques drawn on HDFC Bank both are dated 22.07.2016 and also made TDS of Rs. 6,06,600/-. Thus, the Ld. D.R. submitted the assessee has received Rs. 3,51,30,000/- as early as 18.03.2010 and the remaining 5,99,940/- in the year 2016. Thus, the assessee has received the sale consideration as early as 2009, therefore, the question of indexation for cost of acquisition cannot be provided to the assessee. This issue was not considered by the Assessing Officer while passing the assessment order, though copy of the Sale Deed was produced by the assessee, which is clearly reflecting in the registered Sale Deed the details of transaction. Thus, the Assessing Officer order is erroneous and prejudicial to the interest of Revenue, therefore, initiation of the revision proceedings only to this issue is made within the provision of law under Section 263 o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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