ITA No. 653 of 2009 1
IN THE HIGH COURT OF PUNJAB AND HARYANA AT
CHANDIGARH
ITA No. 653 of 2009
Date of decision: 7.1.2010
The Commissioner of Income Tax, Faridabad
...Appellant
Versus
Chandni Bhuchar
...Respondent
CORAM: HON'BLE MR.JUSTICE M.M.KUMAR
HON'BLE MR.JUSTICE JITENDRA CHAUHAN
Present: Ms. Urvashi Dhugga, Advocate
for the appellant-Revenue.
1. To be referred to the reporters or not?
2. Whether the judgment should be reported in the Digest?
M.M.KUMAR,J.
The instant petition filed by the Revenue under Section 260-A
of the Income-tax Act, 1961 is directed against the order dated 27.2.2009
passed by the Income Tax Appellate Tribunal, Delhi Bench (for brevity `the
Tribunal') in ITA No. 1580/Del/2008 for the assessment year 2004-05 in
respect of assessee-respondent.
There is categorical finding recorded by the Commissioner of
Income Tax (Appeals) [for brevity `CIT(Appeals)] holding that value
adopted or assessed by any authority of the State Government for the
purpose of payment of stamp duty in respect of land or building cannot be
taken as sale consideration received for the purpose of Section 48 of the
Act. As against the purchase price disclosed in the sale deed at Rs.
17,06,700/-, the Assessing Officer has adopted the purchase price of the
property at Rs. 30,32,000/-, which is assessed for the purpose of paying theITA No. 653 of 2009 2
stamp duty. Accordingly, it was held that the assessee must have paid
Rs.13,25,300/- over and above the purchase price disclosed in the sale deed
and the Assessing Officer made addition of this difference as income from
unexplained sources. The CIT (Appeals) deleted this addition by holding
that Section 50-C is a deeming provision for the purpose of bringing to tax
the difference as capital gain. The CIT(Appeals) further held that in the
absence of any legally acceptable evidence, valuation done for the purpose
of Section 50-C would not represent actual consideration passed on to the
seller. He placed reliance on the judgment of Allahabad High Court
rendered in the case of CIT vs. Raj Kumar Bimla Devi and others 279
ITR 360. In that case Allahabad High Court has relied upon the
observations made by Hon'ble Supreme Court in the case of Jawajee
Nagnatham vs. Revenue Divisional Officer (1994) 4 SCC 595 to hold that
the Basic Valuation Register prepared and maintained for the purpose of
collecting stamp could not form the foundation to determine the market
value of the acquired land under Section 23 of the Land Acquisition Act,
1894. The burden of proof is always on the claimant to prove such a fact
and in each case the prevailing market value as on the date of notification
published in the State Gazette under Section 4(1) of the Act has to be
proved. The Tribunal also held that valuation done by any State Agency for
the purpose of stamp duty would not ipso facto substitute the actual sale
consideration as being passed on to the seller by the purchaser in the
absence of any admissible evidence. The Assessing Officer is obliged to
bring on record positive evidence supporting the price assessed by the State
Government for the purpose of stamp duty. The view of the Tribunal is
clear from para 7 of the its order, which reads thus:-ITA No. 653 of 2009 3
“From a plain reading of this provision, it emerges out that the
value adopted or assessed by any authority of a State
Government for the purpose of payment of stamp duty in
respect of land or building or both, shall for the purpose of sec.
48 be deemed to be the full value of the consideration received
or accruing as a result of transfer. It nowhere provides that the
valuation done by the State Government for the purpose of
stamp duty etc. would ipso facto take place the actual
consideration as being passed on to the seller by the purchaser
in the absence of any other evidence. The Assessing Officer is
required to bring positive evidence on record indicating the fact
that assessee has paid anything more than the one disclosed in
the purchase deed. The department has taken an argument in
the grounds of appeal that Assessing Officer should be directed
to make a reference to the Valuation Officer under sec. 142A of
the Act. It also raised a plea that Assessing Officer has
wrongly made a reference of sec. 50-C while making the
addition, in fact, the addition is made under sec. 69-B on
account of unexplained investment in the property. We have
taken cognizance of both these arguments. It is the Assessing
Officer who himself ought to have collected the evidence
indicating the fact that assessee has paid more money than the
one disclosed in the purchase deed. The ITAT while sitting in
the second appeal is not supposed to give directions on the
appeal of revenue that a reference to the Valuation Officer is to
be made in order to substantiate the addition. The steps whichITA No. 653 of 2009 4
Assessing Officer could have taken, if not taken then that
lacuna cannot be filled up at the end of the ITAT. In the
absence of any evidence exhibiting the fact that assessee has
made unexplained investment in the house property, no
addition can be justified. Learned Ist Appellate Authority has
appreciated the facts and circumstances in right perspective.
We do not find any error in the impugned order on this ground.
Thus, the ground of appeal raised by the revenue is rejected.”
Having heard the learned counsel, we are of the considered
view that the view taken by the Tribunal while accepting the order of the
CIT (Appeals) does not suffer from any legal infirmity.
The argument of the learned counsel for the revenue that the
Tribunal should have asked the Assessing Officer to make a reference to the
Valuation Officer under Section 142A of the Act does not require any
detailed consideration because CIT(A) had sent the evidence produced by
the assessee to the Assessing Officer for his comments. He conducted an
inquiry and asked the assessee-respondent to produce original bank
statement. Then he sent a reply to the CIT(A) authenticating the whole
transactions. Thereafter the CIT(A) and the Tribunal have accepted sale
consideration depicted in sale deed as fact. The assessee-respondent has
discharged the burden of proving the sale consideration as projected in the
sale deed. Moreover, the learned counsel for the revenue has not been able
to point out that the view taken by the Allahabad High Court in Raj
Kumar Bimla Devi's case (supra) has been challenged before Hon'ble
Supreme Court and the same has been rejected. The aforesaid view seems
to have acceptance of the appellant. It that be so then the principle ofITA No. 653 of 2009 5
consistency would require that the aforesaid view be followed as the
correct view.
Accordingly, we are of the view that no question of law much
less substantial question of law warranting admission of the appeal would
arise for determination of this Court. Dismissed.
(M.M.KUMAR)
JUDGE
07.01.2010 (JITENDRA CHAUHAN)
mk JUDGE
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