Income Tax Appellate Tribunal - Ahmedabad
Kanchanben B,Moradia, Surat vs Department Of Income Tax on 10 August, 2009
IN THE INCOME TAX APPELLATE TRIBUNAL
AHMEDABAD BENCH "A"
(BEFORE SHRI T K SHARMA AND N S SAINI)
ITA No.3048/Ahd/2009
(Assessment Year: 2006-07)
The Assistant Commissioner V/s Smt. Kanchanben B Moradia,
of Income-tax, Circle-3, 13, Upvan Row House, Near
Surat Sahaj, Super Store, Adajan,
Surat
(Appellant) (Respondent)
Appellant by :- Shri Govind Singhal, Senior DR
Respondent by:- Written Submission
O R D E R
Per N S Saini (Accountant Member): This appeal has been filed by the Revenue against the order of the CIT(A) dated 10-08-2009 for Assessment Year 2006-07. The only ground raised by the Revenue reads as under:-
"On the facts and circumstances of the case and in law, the ld. CIT(A) has erred in deleting the addition made on account of unexplained investment u/s 69B of the Act of Rs.8,99,200/-."
2 The brief facts of the case are that the assessee filed return of income declaring total income of Rs.6,08,538/-. During the course of assessment proceedings, the Learned Assessing Officer noticed that the assessee had purchased a plot for stated consideration of Rs.3,86,000/. On further enquiry, the Learned Assessing Officer noticed that the assessee had paid additional Stamp Duty of Rs.75,457/- on the jantri based value of property determined at Rs.12,85,200/-. On comparing the jantri based value with the disclosed consideration, the Learned Assessing Officer asked the assessee to explain why the differential amount of Rs.8,99,200/- should not be treated as unexplained investment and added to her total income u/s 69-B of the Act. The 2 assessee filed her detailed reply and submitted that cost of purchase of property has been duly reflected in the purchase deed and no consideration over and above the disclosed consideration has been paid. The proposed addition is, therefore, without any basis. The assessee also relied upon the decision of Hon'ble Jurisdictional ITAT in the case of Bharatkumar N Patel vs. ACIT, Circle-3, Surat, ITA No.1749/Ahd/2008 dated 29-02-2008 wherein the Tribunal deleted the addition made u/s 69B on account of unexplained investment in residential house property. The assessee also relied upon various decisions to support her case. However, the Learned Assessing Officer did not agree with the submissions of the assessee and added the differential amount to her total income.
3 On appeal, the learned Commissioner of Income-tax (Appeals) dealt with the issue in detail and following the decision of the Jurisdictional ITAT in the case of Bharatkumar N Patel vs. ACIT, Circle-3, Surat, ITA No.1749/Ahd/2008 dated 29-02-2008 directed the AO to delete the addition of Rs.8,99,200/- by observing as under:
"6 Being aggrieved by the order of the assessing officer, AR represented the case with written submissions. The appellant argued that section 50-C is very specific and inserted specifically to tax the capital gain from transfer of immovable property and it cannot be applied to the buyer of the property. According to the AR, the deeming provision of section 50-C is very specific and limited. The applicability of the provision of this section cannot be extended in a manner that is not permitted under the section. The AR further argued that the subject appeal is squarely covered by the decision of Hon'ble Ahmedabad Bench of ITAT in the case of Bharatkumar N Patel vs. ACIT, Circle-3, Surat wherein the Hon'ble Tribunal on similar facts of the case has deleted very same addition u/s 69-B made by the very same assessing officer. It was contended that judicial discipline mandated the assessing officer to follow the decision of jurisdictional ITAT. The AR placed reliance on several judicial decisions against the addition made under section 69-B of the Act, namely:
a) ITO vs. Satyanarayan Agrawal (2007) 112 TTJ (Jd) 717
b) Smt. Bhanu R Shah & Anr. Vs. DCIT (2004) 3 SOT 792 (Bang) 2 3
c) ACIT vs. Swami Complex (P) Ltd. (2007) 111 TTJ (Jp) 531
d) CIT vs. Star Builders (2007) 294 ITR 338 (Guj)
e) Jagmohan Singh Arora & Ors. Vs. DCIT (2006) 10 TTJ (Mumbai) 6
f) Anand Prakash Soni vs. DCIT (2006) 101 TTJ (Jd) 97/ 7 I have considered the views of the assessing officer, submissions of the appellant and judicial decisions referred to by the appellant. I find that the action of the assessing officer is not sustainable. The Hon'ble ITAT in the case of Bharatkumar N Patel vs. ACIT, Circle-3, Surat has deleted the addition on account of unexplained investment in property made by the very same assessing officer, ACIT, Cir.3, Surat for the assessment year 2005-06 and has held as under:
"10 After careful consideration of the rival submissions, facts and circumstances of the case, provisions of law as well as decision(s) of Hon'ble Supreme Court and various Benches relied upon by the parties, we are of the opinion that the CIT(A) was not justified in confirming the addition by drawing the analogical provisions of section 50-C of the Act. The C IT(A) confirmed the addition by observing that if this proposition is to be accepted, then the deeming provisions of section 50-C of the Act will become inoperable. He, further held that section 50-C of the Act is applicable to the seller and provides that the valuation made by the Stamp Valuation Authorit y is to be deemed as the consideration received by the seller. Having said so, the CIT(A) further held that "The converse will also have to be accepted as true, i.e. the valuation of stamp valuation authorit y will have to be deemed as the consideration paid by the purchaser of the propert y as well.
10.1 We are unable to agree with the aforesaid analogy drawn by the CIT(A) because had the legislature intended so, it could have easily specified such a proposition in the provision itself.
10.2 In view of the settled proposition of law that the appellate authorit y has no right either to add or to delete an y word from the provisions of law unless and until the same are found to be having some ambiguit y, we are unable to sustain the stand of the CIT(A), there being no ambiguit y in the section 50-C of the Act, we are of the opinion that these provisions are not applicable to the purchaser. "3 4
8 The decision of the Hon'ble ITAT is very clear on the subject issue under appeal. The decision of the jurisdictional ITAT is binding on the tax authorities working in the same jurisdiction. Judicial discipline and propriety mandates strict adherence of the order of jurisdictional court or Tribunal. The assessing Officer has erred in not following the order of the jurisdictional ITAT which was brought to his notice at the time of assessment proceedings and referred to in Para 4.1 of the assessment order.
9 It is also pertinent to mention that the assessing officer has not carried out any independent investigation to show that the assessee has made any investment in the property other than the disclosed consideration which is either not recorded in her books or explanation offered by her in respect of such investment is not found to be satisfactory. In view of the above and respectfully following the decision of the Hon'ble ITAT Ahmedabad Bench, I direct the assessing officer to delete the addition of Rs.8,99,200/- made u/s 69- B of the Act."
4 The Learned Departmental Representative supported the order of the Learned Assessing Officer.
5 The Learned Authorised Representative of the Assessee has filed a written submission, wherein, it has been stated that the issue under consideration is covered in favour of the assessee by the decision of this Tribunal in the case of Bharatkumar N. Patel v. ACIT, Cir.3, Surat ITA No.1749/Ahd/2008 dated 29-8-2008 in the Assessment Year 1995-1996 following which the Learned Commissioner of Income Tax(Appeals) has deleted the addition made by the Learned Assessing Officer. Therefore, the order of the Learned Commissioner of Income Tax(Appeals) should be confirmed.
6 We have heard the Learned Departmental Representative and considered the written submissions of Learned Authorised Representative of the Assessee and perused the orders of the lower authorities and the materials available on record. We find that in the instant case addition of Rs.8,99,200/- under section 69B of the Act was made by the Learned Assessing Officer mainly on the basis of difference between the consideration shown in the sale deed and Jantri based value of the property. We find that no material was brought on 4 5 record by the Revenue to show that the assessee has in fact made payment of any amount exceeding the amount disclosed by him in his return of income. In the above circumstances, the Learned Commissioner of Income Tax(Appeals) has deleted the addition of Rs.8,99,200/- by following the order of this Tribunal passed in the case of Bharatkumar N. Patel (supra). The Learned Departmental Representative could not point out any error in the order of the Learned Commissioner of Income Tax(Appeals). We, therefore, following the order of this Tribunal in the above stated case confirm the order of the Learned Commissioner of Income Tax(Appeals) and dismiss the appeal of the Revenue.
Order pronounced in the court in the presence of the parties on 22-01-2010 Sd/- Sd/-
(T K SHARMA) (N S SAINI)
JUDICIAL MEMBER ACCOUNTANT MEMBER
Date : 22-01-2010
Copy of the order forwarded to :
1. Smt. Kanchanben B Moradia, 13, Upvan Row House, Near Sahaj, Super Store, Adajan, Surat
2. The ACIT, Circle-3, Surat
3. The CIT concerned
4. The CIT(A)-V, Surat
5. The DR, ITAT, Ahmedabad
6. Guard File BY ORDER DY.R/AR, ITAT, AHMEDABAD 5