Income Tax Appellate Tribunal - Delhi
Surender Aggarwal, New Delhi vs Department Of Income Tax on 8 April, 2015
IN THE INCOME TAX APPELLATE TRIBUNAL
DELHI BENCHES : "G" NEW DELHI
BEFORE SMT. DIVA SINGH, JUDICIAL MEMBER
AND
SHRI T.S.KAPOOR, ACCOUNTANT MEMBER
ITA No.1511/Del/2013
Assessment Year : 2009-10
ITO, vs Surender Aggarwal,
Ward-33(3), Room No.- 310-A, Nehru Nagar,
1609, E-2, Civic Centre, Delhi-110008
New Delhi. PAN-ABVPA7039H
(Appellant) (Respondent)
Appellant by Sh.B.R.R.Kumar, Sr. DR
Respondent by Sh. Raj Kumar Gupta, Adv.
& Sh.Saurabh Goyal, CA
Date of Hearing 23.03.2015
Date of Pronouncement 08.04.2015
ORDER
PER DIVA SINGH, JUDICIAL MEMBER
The present appeal has been filed by the Revenue against the order dated 27.12.2012 of CIT(A)-XXVI, Delhi pertaining to 2009-10 assessment year on the following ground:-
1. "The ld. CIT(A has erred in deleting addition of Rs.31,25,000/- u/s 69 of the IT Act on account of unexplained investment in property without appreciating the fact that the assessee could not explain the reasons as to why the property was sold to him on a much lower price than the circle rate."
2. The relevant facts of the case are that the assessee returned an income of Rs. 1,31,403/-. The said return was subjected to scrutiny assessment on the basis of CASS in AIR category. The information generated disclosed that the assessee had purchased immovable property amounting to Rs.33,25,000/- as per the information received from Deputy Commissioner, North Delhi, Sub-Registrar-
I during the Financial year 2008-09 assessment year. In view thereof the assessee was required to file documentary evidence regarding the purchase thereof. In response thereto the assessee as per the assessment order is found to ITA No. 1511/Del/2013 have relied upon the following submissions by way of an affidavit dated 20.10.2011 filed before the AO:-
"1. That I am the owner of premises at 1041/353, Sadora khurd, Anand Parbat, New Delhi-110005.
2. That I have purchased the said property 1041/353, Sadaor Khurd, Anand parbat, New Delhi-110005 min, App area measuring 240 Sq. yds, i.e. 200.64 sq mtrs from Devender Kumar S/o.Shri Rattan Singh R/o.-228, Narela, Delhi on full and final payment amount to Rs.2,00,000/- (Rupees Two Lac only) through cheque No. 050164 on 25/07/2007 drawn on the Vaish Co- operative Adarsh Bank Ltd. and I have paid stamp duty amounting to Rs.1,99,500/- as circle rate of the said property."
2.1. However not convinced with the same the AO again required the assessee to explain why the difference of Rs.33,25,000/- (-) Rs.20,000/-=Rs.31,25,000/- should not be added as assessee's undisclosed investment. Not convinced with the explanation offered the addition of the said amount was made.
3. In appeal before the First Appellate Authority, considering the submissions of the assessee, the CIT(A) came to the following conclusion:-
7.1. "On perusal of the rectification deed it is clear that the consideration which the appellant had paid was Rs.2,00,000/- and not Rs.33,25,000/- as communicated in the AIR information. The AAIR information was generated on the basis of original sale deed dated 19.09.2008 wherein due to a human error the amount of sale consideration was wrongly typed as Rs.33,25,000/-. The appellant submitted that the Assessing Officer had asked to submit the rectified sale deed but when he got the sale deed rectified sale deed but when he got the sale deed rectified on 232.12.2011, the Assessing Officer had already passed the Assessment order u/s 143(3) of the I.T. Act, 1961.
The appellant submitted that it was for this reason that the rectified sale deed could not be produced before the Assessing Officer. In view of these facts, there remains no doubt that the sale deed could not be produced before the Assessing Officer. In view of these facts, there remains no doubt that the sale consideration paid by the appellant was Rs.2,00,000/- and not Rs.33,25,000/-.
7.2. The Assessing Officer in his order has invoked the provisions of Section 50 C of the I.T.Act. 1961. The Assessing Officer has erred in invoking these provisions in the case of the appellant. The provisions of Section 50C was introduced in the context of seller and not in the context of purchaser. Therefore, the Assessing Officer was not justified in invoking the provisions of Section 50 C in the case of the appellant who is a purchaser.
7.3. As regards the addition on account of unexplained investment made by the Assessing Officer by invoking the provisions of Section 69, I find that the Assessing Officer had not gathered any evidence to prove that the appellant had invested more than the value declared in the rectified registered sale deed of the property in question. IN the absence of any material to suggest that the appellant had incurred any excess amount apart from what was stated in the sale deed it is not appropriate 2 ITA No. 1511/Del/2013 to infer that the appellant had made investment in property more than but what was stated in sale deed. Therefore, the Assessing Officer was not justified even in invoking the provisions of Section 69 for making addition in this case on account of unexplained investment from undisclosed sources.
7.4. In view of the facts as discussed above, I do not find any justification to sustain the addition made by the Assessing Officer. Accordingly, the addition of Rs.31,25,000/- made by the Assessing Officer u/s 69 of the I.T.Act, 1961 is deleted."
4. Aggrieved by this the Revenue is in appeal before the Tribunal.
5. The Ld. Sr. DR relied upon the assessment order and the Authorized representative of the assessee apart from relying upon the impugned order, invited attention to the copy of the registered sale deed dated 19.09.2008 placed at page 1-9 of the Paper Book and copy of the registered deed of rectification dated 23.12.2011, copy placed at pages 10-12 of the paper Book. Referring to the same it was his submission that on account of the typographical error by the deed writer the mistake had occurred and since the assessment order was passed on 19.12.2011 the rectification of the registered deed also duly registered on 23.12.2011 could not be placed before the AO. Even otherwise it was argued that section 50C is not applicable in the case of a purchaser in the year under consideration as has been held in Inderlok Hotels (P.) Ltd. vs ITO 122 TTJ (Mum.) 145 and CIT vs Thiruvengadan Investments (P.) Ltd. 320 ITR 345 (mad.) on the basis of which it was submitted that section 50C is applicable only for the purpose of determining the sale consideration for computation of capital gains and it cannot be applied for determining the income under other heads. In the facts of the present case it was also submitted that the specific property is a disputed property. Referring to section 56(2)(vii)(b) it was submitted that it has been inserted w.e.f 01.10.2009 for a property received on or before after 01.10.2009 and in the facts of the present case the property has been purchased on 19.09.2008.
6. We have heard the rival submissions and perused the material available on record. A perusal of the relevant documents i.e Registered Sale Deed dated 19.09.2008 and the Registered Deed of Rectification dated. 23.12.2011 it is seen that the said Rectification Deed was not available before the AO who has proceeded on the basis of the Registered Sale Deed dated 19.09.2008. On a perusal of the same we find that the typographical error is clearly borne out from 3 ITA No. 1511/Del/2013 it as there is contradiction in the consideration mentioned therein also. Accordingly in these circumstances, in the face of the evidence on record which stand unassailed, we find no infirmity arrived at in the impugned order. The fact that the deed writer by mistake recorded the value of the property as per the circle rate which was fixed at Rs.33,25,000/- on which stamp duty of Rs.1,99,500/- was paid was taken is evident from the original sale deed itself at page 6 which has been extracted in the impugned order at page 4:-
"That the entire sale consideration of Rs.33,25,000/- (Rupees Thirty three lacs twenty five thousand only) has already been received by the Vendor from the Vendee vide cheque No.050164 dt. 25.07.2007 amounting to Rs.200,000/- (Rupees Two lac only) drawn on the Vais Co-operative Adarsh Bank Ltd. New Rohtak Road, Karol Bagh, New Delhi-prior to the execution of this Sale Deed, the receipt of which is hereby admitted and acknowledged by the Vendor".
6.1. It is seen that this properly was a disputed proper as per the following submissions advanced before the CIT(A) also extracted at page 4 of the impugned order:-
(v) "The value of the property depends on the Title of the property and this property is under dispute as a person named Jag Jivan is claiming that this property was gifted to him by Mr. Tara Chand, the person who had sold this property to the persons from whom I have purchased. The matter is under hearing at Civil Court (Room No.149), Tis Hazari, Delhi and I am defending myself the next date of hearing is 03.12.2012. (copy of case documents are enclosed)
(vi) The property which is originally a plot of land was trespassed by general public and used to dump garbage of their daily household. There was a great dispute among co-owners of the property. Inspite of repeated efforts of seller(s) nobody was interested in purchasing this property. SO the question of Fair market Value will not work in this particular matter. As per the provisions of Stamp Duty it is on lower side or in higher side."
6.2. The factum of contradiction in the sale consideration wrongly noted by the deed writer as argued by the CIT(A) has been brought out by the assessee before the CIT(A) is evidenced from the following extract:-
7.1. "On perusal of the rectification deed it is clear that the consideration which the appellant had paid was Rs. 2,00,000/- and not Rs. 33,25,000/- as communicated in the AIR information. The AIR information was generated on the basis of original sale deed dated 19.09.2008 wherein due to a human error the amount of sale consideration was wrongly typed as Rs. 33,25,000/-. The appellant submitted that the Assessing Officer had asked to submit the rectified sale deed but when he got the sale deed rectified on 23.12.2011, the Assessing Officer had already passed the Assessment order u/s 143 (3) of the I.T. Act, 1961. The appellant submitted that it was for this reason 4 ITA No. 1511/Del/2013 that the rectified sale deed could not be produced before the Assessing Officer. In view of these facts, there remains no doubt that the sale consideration paid by the appellant was RS.2,00,000/- and not RS.33,25,000/-.
6.3. It is further seen that the CIT(A) while coming to the conclusion in favour of the assessee which has also been extracted in the earlier part of this order has taken into consideration the deed of rectification dated 23.12.2011 copy of which is filed before us and is also extracted in the impugned order itself is reproduced hereunder:-
"I have considered the facts of the case and the submissions of the appellant. I have also perused the copy of sale deed dated 19.09.2008 and copy of deed of rectification dated 23.12.2011 both registered in the office of Sub-Registrar-1 North District Delhi for the sake of convenience it would be appropriate to reproduce the deed of rectification dated 223.12.2011 which is as under:-
Deed of rectification This deed of rectification is made and executed at Delhi on 23.12.2011 between :-
Sh. Davender Kumar S/o Late Sh. Rattan Singh R/o. 228, Narela, Delhi 9 hereinafter called the Vendor) of the one part And Sh. Surender Aggarwal S/o Sh. Amar Nath Aggarwal R/o 310, Nehru Naqar, NEW Delhi (hereinafter called the Vendee) of the other part. The expression of the Vendor and Vendee shall mean and include their respective legal heirs, successors, administrators, assigns. Whereas by a sale deed dated 19/09/2008 made between the same persons as are the parties hereto and in the same order (hereinafter called the principle deed) the vendor transferred to the Vendee a portion of property bearing khasra no. 1041/353 min. app. Area measuring 240 sw.yds i.e. 200.64 sq. mtrs., situated in the area of Village Sadhora Khurd, Delhi State, Delhi now colony known as Anand Parbat, New Delhi
- 110005 (herein after called the Property) and the principle deed has been registered as Document No. 6941, in Addl. Book No. 1, Volume No. 2713, at Pages 58 to 66, on 22/09/2008, with the Sub Registrar, Sub Distt. - 1, Delhi.
And whereas the execution of the said Principal deed has been admitted by the Vendor before the Sub. Registrar and other formalities will be completed within due course.
And whereas from a perusal of the copy of the said Principal Deed it is found at Page no. 5 Clause No. 4, in 4 th line & Page No. 6 Clause no. 1, in 4th line that the actual sale consideration amount was wrongly typed as "Rs. 33,25,000/- (Rupees thirty three lac twenty five thousand only)"
instead of "Rs. 2,00,000/- (Rupees two lac only)" which has already been received by the Vendor from the Vendee through Ch. No. 050164 dt. 25/07/2007, drawn on The Vaish Co-Operative Adarsh Bank Ltd., New Rohtak Road, Karol Bagh, NEW Delhi.
And whereas the Vendee has requested to the Vendor to execute with a view to rectify the said mistake, which the Vendor has agreed to do so. Now this deed witnesseth as hereunder :-
5 ITA No. 1511/Del/20131. That pursuant of the said deed and in consideration of the premises the Vendor doth hereby admit the above said rectification.
2. That all the terms and conditions of the Principal Deed shall remain in same order.
3. That the parties have understand the facts of the said Rectification Deed and the Vendor has been satisfied with the Rectification of the same.
4. That as rectified and modified as aforesaid the principal deed shall remain in full force and effect.
In witness whereof, the parties hereto have signed and affixed their thumb marks on this Sale Deed after understanding the contents of the same on the day, month and year first above written in the presence of the following witnesses."
7. Accordingly in view of the afore-mentioned peculiar facts and circumstances which remain unrebutted on record, we are of the view that in the absence of any infirmity being pointed out in the finding arrived at by the CIT(A) the grounds raised by the Revenue have to be rejected.
8. In the result the appeal of the Revenue is dismissed.
The said order was pronounced in the Open Court on 08th April, 2015.
Sd/- Sd/-
(T.S.KAPOOR) (DIVA SINGH)
ACCOUNTANT MEMBER JUDICIAL MEMBER
Dated: the 08th April, 2015
*Amit Kumar*
Copy forwarded to:
1. Appellant
2. Respondent
3. CIT
4. CIT(Appeals)
5. DR: ITAT
ASSISTANT REGISTRAR
ITAT NEW DELHI
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