The Commissioner Of Income Tax, Faridabad v. Chandni Bhuchar

ITA No. 653 of 2009 1 IN THE HIGH COURT OF PUNJAB AND HARYANA ATCHANDIGARH ITA No. 653 of 2009Date of decision: 7.1.2010 The Commissioner of Income Tax, Faridabad Versus ...Appellant 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.for the appellant-Revenue. 1.To be referred to the reporters or not?2.Whether the judgment should be reported in the Digest?2.Whether the judgment should be reported in the Digest? M.M.KUMAR,J. The instant petition filed by the Revenue under Section 260-Aof the Income-tax Act, 1961 is directed against the order dated 27.2.2009passed by the Income Tax Appellate Tribunal, Delhi Bench (for brevity `theTribunal') in ITA No. 1580/Del/2008 for the assessment year 2004-05 inrespect of assessee-respondent. There is categorical finding recorded by the Commissioner of Income Tax (Appeals) [for brevity `CIT(Appeals)] holding that valueadopted or assessed by any authority of the State Government for thepurpose of payment of stamp duty in respect of land or building cannot betaken as sale consideration received for the purpose of Section 48 of theAct. As against the purchase price disclosed in the sale deed at Rs.17,06,700/-, the Assessing Officer has adopted the purchase price of theproperty at Rs. 30,32,000/-, which is assessed for the purpose of paying the ITA No. 653 of 2009 2 stamp duty. Accordingly, it was held that the assessee must have paidRs.13,25,300/- over and above the purchase price disclosed in the sale deedand the Assessing Officer made addition of this difference as income fromunexplained sources. The CIT (Appeals) deleted this addition by holdingthat Section 50-C is a deeming provision for the purpose of bringing to taxthe difference as capital gain. The CIT(Appeals) further held that in theabsence of any legally acceptable evidence, valuation done for the purposeof Section 50-C would not represent actual consideration passed on to theseller. He placed reliance on the judgment of Allahabad High Courtrendered in the case of CIT vs. Raj Kumar Bimla Devi and others 279ITR 360. In that case Allahabad High Court has relied upon theobservations made by Hon'ble Supreme Court in the case of JawajeeNagnatham vs. Revenue Divisional Officer (1994) 4 SCC 595 to hold thatthe Basic Valuation Register prepared and maintained for the purpose ofcollecting stamp could not form the foundation to determine the marketvalue 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 factand in each case the prevailing market value as on the date of notificationpublished in the State Gazette under Section 4(1) of the Act has to beproved. The Tribunal also held that valuation done by any State Agency forthe purpose of stamp duty would not ipso facto substitute the actual saleconsideration as being passed on to the seller by the purchaser in theabsence of any admissible evidence. The Assessing Officer is obliged tobring on record positive evidence supporting the price assessed by the StateGovernment for the purpose of stamp duty. The view of the Tribunal isclear from para 7 of the its order, which reads thus:- ITA No. 653 of 2009 3 ITA No. 653 of 2009 3 “From a plain reading of this provision, it emerges out that thevalue adopted or assessed by any authority of a StateGovernment for the purpose of payment of stamp duty inrespect of land or building or both, shall for the purpose of sec.48 be deemed to be the full value of the consideration receivedor accruing as a result of transfer. It nowhere provides that thevaluation done by the State Government for the purpose ofstamp duty etc. would ipso facto take place the actualconsideration as being passed on to the seller by the purchaserin the absence of any other evidence. The Assessing Officer isrequired to bring positive evidence on record indicating the factthat assessee has paid anything more than the one disclosed inthe purchase deed. The department has taken an argument inthe grounds of appeal that Assessing Officer should be directedto make a reference to the Valuation Officer under sec. 142A ofthe Act. It also raised a plea that Assessing Officer haswrongly made a reference of sec. 50-C while making theaddition, in fact, the addition is made under sec. 69-B onaccount of unexplained investment in the property. We havetaken cognizance of both these arguments. It is the AssessingOfficer who himself ought to have collected the evidenceindicating the fact that assessee has paid more money than theone disclosed in the purchase deed. The ITAT while sitting inthe second appeal is not supposed to give directions on theappeal of revenue that a reference to the Valuation Officer is tobe made in order to substantiate the addition. The steps which ITA No. 653 of 2009 4 Assessing Officer could have taken, if not taken then thatlacuna cannot be filled up at the end of the ITAT. In theabsence of any evidence exhibiting the fact that assessee hasmade unexplained investment in the house property, noaddition can be justified. Learned Ist Appellate Authority hasappreciated 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 consideredview that the view taken by the Tribunal while accepting the order of theCIT (Appeals) does not suffer from any legal infirmity. The argument of the learned counsel for the revenue that theTribunal should have asked the Assessing Officer to make a reference to theValuation Officer under Section 142A of the Act does not require anydetailed consideration because CIT(A) had sent the evidence produced bythe assessee to the Assessing Officer for his comments. He conducted aninquiry and asked the assessee-respondent to produce original bankstatement. Then he sent a reply to the CIT(A) authenticating the wholetransactions. Thereafter the CIT(A) and the Tribunal have accepted saleconsideration depicted in sale deed as fact. The assessee-respondent hasdischarged the burden of proving the sale consideration as projected in thesale deed. Moreover, the learned counsel for the revenue has not been ableto point out that the view taken by the Allahabad High Court in RajKumar Bimla Devi's case (supra) has been challenged before Hon'bleSupreme Court and the same has been rejected. The aforesaid view seemsto have acceptance of the appellant. It that be so then the principle of ITA No. 653 of 2009 5 consistency would require that the aforesaid view be followed as thecorrect view. Accordingly, we are of the view that no question of law muchless substantial question of law warranting admission of the appeal wouldarise for determination of this Court. Dismissed. (M.M.KUMAR) JUDGE 07.01.2010mk (JITENDRA CHAUHAN)JUDGE