DCIT, Circle - 55, Kolkata, Kolkata v. Shri Rabindra Nath Banerjee, Kolkata

ITA 1933/KOL/2010 | 2007-2008
Pronouncement Date: 09-09-2011 | Result: Dismissed

Appeal Details

RSA Number 193323514 RSA 2010
Assessee PAN AAEPB6060H
Bench Kolkata
Appeal Number ITA 1933/KOL/2010
Duration Of Justice 10 month(s) 27 day(s)
Appellant DCIT, Circle - 55, Kolkata, Kolkata
Respondent Shri Rabindra Nath Banerjee, Kolkata
Appeal Type Income Tax Appeal
Pronouncement Date 09-09-2011
Appeal Filed By Department
Order Result Dismissed
Bench Allotted B
Tribunal Order Date 09-09-2011
Date Of Final Hearing 09-09-2011
Next Hearing Date 09-09-2011
Assessment Year 2007-2008
Appeal Filed On 12-10-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH: KOL KATA () BEFORE /AND ! . '# . ) [BEFORE HONBLE SRI MAHAVIR SINGH JM & HONBLE SHR I C. D. RAO AM] $ $ $ $ / I.T.A NO. 1933/KOL/2010 %& '( %& '( %& '( %& '(/ // / ASSESSMENT YEAR : 2007-08 DEPUTY COMMISSIONER OF INCOME TAX VS. SRI RABIND RA NATH BANERJEE CIRCLE-55 KOLKATA. (PAN-AAEPB 6060 H) (*+ /APPELLANT ) ( -*+/ RESPONDENT ) FOR THE APPELLANT: SHRI R. K. SAHA FOR THE RESPONDENT: SHRI A. K. GHOSH . / ORDER PER MAHAVIR SINGH JM ( ) THIS APPEAL BY REVENUE IS ARISING OUT OF ORDER OF C IT(A)-XXXII KOLKATA IN APPEAL NO.106/XXXII/09-10/CIR-50/KOL/07-08 DATED 16.06.201 0. ASSESSMENT WAS FRAMED BY DCIT CIRCLE-50 KOLKATA U/S. 143(3) OF THE INCOME TAX AC T 1961 (HEREINAFTER REFERRED TO AS THE ACT) FOR ASSESSMENT YEAR 2007-08 VIDE HIS ORDER DA TED 31.12.2009. 2. THE ONLY ISSUE IN THIS APPEAL OF REVENUE IS AGAI NST THE ORDER OF CIT(A) DELETING ADDITION MADE BY ASSESSING OFFICER U/S. 69B OF THE ACT ON AC COUNT OF DIFFERENCE IN VALUE DISCLOSED AS SALE CONSIDERATION IN SALE DEED AND VALUE DETERMINE D BY STAMP VALUATION AUTHORITY AS WELL AS DVO. FOR THIS REVENUE HAS RAISED FOLLOWING SOLE G ROUND: AS PER ASSESSEES VALUERS REPORT THE BUILT UP ARE A WAS SHOWN 2300 SQ. FT. WHEREAS DVOS REPORT IT WAS 3266 SQ. FT. THE LD. CIT(A) IS ERRED NOT TO CONSIDER THE BUILT UP AREA AS REPORTED BY THE DVO WHILE PASSING HIS ORDER. 3. WE HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUGH FA CTS AND CIRCUMSTANCES OF THE CASE. BRIEF FACTS ARE THAT ASSESSEE FILED ITS RETURN OF I NCOME FOR RELEVANT ASSESSMENT YEAR 2007-08 WHICH WAS ASSESSED U/S. 143(3) OF THE ACT BY ASSESS ING OFFICER VIDE HIS ORDER DATED 31.12.2009 THEREBY MAKING ADDITION BEING DIFFERENC E IN SALE CONSIDERATION PAID BY ASSESSEE AND THE VALUE AS ASCERTAINED BY STAMP DUTY OFFICER AND ALSO DVO TREATING THIS AMOUNT AS INVESTED BY ASSESSEE FROM UNEXPLAINED SOURCES U/S. 69B OF THE ACT. THE ASSESSEE DISCLOSED IN THE RETURN OF INCOME TO HAVE SPENT A SUM OF RS.66 3 2 000/- TOWARDS PURCHASE OF RESIDENTIAL IMMOVABLE PROPERTY SITUATED AT 59 BALLYGUNGE CIRCU LAR ROAD KOLKATA-700 019 FOR WHICH VALUE ASSESSED BY STAMP VALUATION AUTHORITY VALUING THE PROPERTY AT RS. 96 72 000/- ON WHICH STAMP DUTY WAS PAID AT THE TIME OF REGISTRATION. A SSESSEE DID NOT AGITATE THE SAID VALUATION AND 2 ITA 1933/K/2010 SRI RABINDRA NATH BANERJEE A.Y.0 7-08 PAID STAMP DUTY ACCORDINGLY. THE ASSESSING OFFICER REQUIRED THE ASSESSEE TO EXPLAIN THE DIFFERENCE AND ASSESSEE IN HIS WRITTEN SUBMISSION S TATED AS UNDER: IN THE CASE OF PURCHASE OF PROPERTY AT 59 BALLYGU NGE CIRCULAR ROAD KOLKATA-700 019 THIS BEING A FLAT ON THE 6 TH FLOOR HAVING SUPER BUILT AREA OF 3266 SQ. FT. ALON G WITH A PARKING PLACE WAS PURCHASED FOR RS.66 32 000/- ON 0 3.08.2006. THE TRANSACTION WAS MADE BY CHEQUE AND DISCLOSED. HOWEVER FOR THE PUR POSE OF ASSESSMENT OF STAMP DUTY THE REGISTERING AUTHORITY MADE THE VALUATION AT RS. 96 72 000/-. THE DIFFERENTIAL AMOUNT HAS NOT ACTUALLY BEEN PAID BY THE ASSESSEE AND AS S UCH QUESTION OF CONCEALMENT DOES NOT ARISE AT ALL. SUBSEQUENTLY ASSESSING OFFICER INVOKED THE PROVISI ONS OF SECTION 142A OF THE ACT AND REFERRED FOR VALUING THE FAIR MARKET VALUE TO DVO KOLKATA WHO VALUED THE PROPERTY AT RS.97.98 LACS VIDE HIS REPORT DATED 08.12.2009. AS SESSING OFFICER HAS NOT ACCEPTED EXPLANATION OF THE ASSESSEE AND TREATED THE DIFFERE NCE AS UNDISCLOSED INCOME U/S. 69B OF THE ACT BEING UNEXPLAINED INVESTMENT AND MADE ADDIT ION OF RS.31.66 LACS TO THE RETURNED INCOME OF THE ASSESSEE. AGGRIEVED ASSESS EE PREFERRED APPEAL BEFORE CIT(A) WHO DELETED THE ADDITION AFTER CONSIDERING THE CASE LAW OF HONBLE RAJASTHAN HIGH COURT IN THE CASE OF SMT. AMAR KUMARI SURANA VS. CI T (1997) 226 ITR 344 (RAJ) DR. PRAKASH TIWARI VS. CIT (1984) 148 ITR 474(MP) AND I TO VS. SANTOSH KUMAR DALMIA (1994) 208 ITR 337(CAL). AGGRIEVED REVENUE IS NOW IN APPEAL BEFORE US. 4. WE FIND THAT REVENUE HAS RELIED ON ASSESSMENT OR DER VALUATION REPORT OF DVO AND STAMP VALUATION MADE BY STAMP VALUATION AUTHORI TY FOR TREATING THE DIFFERENTIAL AMOUNT BEING UNEXPLAINED INVESTMENT U/S. 69B OF THE ACT. THE LD. COUNSEL FOR THE ASSESSEE BEFORE US NARRATED FIRST OF ALL THAT THE A SSESSING OFFICER HAS NOT REJECTED THE BOOKS OF ACCOUNT BUT ON QUERY FROM THE BENCH WHETH ER ASSESSEE HAS MAINTAINED BOOKS OF ACCOUNT AND PRODUCED BEFORE ASSESSING OFFICER H E CATEGORICALLY STATED THAT NO BOOKS OF ACCOUNT ARE MAINTAINED AND IT IS NOT REQUIRED FO R THE ASSESSEE TO MAINTAIN BOOKS OF ACCOUNT AS SUCH THE ASSESSEE IS NOT IN ANY BUSINESS . WE ARE OF THE VIEW THAT ONCE BOOKS OF ACCOUNT ARE NOT MAINTAINED BY ASSESSEE THERE IS NO OCCASION FOR ASSESSING OFFICER TO REJECT BOOKS OF ACCOUNT BECAUSE BEFORE HIM THERE IS NO BOOKS OF ACCOUNT. IN CASE THE ASSESSEE DOES NOT MAINTAIN BOOKS OF ACCOUNT HE IS TO PUT UP WITH ESTIMATE BY THE AO TO THE BEST OF HIS ABILITY AND NO OTHER COURSE IS LEFT FOR THE AO. HENCE IN THE PRESENT CASE THE AO HAS PROCEEDED TO ASSESS THE INCOME OF THE AS SESSEE ON THE BASIS OF EVIDENCES AVAILABLE BEFORE HIM. ACCORDINGLY WE REJECT THIS PLEA OF THE ASSESSEE THAT ADDITION CANNOT BE MADE INSPITE OF THE FACT THAT THERE IS N O BOOKS OF ACCOUNT MAINTAINED WITHOUT REJECTION OF BOOKS OF ACCOUNT. 3 ITA 1933/K/2010 SRI RABINDRA NATH BANERJEE A.Y.0 7-08 5. ANOTHER ASPECT ARGUED BY LD. COUNSEL FOR THE ASS ESSEE IS THAT THERE IS NO CONSIDERATION BEING DIFFERENTIAL AMOUNT ACTUALLY PA ID BY ASSESSEE AND AS SUCH THE DIFFERENCE IN ACTUAL CONSIDERATION PAID AND ASSESSE D BY DVO OR BY STAMP VALUATION AUTHORITY CANNOT BE CONSIDERED AS UNEXPLAINED INVES TMENT U/S. 69B OF THE ACT. WE FIND FROM THE ASSESSMENT ORDER THAT THE ASSESSING OFFICE R HAS MERELY RELIED ON THE DVOS REPORT VALUATING THE PROPERTY AT RS.97.18 LACS AND VALUATION OF STAMP DUTY AUTHORITY AT RS.97.72 LACS FOR THE PURPOSE OF REGISTRATION. WE ARE OF THE VIEW THAT THE VALUATION REPORT INDICATING FAIR MARKET VALUE DETERMINED BY D VO IS NOT SUFFICIENT MATERIAL ON RECORD TO SHOW THAT THE ASSESSING OFFICER HAS DRAWN REASONABLE INFERENCE THAT ASSESSEE HAS INVESTED MORE AMOUNT FOR THE PURPOSE OF THIS RE SIDENTIAL PROPERTY THEN SHOWN OR DECLARED IN THE RETURN OF INCOME. WE ARE OF THE VIE W THAT HONBLE KOLKATA HIGH COURT IN THE CASE OF SANTOSH KUMAR DALMIA (SUPRA) HAS CATEGO RICALLY HELD THAT THE VALUATION REPORT IS AFTER ALL INFORMATION THAT LEAVES WIDE RO OMS FOR ERROR ON EITHER OF THE SIDES AND IT CANNOT BE THE BASIS OF MAKING ADDITION. APART F ROM THIS THE VALUE DETERMINED BY STAMP VALUATION AUTHORITY IS CLEARLY U/S. 50C OF TH E ACT WHICH IS A DEEMING FICTION AND DEEMING FICTION CANNOT BE APPLIED OR EXTENDED FOR T HE PURPOSE OTHER THAN IT IS ENACTED OR OTHERWISE. THE VALUATION DETERMINED BY DVO IN REFE RENCE TO SECTION 142A OF THE ACT IS MERELY A DVOS REPORT AND AN OPINION WHICH CANNO T BE THE BASIS FOR ADDITION U/S. 69B OF THE ACT IN VIEW OF THE DECISION OF HONBLE RAJAS THAN HIGH COURT IN THE CASE OF SMT. AMAR KUMARI SURANA (SUPRA). FURTHER EVEN HONBLE CALCUTTA HIGH COURT IN THE CASE OF SANTOSH KUMAR DALMIA (SUPRA) HAS HELD THAT VALUATIO N REPORT IS JUST AN OPINION AND FOR MAKING ADDITION U/S. 69 OF THE ACT SOME USEFUL MATE RIAL SHOULD BE MADE BASIS FOR RATIONALE BELIEF AS TO SUPPRESSION OF REAL CONSIDER ATION THAT HAS PASSED IN THE TRANSACTION. HONBLE CALCUTTA HIGH COURT HAS HELD AS UNDER: IN K. P. VARGHESE V. ITO [1981] 131 ITR 597 THE S UPREME COURT HAS OBSERVED THAT UNLESS IT CAN BE SHOWN BY THE DEPARTMENT THAT IN FA CT THE ASSESSEE HAS RECEIVED HIGHER CONSIDERATION THAN RECORDED IN THE INSTRUMENT OF TR ANSFER SECTION 52(2) CANNOT BE APPLIED. IN ANY EVENT THE QUESTION OF VALUATION IS A MATTER OF OPINION AND VALUATION DIFFERS FROM VALUER TO VALUER PROPERTY TO PROPERTY DEPENDING ON THE FACTS AND CIRCUMSTANCES OF EACH CASE. THE VALUER'S REPORT IS AFTER ALL A STAT ISTICAL HYPOTHESIS THAT LEAVES WIDE ROOM FOR ERROR ON EITHER SIDE. IT IS NO USEFUL MATERIAL FOR RATIONAL BELIEF AS TO SUPPRESSION OF REAL CONSIDERATION THAT PASSED IN A TRANSACTION. IN THIS CASE APART FROM THE VALUATION REPORT WHICH WAS RELIED UPON BY THE INCOME-TAX OFFI CER THERE WAS NO MATERIAL BEFORE HIM TO COME TO THE PRIMA FACIE CONCLUSION THAT THE ASSESSEE HAS RECEIVED A HIGHER CONSIDERATION THAN WHAT HAS BEEN STATED IN THE DEE D. THE VALUER'S REPORT COULD BE AT BEST A REASON TO BELIEVE THAT THE CONSIDERATION SH OWN FALLS SHORT OF THE MARKET VALUE. THE QUESTION IS NOT WHAT THE MARKET VALUE IS THE QUESTION IS WHETHER THE ASSESSEE HAS CONCEALED ANY PART OF THE CONSIDERATION AND WHETHER THE ASSESSEE HAS RECEIVED A HIGHER 4 ITA 1933/K/2010 SRI RABINDRA NATH BANERJEE A.Y.0 7-08 PRICE THAN RECORDED IN THE INSTRUMENT OF TRANSFER. UNLESS THAT FACT IS ESTABLISHED AND THERE IS SOME MATERIAL FOR A TENTATIVE CONCLUSION T HAT THERE WAS SUCH SUPPRESSION AND THE ASSESSEE DID NOT DISCLOSE THE FULL CONSIDERATIO N THE ASSESSMENT CANNOT BE REOPENED. IN OUR VIEW THE LEARNED JUDGE ON THE FACTS OF THI S CASE CAME TO A CORRECT CONCLUSION. IN THAT VIEW OF THE MATTER THIS APPEAL FAILS AND I S DISMISSED. THE NOTICE UNDER SECTION 148 OF THE ACT AND THE ASSESSMENT ORDER MADE PURSUA NT TO THE SAID NOTICE SHALL STAND SET ASIDE AND QUASHED. IN VIEW OF THE ABOVE FACTS WE ARE OF THE VIEW THAT APART FROM DVOS REPORT AND VALUATION OF STAMP DUTY AUTHORITY THERE IS NO MATE RIAL BEFORE THE AO TO COME TO PRIMA FACIE CONCLUSION THAT THE ASSESSEE HAS RECEIVED A H IGHER CONSIDERATION THAN THAT STATED IN THE SALE DEED. ENTIRE BURDEN IS ON REVENUE TO PROV E THAT THE ASSESSEE HAS PAID HIGHER CONSIDERATION FOR MAKING ADDITION U/S. 69B OF THE A CT. ACCORDINGLY WE UPHOLD THE ORDER OF CIT(A) AND THIS ISSUE OF REVENUES APPEAL IS DISMISSED. 6. IN THE RESULT APPEAL OF THE REVENUE IS DISMISSE D. 7. ORDER PRONOUNCED IN OPEN COURT. SD/- SD/- . '# '#'# '# . ! (C. D. RAO) (MAHAVIR SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER ( #! #! #! #!) )) ) DATED 9 TH SEPTEMBER 2011 /0 %12 3 JD.(SR.P.S.) . 4 5 '6- COPY OF THE ORDER FORWARDED TO: 1 . *+ / APPELLANT DCIT CIRCLE-55 KOLKATA. 2 -*+ / RESPONDENT SHRI RABINDRA NATH BANERJEE 59 BALL YGUNGE CIRCULAR ROAD KOLKATA-700 019 3 . .% ( )/ THE CIT(A) KOLKATA 4. .% / CIT KOLKATA 5 . => % / DR KOLKATA BENCHES KOLKATA - / TRUE COPY .%?/ BY ORDER 2 /ASSTT. REGISTRAR .