Nikita Jenishkumar Patel Vs ITO (Gujarat High Court)
The Gujarat High Court heard two petitions arising from reopening of assessment proceedings relating to the sale of immovable property situated at Revenue Survey No.4/A, Block No.10/A, Moje Abrama, Taluka Kamrej, Surat, sold on 06 February 2012 by six co-owners. The petitions challenged notices issued under Section 148 of the Income Tax Act for Assessment Year 2012-13.
The petitioners and other co-owners had executed a sale deed for Rs.1,42,17,840/-, while the market value for stamp duty purposes was Rs.3,76,46,896/-, resulting in a difference between sale consideration and jantri value. The Assessing Officer sought to invoke Section 50C of the Act on this basis. One petitioner had filed a return declaring total income of Rs.21,23,670/- and disclosed capital gains arising from sale of properties including the subject property. The case was selected for scrutiny and notices under Sections 143(3) and 142(1) were issued seeking details regarding the transaction, computation of income, purchase deeds, exemption claimed under Section 54B, and supporting documents.
The petitioner furnished detailed replies, including registered sale deeds, valuation reports, purchase deeds for agricultural land purchased for claiming exemption under Section 54B, and bank records. During assessment proceedings, the Assessing Officer specifically questioned why jantri value should not be adopted for computation of capital gains. The petitioner replied that the valuation difference related to Block No.9 and not Block No.10A, and submitted valuation reports and justifications regarding adverse features affecting the price of Block No.9 land. Thereafter, the Assessing Officer passed an order under Section 143(3) making an addition of Rs.72,245/- relating to Block No.9 and did not apply Section 50C to Block No.10A and 10B.
