Gun Sagar Build Estate Vs ITO (ITAT Jaipur)
Jaipur ITAT Deletes Addition for Alleged Undisclosed Property Sales Already Offered to Tax in Earlier Year
The Jaipur ITAT allowed the assessee’s appeals for AYs 2016-17 and 2017-18, holding that sale proceeds already forming part of the disclosed turnover and subjected to tax in an earlier assessment year cannot be taxed again merely because the sale deeds were registered in a subsequent year.
For AY 2016-17, the Assessing Officer treated ₹60.52 lakh as undisclosed sales based on the date of registration of the sale deed. The assessee, however, demonstrated through the sales ledger, audited financial statements and the return of income for AY 2015-16 that the transaction had already been recognised as part of the gross turnover in the earlier year and the resultant business income had been offered to tax. The Tribunal accepted the explanation, observing that the revised return for AY 2015-16 had been filed after the registration of the sale deed, explaining why the registration date appeared in the narration of the earlier year’s sales ledger. It held that once a receipt has formed part of the disclosed turnover and has been subjected to tax, it cannot be brought to tax a second time, and accordingly deleted the addition of ₹60.52 lakh.
Applying the same reasoning to AY 2017-18, the Tribunal found that sales aggregating ₹81.34 lakh relating to four purchasers had already been included in the disclosed turnover of AY 2016-17, as evidenced by the audited accounts, sales ledger and return of income. Since the receipts had already been taxed in the earlier year, the Tribunal held that the Revenue could not tax the same amount again merely because the registration took place later. It therefore deleted the addition of ₹81.34 lakh as well. Both appeals were allowed.
FULL TEXT OF THE ORDER OF ITAT JAIPUR
