Jitendra Vanigota Vs ITO (ITAT Mumbai)
In the case of Jitendra Vanigota vs ITO, the assessee appealed against an order by the Income Tax Officer (ITO) for the assessment year 2020-21. The core issue revolved around the valuation of an immovable property purchased by the assessee. The property was bought under an agreement made in 2013, with the official registration occurring in 2019. The difference between the actual transaction value of ₹18.32 million and the stamp duty valuation of ₹18.91 million led to a ₹595,000 addition to the assessee’s income under Section 56(2)(x) of the Income Tax Act. The assessee appealed this addition, arguing that the variation was within the allowable tolerance limit of 10%. Moreover, the appeal was filed with a delay of 30 days, which the CIT (A) refused to condone due to lack of sufficient justification from the assessee.
The Mumbai ITAT considered the merits of the case and chose not to focus on the delay issue. The Tribunal ruled that the 10% tolerance limit under Section 56(2)(x) and Section 50C of the Income Tax Act should apply to the transaction. Since the ₹595,000 difference between the transaction value and the stamp duty value was only about 3.25%, well within the permissible limit, the Tribunal deemed the addition to be unjustified. Accordingly, the ITAT ordered the deletion of the addition and ruled in favor of the assessee, reversing the order of the Assessing Officer.
