Javidbhai Ahemadbhai Mansuri Vs ITO (ITAT Ahmedabad)
According to ITAT, for property transactions, the stamp duty value on the date of the agreement may be considered under Section 56(2)(x) if part of the payment is made through banking channels at that time, preventing unnecessary tax on the difference between stamp duty and consideration.
The Income Tax Appellate Tribunal (ITAT), Ahmedabad, in the case of Javidbhai Ahemadbhai Mansuri Vs ITO, allowed the appeal of the assessee, effectively deleting an addition of Rs. 73,66,836 made by the Assessing Officer (AO) under Section 56(2)(x)(b) of the Income-tax Act, 1961 (the Act). The core issue revolved around the applicability of this section—which deals with the taxation of certain receipts of immovable property for inadequate consideration—when the agreement for property transfer and partial payment were made years before the final registration date.
Key Facts and Background
The case pertains to the Assessment Year 2020-21. The assessee, Mr. Javidbhai Ahemadbhai Mansuri, had his case selected for Limited Scrutiny to inquire into investments in properties.
The central transaction involved the purchase of a property for a declared consideration of Rs. 29,96,836. However, the property was registered on October 30, 2018, at a Stamp Duty Value (SDV) of Rs. 1,03,63,816. The significant difference between the declared consideration and the SDV amounted to Rs. 73,66,836.
