Chhaganbhai Muljibhai Patoliya Vs ITO (ITAT Rajkot)
The appeal pertains to the Assessment Year 2012-13, filed by the assessee before the ITAT Rajkot against the orders of the Assessing Officer (AO) and the Commissioner of Income Tax (Appeals) [CIT(A)]. The dispute arose from the assessment completed under sections 143(3) read with 147 of the Income Tax Act, 1961, and subsequent appellate order dated 30 June 2025 by the National Faceless Appeal Centre, Delhi. The issue revolves around capital gains and the application of section 50C of the Act concerning immovable property transactions undertaken during the financial year 2011-12.
The AO, following information received from ITO (I&CI), Rajkot, initiated reassessment proceedings under section 147 via notice under section 148 on 28 March 2019, after recording reasons for reopening with the approval of the Pr. Commissioner of Income Tax. The assessee filed a return on 21 November 2019 declaring income of Rs. 41,870. During the year, the assessee sold five residential plots with a total consideration of Rs. 1,42,333. The stamp duty valuation authority (Jantri rate) valued the properties at Rs. 13,87,414, resulting in a difference of Rs. 12,45,081. This difference was proposed as an addition under section 50C, which deems the higher stamp duty valuation as the full value of consideration for computing capital gains if sale consideration is lower.
