Krishna Deep Builders Vs ITO (ITAT Mumbai)
The Mumbai Bench of the Income Tax Appellate Tribunal decided cross appeals filed by the assessee and the Revenue against the order of the Commissioner of Income Tax (Appeals), NFAC, for Assessment Year 2017-18. The assessee challenged the reopening of assessment, the addition of ₹32,78,500 under Section 56(2)(vii)(b) on account of the difference between the stamp duty value and the actual sale consideration of an immovable property, and contended that the property was situated in a no-development zone without municipal road access. The Revenue challenged the deletion of an addition of ₹87,93,925 made under Section 69 relating to the source of investment in the property.
The assessee had originally filed its return declaring nil income. The assessment was reopened through notice under Section 148 following an order under Section 148A(d) on the ground that the assessee had purchased an immovable property for ₹80 lakh whereas its stamp duty value was alleged to be ₹1,12,78,500, resulting in an alleged escaped income of ₹32,78,500. The Assessing Officer completed the reassessment by making additions of ₹32,78,500 under Section 56(2)(vii)(b) and ₹87,93,925 under Section 69 read with Section 115BBE. The CIT(A) upheld the addition under Section 56(2)(vii)(b) while deleting the addition under Section 69 after accepting the documentary evidence regarding the source of investment.
