No Penalty for addition merely due to application of deeming Provision U/s. 50C

The assessee sold the property at a sum of Rs. 2,51,50,000/- For the purpose of stamp duty, however, the value was estimated at a sum of Rs. 5,19,77,000/- and on that basis the stamp duty was realized. During the assessment, it was found that the assessee had disclosed the sale price at a sum of Rs. 2,51,50,000/-. The Assessing Officer fixed the sale price at a sum of Rs. 5,19,77,000/ – and started proceedings under Section 271(1) (C). Penalty for a sum of Rs. 30,09,989/-was imposed.

Thus obviously, it is only on account of deeming provisions of section 50C, the AO has made the addition by adopting the sale consideration of Rs.5, 19,77,000/-, being the value adopted for the purpose of stamp valuation. The revenue has also not shown as to how the assessee could be held to have actually received this amount which is in excess of the amount of Rs.2,51,50,000/-. It has also not been shown as to whether any corresponding addition has been made in the hands of the buyer. In any case, the issue is also now squarely covered by the decision of the Coordinate Bench of this Tribunal in the case of Renu Hingorani (supra). In the circumstances, respectfully following the decision of the Coordinate Bench of this Tribunal in the case of Renu Hingorani (supra) as also on account of the fact that the revenue has not been able to dislodge the findings of the ld. CIT(A) that the bona fides of the assessee are genuine, the findings of the ld. CIT(A) stand confirmed. In the circumstances, the appeal of the revenue is dismissed.Mr. Niaumuddin, learned Advocate appearing for the Revenue, contended that the assessee had a choice to dispute the valuation on the basis of the deemed value, but the assessee did not take that opportunity. The assessee had a choice or he could have litigated. The fact remains that the actual amount received was offered for taxation. It is only on the basis of the deemed consideration that the proceedings under Section 27 1(C) started. The revenue has failed to produce any iota of evidence that the assessee actually received one paise more than the amount shown to have been received by him.

IN THE HIGH COURT AT CALCUTTA

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