Case Law Details
Smt. Nalini Anilbhai Amin Vs DCIT (ITAT Ahmedabad)
The proceedings, in the instant case, under section 147 of the Act were initiated by the AO on account of escapement of income of the capital gain generated on the sale of the property. This fact can be verified from the reasons recorded by the AO for initiating the proceedings under section 147 of the Act which is placed on page 16 of the paper book. However, the AO has made the addition for Rs. 1,55,01000.00 under the provisions of section 56(2)(vii)(a) of the Act on account of the money received by the assessee without consideration. As per the AO, the money has been received by the assessee without any consideration and therefore the same should be treated as income of the assessee under the head income from other sources under the provisions of section 56(2)(vii)(a) of the Act. The addition made by the AO came to be confirmed by the learned CIT (A) in part.
As per the learned AR for the assessee, the basis on which the proceeding under section 147 of the Act were initiated did not survive as there was no addition made in the assessment proceedings qua to that reason. Accordingly, the learned AR contended that the AO cannot make any addition under any other head as the basis for reopening the assessment under section 147 of the Act did not survive.
As per the Revenue the amount of sale consideration received by the assessee stands at ₹3,05,010,00.00 whereas the assessee has disclosed of sum of ₹1.50 crores in the books of accounts against the sale of the property. Thus, it is apparent that the amount which has not been disclosed by the assessee represents the sale consideration of the property which can be subject to tax under the provisions of section 48 of the Act. Furthermore, the assessee has shown the sale consideration of ₹1.50 crores under the head capital gain and the amount in dispute directly relates to the same property and therefore the same can only be brought to tax under the head capital gain. In other words, the same cannot be made subject to the tax under the provisions of section 56 of the Act. In our humble understanding, the principles laid down by the ITAT in the own case of the assessee (Supra) are directly applicable to the issue on hand. Hence, we are of the view that the initiation of the proceedings under section 147 of the Act are bad in law. Hence, the ground of appeal of the assessee is allowed.
As we have decided the issue in favour of the assessee on the technical ground raised by her by holding that the assessment proceedings under section 147 of the Act are invalid, accordingly, we do not find reason to adjudicate the issue raised by the assessee on merit. As such the issues raised by the assessee on merit become infructuous.
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