Nirmal Singh Vs ITO (ITAT Lucknow)
ITAT Lucknow held that addition under section 56(2)(vii)(b) of the Income Tax Act without reference to Valuation Officer, as mandated by law, has not legs to stand and hence is unsustainable in law.
Facts- The assessee had filed the return of income on 30/09/2014, showing total income of Rs.7,81,320/-. Subsequently, notice dated 30/03/2021 was issued u/s 148 of the Act, in compliance whereof the assessee again filed income tax return on 22/04/2021; declaring income of Rs.7,81,320/-again. Vide assessment order dated 30/03/2022 passed u/s 147 r.w.s 144B of the Act, the assessee’s total income was assessed at Rs.2,71,15,320/-. In the aforesaid assessment order, an addition of Rs.2,14,22,053/- was made u/s 56(2)(vii)(b) of the Act and an addition of Rs.49,11,947/- was made towards Short Term Capital Gain (STCG).
CIT(A) dismissed the appeal. Being aggrieved, the present appeal is filed.
Conclusion- The provisions of Section 50C(2) of the Act as well as proviso to Section 56(2)(vii)(b) of the Act; mandate reference by the Assessing Officer to the Valuation Officer when the assessee claims before the Assessing Officer that the value adopted or assessed or assessable Stamp Valuation Authority exceeds the fair market value of the property as on the date of transfer.
