IN INCOME TAX APPELLATE TRIBUNAL BENCH, MUMBAI BEFORE HON BLE S/SHRI JOGINDER SINGH (JM), AND RAJESH KUMAR,(AM) I.T.A. No.61/Mum/2014 (Assessment Year :2008-09) Sanjay C Kothari, legal Heir on Income Tax Officer-14(1)(3), nd Vs. 2 floor, Earnest House, behalf of Late Smt Krishna Kothari, Nariman Point, 15-A, Mittal Court, Nariman Point, Mumbai-400021 Mumbai-400021 ( Appellant) .. ( Respondent) PAN No. : AAPPK3528G Appellant by: Shri K Gopal Respondent by Shri Kailash Kanojiya Date of Hearing : 21.7.2016 Date of Pronouncement : 6.10.2016 O R D E R Per RAJESH KUMAR, Accountant Member: This is appeal filed by assessee and it is directed against order of Ld. CIT(A)-25, Mumbai dated 22.10.2013 pertaining to A.Y.2008- 09. 2. issue raised in grounds of appeal no.3 is against confirmation of addition of Rs.23,83,141/- under head Short Term Capital Gains (STCG) on transfer of residential flat by ld. CIT(A) by ITA No 61/M/2014 2 holding that AO without appreciating fact that flat has not actually been transferred during year and under provisions of section 2(47) of Income Tax Act, 1961(hereinafter referred to as Act), therefore, invocation of provisions of section 50C is not justified at all. 3. Facts of case in brief are that assessee filed his return of income on 29.9.2008 declaring total income of Rs.5,97,600/- which was processed under section 143(1) of Act. Thereafter, case was selected for scrutiny and statutory notices were issued u/s 143(2) on 5.8.2009 and u/s 142(1) dated 5.4.2010 were duly issued and served upon assessee. AO during course of assessment proceedings found from balancesheet for assessment yer 2007-08 that sum of Rs.3,38,31,050/- was appearing as advance for property being Gundecha Garden and also received unsecured loan of Rs.33,66,631/- from Shri Sanjay Kothari which was also shown in balancesheet. assessee got possession of said flat on 7.2.2007 and which means assessee got right in said property. However, assessee continued to show advances of property in balanesheet as on 31.3.2007 which was wrong as assessee should have shown in balancesheet purchase of lat and instead. 4. We have carefully considered rival submissions and perused material placed before us including orders of authorities below. On perusal of page 139 of paper book reveals that Smt Krishna Kothari and Sanjay Kothari were co-owners of flat in Gundecha Gardens Co- ITA No 61/M/2014 3 op.Soc Ltd as evidenced by certificated dated 10.6.2008 bearing share certificate no.216, Member s registration No.D-30. assessee died on 13.9.2009 as evidenced by death certificate dated 22.12.2010 issued by Municipal Corporation of Greater Mumber, which is placed at page 141 of paper book. We also note from page No.125 of paper book which is copy of leter addressed to Hon rary Secretary of Society for deletion of name of original (deceased) member informing society that one of co-owner Smt.Krishna Kothari expired on 13.9.2009 requesting society to insert name of Mrs.Meenakshi Sanjay Kothari as second co-owner in record of society in place of deceased co-owner. We have also perused pages 132,134 and 138 which comprises of indemnity bond filed by Mrs.Meenakshi Sanjay Kothari and undertaking of Mrs.Meenakshi Sanjay Kothari, affidavit at page 136 to 138 which is joint affidavit of Shri Sanjay C Kothari, Son of Mrs.Krishna Kothari, Smt. Sangita Dinesh Mohta, Daughte, Mrs. Surekhas Sanjay Mimani, daughter and Mrs.Shalini Girdhri Chandak, daughter and Mrs.Meenakshi Sanjay Kothari, daughter in law requesting society that all legal heirs have left their interest as well claim in shares certificate no.216 as well as residential flat no.1402 in building of society except Shri Sanjay C Kothari who is already holding joint ownership along with deceased joint owner and such his membership should be continued along with his wife. Taking into account all facts and documents filed on record, we find that deceased assessee has not transferred flat in favour of her son Sanjay C ITA No 61/M/2014 4 Kothari and AO has merely quest and imagine on basis of deletion of certain entries in balance sheet of both persons that transfer of flat has taken place and accordingly invoked provisions of section 50C o he Act in order to calculate STCG and added sum of Rs.23,83,145/- in hands of deceased assessee which was confirmed by ld. CIT(A) by upholding finding of AO. In our considered opinion, provisions of section 50C can only be invoked when transfer of property/land/flat has taken place and not otherwise. In view of our observations, order of ld.CIT(A) sustaining addition cannot be sustained. Accordingly, we set aside he ld.CIT(A) and direct AO to delete addition. 5. In result, appeal of assessee is allowed. above order was pronounced in open court on 6th Oct, 2016. 6th Oct,2016 Sd sd (JOGINDER SINGH) ( RAJESH KUMAR) Judicial Member Accountant Member Mumbai: 6 Oct, 2016. th . SRL , Sr. PS Copy of Order forwarded to : 1. Appellant 2. Respondent. 3. CIT(A)- concerned 4. CIT concerned 5. DR, ITAT, Mumbai concerned 6. Guard file. BY ORDER, True copy (Asstt. Registrar) ITAT, Mumbai Sanjay C Kothari v. Income-tax Officer-14(1)(3), Mumbai