IN INCOME TAX APPELLATE TRIBUNAL DELHI BENCH SMC-2 , NEW DELHI BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER I.T.A. No. 6023/DEL/2015 A.Y. 2009-10 Mr. MANOJ SINGHAL, DCIT, CIRCLE 14(2), H.NO. 9-10, SARASWATI KUNJ, VS. NEW DELHI 8, ALIPUR ROAD, CIVIL LINE, NEW DELHI 110 054 (PAN: AOZXPS8161B) (APPELLANT) (RESPONDENT) Assessee by : Sh. V.K. Gupta, CA Department by : Sh. Umesh Chander Dubey, Sr. DR ORDER PER H.S. SIDHU, JM Assessee has filed Appeal against Order dated 28.8.2015 passed by Ld. Commissioner of Income Tax (Appeals) V, New Delhi pertaining to assessment year 2009-10 2. grounds raised by assessee read as under:- 1. That Ld. CIT(A) was not justified in adopting fair market value (FMV) value of property Rs. 88,50,000/- instead of Rs. 80,00,000/- as per sale deed of property sold. 2. That Ld. CIT(A) have erred in accepting calculation of FMV calculated based on average of three comparable actual sale instances which includes 2 instances of Adjacent Shakti Khand II instead of based on I sale instance since all important parameters match with that of property sold out by appellant. ITA NO.6023/DEL/2015 3. Ld. CIT(A) was not justified in accepting parameters given in sale instance I of DVBO s valuation report which mostly matched with property sold out by appellant. 4. Any other ground before or at time of hearing of appeal. 3. brief facts of case are that assessee filed return of income on 24.9.2009 declaring total income of Rs. 9,98,234/-. This return was revised subsequently during course of assessment proceedings on 23.6.2010 to declare total income of Rs. 20,28,330/-. revised return was filed to include Short Term Capital Gain of Rs. 10,30,000/- on sale of property representing plot No. 384, Niti Khand, Phase-I, Indrapuram, Distt. Ghazaibad. sale consideration for purposes of computation of capital gains was declared as Rs. 80,00,000/- as shown in sale deed. There is no dispute regarding purchase consideration. Since stamp duty had been paid on sale consideration of Rs. 1,05,95,028/-, assessee was show caused as to why full value of consideration may not be taken as per stamp duty valuation as against Rs. 80,00,000/- shown in sale deed. To this query assessee pointed out that stamp duty had been paid corresponding to stamp duty valuation of Rs. 1,02,86,000/- whereas in AIR, it had been incorrectly shown at Rs. 1,05,95,028/-. As per Valuation Report of Registered Valuer Fair Market Value on 24.6.2008 was arrived at Rs. 78,71,850/-. assessee s contention was that since sale consideration had been shown at Rs. 80,00,000/- in his revised return, same may be accepted. final contention of assessee was that, in accordance with certain judicial rulings, it is incumbent on part of AO, to refer matter to Valuation Officer whenever valuation as per Stamp Valuation Authority is not accepted by transferor of property. AO proceeded, however, to apply deeming provisions of Section 50C and computed Short Term Capital Gains based on assessment of Stamp 2 ITA NO.6023/DEL/2015 Valuation Authority. AO assessed income at Rs. 43,14,230/- u/s. 143(3) of I.T. Act, 1961 on 21.11.2011 by making addition on account of Short Term Capital Gain. 4. Against assessment order dated 21.11.2011, assessee appealed before Ld. CIT(A), who vide impugned order dated 28.8.2015 has partly allowed appeal of assessee. 5. Aggrieved with aforesaid order of Ld. CIT(A), assessee is in appeal before Tribunal. 6. Ld. Counsel of assessee during hearing, has stated that issue in dispute is squarely covered by decision of Hon ble Supreme Court of India in case of CN Gautam vs. Union of India (1993) 199 ITR 0530 which has been followed by various Benches of Tribunal. Therefore, he requested that Appeal of Assessee may be allowed by following precedents. In order to support his contention he filed photocopies of orders of Tribunal and Hon ble Supreme Court of India. 7. On contrary, Ld. DR opposed request of Ld. Counsel of assessee and relied upon orders of authorities below. 8. I have heard both parties and perused relevant records available with me, especially orders passed by revenue authorities alongwith case laws referred by ld. Counsel of assessee. I note that Assessee has established difference between value adopted by Stamp Valuation Authority and declared by assessee is less than 10% and therefore, issue is squarely covered by decision of Hon ble Supreme Court of India in case of CB Gutam vs. UOI & Ors. (1993) 199 ITR 0530. 3 ITA NO.6023/DEL/2015 8.1 I further find that aforesaid decision of Hon ble Supreme Court of India has been followed by various Benches of Tribunal including Jaipur Bench in case of Smt. Sita Bai Khetan vs. ITO passed in ITA No. 826/JP/2013 (AY 2010-11) on 27.7.2016. relevant para of Tribunal s order is reproduced below for sake of clarity as under:- 4. Ground No. 2 is with regard to adopting sale consideration at Rs. 6,12,70,120/- against sale consideration of Rs. 6,00,000/- adopted by assessee. Ld. Counsel for assessee submitted that difference between sale consideration of property as per registered Sale Deed as against value adopted by Stamp Valuation Authority was Rs. 12,70,120/- i.e. 2.11 %. Since difference was within tolerabie limits, which is 15% of variation, as recognized by Hon'ble Supreme Court in case of C.B. Gautam vs. Union of India & Ors. (1993) 199 ITR 530, no addition should be made. This decision has been followed by Coordinate Bench in case of Rahul construction vs. DCIT in ITA No. 1543/PN/2007 (2010) 38 DTR (Pune Trib.). 4.1. On contrary, Id. D/R opposed submissions of assessee on this issue. 4 ITA NO.6023/DEL/2015 4.2. We have heard rival contentions and perused material available on record. We find that Hon'ble Coordinate Bench in ITA No. 1543/PN/2007 in case of Rahul Construction vs. DCIT (supra) has held as under :- " We find that Pune Bench of Tribunal in case of Asstt. CIT vs. Harpreet Hotels (P) Ltd. vide ITA Nos. 1156-1160/Pn/2000 and relied on by learned counsel for assessee had dismissed appeal filed by Revenue where CIT (A) had deleted unexplained investment in house construction on ground that difference between figure shown by assessee and figure of DVO is hardly 10 per cent. Similarly, we find that Pune Bench of Tribunal in case of ITO vs. Kaaddu Jayghosh Appasaheb, vide ITA No. 441/Pn/2004 for asst. yr. 1992-93 and relied on by learned counsel for assessee following decision of J&K High Court in case of Honest Group of Hotels (P) Ltd. vs. CIT (2002) 177 CTR (J&K) 232 had held that when margin between value as given by assessee and Departmental valuer was less than 10 per cent, 5 ITA NO.6023/DEL/2015 difference is liable to be ignored and addition made by AO cannot be sustained. Since in instant case such difference is less than 10 per cent and considering fact that valuation is always matter of estimation where some degree of difference is bound to occur, we are of considered opinion that AO in instant case is not justified in substituting sale consideration at Rs. 20,55,000/- as against actual sale consideration of Rs. 19,00,000/- disclosed by assessee. We, therefore, set aside order of CIT(A) and direct AO to take Rs. 1,90,000/- only as sale consideration of property. grounds raised by assessee are accordingly allowed. In instant case, difference between valuation adopted by Stamp Valuation Authority and declared by assessee is less than 100%. Therefore, respectfully following decision of Hon ble Coordinate Bench, we hereby direct AO to adopt 6 ITA NO.6023/DEL/2015 value as declared by assessee. gorund of assessee is allowed. 8.2. In background of aforesaid discussions and respectfully following precedents, as aforesaid, I decide issues in dispute in favour of assessee and against Revenue. 9. In result, Appeal filed by Assessee stands allowed. Order pronounced in Open Court on 17/10/2016. SD/- [H.S. SIDHU] JUDICIAL MEMBER Date: 17/10/2016 SRBHATNAGAR Copy forwarded to: - 1. Appellant 2. Respondent 3. CIT 4. CIT (A) 5. DR, ITAT TRUE COPY By Order, Assistant Registrar, ITAT, Delhi Benches 7 Manoj Singhal v. DCIT, Circle-14(2), New Delhi