ITAT Ahmedabad: ITO Vs Roopsingh Bhupal Singh
The Income Tax Appellate Tribunal (ITAT), Ahmedabad Bench, has delivered a significant ruling concerning additions made under Section 69 of the Income Tax Act, 1961. In the case of ITO Vs Roopsingh Bhupal Singh, the Tribunal held that a mere discrepancy between the value stated in an initial Agreement to Sell and the final Registered Sale Deed does not constitute sufficient ground for making an addition on account of unexplained investment. The ruling emphasizes that without concrete evidence proving that the assessee paid consideration over and above the registered value, the Revenue cannot presume unexplained expenditure.
Background of the Dispute
The legal controversy emerged from the return of income filed by the assessee, an individual, for the Assessment Year (AY) 2012-13. The assessee had declared a total income of Rs. 3,38,120/-.
During the verification of records, the Assessing Officer (AO) identified a property transaction involving the purchase of agricultural land by the assessee jointly with his spouse. The scrutiny revealed a substantial variance in the transaction value:
- Initial Sale Agreement: The preliminary agreement indicated a sale consideration of Rs. 5,22,50,000/-.
- Registered Sale Deed: The final conveyance deed reflected a purchase price of only Rs. 25,25,000/-.
The difference between the two figures stood at Rs. 4,97,25,000/-.