The two member bench of Delhi Income Tax Appellate Tribunal ( ITAT ) directed readjudication after finding that the lower authority failed to examine the ownership and leasehold rights of property sold on behalf of the assessee.
The Assessee, Rajni Dua, deals in the business of manufacturing and sale of Agarbatti, Dhoopbatti and Soap. During the assessment proceeding the AO observed that the assessee transferred a property as per Registered Transfer Deed o f Lease Hold Rights.
As per registered deed Smt. Rajni Dua is the transferor being the General Power o f Attorney Holder of the Property. It was observed that there is a difference in registered value/sale consideration and the circle value as per the stamp duty authorities a sum of Rs.56,38 ,905/- being the difference of the stamp duty value of Rs.72,60 ,000/- and the sale consideration of Rs .16,21 ,095/- is added to the income of the assessee on account of sale o f vacant plot
Aggrieved, the assessee filed an appeal before the CIT(A) who confirmed the addition.Accordingly the assessee filed appeal before the tribunal.
During the adjudication Tarun, the counsel for assessee submitted that the assessee has not purchased the plot and never sold. Smt. Rajni Dua was a director in the M/s LifeTime Buildwell Pvt . Ltd. during the A .Υ. 2009-10
Amit Katoch, Counsel for Revenue supported the order of lower authorities and argued that Sh. Rajveer Singh passed his will dated 10th April 2006 relating to the said property that Smt. Rajni Dua will be the owner o f the property after his death.
Further the Sh. Rajveer Singh signed the General Power of Attorney dated 10th April 2006 in the name of Smt. Rajni Dua to perform the various transactions/activities as mentioned in the General Power of Attorney.
Thus the assessee counsel argued that the will of Sh. Rajveer Singh clearly states that Smt. Rajni Dua will be the owner of the property after his death . Sh. Rajveer Singh was alive when the Transfer Deed of Leasehold Right & Transfer Memorandum were executed through the Power of Attorney
The tribunal observed that core issue of ownership, acquisition of leasehold rights and subsequent sale of property/lease hold rights have not been examined by the revenue nor the assessee has furnished the relevant explanation as to why and how the amounts have been received by the assessee if the property is not owned by her.
After reviewing the facts the ITAT bench of Astha Chandra (Judicial Member) and Dr. B. R. R. Kumar(Accountant Member) directed readjudication after finding that the lower authority failed to examine the ownership and leasehold rights of property sold on behalf of the assessee.
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