The Chennai bench of the Income Tax Appellate Tribunal (ITAT) has held that revisional order under section 263 can’t be simply on assumption.
The Appellant was represented by Shri R. Vijayaraghavan and the Respondent was represented by Shri Guru Bashyam.
The assessee challenged the revision order of Principal Commissioner of Income Tax, Chennai-3 passed u/s. 263 of the Income-tax Act, 1961 (the Act) dated 27.03.2021.
The assessee, Smt. Kalyani Seetharaman filed a return of income on 05.08.2016 and the assessment was framed u/s. 143(3) of the Act after considering all the documents, and details filed by the assessee. PCIT noted that the assessee admitted sale consideration of Rs. 6,01,47,000/- towards the sale of his property as against the value adopted by the sub-registrar for the purpose of charging stamp duty at Rs. 9,51,20,528/-
The PCIT observed that the AO failed to invoke section 50C of the Act and has allowed the market value and indexation in respect of sold property as claimed by the assessee without proper verification.
It was contended that the sale consideration of Rs. 6,01,47,000/- was reasonable and represent the fair market value of the property. PCIT has not accepted the claim of the assessee but passed a cryptic order and set aside the assessment order
The Tribunal observed that the revisional order was the applicability to provisions of section 50C of the Act, where there was a difference between the sale consideration as per sale deed and guideline value fixed by stamp valuation authority and because the guideline value is higher than the sale consideration as shown in the sale deed, which cannot be a reason for holding that the assessment is erroneous and prejudicial to the interest of revenue.
Shri Mahavir Singh, vice president, and Shri G Manjunatha, accountant member quashed the revisional order passed as the PCIT has ignored the valuation report of an approved valuer filed with the AO along with the photographs and survey plan and then framed assessment. The appeal was allowed
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