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December 2022

44. Amended provisions of section 56(2)(vii)(b) of the Act cannot be applied retrospectively.

By Jagdish Punjabi, Chartered Accountant
Devendra Jain, Advocate
Reading Time 3 mins
Rajib Rathindra Saha. vs. Income-tax Officer (International Taxation)
[2022] 95 ITR(T) 216 (Mumbai - Trib.)
ITA No.: 7352 (Mum.) of 2019
A.Y.: 2014-15
Date of order: 21st February, 2022
Section: 56(2)(vii)(b)

44. Amended provisions of section 56(2)(vii)(b) of the Act cannot be applied retrospectively.

FACTS

The assessee, an individual, paid earnest money for the purchase of an immovable property in 2010. The assessee executed the agreement to purchase the said property on 31st March, 2013 and paid the stamp duty on 18th March, 2013. The property was actually registered on 2nd April, 2014.

In the course of assessment proceedings for A.Y. 2014-15, the AO pointed out the fact that the stamp duty valuation on the date of registration was higher than the cost of acquisition of the property. Accordingly, the said difference was bought to tax u/s 56(2)(vii)(b) of the Act, as amended vide Finance Act, 2013. The assessee requested the AO to refer the matter to the departmental valuation officer (DVO), but the same was rejected and an order was passed making an addition of the difference between the stamp duty value and the cost of acquisition.

Aggrieved, the assessee filed an appeal before the CIT(A). The CIT(A) referred the matter to DVO and directed the AO to re-compute the income of the assessee accordingly.

Aggrieved, the assessee filed further
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