The Tax Publishers2020 TaxPub(DT) 1722 (Rkt-Trib)

INCOME TAX ACT, 1961

Section 143(3)

Where the assessee purchased land from wife at a figure higher than the Jantri Value then such purchase cannot be rejected only such ground particularity where all the necessary facts were duly disclosed by the assessee and assessment was also framed under section 153A/143(3) for the year in which land was purchased.

Assessment - Addition to income - AO doubted transaction of purchase of land from spouse based on difference between purchase price declared by assessee vis-a-vis Jantri Value -

Assessee purchased land from his wife (holding 33% share in the land) at Rs. 734 per square meter whereas Jantri Value was Rs. 200 per square meter. Accordingly, AO doubted the transaction based on difference between purchase price declared by assessee vis-a-vis Jantri Value and held the transaction as a colorable device to reduce tax liability by diverting the income as there was no tax liability arising in the hands of seller being wife of assessee. Held: All the necessary facts were duly disclosed by the assessee and assessment was also framed under section 153A/143(3) for the year in which land was purchased. Thus, no facts were concealed or hidden. Also, transactions carried out by the parties were very much normal transaction there was no reference made by AO suggesting that same were carried out illegally. Moreover, there was no variance in the impugned transaction with regard to the terms of agreement. In view of all these impugned transaction could not be regarded as colorable device merely on the reasoning that there was no tax liability arising in the hands of seller being wife of the assessee.

REFERRED :

FAVOUR : In assessee's favour.

A.Y. :

INCOME TAX ACT, 1961

Section 234B

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