THE
issues before the Bench are - Whether the value declared before the Settlement
Commission by the seller of the property can bind the purchasers and whether
when the purchaser of the property declares the difference between the value of
the property and the amount shown in its return of income before the Settlement
Commission, the same amounts to concealment of income. And the verdict goes
against the Revenue.
The assessee is
the wife of Mr. Gopal Gupta who was inducted as a director in a company known as
D.J. Infrastructure Developers (P) Ltd., which was allotted hotel land at
Motia Khan, New Delhi in an auction by the Delhi Development Authority.
Thereafter shares were allotted to Gopal Infrastructures (P) Ltd., a
group company of Gopal Gupta Group in the DJI. The total cost of land in the
books was shown to be Rs 90 crores., however, the AO considered the valuation at
Rs 130 crores including a premium computed at Rs 40 crores . It was also the
case of the Revenue that since 1/3rd of the shares in DJI were acquired by Gopal
Infrastructures the share of the premium would be Rs 13.3 crores which was
supposed to be paid by Sh. Gopal Gupta and his wife to the other Group from whom
the said shares were acquired.
The
issue was taken to the Settlement Commission which passed an order accepting the
figure of Rs 16 crores.
In a
writ, the Revenue contended that the sellers of the 1/3 rd share in the property
had disclosed Rs 16 crores on this account in their statement of facts before
the Settlement Commission, whereas the purchasers had disclosed only Rs 7.6
crores . The Revenue contended that this clearly amounted to non-disclosure of
income and should not have been accepted by the Settlement Commission.
The
Counsel of the assessee submitted that the assessee and her husband had acquired
1/3 rd share in the property amounting to Rs 44.34 crores. Only an investment of
Rs 36.73 crores was disclosed in their books and the remaining amount of Rs 7.61
crores was declared before the Settlement Commission. The Counsel also contended
that going by the valuation of 1/3 rd share purchased by the assessee and her
husband, as shown by the Revenue, this would create discrepancy in the valuation
of the property amounting to Rs 158.9 crores as against Rs 133 crores , which
has not been challenged by the Revenue itself.
Having heard the parties,
the High Court held that,
++ we
are of the view that the impugned order dated 21.05.2012 does not call for any
interference. The fact that Smt. Lata Jain and Sh. Roshan Agarwal had together
declared a sum of Rs 16 crores as undisclosed income in respect of the said
transaction cannot, in our view, bind the respondent No.1 and her husband Sh.
Gopal Gupta. The respondent No.1 and Sh. Gopal Gupta were not privy to the
settlement application filed on behalf of Smt. Lata Jain and Sh. Roshan Agarwal
. In any event, what the Settlement Commission has said in the order in respect
of Smt. Lata Jain and Sh. Roshan Agarwal , is that as per their calculations the
premium amount came to Rs 13.3 crores but since the applicants therein (Smt.
Lata Jain and Sh. Roshan Agarwal ) had declared more than that, the disclosure
needed no disturbance. It was also noted that Sh. Gopal Gupta had surrendered a
lesser amount of Rs 6.5 crores . We may point out that Rs 6.5 crores had been
disclosed in the initial statement given by Sh. Gopal Gupta at the time of the
search and seizure operation and the figure was subsequently enhanced to Rs 7.61
crores at the time the application for settlement was made before the Settlement
Commission. The Settlement Commission in its order dated 31.12.2010 did not fix
any figure as to the amount of undisclosed amount. It only stated that since the
amount declared by the applicants therein (Smt. Lata Jain and Sh. Roshan Agarwal
), was much more than what had been surrendered by Sh. Gopal Gupta and what had
been computed by the Department, the disclosure made by them needed no
disturbance.
++ it
is evident from the discussion above that there is no dispute that the value of
the property in question, even as per the Revenue, was Rs 130 crores. If a
further sum of Rs 3 crores was added to it, to which nobody objected, by way of
registration charges, the value would be Rs 133 crores. 1/3rd of this would come
to Rs 44.34 crores. The respondent No.1 and her husband had disclosed Rs 36.73
crores as investment in the said property leaving a balance of Rs 7.61 crores
which they declared as undisclosed amount in their settlement application. In
other words, the full value of the 1/3rd share in the property has been
accounted for. The Revenue cannot attempt to add anything more to this value in
the absence of any concrete evidence. If the stand taken by the Revenue were to
be accepted, then the value of the property, as mentioned above, would come to
Rs 158.19 crores , which, as pointed out by Mr Tripathi , is nobody's case. In
any event there is not an iota of evidence to indicate that the value of the
property was anything but Rs 130 crores
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