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Since the amount of Rs. 12 crores have been taken by assessee as loan from the Bank through the respective agreements referred to above, therefore, it could not be treated as undisclosed income of the assessee. The assessee has explained source of Rs. 12 crores through the loan taken from the Bank.

Shanti Prime Publication Pvt. Ltd.

Section 56(2), 69B of Income Tax Act, 1961— In the instant case, assessee challenged the addition of Rs. 28,65,00,000/- under section 56(2)(vii)(b) and u/s 69B of the act made by CIT(A).

The A.O. on perusal of the Memorandum of Family Settlement (MFS) noted that assessee has acquired the Bungalow due to relinquishment of rights in the said property by three brothers of the assessee for Rs.NIL.

In this case since amount of Rs. 4 crore is paid to each of three brothers in lieu of their relinquishing 1/3rd ownership in above bungalow, hence this transfer is for “consideration” and not out of “love and affection”. Even if the price stated by the assessee in his submission is taken into consideration that it has been purchased by assessee from brothers for Rs. 12 crores, there is difference Rs. 28 crore as the stamp value determined by the Registrar for this property is Rs. 40.65 crores. It is also seen that the assessee has not objected to such valuation of Registrar and paid stamp duty. The A.O, therefore, noted that provisions of Section 56(2)(vii)(b) of the I.T. Act, 1961 are attracted and the exclusion provided in proviso to Section regarding “relatives” does not apply in this case.

CIT(A) also noted that since it is a commercial transaction, therefore, it is not out of love and affection, therefore, confirmed the finding of fact recorded by the A.O.
CIT(A) in alternate also noted that assessee was bound to explain the source of investment in the property and will fall within the mischief of investment not fully disclosed in the books of account as per Section 69B of the act.

Held that— The word ‘natural love and affection’ have not been specified in Section 56(2)(vii)(b) of the I.T. Act. Therefore, this term has no consequence to the above provisions in which the A.O. made the addition. Since the amount of Rs. 12 crores have been taken by assessee as loan from the Bank through the respective agreements referred to above, therefore, it could not be treated as undisclosed income of the assessee. The assessee has explained source of Rs. 12 crores through the loan taken from the Bank.
Therefore, provisions of Section 69B of the I.T. Act, would not apply to the case of the assessee. Further, it was not the case of the A.O. that provisions of Section 69B are attracted in the case of assessee. Therefore, the Ld. CIT(A), could not have bring to tax the aforesaid amount through new source of income.[SHRI GOVIND KUMAR KHEMKA VERSUS THE ACIT, CIRCLE-47 (1) , NEW DELHI.] [2019] 17 ITCD Online (13) [ITAT DELHI]

Since the amount of Rs. 12 crores have been taken by assessee as loan from the Bank through the respective agreements referred to above, therefore, it could not be treated as undisclosed income of the assessee. The assessee has explained source of Rs. 12 crores through the loan taken from the Bank.

Shanti Prime Publication Pvt. Ltd.

Section 56(2), 69B of Income Tax Act, 1961— In the instant case, assessee challenged the addition of Rs. 28,65,00,000/- under section 56(2)(vii)(b) and u/s 69B of the act made by CIT(A).