Tribunal directs fair valuation process, excludes TDR value in capital gain computation.

The Tribunal allowed the revenue's appeal for statistical purposes, directing a valuation referral to the DVO for computing capital gain under sec.50C. It emphasized the importance of considering the net land area available for transfer, excluding TDR or additional FSI value. The Tribunal rejected the revenue's reliance on a High Court decision and instructed the AO to provide a fair hearing to the assessee during valuation proceedings. Ultimately, the Tribunal set aside the Ld. CIT (A) order and emphasized the necessity of a thorough valuation process.

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Issues:
1. Challenge to the impugned order of Ld. CIT (A) for A.Y. 2006-07.
2. Whether the sale of the plot of land attracts sec.50C for computing capital gain u/s.48.

Analysis:
1. The appeal involved a challenge by the revenue against the order of Ld. CIT (A) for A.Y. 2006-07. The revenue raised grounds related to the Fair Market Value of the plot sold, adoption of prorate basis for valuation, and non-preference of claim u/s.50C(2) by the assessee.

2. The main issue was whether the sale of the land plot falls under sec.50C for computing capital gain u/s.48. The assessee sold a plot for &8377; 20 lakhs, declaring &8377; 10 lakhs as sale consideration due to owning half share. The AO valued the land at &8377; 1,19,72,064, applying sec.50C. The Ld. CIT (A) allowed the assessee's contention based on a pro-rata consideration of &8377; 7,14,910 for the 134 sq. meters sold.

3. The Tribunal found discrepancies in the land acquisition details and the Development Agreement. It noted that the assessee transferred 2244.18 sq. meters, excluding areas acquired for highways. The Tribunal emphasized considering the net area available for transfer to the Developer, excluding TDR value. It set aside the Ld. CIT (A) order, directing valuation referral to the DVO.

4. The Tribunal rejected the revenue's reliance on a High Court decision, distinguishing 'immovable property' from 'land and building' in sec.50C. It emphasized the need for a DVO valuation considering the net land transfer and excluding TDR value. The A.O. was directed to provide a fair hearing to the assessee during valuation proceedings.

5. Ultimately, the Tribunal allowed the revenue's appeal for statistical purposes, emphasizing the need for a thorough valuation process considering the net land area available for transfer and excluding the value of TDR or additional FSI. The order was pronounced on 28th March 2012.

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