Tribunal directs fair market value for capital gains, emphasizes proper opportunity for appellant

The Tribunal allowed the appeal, directing the Assessing Officer to refer the valuation to a departmental officer and compute the capital gains based on the fair market value determined by an approved valuer, setting aside the lower authorities' decisions that relied on stamp duty valuation. The delay in submission of documents was not solely attributed to the appellant, and the Tribunal emphasized providing a proper opportunity for the appellant in processing the claim under section 50C(2)(a).

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Issues involved: Appeal against assessment u/s 143(3) for AY 2004-05 regarding computation of capital gains u/s 50C.

Comprehensive details:

1. The appellant, a Doctor, sold property in Uttaranchal for Rs. 13 lakhs, declared capital gains of Rs. 66,205. AO invoked section 50C based on stamp duty valuation of Rs. 20,06,500. Appellant claimed distress sale due to encroachment and dilapidated condition of property, requested valuation by departmental officer u/s 50C(2)(a).

2. AO noted delay in submission of documents by appellant, did not refer valuation to departmental officer due to time constraints. CIT(A) upheld AO's decision based on stamp duty valuation.

3. Tribunal observed that if stamp duty value exceeds fair market value, valuation can be referred to departmental officer u/s 50C(2)(a). AO accepted appellant's claim based on approved valuer's report showing fair market value of Rs. 11,28,000. Tribunal set aside departmental authorities' orders, directed AO to refer valuation to departmental officer and compute capital gains accordingly.

4. Tribunal found delay not solely attributable to appellant, as claim was made promptly. AO had sufficient time to refer valuation to departmental officer before time bar. Tribunal allowed appeal, directing proper processing of appellant's claim u/s 50C(2)(a) and ensuring due opportunity for appellant.

Separate Judgement: None.

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