ITAT directs Assessing Officer to accept Registered Valuer's report for capital gains computation

The ITAT allowed the appeal, setting aside lower court decisions. It directed the Assessing Officer to accept the valuation per the Registered Valuer's report for computing capital gains, emphasizing the need to follow proper procedures and consider expert opinions. The dispute centered on the valuation of property as of 01.04.1981 for capital gain computation, with the ITAT finding the Assessing Officer lacked evidence to dispute the Valuer's report and should have referred the matter to the DVO if necessary.

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Issues:
1. Valuation of property as on 01.04.1981 for computing capital gain.

Analysis:
The appeal was against the order of the ld. CIT(Appeals) regarding the rejection of market valuation as on 01.04.1981. The Assessing Officer adopted a lower rate for valuation compared to the Registered Valuer's valuation. The Registered Valuer had valued the property at 3.5 times the sale rate as per the registered deed in 1981. The Assessing Officer disagreed with this approach and adopted a lower rate of &8377; 24,000/- per kanal for computing capital gain.

During the appellate proceedings, the assessee argued that the Assessing Officer should have referred the matter to the Valuation Officer or DVO for valuation, as per relevant sections of the Income Tax Act. The ld. CIT(Appeals) dismissed the appeal, stating that the reference to the Valuation Officer under section 142A or DVO under section 50C was not applicable in this case as the issue was about computing the cost of acquisition as on 01.04.1981, not the valuation of the property at the time of sale.

The ld. CIT(Appeals) also discussed various judgments cited by the appellant, clarifying that the cases referred to were not directly applicable to the present case. The Assessing Officer's calculation based on the Registered Valuer's report was upheld, as there was no scientific basis for the Valuer's multiplier of 3.5 times the registration rate. The ld. CIT(Appeals) concluded that the Assessing Officer's adoption of the rate of &8377; 24,000/- per kanal for 01.04.1981 was justified.

In the final judgment, the ITAT set aside the orders of the authorities below. The ITAT found that the Assessing Officer did not have any evidence to contradict the Registered Valuer's report and should have referred the matter to the DVO if unsatisfied. Therefore, the ITAT directed the Assessing Officer to accept the valuation reported by the assessee as per the Registered Valuer's report for computing capital gains. The appeal of the assessee was allowed, and the orders of the authorities below were not sustained.

In conclusion, the judgment focused on the correct valuation of the property as on 01.04.1981 for computing capital gain, emphasizing the importance of following proper procedures and considering expert opinions in such matters.

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