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of <h1>Tribunal sets fair market value for land and upholds valuations for residential houses</h1> <h3>Kurian Joseph Versus Dy. CIT, Cir. 2(1) Ernakulam</h3> Kurian Joseph Versus Dy. CIT, Cir. 2(1) Ernakulam - TMI Issues Involved:1. Determination of fair market value as on 01-04-1981 for the land.2. Valuation of residential houses on the land.Detailed Analysis:1. Determination of Fair Market Value as on 01-04-1981 for the Land:The primary issue in this case was the determination of the fair market value of 75.046 cents of land as on 01-04-1981 for the purpose of computing capital gains. The assessee estimated the fair market value at Rs. 45,000 per cent, while the assessing officer restricted it to Rs. 3,000 per cent. The assessee's valuation was based on a report by an approved valuer, who estimated the value at Rs. 51,272 per cent, considering factors like location, proximity to NH 47, and potential for future development. The assessing officer, however, relied on a registered document dated 19-01-1980 for a 5 cents land, estimating its value at Rs. 3,000 per cent. The Tribunal noted that the subject land was situated much closer to the bypass road compared to the 5 cents land, which was 2 km away. Given the infrastructure and development potential, the Tribunal found that the lower authorities were not justified in restricting the value to Rs. 3,000 per cent and directed the assessing officer to accept the fair market value at Rs. 45,000 per cent as on 01-04-1981.2. Valuation of Residential Houses on the Land:The second issue was the valuation of two residential houses situated on the land. The assessee claimed the value of the old house at Rs. 12,54,327, while the assessing officer estimated it at Rs. 7 lakhs. The Tribunal found no substantial evidence to support the higher valuation claimed by the assessee, noting the lack of material to confirm the construction quality with teakwood and rosewood. Consequently, the Tribunal upheld the assessing officer's valuation of Rs. 7 lakhs for the old house.Regarding the second house, the assessee estimated its value at Rs. 16 lakhs, but the assessing officer valued it at Rs. 15 lakhs. The Tribunal observed that there was no valuation report or material evidence to support the higher valuation claimed by the assessee. Therefore, the Tribunal upheld the assessing officer's valuation of Rs. 15 lakhs for the second house.Conclusion:The Tribunal partly allowed the appeal, directing the assessing officer to adopt Rs. 45,000 per cent as the fair market value of the land as on 01-04-1981 while upholding the assessing officer's valuations of Rs. 7 lakhs and Rs. 15 lakhs for the two residential houses, respectively.Order Pronounced:The order was pronounced in the open court on 17th October 2014.
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