Fair market value evidence prevails over guideline value, while brokerage, section 54 relief, and cash deposit explanations failed.

A reasoned fair market valuation supported by an approved valuer's report and comparable instances cannot be displaced merely by Sub-Registrar guideline value without proper technical examination, so the assessee's 01.04.1981 valuation was upheld. By contrast, the brokerage claim failed for want of documentary proof, the section 54 exemption was denied because the residential house was purchased outside the prescribed one-year pre-transfer window, and the cash deposits were treated as unexplained because the alleged sale of household items and furniture was not supported by reliable evidence. Partial relief was therefore granted only on the valuation issue.

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Issues: (i) whether the fair market value of the property as on 01.04.1981 adopted by the assessee could be displaced merely on the basis of the Sub-Registrar's guideline value; (ii) whether deduction towards brokerage was allowable; (iii) whether exemption under section 54 was admissible on the purchase of the residential house; and (iv) whether the cash deposits were satisfactorily explained as sale proceeds of household items and furniture.

Issue (i): Whether the fair market value of the property as on 01.04.1981 adopted by the assessee could be displaced merely on the basis of the Sub-Registrar's guideline value?

Analysis: The assessee supported the adopted value with an approved valuer's report and a comparable transaction in the vicinity. The Assessing Officer, instead of testing the valuation through an expert reference, relied only on the Sub-Registrar's basic value register. The Tribunal held that the assessee's valuation was supported by material and that the guideline value could not, by itself, displace a reasoned valuation report without a proper technical examination.

Conclusion: The assessee's valuation as on 01.04.1981 was upheld, in favour of the assessee.

Issue (ii): Whether deduction towards brokerage was allowable?

Analysis: No documentary evidence was produced to establish payment of brokerage, and the claim had not been effectively pursued before the lower appellate authority. In the absence of proof, the claim could not be accepted.

Conclusion: The brokerage claim was rejected, against the assessee.

Issue (iii): Whether exemption under section 54 was admissible on the purchase of the residential house?

Analysis: The residential property stood purchased in February 2010, whereas the transfer took place in October 2011. The Tribunal treated the transaction as an outright purchase and held that the statutory requirement of purchase within one year before the date of transfer was not met. The plea based on later occupation or semi-finished condition did not alter the purchase date recorded in the sale deed.

Conclusion: Exemption under section 54 was not allowable, against the assessee.

Issue (iv): Whether the cash deposits were satisfactorily explained as sale proceeds of household items and furniture?

Analysis: The assessee relied on undated confirmations and did not produce purchase bills, vouchers, or reliable supporting particulars for the alleged items sold. The claimed prices were also found to be unconvincing in the absence of details regarding make, condition, or marketability. The Tribunal held that the source of the deposits was not proved.

Conclusion: The explanation for the cash deposits was rejected, against the assessee.

Final Conclusion: The addition relating to the fair market value issue was deleted, while the disallowance of brokerage, the denial of section 54 exemption, and the rejection of the explanation for cash deposits were sustained, resulting in partial relief to the assessee.

Ratio Decidendi: A reasoned valuation supported by expert material cannot be displaced merely by guideline rates, but statutory exemptions and cash deposit explanations must be proved by cogent evidence and must satisfy the relevant statutory conditions.

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