Tribunal directs reassessment of valuation by Assessing Officer, emphasizes DVO referral for capital assets

The Tribunal allowed the assessee's appeal for statistical purposes, directing the Assessing Officer to refer the matter to the Valuation Officer for proper valuation and to decide the issues afresh in accordance with the law. The Tribunal emphasized the necessity of referring the valuation of capital assets to the DVO when there is a variance between the fair market value claimed by the assessee and the value assessed by the stamp valuation authority.

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Issues:
1. Addition of Rs. 3,04,99,400 under section 69 for difference in actual sale value and circle rate for stamp duty purposes.
2. Absence of reference to DVO for valuation despite specific request.
3. Discrepancy in declared sale consideration and FMV adopted by AO.

Issue 1: Addition under section 69:
The assessee appealed against the Order passed by the Ld. CIT(A) regarding the addition of Rs. 3,04,99,400 under section 69 for the variance between the actual sale value and the circle rate for stamp duty purposes. The AO made the addition during assessment, which was confirmed by the Ld. CIT(A). The assessee argued that the declared sale consideration of Rs. 4,27,12,600 for all five properties was the real FMV, contrary to the FMV adopted by the AO at Rs. 7,32,12,000. The Tribunal noted that the matter was not referred to DVO despite the assessee's specific request, which is required under the law. The Tribunal set aside the issue to the AO with directions to refer the matter to the DVO for valuation and to decide the matter afresh after considering the DVO's report.

Issue 2: Absence of reference to DVO:
The assessee contended that there was an absence of reference to the DVO for valuation despite a specific request made during assessment proceedings. The Ld. CIT(A) and AO did not refer the matter to the DVO, stating that it was not mandatory. However, the Tribunal held that once the assessee requests a reference to the DVO, it is necessary to do so as per the law. The Tribunal relied on legal provisions requiring the AO to refer the valuation of the capital asset to the Valuation Officer if the fair market value claimed by the assessee differs from the value assessed by the stamp valuation authority. The Tribunal directed the AO to refer the matter to the DVO for valuation and decide the matter afresh after considering the DVO's report.

Issue 3: Discrepancy in declared sale consideration:
The assessee argued that the actual purchase consideration was Rs. 4,27,12,600 as per registered purchase deeds, signed before the Registrar. The AO, however, added Rs. 3,04,99,400 based on the difference between the actual purchase consideration and the circle rate for stamp duty purposes. The Tribunal found that the matter should have been referred to the DVO as per legal requirements. Therefore, the Tribunal set aside the issue to the AO for proper valuation by the DVO and a fresh decision.

In conclusion, the appeal filed by the assessee was allowed for statistical purposes, and the Tribunal directed the AO to refer the matter to the DVO for valuation and decide the issues afresh in accordance with the law.

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