Appeal granted under Sections 54B and 54F, additions under Section 50C deleted.

The tribunal allowed the appeal by the assessee, ruling that the entire sale consideration was invested in new assets, granting full benefit under Sections 54B and 54F. Consequently, the additions based on higher valuations under Section 50C were deleted, and other issues raised were deemed academic. The order was pronounced on 11/06/2018 in open court.

---

---

Issues Involved:
1. Addition of Rs. 13,49,532 as Long Term Capital Gain.
2. Invocation of Section 50C of the Income Tax Act, 1961.
3. Application of DLC rate of land as on the date of Agreement to Sale.
4. Retrospective application of the proposed amendment in Budget 2016 to Section 50C.
5. Extension of the scope of Section 50C on investments under Section 54B and 54F.
6. Addition of Long Term Capital Gain at Rs. 1,93,81,842.
7. Acceptance of sale consideration as evidenced by the sale deed.

Detailed Analysis:

1. Addition of Rs. 13,49,532 as Long Term Capital Gain:
The assessee contested the addition of Rs. 13,49,532 as Long Term Capital Gain, arguing that the CIT(A) erred in confirming the AO's action. The tribunal noted that the AO adopted the stamp duty valuation under Section 50C, which was higher than the declared sale consideration. The assessee argued that the DLC rates as on the date of agreement should be considered, not the date of the sale deed. The tribunal found merit in the assessee's contention that the DLC rates should reflect the fair market value, not temporary enhancements.

2. Invocation of Section 50C of the Income Tax Act, 1961:
The AO invoked Section 50C, adopting the sale consideration at a higher value based on stamp duty valuation. The tribunal observed that the AO referred the valuation to the DVO, who based the valuation on temporarily enhanced DLC rates. The tribunal held that the DVO should have considered the fair market price instead of the temporary enhancement.

3. Application of DLC rate of land as on the date of Agreement to Sale:
The assessee argued that the DLC rates as on the date of the agreement to sell (22.09.2011) should be adopted, as part payment was received on that date. The tribunal agreed, noting that the agreement's existence was evidenced by part consideration received, despite the agreement not being registered.

4. Retrospective application of the proposed amendment in Budget 2016 to Section 50C:
The assessee claimed that the proposed amendment should be treated as retrospective. The tribunal did not delve deeply into this issue, as it found that the capital gain was fully invested in new capital assets, making this point academic.

5. Extension of the scope of Section 50C on investments under Section 54B and 54F:
The AO restricted the benefit of Sections 54B and 54F to the actual investment made, based on the higher capital gain computed under Section 50C. The tribunal held that once the entire sale consideration was invested in eligible assets, no additional tax liability should arise from the deemed full value consideration under Section 50C.

6. Addition of Long Term Capital Gain at Rs. 1,93,81,842:
The AO added Rs. 1,93,81,842 as Long Term Capital Gain by adopting a higher sale consideration based on stamp duty valuation. The tribunal found that the assessee had invested the entire sale consideration in new assets, which should negate any additional tax liability from the higher valuation.

7. Acceptance of sale consideration as evidenced by the sale deed:
The assessee argued that the sale consideration as per the sale deed should be accepted. The tribunal supported this view, noting that the actual sale consideration was fully invested in new assets, making the higher valuation under Section 50C inconsequential.

Conclusion:
The tribunal concluded that since the assessee invested the entire sale consideration in new agricultural land and residential property, the full benefit of Sections 54B and 54F should be granted. Consequently, the additions made by the AO based on higher valuations under Section 50C were deleted. The appeal by the assessee was allowed, and the other issues raised became academic.

Order:
The appeal filed by the assessee was allowed, and the order was pronounced in the open court on 11/06/2018.

---