Tribunal allows appeal, orders fresh market value determination, and emphasizes legal compliance.

The appeal was partly allowed for statistical purposes. The Tribunal directed fresh adjudication on fair market value determination and specific instructions on computing capital gains excluding Section 50C for the transfer of development rights. The order stressed adherence to legal provisions and principles of natural justice.

---

---

Issues Involved:
1. Condonation of delay in filing the appeal.
2. Validity of assessment under Section 144 versus Section 153C.
3. Applicability of Section 50C to the transfer of development rights.
4. Fair market value determination as of 01.04.1981.
5. Recalculation of Long-Term Capital Gains (LTCG) by adopting the sale consideration determined by the DVO.

Detailed Analysis:

1. Condonation of Delay in Filing the Appeal:
The assessee filed the appeal with a delay of 121 days, attributing the delay to the death of her husband, who managed the tax matters. The Tribunal condoned the delay, noting the absence of objections from the Revenue and the circumstantial nature of the delay.

2. Validity of Assessment under Section 144 versus Section 153C:
The assessee argued that the assessment should have been completed under Section 153C due to the involvement of incriminating materials found during a search at a third party's premises. The Tribunal noted that the ADIT, Nashik, who reported the information, was not the Assessing Officer of the searched party. Hence, the requirements of Section 153C were not met. Consequently, the assessment under Section 144 was deemed appropriate since the assessee had failed to file a return.

3. Applicability of Section 50C to the Transfer of Development Rights:
The Tribunal examined whether Section 50C, which applies to the transfer of land or building, was applicable to the transfer of development rights. The development agreement indicated that the ownership of the land remained with the assessee, and only development rights were transferred on a license basis. Citing legal precedents, the Tribunal concluded that Section 50C did not apply to the transfer of development rights. Therefore, the addition made by invoking Section 50C was incorrect.

4. Fair Market Value Determination as of 01.04.1981:
The assessee contested the fair market value adopted by the Assessing Officer, claiming it was arbitrary. The Tribunal found that neither the Assessing Officer nor the assessee provided a cogent basis for their valuations. The Tribunal directed the Assessing Officer to re-determine the fair market value, ensuring the reasons for such determination are clearly spelled out, thus restoring the issue for fresh adjudication.

5. Recalculation of LTCG by Adopting Sale Consideration Determined by the DVO:
The Tribunal noted that the development rights were transferred through an agreement in 2006, and the ownership rights were transferred later in 2009. Since Section 50C was not applicable to the transfer of development rights, the capital gains for the year under consideration should be computed under Section 48, excluding the provisions of Section 50C. The recalculation of LTCG based on the DVO's valuation was thus set aside.

Conclusion:
The appeal was partly allowed for statistical purposes, with directions for fresh adjudication on the fair market value determination and specific instructions on the computation of capital gains excluding the applicability of Section 50C for the transfer of development rights. The Tribunal's order emphasized adherence to legal provisions and principles of natural justice.

---