Tribunal rules on property valuation discrepancies, upholding some additions and deleting others.

The Tribunal partly allowed the assessee's appeal, directing the deletion of additions for properties with a 5.77% difference in valuation while upholding additions for properties with differences exceeding 10%. The decision was announced on 13 December 2021.

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Issues:
1. Retaining addition on account of difference between sales consideration and valuation by DVO.
2. Deletion of addition for properties with less than 15% difference between DVO and registered sales deed.
3. Benefit of Proviso to section 50C(1) for variation in valuation.

Issue 1: Retaining addition on account of difference between sales consideration and valuation by DVO:
The Assessing Officer (AO) noted a difference between the total consideration of land purchased by the assessee and the Jantri Rate Value determined by the Stamp Valuation Authority. The AO issued a show cause notice for adding the difference to the assessee's income under section 56(vii)(b) of the Act. The assessee contended that the properties were purchased at market value, and if unsatisfied, the matter could be referred to the District Valuation Officer (DVO). The AO, due to time constraints, decided the case based on the DVO's valuation of one property and Jantri Rate for the rest, resulting in an addition of Rs. 1.64 crore to the assessee's income.

Issue 2: Deletion of addition for properties with less than 15% difference between DVO and registered sales deed:
The assessee appealed the additions before the ld. CIT(A), providing detailed submissions. The CIT(A) accepted that certain properties had less than 15% difference in value between the DVO and registered sales deed. The CIT(A) directed the AO to treat the valuation of these properties accordingly, granting partial relief to the assessee.

Issue 3: Benefit of Proviso to section 50C(1) for variation in valuation:
During the Tribunal hearing, the assessee argued that the variation in valuation for certain properties was within the tolerance range mentioned in the Proviso to section 50C(1). Citing relevant case laws, the assessee sought relief based on the percentage difference in values. The Tribunal considered the submissions and ruled in favor of the assessee for properties with a 5.77% difference, granting the benefit of the amendment to section 50C(1). However, for properties with differences exceeding 10%, the Tribunal upheld the additions.

In conclusion, the Tribunal partly allowed the assessee's appeal, directing the deletion of additions for properties with a 5.77% difference in valuation while upholding additions for properties with differences exceeding 10%. The decision was announced on 13 December 2021.

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