Tribunal directs reassessment by DVO, stresses section 50C for fair value.

The Tribunal set aside the CIT(A)'s decision and directed reassessment after valuation by DVO, emphasizing adherence to section 50C provisions for fair market value determination. The assessee was granted a hearing opportunity before the new assessment, with the appeal allowed for statistical purposes.

---

---

Issues:
Assessment framed u/s 143(3) on income, Addition of long term capital gain, Invocation of section 50C, Consideration of valuation report, Failure to appreciate actual sale consideration.

Analysis:

1. The appeal was against the CIT(A)'s order for the assessment year 2015-16. The assessee, an individual, declared total income of Rs. 3,51,670/-, which was scrutinized for capital gain/loss on property sale. The Assessing Officer proposed full value consideration under section 50C due to variance between sale consideration and stamp duty value. The assessee's explanation was rejected, leading to an addition of Rs. 26,90,000/- to total income, contested unsuccessfully before CIT(A).

2. The assessee contended that objection to stamp duty valuation adoption was raised during assessment, requiring referral to DVO under section 50C(2). Purchase price was Rs. 16,00,000/-, with only 10% sold for Rs. 2,00,000/-. The valuation report indicated property value at Rs. 2,61,000/-. Citing precedents like Raj Kumari Agarwal vs. DCIT, the assessee argued against the unjustified addition.

3. The DR argued that as no request was made to refer valuation to DVO, the Assessing Officer rightly used stamp duty valuation. The Tribunal considered the transaction timeline, stamp duty valuation hike, and the assessee's objections. Referring to legal precedents, it emphasized the necessity to determine fair market value through DVO, remanding the matter to the Assessing Officer for fresh assessment.

4. The Tribunal, aligning with past decisions, set aside the impugned order, instructing reassessment after valuation by DVO. The assessee was granted a hearing opportunity before the new assessment. The appeal was allowed for statistical purposes, emphasizing adherence to section 50C provisions and fair market value determination.

This detailed analysis of the legal judgment highlights the issues involved, the arguments presented by both parties, the Tribunal's considerations, and the final decision rendered, ensuring a comprehensive understanding of the case.

---